PROPRIETOR

Olazo, Jean
Bugtong, Noime
Manalo, Helen
Briones, Maria Victoria
Legaspi, Marelyn
Espinar, Darriel
Fuentes, Aira

i
 Cake-a-licious Enterprises is a start-up business. The company name was created by
the group specifically having seven (7) members, which are Jean, Noime, Helen, Marelyn,
Victoria, Aira, and Darriel. The name comes from the two words which are “cake” and
“delicious”.

ii
i
COVER PAGE i

COMPANY LOGO ii

TABLE OF CONTENTS iii

INTRODUCTION 1

I.EXECUTIVE SUMMARY 2-3

a. Name of the Business

b. Goals of the Business
c. Location of the Business
d. Brief Description of the Business
e. Objectives of the Study
1. Organization and Management Aspect
2. Marketing Aspect
3. Operations and Production Aspect
4. Financial Aspect
5. Socio-economic Analysis
f. Scope and Limitation of the Study

II MARKETING ASPECT 4 - 14

a. Marketing Objectives of the Study

b. Vision

c. Mission Statement

d. Core Values

e. Market Research

f. Market Analysis
 1. SWOT Matrix/Analysis

g. Marketing Plan

1. Target Market

2. Marketing Mix (7Ps)

III. MANAGEMENT ASPECT 15 - 18

a. Management Objectives of the Study

b. Form of Ownership

c. Organizational Structure

d. Job Description and Specifications

IV. TECHNICAL ASPECT (OPERATIONS AND PRODUCTION) 19 - 28

a. Technical Objectives of the Study

b. Product Offered

c. Manufacturing / Operation Process (Method)

1. Process Flowchart

2. Narrative Description of Tasks Involved

d. Labor requirements (Manpower)

e. Machine

f. Materials

g. Plant Location and layout

h. Total Production Cost

V. FINANCE ASPECT 29 - 35
 a. Financial Objectives of the Study

b. Balance Sheet

c. Projected Financial Statements for the next five years

d. Break-even analysis

e. Cash Flow Cycle

VI. SOCIO-ECONOMIC ANALYSIS 36-37

a. Economic Factors

b. Technological Factors

c. Environmental Factors
 INTRODUCTION
Cupcake is type of cake which originated from the United States, and it is a small cake
that is baked in small thin paper or aluminum cup and designed in different unique designs to
serve just one person. Aside from the fact that it is a small cake, it still contains icing, candy or
all other decoration that can be found in traditional big cakes. Please note that cupcakes can also
be called fairy cake or patty cake especially in places like England and Australia. The truth is
that, if you are a baker or even a caterer, it is easier for you to venture into cupcake business.
This is so because the same ingredients and processes that are used in making the conventional
large cakes are the same ingredients and processes that are used in making cupcakes except for
the size difference. The basic ingredient that is used in cupcake making is flour, butter, sugar,
eggs, frosting and cake decorations.

One thing about cupcake business is that it is your creativity is one of the things that can
stand you out from your competitors. No doubt, people who are into cupcake making are very
creative. And that is why you can come across cupcakes in different shapes, designs and flavor.
For example; we have cupcakes in different variants such as butterfly cupcake, cake in a jar, cake
ball, elaborately frosted cupcakes, and gourmet cupcake. The bottom line is that if you are
creative enough, you can design your cupcake to represent any celebrated events or occasion.
Beyond every reasonable doubt, a cupcake business is indeed a profitable business because you
can operate the business with your family members from your kitchen thereby cutting operational
cost to the barest minimum. So also if you are able to secure a strategic high traffic location to
open a shop, you can be rest assured to rake in good returns from your cupcake business

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 CHAPTER 1

EXECUTIVE SUMMARY

Name of Business

The name of the business is Cake-a-licious. It comes from the word cake and
delicious.

Goal of Business

Cake-a-licious doesn’t only look on the profitability of the business, but also aims
to contribute to the municipality’s economic growth.

The main objective of the business is to create a product that will give satisfaction
to its customers. Cake-a-licious also aims to generate reasonable profit for the enterprise
and create more job opportunities for the locals of Balayan.

