Tapawarma

EXECUTIVE SUMMARY

Tapawarma is a budget friendly business that serve most flavorful Pinoy Tapa on the go
meaning fast service in four or more different ways include rice, wrap, nachos, noodles,
milkshake, longwich, pamilya bundle, burger and mega solo with cost effective price
Which are highly recommended for everyone’s who would like to eat that satistified your craving while
you hungry or based on your wants. It will be located at Brgy. 4 Mabini St.Lipa City Batangas. It will be
composed of three employees, including the owner, front liner/ cashier and the barista/waiter. The shop
will be operating monday to saturday from 9:30AM – 6:30 PM. Primarily, Tapawarma will be produce
different Tapawaramas products like noodles, wrap, nachos and milktea and so on. Tapawarma primary
target market are students,workers, professionals that who had crave in Lipa, Batangas who are in the
age bracket of 20 to 29 years old. This is based from the norm and practices in the community that these
ages are the ones with enough purchasing capability to buy such product. The business will also target
to offer theirservices to organizations like Local GovernmentUnits (LGUs), schools and others. This will
help in maximizing economies of scale and promotion of satisfied food to the youth, who will soon be
the country’s workforce and leaders.After analyzing the demand and supply of tapawarma products
historically offered inthe Municipality of Lipa , it was found out that there is too.much market gap,
hence, an opportunity to Tapawarma. Tapawarma price starts at Php 49 with a Nachos, Wrap, Noodles
and Longwich that designed volumeof sales of 150 order daily or 54,750 order annually with the total
amount of Php 2,682,250 for the year 2021. The total project cost for establishing Tapawarma
amounted to Php 350,000 for its first month of operation. More so, the employeesand personnel of
Tapawarma will also enjoy benefits like employees of other businesses, plus a maximum of 10
percentIncrease in salary every year, depending on performance. The business will also comply with all
the regulatory requirements set by different government agencies, thereby contributing to the overall
economy in the locale.In general, the projected first five years of operations of the business will be
profitable, with increasing sales and margins while coping up with inflation rates and other necessary
financial adjustments. The business is, consequently, financially viable, and economically

Chapter I BACKGROUNDOF THE STUDY

This chapter deals with the presentation of the background of the study.Specifically, this presents an
introduction, the overview of the business, objectives of thestudy and the scope and limitations.

Introduction

The plan for business venture may pose a lot of queries. So, when we were askedwith this question:
“What are the things to consider in planning for a business?” theproponents thought of the answers
circumspectly and deeply.There are a lot of things that need to be considered– the location where the
business will be put up, the population ofthat certain place, the economic status of the people, and
competitors if there are.

It is not easy to give birth to a business which is not common to the place and its people. To succeed, a
lot of activities are to be done –information dissemination, themarket, the viability of the business
location, the product itself,nutrition, the price,ambiance of the business, and many others to consider.

After a thorough consideration, the proponents have come up with a feasibility study on a new business
that is supposed to be unduplicated by any of the business existing in the municipality of Lipa.
Convinced that despite the newness of the planned business project, the proponents have decided to
bring into life that it is the Shawarma.

Shawarmaas a new business concept is a meat preparation where lamb, chicken,beef, veal or mixed
meats are placed on a spit and maybe grilled for as long as a day.Shaving is cut off the block of meat for
serving, and the remainder of the meat is keptheated on the rotating spit. It can be served in shaving on
a plate (generally with add-ons). Shawarma also refers to a sandwich or wrap made with shawarma
meat. It is eatenwith tomato and cucumber toppings. It is now a fast-food staple worldwide

The inspiration brought by the new concept of a business has them prodded theproponents to decide
on a fast-food business and name it as Tapawarma. It hasits main product, the Tapawarma dish and
added with side dishes and other food offerings.It is advantageous for every food business to offer a
variety of food items to the generalpublic since wide selections are at their satisfaction. Shawarma
which come in manydishes can be served with carbonated drinks like Coca Cola and Milk Tea Surely,
theprospective customers will love to dine in again

. To avert possible risks and sustain the business, thus, this feasibility study to testthe profitability of the
business.

