MIRA FLEX ORGANIC BEAUTY & WELLNESS

Dipolog City

An Operation Management Paper

Presented to

JOHN MICHAEL J. ZAMORAS

INSTRUCTOR

In Fulfilment of the Requirements for the course

B2 Operation Management (TQM)

By:

Miralyn A. Almirol

June 10,2022
 OPERATIONS MANAGEMENT PAPER

I. Introduction

A. Background

The everyday exposure to heat and dust open us to risk of germs

and bacteria especially during this time of pandemic. These germs can put
us at risk of skin infections like rashes. We need a product that can both
benefits our beauty and wellness. Mira Flex will introduce to you the Mira
Neem and Papaya soap bar with the power of Neem which is renowned for
its antibacterial properties.The skin is the first line of defense from the
outside world, therefore personal hygiene is the first form of protection our
skin needs. Beauty and Wellness is one of a great investment for ourselves.
Mira Neem and Papaya soap is a product made a combination of Neem
and Papaya extract. Most soap include milk, natural oils or a Shea butter to
keep the skin mosturised for hours. The target customers of this product
focuses on women of all ages group above 18. These woman who are well
aware of beauty and care for their skin. The target consumers are local
shops, retailers, supermarkets and online retail stores.

B. Strategic Vision

• Mission
➢ Mira Neem & Papaya Soap creates and promotes the healthiest,
highest quality and most accessible personal care and household
products for you. By using pure organic and simple ingredients
with time- tested manufacturing processes for all of our
 products, we meet the needs of the future for people and the
planet.

• Vision
➢ Our vision is to have a significant, positive impact on the growth
of the personal care and household care marketplace where
safe and environmentally eonscious products prevail and where
there is a Mira Neem and Papaya Soap product in every home.

• Goals
➢ Mira Neem and Papaya Soap as a registered certified organic
soap manufacturer aims to guarantees 100% customer
satisfaction while maintaining the highest standards of
environmental protection in the making of our products.

• Objectives
➢ Our objective is to establish a high-quality soap manufacturing
firm that would provide the best and environmental friendly
product on the market by using only the finest and most
wholesome ingredients.

• Core Values
➢ Honesty and integrity, warmth and generosity at the core of our
Founders' value system as a family. We always hold fast to these
values no matter the impact on the growth of the business.
II. S.W.O.T Analysis
• Strengths
➢ Uniqueness of the technology and ingredients. Mira Neem and
Papaya soap is characterized by a moisturizing effect which
helps to preserve the natural beauty and health of the skin.
➢ It is made with Hypoallergenic. Consumers with hypersensitive
skin, and even those with normal skin may lead to believe that
these products will be gentler to their skin than non
hypoallergenic cosmetics.

• Weaknesses
➢ The pricing and limited target market which means that the price
of the product is higher comparing to the price offered by the
competitors.
➢ Besides, the product is oriented exclusively on the female
audience, while the creation of the male range within the offered
assortment can significantly increase the sales.

• Opportunities
➢ The creation of shampoo and conditioner can become a new step
in the brand and product development. The introduction of the
latest achievement in the technological process can serve as the
source of the various advantages on the market.

• Threats
➢ The constantly growing competition
➢ The economic influctuations can influence the purchasing power
of the customers decreasing the sales of the product.
III. Operations Plan

A. Product Design
Mira Flex will introduce to you the Mira Neem and Papaya Soap Bar,
with the power of Neem which is renowned for its antibacterial properties
helps to wash away germs to provide 100% better skin protection and helps
brighter the skin. The pictures below are the sample look of the product, the
sample material for the label, and the entire sample for the packaging.
 ➢ The soap is made from Neem tree extracts and oil which possess
powerful antiseptic, antibacterial, properties mixed with healing
properties of tulsi. The benefits of the product it to removes body
odour, kills germs, helps reducing pimples, rashes, reduces body
ache and improves skin texture. It is suitable for all types of skin.
➢ The target customers of this product focuses on men especially
women of all ages group above 18. These are those women who
are well aware about beauty and care for their skin. The want to use
quality products of the skin.
➢ Aside from the business itself which will market the said product,the
business possibly targeted consumers which are the local shops,
retailers, supermarkets and online retail stores.

