BUSINESS

PLAN
SUBMITTED BY :

AIKO BACDAYAN

SUBMITTED TO:

DR. MA. LOUISA CORTEZ

Instructor
BACKGROUND OF THE BUSINESS

A. NAME OF THE BUSINESS -

The business shall be named ZION MUSHROOM FARM.

B. LOCATION - The business will be established in Dumabato, Maddela, Quirino.

Quirino is a good location because there are potential markets for mushroom products
and there are only limited supplier. So definitely, the mushroom supply in the province is
low.

C. BRIEF DESCRIPTION OF THE BUSINESS

The business is to be established in Dumabato Norte, Maddela, Quirino to produce

different types of mushroom to supply the demand of mushroom products not only in
Quirino province but also in the nearby provinces. The business shall observe and
maintain proper cultivation of the different mushroom types.

Mushroom cultivation activities can play an important role in supporting the local
economy by contributing to subsistence food security, nutrition, and medicine; generating
additional employment and income through local, regional and national trade; and
offering opportunities for processing enterprises.

It can help reduce vulnerability to poverty and strengthens livelihoods through the
generation of a fast yielding and nutritious source of food and a reliable source of
income. Mushrooms are a valuable food and they are often considered to provide a fair
substitute for meat, with at least a comparable nutritional value to many vegetables. The
consumption of mushrooms can make a valuable addition to the often unbalanced diets of
people in developing countries. Fresh mushrooms have a high water content, around 90
percent, so drying them is an effective way to both prolong their shelf-life and preserve
their flavor and nutrients.

Mushrooms are a good source of vitamin B, C and D, including niacin, riboflavin,

thiamine, and folate, and various minerals including potassium, phosphorus, calcium,
magnesium, iron and copper. They provide carbohydrates, but are low in fat and fibre,
and contain no starch. Furthermore, edible mushrooms are an excellent source of high
quality protein. In addition to all the essential amino acids, some mushrooms have
medicinal benefits of certain polysaccharides, which are known to boost the immune
system.

Medicinal Value: Recently, there has been a spectacular growth in, and commercial
activity associated with, dietary supplements, functional foods and other products that are
‘more than just food’. Medicinal fungi have routinely been used in traditional Chinese
medicine. Today, an estimated six percent of edible mushrooms are known to have
medicinal properties and can be found in health tonics, tinctures, teas, soups and herbal
formulas.
D. OBJECTIVES

Generally, any business is established to achieve positive cash inflow. But as

marketers, our business aims to create more customers. The project aims to produce
quality mushrooms and promote mushrooms as a part of our daily diet.

Our business focuses on the cultivation of the mushrooms. Along with the health
benefits, mushrooms are being widely used by the restaurants and the fast food chains.

- Provide good quality mushrooms at an affordable price

- Encourage the restaurants and customers to use fresh mushrooms rather than the
processed mushrooms which are sold in cans.
- To be the market leader in Mushroom Production
- Offer job opportunities to the Filipinos.

E. MARKETING PLAN

E.1 MARKETING ASPECT

DESCRIPTION OF PRODUCTS/SERVICES
The business offers for sale four mushroom types namely oyster mushroom, shiitake
mushroom and straw mushroom.

1. STRAW MUSHROOM
Volvariella volvacea (also known as straw mushroom or paddy straw
mushroom,Volvaria volvacea, Agaricus volvaceus, Amanita virgata, Vaginata virgata) is a
species of edible mushroom cultivated throughout East and Southeast Asia and used
extensively in Asian cuisines. They are often available fresh in Asia, but are more
frequently found in canned or dried form outside their nations of cultivation.Straw
mushrooms are grown on rice straw beds and picked immature, before the caps open.
They are adaptable and take 4-5 days to mature, and are most successfully grown in
subtropical climates with high annual rainfall. There is no record of their cultivation
before the 19th century. They resemble poisonous death caps, but can be distinguished by
their pink spore print; the spore print is white for death caps. Nevertheless, people have
been poisoned (sometimes fatally) making this mistake.

2. OYSTER MUSHROOM
The Oyster mushroom, or Pleurotus ostreatus, is a common edible mushroom. It was
first cultivated in Germany as a subsistence measure during the Great War and is now
grown commercially around the world for food. It is related to the similarly cultivated
"king oyster mushroom". Oyster mushrooms can also be used industrially for
mycoremediation purposes. The Oyster mushroom may be considered a medicinal
mushroom since it contains statins such as lovastatin which work to reduce cholesterol.
The mushroom has a cap spanning 5–25 cm broad, fan or oyster-shaped; Natural
specimens range from white to gray or tan to dark-brown; margin inrolled when young,
smooth and often somewhat lobed or wavy. Flesh white, firm, varies in thickness due to
stipe arrangement. The gills of the mushroom are white to cream, descend stalk if present.
If so, stipe off-center with lateral attachment to wood. The spore print of the mushroom is
white to lilac-gray, best viewed on dark background. The mushroom's stipe is often
absent. When present it is short and thick. The taste of the mushroom is described as mild
with a mild odor of anise.

