URBAN TOTE BAGS

Entrepreneurial Development Project

Submitted to the Faculty of the
Department of Management Studies
Cavite State University
General Trias City, Cavite

In partial fulfillment of the

requirements for the degree
Bachelor of Science in Business Management

MA. JAY-ANN A. ANGUSTIA

MARY MARGARETTE I. DOMINGUEZ
MA. HAZEL P. FAGARA
JEFFRY M. FAUSTINO
DENCEL MAE S. GOZO
JOHN NATHANIEL P. NIETO
DECEMBER 2022
 Republic of the Philippines
CAVITE STATE UNIVERSITY
General Trias City, Campus
Barangay Vibora, General Trias City, Cavite

DEPARTMENT OF MANAGEMENT STUDIES

Authors: Ma. Jay-Ann A. Angustia

Mary Margarette I. Dominguez
Ma. Hazel P. Fagara
Jeffry M. Faustino
Dencel Mae S. Gozo
John Nathaniel P. Nieto

Title: Urban Tote Bags

APPROVED:

KAYCELYN MARJORIE O. GAMBON _______ APRIL G. GILE _______

Adviser Date Technical Critic Date

APRIL G. GILE _______ DR. NOEL MANARPIIS _______

Department Chairperson Date Research and Development Date
Coordinator

PROF. MARILOU P. LUSECO _______

Dean Date
 TABLE OF CONTENTS

Page
LIST OF TABLES ………………………………………………………………… v

LIST OF FIGURES………………………………………………………………... vii

LIST OF APPENDICES…………………………………………………………... viii

BIOGRAPHICAL DATA………………………………………………………….. ix

ACKNOWLEDGEMENT…………………………………………………………. xv

ABSTRACT………………………………………………………………………... xviii

INTRODUCTION………………………………………………………………….. 1

Nature of the Project……………………………………………………. 2

Objectives of the Project……………………………………………….. 3

Mission and Vision……………………………………………………… 3

Time and Place of the project………………………………………….. 4

DESCRIPTION OF THE ENTERPRISE………………………………………… 5

Layout of the Project………………………………………………….… 5

Form of Business……………………………………………………….. 6

Urban Tote Bags Logo…………………………………………………. 6

Organization and Management……………………………………….. 6

Timetable of the Activities……………………………………………… 9

Production……………………………………………………………….. 10

Procurement of Materials………………………………………………. 11

Production Process…………………………………………………….. 13

Monthly Purchases, Production, and Inventory……………………… 15

Inventory………………………………………………………………… 15

Production Summary…………………………………………………… 16

Sales Summary…………………………………………………………. 17

iii
 Marketing………………………………………………………………... 20

Product…………………………………………………………………... 23

Product Description…………………………………………………….. 23

Price……………………………………………………………………… 24

Promotion……………………………………………………………….. 24

Mode of Payment………………………………………………………. 25

Place……………………………………………………………………... 26

Finance………………………………………………………………….. 26

Financial Breakdown…………………………………………………… 27

FINANCIAL ANALYSIS………………………………………………………….. 28

Income Statement………………………………………………………. 28

Partner's Equity…………………………………………………………. 30

Statement of Financial Position……………………………………….. 31

Cash Flow Statement…………………………………………………... 32

FINANCIAL RATIOS……………………………………………………………... 33

Gross Profit Margin……………………………………………………... 33

Net Profit Margin………………………………………………………... 34

Return on Investment…………………………………………………... 34

Return on Asset…………………………………………………………. 35

PROBLEMS, SOLUTIONS AND INSIGHTS…………………………………… 36

Problems and Solutions………………………………………………... 36

Insights…………………………………………………………………... 38

SUMMARY AND CONCLUSION………………………………………………... 40

Summary………………………………………………………………… 40

Conclusion………………………………………………………………. 41

REFERENCES……………………………………………………………………. 42

APPENDICES……………………………………………………………………... 43

iv
 LIST OF TABLES

Table Page

1 Timetable of Activities…………………………………………….. 9

2.1 Direct Materials (Version 1)…………….………………………… 12

2.2 Direct Materials (Version 2)………….…………………………… 12

3 Direct Labor………………………………………………………... 13

4 Indirect Materials………………………………………………….. 13

5 Production Cost per Unit…………………………………….……. 14

6.1 Monthly Sales for Version 1 Tote Bag…………………..……….. 15

6.2 Monthly Sales for Version 1 Tote Bag………..………………….. 15

7 Monthly Inventory…………………………………………………. 16

8 Monthly Production Summary…………….……………………… 17

9.1.1 Sales Summary of Sold Products – Retail, Version 1…..……… 19

9.1.2 Sales Summary of Sold Products – Retail, Version 2………….. 19

9.2 Sales Summary of Sold Products – E-commerce…….………... 19

9.3 Sales Summary of Sold Products – Reseller…….……………... 20

10 Price Per Product……………………………………….…………. 24

11 Product Promotion and Advertisement Expenses……….…….. 25

12 Overall Financial Break Down……………………….…………… 27

13 Income Statement for the Period of July to December………… 29

14 Partner’s Equity……………………………………………………. 30

15 Statement of Financial Position………………..………………… 31

16 Statement of Cash Flow………………………………………….. 32

17 Summary of Financial Ratios of Urban Tote Bags……………… 33

v
 LIST OF FIGURES

Figures Page

1 Location of the Project………...………………………………….. 4

2 Layout of the Project………………………………………………. 5

3 Logo of the Urban Tote Bags…………………………………….. 6

4 Organization and Management of Urban Tote Bags…………… 8

5.1 Production of Urban Tote Bags from First Manufacturer………. 11

5.2 Production of Urban Tote Bags from Second Manufacturer…... 11

6 Production Process……………………………………………….. 14

7.1 Facebook Page of Urban Tote Bags…………………………….. 21

7.2 Instagram Account of Urban Tote Bags…………………………. 21

7.3 Tiktok Account of Urban Tote Bags……………………………… 22

7.4 Tiktok, Shopee and Lazada Listings…………………………….. 22

8 Product Features of Urban Tote Bags…………………………… 23

9 Payment Methods…………………………………………………. 26

vi
 LIST OF APPENDICES

Appendix Page

1 Product Logo………………………………………………….….. 44

2.1 Payment for Supplier…………………….…………………….… 45

2.2 Continuation………………………………………………………. 46

3 Sales Receipts……………………………………………….…... 47

4 The Entrepreneurs………………………………………….……. 48

5.1 Sample Product…………………………………………….……. 49

5.2 Continuation………………………………………………….…… 50

6 Social Media of Urban Tote Bags……………………….……… 51

7 E- Commerce Platforms of Urban Tote Bags………………… 52

8.1 Product Deliveries……………………………………………….. 53

8.2 Continuation………………………………………………………. 54

9 Production Documentation……………………………………… 55

10.1 Customers Feedback……………………………………………. 56

10.2 Continuation………………………………………………………. 57

10.3 Continuation………………………………………………………. 58

11 Certificate of Sponsorship……………………………………….. 59

12 DTI Registration………………………………………………….. 60

vii
 BIOGRAPHICAL DATA

Ma. Jay-ann A. Angustia was born on November 10, 1999, and her birthplace

is Quezon City. She resides at 0617 Purok Sinco Pasong Kawayan 1, General Trias

Cavite. Her parents are Mr. Jayshon L. Demetrio and Mrs. Annie A. Angustia; she is

their only child.

She completed her primary education in 2013 at Mayor Calixto D. Enriquez

Elementary School, located at Ligtong 1, Rosario, Cavite. She finished her secondary

education in 2017 at Governor Ferrer Memorial National Highschool in Brgy.

Pinagtipunan General Trias Cavite. She obtained her senior high school diploma in

2019 at Jose Rizal University, located at 80 Shaw Boulevard, Mandaluyong City.

