RICE PUTO FLAN PRODUCTION

A project feasibility study presented to the faculty of

Bicol University Polangui Campus

Polangui, Albay

In partial fulfillment of the requirements for the degree of

Bachelor of Science in Entrepreneurship

BIÑAS, RHODELYN H.
INTRODUCTION

This study attemps on producing Rice Puto with cheese in the top and leche flan on

the bottom.

Puto are Filipino steamed rice cake, traditionally made from slightly fermented rice

dough. It is eaten as is or as an accompaniment to a number of savoury dishes ( most

notably, dinuguan ), Puto is also a umbrella form for various kinds of indigenous

steamed cakes, including those made without rice. It is a subtype of kakanin ( rice cake,

rice Puto )

Cheese puto are little steamed cakes topped with cheese, It can be served with

butter or grated fresh coconut on the side and can be enjoyed anytime of the day.

Leche flan is a dessert that is essentially a caramel custard consisting of milk,

sugar, and egg, with addition of vanilla flavoring. It is usually oval shaped due to the use

of tin molds called llaneras. It is recommended to serve it chilled and coated with

leftover caramel syrup. It is very popular in celebrations and social gatherings.

Rice Puto Flan is a type of steamed "Rice cake" (Puto) and caramel (leche flan).

Leche Flan is traditional delicacy of the Filipinos ever since. It is caramel custard, made

with egg, milk, sugar and flavoured with vanilla. It originated from the rigions along the

France and Spain and was brought to the Philippines at the time of the Spanish

colonization. While in other hand, Filipino steamed cake or locally called as PUTO is

one the Staples in a classic Filipino gatherings. It is usually round shaped with either

cheese or salted egg toppings. It's texture is spongy and fluffy. Puto is traditionally

white, but can be colored pink, yellow, purple, and green.

 We come up to this business idea because it is not common in heaving Rice Puto

with combination of leche Flan, and Rice Puto Flan has a perfect combination that will

satisfy the costumer's craving. Aside from it , is that Puto and leche flan is on of the

most known delicacies. So that we decide that instead of original Puto we made it with

rice Puto for uniqueness. We thought that it would click to the costumer's since the taste

has its own distinguish and a unique complaxion when combined.

 EXECUTIVE SUMMARY

Name of Business : PUTO DE LECHE

COMPANY

Name of Product : BEST RICE

PUTO FLAN

Nature of the Business :

Manufacturing

Project Proponents : Rhodelyn H.

Biñas

Project Location :

Libon Albay

Type of Organization : sole

propraitorship

Total project cost :

Source of Financing : Owners

Equity

Return of Investment :

Cash payback period :

Project Implementation : JUNE

2022

Vision

To be known as having the best quality of product which served nutritious, delicious and

reasonable priced. To builed and maintain long term relationship with customers. To be leading

food industry that provides twist that truly satisfied the craving of everyone.

Mission

Best Rice Puto Flan is offering unique, sweet, and delicious attractive puto that will surely give a

twist to your taste buds. To inspire customer's to eat healthy and be lively. To serve high quality

product which will benifit and satisfy customer's need and wants.

Objectives

This feasibility study aims to:

1. Provide high quality Puto Flan with affordable price.

2. Gain profit

3. Excellent costumer service

4. To introduce new kind of Puto Flan

5. To expand the business operations in the whole province

6. To builed strong customer relationship through satisfiying them on our service and product

offering.

DESCRIPTION OF THE BUSINESS

The company name will be known as Puto De Leche company, using a Brand

name Best Rice Puto Flan. A company that producing a unique kind of Puto which is

Rice puto flan. Puto De Leche Company name comes from the product which is Puto

Flan, researcher combined it so that hearing the company name will known what

product is in that company. This is a partnership type of business. The owner name is

Rhodelyn Biñas. The proposed product of manufacturing site will be at Marayag Libon

Albay (near schools). Researcher choose this location because a lot of possible buyers

is in there. This business is a manufacturing business.

The Business project is a food processing type selling Rice Puto Flan. Puto is very

common to the people as a snack food. Leche Flan is also common to the people as a

dessert food. It is steamed Rice Puto combining with Leche flan and adding some

cheese on top. It will sell prepared in a box with pieces of Puto Flan depend on the
order of coatumers. The target market is people love to eat sweet like children and also

a person below 50 years old.

The source of finance is from owner equity. The proponent will hire one (1) product

worker and one (1) product helper/driver. This proponent will be the manager who

manage the entire activities within or outside the business. The general manager will

managed the entire activities within or outside of the business while production manager

will assist the production from the start of the operation to the end. This business will

known as a unique kind of snack or dessert food to the community. Puto De Leche

Company is offering unique, sweet, and delicious attractive puto that will surely give a

twist to your taste buds.

