Republic of the Philippines

BATANGAS STATE UNIVERSITY

Pablo Borbon
Rizal Avenue, Batangas City

COLLEGE OF ACCOUNTANCY, BUSINESS, ECONOMICS AND

INTERNATIONAL HOSPITALITY MANAGEMENT

TAROSTILLAS

In Partial Fulfillment for MGT 305 Entrepreneurial Management

Second Semester, AY 2020-2021

TONIROSE D. EVANGELIO
SHIELA MAY P. FERRY
TRISHIA LIEGH F. MATIRA
MARY GRACE S. PANGANIBAN
KHEYZEL C. PLATA
JOVELYN C. UMALI

OMGT 3201

ANGELYN R. AMUL, MBA

INSTRUCTOR

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 TABLE OF CONTENTS

Executive Summary 4
CHAPTER I
Background of the Study
Introduction 6
Overview of the business 7
Business and Industry Profile 7
Business Strategy 8
Company Products/ service 9
CHAPTER II
Marketing Plan
Target Market 11
Demand and Supply Analysis 11
SWOT Analysis 15
Marketing Programs and Strategies 16
Marketing Expenses 19
CHAPTER III
Operational Plan
Operations Description 20
Plant Location 20
Plant Layout 23
Manufacturing Process 24
Production Schedule 25
Labor Requirements 25
Raw Materials 26
Equipment Requirements 27

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 Furniture and Fixtures 28
Tools and Supplies 28
Utilities 30
Production Cost 30
CHAPTER IV
Organizational Plan
Form of Business Ownership 35
Capitalization 36
Manpower Requirements 37
Organizational Structure 38
Job Description and Specification 39
Compensation and Benefits 42
Legal Requirements 46
CHAPTER V
Financial Plan
Total Project Cost 51
Sources of Financing 53
Financial Assumptions 53
Financial Statement 58
Break-even Analysis 68
CHAPTER VI
Socio-Economic Contribution 73
Bibliography 76

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 EXECUTIVE SUMMARY
Our Mission

Tarostillas offers new organic flavored pastillas that is hundred percent (100%) authentic
and affordable for everyone. It is good for everybody, whether an adult or youth because it
provides fiber and other important nutrients. Our team will ensure that everyone craving for
sweets will enjoy having sweets without risking their health but instead they can maintain their
balanced diet. We also ensure that critical factors can be avoided by doing the right process and
following the procedures rightly and ensuring the best taste of the Tarostillas.

The Company and Management

The business, Tarostillas is located in Brgy. Balagtas and incorporated in the City of
Batangas on February 22, 2021. The company is owned by partners: Tonirose Evangelio, Shiela
May Ferry, Trishia Liegh Matira, Mary Grace Panganiban, Kheyzel Plata, and Jovelyn Umali.
The owners are college friends and all of them are knowledgeable when it comes to managing
business as they took business administration courses. The management of Tarostillas consists of
Ms. Panganiban as the General Manager, Ms. Evangelio as the Financial Manager, Ms. Umali as
the Accounting Manager, Ms. Matira as the Human Resource Manager, Ms. Ferry as the
Marketing Manager and Ms. Plata as the Operations Manager. Owners will be taking hands-on
management roles and will provide management expertise in the company.

Our Services

Health is the utmost priority while the owners come up with the product. Our clients are
those people who craves and likes sweets but they can’t have it because of their health
conditions. Tarostillas was specially made for clients who are vulnerable to chronic disease like
diabetes, obesity, cardiovascular disease, and non-alcoholic fatty liver disease (NAFLD) as well
as cognitive decline and even some cancers. Tarostillas offers a product which will take care of
your sugar intake while having sweets that you’ve love.

The Market

Across Batangas City the sweets business has seen a growing competition over the last
years. Batangas City is an affluent area entering high-density market with a new product. Our

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market research has shown that 53% out of 100 consumers of pastillas polled in Batangas City
are willing to purchase Tarostillas (Pastillas made of Taro/Gabi) and it also shown that 69% of
them would recommend the product to their family and friends. Even Tarostillas is new to the
market, we have seen that it has the potential in growing market and we can guarantee that it will
be the next favourites of sweets in the market. Eventually sooon Tarostillas will make variety of
sweets that will satisfy consumers’ needs while focusing on its consumer’s wellbeing.

Our Competitive Advantages

While there are currently four businesses (JAI’s Special Pastillas, Marky Milky Yema
Pastillas, Michael’s Pastillas, and Nanay Sianang’s Pastillas) offering pastillas in Batangas City,
all of them only offers classic flavours and since Tarostillas is new to the market it will serve as
our advantage in the market.

Tarostillas marketing strategy is to emphasize the quality of tarostillas we provide and the
availability of our services. Tarostillas adhere 7P’s of Marketing and will implement the
following strategies to achieve its goal of becoming one of the leading sweets in Batangas City:

 Create a compelling value proposition for both owners and customers

 Employee will undergo trainings to ensure that they will serve the best quality product.
 Meeting the customers satisfaction
 Provide the best service quality

Start-up Financing Requirements

There are 6 owners which will use as an advantage as they can help each through their
shared ideas and concept to make the business grow and successful. The owners are seeking an
operating line of PHP 4,000,000 as their initial investments. Together, the limited partners have
invested PHP 664,000; 16.6% of the total capital while the general partner invested 17% which
is PHP 680,000 of the total capital of the business to be able to meet working capital
requirements.