3. SHIITAKE MUSHROOM
The Shiitake (Lentinula edodes) is an edible mushroom native to East Asia, which is
cultivated and consumed in many Asian countries, as well as being dried and exported to
many countries around the world. It is a feature of many Asian cuisines including
Chinese, Japanese, Korean and Thai. In the East, the Shiitake mushroom has long been
considered a delicacy as well as a medicinal mushroom.

E.2 MARKETING STRATEGIES

Locally-grown mushrooms have an advantage over imported ones because of their
very limited shelf-life and their fragility, making it difficult to ship them easily. Similarly,
mushrooms for fresh use tend to be grown near urban consumers, while farmers situated
some distance away from their consumer base, market their product after processing. A
successful marketing program means that growers increase their income status, which in
turn creates confidence in their ability to grow mushrooms profitably.

Steps to successful marketing include:

• Being aware of market demand by talking to buyers about volume and prices.
• Exploring various marketing options for fresh mushrooms – depending on transport
infrastructure - selling directly to local customers, local traders, markets, intermediaries,
regional wholesalers, local restaurants, shops or farmer cooperatives.
• Becoming organized and teaming-up with other producers, to bulk up on volume and
the variety of mushrooms, and attract traders regularly to enable reliable sales of the
perishable produce.
• Sharing knowledge and experiences with other producers and, if a problem or constraint
is consistent and widespread, collectively source external advice.

Establishing a good relationship with a buyer by delivering a reliable quality and

quantity of product is fundamental. It is important to start modestly and secure a buyer or
small network of buyers to whom one can deliver a reliable supply.

The method of storage and presentation of mushrooms at the point of sale should be
carefully managed and labelling produce – ‘fresh’ and ‘grown under controlled
conditions’ – is a helpful marketing strategy.

Mushrooms may be frozen and placed in airtight containers; however, unprocessed

mushrooms take up a lot of room and this can be a costly way of preserving them.
Mushrooms are also suitable for drying, enabling them to be stored for long periods
without deteriorating; this can be done using solar drying.
E.3 MARKET ANALYSIS

Mushroom is a vegetarian delicacy and a suitable substitute for meat and eggs. It is
easily digestible as well. It is very popular in most of the developed countries and being
accepted in many developing countries.Market for mushrooms is growing rapidly
because of their nice aroma, subtle flavor, nutritious values and special taste. Many exotic
preparations are made from them like soup, pickles, vegetables etc. It is also used for
stuffing several food preparations and for garnishing. But its consumption is still confined
to urban and semi-urban population. Mushrooms have very short life after harvesting and
hence they are sold in fresh form. Their shelf life can be enhanced by processing them.
We plan to have the fresh Mushrooms for the local market and the processed mushrooms
both for the local markets.

E.4 POTENTIAL TARGET MARKET

The major target market during the first year of operation would be the
wholesalers, retailers, restaurants and other food enthusiasts in Quirino province. If the
mushroom supply exceeds the demand in Quirino province, the business would be
targeting wholesalers and retailers in the nearby provinces.
There are typically three principal marketing routes for mushroom growers:
• The grower can sell directly to the consumers either at the farm gate or at local
markets; however, the ability to reach distant markets is limited.
• The grower can sell to an agent who then sells the mushrooms either to local or
distant markets.
• The grower can belong to a cooperative or another farm organization, which offers
easy market linkages to both local and distant markets.

E.5 PRICING STRATEGY

Market prices of different mushroom types are affected by the current supply and
demand condition. Therefore, the company cannot dictate market price. Prices for the
mushroom products shall now depend on the prevailing current market price within the
province of Quirino.

E.6 ADVERTISEMENT

The company will be providing brochures regarding the benefits derived from
mushroom products and distribute it to potential customers. This is to create awareness
about mushrooms and the existence of the mushroom farm and to eliminate any
uncertainties and confusions about mushrooms.
Twenty five percent discount will be provided on the first month of operation.

E.7 COMPETITIVE ANALYSIS

COMPETITORS: The competitors and projected demand of mushroom products will

be based on the answers of the questionnaires which will be floated. Respondents would
be wholesalers and retailers of mush room products in Quirino.
Questions to be asked are:
 What types of mushroom do you sell?
 How many kilograms of each mushroom type do you sell every day?
 How much do you pay for one kilogram of each mushroom type?
 What is the peak season of each mushroom type?
 Where do you get your mushroom supply?
 Are you satisfied with the quality of mushroom provided by your current suppliers?
Why or why not?
 What can you say about the price of the mushroom provided by your suppliers?
 If we provide you with quality mushrooms at a reasonable price, would you avail of
it? Why or why not?

F. MANAGEMENT PLAN

F.1 KEY PERSONNEL QUALIFICATIONS

GENERAL MANAGER
-Must possess excellent communication and leadership skills
-Must have strong and pleasing personality
-Willing to work even in weekends and holidays
-Knows how to manage a business and has the potential of enhancing the business
-Must have a background knowledge on mushroom cultivation
-Must be computer literate

DRIVER
-must be literate
-Patient and hardworking
-Physically fit
-must be a licensed driver

LABORERS
-must be hardworking
-must have a good background in farming
-Must be willing to undergo training
-Must be literate
-Has already knowledge in mushroom cultivation is a plus.