Market Study
The Product: it's uses and users

The proposed product of the Business is Puto Flan, which is known as a snack

food or a dessert food made with Rice flour Puto and Leche flan.

The Puto product has a different kind of color (red, white, yellow, green, etc.) This puto

flan is same as original size of common puto. Puto flan is just like A original Puto but it

has a different quality and texture of smoothness. It will be highly acceptable in terms of

appearance, taste and aroma. It will be packed in a box with the amount of pcs of puto

that costumers will buy. The product can be offered to everyone who has willing and

capability to buy.

The Bicol Best Rice Puto flan is made from Rice flour puto with combining of leche

flan and some cheese on top. It is a steamed Puto and last until 5-7 days by putting in

the refregirator. The Rice puto flan is Rich in vitamins A, vitamins V, iron, selenium,

phosphorus and calcium.

The Box is use for packaging the Puto Flan, the color is white. It is labelled based

on how many peaces of puto flan, the Ingredients and also the company name. The

uses of puto flan is more nutritious and healthier. It can be a snack food or dessert food.

The amount of puto in a box is depend on how many puto that costumers buy and the

price of puto flan per peaces is ₱15.59 .The target consumers are Libon, Polangui and

Oas.
DEMAND ANALYSIS

A demand analysis is an important test in identifying the needs of the customer and

their ability or capacity to buy the product. Demand analysis is determined by the

willingness of the buyers to purchase the product with the price offered.

To determine the target market, the proponent conducted a research in the three

selected municipalities.

Table 1

Projected Population

Year Libon Polangui Oas TOTAL

2022 71,592 89,736 74,112 235,440

2023 71,807 91,800 78,485 242,092

2024 72,022 93,911 83,116 249,049

2025 72,238 96,071 88,020 256,329

2026 72,455 98,281 93,213 263,949

Table 1 shows the projected population in the three selected municipalities in the

3rd District of Albay. The data presented is the actual number of population by
municipality. In order to get the population of the preceding year, the proponents used

the 2018, 2018 and 2020 as based years multiplied by growth rate of Libon (1.003%),

Polangui (1.023%) and Oas (1.059%).

Table 2

Market Potential

Year Projected % of willingness to Market potential

Population buy

2022 235,440 93% 218,959

2023 242,092 93% 225,146

2024 249,049 93% 231,616

2025 256,329 93% 238,386

2026 263,949 93% 245,473

The Table 2 shows the market potential of the proposed product to be able to get

the potential market, multiply the projected population to percentage of willingness to

buy which is 93%.

 Table 3

Projected Demand (in box)

Year Market Potential Average per capita Projected Demand

consumption

2022 218,959 133 29,121,547

2023 225,146 133 29,944,418

2024 231,616 133 30,804,928

2025 238,386 133 31,705,338

2026 245,473 133 32,647,909

The Table 3 shows the total demand for the product. Total population is multiplied

by the percentage of the willingness to buy and arrive with the target custumer is

multiplied by the average per capita consumption.

SUPPLY ANALYSIS
 Supply analysis is important to determine how much the demand is being filed by

compiting products and how much they satisfied the target market. It helped the

proponents in calculating how much market share the product can go further.

Table 4.1 (Libon)

Volume of supply of competing product

Competitor Compiting Daily Weekly Monthly Annually

s product

LCC libon Cheese puto 50 350 1400 16,800

Banana puto 30 210 840 10,080

Ranario Cheese puto 25 175 700 8,400

cake shop
Rice puto 20 140 560 6,720

Choco puto 25 175 700 8,400

Abila store Cheese puto 10 70 280 3,360

Rice puto 7 49 194 2,352

BOSDON Cheese puto 10 70 280 3,360

bakery
Banana puto 30 210 840 10,080

KYS Bakery Cheese puto 20 140 560 6,720

 TOTAL 76,272

Table 4.1 shows the supply of the competing product in Libon. The main distributor

of Puto. The considered direct competitors are LCC Libon, ranario bakery, Abila store,

BOSDON Bakery and KYS Bakery. To be able to get the monthly supply will bethe

number of days in a week, multiplied by four (weeks) and twelve (months) to get the

annual supply of the competing product that also offered by the proponents.

