FRUITEX

CHAPTER 1. INTRODUCTION

A. Proposed Business

Fruitex is a clothing line brand that shall release excellent quality clothing made from banana, orange,
and pineapple fibers, delicately weaved by knowledgeable and skilled artisans. The term “Fruitex”
originates from the root words “fruit” and “textile”. This business aims to provide quality fabric and
fashion designs that will be able to specifically cater and appease to the youth. Since fashion is a
dynamic and developing industry knowingly being affected by various factors of the economy, Fruitex
shall indulge in the current fashion style trends worldwide, while being able to represent, express, and
divulge the Philippine traditions and cultures through its clothing designs.

Fruitex is a manufacturing business ruled by a corporation.

Not only shall Fruitex introduce and promote the new side of fabric materials, but it shall enhance the
environment and society by lessening the rate of food wastage and improper placement of trash, thus
making Fruitex a beneficial-to-all clothing line. Fruitex is a sustainability-based clothing line that shall
open a new path for a more reliable and stylish future.

B. Raw Materials

As stated in Section A, Fruitex clothing shall be made with fibers from the byproducts of certain fruit
peelings (banana, orange, and pineapples). The main source of gathering the raw materials for textile
production shall be stemmed from the collaboration of baking companies and supermarkets. The
secondary source of gathering raw materials shall be Fruitex’s new “pay with fruit peelings” payment
option.

C. Name of the Owners

Maria Carmela Querrer Cabacungan

Liane Rein Gonzales Cayaban

Angelique Cabalquinto Corido

Cristian James Cabato

Angela Arevalo May Maquilan

Breathany Eileithyia Balacdao Rentiquiano

Sheilrick Eshey De Guzman Sanchez

 D. PESTEL ANALYSIS

POLITICAL ECONOMIC SOCIAL TECHNOLOGICAL ENVIRONMENTA LEGAL

FORCES FORCES FORCES FORCES L FORCES FORCES

Demographic
Political state trends Business
of the High Rates of (including the Social Media Climate Change License
Philippine Inflation rate of
Government population
growth)

Rules,
Regulations, Consumers Business
and Employment attitudes and Artificial Ethical Name
Presidential Rate beliefs Intelligence Registration
Decrees
(Government
Implemented)

Policies
regarding Lifestyle Recycling and Professional
textiles Tax Rate trend Novel Fibers Disposal Premises
(Government
Implemented)

Trading/Retail
Rules and Demand of Buying
Regulations fruit waste patterns 3D Printing Sustainability Patent
(Government
Implemented)

Sanitation
Rules and Preference of Solid-waste Consumer
Regulations Recession certain ages E-Commerce treatment and Law
(Government disposal
Implemented)
I. POLITICAL FORCES

 Political State of the Philippine Government

The Government state where this business shall start will directly affect the said business due to
the way of ruling, the implementation of laws, and Presidential decrees.

 Rules, Regulations, and Presidential Decrees (Government Implemented)

The rules, regulations, and presidential decrees shall address the level of authority and limits in
order for entrepreneurs to handle their business/es justly.

Presenting the Philippine Republic Act No.7394, the “Consumer Act of the Philippines.”, states
to protect the interests of the consumer, promote his general welfare and to establish standards of
conduct for business and industry. Towards this end, the State shall implement measures to
achieve the following objectives:

a)              protection against hazards to health and safety;

b)              protection against deceptive, unfair and unconscionable sales acts and practices;

c)              provision of information and education to facilitate sound choice and the proper
exercise of rights by the consumer;

d)              provision of adequate rights and means of redress; and

e)              involvement of consumer representatives in the formulation of social and economic

policies.

 Policies regarding textiles (Government Implemented)

The policies regarding textiles shall address the level of authority and limits in order for textile
entrepreneurs to handle their business/es justly, and improve their business/es promptly in their
own right.

Presenting the Philippine Presidential Decree No. 1440:

CREATING THE GARMENTS AND TEXTILE EXPORT BOARD (GTEB) DEFINING ITS
POWERS AND FUNCTIONS, PROVIDING FUNDS THEREFOR AND FOR OTHER
PURPOSES.