She took up her Bachelor of Science in Business Management with a major in

Marketing at Cavite State University—General Trias Campus, located at Brgy. Vibora

General Trias Cavite and she graduated in 2023. She received an honorary degree

when she graduated from her secondary education. Also, she became a Dean's Lister

in three semesters in college.

viii
 BIOGRAPHICAL DATA

Mary Margarette I. Dominguez was born on December 17, 1999, in the City

of General Trias, Cavite. She is currently residing at 390 Brgy. Pinagtipunan, General

Trias City, Cavite. Out of two siblings, she is the third child of Mr. Harold Dominguez

and Mrs. Rowena Dominguez.

She finished her primary education at Luis Ferrer III Memorial School, Brgy.

Pinagtipunan, General Trias City, Cavite, in the year 2012, with honors and garnering

awards such as best in science, became the top 3 in her class. She is also awarded

the mayor's Excellence Award. For her secondary education, she went to Governor

Ferrer Memorial National High School, located at Barangay. Pinagtipunan, General

Trias City, Cavite, and graduated in 2016. Moreover, she completed her Senior High

School with honors at Luis Y. Ferrer Jr. Senior High School at Barangay. Pasong

Kawayan II, General Trias City, Cavite.

She took up her tertiary education with a BS Business Management Major in

Marketing degree at Cavite State University- General Trias City Campus, which is

currently located at Barangay. Vibora, General Trias City, Cavite. She was awarded

the dean's lister in her first year at university and became a consistent president's lister

in her second year up to the fourth year. She graduated with Latin Honors in the year

2023. She is also the Vice President of General Sports, an organization that promotes

and encourages Esports as a venue to foster growth.

ix
 BIOGRAPHICAL DATA

Ma. Hazel P. Fagara was born on March 2, 1988, and her birthplace is

Calatagan, Batangas. She was currently residing at Block 8 Lot 23 Natania Homes,

Brgy. Pasong Kawayan 2, General Trias, City Cavite. She is the second child of Mr.

Rogelio C. Fagara and Mrs. Crisanta P. Fagara.

She began her elementary education at Balibago Elementary School in Lian,

Batangas. She was one of her school's qualifiers in a regional science competition.

She ranked as the fifth placer in the Regional Science Quiz Bee competition during her

elementary years and graduated in 2000. She finished Secondary Education in 2004

at Balayan National High School in Balayan, Batangas.

She took up her tertiary education with a BS in Business Management,

majoring in Marketing Management at Cavite State University- General Trias City

Campus located at Barangay Vibora, City of General Trias, Cavite. She is a beneficiary

of Congressman Luis Jon-Jon A. Ferrer's student assistance program and a dean's

lister and academic scholar in her university and graduated in 2023.

x
 BIOGRAPHICAL DATA

Jeffry M. Faustino was born in Manila City on June 9, 2000. He resides in the

Grand Riverside subdivision, Pasong Camachille 1, General Trias City, Cavite. He is

the son of Mr. Mario C. Faustino and Mrs. Arlene M. Faustino and the first of two

siblings.

He finished his primary education in 2012 at Thomas Aquinas School in the

Grand Riverside subdivision, Pasong Camachille, 1 General Trias City, Cavite. And

secondary education in the year 2016 at Thomas Aquinas School in Grand Riverside

Subdivision, General Trias City, Cavite. He finished senior high school with Science,

Technology, Engineering, and Math in 2018 at Fiat Lux Academe in Grand Riverside

Subdivision, General Trias City, Cavite. He finished college with Bachelor of Science

in Business Management, major in Marketing, in the year 2023 at Cavite State

University General Trias Campus in Arnaldo, General Trias City, Cavite.

xi
 BIOGRAPHICAL DATA

Dencel Mae Gozo was born on August 31, 2000, and she’s currently residing

at 0483 F. Dulce Street, Barangay Pinagtipunan, City of General Trias, Cavite. She is

the only child of Mr. Prudencio Gozo and Mrs. Marcelina Saliba.

She graduated from primary education in 2013 at Luis Ferrer III Memorial

Elementary School in Barangay Pinagtipunan, City of General Trias, Cavite. She

graduated from secondary education in 2017 at the Governor Ferrer Memorial National

High School in Barangay Pinagtipunan, City of General Trias, Cavite. She graduated

from senior high school in 2019, and she took the science, technology, engineering,

and mathematics strand at Samuel Christian College located in Barangay Navarro,

City of General Trias, Cavite. Lastly, she graduated from tertiary education in 2023,

and she took a Bachelor of Science in Business Management Major in Marketing

Management at Cavite State University - General Trias Campus located in Barangay

Vibora, City of General Trias, Cavite.

xii
 BIOGRAPHICAL DATA

John Nathaniel P. Nieto was born on November 28, 2000, and his birthplace

is Tanza, Cavite. He was currently residing at Purok 5, Barangay Pasong Kawayan 1

City of General Trias, Cavite. He is the only child of Mr. Arnold M. Nieto and Ms. Elena

P. Nieto.

He began his primary education in Pasong Kawayan 1 Elementary School, now

Juliano C. Brosas Elementary School, located at Pasong Kawayan 1 City of General

Trias, Cavite. He played board games called SCI-DAMA and DAMATH, which had a

mathematical influence during his elementary years, and graduated in 2013. He

finished junior high school in 2017 at Governor Ferrer Memorial National High School

located at Barangay Pinagtipunan, City of General Trias, Cavite with honors and

became the top 16 of his batch. He also gained his first National Certificate III in Visual

Graphic Design during junior high school. He took the Accountancy, Business, and

Management strand in senior high school at Luis Y. Ferrer Junior-Senior High School

located at Pasong Kawayan 2 City of General Trias Cavite. He became the president

of the research club, coordinator of DRRMC, and coordinator of the Youth for

Environment in Schools Organization. In 2019 he also received his second National

Certificate in Bookkeeping. He graduated in 2019 with high honors and became the

top 3 of his batch. He also received a Gawad Mojica award from the Local City

Government of General Trias in 2019.

He took up his tertiary education with a BS in Business Management, major in

Marketing Management at Cavite State University- General Trias City Campus located

at Barangay Vibora, City of General Trias, Cavite. He was awarded as Dean’s Lister

in her first year at university and became a consistent President’s Lister in his second

year up to the fourth year. He graduated in 2023 with Latin honors. He is also the

Visual Editor of General Esports Organization, which promotes and encourages

esports as a venue to foster growth.

xiii
 ACKNOWLEDGEMENT

The author would like to acknowledge and gives the warmest thanks to the

people who made this project possible. This project will be unbearable without the

guidance and everlasting support of the people whose been with the author throughout

the bumpy road while trying to accomplish things all at once.

Ms. Kaycelyn Marjorie Gambon, the Entrepreneurial Development Project

adviser, for her extended discussions and valuable suggestions towards the brand.

Those suggestions have contributed significantly to the creation of product and paper

improvement. Her friendly recommendations and expert guidance have been

invaluable throughout all phases of the work.

Ms. Ellen A. Blanco, Entrepreneurial Development Project Financial

Consultant, for her valuable comments, suggestions, and time giving instructions to

make this project more accurate and understandable.

Mr. Christian B. Panganiban, Entrepreneurial Development Project Marketing

Consultant, for giving practical pedagogy and suggestions on marketing products.

Ms. April G. Gile, their technical critic, and department chairperson, for the

approval of the proposal on Urban Tote Bags and for her recommendations on how to

enhance the product.

Dr. Roncesvalle J. Caipang, their english critic, for her assistance and

constructive suggestions while checking this manuscript. Also, for her untiring support

and patience in editing and making time for this manuscript.

Dr. Noel B. Manarpiis, Research and Development Coordinator, for his

approval to do an entrepreneurial project.

xiv
 Prof. Marilou P. Luseco, Campus Administrator, for approving the title and

paper to proceed with the other steps to fulfill the entrepreneurial project.

Ms. Annie A. Angustia, the author's mother, for always supporting her in

everything, especially emotionally and financially.

Mr. Naurence Raychard R. Mateo, the author's partner, thank you for all the

support, especially mentally and emotionally. Without you, this project would be

nothing, as you supported us until its end.