Table 4.2 (polangui)

Volume of Supply of Competing products

Competitor Competing Dialy Weekly Monthly Annually

s products

LCC1 Cheese puto 75 525 2,100 25,200

Polangui
Ube puto 35 245 980 11,760

Banana puto 35 245 980 11,760

LCC2 Cheese puto 75 525 2,100 25,200

Polangui
Banana puto 35 245 980 11,760

LCC Cheese puto 75 525 2,100 25,200

express

mart
 Bakers Cheeseputo 35 245 980 11,760

plaza
Ube puto 15 105 420 5,040

Choco puto 10 70 280 3,360

Carameputo 10 70 280 3,360

FC Cheese puto 25 175 700 8,400

Caramelputo 10 70 280 3,360

Goldilocks Cheese puto 80 560 2,240 26,880

Caramelputo 100 700 2,800 33,600

TOTAL 206,640

Table 4.2 shows the supply of the competing products in the municipality of

Polangui. The main distributirs of Puto are LCC1 Polangui, LCC2 polangui, LCC

express mart, Bakers plaza, FC and goldilocks.

Table 4.3 (Oas)

Volume of Supply of Competing product

Competitor Compiting Daily Weekly Monthly Annually

s product

Oas puto Cheese puto 75 525 2,100 25,200

 420

Rice puto 15 105 5,040

Peres Cheese puto 10 70 280 3,360

bakery
Banana puto 10 70 280 3,360

Rice puto 15 105 420 5,040

Rubio Cheese puto 25 175 700 8,400

bakeshop
Banana puto 25 175 700 8,400

Choco puto 50 350 1,400 16,800

TOTAL 75,600

Table 4.3 shows the supply of the compiting products in Oas. The main distributor

of Puto are Oas Puto, Peres bakery and Rubio bakeshop.

Table 4.4

Summary of some competing product

Target market Total Supply

Libon 76,272

Polangui 206,640
 Oas 75,600

TOTAL 358,512

Table 4.4 shows the summary of supply of the comprting products in the selected

establishment in three municipalities. The proponent are considering as the possible

competitors since they have similar product that are being offered in the market. Based

on the actual interview of possible competitors and co.piting product could help the

proponent to see how proposed product goes, and have a potential market.

Table 5

Projected Supply

Year Projected Supply

2022 394,363

2023 433,799

2024 477,179

2025 524,897

2026 577,387
 Table 5 shows the projected supply of the proposed product. To be able to get

the projected supply of competing products it is computed by multiplying the total supply

by 10% of increased average sale and added again to the projected supply.

Table 6

Demand and Supply Gap

Year Projected Projected Demand Projected Market

demand supply and supply volume share

gap

2022 29,121,547 394,363 28,727,184 28,800 10%

2023 29,944,418 433,799 29,510,619 31,680 11%

2024 30,804,928 477,179 30,327,749 34,848 11%

2025 31,705,338 524,897 31,180,441 38,333 12%

2026 32,647,909 577,384 32,070,525 42,166 13%

 The table 6 shows the demand and supply gap per year. To determine the

demand and supply gap, projected demand of the proposed product it was subtracted to

projected supply of the competing product, Market share is through dividing the annual

production volume of the proposed product to the demand and supply gap. Based on

the computation the Market share is increasing every year.

Table 7

Projected Sales

Year of Production Allowance Sale Unit selling Gross sale

operation volume (per for spollage volume price

peaces of
(0.01%)
puto flan)

2022 28,800 288 28,512 15.59 444,502

2023 31,680 317 31,363 17 15 537,848

2024 34,848 348 34,500 18.86 650,795

2025 38,333 383 37,950 20.75 787,467

2026 42,166 422 41,744 22.83 952,828

 Table 7 shows the projected sales volume of the proposed product in the first 5

years production. The production volume is multiplied by 0,01% allowance for spoilage

and then deducted to the production volume to get the sales volume.

The selling price of the proposed product will increase 10% per year because it

assumed that the raw materials and other supplies used in production is also

increasing.

The business has 0.01 assumption for spoilage because it is possible that the certain

products can have damages.

MARKETING PROGRAM AND STRATEGY

Product positioning

The proposed product is Rice Puto Flan. It is a type of food production business.

The product will be positioned in lined with cheese puto, banana puto and other kind of

puto. The proposed product "Best Rice Puto Flan" is highly acceptable in terms if

appearance, taste, aroma and texture. The finished product will be produced in a box

with the right amount of Puto Flan.

The aforcited proposed product is best for occations or for snack food. The

proponent assured that the product is given reasonable price and more afforedable in

the market.
 Figure 1. Product Label

Pricing scheme

Entrepreneurs will always desire to get more profit for all sales of product. The

product will be solds through its engridients cost used to create the product plus its

mark up. The cost is according to the expense during the procurement of raw materials

or its engridients up to the preperation of the product plus the mark-up are also being

added too. The price of the product depends on the raw materials used in producing the

product and it is assumed to increase the selling price annually because of the demand

and it is possible to increase the cause of raw materials. The proposed product will be

offered ₱15.59 per Rice Puto Flan and will put in a box.