Overview of the Business

Speaking of twist, one stall that gave a twist to Filipinos’ comfort food is the Tapawarma. Well, from the
name itself, it features tapa that is wrapped in a tortilla bread along with vegetables and other
ingredients. It’s like the well-loved shawarma, however, the meat used is tapa. As time goes by, the
store sells different products.
The proponents decided the Tapawarma branch that will be located at Brgy. Mabini, Lipa
City.Tapawarma will be composed of employees, including the owner, front liner/ cashier and the
barista/waiter. The shop will be operating monday to saturday from 9:30 AM – 6:30 PM. Primarily,
Tapawarma will be offering ice blended milk tea and other offers like pamilya bundle and mega solo.
Tapawarma will also offer delivery services of orders to different organizations such as schools and
different Local Government Units, either to their canteens or during events, maximizing economies of
scale while continuously promoting satisfied prouducts to more Batangueños, most especially the youth.

Vision and Mission:

To be the No.1 Tapa On-the-Go in the Philippines within 5 years and be known worldwide within 10
years.

Objectives of the Study

The general objective of the study is to determine whether the business idea of Tapawarma is feasible
and will be patronized by the target market. Specifically, the study has the following objectives:

1. To determine the viability of the business and its products in the market by scrutinizing the demand
and supply, identifying market share, and devising relevant marketing plans and strategies;

2. To establish the operational flow of the business, comprising of the materials, machineries and
equipment, and strategic location that will best fit for the business;

3. To present the structure of the organization, requirements in the management of the business, and
pertinent policies in the conduct of the business;

4. To examine the financial viability of the business; and,

5. To implement practices that will maximize the project’s socio economic contribution to the
community

Scope and Limitation of Study

This study focused on the general idea of Tapawarma as a budget friendly shawarma shop in Lipa,
Batangas primarily offering tapawarma that the own version of Shawarma. Since this business belongs
to the food industry, the data used for market analysis is the whole population of Lipa.The study aims to
prove the feasibility of establishing a locally-inspired Tapawarma that offers different kinds of
Tapawarma and other beverage like Milk Tea and product like French Fries along Mabini Street Brgy. 4,
Lipa City . Furthermore, it carefully analyzes the market, management, technical, financial and socio-
economic aspects that the business is up to. It examines the feasibility of the business considering
different factors such as the prevailing market condition, the demand and supply, the existing
competitor, the standard pricing systems of the industry, and the current purchasing power of the target
population.Due to limited time and resources,the proponents focusing at Lipa City for their target
market. The proponents decided to concentrate their study for their respondent to the Tapawarma
business at Brgy 4 for asking some confidential survey questionnaire. On this endeavor, the proponents
learned that Shawarma Shack is the only well-established shawarma business around the area located
at J.M. Kalaw Brgy. 5, Lipa City Batangas that caters products services like delivering and serving to the
target market and hence, the only major competitor considered in this study.

Chapter 2

This chapter deals with the presentation of the marketing plan of the proposed business.Specifically, this
presents the name of the business, the product/service description, target market, demand and supply
analysis, projected sales, marketing program/strategies and marketing/selling expenses.

Product Description
Our highly sellable products speaks so loud, when they see us, we don’t need to explain it anymore as
TAPA AND SHAWARMA in one.Provide the most flavorful TAPA on-the-go (meaning fast service) in five
or more different ways: rice, wrap, noodle, wrap, longwich and the newest is burger.Also, Tapawarma
added new beverage option, famous MILKTEA drinks to add more profit on your part and give our
customers more options to enjoy Tapawarma.

The proponents focusing only to lowest price products which is tapawarma beefrice, tapawarma nachos,
tapawarna noodles, tapawarma longwich amd tapawarma wrap that is the best deals and the price
starts at 49.

Historical Demand

Historical demand is the basis for many important small business decisions. You want to be sure you are
capturing this data correctly, so it can be properly analyzed. small business captures historical demand
data and refers to it when making decisions about the future.

Table 1

Historical Demand

Year Population (20-29) Lipa % of Demand Historical Demand

City

2018 33,125 100% 33,125

2019 34,999 175% 61,248

2020 35,122 220% 77,268

Table 1 illustrates the historical demand for ages from 20 to 29 years old which is in year 2018-2020 in
population in Lipa, Batangas.