WHEREAS, it is the policy of the government to develop and promote exports essential for the
maintenance of a sustained economic growth, generating the much-needed foreign exchange and
the maintenance of a stable position in international reserves;
 WHEREAS, an increasing number of countries seek to impose restraint levels on Philippine
exports of textiles and garments under the Arrangement regarding the International Trade in
Textiles, also known as the Multi-Fibre Agreement (MFA);

WHEREAS, the Philippines has concluded several international trade agreements for the export
of textile and garments with other countries;

WHEREAS, there is a need to ensure proper implementation of said agreements and effect
coordinated efforts in line with the existing government trade development programs

 Trading/Retail Rules and Regulations (Government Implemented)

The policies regarding trading/retail shall address the level of authority and limits in order for
textile entrepreneurs to handle their business/es justly, improve their business/es promptly in their
own right, and exchange goods within the national and international sectors cordially.

Presenting the Philippine Republic Act No. 8762, the “Retail Trade Liberalization Act of 2000.”

It is the policy of the State to promote consumer welfare in attracting, promoting, and welcoming
productive investment that will bring down price for the Filipino consumer, create more jobs,
promote tourism, assist small manufacturers, stimulate economic growth and enable Philippine
goods and services to become globally competitive through the liberalization of the retail trade
sector.

Pursuant to this policy, the Philippine retail industry is hereby liberalized to encourage Filipino
and competitive retail trade sector in the interest of empower the Filipino consumer through
lower prices, higher quality goods, better services and wider choices.

 Sanitation Rules and Regulations (Government Implemented)

The policies regarding sanitation shall address the level of authority and limits in order for textile
entrepreneurs to handle their business/es justly, improve their business/es promptly in their own
right, exchange goods within the national and international sectors cordially, and take in regard
the health and environment aspects for the safety of each individual.

Presenting the Philippine Republic Act No. 4653,

“AN ACT TO SAFEGUARD THE HEALTH OF THE PEOPLE AND MAINTAIN THE
DIGNITY OF THE NATION BY DECLARING IT A NATIONAL POLICY TO PROHIBIT
THE COMMERCIAL IMPORTATION OF TEXTILE ARTICLES COMMONLY KNOWN AS
USED CLOTHING AND RAGS.”

II. Economic Forces

 High Rates of Inflation

Inflation, in brief, can be interpreted as a tendency to increase the prices of goods and
services in general and continuously. Inflation is "an increase in the average price level,
and the price is the rate at which money is needed to obtain goods and services." Inflation
 will affect each business, including investment activities. Inflation also causes a decrease
in people's purchasing power, resulting in a reduction in sales, which is unsuitable for the
business. The decline in sales that occurs can reduce the company's return. The return
decline will affect the company's ability to pay installments.

 Employment Rate

In the Philippines, almost a million people live for a job for themselves and their families.
Although employment in the Philippines has been growing fast for the past decade, many
Filipinos are still jobless. The employment growth rate was recorded to be almost 50 percent at
the beginning of the twentieth century, mainly in the industrial, agricultural, and services sectors.
However, as 2000 entered, the country's population quickly rose, reaching 76 million. According
to the Philippine Statistics Authority Employment Rate in July 2022, it is estimated at 94.8
Percent. The country's employment rate rose to 47.39 million in July 2022, from 41.67 million in
the same 2021.

The country's employment rate continued to pick up to 94.8 percent, up from 94.0 percent in the
previous month. At the same time, the number of unemployed people declined to 2.60 million in
July 2022 from 3.23 million in July 2021. The number of unemployed persons in July 2022
resulted in an unemployment rate of 5.2 percent, the lowest reported unemployment rate from
January to July 2022 and the lowest of all July rounds since 2005. In June 2022, the number of
unemployed persons was estimated at 2.99 million.

 Tax Rate

A tax rate is the level at which a government imposes taxes, usually expressed as a percentage.
They may pay taxes based on a tax rate applied to their income or purchase they make. According
to our econometric models, the Philippines' Personal Income Tax Rate is expected to trend around
35.00 percent in 2022. Individuals, whether self-employed or professionals are subject to the
above-mentioned graduated income tax rates.