Promotional Strategy

Product promotional is an important factor in operating the Business, because it

helps to increase profit. Promotion for any product or service is essential for any

company. Because only through promotion, people would come to know about the

product. Only after knowing the product they consider purchasing. It will also help to

introduced the proposed product in tbe market and used to persuade costumers that the

product is better than the competing products

 The proponent deliberated some strategies to penetrate the market. The proponent

will promote the product through internet selling, posters and flyers to attract the

costumers and persuade them to patronize the product.

Distribution channel

The proponent adopt a simple Flow for distribution wherein the producers are going

to deliver the product to the different market site of the target market area which are the

bake shops, store and to those people who ordered the proposed product.

The distributors on the other hand are the one's responsible for making the product

available to the target matket and to the consumers

 Producer

Store, bake shops,

events

Consumers
Distribution Channel
 TECHNICAL

STUDY

PRODUCT SPECIFICATION AND COMPOSITION

The business will engage in production of Rice Puto Flan. It is very acceptable in

terms of appearance, taste, aroma and texture. The finished product will be put in a box

with 10pcs of puto flan and labled of sticker bearing the information of the proposed

product. Per puto flan is for Php 15.59.

The engridients of the proposed product are Rice flour, baking powder, white sugar,

eggs, salt, evap milk, condensed milk, calamansi and butter. The process of the

engridients is easy to perform.

PRODUCTION PROCESS

The folloeing are the engridients of rice puto flan.

For Flan:
  Egg yolks

 Condensed milk

 Calamansi juice

 Butter

The following are the process on how to make the Flan in Rice Puto Flan.

1. Brush puto molds highly with melted butter.

2. In the small bowl, combine egg yolks, condensed milk and calamansi juice. Whisk

until well combined.

3. Pour flan into the molds, about ⅓ full.

4. Place molds in the steamer over low heat for about 7-8 minutes. ( Make sure water in

the steamer is already boiling before placing the molds ).

5. Remove from the steamer and allow to cool.

RICE CAKE INGREDIENTS:

 Rice flour

 Baking powder

 White sugar

 Salt

 Egg whites

 Evaporated milk

 Water
  Cheese

The following are the process on how to make the Rice cake or the Rice puto flan.

1. Sift all dry ingredients (flour,baking powder, sugar and salt). Whisk to combine.

2. Add water, evaporated milk and egg whites. Whisk until the mixture become smooth

and creamy.

3. Pour puto mixture on top of the steamed flan , about ¾ full and put a bit of cheese as

topings.

4. Place the molds into the steamer and steam puto mixture on low heat for about 10

minutes or until an inserted toothpick comes out clean.

5. Remove from the steamer and allow to cool down a bit before gently removing the

rice puto flan from molds.

6. Serve it to the costumers.

 Egg yolks, condensed milk,
Butter
Clamansi juice

Melt Mixing Steaming

Rice flour, baking Water, evap

Cheese
powder, sugar, salt milk, egg white

Set aside

Pour to steamed
Mixing Whisks flan

Legend:
Steaming

Materials Finished product

Operations. Delivery

Boxing

Finish product

Labeling
Figure 3

Rice Puto Flan flow chart

PRODUCTION VOLUME AND SCHEDULE

 The Business operation will be 6 days a week from monday to saturday, sunday is

the rest day of the employees. The operation will start at 8:00 in the morning and end at

5:00 in the afternoon, including 1 hour lunch break and 30 minutes snack time.

Table 8

Production Volume

Year Monthly Annually

2022 2,400 28,800

2023 2,640 31,680

2024 2,904 34,848

2025 3,194 38,333

2026 3,513 42,166

Table 8 shows the production volume of the proposed product for 1 month.

Assume that the production volume will increase by 10% annually in the five

consecutive years.

Table 9
 Production schedule

Mon Tue Wen Thur Fri Sat

8am

9am

10am

11am

12pm

1pm

2pm

3pm

4pm

5pm

Table 9 shows monthly opperations of the proposed business. Week 1 on the

first and second tray will be procurement of raw materails and the remaining week will

be production and same time of delivery day of the product. Saturday will be house

keeping day.

Legend:
 Procurement v delivery

Production house keeping

RAW MATERIALS REQUIREMENTS

The raw materials needed in the production of rice puto flan are, Rice flour, egg,

condesed milk, evap milk, calamansi, butter, baking powder, sugar, salt and cheese.

The needed materials are available in the locality and can be brought in neighbors.