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 Chapter I
BACKGROUND OF THE STUDY
Introduction

Filipinos are known to have an exceptionally sweet tooth (Lasco, 2018). It means
that they like sweets like chocolates, candies etc. because in Filipino cuisine, sugar is
everywhere. Often, sweets will give them satisfaction and greatest amount of energy.
Today, there are lots of goods and sweet products that exist in our market. There are
chocolates, candies, cakes, ice cream, doughnuts, pastillas with different flavours and
many more.
Eating too much added sugar can have many negative health effects. An excess of
sweetened foods can lead to weight gain, blood sugar problems, and an increased risk of
heart disease, among other dangerous condition. As having a sweet tooth of the Filipino, it
will be hard for them to avoid eating sweets. Therefore, the proponents collide in the idea
of making pastillas that is made of Taro. It is a delicious sweet treat called Tarostillas, the
pastillas made of taro with coated chocolate and powder. It is the first and newly
flavoured pastillas in the market. This pastillas is not only delicious, but it is affordable,
clean, nutritious and enjoyable. It will satisfy the customers because of its tasty and
different flavour. This is an organic pastillas, so customer will benefit in consuming it and
will not cause a threat in their health.
Taro or Gabi is a perennial tropical or subtropical plant commonly grown for its
starchy but sweet flavoured tuber (Steve Albert, n.d.). It is a good source of fiber and any
vitamins and minerals. It contains fiber and resistant starch that can slow digestion, reduce
blood sugar spikes after meals, helps lower cholesterol and reduce the risk of heart
disease. It also contains polyphenols and antioxidant that may combat cancer growth and
protect our body from oxidative stress. Because of its high fiber and resistant starch
content, it may increase feelings of fullness, reuse overall calorie intake and increase fat
burning, potentially leading to weight loss and reduced body fat (Julson, 2018).
The proponents believe that this product is something that will give consumers
many health benefits and great satisfaction as the Tarostillas is delicious, affordable, clean
and also enjoyable to eat. That’s why the proponents want it to be introduced to the
market, for the people are aware the health benefits that the Tarostillas may bring. The

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 objectives of the business are: (1) to provide satisfaction to the customer; (2) to be a
number one supplier of Tarostillas in CALABARZON; (3) to convince customers and be
a destination spot for the people goer; be successful despite of many competitors; and (5)
to expand the number of customers and have high sales.

Overview of the Business

Our Vision:

Tarostillas envisions being a well-known pastillas in Batangas City, at an

affordable prices but quality, delicious and organic product. To have a maximum number
of customers to give satisfaction that leads in innovation and additional flavours of
products that will be consistent and trustworthy for the satisfaction of customer; building
a friendly environment where children rather the people would love to eat.

Our Mission:

The business mission is to give a healthy and long-lasting relationship with

customers, to give them an excellence and affordable product services in a proper way. To
provide the best service we can offer with consistent taste of product. To have every
customer who comes through our doors leave impressed by Tarotillas and excited to come
back.

Business and Industry Profile

The business, Tarostillas was first established on February 22, 2021 and is located
in Balagtas, Batangas City. It is a manufacturing type wherein it will serve individuals to
come up with their wants in their own pastillas choice. The business produced new
organic flavoured pastillas that is hundred percent (100%) authentic and affordable for
everyone. It is good for everybody, whether an adult or youth because it provides fiber
and other important nutrients. Critical factors can be avoided by doing the right process
and following the procedures rightly and ensuring the best taste of the Tarostillas.

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 Market Segmentation

Upon the growing number of markets in the Philippines engaging to pastillas as a

product, the business offers Tarostillas, as a newly flavoured pastillas. Market
segmentation is given in the following:

PRODUCT TAROSTILLAS
∙ Taro
∙ Milk (condensed and powdered)
INGREDIENTS
∙ Coated with chocolate
∙ Female and male
∙ Adults and youth
DEMOGRAPHIC
∙ Others

Can be classified via online or offline within

the area.
 Public and private markets
DISTRIBUTION CHANNEL  Convenience stores
 others

Market Competitors

Pastillas de Leche

Pastillas (sometimes called pastillas de leche; or even pastillas San Miguel) are
milk-based confectionary or candies that are usually served as desserts. This sweet treat
originated from San Miguel, Bulacan, and has spread to other parts of the province, and
the country.

Business Strategy
Filipinos are known as one of the nation in the world with the sweetest of sweet-
tooth. In the Philippines, sweet treats are enjoyed throughout the day, both as snacks or

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 desserts. Tarostillas will give taste satisfaction together with giving nutrition factors for
the customer since it is organic pastillas.

In order to make Tarostillas known, plans and objectives will be put in place to
ensure that the company delivers the best quality of Tarostillas on the market. Business
owners will surely provide customers with the best quality product and be the next
favorite of many Filipinos.
Tarostillas will implement the following strategies to achieve its goal of becoming
one of the leading sweets in Batangas City:

- Create a compelling value proposition for both owners and customers

- Employee will undergo trainings to ensure that they will serve the best quality

product. - Meeting the customers satisfaction

- Provide the best service quality

In addition, for business owners to achieve their objectives and objectives, they
will have an advertisement as part of their business strategy. The owners will use the
social media since it is one of the best flat forms to easily spread information that will
help the business be known in the market in a span of time. Aside from that, since in
today’s generation, online selling is known, Tarostillas can also be order online. This will
surely be an advantage from the competitors. The owners and the Tarostillas ensure that
they will serve the best pastillas and be known not just in the city but in the whole
country.

Company Product/ Service

Pastillas are beloved soft milk candies that are a deliciously sweet heritage of the
Spanish colonial era in the Philippines. In recent years, the art of creating a pabalat or a
pastel wrapper has transformed it from a local folk tradition to mainstream art. Pastillas
wrapped in pabalat have also become common gifts during birthdays, weddings and other
occasions, as well as pasalubong among local tourists and balikbayans.
Filipinos are known as great food lovers and what a great tribute for this, a project
in Entrepreneurial Management, the proponents have prepared an idea for the food