On the starting line, Cake-a-licious focuses on producing easily-but-creatively-

made cupcakes, but in the long run, cake-a-licious aims to establish a strong enterprise
that is able to produce various sweet products.

Location of the Business

Since Cake-a-licious is a start-up business, it must be located at a populated place,

so it would be easily recognized. So its proposed location is in Barangay Ermita,
Balayan, Batangas.

Brief Description of the Business

Cake-a-licious flag bearer product is called “Heaven’s Cake” which is a easily-

but-creatively made cupcake. Filipinos are known for being sweet toothed, so Cake-a-
licious took advantage of it offering a product that will give them satisfaction both in
sight and taste. Because of that, it will be known for the tagline: “For Heaven’s Cake! It’s
a Cloud Nine Feeling.”

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Objectives of the Business

a. Marketing Aspect

To position itself as the leading manufacturer of creatively-made cupcakes

To provide a great taste cupcake within the Balayan and its neighboring time in Batangas

To make a product that is affordable yet satisfying to its customers.

Management Aspect

To establish a name in baking industry in Batangas and

To create more job offerings to the locals of Balayan through Cake-a-licious product
offerings.

Technical Aspect

To establish a start-up business that manufacture’s a creatively-made cupcakes

To create a food product that is of high quality and will provide value addition to the
customers; and

To ensure that all the operation process in our business is functioning well to meet the
demand of our customer.

Financial Aspect

To establish a profitable and successful business and

To achieve a return of investment in the soonest possible time

Socio Economic

To know the impact of the business to the economic performance of the municipality of
Balayan and

To contribute to the economic development of the municipality through a baking industry.

f. Scope of the Study

The scope of the Cake-a-licious will only be within the municipality of Balayan and
its neighboring towns in the province of Batangas.

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 CHAPTER 2

MARKETING ASPECT

Marketing Objectives of the Study

Under the marketing component, Cake-a-licious identified the following

objectives:

1. To position itself as the leading manufacturer of creatively-made cupcakes

To provide a great taste cupcake within the Balayan and its neighboring time in Batangas

To make a product that is affordable yet satisfying to its customers.

A. Market Description

In the starting line, Cake-a-licious will produce “Heaven’s Cake.” Balayan isn’t
yet well-known in baking industry so Cake-a-licious though many bakeries are
established within the municipality. But what differs “Heaven’s Cake” from other
cupcakes is that its icing is already mixed with the cupcake itself, but it still has creative
design on top.

Cake-a-licious doesn’t only look on gaining profit but also desires to help Balayan
to be well-known in baking industry, not just in the municipality but also to its
neighboring towns in Batangas.

B. Vision Statement

Cake-a-liciosus visions itself to be the leading manufacturer of satisfying yet low

cost creatively-made sweets in CALABARZON.

C. Mission Statement

Cake-a-licious is commited to introducing new designs of cupcakes.

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D. Core Values

1. Quality: High quality food products

1. Socially Responsible: Advocate for sustainable development

2. Continuous Development: Open to any improvement

3. Integrity: Strong belief that honesty is the best policy

4. Employee Friendly: Equal treatment to every employee

E. Market Research

Cupcake

A cupcake is a small cake designed to serve one person, which maybe baked in a
small thin paper or aluminum cup. As with larger cakes, icing and other cake decorations
such as fruit and candy maybe applied.

Baking

Baking, in itself, goes back at least a thousand years. The use of enclosed ovens,
to produce bread and pastry, was probably introduced by European explorers and
colonizers. Pies, and cakes, were prevalent in Europe during the 17 century, and as the
continent spread its reach across the seas, they brought the art of baking along with it.
One school of thought is that Spanish missionaries introduced baking to the Philippines.
Wheat was often used in food, by missionaries, who introduced the diet, as well as the
preparation and process to the locals.

On the other hand, as early as 618 AD, China was already making “moon cakes”
and the early settlers and traders who landed on Philippine shores, also inevitably shared
this unique process of using dry heat to make bread and other desserts.