Mrs. Rowena Dominguez, the author’s mother, who never fails to give advice

and encouragement throughout the process. For her continuous support and

understanding upon completion of this project and also her prayers which sustained

her this far.

Mr. Emerson Lucena, the author’s best friend and a long-time partner, for giving

her such motivation and never failing to cheer her up, especially during those hard

times. He is an incredible human being, and his support is deeply appreciated.

Mrs. Arlene M. Faustino, who helped him find his first customer and always

believed in him, not losing faith even though he failed many times.

Mr. Winston Mondares, who helped him sell 15 Urban Tote bags in their

workplace.

Mrs. Elena Nieto, the author's mother, is greatly appreciated and noted for her

never-ending encouragement when things get tough. It was a huge source of comfort

and relief for the author, as it became his drive and foundation in finishing the project.

Mrs. Janice Castro, author’s reseller, for the never-ending support towards the

brand. Thank you for trusting the product as your additional source of income.

Mr. Larence Brenches, Mr. Joshua Aragaon Lariosa, Mr. John Carlo Reyes,

and Mr. Warren Daniel Osinaga, authors' friends, thank you for spreading the ideas of

our bag. You guys became a massive channel in promoting and advertising our brand

and products. Without your help, the brand will not have its position today.

xv
 Mrs. Eva Bagting and Mrs. Alona Flores, the firm's tailors, thank you for

investing your time and effort in creating the products. Without your help, we couldn't

create stylish and affordable tote bags. Your knowledge and craftmanship became a

massive part of the business's success.

To the authors friends, Kyle, Bandar, Russell, and Kaila, who helped him

promote and sell Urban Tote Bag to their associates. To the authors friends and

relatives for showing support upon launching the project and acquiring their presented

products.

To the authors customers, thank you for having and supporting the business.

It is an immense happiness for the business whenever they give excellent feedback

about the business and the products.

Beyond all, the authors will keep trusting Almighty God, who gave her strength

and hope using His words and being Her Father in Heaven who gave guidance,

protection, love, and care for her even in the darkest times of her life, for hearing her

prayers and giving

THE AUTHORS

xvi
 ABSTRACT

ANGUSTIA, MA. JAY-ANN A., DOMINGUEZ MARY MARGARETTE I., FAGARA,

MA. HAZEL P., FAUSTINO, JEFFRY M., GOZO, DENCEL MAE S., NIETO, JOHN
NATHANIEL P. Entrepreneurial Development Project. Bachelor of Science in
Business Management major in Marketing Management. Cavite State University
General Trias City, Cavite. May 2022. Adviser: Ms. Kaycelyn Marjorie O. Gambon.

Urban Tote Bags has been established to adhere to the Entrepreneurial

Development Project of the entrepreneurs' final year in the Marketing Program. Urban

Tote Bags started its operations on the 3rd of July, ending on the 30th of November.

The business's primary purpose is to reach a certain amount of the market and be

profitable while providing unique and stylish tote bags and continuously innovating the

product for customer's needs and preferences. The tote bags are also made

accessible to anyone who wants them by establishing an online shop and using e-

commerce platforms to accommodate a wide range of customers. Also, the owners

are determined that by the end of the year 2023, Urban Tote Bags will be locally known

and will be able to establish physical stores within the City of General Trias and

eventually create new product lines.

With a starting capital amounting to fourteen thousand and five hundred

pesos (PHP 14,500.00) invested by the six entrepreneurs, they sold over six hundred

eighty bags by reinvesting the profits through the whole operations. The business

earned a net income of over ninety-two thousand and four hundred twenty-nine and

fifty centavos (PHP 92,429.50) by constantly trying to develop new marketing ideas

and strategies that would increase sales every month. The entrepreneurs'

determination is what brought this business this far. They are always bound to be

optimistic and address any issues that may arise during business conduct efficiently.

Doing business takes much work, as many competitors are rising daily. Regardless,

the company still strives for business growth and infuses the quality of it is company

culture to continuously provide a product that is not only profitable but can also give

back to the community.

xvii
 1

URBAN TOTE BAGS

Ma. Jay-Ann A. Angustia

Mary Margarette I. Dominguez
Ma. Hazel P. Fagara
Jeffry M. Faustino
Dencel Mae S. Gozo
John Nathaniel P. Nieto

An undergraduate enterprise development project submitted to the faculty of the

Department of Management Studies, Cavite State University, General Trias City,
Cavite in partial fulfillment of the requirements for the degree of Bachelor of Science
in Business Management Major in Marketing Management with contribution No.
___. Prepared under the supervision of Ms. Kaycelyn Marjorie O. Gambon.

INTRODUCTION

Urban Tote Bags is proudly created by a group of promising young

entrepreneurs, which embraces modern designs to fit the preference of both Gen Z

and adults who love using stylish yet space-saver types of bags. With a tagline of

"Totetally design for your style," it indeed incorporates a wide variety of designs to fit

your everyday style. The intention behind the creation of this product is to introduce

tote bags as fashionable while dependable and serve as an effortless carryall,

especially during those busy days. Moreover, the proponents of the business also

wanted to showcase the idea wherein the bag's exterior acted as a fashion item or

mode of self-expression to either make a statement or declare their preference that

suits their interests. As customers nowadays are into classy looking but can only spend

not that much money, our products are made to meet those expectations.

As Urban Tote Bags the start-up product for our newly established business,

we are constantly working on designs and styles so they can be desirable and fits the

need of the many here in the Philippines. We want to introduce the upgraded and

improved version of the quality and style of the regular tote bags that are being sold
 2

around with not much increase in their pricing. As tote bags are made to reduce plastic

bags, we intend for our bags to have multiple uses. But it's not just the practicality that

makes these our bags so attractive, either. For us, they are reliable items that can hold

your products while maintaining a fashionable and eco-friendly style. In other words, it

is also an innovative and effortless marketing tool to spread our brand. With the

addition of social media exposure and direct marketing, we will be able to establish

brand awareness of our product. Our long-term goal is to establish a quality

organization and for our product to build an excellent reputation and deliver a fantastic

experience to each customer.

Nature of the Project

Urban Tote Bags always believes that fashion bags should be inexpensive and

ought to be always accessible to those people who love matching bags with their outfits

but have not got the time to shop and buy one for themselves. In able to keep up with

fashion trends, this tote bag is modernly designed to fit the preference of both Gen Z

and adults who love using a stylist yet space-saver type of bag.

Aside from its superb features, its craftsmanship starts with cutting the fabric to

attain the desired size, followed by sewing its edges to shape the figure of the bag. It

is created from corduroy outer fabric with up-to-date and pleasing to the eye designs

and a water-repellent fabric on the inside. It is stitched together to ensure the quality

of each product. The tote bag is secured with a zipper lock to keep it closed and

maintain the safety of the belongings of its user.

Urban Tote Bags not only wants to earn profits from its products but prioritizes

providing a high-quality product at its best cost and satisfying the fashion tastes of the

masses. To do this, the owners spend much time researching and doing constant

product testing while infusing quality into the company culture. Moreover, the company

also gives back to the community by sponsoring events and webinars. This way, the

brand could engage with existing customers and extend its audience while creating a

positive reputation.
 3

Objectives of the Project

The company's primary goal is to reach a certain number of market and be a

profitable business while keeping the product prices as low as feasible.

Specifically, it aimed to:

1. Establish a fashionable and durable tote bags without compromising the

customer’s budget;

2. Promotes the use of reusable bags and reduction on the use of plastics;

3. Continuously innovate tote bags for customers’ needs and preferences through

building connections and collectively having their feedback and reviews about

the tote bags;

4. Provides unique and stylish tote bags to satisfy our customer's fashion tastes;

5. Be optimistic and address any issues that may arise during the conduct of the

business in an efficient and innovative way.

6. To be a profitable brand that also gives back to the community through joining

and sponsoring charitable events.

Mission

To provide quality and affordable tote bags for every generation that is durable,

eco-friendly, and sustainable in any lifestyle.

