TABLE OF CONTENTS

Page
TITLE PAGE.......................................................................................................... i
APPROVAL SHEET............................................................................................. ii
ACKNOWLEDGMENT........................................................................................ iii
TABLE OF CONTENTS....................................................................................... v
LIST OF TABLES.................................................................................................. ix
LIST OF FIGURES................................................................................................ xi
LIST OF SCHEDULES......................................................................................... xii
LIST OF APPENDICES........................................................................................ xiii
LIST OF EXHIBIT................................................................................................ xiv
LISTOF NOTES.................................................................................................. xv
SUMMARY OF THE PROJECT…………………..……………………........... xvi
Name of the firm......................................................................................... xvi
Location...................................................................................................... xvi
Brief Description of the Project.................................................................. xvii
Market Feasibility....................................................................................... xviii
Technical Feasibility................................................................................... xx
Management Feasibility.............................................................................. xxii
Financial Feasibility.................................................................................... xxiv
Socio-economic Feasibility......................................................................... xxiv

CHAPTER

I. BACKGROUND OF THE STUDY

Introduction.......................................................................................................... 1
Brief Background of the Study............................................................................ 3
Objectives of the Study........................................................................................ 5
Scope and Limitation of the Study..................................................................... 6
Definition of Terms............................................................................................. 9

II. MARKET STUDY

Objectives of the Study………………………………………….………........... 11
Methodology………………………………..………………………….............. 11
Research Design………………………………………………………….......... 12
Respondents of the Study…………………………………………………........ 12
Data Gathering Instrument……………………………………………….......... 12
Data Gathering Procedures……………………………………………….......... 13
Statistical Treatment of Data…………………………....................................... 14
Demand…………………….…………………………...................................... 15

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 Major Consumer of the Product.......................................................................... 16
Historical Demand................................................................................... 16
Projected Demand.................................................................................... 17
Supply.................................................................................................................. 17
Historical Supply....................................................................................... 17
Projected Supply........................................................................................ 18
Demand and Supply Analysis.............................................................................. 19
Market Gap.......................................................................................................... 19
Market Share....................................................................................................... 20
SWOT Analysis................................................................................................... 21
Strength.................................................................................................... 21
Weakness................................................................................................ 22
Opportunities........................................................................................... 22
Threats..................................................................................................... 23
Marketing Strategies and Program...................................................................... 23
Product..................................................................................................... 24
Product Size/Quantity/Category.............................................................. 24
Brand Name............................................................................................. 25
Packaging................................................................................................. 25
Pricing...................................................................................................... 26
Competitor’s Price................................................................................... 27
Channel of Distribution........................................................................... 27
Promotion................................................................................................ 28
Generalization...................................................................................................... 29

III. TECHNICAL STUDY

Objectives of the Study........................................................................................ 32
Product Description............................................................................................. 32
Nutrition Facts..................................................................................................... 33
Uses of the Product.............................................................................................. 34
Manufacturing Process........................................................................................ 34
Process Flow Chart.............................................................................................. 40
Time and Motion Study....................................................................................... 41
Production Schedule............................................................................................ 42
Factory Tools and Equipment.............................................................................. 42
Factory Furniture and Fixtures............................................................................ 44
Office Furniture and Fixtures.............................................................................. 45
Office Supplies.................................................................................................... 45
Office Equipments.............................................................................................. 47
Maintenance Expense.......................................................................................... 47
Direct Materials................................................................................................... 48
Indirect Materials................................................................................................. 49
Transportation Expense....................................................................................... 50
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 Delivery Expense................................................................................................ 51
Leasehold Improvement...................................................................................... 51
Utilities................................................................................................................ 52
Plant Location...................................................................................................... 52
Plant Size and Layout.......................................................................................... 53
Direct Labor Requirements ................................................................................. 54
Waste Disposal.................................................................................................... 55
Generalization...................................................................................................... 55

IV. MANAGEMENT STUDY

Objective Of The Study....................................................................................... 59
Forms Of Business Ownership............................................................................ 59
Capitalization....................................................................................................... 59
Organizational Structure...................................................................................... 60
Manpower Requirements......................................................................... 61
Job Specification...................................................................................... 61
Job Description........................................................................................ 63
Compensation.......................................................................................... 65
Organizational Policies………............................................................................ 67
Employee Policies…............................................................................... 68
Supplier Policies...................................................................................... 69
Legal Requirements............................................................................................. 70
Technical Requirements...................................................................................... 73
Generalization...................................................................................................... 75