Projected Demand

Table 2

Projected Demand

YEAR POPULATION % OF DEMAND DEMAND

2021 37,123 270% 100,232

2022 39,102 285% 111,401

2023 42,013 300% 126,039

Table 2 shows the projected demand of Tapawarma for the span of 4 years
from 2021 – 2023.

Historical Supply
The historical supply of a certain product is computed through identifying the supply
of its competitors for the past five years. In this study, the data are gathered from
business related to the milk tea product.

Table 3
Historical Supply
Year Population (20-29) Lipa % of Supply Historical Supply
City

2018 33,125 40% 13,250

2019 34,999 50% 17,599

2020 35,122 56% 20,722

Table 3 shows the historical supply within the three products related to the business. The related
products started supplying in Lipa Batangas in 2018

Projected Supply

Table 4

Projected Supply

YEAR POPULATION % OF SUPPLY SUPPLY

2021 37,123 70% 26,283

2022 39,102 70% 27,371

2023 42,013 70% 29,049

Table 4 shows the projected supply of tapawarma main product for the year 2021 – 2023

Demand and Supply Analysis

Relationship between demand and supply is very crucial in every feasibility study, as it will show if the
products and/or services that will beintroduced will be patronized by customers. “The relationship
between demand and supply underlie the forces behind the allocation of resources” (Hayes, n.d.).After
analyzing the demand and supply of Shawarma historically offered in the Municipality of Lipa , it was
found out that there is a big market gap, hence, an opportunity to Tapawarma.

Table 5

Market Gap Analysis for Tapawarma

YEAR Projected Demand Projected Supply Market Gap

2021 100,232 26,283 73,949

2022 111,401 27,371 84,030

2023 126,039 29,049 96,990

As shown in Table 5, there is an increasing demand which indicates a increasing number of prospective
consumers who have the willingness an capacity to buy tapawarma for the periods 2021 - 2023. The
increasing trend indemand can be attributed from the increase in the population of Lipa, Batangas and
other near towns. The table also shows an increasing supply which signifies an improvement in the
production capacity of competitors within the same industry.

Projected Sales

After contemplating the demand and supply situation in the market, the company must consider also its
existing capacity in establishing its projected sales.Presented in Table 6 is the projected sales of
Tapawarma in year 2021.

Table 6 Projected Sales

Year In volume In pesos

2021 54,750 2,682,250

2022 60,225 2,951,025

2023 67,248 3,295, 152

SWOT Analysis

SWOT analysis (Strengths, Weaknesses, Opportunities and Threats) is a framework for identifying and
analyzing the internal and external factors that can be have an impact on the viability of project,
product, place and person. SWOT analysis is most commonly used by business entities, but is also used
by nonprofit organizations and, to a lesser degree, individuals for personal assessment Additionally, it
can be used to asses initiatives, products or projects (Rouse,2017).

Strengths

Product.Tapawarma products like Tapawarma nachos and tapawarna wrap are instgrammable. It offers
mega solo and family bundle

Price. Tapawarma has a competitive price against its competitors which is relatively cheaper compared
to other players on the market.

Place. Tapawarma presence is competitive where it will established its name not just physically thru its
office but also virtually thru active marketing campaign in social media and online marketplace.

Promotion. Tapawarma has fb boosting page to reach more customers.

Weaknesses

Product. New entrants with same offered products is the Tapawarma one of their weaknesses.

Price.Due to pandemic, inflation is the biggest problem that might change the price structure.

Place. Physical store is not too much crowded by many people.

Promotion. Other competitor has the same product and offers also in fb to well known

Opportunities

Product. Tapawarma offers a continuous and new innovation of products.

Place. Many people will come in and buy the products because it is near to the landing and picking of
transportation route.

Price. Competitive pricing will greatly get more customers and be popular in the target market place.

Promotion.Continue a make campaign in social media platform

Threats.

Product. Since it can deliver the products, the bad thing is Tapawarma afraid to deliver not well
presentable to the customer.

Place. New businesses who thought in establishing business with same but offer led produvts.
Price. Competitors dealing also in competive pricing.

Promotion. Tapawarma are not aware what the others competitors promote. And the social media that
they used has more advantage to them.