However, let do not forget the contribution of Malay ancestors, who introduced
sticky rice cakes and layer cakes. One can argue that the Malay’s knowledge of baking
was still derived from their Dutch colonizers, but the ingenuity in the use of local

5
 ingredients such as rice, corn and coconut, as well as making do with clay pots
and wooden steamers, created something totally original.

The Kueh Lapis, with its colorful appearance and layered arrangement, makes it a
likely source of inspiration for our Sapin-sapin.

Similar to many aspects of Philippine life, our history as a baking country is

comprised of influences from many different cultures. From there, it became part and
partial of growing up Filipino.

Food items such as Ensaymada, Sapin-sapin, Leche Flan and Biko were integral
to one’s childhood. Having baked goods at home became a common thing. Breakfast
would consist of Tasty Bread, and Puto or Mamon would be there during merienda.

For the everyday Filipino, there was the “bakery sa kanto” (neighborhood bakery)
that satisfied one’s craving for Pandesal, Kalayaan and Monay.

For those who could afford their own oven, having newly baked cake, cookies,
bread and similar desserts, became staple during mealtime, snacks and feasts.

The importance of baked goods in Philippine tradition is undeniable. With so

many foreign influences that made their mark in how baking developed in the
Philippines, there is no definitive answer really, to how it all began. What we do know, is
the importance of this wonderfully delicious art, and how it has since been vital in every
Filipino’s life.

Sample Questionnare 6
Name :
 Product name :

Statements SD D A SA

1 The product has something that other`s don`t have.

2. Consumer wil buy it more because of affordable price.

3. Consumer will avail it for its delicious taste.

4. It`s design or package will help us attract more consumer.

5.It`s taste is all that matters.

6. A unique way of making it makes people avail it.

7. Consumer want to contract proponents for comments and

suggestions.

8. It may be great if the proponents will make different flavors that is

suited for a person`s mood.
9. It would be better if we will make a facebook page for
advertisement.

10. It is an advantage for proponents if they know how to use different

strategies in advertising it.

Directions : Put check if you are SD (Strongly Disgaree), D (Disagree), A (Agree), SA

(Strongly Agree) in every statement.

INTERPRETATION 7
1. The respondents agree that this product has something that other`s don`t have which weigh at
the scale of 4.3.
2. At the scale of 4.4, the respondents agreed that the consumers will avail it more because of its
affordable price.
3. At the scale of 4.2, the respondents agreed that the consumers will avail it for its delicious
taste.
4. At the scale of 5, the respondents agreed that the design or package will help us attract the
customers.
5. At the scale of 4.2, the respondents agreed that the taste is all that matters.
6. The respondents agreed that a unique way of making the cupcake makes people avail it which
weigh at the scale of 4.4.
7. At the scale of 4.9, respondents agreed that consumers want to contact proponents for
comments and suggestions.
8. At the scale of 4.1, the respondents agreed that it may be great if the proponents make
different flavors is suited for a person`s mind.
9. At the scale of 4.5, it would be better if the proponents make a facebook page for
advertisements.
10. At the scale of 4.7, the respondents agreed that it is an advantage for the proponent if they
know how to use different strategies in advertising their product.

G. Market Analysis
1. Present Consumption Trends

Consumption of baked goods seems to be in high level since Filipinos love sweets.
However, because “bakeries” got known—which often doesn’t sell cupcakes, but “pandesal,”
“pandecoco,” etc.—cupcakes do not get much attention in the market.

1. Present Markets
Majority of the markets of Cake-a-licious are in Balayan and in the first
district of Batangas; this includes Nasugbu, Lian, Calatagan, Tuy, Lemery and
Calaca.

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2. SWOT Analysis
Strengths of the Business
1. Good Brand Recognition
The brand name is noticeable in a product. Any product that has
good name is easily recognized in the market. It attracts the customers
when they hear of a catchy and easy to remember product name.

2. High Quality Product

Customers don’t just look for a good product name that attracts them but
most especially to its quality; so Cake-a-licious chocolate coated cupcake
ensure outstanding taste that will satisfy customers’ sweet craving.