Table 10

Raw Materials Requirement

Particulars Quantity Unit Unit cost Monthly Annually

Rice flour 1 Kilos ₱40.00 ₱960.00 ₱11,520.00

Condensed 1 Pcs. 32,00 768.00 9,216.00

milk

Evap milk 1 Pcs. 32.00 768.00 9,216.00

Calamansi ⅛ Kilo 20.00 120.00 1,440.00

Egg 3 Pcs. 7.00 588.00 7,056.00

 Baking ⅛ Kilo 20.00 60.00 720.p00

powder

Sugar ½ Kilos 42.00 588.00 7,056.00

Salt ¼ Kilo 20,00 140,00 1,680.00

Cheese 1 Pcs. 30,00 840.00 10,080.00

Butter 1 Pcs. 25.00 700.00 8,400.00

Total ₱5,532.00 ₱66,384.00

Source: Polangui public market

Table 10 shows the raw materials requirements needed in the production of the

proposed product.

Table 11

Packaging Materail

Particulars Quantity Unit Unit cost Monthly Annually

Sticker Labe 140 Pcs. ₱5.00 ₱2,400.00 ₱28,800.00

Box(good for 140 Pcs. 7.00 3,360.00 40,320.00

10pcs. Of

puto

TOTAL ₱5,760.00 ₱69,120.00

Source: alvarado and malonda computer shop

Table 11 shows the packaging neede in the proposed product. The total cost

annually is also shown.

PRODUCTION EQUIPMENT, TOOLS AND UTENSILS

In a production type of business, production equipment and tools and utensils are

necessary in the production. Equipment are presented below eith its corresponding unit

cost based on the actual survey done by the proponent.

Table 12

Production Equipment

Particulars Quantity Total cost Estimated Annual

useful life depreciation

Aluminum 2 ₱2,299.00 5 yrs. ₱459.80

steamer

Gas stove 1 1,599.00 5 yrs. 319.80

Whisking 2 2,000.00 5 yrs. 400.00

Machine

TOTAL ₱5,898.00 ₱1,179.60

Source: Lcc polangui

 Table 12 shows the production equipment needed in the production of rice puto

flan. The equipment is subjected for annual depreciation since the estimated life is more

than a years.

Plate 1

Aluminum steamer

Function Steaming

Model number SKU. 112737

Hieght 5½ incher

Specification 30 cm

Capacity 4.5 gallons

 Plate 2

Gas Stove

Function Precise temperature control

Model Hanabishi

Model number US-1000G

Voltage 120 volts

Cavity volume 200 lt

Weight 130 pounds

Power 1000 BUTs

 Plate 3

Whisking Machine

Function Mixture

Wattage 350 watts

Electricity speed 5speed

Weight 1 gram

Capacity 5.5 quarts

Power 600 W

Voltage 220
 Table 13

Production tools and Utensils

Particulars Quantity Unit Unit cost Total cost

Stainless tray 2 Pcs. ₱105.00 ₱210.00

Mixing bowl 5 Pcs. 50.00 250.00

Measuring cups 2 Set 150.00 300.00

Good tong 1 Pc. 75.00 75.00

Puto molds 150 Pcs. 5.00 750.00

TOTAL ₱1,585.00

Source: 168 and polangui public market

Table 13 shows the tools that are needed in the production of the product. In the

table above the total cost is presented. That is based on the survey of the proponent.
 Table 14

Production Supplies

Particulars Quantity Unit Unit cost Total cost

Face mask 20 Pcs. ₱20.00 ₱200.00

Hairnet 20 Pcs. 20.00 400.00

Apron 10 Pcs. 45.00 450.00

Hand towel 15 Pcs. 20.00 300.00

Gloves 20 Pairs 30.00 600.00

TOTAL ₱1,950.00

Source: Lcc polangui and Novo

Table 14 shows the production supplies that will be used by the workers in the

production of the proposed product. To get the total cost multiply the unit cost by the

quantity.
 Table 15

Housekeeping Supplies

Particulars Quantity Unit Unit cost Total cost

Dust pan 2 Pcs. ₱75.00 ₱150.00

Trash can 3 Pcs. 150.00 450.00

Floor mop 4 Pcs. 100.00 400.00

Hard broom 3 Pcs. 20.00 60.00

Soft broom 3 Pcs. 120.00 360.00

Pail 3 Pcs. 50.00 150.00

Dipper 3 Pcs. 25.00 75.00

Dish scrubber 3 Set 30.00 90.00

Dishwashing 2 Pcs. 120.00 240.00

liquid(1.5 liters)

Hand soap 20 Pcs. 18.50 370.00

TOTAL ₱2,345.00

Source: polangui public market and Lcc

Table 15 shows the housekeeping supplies that will be used in cleaning the

production area. The total cost is presented in the table above.