B. Process Design
For the processing of the product, the fist step is to gathered all the
raw materials and make sure that all the materials are ready before the start
of the production. After that, prepare the machines/ equipment needed for
the molding and wrapping of the product. And lastly, making sure that the
materials used are properly estimated according to its measure and cost.

a. Gathered Data

Table.1 The data presented is the estimated measure of raw materials

used in producing the Mira Neem and Papaya Soap with its estimated
budget cost. This data is the estimated budget per production.

RAW MATERIALS ESTIMATED MEASURE ESTIMATED UNIT

COST
1.Virgin Coconut Oil 100 ml Php. 215.00
2.Fragrance 60 ml Php. 350.00
3.Neem Oil 50 ml Php. 250.00
4.Papaya Extracts 45 ml Php. 200.00
5.Sodium Palmate Lye 20 ml Php. 550.00
6.Water 65ml Php. 100.00
7.Labelling 50 ml Php. 250.00
TOTAL Php. 1, 915.00

Table.2 The data presented below is the total indirect cost of the
business in order for it to operate. It includes the labor,the packaging and
its estimated unit cost.
INDIRECT COSTS ESTIMATED UNIT
COST
1.Packaging 300PCS×15(per Php.4,500
packaging)
2.Rent Per month Php.10,000
3.Water Per month Php.1,100
4.Electricity Per month Php.2,000
5.Operational Machines Php.4,000

6.Labor 200 × 5(no. of staff) Php.1,000

TOTAL Php.22,600
C. Demand Forecasting

In order for the business to become sustainable in the long- run, the
demand forecasting is important to provides an estimate of the goods and
services that the customers will purchase in the foreseeable future. Considering
the Market Survey from the four different qualitative forecasting techniques it is
easier for me to defined those potential customers who will purchase regarding
the product and its value to the market.

Every production cost Php 1, 915 with the estimated ingredients

integrate. The estimated maximum production is 300 pieces by 60 grams. The
labor cost is 200 per production.

Forecasting the first year of the business, estimating by quarterly sales.

The supposed sales for the first month is Php 5,100. Estimating that the 300
pieces of Mira Neem and Papaya Soap has been all sold and the product cost
is 17 pesos(per 60 grams).

The business had predicted that the first quarter sales would be 21,565,
using the exponential smoothing with a weight of a=20.

QUARTERLY SALES FORECASTED SALES

1 21, 565 5,100
2 23,721.5 5,100+.2(21,565-5100) =
21,565
3 26,093.65 21, 565.2+ .2(23,721.5-
21,565)= 23,721
4 28,703.012 23,721.9+ .2(26,093.65 –
23, 721.9) = 26,093
D. Capacity Planning

Mira Flex Organic Beauty & Wellness is a start up business located

in Miputak,Dipolog City considering the capacity and competencies of the
owner from the said business. Determining the first production of the Mira
Neem and Papaya Soap, the estimated product produce are more than 300
pieces of the soap. The production line of the business operates 5 days a
week with an 8 hours per day.
Estimating the effective capacity for every production, it produces
300 pieces per production with 60 grams per pack.
With this data base the business decided to have 6 workers for the
starting of the business.

E. Location Planning

Based on the result, comparing the two locations between the factor-
rating method and Center-of- gravity method, the perfect site for the location
of the business is in Dipolog City. The two table shows the differences
between Dipolog,Dapitan and Sindangan according to its weights and
scores to evaluate alternatives location and method account to location of
markets,the volume of goods shipped to those markets, and the shipping
costs for finding the best location for a distribution.