Vision

To be a locally known company that creates products that serve purposes in

everyday lives and commit to producing stylish and modern designs of tote bags. Also,

we aim to establish physical stores within the City of General Trias and eventually

create new product lines.

 4

Time and Place of the Project

The project was approved in the fourth week of April and started its

manufacturing and procurement process from May to June. The project was launched

on July 03, 2022, and operates from July to December. The project's location is Pasong

Kawayan 1 City of General Trias, Cavite. Depending on the orders, the shareholders

will assume that operating hours will be 8:00 am to 5:00 pm. Due to the pandemic, the

business does not have a physical store to visit by customers. However, it will be a

massive opportunity for the brand to boost its image on social media and e-commerce

platforms.

Figure 1. Location of the project

 5

DESCRIPTION OF THE ENTERPRISE

Layout of the project

The product has a minimal design that signifies modern style, and Urban Tote

Bags goes for this design as a signature style of the tote bags to fit every generation.

Urban tote bags are made from 100% corduroy fabric and pull fabric to make them

flexible and durable. The dimensions of the first designed tote bag are 15 by 13 inches,

and the second design is 16 by 14 inches. It is environmentally friendly as there are

no plastic materials used in these tote bags. Moreover, the tote bags come with high-

quality bag closing threads with the use of size number 5 zippers, making them more

durable and safer. Consequently, Urban Tote Bags offers a significant advantage over

other tote bags. The tote bags from the brand offer a water-repellant feature that is

perfect for rainy weather. The brand also offers modern style that are not yet offered

in the market

Figure 2. Layout of the project

 6

Form of Business

The Urban Tote Bags goes with the fashion and bag industry. The brand offers

a fashionable and a better version of the standard tote bag. Our company focuses on

making affordable, fashionable, and water-repellent tote bags. The company of Urban

Tote Bags operates as a partnership with six proprietors working together to run the

business.

Urban Tote Bags Logo

The word urban on the brand's logo means modern, with a match of minimal

design that signifies a trendy style. Moreover, the overall content and style of the logo

also depicts the product they offer, a minimalist tote bag that is modernly designed to

fit the preference of both Gen Z and adults who love using a stylist yet space-saver

bag.

Figure 3. Logo of Urban Tote Bags

Organization Management

The organization believes that for project completion to be successful, different

fields of work should be assigned to specific people who can fulfill their duties and

handle their tasks with ease. This will lead to the maximization of the company's

productivity and foster business growth.

The entrepreneurs will be responsible for all the overall processes upon doing

the project. From planning, handling finances, production, and customer service, they

should be at the forefront for the organization to work towards its goals. This also
 7

involves allocating enough resources, delegating responsibilities, and setting realistic

timelines and standards for completion.

Being the Overall Manager of the organization, John Nathaniel Nieto handles

the overall decision-making and administering policies and rules of the business. He

will also have the final say in everything the team comes up with, such as marketing

strategies and modifications to the production.

Mary Margarette Dominguez will be responsible for handling finances,

tracking cash flows, and making financial reports concerning operating costs and

revenues. She will also incorporate controlling costs and monitoring sales daily.

Ma. Hazel Fagara heads the distribution of products and procurement of raw

materials. She will also ensure that the right products are delivered to the correct

location on time and at a reasonable cost.

This also involves coordinating and monitoring logistics operations such as inventory,

transportation, and supply chain processes.

Dencel Mae Gozo leads the manufacturing process by ensuring that the

production and the finished product are high quality and meet the company's

standards. She will be typically responsible for hiring contractors or the sewers,

managing the workflow for a production project, and ensuring efficiency during the

process.

Lastly, Ma. Jay Ann Angustia and Jeffry Faustino leads the sales and

marketing. They should be responsible for the promotional process of the products and

deal with customers' feedback and complaints. They should also monitor market

trends, create advertising campaigns, and develop pricing strategies and targeting

strategies based on demographic data to reach more customers and provide superior

customer service.
 8

THE TEAM

Figure 4. Organization and management of Urban Tote Bags

Timetable of the Activities

The business's timetable shows its various stages starting from the beginning.

It indicates the weekly operating schedule that the company adheres to and follows.

For the month of June, it reveals all of the pre-operating activities of the business, such

as planning, canvassing, selection of tailors, procurement of raw materials, creating

social media, joining e-commerce platforms, handling raw materials, and collection of

finished products. From the month of July to December, it entails all of the

implementation and control of the business, such as launching, photoshoot, listing of

products, selling, and deliveries of the product. The business also had its first restock

in August followed by the month October. Moreover, in September, the business

started collaborating with influencers for a more robust marketing campaign. October

is the month when the business has its second manufacturer and its second wave of

restocking. In November, the business launched its second design and each month

had its inventory control and monitoring.

Table 1. Timetable of Activities
9
 10

Production

The enterprise adopted three production strategies that are essential to provide

the demand for the products, fulfill the business objectives, and for the business to run

effectively and efficiently. The first strategy that the business use at the first beginning

is the make-to-order production strategy. This strategy allows the enterprise to collect

orders and adds them to the planned production. The second strategy that the

enterprise did was the chase production strategy. In this method, the business matches

the demand set forth by the market. The production is scheduled based on orders,

reducing the probability of having unsold products. Lastly, as the enterprise has more

confidence in the product, there is a trend with tote bags and upcoming special events.

The firm is now taking the make-to-stock production strategy, which ensures the

business' stocks remain flexible to adjust to market demands. Whenever there are

resellers and orders, the company can supply and meet the demand of orders.

In constructing the tote bags, Urban Tote Bags starts with contacting the

chosen supplier, procuring all needed materials, and handling it with the contracted

tailor. Within the tailor shop, cutting the cloth to the desired size and stitching the edges

together to form the bag's shape are the first steps in its construction. It is made of a

water-repellent fabric on the inside and a corduroy fabric on the outside with modern,

aesthetically pleasant motifs. To ensure the quality of each product, it is hemmed

together. A zipper lock keeps the Urban tote bag closed and ensures the security of

the contents inside for the user. After that, the proponents collect the finished products

and put them in packaging, making them ready for deliveries and orders.
 11

Figure 5.1. Production of Urban Tote Bags from First Manufacturer

Figure 5.2. Production of Urban Tote Bags from Second Manufacturer

Procurement of Materials
The procurement process of the materials for the production of the tote bags

has different steps. First, we identified the raw materials and components that will be

used to produce the tote bags. Next, we made a purchase requisition that contained
 12

the item descriptions, quantity, and price of the materials. Then, we assessed and

selected suppliers present in an online store that could give quality and reliable

materials. We ordered sample fabrics and materials from them to ensure that we would

have significant quality inputs for our tote bags. After making the purchase, we

monitored the shipment of all the items and coordinated with the seller to make sure

the materials arrived on the date before the production schedule.

Table 2.1. Direct Materials (Version 1)

DIRECT MATERIALS UNIT QUANTITY PRICE COST
Corduroy Fabric yards 1/2 ₱35 ₱35

Polyurethane Laminate Fabric yards 1/2 ₱20 ₱20

Logo piece 1 ₱5 ₱5

Slider piece 1 ₱5 ₱5

Zipper piece 1 ₱5 ₱5

TOTAL ₱ 70.00

This table shows all the materials we use to produce the tote bags. It shows

the materials we needed and the cost of each tote bag that the firm produces for

version 1.

Table 2.2. Direct Materials (Version 2)

DIRECT MATERIALS UNIT QUANTITY PRICE COST
Corduroy Fabric yards 1/2 ₱35.00 ₱35.00

Polyurethane Laminate Fabric yards 1/2 ₱20.00 ₱20.00

Logo piece 1 ₱5.00 ₱5.00

Slider piece 1 ₱5.00 ₱5.00

Zipper piece 1 ₱5.00 ₱5.00

Ring Holder piece 1 ₱5.00 ₱5.00

TOTAL ₱ 75.00
This table shows all the materials we use to produce the tote bags. It shows

the materials we needed and the cost of each tote bag that the firm produces for

version 2.
 13

Table 3. Direct Labor

DIRECT LABOR QUANTITY PRICE
Version 1 1 ₱65.00

Version 2 1 ₱80.00
This table shows the cost of labor for the version 1 and version 2 of the tote

bags.