V. FINANCIAL STUDY
Objective Of The Study....................................................................................... 77
Total Projected Cost............................................................................................ 78
Initial Capital Requirements................................................................................ 79
Financial Assumption.......................................................................................... 79
Financial Statement............................................................................................. 82
Statement Of Financial Peformance........................................................ 83
Statement Of Financial Position.............................................................. 85
Statement Of Changes In Partner`s Equity.............................................. 87
Statement Of Cash Flow Analysis........................................................... 89
Financial Analysis............................................................................................... 92
Financial Mix Ratios............................................................................................ 92
Liquidity Ratio......................................................................................... 92
Current Ratio........................................................................................... 92
Acid Test Ratio........................................................................................ 93
Working Capital................................................................................................... 94

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 Activity Ratio...................................................................................................... 94
Inventory Turnover............................................................................................... 94
Average Sales Period........................................................................................... 95
Debt Ratio............................................................................................................ 95
Equity Ratio......................................................................................................... 96
Debt To Equity Ratio........................................................................................... 97
Profitability Ratio................................................................................................ 98
Rate On Return In Equity.................................................................................... 98
Gross Profit Margin............................................................................................. 99
Net Profit Margin................................................................................................. 99
Rate Of Return On Assets.................................................................................... 100
Return On Sales................................................................................................... 100
Break-Even Point Analysis.................................................................................. 101
Break-Even Sales Volume And Break-Even Peso Sales..................................... 101
Margin Of Safety................................................................................................. 102
Margin Of Safety In Peso And Marginal Of Safety In Ratio.............................. 103
Average Annual Cash Flow................................................................................. 104
Payback Period.................................................................................................... 104
Generalization...................................................................................................... 105

VI. SOCIO-ECONOMIC CONTRIBUTION

Objectives Of The Study...................................................................................... 106
Contribution To Philippine Economy................................................................ 106
Employment Generation...................................................................................... 107
Social Desirability............................................................................................... 108
Environment........................................................................................................ 109
Generalization...................................................................................................... 109

BIBLIOGRAPHY
EXHIBITS
SCHEDULES
APPENDICES
NOTES

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 LIST OF TABLES

TABLE NO. TITLE

2.1 Historical Demand of Related Products

2.2 Projected Demand
2.3 Historical Supply
2.4 Projected Supply
2.5 Market Gap
2.6 Market Share
2.7 Price Scheme
2.8 Related Price of Competitors
3.1 Nutritional Facts of “Squid Patty”
3.2 Time and Motion Schedule
3.3 Production Schedule
3.4 Factory Tools
3.5 Factory Equipment
3.6 Factory Furniture and Fixtures
3.7 Office Furniture and Fixtures
3.8 Office Supplies
3.9 Office Equipment
3.10 Maintenance Expense
3.11 Direct Materials
3.12 Indirect Materials
3.13 Transportation Expense
3.14 Delivery Expense
3.15 Leasehold Rental
3.16 Utilities Expense
3.17 Direct Labor Requirements
4.1 Partner’s Contribution
4.2 Salaries Expense
4.3 Legal Permit, Licenses and Organization Chart
5.1 Total Projected Capital
5.2 Initial Capital Requirement
5.3 Current Ratio
5.4 Quick or Acid Test Ratio
5.5 Working Capital

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5.6 Inventory Turnover
5.7 Average Sales Period
5.8 Debt Ratio
5.9 Equity Ratio
5.10 Debt to Equity Ratio
5.11 Rate of Return on Equity
5.12 Gross Profit Margin
5.13 Net Profit Margin
5.14 Rate of Return on Asset
5.15 Rate of Return on Sales
5.16 Break-Even Volume Analysis
5.17 Break-Even Sales Analysis
5.18 Margin of Safety
5.19 Margin of Safety in Ratio
5.20 Annual Cash Flows
5.21 Payback Period

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 LIST OF FIGURES

FIGURE NO. TITLE

2.1 Brand Name Logo

2.2 Packaging
2.3 Distribution Management
3.1 Process Flow Chart
3.2 Plant Location
3.3 Plant Layout
4.1 Organizational Structure