Weaknesses of the Business

1. Lack of Reliable Source of Raw Materials
It is hard to find a reliable source of raw materials, since it is a
cupcake composed of eggs, milk, and etc. As manufacturers, Cake-a-
licious must secure its customers health. Every ingredient must be fresh or
processed well or else may cause food poisoning.

2. Lack of Capital
The reason why most entrepreneurs cannot expand their business
and lose the chance of introducing their product in a larger market is the
lack of capital.

3. Lack of Formal Training

Because of lack of formal training for employees, a business may
fail because of their inadequacy and lack of knowledge about the product
production, especially in baking industry.

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 4. Lack of Financial Support from the Government
Most of the entrepreneurs in Balayan need capital to improving their
business, nevertheless they are hardly given financial support.

Opportunities

1. High Demand of Cupcake in the International Market

Because it is in the blood of Filipinos to be fond of sweets, cupcakes are
highly demanded in the market.

2. Great Chance to Innovate in Terms of Flavoring

Through the help of a FaceBook page, Cake-a-licious can hear suggestions
and comments from the customers regarding the taste and flavors. Improving
its flavor can make the customers buy the product repeatedly with different
satisfying taste.

3. Great Chance to Improve in Terms of Design

Great design may help attract and satisfy the customers’ sight. Improving
its design can make customers not to find the product odd.

Threats in the Industry

1 High Price of Raw Materials
Because Cake-a-licious aims to secure the health of its consumers, raw
materials itself must be safe and trusted also. And usually, these “safe” and
“trusted” raw materials, come with high price.
2. Competitors
Competitors rise every once in a while. Since it is in baking
industry, sweet-toothed and creative Filipinos may also create greater
products and produce it in a larger market.

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 3. Increase in Price of Other Materials for the Production
Prices of direct raw materials are not just what a manufacturer is
concerned about in the production but even for the prices of the materials for
packaging, such as boxes and the likes.

SWOT MATRIX

EXTERNAL OPPORTUNITIES THREATS

O1.High demand of cupcake T1.High price of raw
O2. Great chance to innovate materials.
flavor. T2.Competition
O3. Great chance to innovate T3. Increase of costs of other
INTERNAL in terms of design. materials.

STRENGTHS S1 – O1: Create more product.

S1- T2: Create products that
S1. Good brand recognition. will be unique from other
S2-O2: Make new flavors for
S2. High quality product. customers competitors.
S1-T1: Look for other
suppliers.

W1 - O1: Look for potential

WEAKNESS
W1 : Lack of Capital
W2 :Lack of formal training
for employees
W3 :Lack of financial support
from the government
investors. W21- T1: Try alternative raw
· materials.
W2 - O2:Create opportunities
for the employees to attend ·
atleast some seminars ·
regarding baking.

Figure 1. SWOT MATRIX

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A. Marketing Plan (Marketing Strategies)

Targeting Plan

1. Target Market
The target market of Cake-a-licious is mainly the locals of Balayan. Cake-a-licious is
assumed to have high acceptability from the consumers. The market of cake-a-licious also
includes other neighboring areas of Balayan in the province which includes Nasugbu, Lian,
Calatagan, Tuy, Lemery and Calaca.

2. Marketing Mix

a. Product
Heavens’s Cake is a sweet cupcake made to satisfy customers’ sweet cravings. It is
unique from other cupcake because of its chocolate coating.

b. Place
Cake-a-licious must be placed in a populated place for it to be easily recognized, so it
will be placed at Barangay Ermita, Balayan, Batangas. It will be distributed at commercial stores
within the municipality of Balayan and to its neighboring towns in Batangas.

Geographical Distribution
Manufacturers have their own individual markets for their products. The products will be
sold at Balayan, Nasugbu, Lian, Calatagan, Tuy, Lemery and Calaca.