Table 4. Indirect Materials

INDIRECT MATERIALS UNIT QUANTITY PRICE COST
Craft Paper piece 1 ₱2.50 ₱2.50

Printing Cost piece 1 ₱2.50 ₱2.50

TOTAL ₱ 5.00

This table shows the indirect materials of the business use and the cost of

making each tote bag.

Production Process

The process consists of seven steps for the tote bag to be ready, and each bag

should be thoroughly inspected to ensure its quality. The process of a tote bag can be

broken down into the following seven steps: The first step is the procurement of raw

materials. The team canvas all of the needed materials and selected quality materials

that will be used in making the tote bag. The second step is handling the procured raw

materials for the manufacturer. After collecting raw materials, the team will hand them

to manufacturers and tailors. They will be the ones to build and create the tote bags.

After the agreed timeframe with manufacturers, the team will collect of finished product

from the manufacturers, which is the third step. For the fourth step, the team will do

quality control of each bag to ensure every thread and fabric meet the standard. After

ensuring the quality of the manufacturer’s work, the fifth step will be for the team puts

the logo in the tote bag. After the products have been well made, the team will prepare

the tote bag for packaging. The craft paper will be printed with the brand logo and

stapled in the folded tote bag. For the last step, the team will organize the product

orders and prepare for shipment, or for direct selling, it will be delivered personally.
 14

Figure 6. Production Process

Table 5. Production Cost per Unit

VERSION 1 OF TOTE BAG
PRODUCT COST OF PRODUCTION COST PER UNIT

800 Tote Bags ₱112,000.00 ₱140.00

VERSION 2 OF TOTE BAG

PRODUCT COST OF PRODUCTION COST PER UNIT

200 Tote Bags ₱32,000.00 ₱160.00

This table show the overall production of the business and the cost per unit of

tote bags for the version 1 and version 2. The business produced six hundred fifty tote

bags for its version 1 with a cost of one hundred forty pesos each (PHP 140.00) and

one hundred tote bags for the version 2 with a cost per unit of one hundred sixty pesos

each (PHP 160.00).

 15

Monthly Sales, Production and Inventory

Table 6.1. Monthly Sales for Version 1 Tote Bag

MONTH QUANTITY SOLD COST OF GOOD SOLD
July 93 bags ₱13,020.00

August 110 bags ₱15,400.00

September 145 bags ₱23,300.00

October 188 bags ₱26,320.00

November 85 bags ₱11,900.00

December 148 bags ₱20,720.00

This table shows all the product sales of version 1 tote bags from the first five

months of the Urban Tote Bag’s operation. The business starts selling products from

July 2022 up to December 2022.

Table 6.2. Monthly Sales for Version 2 Tote Bag

MONTH QUANTITY SOLD COST OF GOOD SOLD
November 65 bags ₱10,400.00

December 119 bags ₱ 19,040.00

This table shows all the product sales of version 2 tote bags from the month

of November and December.

Inventory

The table shows that the Urban Tote Bag began its inventory in July, and since

then, they have begun to sell and acquire from its tailors 100 tote bags, sold 77 tote

bags, and has an ending inventory of 7 bags. The following month, August, Urban Tote

Bags produced 250 tote bags and sold 110 products. At the end of the month, the

firm's ending inventory goes with 147 tote bags. The entrepreneurs did not make any

tote bags for September. However, they sold 105 tote bags without any inventory left.

In the following month, October, the entrepreneurs acquired 200 tote bags from their

manufacturers, sold 195 tote bags, and still have 5 tote bags on hand. In November,

entrepreneurs created 100 version 1 of their tote bags and 100 new tote bag designs.

They sold 85 version 1 designs and 65 for the new design, with an ending inventory of
 16

20 version 1 tote bags and 35 new tote bag designs. In December, the business

manufactured a total of 150 version 1 of tote bags and 100 version 2 tote bags. As the

month ends, they sold 148 pieces of version 1 tote bags and 119 pieces of version 2

tote bags. Moreover, they had an ending inventory of 22 pieces for version 1 tote bag

and 16 pieces for version 2.

Production Summary

Table 7. Monthly Inventory

ENDING ENDING
MONTH VERSION 1 VERSION 2 BALANCE BALANCE
V.1 V.2
July 100 bags - 7 bags -

August 250 bags - 147 bags -

September 0 bags - 0 bags -

October 200 bags - 5 bags -

November 100 bags 100 bags 20 bags 35 bags

December 150 bags 100 bags 22 bags 16 bags

As the Urban Tote Bags business progressed, the owners agreed to do a soft

launch as soon as possible. It is because they want to reach many more customers to

have more time to sell their products. After long hours of finishing the final design for

the bags, they proceeded to canvass raw materials with the best cost and quality they

wanted. In the first week of July, the owners spent their time procuring raw materials,

selecting tailors to do their standard bags, and distributing them precisely in the allotted

time. The production of tote bags started in the second week and third week of July.

Different colors of tote bags are being made with the same layout.

Moreover, by the end of July, the business produced 70 bags. The following

month, August, the owners agreed to produce 250 tote bags due to demand in the

market. They have decided to mass produce and find another tailor in the first week of

August so that it would reach the number of bags they want to produce. However, in

September, the owners refrained from producing tote bags since there was still a lot
 17

left in the inventory. Shortly after, they acquired about 200 bags in October since there

was an increase in demand from customers since they started having resellers and

already established an online shop. In November, the owners created another version

of the tote bag. They think it will be best for the business to have additional designs to

result in a higher income. They have agreed to produce 100 bags for the old and new

versions. As the month December came, the business produced 150 version 1 tote

bags and 100 version 2 tote bags.

Table 8. Monthly Production Summary

MONTH VERSION 1 VERSION 2
July 100 bags -

August 250 bags -

September 0 bag -

October 200 bags -

November 100 bags 100 bags

December 150 bags 100 bags

This table shows the overall tote bag production from July to December of the

version 1 and version 2 of tote bags.

Sales Summary

Urban Tote bags have always been active in marketing its products on different

platforms. Even before the soft launch, the owners wanted to create energy to

captivate their potential customers. The bags had a selling price of two hundred forty-

nine (PHP 249.00), So it is not surprising that their stocks were almost sold out in the

first month of their July sales. Out of one hundred bags, the owners sold ninety-three

bags, earning the business twenty-two thousand nine hundred nine pesos and eighty

centavos (PHP 22,909.80). In the following month, the owners decided to add more

stocks to keep up with the customers' demand. They expected their sales to be high-

rocketed since they were bound to sell as much as possible to get a higher income.

Their efforts paid off because they sold one hundred ten bags in August, which earned

the business a total of twenty-seven thousand and thirty-four pesos (PHP 27,034.00).
 18

However, in September, there was still an increase in sales even though the firm still

needed to produce bags that month. Surprisingly, the owners sold about one hundred

forty-seven bags with a total amount of thirty-five thousand and one hundred fifty-one

pesos and fifty centavos (PHP 35,151.50). After that, the owners are still determined

to increase their sales which leads to them having resellers. In October, as expected,

the sales were much higher than the previous month. They have sold about one

hundred eighty - eight bags, earning the business forty-four thousand and eight

hundred sixty-three pesos and five centavos (PHP 44,863.05). In the last month of

their sales, upon introducing a new design of the tote bags, which had a selling price

of two hundred seventy-nine pesos (PHP 279.00), the owners sold about sixty-five of

the latest versions, which has a total cost of eighteen thousand and one hundred thirty-

five pesos (PHP 18,135.00). While on the old version, the sales are still high regardless

of the fewer bags produced that month. The owners sold eighty-five bags, earning the

business a total of twenty thousand and seventy-four pesos and sixty-five centavos

(PHP 20,074.65). In the following month, not surprisingly due to the Christmas season,

the owners sold over one hundred forty-eight bags of the old version of the tote bag,

which earned the business thirty-four thousand and three hundred fifty-nine pesos and

eight-five centavos (PHP 34,359.85) and one hundred nineteen bags on the new

version which adds up an income of thirty-three thousand and two hundred one peso

(PHP 33,201.00).
 19

Table 9.1.1. Sales Summary of Sold Products – Retail, Version 1

MONTH QUANTITY SELLING PRICE MONTHLY TOTAL
July 77 bags ₱249.00 ₱19,173.00

August 87 bags ₱249.00 ₱21,663.00

September 105 bags ₱249.00 ₱26,145.00

October 127 bags ₱249.00 ₱31,623.00

November 47 bags ₱249.00 ₱11,703.00

December 77 bags ₱ 249.00 ₱19,173.00

TOTAL 520 bags ₱129,480.00

This table shows all the retail sales of version 1 tote bags from its first day of

release up to December 2022.