 Table 16

Production Furniture and Fixture

Particulars Quantity Unit Unit cost Total cost Estimate Annual

d useful depreciatio

life n

Working 2 Pcs. ₱5,000.00 ₱10.000.00 5yrs ₱2,000.00

table

Chair 5 Pcs. 450.00 2,250.00 5yrs 450.00

monobloc

Ceiling fan 2 Pcs. 1,399.00 2,798.00 5yrs 559.60

Fire 1 Pc. 1,700.00 1,700.00 5yrs 340.00

extinguisher

TOTAL ₱16,748.00 ₱3,349.60

Source: 168 polangui and Lcc home center

Table 16 shows the Furnitures and fixtures of the proposed product. The estimated

useful life and the annual depreciation is presented.

 Table 17

Delivery Equipment

Particulars Unit cost Estimated useful Annual

life depreciation

Multicab ₱100,000.00 10 yrs ₱10,000.00

Total ₱100,000.00 ₱10,000.00

Source: motor trade

Table 17 shows the delivery equipment that will be used for the distribution of the

proposed product to their respective target market.

Table 18

Fuel expense

Particulars Quantity Unit Unit cost Monthly Annually

cost cost

Gasoline 10 Litters ₱47.50 ₱1,900.00 ₱22,800.00

Total ₱1,900.00 ₱22,800.00

Source: bastian gasoline station

 Table 18 shows the delivery expense with the corresponding unit cost per liters. To

compute the delivery expense, multiplied 10 quantity to each unit cost which is 47.50

and to get the annual cost multiplied by 12 to get the annual amount which is ₱

5,700.00.

QUALITY CONTROL SCHEME

Quality control is a process through which a business seeks to ensure that the

product quality is maintained or improved. Quality control required the company to

create an invironment in which both management and employees strive for perfection.

Quality is about the quality as well as the correct specification of the product.

First thing to consider in quality control is purchasing raw materials make sure that

the raw materials must be qualified in appearance.

Another thing is considering the handling of the tools and utensils that are used in

production and the maintenance of the other equipment. It must be inspected before

and after the operation. The proposed business must also observe the proper sanitation

of the product area.

The finished product will be pack right away according to the amount of pieces of

the product in a box. Proper packaging and labeling will be observed. Management and

employees should practice discipline to produce large volume of products and make a

big sale.
PLANTLOCATION LAYOUT

Marayag Libon Albay is the proposed operation site of the business. It is the first

Brgy. of Libon from Polangui. It is choosen because, it is good location for business.

The plant layout is designed depending on the flow of the production. It is devided into

different areas; office area, production area, production and office supply area, storage

area and comfort room. The production area is given more space in order the worker

can move freely and conveniently. It is shown in figure 6.

 imperial
Brgy.
Libon town
Tubog
center

LIBON POLANGUI

Gasoline
MARAYAG
station

Puto De
TO SAN ISIDRO
Leche
Company

TO OAS TO OAS Marayag

E/S

Figure 4

Vicinity Map
 Figure 5

Building perspective
 Figure 6

Floor Plan
UTILITY REQUIREMENTS

Electricity requirement is one of the most important factor to consider in the

operation of the business. It can be used for other equipment of the propose business.

The power will be supplied by the APEC.

Water is required source for business. It is very important specially in the

production process and the maintenance of the cleanliness of the production area. The

water supplies are available in the area.

Table 19

Utility Requirements

Utility Production Administrative

Per month Per year Per month Per year

Electricity ₱2,200.00 ₱26,400.00 ₱800.00 ₱9,600.00

Water 30.00 360.00

Internet 720.00 8,640.00

Total ₱2,230 ₱25,760.00 ₱1,520.00 ₱18,240.00

Table 19 shows the cost of Utility requirements needed in the operation of the

business.
BUILDING FACILITIES

The proponent will rent a store building for the proposed business amount of ₱

2,500.00 per month. It was well ventilated area and a good area for business.

The building will be devided into different areas; office area, production area,

production and office supply area, storage area and comfort room area. An estimated

renovation cost of tbe building is amounted to ₱ 23,125.00.

Table 20

Bills of Materials and cost estimated of the Building Renovation

Particulars Quality Unit Unit cost Total cost

Plywood 7 Pcs. ₱400.00 ₱2,800.00

Coco lumber 10 Pcs. 480.00 4,800.00

Nail#2 1 Kilo 60.00 60.00

Nail#3 1 Kilo 50.00 50.00

Wall paint 2 Galon 1,850.00 3,700.00

Roller brush 2 Pcs. 100.00 200.00

Door knob 4 Pcs. 170.00 680.00

Paint brush 3 Pcs. 45.00 135.00

 Concrete nail 1 Kilo 70.00 70.00

Roofing 5 Pcs. 450.00 2,250.00

Cement 4 Bags 220.00 880.00

Fluorescent 4 Pcs. 300.00 1,200.00

Labor (3 labor x 6,300.00

350 x 6 days)

TOTAL ₱23,125.00

Source: Alden hardware

Table 20 shows the bills of materials and cost estimated of the building renovation

including the labor salary amounting ₱ 6,300.00 for 6 days working. The total cost

renovation of building is amounting ₱ 23,125.00. with estimated life of 10 years. Annual

depreciation amount to ₱2,312.50.