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 Ways to Reach the Market
To reach the target markets, each of the bakeries have their own means. And for Cake-a-
licious to reach the market, different vehicle will be used such as tricycle, jeepney, etc. Here is
the ideal distribution system for Cake-a-licious’ Heaven’s Cake

CAKE-A-LICIOUS`S HEAVEN`S CAKE

Balayan Senior High

c. Price School
As an introductory, Heaven`s cake is priced at Php 10.00 per piece.
CAKE-A-LICIOUS`S HEAVEN`S CAKE
d. Promotion
Other As apastry shops/
promotional
Brgy.
activity Heaven`s Cake will take advantage through words-of –mouth
bakeries
advertising the in Balayan
proponents Ermita,Balayan,
will also use facebook page in promoting their product.
e. People Batangas
Cake-a-licioous enterprises is a start-up business. The core people that are responsible in the
implementation of heaven`s cake areFigure 2. WAYS
Darriel Espinar, Vctoria
TO REACH Briones, Noime Bugtong, AiraFuentes,
THE MARKET

Marelyn Legaspi, Helen Manalo, and Jean Olazo.

f. Packaging
Since the proponents will be selling their products per piece, packaging is not a big deal here. But
to make the product presentable they will add some decorations such as sprinkles.
Balayan Senior High
School

Other pastry shops/

bakeries in Balayan
Figure 2. Ways to reach the market

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 Php
10.00

Brgy. Ermita, Balayan, Batangas

Product Sample Flyer

g. Positioning
The proponents want their product to be remembered as one of the most
unforgettable cupcake they had tasted. They will use the tagline “For Heaven`s
cake it`s a cloud nine feeling”

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 CHAPTER 3

ORGANIZATON AND MANAGEMENT

A. Management objectives if the study

The following are the objectives of Cake-a-licious Enterprises under Organization and
Management aspect of its operation:

 To constitute a new product line of business that will caught the attention of the
customers;
 To create a name in the pastry industry in Batangas;
 To offer job opportunities to the locals of Balayan though the cake-a-licous corporation.

B. Form of Ownership

Cake-a-licious is a form of business that is owned by a group of friends. The operation is

controlled by the owners, Ms. Jean Olazo, Ms. Noime Bugtong, Ms. Helen Manalo, Ms. Victoria
Briones, Ms. Marelyn Legaspi, Ms. Aira Fuentes and Mr. Darriel Espinar

C. Organizational Structure

Since it is a start-up business the corporation is basically divided into two (2) major areas,
the Operations Department and the Finance and Administrative Department.

The Operation Department (OD) is headed by Jean , she will be assisted by Helen, Aira and
Darriel. Under the production, there are two employees. Cake-a-licious corporation's Finance and
Administrative Department (FAD) is handled by Noime and will be accompanied by Marelyn,
Aira and Victoria, there are also two employees there.
 15

Cake-a-licious
Enterprises

Finance and Administrative

Operation Department Department
(Jean, Helen, Aira and Darriel) (Noime, Marelyn, Victoria)

Production Accounting and Personnel

Employee Employee Employee Employee

Figure 2. PRESENT ORGANIZATIONAL STRUCTURE OF THE CAKE-A-LICIOUS ENTERPRISES

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D. Job Specifications and Description

Since Cake-a-licious Enterprises is just a start-up business we only have 11 employees.

Jean Olazo is the president of the company since she has the capability of leading us. Noime
Bugtong as the Vice President. Helen Manalo, Victoria Briones, Marelyn Legaspi, Aira Fuentes
and Darriel Espinar will be the board members of the company. Our eleven (11) employees will
be divided into three teams, the first team will be the baking/cooking team it is composed of 3
members in which they will be payed Php. 12,000.00 per month. The second group is composed
of 4 members in which they will be assigned in the designing of cupcakes. They will be
compensated Php. 8,000.00 per month. And lastly, the third group which will be composed of 4
members they are the one who will endorse and sell the product. Their monthly salary will be
Php. 5,000. 00.

Roles and Responsibilities

Chief Baker / Chief Executive Officer – CEO (Owner):

 Increases management’s effectiveness by recruiting, selecting, orienting, training,

coaching, counseling, and disciplining managers; communicating values, strategies, and
objectives; assigning accountabilities; planning, monitoring, and appraising job results;
developing incentives; developing a climate for offering information and opinions;
providing educational opportunities.

Bakery Manager:

 Responsible for overseeing the smooth running of the bakery;

 Part of the team that determines the quantity of cupcakes that are to be produced daily.

