Falcataria Business Plan

Created by:
Morta, Mice Dianne M.
Table of Contents

I. Executive Summary
II. Problem Statement
III. Falcataria Solutions
IV. Market Research and Analysis
V. Marketing and Sales
VI. Operations Plan
VII. Financial Statements
VIII. Appendix

I. EXECUTIVE SUMMARY
 The future of the wood-based industries depends largely on the success

of industrial tree plantations. In the Philippines, CARAGA REGION is known as

the "TIMBER CORRIDOR" which is considered the leading producer of timber in

the country which covers 684,503 hectares (ha) of forest lands. According to

Census of Agriculture, the estimated number of falcata farm in the Philippines is

109,220.

Falcata tree as one of the most in-demand wood which is used in manufacturing

of plywood and paper will be the focus of this app. Falcata tree farming offers an

investment opportunity and alternative way of life that is most beneficial to

upland farmers. Even families with small landholdings in upland areas can

establish backyard tree plantation.

Falcataria is mobile application that offers users specifically tree farmers a

guide in falcata tree farming which will also help them in improving their

productivity and tree farming experience. The app enables the users to scan the

soil if its suitable to plant falcata and it also notifies the users on what they need

to do to in order to keep their trees healthy. Through the use of this mobile

application, tree farmers will never have a hard-time in managing and monitoring

their trees.
Objectives

Falcataria aims to help thousands of tree farmers and small landholdings

farmers to educate and guide them in proper crop management. This mobile app

is in line with the government’s project “Conservation agriculture with trees” or

CAT, which aims to provides the benefit of additional income to farmers while

protecting the environment.

Business Model

The target market of Falcataria are the tree farmers who owns forest or
plantations that are managed for timber production. The Falcataria will help
promote the Department of Agriculture project which is in line with the President
Rodrigo R. Duterte’s vision of green and sustainable agriculture.
II. PROBLEM STATEMENT

One of the problems faced by the Philippines’ wood industry is the low

field survival rate because of the absence of management intervention after field

planting. Tree survival and information gap are just a few of the problems that

our tree farmers are facing right now. Since tree farmers don’t have all the

information, they need in tree farming specifically how to grow and manage

falcata tree they will be needing some help and because of the modern day

these tree Farmers needs modern way to help them in planting and taking good

care of their trees.

III. FALCATARIA SOLUTIONS

This mobile application works as their companion which will provide them

decision support system and guidance for tree farmers in planting and managing

their trees.

One of the factors that needs to be considered in planting falcata is

determining the characteristics of the soil because different trees will thrive in

different type of soil. Falcata, tagged as a nitrogen-fixing tree which improves a

site’s soil condition, is said to be best if grown in planting sites where average

rainfall is high, elevation areas low enough or around 600 meters above sea

level, and the soil is moderately deep.

 Falcataria offers the following features to the users:

1. Provides information/guide starting from planting up to crop management

practices

2. Scans the soil to check the quality and status if its suitable to plant falcata

3. Suggest best spots to plant and alternative crops to plant if the soil or spot is

not suitable for falcata

4. Notifies/reminds the user on what they need to do to keep the crops healthy

The Falcataria will use the Opt-In Free trial model which means that the

user can use the app free of charges for a limited time. After a month of trial, the

user will pay PHP 120 every month to continue using the mobile app.

IV. MARKET RESEARCH AND ANALYSIS

There is a strong demand and a stable market among many factories in

Mindanao that use softwood species, especially falcata, in the manufacture of

plywood and paper. According to Census of Agriculture, the estimated number of

falcata farm in the Philippines is 109,220 and CARAGA REGION is the leading

producer of timber in the country that has 684,503 hectares (ha) of forest lands.

In 5 years, falcata trees are fully grown and can be sold for PHP 2,000 per tree

so imagine planting 500 trees in one hectare, a farmer can earn PHP 1 million

and if he allows it to grow more he can earn PHP 12,000 for every falcata tree.
 The potential users for the Falcataria app will be the tree farm owners and

farmers with small land holdings who want to start falcata farming business.