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 industry. We Filipinos have been found to enjoy eating. Even after a heavy meal, we're
looking for something else to eat, for a limited budget, sometimes we doubt if we would
still buy something just to lessen the unlikeable tastes in our mouths primarily because of
the price. So, the proponent is selling an innovative product, a product that is popular and
has been innovated to be differentiated from other offered pastillas. This is what we call
Tarostillas. Tarostillas are made in Taro or Gabi, a tropical plant with wide green leaves.
Its roots are starchy and high in fiber and are most often compared to sweet potatoes or
yams with pleasantly purple insides. While taro pastillas are good for our body because
they are organic, they are made up of natural ingredients than other pastillas that can
cause diabetes because of their over-sweetness. The concept of this product focuses on the
wellbeing of the consumer when satisfying their needs.
Tarostillas is a milk-based food that allows us to obtain various nutrients such as
protein, calcium, vitamins A, D, E, K, and B. Various nutrients are also found in taro,
such as fiber, manganese, potassium, phosphorus, vitamin B6, C & E, copper and
magnesium. The product is a homemade dessert for health-conscious consumers. Our
product is approximately 8 grams and individually packaged for hygienic and appealing
purposes. Tarostillas, which would be more convenient to be sold to retailers in sari – sari
stores, would not require customers to go somewhere else. Unlike other desserts, a piece
of Tarostillas can suffice to reduce the saltiness, spiciness or fatness of the food left in our
taste buds. Proponents will have individuals who will market the product and some shops
to act as a distribution platform to deliver the goods to customers who want a fresh,
exclusive taste of Tarostillas.

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 Chapter II
MARKETING PLAN

Target Market
Most of the Filipinos are engage in sweets. But as of now, everyone knows and has
knowledge that health is the most important aspects. We proposed this product because it differs
from others; firstly it is made up of taro that is healthy and organic. Secondly, it will not threat
your health because of its organic ingredients and lastly the customers will benefit here. The
target market of Tarostillas is perfectly suited for those who love and enjoy eating sweets,
whether young or adult. The target residents of this product are those individuals who live in
Batangas City. Businesses who offer Taro Pastillas product in the area of Batangas City has not
been made or introduced. Tarostillas maybe a soothing comfort food because it is both nutritious
and delicious. And also, sugary foods are considered to be healthy energizers, so it can help to
stimulate their mind and body whenever they are exhausted or tired. We believed that Tarostillas
product will surely be the next favorite sweets of many Filipinos. And we plan to expand our
business in neighboring communities if this venture proves to be a success.

Demand
Exhibit 1
Average Annual Consumption

Packs
Category 1 2 3 4 5 Total
Daily 365 25 2 1 0 0 28
Weekly 52 10 18 6 2 0 36
Monthly 12 4 4 9 6 14 37
Others 0 0 0 0 0 0 0
39 24 16 8 14 101

Packs
Category 1 2 3 4 5 Total
Daily 365 9,125 1,460 1,095 0 0 11,680
Weekly 52 520 1,872 936 416 0 3,744
Monthly 12 48 96 324 288 840 1,596
Others 0 0 0 0 0 0 0
9,693 3,428 2,355 704 840 17,020

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Average Annual Consumption = Annual Consumption
= 17,020
101
= 169 packs of Tarostillas

Exhibit 2
Historical Demand

Year Population of % of Average Annual Historical Demand

Batangas City respondents Consumption
2016 334,000 95% 169 53,623,700
2017 339,000 95% 169 54,426,450
2018 344,000 95% 169 55,229,200
2019 349,000 95% 169 56,031,950
2020 355,000 95% 169 56,995,250

Exhibit 3
Projected Demand

Year x x2 y xy
2022 1 1 53,623,700 53,623,700
2023 2 4 54,426,450 108,852,900
2024 3 9 55,229,200 165,687,600
2025 4 16 56,031,950 224,127,800
2026 5 25 56,995,250 284,976,250
Total 15 55 276,306,550 837,268,250

Year A B x Projected Demand

2022 48,999,860 2,087,150 7 63,609,910
2023 48,999,860 2,087,150 8 65,697,060
2024 48,999,860 2,087,150 9 67,784,210
2025 48,999,860 2,087,150 10 69,871,360
2026 48,999,860 2,087,150 11 71,958,510

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 Formula:

a = Σy - bΣx b = nΣxy – Σx Σy
n n Σx2 – (Σx)2

Wherein:
Σx = Summation of number of years
Σy = Summation of historical demand
Σxy = Summation of the product of historical demand and the number of years
n = Number of years
Computation:
b = 5(837,268,250) – 15(276,306,550) a = 276,306,550- 2,087,150 (15)
5(55) – (15)2 5
= 41,743,000 = 244,999,300
50 5

b = 2,087,150 a = 48,999,860

Supply
Exhibit 4
Historical Supply of Related Product

Retailer 2016 2017 2018 2019 2020

JAI’s Special
Pastillas 90,565 92,380 93,795 96,250 98,900
Marky Milky
Yema Pastillas 85,160 86,730 87,300 88,930 89,500
Michael’s Pastillas 100,650 101,490 102,540 103,180 104,390
Nanay Sianang’s
Pastillas 99,465 100,510 101,890 102,620 103,540
Total 375,840 381,110 385,525 390,980 396,330

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 Exhibit 5
Projected Supply

Year x x2 y xy
2016 1 1 375,840 375,840
2017 2 4 381,110 762,220
2018 3 9 385,525 1,147,575
2019 4 16 390,980 1,563,920
2020 5 25 396,330 1,981,650
Total 15 55 1,929,785 5,831,205
Year A B x Projected Supply
2022 373,402 4,185 7 402,697
2023 373,402 4,185 8 406,882
2024 373,402 4,185 9 411,067
2025 373,402 4,185 10 415,252
2026 373,402 4,185 11 419,437

Formula:
a = Σy - bΣx b = nΣxy – Σx Σy
n n Σx2 – (Σx)2

Wherein:
Σx = Summation of number of years
Σy = Summation of historical supply
Σxy = Summation of the product of historical supply and the number of years
n = Number of years

Computation:
b = 5(5,831,205) – 15(1,929,785) a = 1,929,785- 4,185(15)
5(55) – (15)2 5
= 209,250 = 1,867,010
50 5

b = 4,185 a = 373,402

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Demand and Supply Analysis
Exhibit 6
Market Gap

Year Projected Demand Projected Supply Market Gap

2022 63,609,910 402,697 63,207,213
2023 65,697,060 406,882 65,290,178
2024 67,784,210 411,067 67,373,143
2025 69,871,360 415,252 69,456,108
2026 71,958,510 419,437 71,539,073

Market Gap = Projected Demand – Projected Supply

Exhibit 7
Market Share

Year Annual Sales Volume Market Gap Market Share

2022 63,207,213
2023 65,290,178
2024 67,373,143
2025 69,456,108
2026 71,539,073

SWOT ANALYSIS
Conducting a SWOT analysis will determine how closely our business is line up with its
growth trajectories and success benchmarks. It will helps us to build on what we do well, to
address what we are lacking, to minimize risks, and to take the greatest possible advantage of
chances for success.
The table below has shown the SWOT Analysis of Tarostillas that will help us to succeed
our goals and objectives.