Marketing Strategies/Program

Businesses have high regard for quality and pricing as competitive advantage. The service improvement
strategies of the business involved in the study seemed to favor the customers. Similarly, competitive
advantage has been defined as “something that the firm does better than its competitors that give it an
edge in serving customers’ needs and/or maintaining mutually satisfying relationships with important
stakeholders (Ferrell, 2012)

Tapawarma is a food chain restaurant the Tapa-on-the-go! The all-time favorite Beef Tapa meals are
now made more enjoyable in delicious variations from shawarma wraps, rice, nachos and even to
noodles. Your favorite snacks and meals just got to a whole new level a tap away with Tapawarma. The
unique and innovative menu ideas of Tapawarma that will satisfy everyone’s tapa cravings, anytime,
anywhere and on-the-go.

Product

Product refers to the goods or services offered by a company. A productshould

meet a certain consumer demand, or it should be so compelling thatconsumers
believe they need it. To be successful, marketers should understandthe life cycle of
a product, and business executives should have a plan fordealing with products at
every stage of their life cycle. The type of product alsopartially dictates how much
businesses can charge for it, where they shouldplace it, and how they should
promote it (Goodman 2004).
Tapawarma an Filipino version of Shawarma offers affordable price that satistified the customers.
Wrap,Noodles, Nachos and Rice are the main products that have the best deals and starts with P49.The
origin of ingredients would present its quality and branding which ensure to stand out from other
competing product.

Figure 1 Tapawarma Products

Figure 2. Tapawarma Logo

Branding

The brand logo and at the same time the brand name itself is Tapawarma. Tbrand “TAPAWARMA ”
speaks so loud, when they see it don’t need to explain it snymore as TAPA AND SHAWARMA in ONE.
Price

Price is the amount of money consumers would pay for a product. Pricingthe products or services is
often tricky and required some markets research at first, as the pricing affect the sales. Marketers must
link the price to the real andperceived value of the product, but they also must take into account
supplycosts,seasonal discounts, and prices used by competitors. In some cases, businessexecutives may
manipulate a price to make a product seem more like a luxury, or they may lower a price so that more
consumers can try the product. Moreover,price margin is one of the important factors for business. With
the high-profit margin, there is no pressure to sell a big load of the products or services. In other words,
if the company profit margin is low, it will need to sell a large number ofproducts or services to keep up
the benefit. Pricing may be critical to find thebalance between the customer expectations and operating
costs in the marketingprocess (Chaston 2009, 162-181). Since there are only few direct competitors
formilk tea shop in Lipa, Batangas, the pricing strategy will be adopted from the national market and
what customers are willing to pay for tapawarma.

Table 7

Selling Price of lowest Price Product

Manufacturing Cost Price

Direct Materials 17.54

Direct labor 10.14

Overhead 1.49

Total 29.17

Markup (50%) 43.75

Input Vat(12%) Tapawarma

5.25

Suggested Selling Price 49.00

Table 8

Related Competitors Price at their lowest product price

Shawarma Shack 80.00

Turks 40.00

Wrap Brothers Shawarma 59.00

Place and Channel Distribution

Place/Channel of DistributionPlace refers to where the product is sold and how it is delivered to the
market. The marketers tend to place their products in front of the consumers whoare most likely to buy
them. Due to this fact, it is important to define the correctchannel of distribution in order to avoid the
waste resources. In some cases, thismay refer to placing a product in certain stores, but it also refers to
the placement of the product on a store's display or where a product is showcased on a web page
(Uusyritys 2017.). Tapawarma shop marketing concept is selling product direct to customers; therefore,
the distribution channel would be a physical shop.The location of the shop is in a busy place that can
attract the potential buyers like Lipa Batangas. Besides, for the trendy e-commerce, the Tapawarma
shop would also perform online to engage with the online customers.
 Figure 3

Channel Distribution

Promotions

Promotion is the communication field of the entire marketing function, it includes advertising, public
relations, and promotional strategy. A good promotion can boost company’s recognition and sales, thus
it usually ties into theother three Ps of the marketing mix, as promoting a product show consumer why
they need it and why they should be willing to pay a certain price for it. In addition, marketers tend to
tie promotion and placement elements together, so they can reach their core audiences. (Acutt 2015.)
Consumers
This section for a Tapawarma business would focus on the word of mouth, advertising on social media,
events and special offers. Tapawarma will also implement promos on its commencement day, inorder to
have a good kick-start of the business. Through such, the business’introduction to the public will be
most effective as customers will be curious to its product offering in the market. This will be coupled
with the promos to the pioneer clients in patronizing the products. In relation to the preceding section,
promotional activities are always accompanied by pertinent expenses.