According to Gatdula T.'s Let's Talk Tax, it went into effect on April 11 last year. Its primary
goal is to reduce corporate income tax rates for both domestic and foreign corporations to
mitigate the economic impact of the COVID-19 pandemic. This is not the case for Regional
Operating Headquarters (ROHQs), which previously benefited from a 10% income tax rate. With
the passage of the CREATE Law, ROHQs will now be taxed at 25% Regular Corporate Income
Tax (RCIT) or 1% (until June 30, 2023) and 2% Minimum Corporate Income Tax (MCIT),
whichever is higher, beginning January 1, 2022.

The corporate tax rate for base rate entities will now be reduced from 27.5% to 26% in 2020-
2021, then 25% in 2021-2022, and subsequent income years. This means eligible corporate
taxpayers will pay 25% in 2021-2022 instead of 2026-2027. The new law also raises the small
business income tax offset rate for 2020-2021 to 13% of the primary income tax liability related
to small business income. For 2021-2022 and later income years, the offset rate will rise to 16%.
The corporate income tax rate is 30% of net taxable income for both domestic and foreign
corporations. Income tax consists of the following:

● Domestic corporation dividends received

 ● Bank deposits in Philippine currency earn interest.

● Trust fund returns.

 Demand of Fruit Waste

Due to their intrinsic perishability, fruits and vegetables are the food groups that are
wasted the most. Few studies have been completed in developing nations like the
Philippines, even though several have evaluated consumer-level fruit and vegetable
waste. Both types of shoppers bought the most significant number of bananas.
Watermelons and pineapples were the following most popular fruits to be purchased, and
supermarket customers bought more of these items than wet market customers did.
Apples and oranges were the most often purchased imported and temperate fruits for both
consumers. The other fruits bought were calamondin, grapes, papaya, avocado, rambutan,
and lanzones.

According to Dole (2021), Around 1 million tons of fruit side streams (fruit waste) are
generated each year at Dole’s plantations in the Philippines, which equates to
approximately 50,000 40-foot containers generate around one million tonnes of fruit side
streams per year, which equates to about 50,000 40-foot containers Not only will
exporting so much fruit waste from one country to another result in high logistics costs,
long-distance transportation would also affect the quality of the fruit side stream, making
it less viable for further use.

The Philippines is one of the world’s top producers of bananas and, therefore, one of the
leading generators of banana fruit stalk wastes. In Mindanao alone, some 1.35 billion
kilos of these stalks are produced yearly and left in the fields to rot. For many fruit
processing plants, a significant fraction of the solid waste comes from separating the
desired fruit constituents from undesired ones in the early stages 377 of processing. The
undesirable components include trimmings, peels, pits, seeds, and pulp (Ammar 2014).
Peels from bananas, for instance, constitute up to 30% of the ripe fruit, and in Davao,
about 79,000 metric tons of banana waste are produced annually (BAS 2013). Further,
considering the Philippine setting, data from the Philippine Statistics Authority (PSA
2018) show that pineapple waste can reach up to 130,000 metric tons annually since
about 75% of the fruit consists of peels, crowns, and core.

 Recession

Recession refers to the phase of a weak economic growth for a long period of time, which
exceeds the 3 key dimensions of recession; namely: duration, depth, and diffusion. This is often
caused by a decline in the gross domestic product growth for two consecutive quarters. The
National Bureau of Economic Research (NBER) declares when an economy is in recession,
which they determine through a variety of factors: Decline in real GDP; Decline in real income;
Decline in consumer spending; Increased rate of unemployment; and Stagnation of industrial
production and retail sales.
 With that being said, recessions impact businesses through a decrease in sales and profits,
reduction in cash flow, and changes in operation. Conclusively, recessions are few of the negative
consequences a business will eventually face at some point, for it is a natural and inevitable part
of the business cycle; nonetheless, preparation for its occurrence is best to lessen the damage it
may bring upon any business.

III. Social Forces

 Demographic trends (including the rate of population growth)

According to the latest data released by the Worldometer in accordance with the most recent
United Nations data, the Philippines has approximately 112, 863, 191 people just this Tuesday,
October 4, 2022. However, with such a large number of people, this business must still consider
who is the target of this product or apparel, including variables such as age, location, gender,
revenue, and hundreds of other variables. Considering this, we could decide on what product we
should produce that is much more able to be consumed and purchased rather than discarded.