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 STRENGTHS WEAKNESSES
 First Taro Pastillas in Batangas City.  do not involve technology
 The location of business is widely  small business
open and easy to go  inadequate of raw materials
 New taste and flavored Pastillas  competitors
 Affordable price, Quality and
delicious product
 Nutritious food that promotes healthy
-pastillas has more on calcium that
strength your bones.
 Good relationship with customers and
workers.
 Not easily perish – it can preserve
longer in 2 weeks

OPPURTUNITIES THREATS
 rise of competition  shortage of raw materials
 growing demand  pricing of products
 threats will be opportunities in  many competition
innovating  rising of new pastillas store
 expansion of business
 branches

Marketing Programs and Strategies

Tarostillas adhere to the 7P’s in the business.

The Seven Ps of Marketing is a relatively simple framework that can be used by any
organization or manager to plan marketing activities and a marketing strategy. It is useful
because it ensures that you look across each area together, and consider how they might be
related.
The Seven Ps started as just four: product, price, place and promotion. Over time, as
marketers became more aware, and practices and businesses changed, three more have been
added: people, processes, and physical evidence.

 Product
Taro flavored pastillas or Tarostillas will be the key product of the business. Tarostillas
are made up of natural ingredients that are good for our body because it is organic compare to

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other pastillas that can cause diabetes because of their over-sweetness. The concept of this
product focuses on the wellbeing of the consumer when satisfying their needs.

 Price
The price that you charge is important, because it will determine the profit that you make
on the product or service. It must, therefore, be greater than the cost of producing the goods or
services. However, a product is only worth what someone is prepared to pay for it, so it needs to
be priced competitively: consistent with what others are charging for similar goods and services.
Tarostillas key objectives will include strong market share, survival, and return on
investments. Achieving these aspirations will eventually allow the business to become profitable.
So, keeping these goals in mind the company will choose prices which are competitive with the
industry. Doing so will help the business stay successful with prices that are not high over
competitors which would likely turn customers away. Yet by being not immensely below the
market price, the business will still be able to receive as much possible income while remaining
competitive.
What you charge will therefore influence your customers’ expectations of your product or
service, and you need to ensure that the business will meet those expectations.

 Place
‘Place’ describes where and how your customers will buy your product or service, and
how it will reach them. The business will be located at Balagtas, Batangas City. Tarostillas
produces its own products and sell them directly to the consumer using direct chain of
distribution. On the other hand, the internet is an extremely efficient way to expand the business
to a wider range of areas; therefore, with the use of social media through its page customers can
easily place their orders. The proponents will also market their products in different social media
platform and they will look for a distributor in other regions and cities. The business will find
appropriate way to safely ship the product. Doing so will not only increase the number of
consumers that will be able to access the business but will also allow the business to determine
new strategies and opportunities. Delivery of goods bought online is very important to overall
customer satisfaction, so it should be a part of your overall strategy.

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  Promotion
Promotion is how you communicate what you do and/or sell to your customers. Promotion
includes a whole range of activities, from branding through social media activity and advertising
to sales management and special offers. It is designed to show customers why they should buy
your product or service, and should therefore focus on benefits, and not just features.
The proponents will use a special introductory offer like discounted price and internet marketing
to advertise the product. The offer will be posted on Facebook, Instagram and shopee store. The
proponents will also create a page and boost the page to reach more customers.
Perhaps the most important thing to remember is that promotion is NOT one-way. Instead, you
should see it as the way to start a conversation with your customers, and with your employees,
who also need to understand the product.

 People
People refer to the establishment's workers and salespeople, as well as those who are
responsible for the company's performance. Staffs can also contribute to a customer's
satisfaction, which is why Tarostillas' workers are well-trained to provide high-quality service.
Staff will need to be adequately trained to understand their importance, and how to deal with
customers.

 Packaging
One of the reasons why consumers are drawn to buy a product is because of its
packaging. Tarostillas are packaged in an environmentally friendly plastic tub that can also be
reused at home. Furthermore, the bottle has a mark and a logo that can be identified, and once
they see the logo, they will be reminded of Tarostillas and the product's good taste.

 Positioning
At Tarostillas, we make it a habit to think about how our customers might think about
buying our product and every customer's input is valuable. Tarostillas is produced with the
consumer's needs and desires in mind. The first is that the customer may want to try a different
dessert that is made with healthier ingredients. The company guarantees that their sweets would

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be tastier and healthier than those available on the market. On the other hand, we consider Taro
as an alternative to using pastillas as the key ingredient in this product.

Marketing Expense
Promotion is important in business; however, costs associated with promotion and
product ads to consumers are also present. The following is a list of Tarostillas' expenses:

No. Marketing Expense Costs (Php) Marketing

Budget
Percentage
1 Marketing Employees’ salary 3,000 50%

2 Social Media Marketing (Facebook, 1,500 15%

Instagram, etc.)
3 Printed Materials and Displays (Flyers, 2,300 15%
Coupons, Business Cards etc.)