WASTE DISPOSAL SCHEME

Having a proper waste disposal can result a good environment as well in the

business. Waste disposal refers, quite simply to the way in which you dispose of your

waste. In running a business, it is important to care and to ensure that waste is

disposed of safely and securely.

Biodegradable and Non-biodegradable waste should be discarded in two different

dustbins so that they can be collected saperately.Those that can be recycled will be
grouped for the appropriate waste management intended to it. The water being used will

be disposed properly through a good draignage system.

 Waste Disposal

Biodegradable
Recyclable Non-Biodegradable

Figure 7

Waste Management
MANPOWER REQUIREMENTS

The proposed business will operate eight (8) hours a day. It need a employees in

managing and operating the business. It will require (2) employees; production worker

and helper/driver. The employees will recieve a salary of ₱300.00 a day. They are

considered as a regular employee and will also recieved Fringe Benifits and 13th month

pay.

Table 21

Salaries of Workers

Position Salary Rate

Day Month Year

Worker ₱310.00 ₱7,440.00 ₱89,280.00

Driver 310.00 7,440.00 89,280.00

Total ₱620.00 ₱14,880.00 ₱178,560.00

Table 21 shows the salary of the workers. It is based on the salary wage in the

current regional daily minimum of region 5 which is imposed by the Department of Labor

and Employment as of March 2020.

 Table 22

Fringe Benifits of Worker

Position SSS Pag-ibig Philhealth 13th

month
Per Per year Per Per year Per Per year
pay
month month month

Worker ₱400.00 ₱4,800 ₱148.80 ₱1,785.60 ₱130.20 ₱1,562.40 ₱7,440

Driver 400 4,800 148.80 1,785.60 130 20 1,562 40 7,440

Total ₱800 ₱9,600 ₱297.60 ₱3,571.20 ₱260.40 ₱3,124.80 ₱14,880

Table 22 shows the Fringe benifits of the workers. The benifits that can recieve is

based on agencies contribution table.

ADMINISTRATIVE SALARY, SUPPLY AND EQUIPMENT

The proponents well be needed an administrative employees to help them in

managing the business most convinienthly. The proponent will hire two (2) managers,

the production manager and general manager. Each of them will having a salary of ₱

425.00 per day which is equivalent to ₱10,200.00 per month and also receive a fringe

benifits: SSS, Pag-ibig, philhealth and 13th month pay.

 Table 23

Salaries of Administrative

Position Salary Rate

Per month Per year

Production manager ₱10,200.00 ₱112,400.00

General manager 10,200.00 112,400.00

Total ₱20,400.00 ₱224,800.00

Table 23 shows the salaries of the administrative employee. Production manager

will work six (6) days a week with salary work of ₱ 425.00 a day. The salary per month

is presented.
 Table 24

Administrative Fringe Benifits

Position SSS Pag-ibig Philhealth 13th month

pay
Per Per Per Per year Per Per year

month year month month

General ₱465 ₱5,580 ₱204 ₱2,448 ₱178.50 ₱2,142 ₱10,200

manager

Productio 465 5,580 204 2,448 178.50 2,142 10,200

manager

Total ₱930.00 ₱11,16 ₱408.00 ₱4,896.00 ₱357.00 ₱4,284.00 ₱20,400.00

0.00

Table 24 shows the administrative Fringe Benifits received by the production and

general manager.
 Table 25

Office Equipment

Particulars Quantity Unit price Total price Estimated Depreciatio

useful life n

Computer 1 set ₱20,000.00 ₱20,000.00 10 yrs ₱20,000.00

desktop

₱20,000.00 ₱20,000.00

Source: willy and sons

Table 25 shows the equipment needed in the administrative office. The office

equipment is amounted to ₱20,000.00.

 Table 26

Office supplies

Particulars Quantity Unit Unit cost Total cost

Bond 1 ₱130.00 ₱130.00

paper(500

sheets)

Ballpen 2 Box 40.00 80.00

Calculator 2 Pcs 100.00 200.00

Record book 1 Pc 25.00 25.00

Stapler #10 2 Pcs 45.00 90.00

Sales invoice 10 Stubs 35.00 350.00

Wall clock 1 Pc 250.00 250.00

Glue 3 Pcs 20.00 60.00

Scissors 2 Pcs 20.0 40.00

Fold back clip 20 Pcs 3.00 60.00

Stapler bullet 10 Box 10.00 100.00

Total ₱1,385.00

Source: maxi pro and Novo

 Table 26 shows the supplies needed in the administrative office. The total cost of

office supplies is ₱1,385.00.