24

CHAPTER 3TECHNICAL STUDY

INTRODUCTION

This chapter includes the product’s physical and technical features and its production

process wherein the product can be produced at a high quality within a reasonable cost. Ideally,the
product would be produced at the highest level of production possible incurring the least
costpermissible. In this part, the equipment and facilities, stall location, raw materials and
supplies,manufacturing process, waste disposal and labor requirements specifying the various
technicalities of those mentioned such as material requirements and equipment capacity are well-
documented.

PRODUCT DESCRIPTION

Shawarma is a delicacy wherein thinly sliced cuts of meat like chicken, beef, lamb andsometimes turkey,
are rolled into a piece of flatbread or pita that has been steamed or heated.Aside from the pieces of
meat, various kinds of foods are added such as hummus, tahini, picklesand vegetables are added.
Shawarma is the Middle East’s rendition of Turkey’s kebab and theGreek’s gyros.

Operational Process

Both products and services will be offered by Shawarma. In the beginning of the process, is from the
interaction of the waiter with the every customer whoenters the shop. It will basically start with
courtesy to the customers, followed by collection of information of the customer’s orders and/or
concerns. In terms of interactions at the physical shop, the flow of the operationalprocess is detailed as
follows:

1. As customers enter the shop, waiters greet them with a warm welcome;

2. As the customers approach the bar counter, the waiter at that front-line gets the customers’ orders;

3. (omitted)………………..

PRODUCTION PROCESS

•Each recipe will yield 6 sandwiches.

A.

Main Ingredients:

•2 lbs. beef or chicken meat, sliced very thin

•½cup plain grated cheese

•2 teaspoons sugar

• 1 tablespoon Miracle Whip

•4 cloves garlic, minced

•½ teaspoon soy sauce

•1 teaspoon white onions, finely minced

•½ teaspoon pepper
•½ teaspoon salt

•6pcs. Pita Bread

• ½ tomato, thinly sliced

•1 leaf of lettuce

B.

Procedures:

•Combine plain grated cheese, sugar, miracle whip, garlic, soy sauce, whiteonions, pepper and salt in a
food processor.

•Transfer to a separate dish, cover and refrigerate for at least one hour for bestflavor.

•Add meat and marinate overnight.

•Grill the meat until done.

•Combine the tahini, garlic, lemon juice, and parsley.

•Whisk well.

•Add water if needed.

•To make the sandwich reheat the marinated meat, slice open a pita and add a fewpieces of meat
followed by sauce.

•Serve when ready.

Operational Process

Both products and services will be offered by Tapawarma. In the beginning of the process, is from the
interaction of the waiter with the every customer whoenters the shop. It will basically start with
courtesy to the customers, followed by collection of information of the customer’s orders and/or
concerns. In terms of interactions at the physical shop, the flow of the operationalprocess is detailed as
follows:1. As customers enter the shop, waiters greet them with a warm welcome;

2. As the customers approach the bar counter, the waiter at that front-line gets the customers’ orders;3.
(omitted)………………..

Production Schedule
Tapawarma production will depend on the actual orders of the customers who dine or order the
products. Nevertheless, a conservative schedule was made based on the maximum production capacity
of the restaurant that will compensate days of over-orders, 10 minutes every day which considered idle
time.

Actual time of production will also depend on the head of the kitchen and barista preparing for the
ingredients of milk tea.

Table 8.

Production Schedule

Year Daily Monthly Anually

2021 150 4,563 54,750

2022 160 4,867 58,400

2023 170 5,171 62,050

LABOR REQUIREMENTS

The employees to be hired must be experienced in dealing with customers and should haveexperience
being in the hospitality industry. The following qualifications are necessary:

•Positive attitude and commitment to customer satisfaction

•Previous experience in cooking or serving

•Basic cooking skills

•Ability to work in a fast-paced environment

•Capable of using food preparation equipment

With both employees serving the same function, it ensures the unhindered production of theproduct
regardless of unavailability of either of them. The acquisition, proper preservation ndinventory of
ingredients and supplies will also be handled by them. Furthermore, the generalmanager/managing
partner must also be able to act as an accountant of the business