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 LIST OF SCHEDULE

SCHEDULE NO. TITLE

1 Direct Material
2 Direct Materials Used
3 Direct labor per Unit
4 Annual Benefits of the Workers
5 Indirect Materials
6 Factory Machinery and Equipment
7 Factory Furniture and Fixtures
8 Factory Tools
9 Office Equipment
10 Office Furniture and Fixtures
11 Office Supplies
12 Maintenance Expense
13 Utilities Expense
14 Depreciation Expense
15 Leasehold Improvements
16 Tax and Licences
17 Rent Expense
18 Advertising Expense
19 Administrative Expense
20 Factory Overhead per Unit
21 Selling Price for Retailers
22 Projected Sales in Units
23 Fixed Cost
24 Variable Cost
25 Contribution Margin per Unit
26 Input VAT
27 Output VAT
28 Annual Cash Return
29 Contribution Margin
30 Delivery and Selling Expense
31 Inventories

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 LIST OF APPENDICES

APPENDIX TITLE

1 Articles of Partnership
2 Contract of Lease
3 Contract to Supply of Raw Materials
4 Survey Questionnaires
5 Questionnaire Results

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 LIST OF EXHIBITS

EXHIBIT NO. TITLE

1 Total Number of Household per Barangay

2 Computation for Average Annual Consumption
3 Historical Demand
4 Supporting Computation for Historical Supply
5 Projected Demand
6 Historical Supply
7 Supporting Computation for Projected Supply
8 Computation for Market Gap
9 Computation for Market Share

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 LIST OF NOTES

NOTE TITLE

1 Projected Sale in Peso

2 Cost of Goods Sold
3 VAT Payable
4 Ending Inventories

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 SUMMARY OF THE PROJECT

The summary of the project includes the name of the firm, brief description of the

project and highlights of major assumptions and summary of findings regarding market,

technical, management, and financial aspects. This feasibility study was conducted for

the potential of Hey, Dale Food Manufacturing Enterprise: Manufacturer of Tahong Patty

in Tanauan City, Batangas. The proponents tested if patty can be made by tahong as a

main ingredient instead of beef or pork where in the typical patty was made. The project

was proposed by Henryson R. Libang, Ruby Lea O. Llantero and Daryl B. Malubag

under Hey, Dale Food Manufacturing Enterprise.

Name of the Firm

The proponents agreed that Hey, Dale Food Manufacturing Enterprise as the

identity of their firm. The name came up from the names of each proponent. The

proponents also decided to operate under the form of partnership. This was because they

had limited capital and it is easy to operate under the form of partnership. Hey, Dale Food

Manufacturing Enterprise will be duly registered to different government agencies for the

legality of business operations.

Location

The proponent’s plant will be located at Barangay Gonzales, Tanauan City,

Batangas. The location was chosen because of its accessibility for the resources, not only

to the customers but also to the suppliers of the raw materials for the product. It is

convenient for production and distribution of the proposed product to the distributors to

the end consumers.

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 The researchers rented an establishment for Php 10,000.00 a month to operate a

business. The plant site covered a floor area of 70 square meters, good enough to

accommodate all the equipment, furniture and workers for the production. The plant was

divided in different sections such as: the production area, office, the storage of raw

materials and equipment, storage of finished goods, accommodation area or lobby, and a

comfort room.

Brief Description of the Project

Hey, Dale Food Manufacturing Enterprise, a partnership established by the three

proponents, will manufacture a product called Tahong patty. The product contains one

main ingredient which is mussel. The product was intended to meet the taste of the

market with the new variety of patty seafood flavor. Being new to the market made the

proponents to came up with a different promotion like free taste, personal selling,

quantity selling, food bazaar, product bundling and social media posting about the

product itself.

The proponents used descriptive type of research method in gathering all the

necessary data and information for this study. Questionnaires were distributed to 385

individuals and 30 business retailers related to the product within the nine (9) urban

barangays of Tanauan City to determine the historical and projected demand for the

product. Retailers and store owners were also interviewed to gather information about the

supply of related products.

Government agencies such as Securities and Exchange Commission, Department

of Trade and Industry, Department of Labor and Employment, Bureau of Internal

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Revenue, the City Permit and Licenses Division, the City Planning and Development

Office of Tanauan City were also consulted to make sure that all the legal requirements

needed in operating a manufacturing firm will be complied with.

Mussel, as a main ingredient of the proposed product, will be purchased from the

supplier in Cavite. The proponents also considered purchasing it from other places if it

will lead lower cost but not to sacrifice quality.

Partners agreed to contribute Php150,000.00 each, with a total of Php450,000.00

to support the established firm. Profits and loses will also be distributed in equally among

the partners.