 Consumers’ attitudes and beliefs

By understanding our buyer's or consumer's pattern of thinking, emotion, and choosing or

deciding, we can determine what product and marketing we can generate that will help our
established business in delivering saleable market goods.

 Lifestyle trend

It is a pattern and change in each individual's life habits that is relevant at a certain time.
However, this could shift from time to time depending on the consumer's tastes for certain
products. When we were establishing a business, it was really important for businesses to have
knowledge about consumer habits and values in different generations, cultures, and geographies
because with this we could provide and develop a tool in line with what the market wants. So, on
the contrary, if companies are not able to be aware of the trends and segmentation that the
consumer wants, it might leave the company vulnerable and prone to bankruptcy. In short, having
knowledge of these tools increases a company's chances of success. 

 Buying patterns

The term "buying pattern" describes the manner in which each customer obtains or purchases
things while considering the amount, duration, and regularity. As company owners, it is crucial to
think about, pay attention to, and analyze consumer behavior since doing so may help companies
better understand their market and perhaps grow by successfully providing or marketing essential
and desired product. Gathering this information helps us come up with ideas on how to get
customers to buy your product continuously and frequently. And this is advantageous for the
companies that sell the goods or provide the services because they can ensure or enable their sales
to increase by simply focusing on the needs and wants of their market.

 Preference of certain ages

 Everyone of any age has distinct preferences and likes regarding things, which is why while
developing a product, we should examine what each individual likes and specify them so that we
can design something that will attract the market's interest.

IV. Technological Forces

 Social Media

The use of social media has become the main frontier when establishing one's business due to its
robust technology that connects and networks people around the world to the world of different
entrepreneurs and business industries. Different businessmen and women are utilizing different
social media platforms such as Facebook, Instagram, and TikTok to promote their products
through ads, live selling, or even in the marketplace, which Facebook implemented for business
owners. This way, it can help as a way to market our product and sell something without needing
to produce a television ad or promote our product through billboards which can be costly and
time-consuming for us.

 Artificial Intelligence

It is a type of technology that is underrated but is gradually gaining momentum due to its
widespread application in science, technology, and business. Using AI can help our business
predict the latest fashion trends, which can then be integrated into our business and boost sales.

 Novel Fibers

The novel fiber technology is highly suitable for our business since our product's primary identity
is to build sustainable clothing lines through solid waste. This particular technology uses
chemicals from various solid textile wastes to create a new sustainable fiber and build clothing
lines that are both sustainable and high quality. Renewcell, a Swedish company, recently
produced 7000 tons of cellulose pulp from used garments. Another example is that some
researchers use acid hydrolysis to convert cotton-based waste textiles to improve fabric quality
chemically.

 3D Printing

3D printing technology has grown in popularity in many areas, particularly in the fashion
industry. Because of the minimal cost and short production time, it became highly advantageous.
Furthermore, we can use this novel technology in our business by allowing our clothing lines to
create unique and new clothing designs that will spark new interest in consumers. There is also
some evidence that it is sustainable and in high demand for those looking to start a fashion
business.

 E-Commerce
 E-commerce encompasses internet-based businesses, such as online payment and digital
shopping. It has become popular in recent years because it allows consumers to choose and
purchase a product through various methods. It is also beneficial to small businesses, which have
gradually grown with the help of the internet. One of the primary reasons why people prefer
online businesses is that they are less pricey. It is not necessary to rent a space to set up a clothing
store or hire advertisers to market their product. This is because the online market is quite
diverse. Once internet users begin typing something into their respective search engines, the
business will be able to market itself and attract customers. Because we live in a technologically
dependent world, using e-commerce is a nice feature in our startup business. It also demonstrates
that our business is diverse because it caters to any mode of consumer preference, whether online
or in person.

V. Environmental Forces

Fast fashion's environmental effect includes the loss of non-renewable resources, the
production of greenhouse gases, and the usage of vast amounts of water and energy.

 Climate Change

When people put clothing in the trash, they not only lose money and resources, but the materials
can take 200 years or more to degrade in a landfill. Textiles emit greenhouse methane gas and
leak harmful chemicals and colors into groundwater and our soil during the breakdown process.
Clothing production depletes natural resources and generates greenhouse gas emissions, which
contribute to climate change. According to the UN, the fashion sector is responsible for 8-10% of
global emissions, which is higher than aviation and shipping combined.