4 Gift to customers (Freebies) 1,299 10%

5 Branding Development (Logo and Visual 2,000 10%

Branding)
Total 10,099 100%

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 Chapter III
OPERATIONAL PLAN

Operation Description
The operation objective of Tarostillas is to give a healthy and long-lasting relationship
with customers, achieve consistency in the products and services offered is to give them an
excellence and affordable product and services in a proper way.
Tarostillas, as a food company, aspires to have a day-to-day production for its target
customer. This section defines the physical needs of Tarostillas operations such as the production
process, physical location, equipment and many other factors that will contribute to the
organization's success. In terms of operation and production, the company adheres to the
required requirements. Tarostilla's operations provide data on inventory needs, suppliers, and the
manufacturing process. This aids in the organization of the day-to-day business of the operations
and contributes to it becoming more coordinated and customer oriented.

Plant Location
Tarostillas’ operation will take place in Batangas City. The reason behind that is that it is
more convenient since it is surrounded by different establishments and nearby supermarkets,
public markets and other groceries stores that can suffice the needed raw materials and labor. On
the other hand, having the plant location in the said area, it is easier to gain customers since it is
crowded by people. It can be a huge advantage for the business because it can allow us to talk to
our customer face-to-face to ask for their feedbacks and since people pass by, we can observe
our target customers on what they need and wants.

Location Considerations
In choosing the best location for Tarostillas, presented below are the three possible
locations, together with the factors, weights and ratings being considered.

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 Factor Weight Balagtas, Calicanto, Rizal
Batangas City Batangas City Avenue,
(Lawas) Batangas
City

Nearness to 20 8 5 5
markets

Labor Cost 5 8 8 5

Taxes 12 9 8 7

Nearness to 10 10 10 10
suppliers

Weighted Ratings

Factor Weight Balagtas, Calicanto, Rizal Avenue,

Batangas City Batangas City Batangas City
(Lawas)

Nearness to markets 20 160 100 100

Labor Cost 5 40 40 25

Taxes 12 108 96 84

Nearness to 10 100 100 100

suppliers

Sum of weighted ratings: 408 336 309

Based on the ratings above, the chosen location is at Balagtas, Batangas City.

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Cost of Location
The cost incurred in the location of Tarostillas is shown below:

Rent/ Monthly P8,000

Legal Requirements P5,000

Construction of facility P200,000

Total P213,000

Based on the ratings above, the chosen location is at Balagtas, Batangas City.

Figure 1. Plant Site

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PLANT LAYOUT
The plant layout is where the products are utilized as well as the equipment and labor.
As such, the space is utilized properly and it ensures the smooth flow of operations that increases
the productivity of employees. The plant layout of Tarostillas is indicated below:

Figure 2. Plant Layout

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MANUFACTURING PROCESS / SERVICE PROCESS
In this section, it will demonstrate the process on how the Tarostillas are made.

PROCESS FLOW CHART FOR MANUFACTURING TAROSTILLAS

Prepare all raw materials and equipment to be use.

Prepare the taro and clean it in the running water.

Grind the taro using grinding machine then cook it

within 10 minutes in low-heat until it become
gooey.

Mix the condensed, powdered milk, butter and

taro in mixing machine until it become ready to
mold.

Mold it until 1 cm thick and 3 inches long.

Put the molded pastillas in a chocolate coating

machine

Pack the coated pastillas using the packing

machine, 12 pieces per pack.

Clean the area and wash the equipment use.

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PRODUCTION SCHEDULE

PER PACK 2021 2022 2023 2024 2025 2026

Daily 500 550 600 650 700 750

Weekly 3000 3,300 3,600 3,900 4,200 4,500

Monthly 13,000 14,300 15,600 16,900 18,200 19,500

Yearly 156,000 171,600 187,200 202,800 218,400 234,000

LABOR REQUIREMENTS
The proponents of Tarostillas will serves as an owners and managers to handle the
business. These labour requirements are shown in the table below:

Number of Daily salary Monthly salary Annual salary

employees
(Php) (Php) (Php)

10 300 7,800 93,600

TOTAL 3,000 78,000 Php 936,000

25 | P a g e
 RAW MATERIALS

Name of Amount Cost per Daily cost Weekly Monthly Annual

raw required kilo/pack/ cost cost (26 Cost (312
materials for 500 lit (6 days) days) days)
packs er/gram)
Tarostillas

Taro 1 kg 80 80 480 2,080 24,960

White 3 kg 58 174 1,044 4,524 54,288

Granulated
Sugar

Condensed 1.5 L 90 90 540 2,340 28,080

Milk

Evaporated ½L 75 37.50 225 975 11,700

Milk

Chocolate 1 Gallon 499 499 2,994 12,974 155,688

Hard Shell

Butter 200 g 30 30 180 780 9,360

Skimmed 10 kg 112 1,120 6,720 29,120 349,440

Milk

Vanilla 20 ml 38 38 228 988 11,856

Extract

TOTAL Php Php 12,411 Php 53,781 Php 645,372

2,068.50

26 | P a g e
 EQUIPMENT REQUIREMENT

Name of equipment Quantity Unit Price Total Cost

Knife 2 250 500

Ladle (big) 1 170 170

Measuring Cups 1 set 350 350

Chopping board 2 85 170

Mixing Machine 1 15,000 15,000

Packing Machine 1 19,000 19,000

Peeler 2 100 200

Cooling Rack Trolley 1 7,000 7,000

Stainless Bowl 4 290 1,160

Stainless Tray 10 450 4,500

Caldero (big) 1 4,000 4,000

Strainer (big) 1 150 150

Chocolate Coating 1 85,000 85,000

Machine

Grinding Machine 1 22,000 22,000

TOTAL Php 159,200

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FURNITURE AND FIXTURES

The furniture and fixture used in the production of Tarostillas is shown below. It includes
the unit price, quantity and the total cost of each item.

Type Price/Unit (Php) Quantity Total (Php)

Long table 4,500 3 13,500

Chair (plastic) 390 12 4,680

Refrigerator 19,600 1 19,600

Gas Stove 1,119 1 1,199

Computer and Printer 20,500 1 20,500

Food Storage Container 998 1 998

TOTAL Php 60,477

TOOLS AND SUPPLIES

This section contains lists of different tools and supplies that are used in the operation of
the business. Tools included in the list below are useful in particular work.