Market Feasibility

The marketing study of this feasibility focused on the household and consumer

market of Tanauan City as its target market. The location was chosen because it is perfect

for new established firm for their offerings new-to-the-market product. It had a huge

volume of businesses, retailers and consumers who were the proposed target market of

the firm.

The target demand and supply were identified through product’s historical and

projected analysis from the information gathered by surveying numbered respondents.

The historical demand and supply of patty from 2014 to 2018 shows that it increases in

every year, which means that variety of patties had a high potential in the market.

Regarding the market gap, this section of study showed that there will be

increasing trend regarding the product within 5-year projection from 2021 to 2025. The

numerical analysis numbered the market gap each year from 1,716,198 in 2021,

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1,784,191 in year 2022, 1,852,185 in year 2023, 1,920,178 in year 2024 and 1,988,171 in

year 2025. The market share, which was the overall revenue contribution of the firm over

the market’s industry, from the next 5 year will 1.4% in 2021, 1.5% in 2022, 1.6% in

2023, 1.7% in 2024, 1.8% in 2025.

The SWOT analysis was also analyzed to determine the marketing strategy and to

handle the unexpected threats. The strengths of the product that can be a huge factor for

the business success were several product uses, strong financial condition, uniqueness of

the product, easy to cook, and cost advantage. The weaknesses that were given for the

firm to improved were limited business experience, limited number of suppliers, and

being prone to imitation. Opportunities for business growth was also discussed in this

section, these were being open to exploit new technology, open for forward vertical

integration, demand from population growth and introduction for additional product line.

As for the threats that the firm might face were presence of small scale, unexpected

climate change which was the main problem of the production of main ingredient, entry

of potent competitors and costly regulations.

To attract potential buyers of the product, the proponents used different kinds of

strategy and promotional activities that depends on the data gathered. 4 P’s commonly

known as Product, Price, Place and Promotion is used. It is essential to know if the

business has a potential to grow in each factors to generate an income and become

successful. The proponents chose Tahong Patty because of its uniqueness in terms of

variety which give it a potential to the market.

In terms of promotion of the product, the proponents considered free taste

strategy, personal selling, quantity selling, food bazaar, product bundling and online

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advertising through social media. For introductory stage, it is chosen to use online

advertising (social media) by making brochures online and posting on personal accounts

of the proponents and joining food bazaars. For the long term promotion and

advertisement, personal selling will be planned to use for continuous exposure of the

product to the market. To attract mass consumers and retailers, quantity selling, product

bundling and free taste strategy were considered as one of the promotional activities It is

important to keep the product known to market that it is existing. Furthermore, social

media page will be created for informing the mass market about its benefits.

Technical Feasibility

Tahong Patty is a new variety flavor of patty with mussel’s meat as its main

ingredient far more than the traditional beef and pork meat. Served in 6pcs of Tahong

Patty in 228g. per pack which sealed in round shaped canister. It plays a role of being

viand rather than being a burger patty as everyone commonly known. It is also an

alternative substitute for pork and beef patties as it was cost friendly product with a

quality.

In process of production, proper step by step process was well identified.

Manufacturing process includes preparation of equipment and ingredients, soaking of

mussels for removing its own dirt, chopping of secondary ingredients, steaming of

mussels, separating mussel’s meat from its shells, grinding the main ingredient, mixing

all the ingredients, molding of mixture, packaging, weighing, storing, cleaning the

production area and soaking TVP overnight. The business determined the effective

operating processes in order to know how to minimize their cost and increase the value of

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production. There should be a well-organized and systematic process to attain these

measures.

Production schedule of employees was discussed in this chapter. The daily

production schedule was set from 8:00 in the morning to 5:00 in the afternoon with 1

hour break each batch. The regular operation is eight (8) hours a day, five (5) days a

week and 20 days a week with the total of 240 days within a year. The firm projected to

produce 100 packs daily in first year operation. Adds 10 packs per year in the first 3 years

and 15 packs for the remaining years of 5-year projection to sustain the increasing

demand of the market.

This section also identified all the materials needed for the production and

operation of the business. Factory tools includes meat grinder, LPG tank, weighing scale

and stock pot set. Knife, chopping board, frying fan, freezer, and generator for equipment

to be used in production of the proposed product. For furniture and fixtures of both

factory and office includes store table and office table, chairs, office chairs, wall clock,

supplies and raw materials cabinet, and filling cabinet. All the materials listed on the

tables were identified through wide range canvassing of the proponents to lessen the

material cost of the firm.