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Bakers / Casual Workers:

 Responsible for preparing different flavor and style for cupcakes and all our bakery
products;
 Responsible for carrying out all casual or unskilled jobs in the bakery;
 Responsible for operating sealing and packaging machines.

Accountant / Cashier:

 Responsible for preparing financial reports, budgets, and financial statements for the
organization;
 Provides managements with financial analyses, development budgets, and accounting
reports; analyzes financial feasibility for the most complex proposed projects; conducts
market research to forecast trends and business conditions.

Cleaners:

 Responsible for cleaning the bakery facility at all times;

 Ensure that toiletries and supplies don’t run out of stock;
 Cleans both the interior and exterior of the bakery facility

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 CHAPTER 4

TECHNICAL ASPECT

OPERATIONS AND PRODUCTION

This aspect of the study states and identifies whether the product being offered is at the highest
quality with minimum cost. It also covers the assets being used by the business for it to be
operated successful such as machine and equipment’s, furniture and fixtures, office supplies and
utilities supplies.

Specifically, the following are the technical objectives of Cake-a-licious Enterprises:

 To establish Cake-a-licious as a start-up enterprise that manufactures cupcakes;

 To create a food product that is of high quality and will provide value addition to
the customers; and

 To maximize the use of the equipment and machine in order to operate more
efficiently and effectively.

A. Product Offered

Cupcake decorating are the unique way to separate your cupcake business from others.
By offering cupcake decorating to customer an attractive that will keep them comeback for more.

B. Manufacturing / Operation Process

Since cake flour is the dominant ingredient in making cupcakes, Cake-a-licious

enterprises seeks the best cake flour suppliers within BALAYAN. The other ingredients such as
eggs, milk, vanilla, baking powder, and sugar will be supplied by the Balayan Market.

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 C. Process Flow Chart for Heaven's Cake

Heat the butter in a saucepan, over low heat and a pinch of salt then add milk, sugar mix with
cake flour beat an egg.

For icing (mix the white egg and vanilla) add sugar a little bit at a time until stiff peak.

About 5 minutes. It's best to use a balloon whisk.

Turn the small amount of white egg into the butter.

Mix well and turn back the butter into the whites.

Divide evenly among pan and gently squeeze and create any pattern or decoration they wanted.

Baked in preheated oven 150°c for 18 minutes.

Put 3 cupcakes in a box then cover and put a ribbon into it.

Figure 3. Process Flow Chart for Cake-a-licious`s Heaven`s Cake

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 The process flow chart are based on our product the first step is heat the butter in a
saucepan, over low heat and a pinch of salt then add milk, sugar mix the cake flour and beat an
egg. For icing we need the white egg and vanilla then mix it. Add sugar a little bit at a time, until
stiff peak. In five (5) minutes it's best to use a balloon whisk. Turn the small amount of whites
into the butter mix well and turn back the butter into the white icing. Then divide evenly among
pan and gently squeeze and create any pattern you want. Baked in preheated oven 150°c for 18
minutes. Last put 3 cupcakes in a box then cover and put a ribbon into it.

1st 2nd 3rd 4th 1st 2nd

Activity/Process Quarter Quarter Quarter Quarter Quarter Quarter of
of 2018 of 2018 of 2018 of 2018 of 2019 2019
Preparation of the Business Plan

Resource Generation

Preparation of the available area

for operation

Preparation of Documents for

licenses and permits

Procurement of factory and office

supplies, equipment, machinery

Procurement of raw material

supply

Start of Normal Operation.

D. Raw Materials
21
 22

The
following are
the raw
materials
used in
baking our
Heaven`s
Cake.

Figure
4. Cake
flour

Figure 5. Milk
 Figure 6.
Vanilla

Figure 7.
Eggs

23

Figure 8. Sugar Figure 9. Confectioner Sugar

Figure 10. Chocolate Syrup Figure 11. Paper Liner

24

The common materials that we will be using in

making Heaven`s cake are the cake flour, sugar,
eggs, milk, vanilla, confectioner sugar, salt, and
chocolate syrup or chocolate powder.