Table 9.1.2. Sales Summary of Sold Products – Retail, Version 2

MONTH QUANTITY SELLING PRICE MONTHLY TOTAL
November 65 bags ₱279.00 ₱18,135.00

December 119 bags ₱279.00 ₱33,201.00

TOTAL 184 bags ₱51,336.00

This table shows all the retail sales of version 2 tote bags from their release in

the month of December 2022.

Table 9.2. Sales Summary of Sold Products – E-commerce

SELLING MONTHLY
MONTH QUANTITY DEDUCTION FREEBIE
PRICE TOTAL
July 16 bags ₱249 ₱12.45 ₱3.00 ₱3,736.80

August 23 bags ₱249 ₱12.45 ₱3.00 ₱5,371.65

September 30 bags ₱249 ₱12.45 ₱3.00 ₱7,006.50

October 31 bags ₱249 ₱12.45 ₱3.00 ₱7,240.05

November 23 bags ₱249 ₱12.45 ₱3.00 ₱5,371.65

December 27 bags ₱249 ₱12.45 ₱3.00 ₱6,386.85

TOTAL 150 bags ₱35,113.50

 20

This table shows all the sales from e-commerce of version 1 tote bags from

its first day of release up to December 2022.

Table 9.3. Sales Summary of Sold Products - Reseller

MONTHLY
MONTH QUANTITY SELLING PRICE
TOTAL
July 0 bags ₱200 ₱0.00

August 0 bags ₱200 ₱0.00

September 10 bags ₱200 ₱2,000.00

October 30 bags ₱200 ₱6,000.00

November 15 bags ₱200 ₱3,000.00

December 44 bags ₱200 ₱8,800.00

TOTAL 99 bags ₱19,800.00

This table shows all the sales from resellers of version 1 tote bags from its

first day of release up to December 2022.

Marketing

E-commerce and social media are expanding quickly, and more entrepreneurs

now utilize this chance to expand their businesses online. The Urban Tote bag uses

social media to sell its products as a start-up. This makes it simple for consumers to

connect with the brand identity and learn more about the product. Urban tote bags

regularly post on Facebook, Instagram, and even TikTok to draw customers' attention

and inform them about the product. Moreover, Urban Tote Bags also list their product

on Shopee, Lazada, and TikTok, enabling more extensive market reach.

 21

Figure 7.1. Facebook Page of Urban Tote Bags

Figure 7.2. Instagram Account of Urban Tote Bags

 22

Figure 7.3. TikTok Account of Urban Tote Bags

Figure 7.4. TikTok, Shopee and Lazada Listing

The business provides social media platforms for more incredible and better

market reach. It allows them to showcase the products to people who use social media.

Moreover, the business also lists its product on E-commerce platforms such as TikTok

shop, Shopee, and Lazada Store.

 23

Product

The Urban Tote Bag promotes expressing an individual's personality in their

style. Urban Tote Bag offers a corduroy tote bag with minimal designs and different

colors. The tote bag has two pockets outside and three pockets inside, and it have pull

fabric for a double lining which is water repellant for its unique feature. Also, for

securing the bag opening urban tote bag used a zipper for a more secured bag.

Figure 8. Product Features of Urban Tote Bags

Product Description

Nowadays, tote bags are a product that satisfies customers' fashion

preferences or fashion styles. Every generation that appreciates fashionable, space-

saving bag designs can benefit from carrying urban totes. 100% corduroy and pull
 24

fabric create flexible and long-lasting Urban tote bags. Since these tote bags do not

include any plastic, they are environmentally friendly. Moreover, the tote bags come

with high-quality bag closing threads and size five zippers, making them more durable

and safer. The brand's tote bags have a water-repellent characteristic that makes them

ideal for rainy days. The intention behind the creation of this product is to introduce

tote bags as fashionable yet dependable and to serve as an effortless carryall,

especially during those busy days. They also wanted to showcase that the bag's

exterior acted as a fashion item or mode of self-expression to either make a statement

or declare their preference that suits their interests. This product was designed to

introduce tote bags as a flexible carryall that is stylish and dependable, especially on

hectic days. Additionally, we wanted to demonstrate how the bag outside might be

used as a piece of fashion or a means of self-expression by the owner to make an

impact or show off a preference that fits their interests.

Price

The Urban Tote Bags version 1 design sells for two hundred forty-nine pesos

(PHP 249.00) and version two sells for two hundred seventy-nine pesos (PHP 279.00).

Table 10. Price Per Product

VERSION 1 VERSION 2
Variable Price Per Product ₱140.00 ₱160.00

Retail Price ₱249.00 ₱279.00

Promotions

Because it is more convenient for the customers, the Urban Tote bag

advertises the goods on various social media platforms, including Facebook,

Instagram, and TikTok. To promote the product and attract buyers, they post it every

day. In order to establish credibility and win over clients, they also post customer

reviews. Additionally, they offer freebies like coin purses and pens
 25

Table 11. Product Promotion and Advertisement Expenses

PROMOTIONS UNIT QUANTITY UNIT COST AMOUNT
Pen piece 150 ₱3.00 ₱450.00

Shopee Ads php 1 ₱1,000.00 ₱1,000.00

PR Box piece 6 ₱20.00 ₱120.00

PR Bag piece 5 ₱140.00 ₱700.00

Vouchers piece 20 ₱50.00 ₱1,000.00

Giveaway Bag piece 4 ₱140.00 ₱560.00

TOTAL ₱3,830.00

Mode of Payments

Urban Tote Bag offers payment through direct selling, which handles payment

personally. Also, Urban Tote Bags offers a cash-on-delivery method for delivery orders

for the convenience of distant customers. Moreover, customers can also have their

orders through e-commerce platforms such as TikTok, Shopee, and Lazada, as these

platforms offer a wide range of different wallet options and cash on delivery methods.

The brand also offers Gcash as a payment method, as its target markets widely use it.

Lastly, it offers Online banking for payment because some customers prefer to use it

for faster and hassle-free transactions.

 26

Figure 9. Payment Methods

Place

The Urban Tote Location is Pasong Kawayan 1 City of General Trias, Cavite.

It is available on E-commerce like Shopee and Lazada. Also, it is available in Tiktok

shop and can be purchased on Urban Tote Bag Facebook and Instagram Pages.

Finance

The entrepreneurs started the operation in July 2022. The overall breakdown

of expenses is ₱151,590.00.00 it includes the labor and materials, shipping cost and

other production in the first 6 months as a starting business. The table shows the total

of overall breakdown of expenses.