Sample Table 1.The Factor-Rating Method

According to the table presented, the locations which have been
chosen for the build up of the business is in Dipolog,Dapitan and Sindangan
in which Dipolog got the highest total weighted scores of 59.75 and the
lowest is in Sindangan as it only got 41.75.
 KEY SUCCESS WEIGHT SCORES OUT OF 100 WEIGHTED SCORES

FACTOR DIPOLOG DAPITAN SINDANGAN DIPOLOG DAPITAN SIND

ANGA
N

LABOR .20 70 60 50 0.20×70=14 0.20×60=12 0.20×

50=10
AVAILABILITY
ATTITUDE .20 30 30 30 0.20×30=6 0.20×30=6 0.20×
30=6

HEALTH .25 50 30 25 0.25×50=12.5 0.25×30= 0.25×

7.5 25=6.
25

PER CAPITA .20 80 85 75 0.20×80=16 0.20×85=17 0.20×

75=15
INCOME
TRANSPORTATION .15 75 50 30 0.15×75=11.25 0.15×50=7.5 0.15×
30=4.
INCOME
5

TOTALS 100 59.75 50 41.75

Sample Table 2. Center- of – Gravity Method

LOCATION OF VOLUME OF GOOD SHIPPING COST
MARKETS SHIPPED
1.Dipolog City 5 boxes (per Panel) Php. 1,000
2.Dapitan City 5 boxes (per Panel) Php. 1,500
3.Sindangan 5 boxes (per Panel) Php. 2,500
F. Layout Planning

PROCESSING AREA

HALLWAY

OFFICE
STORAGE AREA
HALLWAY

TABLES

DISPLAY STORE TABLES

ENTRANCE
G. Facilities Layout
H. Design of work system and scheduling

I.Work System
The Mira Flex Organic Beauty and Wellness is a business who sell
and manufacture goods which consist of workers hired to produce and
evaluate the product. In order to operate and achieve the goal, the work
system is important as it allow everyday tasks to operate in a coordinated
manner and provide a basic framework to produce services and products.

The table presented below is the Gantt Chart for the first wee of work.
The working time is started at 8:00 in the morning and ends at 11:00 a.m.
The employees are given time for lunch and rest for at least one hour, back
to the working process exactly 1:00 in the afternoon and ends at 4:00 p.m.
The days of work for the production workers is only from Monday-Friday
while the auditor and distributer is from Monday to Saturday, hence,Sunday
is required for distributer to go for work, since they are task for the
distribution and delivery of the product.
I. Human Resource Management
The data presented is the specific job position of every person who
has a part of the business, it presents the job responsibilities, the time
period and the basic salary for each person.

JOB POSITION RESPONSIBILITIES PERIOD BASIC

SALARY
1.Production *feed raw material 8 hours a day Php. 200 per
Worker into machinery 5 days in a week production
*assemble good in
production line
*monitor the
production process
*pack goods for
shipping
*maintain equipment
and work areas
2.Auditor *identifying if and 8 hours a day Php. 550 per
where processes are 5 days in a week day
not working as they
should and advising
on changes to be
made.
*checking that
financial reports and
records are accurate
and reliable
*ensuring that assets
are protected
 *ensuring procedure,
policies, legislation
and regulations are
correctly followed
and complied with
3.Distributer *sourcing stock and 8 hours a day Php 200
negotiating the best 5 days a week
deals with suppliers
and vendors
*overseeing the
delivery, loading,
and unloading
products and goods,
and ensuring they
are safely
transported.
*performing regular
inventory check and
mantaining stock
levels

J. Quantity Management
Having an in -depth understanding of customers needs and local
soap making trends is the key to targeting the appropriate customer
segment.
After examining and identifying local emerging opportunities, Mira
Flex intends to reach out to customer’s who are looking for revolutionary
and unique products. The qualities that the business formulate for the soap
recipe includes; Bubbly, Cleansing, Hardness, Conditioning, fragrance and
creamy.
 K. Supply Chain Management