TOOLS

Name of Tools Quantity Cost per unit Cost

Broom and dustpan 3 315 945

Wipes and Rugs 12 39 468

Dustbins 3 399 1,197

Mops 2 149 298

TOTAL Php 2,908

28 | P a g e
 SUPPLIES

Name of Quantity Cost per Monthly Annual Cost

Supplies unit/bundle Cost (26 (In peso)
(In peso) days)
(In peso)

Cellophane 30 pcs 12/unit 312 3,744

Wrapper

Plastic 1 bundle (10 pcs) 45/ bundle 16,200 194,400

Container

(360 bundles
for 1 month)

Corrugated 104 pcs 10 / pc 1,040 12,480

Boxes

Plastic gloves 1 bundle (100 pcs) 114/bundle 684 8,208

(6 bundles for 1.14/ pc

1 month)

Sticker paper 1 ream (100 pcs) 175/ream 262.50 3,150

(3 reams for
2 months)

Ink 1 set 799 799 9,588

(1 set for 1
month)

Dishwashing 1 gallon 199/unit 99.50 1,194

liquid

(1 gallon for
2 months)

Garbage bag 60 pcs 1.10/unit 66 792

Alcohol 1 gallon 499/unit 249.50 2,994

(1 gallon for
2 months)

TOTAL Php 236,550

Supplies included in the list are consumable and estimated in monthly consumption.

29 | P a g e
UTILITIES

The following are the utilities accounts and expenses in the production of the business.
Note that the following amounts are all estimated.

Name of account Monthly Cost Annual Cost

Electricity 1,800 21,600

Water bill 1,000 12,000

Internet Bill 1,600 19,200

TOTAL Php 42,000

PRODUCTION COST

Daily Weekly Monthly Annual

Number of Number of Number of Number of
Production Production Production Production

Tarostillas 500 packs 3,000 13,000 156,000

DIRECT COST

LABOR COST

Number of Daily salary Monthly salary Annual salary

employees
(Php) (Php) (Php)

10 300 7,800 93,600

Total Direct Labor 3,000 78,000 Php 936,000

Cost

30 | P a g e
 RAW MATERIALS

Name of Amount Cost per Daily cost Weekly Monthly Annual

raw required kilo/pack/ cost (6 cost (26 Cost (312
materials for 500 lit days) days) days)
packs er/gram)
Tarostillas

Taro 1 kg 80 80 480 2,080 24,960

White 3 kg 58 174 1,044 4,524 54,288

Granulated
Sugar

Condensed 1.5 L 90 90 540 2,340 28,080

Milk

Evaporated ½L 75 37.50 225 975 11,700

Milk

Chocolate 1 Gallon 499 499 2,994 12,974 155,688

Hard Shell

Butter 200 g 30 30 180 780 9,360

Skimmed 10 kg 112 1,120 6,720 29,120 349,440

Milk

Vanilla 20 ml 38 38 228 988 11,856

Extract

Total Direct Php Php 12,411 Php 53,781 Php 645,372

Raw 2,068.50
Materials

31 | P a g e
 INDIRECT COST

EQUIPMENT REQUIREMENT

Name of equipment Quantity Unit Price Total Cost

Knife 2 250 500

Ladle (big) 1 170 170

Measuring Cups 1 set 350 350

Chopping board 2 85 170

Mixing Machine 1 15,000 15,000

Packing Machine 1 19,000 19,000

Peeler 2 100 200

Cooling Rack Trolley 1 7,000 7,000

Stainless Bowl 4 290 1,160

Stainless Tray 10 450 4,500

Caldero (big) 1 4,000 4,000

Strainer (big) 1 150 150

Chocolate Coating 1 85,000 85,000

Machine

32 | P a g e
 Grinding Machine 1 22,000 22,000

Cellophane Wrapper 312 3,744

Plastic Container 16,200 194,400

Corrugated Boxes 1,040 12,480

Plastic gloves 684 8,208

Sticker paper 262.50 3,150

Ink 799 9,588

Dishwashing liquid 99.50 1,194

Garbage bag 66 792

Alcohol 249.50 2,994

Electricity 1,800 21,600

Water bill 1,000 12,000

Internet Bill 1,600 19,200

Total Indirect Cost Php 437,750

33 | P a g e
 Cost Per Total Daily Total Total Total Annual
Cost Weekly Monthly
Unit Cost (Php)
Cost Cost
(Php)
(Php)
(Php) (Php)

DIRECT 4.14 2,070 12,420 53,820 645,840

MATERIALS
USED

DIRECT 6.00 3,000 18,000 78,000 936,000

LABOR

FACTORY 2.80 1,400 8,400 36,400 436,800

OVERHEAD

TOTAL Php 12.94 Php 6,470 Php 38,820 Php Php 2,018,640
PRODUCTION 168,220
COST

34 | P a g e
 Chapter IV
ORGANIZATIONAL PLAN

This chapter contains the management which is the most important aspects of in
establishing a business. The overall implementation plan is discussed in the organization and
management study. These aspects include the objectives of the study of the organization or key
personnel, form of business ownership, capitalization, organizational structure, manpower
requirements, compensation and benefits, and legal requirements.

OBJECTIVES OF THE STUDY

The following are objectives of this study:
 To manage the capitalization and the share of each partner in the
business

 To describe the organization structure used

 To present the organizational structure of the business
 To present the requirements for manpower of the business and its job
position.
 To present the legal requirements and permits of the business
 To follow the projected time table that the entrepreneur uses as a guide and by
tracking the progress of the business.

FORMS OF THE BUSINESS OWNERSHIP

TAROSTILLAS is owned by 6 students from Batangas State University under BSBA
Department. The type of their business ownership is general partnership where there is a formal
arrangement by two or more parties to manage and operate a business and shares profit. They
have an equal share of ownership which is 16.6% each for the limited partner and 17% for the
general partner. This kind of partnership is easily formed business structure. Partnership does
not pay income tax and each partner files the profits or losses of the business on his or her own
personal income tax return.
There are 6 owners, the proponents use this as an advantage because they can help each
through their shared ideas and concept to make the business grow and successful.