 27

Financial Break Down

Table 12. Overall Financial Breakdown

EXPENSES VERSION 1 VERSION 2 AMOUNT
Direct Materials ₱56,000.00 ₱15,000.00 ₱71,000.00

Indirect Materials ₱4,000.00 ₱1,000.00 ₱5,000.00

Labor Cost ₱52,000.00 ₱16,000.00 ₱68,000.00

Shipping Cost ₱2,200.00 ₱440.00 ₱2,640.00

Advertising and Promotion ₱5,830.00 ₱0.00 ₱3,830.00

TOTAL ₱150,470.00
The overall breakdown of expenses, which includes all expenses involved

during the production, was ₱150,470.00. The overall cost of the materials, which

comprise direct materials, was ₱71,000.00 while the cost of indirect materials was

₱5,000.00. The entire cost of the labor was ₱68,000.00. The entire cost of the

shipment, which is the cost of shipping the products from the tailor to the entrepreneurs

was ₱2,640.00. The entrepreneurs spent a total of ₱3,830.00 on advertising and

promotion.
 28

FINANCIAL ANALYSIS

The financial analysis evaluates businesses, projects, budgets, and other

finance-related transactions to determine their performance and suitability. Typically,

financial analysis is used to analyze whether an entity is stable, solvent, liquid, or

profitable enough to warrant a monetary investment. Financial statements such as the

Balance Sheet, Income Statement, Cash Flow Statement, and Owner's Equity were

used to examine the company's economic performance.

Financial Statement

The table below summarizes how the firm used the funds from shareholders

and its current financial position. The company has three primary financial statements.

First is the Balance Sheet, which shows the firm's assets, liabilities, and net worth on

a stated date. It displays the business's financial status; the second is the Income

Statement (also called profit & loss account), which shows how the firm's net income

is arrived at over a stated period. The last one is the Cash Flow Statement, which

shows the inflows and outflows of cash caused by the firm's activities during a stated

period. These three statements are informative tools that can be used to analyze a

company's financial strength and provide a quick picture of a company's financial

health and underlying value.

Income Statement

The following data shows the income statement of Urban Tote bags. It enlisted

the detailed pieces of product sold every month and the cost of it, which shows the

gross profit. Also, it includes the expenses every month while the company is

operating. Lastly, this shows the Net profit for the last six (6) months of operation.
 29

Table 13. Income Statement for the Period of July to December

URBAN TOTE BAGS
INCOME STATEMENT
For the Period of July to December 3, 2022
(In Pesos)
Particulars Quantity Cost per Unit Amount

Sales: Version 1 769 249.00 191,481.00

Version 2 184 279.00 51,336.00
Less: Cost of Goods Sold V.1
Direct Material 769 70 53,830.00
Direct Labor 769 65 49,985.00
Indirect Labor 769 5 3,845.00
Less: Cost of Goods Sold V.2
Direct Material 184 75 13,800.00
Direct Labor 184 80 14,720.00
Indirect Labor 184 5 920
Gross Profit 105,717.00

Less: Expense
Shipping Cost 12 220.00 2640.00
Transaction Fee 150 12.45 1867.50
Freebie 150 3.00 450.00
Advertisement 1 1000.00 1000.00
Discount from Reseller 99 50.00 4950.00
Product Review Bag 5 140.00 700.00
Giveaway Bag 4 140.00 560.00
Box 6 20.00 120.00
Vouchers 20 50 1000.00
Total Expenses 13,287.50

Total Operating Income 92,429.50

NET PROFIT 92,429.50

Table 14. Partner’s Equity
30
 31

Statement of Financial Position

Table 15. Statement of Financial Position as of December

URBAN TOTE BAGS
BALANCE SHEET
As of December 31,2022
(In Pesos)
ASSETS

Cash 112,848.70

Accounts Receivable -

Inventory: Version 1 3,080.00

Version 2 2,560.00

Total Assets 118,488.70

LIABILITIES

PARTNERS EQUITY

Partners’ Capital 118,488.70

Owners Withdrawal -

Total Partners Equity 118,488.70

 32

Statement of Cash Flow

Table 16. Statement of Cash Flow for the Period of July to December

URBAN TOTE BAGS

STATEMENT OF CASH FLOWS
As of December 31, 2022
(In Pesos)
VERSION 1 VERSION 2 TOTAL

Cash Flows from Operating Activities

Cash Sales 186,531.00 51,336.00 237,867.00

Payment for Direct Materials (56,000.00) (15,000.00) (71,000.00)

Payment for Indirect Materials (4,000.00) (1,000.00) (5,000.00)

Payment for Labor (52,000.00) (16,000.00) (68,000.00)

Payment for Transaction Fee (1,867.50) - (1,867.50)

Payment for Shipping (2,200.00) (440.00) (2,640.00)

Payment for Freebies (450.00) - (450.00)

Payment for Advertisement (1,000.00) - (1,000.00)

Box (120.00) - (120.00)

Vouchers (1,000.00) - (1,000.00)

Net Inflows Provided by Operating 86,789.50

Activities

Cash Flows from Investing Activities - - -

Cash Flows from Financing Activities

Investment by the Partners 14,500.00 - 14,500.00

Added Capital 11,559.20 - 11,559.20

Net Inflows Provided by Financing - 26,059.20

Activities

Net Cash Inflows 112,848.70

 33

FINANCIAL RATIOS

The Urban Tote Bags' financial ratios, including their gross profit, net profit,

Return on Investment, and Return on Assets, are summarized in the table below.

Table 17. Summary of Financial Ratios of Urban Tote Bags

SUMMARY OF FINANCIAL RATIOS VALUE (%)
Gross Profit Margin (Version 1) 43.78 %

Gross Profit Margin (Version 2) 42.65 %

Net Profit Margin (Version 1) 37 %

Net Profit Margin (Version 2) 41.8 %

Return on Assets 354.69 %

Return on Investment 78 %

Gross Profit Margin

This financial metric reveals the amount of money available from sales after

deducting the cost of items sold to analyze a company's financial health. This shown

below that the Gross Profit Margin for the version 1 is 43.78 percent and the 42.65

percent for version 2. This percentage determined the computation on the revenue

minus cost of goods sold, divided by revenue, and multiplied to 100.

Gross Profit Margin (Version 1) = Revenue - COGS/ Revenue x 100

= ₱191,481.00 – ₱107,660.00 / ₱191,481.00 x 100

= ₱83,821.00 / ₱191,481.00 x 100

= 0.437751004 x 100

= 43.78%
 34

Gross Profit Margin (Version 2) = Revenue - COGS/ Revenue x 100

= ₱51,336.00 – ₱29,440.00 / ₱51,336.00 x 100

= ₱21,896.00 / ₱51,336.00 x 100

= 0.426523297491 x 100

= 42.65%

Net Profit Margin

It calculates the profit margin per peso so the table below shows the Net Profit

Margin for the version 1, is 37 percent and for the version 2 is 41.8 percent. The

percentage determined by the net income multiplied by one hundred is then divided

into revenue.

Net Profit Margin (Version 1) = Net Profit/Total Revenue x 100

= ₱70,973.50/₱191,781.00 x 100

= 0.3700757635 x 100

= 37%

Net Profit Margin (Version 2) = Net Profit/Total Revenue x 100

= ₱21,456.00/₱51,336.00 x 100

= 0.41795231416 x 100

= 41.8%

Return on Investment

This is a performance metric used to assess investment efficiency. The table

below shows that the Return of Investment for the both version of tote bags is 354.69

percent. The percentage determined by the profit minus cost of the investment divided

by net return multiplied by one hundred.

Return on Investment = Net Income/Cost of Investment x 100

= ₱92,429.50/₱26,059.20x 100

= 3.54630474 x 100
 35

= 354.69%

Return of Assets

This demonstrates the value of assets in terms of generating profits. The table

below shows the Return on Assets is 78 percent. The percentage determined by the

net income divided by average total assets, then multiplied by one hundred.

Return of Assets = Net Income/Average Total Asset x 100

= ₱92,429.50/₱118,488.70 x 100

= 0.780070167 x 100

= 78%
 36

PROBLEMS, SOLUTIONS AND INSIGHTS

In maneuvering the business, the entrepreneurs take a step in their business

and products by thinking and taking into position just like they are already in the

business segment. In every industry, there will be challenges and hindrances to your

growth. The players knew that there would always be problems to solve, especially

when making the products. In the case of Urban Tote Bags, the main challenge is

creating and manufacturing the products. It was hard for the business owners because

some of the things they needed to finish the products were expensive, precisely the

sewing machine.