E. Machine
Figure 12. Mixer
Figure 13. Oven

This machines will be used to make our product. We will use the electric mixer to mix
our ingredients such as cake flour, sugar, egg, and vanilla. We will also use it for making icings.
Then we will be using the oven to bake our cupcakes.

25

F. Plan Layout and Location

Cake-a-licious use a bakery shop at brgy. Ermita, Balayan, Batangas. The capacity
planning refers to the amount of output that can be produced within a specified time.

F. Production cost
Since it is just a start-up business, Heaven's Cake target to produce an average production
of 3,000 per day.

Total Cost of Production

 The total cost of production includes all the necessary expenses incurred upon the
production of heaven's cake. The expenses of Heaven's Cake includes raw materials cost, labor
cost, overhead cost and operating cost.

Table 1. Breakdown of Working Capital in Terms of Raw Materials

Item Unit Price # of Units Total Cost

1. Cake flour P 810.00 520 sacks P 421, 200.00

2. Vanilla P 39.00 1,560 bottles P 60, 480.00
3. Egg P 130.00 6,500 trays P 845,000.00
4. Evaporated Milk P 20.00 6,500can P 130,000.00
5. Confectioner sugar P 2500.00 390 sacks P 975,000.00
6. Sugar P 2500.00 390 sacks P 975,000.00
7. Paper liner P 75.00 52,000 boxes P 3,900,000.00
8. Chocolate syrup P108.00 7,800 bottles P 842,400.00
TOTAL ANNUAL COST P 8,149, 440.00

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Table 2. Breakdown of Working Capital in Terms of Labor Cost

Job Description Salary/month Month/year Total no. of Total Cost

workers
1. Cook 12,000 12 3 432,000.00
2. Designer 8,000 12 4 384,000.00
3.Endorser/seller 5,000 12 4 240,000.00
Total 5 1,056,000.00
 The cost in labor cost are total of P. 1,056,000.00 and it's give to the cook, designer of
product and endorser or seller. Every month the salary of cook is P. 12,000.00 for designer P.
8,000.00 and for endorser or seller are P. 5,000.00

Table 3. Breakdown of Working Capital in Terms of Overhead cost and List of Machine,
Equipment and tools

Machine/ Unit No. of unit Cost of Total cost of Life Depreciation

investment span
Equipment required Investment
1. Oven Piece 2 5,000.00 10,000.00 5 2,000.00
2. Mixer Piece 2 4,000.00 8,000.00 3 2,666.67
3. Piping Set 24 45.00 1,080.00 1 1,080.00
bag/pin
4. Muffin
Piece 4 300.00 1,200 1 1,200.00
pan
Total
9,345.00 6, 946.67

27

The total cost of P. 6,946.67 the most expenses are the oven with P. 10,000.00. And the others
are for Mixer, Muffin pan and Piping bag.

Table 4. Breakdown of Working Capital in Terms of Operating cost

Expenses Monthly Cost Month/year Total Cost

1. Electricity Bill 5,000.00 12 60,000.00
2. Transportation Bill 5,000.00 12 60,000.00
3. Space Rental 3,000.00 12 36,000.00
Total 156,000.00

Table 5. Summary of the Breakdown of the Estimated Working Capital and their percentages

Expenses Item Total Cost Percentage to total cost

1. Direct Raw Materials 8,149,440.00 87%
2. Labor Cost 1,056,000.00 11%
3. Overhead Cost 6,946.67 O%
4.O operating Cost 156,000.00 2%
Total 9,368,386.67 100%

CHAPTER 5
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FINANCIAL ASPECT

This study is all about the financial requirements of Cake-a-licious that involved its
operation and establishment. Here are identified objectives:

 To establish a profitable and successful business and

 To achieve a return of investment in the soonest possible time

A. Total project Cost

Cake-a-licious’ Heaven’s Cake
 Total Project Cost
Property Plant Equipment (PPE) Amount

Factory Equipment (machine/equipment) 20, 280

Office equipment and furniture 60,000

Vehicle 60,000

Total: 140, 280

Working Capital (First Year of Operation)