Table 27

Office furniture and fixtures

Particula Quantity Unit Unit cost Total cost Estimate Annual

s d useful depreciatio

life n

Office 2 Pcs ₱2,599.00 ₱5,198.00 5 yrs ₱1,039.60

table set

Ceilling 1 Pc 1,399.00 1,399.00 5 yrs 279.80

fan

Monobloc 4 Pcs 450.00 1,800.00 5 yrs 360.00

chair

Filing 1 Pc 1,599.00 1,599.00 5 yrs 319.80

cabinet

Total ₱9,996.00 ₱1,999.20

Source: 168 polangui and Lcc home center

Table 27 shows the furniture and fixture of the proposed business. The total cost of

annual depreciation is presented.

PRODUCTION UNIT COST

DIRECT COST

Raw Materials

₱9,480.00

Packaging Materials

37,620.00

Direct Labor and Fringe Benifits

194,809.60

Total Direct Labor

₱241,909.60

FACTORY OVERHEAD

Production tools and utensils

₱1,585.00

Production supplies

1,950.00

Utility Expense

26,760.00

Housekeeping supplies

2,345.00
Rent Expense (75%)

22,500.00

Depreciation

Building Renovation (75%)

1,734.38

Production Equipment

1,179.60

Production Furniture and Fixture

3,349.60

Delivery Equipment (10%)

5,000.00

Total Factory Overhead Cost

₱66,403.18

TOTAL PRODUCTION COST

₱308,313.18

Delivery by: production Volume

28,800.00

Product

Unit cost

₱14.35
Add: mark up (30%)

1.24

Estimated selling price

₱15.59.00
ORGANIZATION

AND

MANAGEMENT

STUDY
FORM OF BUSINESS ORGANIZATION

The type of Business organization that the proponent decided to adopt is a Sole

proprietorship. Sole proprietorship is a type of business entity that is owned and run by

one individual and in which there is no legal distinction between the owner and the

business.

A sole proprietorship is the simpliest and most common structure chosen to start a

business. It receives all profit and an unlimited responsibility for all loses and depts.

ORGANIZATIONAL STRUCTURE

The proposed Business will require (2) workers. One will be the production worker, one

will be the assistance of the production worker.

Manager (1) and (2) will be the owner and manager in all business transactions the job

is equally devided to them, Figure 8 below shows the organizational structure of the

proposed business
 FIGURE 8

Organizational Chart

Administrative Production
Manager Manager

WORKER 1 WORKER 2
DUTIES AND RESPONSIBILITIES

ADMINISTRATIVE MANAGER

1. Cashier, responsible in bookeeping and marketing of the production

2. Responsible for hiring and training of workers

3. Capital provider

4. Planner and goal setter of the business/responsible in all activities in the

administrative area.

PRODUCTION MANAGER

1. Responsible for monitoring worker in running the business

2. Performs supervision of the production area

3. Capital provider

4. Double checks the quality and quantity of the product before delivery

5. Responsible in quality control and evaluation in the production of products.

WORKER 1

Job description

1. Perform the proper production process of the product

2. Responsible for safekeeping of the production area and Equipment

3. Ensure and maintains every unit produced

4. Maintain proper storage of the product

5. Responsible in packaging the finished products

WORKER 2

Job description

1. Assist the worker 1 in the production of the proposed product

2. Responsible in getting orders from the customers

3. Assist the worker 1 in packaging the finished products

4. Maintain cleanliness in the production area

5. Collects the raw materials

QUALIFICATIONS

 Male/ female

 Must be at 20 years old and above

 With knowledge in cooking

 Efficient, hardworking, honest and can work in longer hours

 Can work under the guidance and supervision

 Must be in good and neat looking

 Can work fast

FINANCIAL

STUDY
Financia Assumption

1. Working capital will be computed for 1 year.

2. Selling price will increase by 10% annually.

3. Production volume will increase by 10% annually.

4. Raw materials and Packaging materials are assumed to increase 2% annually.

5. The cost of Utilities is assumed to increase by 2% annually.

6. Cost of Electricity consumption is assumed to increase 5% yearly.

7. Tools and utensils, and housekeeping supplies are assumed to increase 2% annually.

8. Administrative supplies will increase 2% annually.

9. Fuel Expense will increase 2% annually.

10. Direct Labor is fixed for the next five years.

11. Administrative salary is fixed for the next five years.

12. Rent expense will be fixed ₱ 2,500.00 monthly and it is pro-rated at 75% for production and

25% for administrative.

13. Advertising expense is ₱2,000.00 fixed.

14. the owner will provide the capital and have the profit and losses.