Problems and Solutions

The first problem that the business encountered in the business is the lack of

needed machines and equipment which is necessary to create our product. We have

yet to buy any equipment as we also have insufficient funds for purchasing. Our team

also does not have any ideas on picking the most suitable sewing machine for our tote

bags. That is why we decided that it would be best for our business if we would just

find a tailor shop that offers the lowest labor price in creating tote bags. With these, we

can save up even more on our operating costs, making our products affordable for our

customers.

As we are a team of marketing students, it is our first time creating a business

that is in the fashion industry. They don’t have any knowledge in designing, sewing,

and how to make it much better and of high quality than the other tote bags that exist

on the market. The vision that we have for our product is limited as we lack skills in

creating fashionable products. However, we started researching and watching videos

on how to make a tote bag and make it much more distinguishable than the others.

We have also contracted a tailor to help us sew our product, and we are in charge of

the designs and providing raw materials to ensure the quality that we are going for.
 37

Our team is also checking closely with the bag's details to avoid any flaws or selling

damaged products to our customers.

Another problem that is being encountered by the business is that the

manufacturers need to commit to the allotted time being given to them while also not

producing enough bags that the owners expected. It serves as a significant disturbance

to reaching the business's monthly sales goals. Although the manufacturers meet the

quality and the standard, the owners are still having difficulty keeping up with the

consumers' demands due to low stocks. That is why the owners agreed to find and

contracted another manufacturer to increase the capacity of fulfilling the consumers'

orders. Since delivering on time is also critical, knowing the timeline between the

manufacturers of when the production of bags and when they will arrive is imperative.

Finding, buying, and delivering the raw materials came quite a challenge for

us. Since we have a distinctive feature for our product, making it water repellant, finding

the pul fabric in the market can be very difficult. Not many stores are selling this kind

of fabric due to lack of demand. Also, since we purchase our raw materials from

different stores, such as physical stores and an online shopping platform, the delivery

of the materials is not at the same time, which causes our production to delay. Our

team made a plan to avoid these from happening again. We decided to purchase and

stock up on more raw materials before production. In this way, we can avoid delays

and buy and order again if we see that our raw materials stock has become fewer and

needs to replenish again.

Another issue the business encountered was that brand etiquette could not

adhere to the tote bags for an extended period. It is quite a problem, especially for the

business, since it is critical to put the brand logo to claim that the bags we are selling

belong to our company. Luckily, the company knows excellent alternatives for this

problem to be fixed. First, we opted to use other hot melts, which are much more

dependable and a suitable adhesive for permanently bonding the etiquette to the tote
 38

bags. We have also figured out stitching the brand etiquette on the tote bags

themselves. This will ensure that the etiquette still clings to the bags while showing the

brand logo. The new batches of bags have already adopted these two solutions.

A further issue faced by the entrepreneurs was the meetings and schedule.

Some of its members have night shift work, and some have businesses to run. As a

result, there are times that some of its members are not available during meetings,

reports, and consultations. To resolve this problem, the entrepreneurs set up a meeting

where everybody has time to attend. They set up weekends as the time to do meetings

and talk about how they can improve the product. Luckily, the business owners have

been able to approach and overcome these issues.

Insights

Creating a business is a huge responsibility for an individual or group and it

comes with many challenges that will test an entrepreneur's ability. Building a business

is fulfilling, like executing your plans, including your imagination, being your boss, and

motivating yourself to do more. Also, you create an opportunity for yourself and others,

which is one of the great things in opening a business. Moreover, it is challenging

because some of the team have no idea or knowledge of how to create unique

products, but because of the teamwork of the entrepreneurs, they manage to do the

project. It is more fulfilling when the entrepreneurs take all the steps seriously and give

the best product to the customers. Making the customers happy and having relatively

positive feedback makes you want to create more products for them. The group did

this project, and they gained more knowledge and experience on how to put a business

in the future and how to motivate each other and have their selves improve.

As we take the business, there are fears and doubts about the products that

we are offering. There is the fear that our product might not sell after we have done.

Upon going on, we entrepreneurs realize that your business can never really grow if
 39

you are always worried about what could go wrong. Focus on the possibilities you

would like to have and be thankful for what you already have to fight fear. We push to

the limits, understand how we will market, and become knowledgeable about the

product because we believe that the more you know, the less you fear.
 40

SUMMARY AND CONCLUSION

Summary
The Urban Tote Bag is a start-up business that provides modern designs of

tote bags which are stylish yet space-saver tote bags that fit every generation. The

business was launched on July 03, 2022, right after it was approved in the fourth week

of April. Urban Tote Bags starts with contracting the chosen supplier, procuring all

needed materials, and handling it with the contracted tailor. The first steps in making

the bag are cutting the fabric to the required size and sewing the edges together to

create the bag's shape. It is composed of a corduroy fabric with stylish, aesthetically

pleasing designs on the surface and a water-repellent fabric on the inside. It is hemmed

together to ensure the quality of each product. The first version's tote bag's

measurements are 15 by 13 inches. In November, the entrepreneurs released a new

version of tote bags which measures 16 by 14 inches. The new version design was

landscape, unlike version 1, which has an alcohol holder and one pocket in front and

back.

The Urban tote bag's primary objective was to provide attractive, long-lasting

tote bags without exceeding customers' budgets. It also wanted to promote

environmentally friendly bags because these tote bags are made without plastic

materials. The business owners began marketing and selling their products from July

to November.

After six months of running the business, the entrepreneurs have sold 778

pieces of version 1 tote bags while 184 pieces of tote bags are sold for version 2, and

by that, the entrepreneurs have a total cost of 137,380.00.

 41

Conclusion

No matter how big or small the business is, whether it is a well-established one

or just starting, running a business is extremely difficult. Entrepreneurs encounter

problems or difficulties in different sections of their business. Entrepreneurs must deal

with these issues and challenges to succeed in the business sector because it also

serves as a stepping stone to their success.

Urban Tote Bags faced difficulties and setbacks. Because of this,

entrepreneurs might suggest a few areas to pay attention to while starting this

business. The first step is to conduct a business-related brainstorming session.

Consider the market state as the determining factor in the product choice. Start

planning the best product the entrepreneur can deliver after that to prevent complaints

from each other once production starts.

Next is choosing less expensive yet best quality supplies to be contracted with

to avoid producing low-quality products. For their first supplier, the entrepreneurs had

a problem producing the products because the supplier was slow in making the tote

bags, and some of the bags had flaws. After that, the entrepreneurs learn to ensure

that the supplier will meet their expected time and date of release and ensure its

quality. So, entrepreneurs found another supplier to be contracted with, which is better

than the first supplier.

Furthermore, when working in a group, the entrepreneurs need to maintain

effective communication with each group to keep each member's connection and

engagement so that they can work as a group and work efficiently. Entrepreneurs and

businesses can become more innovative and thrive in the market industry by

cooperating, understanding, and carrying out the procedure correctly.

 42

REFERENCES

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from https://www.collinsdictionary.com/dictionary/english/urban
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Tuovila, A. (2022). Financial Analysis: Definition, Importance, Types, and Examples.
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APPENDICES
 44

Appendix 1. Product logo

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Appendix 2.1. Payment for Supplier

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Appendix 2.2. Continuation

 47

Appendix 3. Sales Receipts

 48

Appendix 4. The Entrepreneurs

 49

Appendix 5.1. Sample Products

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Appendix 5.2. Continuation

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Appendix 6. Social Media of Urban Tote Bags

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Appendix 7. E-commerce Platforms of Urban Tote Bags

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Appendix 8.1. Product Deliveries

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Appendix 8.2. Continuation

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Appendix 9. Production Documentation

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Appendix 10.1. Customers Feedback

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Appendix 10.2. Continuation

 58

Appendix 10.3. Continuation

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Appendix 11. Certificate of Sponsorship

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Appendix 12. DTI Registration