Machinery/Equipment Requirements

Any restaurant will not operate effectively and efficiently, servingdelectable drinks to customers,
without the use of equipment and machineries utilized in cooking or preparing beverages.
 Table 9

Machinery and Equipment

Description Quantity Unit Cost Total Cost

Shawarma 1 12,000 12,000

Machine

Deep Fryer 1 3,100 3,100

Digital Kitchen 1 2,050 2,050

Deep Freezer 1 3,000 3,000

Air-conditioner 1 9,000 9,000

Thermo Bucket 1 1,500 1,500

Ice Crusher 2 1,150 2,300

Electric Shaker 1 8,000 8,000

Machine

Total 40,950

Machineries and equipment are estimated to have a useful life ranging from 5 to 15 years while the
factory furniture and fixtures are estimated to have a useful life of 10 years. The firm will use straight
line method of depreciation. The following furniture will be also needed for the working area of the
proposed business.

Table 10

Furniture and Fixtures

Description Quantity Unit Cost Total Cost

Chairs 8 400 3,200

Tables 4 1,500 6,000

Total 9,200

Tool and Supplies

Tools and supplies will also be acquired to be used in the production.These are essential for the
operation to assure the quality of the product.

Table 11
 Tools and Supplies

Description Quantity Unit Cost Total Cost

Shawarma knife 2 60 120

Kitchen Scissors 1 100 100

Pan 2 300 600

Spoon 2 60 120

Wrap 2 70 140

Cup 2 100 200

Hand Gloves 3 100 300

Hairnet 3 15 45

Apron 3 60 180

Strainer 1 150 150

Total 1,955

Maintenance Supplies

The following are maintenance supplies used to observe cleanliness and orderliness for proper
maintenance and sanitation of the production area. The following supplies shown will be acquired to
have a proper and organized interior ambiance for a convenient working area.

Table 12

Maintenance Supplies

Description Quantity Unit Cost Total Cost

Broom 1 60 60

Dipper 1 20 20

Doormat 1 30 30

Dust Pan 1 40 40

Dust Bin 1 125 125

Dishwashing liquid 12 30 360
(200ml)

Mop 1 150 150

Pail 1 50 50

Rags 10 10 100

Scotch brite 5 20 100

sponge

Total 1,045

Utilities

Utilities are important in every business. Without this, the business will notfunction well. Utilities such as
electricity, water, telephone and LPG are needed for the operation and production process of the
business. Enumerated in Table 17 are the utilities needed by the Tapawarma.

Table 13

Utilities

Description Companys Name Annula

Consumption

Electricitu Batelec 13,500

Water Water District 7,000

Telephone Globe 6,000

Lpg Petron 9,000

Total 35,500

Plant Location

Determining the place of the business is very a essential decision to anyenterprise. This may greatly
affect the profitability of the proposed busines including the plans for future expansions. This refers to
the place or location of thebusiness which must be taken into consideration as factor affecting its
success or failures.
Production Cost

The total production cost per year is based on the cost of producing per unit times the total goods
produced in one year which is 54,750 order. The amount is comprised of cost of the direct materials
used, cost of direct labor and the total factory overhead incurred.

Table 14

Production Cost

Cost per unit Total Annual Cost

Direct materials 17.54 960,315

used

Direct labor 10.14 555,165

Factory overhead 1.49 81,577.50

Total Production 29.17 1,597,057.50
Cost

The production cost per unit is the total amount incurred in producing a single product. It is composed
of the amount of direct materials used, direct laborand the factory overhead per unit.

WASTE DISPOSAL

With the advent of eco-friendly policies being implemented at MSU-IIT, proper wastedisposal became
even more significant. The waste materials from the production of the productwill be disposed of and
segregated properly. Due to the ban or minimization on the usage ofsingle-use plastics, our product will
mainly use packaging made of durable paper.

LABOR COST

2 Production Personnel (Both trained to produce and serve shawarma) PHP 5,000

LABOR REQUIREMENTS

The employees to be hired must be experienced in dealing with customers and should haveexperience
being in the hospitality industry. The following qualifications are necessary:

•Positive attitude and commitment to customer satisfaction

•Previous experience in cooking or serving

•Basic cooking skills

•Ability to work in a fast-paced environment

•Capable of using food preparation equipment

With both employees serving the same function, it ensures the unhindered production of theproduct
regardless of unavailability of either of them. The acquisition, proper preservation ndinventory of
ingredients and supplies will also be handled by them. Furthermore, the generalmanager/managing
partner must also be able to act as an accountant of the business.