The chosen plant location was agreed by the proponents, considering the best spot

for establishing a manufacturing business. By the help of City Planning and Development

Office Zoning Division in Tanauan Municipal, the proponents came up with the of

chosing Brgy. Gonzales in Tanauan to be the plant location. It suited the establishment of

the plantation because it was accessible to the resources and also to consumers and

xxi
suppliers of raw materials. The convenience for production and distribution of the

proposed product was considered. The plant size covered a floor area of 70 square meters

to accommodate the equipment, furniture, workers for production and employee for

business transactions. The layout of the site was simple with a common division for

production area, accommodation area or lobby, storage of raw materials and equipment,

storage room for finished goods and comfort room.

The firm went through proper selection of people for it has a huge effect in the

business in terms of managerial functions, efficient utilization, and motivation inside the

organization, better human relations and higher productivity. The management hired 2

workers and a bookkeeper with a fixed monthly salary of Php 7,460.00 and Php3,000.00,

respectively. The proponents decided to start with a capital of P450,000.00, which is

P150,000 each.

The proponents acquired information about the pricing in order to determine the

accurate number of raw materials and equipment need. For proper sanitation of the

business, maintenance equipment had included. These aspects are the foundation for the

successful operation of the proposed business

Management Feasibility

The management study explained the details about the business structure and the

overall strategic planning of the company. The proposed business is classified as a

partnership form of business ownership. The proponents agreed to contribute money to a

common fund to establish this business with an agreed capitalization Php450,000.00, the

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Php450,000.00 will be divided and contributed equally by the partners amounting to

Php150,000.00.

Having organizational structure in the company can help people inside the

organization to determine their roles and responsibilities. The proposed business will

have the partners that are in charge in decision making, one (1) manager to lead the

workers using performance management, two (2) workers in charge in production and a

bookkeeper who are in charge on keeping records of the financial affairs of the business.

Seeking for the necessary skills and ability of the employee is an important factor

for a higher level of productivity and efficiency of the employee. The proposed business

needs to hire a manager to lead employees using a performance management and

development process, two (2) skilled workers to perform the production and a

bookkeeper to run the business.

Everyone wants to receive the right and just wage according to the kind of work

they perform, that is why, compensation and all of possible benefits they can get is

necessary to determine by the company in order to motivate the workers to do their job

the best that they can. Rules and regulation of the company must be discussed in order for

the employees to be informed by what are do’s and don’ts activities in the workplace.

The permits, licenses, and other legal requirements were also determined in order

for the business to operate legally and have its legal identity. The firm must comply for

all the requirements in order to protect and maintain the operation of the company.

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Financial Feasibility

Since all projects are considered viable only when they are expected to meet short

term obligations, the financial aspect is a very important part of every project feasibility

study. Although the financial study requires a preparation of a number of financial

statements and analysis of several benchmarks in the form of ratios, the entire study

practically boils down to a question of profitability. Therefore, the proponents formulated

major assumptions that will serve as their foundation for estimating expenditures,

expenses and revenues of the projects.

The proponents total projected cost of Php 450,000.00 will cover the first two

months of the operation of the business. Careful consideration of the several factors that

affect the present and future financial position, performance and cash flows of the

enterprise must be studied. Hey, Dale Food Manufacturing Enterprise Statement of

Financial Performance revealed that it will earn a net income of Php234,894.62 in 2021

and will increase up to Php504,996.46 in 2025 with payback period 1 year, 11 months

and 17 days.

Socio-Economic Contribution

This study was formed with the mutual ideas from the proponents, which is to

introduce a new taste of patty in the market. Breaking the limited choices among

traditional existing patties in the market and opening a newly wide competition in the

industry, drove in mind of the researchers to come up with this ideas. Having concern in

the health of the workers and of people in the community, orderliness and cleanliness of

the environment and providing additional revenues are the best consideration in

xxiv
establishing a business. The proposed business will bring different opportunities not just

to the partners but also to the whole economy of the country.

The partner showed that the firm is not just concerned in profit but also on their

responsibilities in the society. The firm will contribute by creating jobs for unemployed

Tanauañeos and paying taxes that help the government in improving the lives of the

people through their project. Concerning the environmental issue, the company will

follow the rules and regulation of the proper waste disposal and the no plastic policy of

the City of Tanauan. The goal of the firm is not only to satisfy the customers but also to

meet the environment and economic expectations.

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