35 | P a g e
CAPITALIZATION
The following are the capital invested by the partners in the business. The contribution of
each partner has given each percentage in share of distribution of profits and losses (in case) in
the business.

PARTNERSHIP CAPITAL

NAME CAPITAL PERCENTAGE

Evangelio, Tonirose D. 664,000.00 16.6%

Ferry, Shiela May P. 664,000.00 16.6%

Matira, Trishia Liegh F. 664,000.00 16.6%

Panganiban, Mary Grace S. 680,000.00 17%

Plata, Kheyzel C. 664,000.00 16.6%

Umali, Jovelyn C. 664,000.00 16.6%

TOTAL P 4,000,000.00 100%

As shown in the table, Ms. Panganiban invested P 680,000.00 in the business, obtaining 17%
of the total capital. The other investors, Ms. Evangelio, Ms. Ferry, Ms. Matira, Ms. Plata, and
Ms. Umali put an equal amount of money P 664,000.00 gaining 16.6% of the total capital of the
business.
The partners' total investment in the business is P 4,000,000.00, which is sufficient to create
and purchase all materials needed for the construction and operation of the business in Barangay
Balagtas, Batangas City.

36 | P a g e
MANPOWER REQUIREMENTS

Hiring good employees will make the business effective. In order to find competent,
efficient, hardworking and most of all, trustworthy employees.
Each employee applicant must submit the following requirements:

1. 2 pieces of 1x1 picture (white background)

2. 2 pieces of 2x2 picture (white background)

3. Barangay Clearance

4. PSA certificate

5. SSS number

6. Phil health

7. Medical exam

8. NBI clearance

9. TIN number

10. Diploma/Certificate (at least Senior high school graduate)

11. Credentials

All requirements should be submitted in photocopy and place it in a long envelope.

37 | P a g e
 GENERAL MANAGER

FINANCE MANAGER FINANCE STAFF

ACCOUNTING ACCOUNTING STAFF

MANAGER

HUMAN RESOURCE
MANAGER HR STAFF

MARKETING MANAGER MARKETING STAFF

PRODUCTION ASSISTANT
MANAGER PRODUCTION
MANAGER

PRODUCTION STAFF

38 | P a g e
Qualification Standards

POSITION JOB DESCRIPTION JOB SPECIFICATION

General  Increase management’s  Business related graduate

Manager effectiveness by recruiting,  At least 6 months of job
selecting, orienting, training experience
and coaching, counselling,  Must be 23-30 years old
communicating values,
strategies and objectives,
assigning accountabilities,
planning, monitoring, and
appraising result.

Financial  Providing financial reports  Proven experience as a

Manager and interpreting financial financial manager
information to managerial  Able to manage, guide and
staff while recommending lead employees to ensure
further courses of action appropriate financial
 Advising on investment processes are being used
activities and provide  A solid understanding of
strategies that the company financial statistics and
should take accounting principles
 Maintaining the financial  BS/MA Degree in finance,
health of the organization accounting or economics
 Professional qualifications
such as CFA/CPA or
similar will be considered
a plus

Financial Staff  Assisting in preparation of  Degree on accounting and

budgets Managing records finance
and receipt  Excellent knowledge of MS
 Reconciling daily, monthly  Excel and accounting software
and yearly transactions  Good organizational skills
 Resolve financial disputes  Strong analytical skills
raised by the customer  Strong knowledge of
service and sales teams bookkeeping
 Being a key point of contact
for other departments on

39 | P a g e
 financial and accounting
matters

Accounting • Managing and overseeing the • Bachelor degree in accounting

Manager daily operation of the finance or related field
accounting department • Experience in management,
• Monitoring and analysing accounting, or a related field
accounting data and produce maybe prepared
financial reports or • Strong understanding of
statements accounting, finance and
• Establishing and enforcing management principles
proper accounting methods,
policies and principles

Accounting • Prepared general ledger, • Bachelor degree in accounting

Staff entries by maintain records or finance required
and files; reconciling • At-least 2 years’ experience in
accounts accounting or a related field
• Prepares payments by • Proficient in MS Word and
accruing expenses; Excel
assigning account numbers, • Strong understanding of
requesting disbursement; Philippine tax regulations
reconciling accounts

Human • Plan and coordinate the • Proven working experience as a

Resource workforce to best use HR manger or other HR
Manager employees’ talents executive
• Resolve issues between • In-depth knowledge of labor
management and employees law and HR best practices
• Coordinate and supervise the • Degree in Human Resources or
work of specialist and staff related field
• Oversee recruitment and
hiring process

Human • Assist with day to day • Proven experience as an HR

Resource Staff operations of the HR assistant, staff assistant or
functions and duties relevant human resources/
• Provide clerical and administrative position
administrative support to • Fast computer typing skills •
HR executives Hands-on experience with an
• Properly handle complaints HRIS or HRMS
and grievance procedures • Strong communication skills

40 | P a g e
 • Degree in Human Resources or
related field

Marketing • Responsible for managing the • Bachelor’s degree in

Manager company’s marketing marketing, business or a
initiatives. related field, marketing
• Uses market research and strategy, and public speaking
analysis to direct marketing • Interpersonal
strategy and planning. • Communication, leadership,
• Oversees the production of all people management, detailed
promotional materials and – orientated, budgeting,
marketing campaigns. organization and multi-
• Reports marketing and sales tasking
results to senior executives

Marketing • Responsible for managing the • Business related graduate

Staff company’s marketing • Must be 25-35 years old
initiatives. • With experience
• Uses market research and
analysis direct marketing
strategy and planning.