Chapter IV ORGANIZATIONAL PLAN

This chapter will present Tapawarma legal form of business pursuant to the existing laws of the
Republic of the Philippines, its organizational structure and pertinent functions and roles of each
member of the organization, accompanying office equipment for the successful delivery of each
member’s functions, the timeline of planned activities, and the associated administrative expenses
thereto.

Legal Form of Business

Tapawarma will be a franchise type of business, as prevalent in various start-up small enterprises. More
so, the business will be ran by the franchisee which will be the owner, through his small number of
workforce, using his own capital and personally acquired loans.

In establishing a franchise business, FrapperTea will have to comply with the following regulatory
requirements:

Table 15

Legal fees and Licences

Permit Cost

Brgy Clearance 850

Community Tax Certificate 1,300

DTI 600

Mayors Permit 5,000

Sanitary Permit 1,000

Occupational Fee 380

Occupational Police and Health Clearance 920

CGL Insurance 1,100

Sign Board Permit Fee 400

BIR fee 650

Franchise fee 170,000

Bookkeeping fee 1,000

Total 183,250

Capitalization

The owner’s personal fund and some of it will be borrowed to his parents with the total amount of Php
400,000 to finance the needed initial operations of the proposed business.

Owner / General Manager

Organizational Structure

The organization structure shows the relationship and segregation of duties of each employee in the
business. It permits the expressed allocation of duties and responsibilities for Worker
different2/functions and
barista/ waiter
processes of various entities
Worker 1/ Cashier

Tapawarma organizational structure is very basic, since it will only becomprised of three employees,
including the owner of the shop, and two personnel.

Figure 5.
 Tapawarma Organizational Chart

Manpower Requirements

The manpower requirement will identify the systematic way of determining the types of personnel
needed in the long and short range operation for anorganization. The importance of company
manpower is best understood by looking at its benefits in depth. Good manpower is needed for the
business to operate effectively to attain its objectives.

As for the case of FrapperTea, owner is part of the actual team who will dothe production of the food
products of the shop. The owner of the business willbe the one to do the nitty-gritty of establishing the
business through capital infusionand legal works, his employees will also be the one doing the
operations, including assistance in future documentary compliance needed for the business.

As shown in the organizational chart, FrapperTea’s initial manpowerrequirements will include the
owner, team leader/cashier and multitasking barista/waiter. The qualifications, duties and
responsibilities of these personnel are as follows:

1. Team Leader / Cashier/ Front Liner

Qualifications

 Has strong leadership skills;

 Has critical thinking and problem-solving skills;

 Has good written and communication skills;

 Has pleasing personality;

 Is customer-friendly;

Duties and Responsibilities

 Will be in-charged of overseeing and managing the overall

operations of the shop

Table 16

Tapawarma Compensation Scheme

Position Basic pay Benefits (SSS) Benefits Benefits Total Month

 (Philhealth) (Pagibig) Salary

Cashier 11,000 800 200 125 12,125

Barista/Waiter 11,000 800 200 125 12,125

Owner/GM 22,000 1,600 400 250 24,250

Total 44,000 3,200 800 500 48,500

Office Equipment

Since FrapperTea will not only operate through the production of food products that it offers, and will
be entertaining customers at the physical shop,the following are the initial list of necessary office
equipment, furniture, and fixturesfor FrapperTea’s operations for the first year:

Table 17

List of Office Equipment

Description Quantity Unit Cost Total Cost

Air Conditioner 1 9000 9000

Total 9000

Table 18

Furniture and Fixtures

Description Quantity Unit Cost Total Cost

Chair 8 400 3200

Tables 4 1500 6000

Total 9200

Administrative Expenses
Expenses incurred in relation to the totality of the organization, those which are not directly related to
the process of producing or manufacturing the productsand/or services, and selling the same, are called
administrative expenses (Investopedia, n.d.). Examples of which are salaries of employees, office
supplies expenses, repairs and maintenance expenses, taxes and licenses fees, the previously discussed
utilities expenses, indirect expenses, and depreciation expense. Table 19 shows the summary of
Tapawarma's administrative expenses for the 1st year of its operations.