According to Indufor Group, smallholder tree planters rarely have access to

technologies required for profitable, industrial-quality tree planting and this needs

to be addressed with a combination of material and financial incentives and

technical advisory support.

There are companies who offers crops management system but are

costly. One of these is the DataGreen company that offers crop management

system which has features similar with Falcataria.

As shown from the above figure, compared to DataGreen system the

Falcataria has a lot offer and is very accessible since it’s a mobile app so it is
very handy. Both of them were established to help farmers in monitoring their

crops, but the Falcataria offers more than just a system. The Falcataria was

created to promote and help even small land holding owners to start falcata

farming because according to Agriculture Secretary Emmanuel F. Piñol, farmers

could make more money by planting trees.

V. MARKETING AND SALES

The Falcataria app will be available and free to download from the Google

Play Store and Apple App Store. The first goal of the app is to find potential

users and this can be obtained through attending and participating on public

speaking or seminars. Through this, the app will gain exposure and find potential

users. I also want to proposed the Falcataria to the Department of Agriculture

because I believe that they need the app to accompany and help them with their

new program “Conservation agriculture with trees” or CAT which has the mission

to ensure the protection of water sources for sustainable agriculture through tree

farming.
 The Falcataria will use the Opt-In Free trial model which means that the

user can use the app free of charges for a limited time. After a month of free trial,

the user will pay PHP 120 each month to continue using the app. Assuming that

these 109,220 farmers will use the app, the app can earn 13,106,400 in just a

month.

VI. OPERATIONS PLAN

Founder/Owner
Mice Dianne M. Morta

Graphic Front-end Back-end

Designer Developer Developers
 The roles of the personnel involved are as follows:

 Founder/Owner – he’s the one responsible to lead the team and in order

to do this he also has to develop strategic plan on how to meet the

objectives of his start-up. He is also responsible for handling of the

financial management of the company.

 Front-end Developer – a client-side programmer who’s responsible for

developing everything the users sees and interacts with Falcataria.

 Back-end Developers – Falcataria needs two back-end developers

because they’re the ones responsible for the server-side, database, and

future maintenance.

 Graphic Designer – the designer will create the overall layout and

production design for Falcataria.

VII. FINANCIAL STATEMENTS

 The figure above shows the percentage of each structure for developing

the Falcataria above. The figure was also based on the first initial start-up plan

and you can see that the salaries has the biggest amount needed in creating

Falcataria. The table below will show the actual and specific cost or budget

needed for each expense.

START-UP EXPENSES TOTAL COST

Devices for testing PHP 15,000

Graphic Designer PHP 35,000

Front-end Developer PHP 45,000

Two (2) Back-end Developers PHP 100,000

Advertisement/Market Campaign PHP 30,000

Office rent PHP 12,000

Utilities

 Internet Service Provider

PHP 35,000
 Water

 Electricity

 Cloud Service

Legalities

 Trade Marks/design/patents
PHP 50,000
 Contingency Fund
 Tax/Registration

The estimated start-up cost for Falcataria would be PHP 322,000 and it is

also the amount required for the first month of Falcataria development. The

table below will show the assumed income statement for the first month of

deployment of Falcataria.

Assuming that these 109,220 tree farmers will use the Falcataria app then

it will earn PHP 13,106,400 in just a month. But what if only 10% of the assumed

target users will really pay or continue using the Falcataria so that will make the

app earn PHP 1,310,640 in a month so the start-up cost will be fully repaid in just

a month. The annual income of Falcataria is PHP 15,727,680. If the monthly cost

is subtracted (PHP 177,000 x 11(months) + PHP 322,000 = PHP 2,239,000) to

the annual income of Falcataria, then that would be PHP 13,488,680. The return
on investment (ROI) for the first 5 months is PHP 4,212,560 which is big enough

pay back the initial start-up investment for five(5) months which costs PHP

1,030,000.

VIII. APPENDIX

Falcataria is a mobile application that was conceived by Mice Dianne

Morta, a BSIT student from University of Southeastern Philippines and this

Business Plan was created as a guide on how to manage and start this start-up

project. Said person can be reached through email at micedianne@gmail.com or

through Facebook at facebook.com/micedianne.morta.