Compensation
Laborers - Php. 200.00 a day with free meal and snack
Driver - per contract depends on the location of orders for delivery.
G. FINANCIAL ASPECT

EQUIPMENT, APPARATUS AND TOOLS INVENTORY NEEDED ON BAKERY

 LAND
 BUILDING
 FURNITURE AND FIXTURES
 1 DELIVERY EQUIPMENT
 AUTOCLAVE
 1 WATER TANK
 1 POWER GENERATOR
 3 SPRAYER
 1 INOCULATION CHAMBER
 OTHER SMALL EQUIPMENTS AND TOOLS FOR CULTIVATION OF
MUSHROOM

WORK PLAN
Maintenance of the farm must be a daily routine in order to yield more product of the
different kinds of mushroom

PRODUCTION SERVE SPECIFICATION

PRODUCT NAME : STRAW MUSHROOMS

RAW MATERIALS COST

100 kg. RICE STRAW 50.00

5 kg. of UREA 100.00
5 kg. Garden gypsum powder 150.00
5 bottles Mushroom spawn at 84.00 each 420.00
ANIMAL MANURE preferably chicken 0.00
Water for soaking of rice straw 0.00
TOTAL 720.00

GROSS PROFIT :
1 bottle of mushroom spawn could produce approximately 10 kls. of Straw mushroom
5 bottles x 10 kls = 50 kls.
A kilo of straw mushroom is 150.00 for wholesale
50 kls. X 150.00 =7,500.00

EXPENSES: 720.00
NET INCOME : 7500.00 - 720.00 = 6, 780.00
PRODUCT NAME : OYSTER MUSHROOMS

RAW MATERIALS COST

100 kg. RICE STRAW 50.00

40 Plastic bags measuring 20 x 30 cm, or 18 x 25 cm,
are used as mushroom beds 80.00
5 bottles oyster Mushroom spawn , 3.5kg. 350.00
2 kg. Lime powder 100.00
TOTAL 580.00

GROSS PROFIT :
1 bottle of mushroom spawn could produce approximately 5 kls. of oyster mushroom
5 bottles x 5 kls = 25 kls.
A kilo of straw mushroom is 200.00 for wholesale
25 kls. X 200.00= 5,000.00

EXPENSES: 580.00

NET INCOME : 5,000.00 - 580.00= 4,420.00

PRODUCT NAME : SHIITAKE MUSHROOMS

RAW MATERIALS COST

20kgs wood sawdust 200.00

10kgs chopped rice straw (optional) 20.00
10kgs rice bran 100
1kg Gypsum powder 30.00
300grams agri-lime powder 50.00
300grams brown sugar 10.00
water
5 bottles shiitake mushroom spawn 420.00
TOTAL 830.00

GROSS PROFIT :
1 bottle of mushroom spawn could produce approximately 10kls. of shiitake mushroom
5 bottles x 10 kls = 50kls.
A kilo of straw mushroom is 180.00 for wholesale
50kls. X 180.00= 9,000.00

EXPENSES: 830.00

NET INCOME : 9000 less 830.00= 8,170.00

 PROPOSED BUDGETARY REQUIREMENT

EXPENSES:

OPERATING EXPENSES :
DIRECT MATERIALS P 2,130.00
TRANSPORTATION P 2,000.00
MISCELLANEOUS P 500.00
COMMUNCIATION P 300.00
TOTAL EXPENSES P 4,930.00

MUSHROOM TOTAL GROSS TOTAL GROSS

PRODUCTS INCOMEEVERY INCOME PER YEAR
MONTHS

GROSS PROFIT GROSS PROFIT

P 7,500.00 P 90,000
STRAW MUSHROOMS LESS EXPENSES LESS EXPENSES
P720.00 P 8,640.00
NET INCOME NET INCOME
P 6,780.00 P 81,360.00

GROSS PROFIT GROSS PROFIT

OYSTER MUSHROOM P 5,000 P60,000.00
LESS EXPENSES LESS EXPENSES
P 580 P 6,960.00
NET INCOME NET INCOME
P4,420.00 P 53,040.00

GROSS PROFIT GROSS PROFIT

P 9,000.00 P108,000.00
SHIITAKE MUSHROOM EXPENSES EXPENSES
P 830.00 P9,960.00
NET INCOME NET INCOME
P 8,170.00 P 98,040.00
 ZION’S MUSHROOM FARM

Estimated Estimated Estimated Estimated Estimated net Estimated net

PRODUCTS gross income gross income expenses per expenses per income per income per
per month per year month year month year ROI
(Php.) (Php.) PER YEAR
(Php.) (Php.) (Php.) (Php.)

7500 90000 720 8640 6780 81360 941.66%

STRAW
MUSHROOMS

OYSTER 5000 60000 580 6960 4420 53040 762.06%

MUSHROOM

9000 108000 830 9960 8170 98040 984.33%

SHIITAKE
MUSHROOM