Table 19

Administrative Expenses

Administrative Expenses 1 Year

Salaries-Office Workers 582,000

Supies Expense -Office 1,955

Repair and Maintenance Expense- Office 1,045

Taxes and License Fees 12,250

Utilities Expense-Office 35,500

Rent Expense- Office 204,000

Depreciation Expense- Office 700

Total 837,450

Chapter V

FINANCIAL PLANS

A very essential part of the business plan is the financial aspect. This is one of the factors in determining
the success of the business and provides assurance that resources are available for the project. This also
determines if the proposedbusiness is financially feasible.

Total Project Cost

The assumption of project cost is one of the important things to consider in making a business project.
The total project cost is the amount of money needed to make business plan feasible. The cost must be
reasonable and need not to be too expensive or too large to say that the project will be a success.
Proper allocation of resources and execution will always be the key to a successful business.

Table 20

Projected cost for one month

Description Amount

Fixed Assets

Machineriea and Equipment Php 40,950

Furniture and Fixtures 9,200

Php 50,150

Working Capital for one

Month

Tools and Supplies 3000

Utilities 2958

Rent Expense 17,000

Salaries Expense 48,500

71,458

Pre operating expenses

Legal fees and Licenses 183,250

Advertisement Expenses 12,000

195,250

Revolving Cash 33,142

Total project cost 350,000

The total project cost for establishing Tapawarma amounted toPhp350,000 for the first month of the
business.

List of Assumptions

The following assumptions were used by the proponents in the computation and analysis of the financial
capacity and stability of the firm;

1. Inflation rate

Different prices, costs and expenses would increase based on the average inflation rate of 5% based on
the five years inflation rate from 2018- 2020.

2. Capital Requirements

The business plan has a cash contribution of P 350,000 from the owner.

3. Working days

There will be eight (8) working hours a day, six (6) working days in a week, and an average of 345 days in
a year.

4. Accounting Reporting Period

A calendar year of business was implemented starting January 2021

5. Production Capacity

The business can produce a 54,750 of tapawarma main product on the first year.

6. Purchases

The volume of purchases (direct and indirect materials) would

increase proportionately with the increase in the quantity produced.

7. Sales

a. The initial selling price for the main products of tapawarma forr customers is Php 49. Increase in the
selling price is brought by many factors such asinflation rate increase.

8. Inventory
a.There will be no work-in process inventory.

b. Finished goods ending inventory is totaled five percent of the annual

production.

9. Expenses

a. All expenses are paid in cash at the time of incurrence except for

electricity, water since it has its scheduled date of payment.

10.Labor and Employee Benefits

a. Labor cost will increase annually based on the sum of inflation rate and

increase in production.

b. There will be three workers in production.

11.Utilities

Utilities Expense will increase five percent annually based on inflatio

rate.

12.Maintenance Expenses

a. Maintenance Expense will increase 5% annually based on inflation rate

13.Property, Plant and Equipment

a. Acquisition of equipment, furniture and fixtures is on cash basis.

a.No additional machinery would be purchased for the first three years ofoperation.

b. The firm will use the straight line method of depreciation.

c. All property, plant and equipment will have 5-10 years of useful life.

14.Leasehold Improvement

The firm will not be having major improvement on the plant location.Only minor development of the
location is needed and it will be expensed as incurred. It will be depreciated to three years.

15.Advertising Expense
Advertising expense from 2021-2023 will increase based on average inflation rate of five percent.

16.Owner’s equity

The owner is allowed to have withdrawal every year which will not exceed 40 percent of net income. .

17.Inflation Rate

a. Inflation rate as peg at an average rate of five percent per year

provided by the Philippine Statistics Authority.

Projcted Income Statement

2021 2022 2023

Sales 2,682,250 2,951,025 3,295,152

Less of Cost Sales 1,597,057.50

Gross income 1,085,199.50

Operating and Administrative Expenses

Taxes and Licenses 183,250

Advertisement Expenses 144,000

Bookkeeping fee 12,000

Total operating and Administrative 339,250

Expenses

Net income before tax 744,945.50

Less: income tas expense(20%) 148,981,10

Net income after tax 595, 964.40