Direct Materials 8, 149,440

Direct Labor 1,056,000

Overhead Cost 6, 496.67

Operating Expenses 156,000

Total: 9,368,386.67

Add Contingency: 285,260.01

Total Project Cost: 9, 793,926.6

Table 6: TOTAL PROJECT COST

B. Projected Income Statement

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 Projected Income Statement of Cake-a-licious’ s Heaven’s Cake

First Year of Operation

SALES 7, 800,000

LESS: COST OF GOOD SOLD 1, 925,400

Cake flour 421, 200

Vanilla 60, 840

Egg 845, 00

Evaporated Milk 130,000

Confectioner Sugar 975,000

Paper liner 975,000

Chocolate syrup 842,400

LABOR COST 1,056,000

OVERHEAD COST 6,946.67

OPERATING COST 156,000

TOTAL COST OF OPERATION 9,793,926.68

NET INCOME 1,993,926.68

Table 7. PROJECTED INCOME STATEMENT FOR FIRST YEARS OPERATION

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PROJECTED INCOME STATEMENT OF CAKE-A-LICIOUS`S HEAVEN`S CAKE
 (FIVE YEAR PROJECTION 2018-2022)

Table 8: INCOME STATEMENT FOR FIVE YEARS OPERATION

C. Break-even Analysis

The break-even analysis for the operation of CAKE-A-LICIOUS`s HEAVEN`S CAKE Balayan
is done to determine the number of cupcakes that will be produced to avoid losses. The important
factors or items that were considered in the calculation of the break-even point were the fixed costs,
variable costs, selling price per unit, and number of units produced. Fixed costs refer to all costs that do
not vary as production increases or decreases. Variable unit cost is the cost that varies directly with the
production of one additional unit. The

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 expected unit sales is the number of units of the product projected to be sold over a specific
period of time. The formula that has been use in Heaven`s cake is like this.

Fixed cost + (number of units sold x variable cost per unit)

Break-even point = ----------------------------------------------------------------

Selling price per unit

Fixed cost:

Overhead Cost 6,946.67

Operating Expenses 156,000.00

Labor Cost 1,056,000.00

Total Fixed Cost 1,218,946.6

Total Variable Cost

Raw Materials and Other

Costs 8,149,440.00

Total Variable Cost 8,149,440.00

8,149,440.00/780,0
Variable cost per unit 00 = 10.45

= Fixed cost + Variable Cost

= 1,218,946.6 + 8,149,440.00
Total Cost

9,368,386.6
=

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Given all these data, the computed BEP was:

Fixed cost + (number of units sold x variable cost per unit)

Break-even point (BEP) = ---------------------------------------------------------------
Selling price per unit
= P1,218,946.6 + (780,000units XP10.45)
----------------------------------------------------
P 10
BEP = 936,994.66units

CHAPTER 6
SOCIO- ECONOMIC ANALYSIS
Factors affecting the Business

I. Economic Factors

Since our product is quite specialized, the prices are quite high, in the event of
extreme inflation or a recession, foods like cupcakes and decadent desserts become a
luxury to a lot of people and become something that can be avoided. In this case, in
order to keep the revenue up and have customers buy our products, we may have to
decrease the price of our products and since it is a luxury product, it is quite an elastic
product since it is not a staple for the home. However, Heaven's cake may suffer some
losses since we do pay a high price for our supplies.

II. Technological Factors

Technology does not play a huge impact on a pastry shop however, as

technology does improve, it can allow us to make our website and our business more
well known to the public especially when we consider expanding out to other countries.
New cooking products could make the process more effective and increase productivity.

III. Competitive Factors

First and foremost, the fact that anybody with baking skills can decide to start
cupcake means that the business is open to all and sundry, hence it is expected that there

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will be a high-level of competition in the industry. There is hardly any busy

community or even street that you won't find one or more people retailing cupcakes.

As a cupcake baking and retailing business, we know that gaining a competitive

edge requires a detailed analysis of the demographics of the surrounding area and the
nature of existing competitors. And even if you are successful at first, new competitors
could enter your market at any time to steal your regular customers. Hence we will not
hesitate to adopt successful strategies from our competitors.

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