 Ethical

Ethical fashion is the design, manufacture, and distribution of clothing with the goal of
minimizing harm to people and the environment. In an ideal world, it helps people who work
throughout the supply chain and produces a brighter future for everyone, not just those at the top.
The figures concerning the life-cycle of garments and the total detrimental impact on the
environment are astonishing. Ethical clothing recycling ensures that clothes are not discarded
before they have been used to the point where they are no longer useable.

 Recycling and Disposal

Textile recycling is the process of reclaiming fiber, yarn, or fabric and reprocessing them into
useable items. Textile waste products are collected from various sources and then separated and
processed based on their condition, content, and resale value. Food waste may be transformed
into a fresh new home product with a little creativity. It will also assist to reduce household
expenditures and, eventually, eliminate any more waste.

 Sustainability

Sustainable waste management entails limiting and eliminating the usage of single-use plastic
items while also increasing the amount recycled. The goal of sustainable waste management is to
keep materials in use for as long as feasible while reducing the quantity of solid waste disposed of
in landfills or incinerated.
 Solid-waste treatment

Once collected, municipal solid trash can be processed to minimize the overall volume and
weight of material that must be disposed of. Treatment modifies the shape of the waste, making it
easier to manage. It may also be used to recover specific materials as well as thermal energy for
recycling or reuse. The process of collecting and processing solid waste is sometimes referred to
as solid waste disposal management. It offers options for recycling objects that do not belong in
the rubbish or trash. Solid waste management may be defined as the process of transforming trash
into a profitable resource. Improper disposal of municipal solid waste can lead to unhygienic
circumstances, which can lead to contamination of the environment. Diseases can be spread by
rodents and insects. The duties of solid waste disposal management are complicated technical
issues. They can also provide a wide range of economic, administrative, and social issues that
must be modified and resolved.

VI. Legal Forces

 Business License

A business license is a permit that allows your business to operate in your state or locality. A
business license may also refer to specialized licenses and permits that allow your business to
perform certain services or operate in certain locations.

 Business Name Registration

Enterprises other than companies are required under the registration of Business Names Act,
1961, to register their business names. A business name is the name or brand under which any
business is carried on, whether a partnership or otherwise. The law restricts entrepreneurs from
using certain business names. Any business name containing such words as "National"
"Government", "State", or Chamber of Commerce is not acceptable. This is to avoid anything that
will suggest that the enterprise enjoys the patronage of the federal state or local government
(Companies and Allied Matters Act 2004 CAMA).

 Professional Premises

Many states require that entrepreneurs register the premises being used for the practice of their
business. The essence of this ordinance is to ensure that the premises are suitable for the purpose
they are intended. Experience has shown that this serves mainly as a device for the collection of
registration fees and not much else.

 Patent

Provides the owner with exclusive rights to hold, transfer, and license the production and sale of
the product or process as an intellectual property right. Design patents last for 14 years, all others
last for 20 years.

 Consumer Law
 (Alternatively known as consumer protection) is designed to protect consumers from fraudulent
companies or practices, and preserve their rights in the marketplace.

Critical Success Weight FRUITEX BANANATEX PINATEX MUSA FABRIC

Factor
RATING WEIGHTED RATIN WEIGHTED RATING WEIGHTED RATIN WEIGHTED
SCORE G SCORE SCORE G SCORE
Product 25% 4 1 3 0.75 4 1 4 1
Price 15% 3 0.45 3 0.45 3 0.45 2 0.3
Personnel 15% 3 0.45 4 0.6 3 0.45 4 0.6
Brand 20% 4 0.8 4 0.8 4 0.8 4 0.8
Image/Promotio
n
Location 10% 3 0.3 4 0.4 3 0.3 4 0.4
Packaging 5% 4 0.2 4 0.2 2 0.1 2 0.1
Overall Service 10% 4 0.4 4 0.4 4 0.4 3 0.3
and Ambience
Total 100% 3.6 3.6 3.5 3.5

E. COMPETITIVE PROFILE MATRIX

F. DIFFERENTIATE THE RESULT OF THE BUSINESS FROM OTHER BUSINESS COMPETITORS

1. FRUITEX Clothing Brand is eligible in competing with its competitors in the field, for it has
accumulated a total score of 3.6, which encompasses the median score of 2.50.