MIRA FLEX ORGANIC BEAUTY & WELLNESS SUPPLY CHAIN

RAW MATERIALS
MANUFACTURER
SUPPLIERS

PACKAGING &
DISTRIBUTER QUALITY
INSPECTION

WHOLESELLER &
CUSTOMER
RETAILER
L. Inventory Management

To achieve the main objective of inventory management, Mira Flex

needs to strike a balance inventory investment and customer service. The
following are the plans & strategy that are being formulated for inventory
management.
➢ Calculating the purchasing of raw materials, the lead time is
important which is the length of time between ordering the raw
materials and receiving them. Its important to simply knowing how
much I have of everything at all time and when a material will arrive
from time of purchase in order to avoid delay of production process.
➢ Avoid excess inventory is important especially that the business
focuses on soap making because of the seasonal product line
component in the industry.
➢ Excessive inventory: Finished Goods & Raw Materials
➢
❖ When the business find the excess of finished goods
inventory, the reaction will probably be to reduce the price and
sell quickly. Although this solves the overstocking problem it
of course reduces the return on investment.
❖ When the business find an excess of raw materials, it either
produce more of the main product line or get creative and offer
new, limited-time products to incentives sales and turnover
the excess materials, as long as it create a smart and efficient
plan to actualize the promotion.

➢ Create a tracking inventory, it is important to have a good inventory

tracking system, to tell what merchandise is in stock, what quantities
of all raw materials that the business have and what have sold.
 This is the Inventory Flow Chart of Mira Flex Organic Beauty & Wellness

PRODUCT/ ITEM

SALES PRODUCTION
PURCHASE

INVENTORY
TRANSACTION

INVENTORY
REPORTS
 M. Scheduling
➢ The set date for every processing of product is at least 7 days in a
week, from preparing the necessary ingredients used for the
production and setting up the workplace up to the last day which is
the distribution of the product.
➢ The proposed date for product launch is the day after setting up the
final output of the product, so basically, after a week of processing
the product the next week will be the product launch and ready to
display or deliver the product to the customers/ consumers.

N. Financial Statement/Costing
A . Estimated Sales Budget
Description Quarter 1 Quarter 2 Quarter 3 Quarter 4
Forecasted 5,100 21,565 23,721 26,093
Unit Sales
×Price Per 17 17 17 17
Unit
Total Gross 86,700 366,605 403,257 443,581
Sales
Total 2,000 5,000 6,000 6,000
Discount &
Allowances
Total Net Php. 84,700 Php. 361,605 Php.397,257 Php. 437,581
Sales
B.Recommended Pricing Structure and Set Prices

Total Raw Materials 1,915

Total Labor Cost per 1,000
person(production
worker) for one week
Estimated product made 300 pcs
per day

¶ 1,915 + ¶ 1,000 = ¶ 2,915

¶ 2,915 ÷ 300 = 9 (cost of good sold)
By estimating the mark up price which is 90% so,
9 (1+0.9) = ¶ 17 is the cost of every one pieces of
the Mira Neem and Papaya Soap with estimated of
60 per grams.
C. Income Statement
This is the sample income statement for MIRAFLEX ORGANIC BEAUTY
& WELLNESS. The Sales which you have seen below is the estimated
sales which is (300×17) = 5,100 multiplied by 12(months) for the estimated
year.

MiraFlex Organic Beauty & Wellness

INCOME STATEMENT
For the year Ended December 31,2023

SALES Php 61,200

Cost of Good Sold
Materials. 1,915
Salary Expense 800 2,715
OPERATING EXPENSES
Rent Expense 10,000
Utilities Expense 3,100
Repair and Maintenance 5,000 18,100
BUSINESS TAXES
Business Permit 150
Barangay Clearance 100
Sanitary Permit 500 750
21,565
NET INCOME Php 39,635