2. Although FRUITEX Clothing Brand exceeds the weighted standard, the brand shall be on the
lookout for its competitors, whose ratings and scores are also promising. Most importantly, its
strongest competitor is BANANATEX, which holds an identical score with theirs.

G. SUGGESTED MARKET STRATEGIES TO KEEP UP WITH COMPETITORS

1. INTERACT WITH YOUR CUSTOMERS ESPECIALLY TO THOSE WHO IS NOT INTO YOUR PRODUCT

Interacting with your customers is an excellent idea because you would know what is the best
and least in your product that could make you improve. It will also maintain a close authentic
 touch with your customers, making them loyal. As the "not into your product" customers, there
is an actual reason why they are not into your product, just as: not entirely wanting the product,
having few choices, not too catchy for them, etc. So, you would interact with them and do
qualitative research, in which you would know what's lacking in your product and improve and
launch it so that more customers would buy your product. Building brand loyalty begins with
engagement. The key is constantly engaging with your target audience to help improve their
brand's perception. This enhanced sense of community is what helps drive further sales. The
best way to engage effectively is to showcase campaigns that connect and resonate with your
audience.

2. MONITOR THE TREND

By monitoring the trend, you would understand the target audience's needs. Every time a trend
changes, we do our best to research it because we do not want to be the last to know our
customers' latest needs. In this way, we can know what good visuals we can apply to our
product that would catch the target audience; make sure to make it unique! Also, learning the
new trend makes you learn about your competitors, which helps you come up with the newest
idea if they have already come up with a new one.

3. USE SOCIAL MEDIA PLATFORM AS YOUR PARTNER

Social media is the business and custom builder of your product. Social media is also a massive
outlet for staying in touch with your customers since most people are into online shopping. With
this, you can engage with your customers like: develop interesting surveys to improve your
product and produce ads for your product. Social media and digital marketing activities are
essential for gaining revenue and reducing the cost of conventional marketing activities. That is
what social media and digital marketing are helpful for; we can predict the future, prevent
crises, and create innovations; using social media and digital marketing can track our brand's
competitors.

The usage of these online activities is also to know people's opinions about our product, build
our brand reputation, and find the voices of our brand supporters or even the haters. These are
things that conventional marketing hardly achieves effectively. Also, social media helps
marketers reduce their marketing budget; placing an advertisement on TV, Radio, or Printed
Media needs a considerable budget, same goes for creating brand activation events.

4. FOCUSING ON HAVING A GOOD CUSTOMER SERVICE

Every customer is loyal because of having good customer service. Having good customer service
helps you to retain customers. Customer service is a great way to increase customer lifetime
value. If customers have a positive shopping experience, they will be more likely to buy from you
again. It is also easier to market new products to existing customers. Return customers are more
likely to trust the products and services your customer service team recommends because they
 have already had a great experience. If they have good experience in service, they are most
likely to return the progress of having loyal customers, which makes your business grow and
upgrade. It also reinforces the business value and brand. When the customer service is good and
communicates well with customers most likely makes the customer engaged, which results in
significant positive reviews, which leads to a positive public persona that can strengthen the way
people see your company, products, or services.

5. HAVING CATCHY UNIQUE DESIGN

People are into catchy and unique designs that other businesses do not have. We do not want
our design to have the same vibe as other companies. We want to have catchy designs to attract
customers. Catchy, unique design makes an excellent impression on the customers. We all know
some people have short attention spans, and we want their attention to be drawn to our
business by creating attractive designs.

As we already know, people make assumptions about your brand based on just a few seconds.
So, communicate effectively what you are selling and quickly attract the right customer. Every
single brand is based on a value or idea. But it is unlikely that a visitor to your website will focus
on your brand's mission statement. Instead, use imagery to give an idea of what is essential to
your company. You can do this by focusing on colors and relevant pictures. A poorly designed
website is not visited, read, or even trusted, which is why design matters! This is especially the
case when it comes to health websites. Consumers trust clear and simple layouts, easy-to-use
interfaces, and a color scheme that does not hurt the eye. The text should also be laid out in an
aesthetically pleasing manner.