Production • Plan and draw up production • Proven experience as

Manager schedule production director
• Select equipment and take • Deep knowledge of production
responsibility for its management
maintenance • Understanding of quality
• Set the quality standards standards and health & safety
• Ensure that the production regulations
will be cost effective by • Excellent organizational and
estimating cost and leaderships skills
negotiating and agreeing • Strong decision-making skills
budgets with both clients and a results-driven approach
and managers BA in business administration
• Review worker performance or relevant field
and identify training needs

Assistant • Reporting to the production • Bachelor’s or associate degree,

Production manager with course work in
Manager • Assisting the production production management,
• Appointing labor and operations management or
purchasing stock toward the similar

41 | P a g e
 smooth running of the • Ability to confidently and
production process proactively supervise
• Preparing cost estimates for production teams
materials, equipment, and • Knowledge of procuring
hiring laborers materials, equipment, and
labor needed throughout the
production process

Production • Assembling products and • Previous experience working in

Staffs parts a factory is beneficial
• Maintaining a clean • Experience operating
workstation and production manufacturing machinery
floor • Previous experience working in
• Finalizing and packaging a factory beneficial
products for shipment • Available for shift work
• Monitoring the assembly line
and removing faulty
products

COMPENSATION AND BENEFITS

EMPLOYEES SOCIAL HEALTH BONUSES AND

INSURANCE BENEFITS 13TH MONTH PAY
PROGRAM

FINANCIAL STAFF Php 500.00/month Php 300.00/month Php 10,000.00/month

ACCOUNTING Php 500.00/month Php 300.00/month Php 10,000.00/month

STAFF

HR STAFF Php 500.00/month Php 300.00/month Php 10,000.00/month

MARKETING Php 500.00/month Php 300.00/month Php 10,000.00/month

STAFF

ASSISTANT Php 500.00/month Php 300.00/month Php 10,000.00/month

PRODUCTION Php 400.00/month Php 300.00/month Php 8,000.00/month

STAFF

42 | P a g e
 BUSINESS OWNERS

PERSONNEL JOB DEDUCTIONS TOTAL ANNUAL

POSITION MONTHLY COMPENSATION
SALARY

Ms. Mary General SSS- Php Php 35,426.50 Php 425,118.00

Grace Maanger 336.00
Panganiban
PhilHealth-Php
137.50
Pag–Ibig -Php
100.00

Ms. Tonirose Financial SSS- Php Php 29,426.50 Php 353,118.00

Evangelio Manager 336.00
PhilHealth-Php
137.50
Pag–Ibig -Php
100.00

Ms. Jovelyn Accounting SSS- Php Php 29,426.50 Php 353,118.00

Umali Manager 336.00
PhilHealth-Php
137.50
Pag–Ibig -Php
100.00

Ms. Trishia Human SSS- Php Php 29,426.50 Php 353,118.00

Leigh Matira Resource 336.00
Manager
PhilHealth-Php
137.50
Pag–Ibig -Php
100.00

43 | P a g e
 Ms. Shiela Marketing SSS- Php Php 29,426.50 Php 353,118.00
May Ferry Manager 336.00
PhilHealth-Php
137.50
Pag–Ibig -Php
100.00

Ms. Kheyzel Production SSS- Php Php 29,426.50 Php 353,118.00

Plata Manager
336.00
PhilHealth-Php
137.50
Pag–Ibig -Php
100.00

Benefits
A. Insurance Retirement “Tarostillas” provides a benefit package to all full-time
employees which include:
(1) Individual or Family Health Insurance
(2) Short and Long Term Disability
(3) 403b – retirement
(4) Life Insurance
B. Personal Sick Leave
Personal sick leave will be accumulated as follows: 5 days at one year of service,
8 days at three years of service, and 10 days at 5 years of service. Any unused sick leave
will be forfeited at year’s end. All accumulated sick time is also forfeited upon
termination of employment for any reason
C. Leave of Absence
Employees may request an unpaid leave of absence that must be submitted in
writing to the HR.

44 | P a g e
 D. Vacation
Vacation will be accumulated as follows: 2 weeks’ vacation during the first year
after 6 months of employment, 3 weeks per year after five years of service, and 5 weeks
per year after eight years of service. Vacation time can be taken at any time with
approval of an HR. Employees may accumulate up to 30 days of vacation time.
Employees will be paid for accumulated vacation time at termination of employment.

E. Holidays

The following paid holidays will be observed:

1) New Year’s Day
2) Labor Day
3) Independence Day
4) Christmas Day

F. Travel and Other Expenses

Employees will be reimbursed for travel and expenses provided the trip is pre-
approved by the HR. Employees using personal automobiles for travel will be
reimbursed at the current approved rate. All requests for mileage reimbursement will be
documented on the approved mileage reimbursement form.

45 | P a g e
 LEGAL REQUIREMENTS OF TAROSTILLAS: PERMITS AND CERTIFICATIONS

MAYOR’S BUSINESS PERMIT

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 DTI PERMIT

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 BUILDING PERMIT

48 | P a g e
 SANITARY PERMIT

49 | P a g e
 OCCUPANCY APPLICATION FORM

50 | P a g e
 CHAPTER V
FINANCIAL PLAN
This chapter discusses the financial elements of acquiring the various equipment,
resources and materials needed to achieve the company’s goals, as well as the timescales
involved. It covers every area of the business; including overall project costs, funding resources,
financial assumptions, financial statements, and break even analysis.

I. TOTAL PROJECT COST

The total amount of money required to complete a project or piece of work is referred to
as the “total project cost”, which includes both direct and indirect costs. The project costs are any
expenditures made or estimated to be made, or monetary obligations include or estimated to be
incurred, to complete the project that are listed in the project baseline (ThePD, 2015). This
section covers the initial cost and assets of Tarostillas. The goal of this account is to maximize
financial expenditures by carefully adjusting and monitoring individual expenses to ensure that
capital is used properly.

TOTAL PROJECT COST

(1 MONTH)

Fixed Assets

Office Equipment and Furniture 63, 385.00

Factory Equipment and Furniture’s 18,200.00

Total 81,585.00

Working Capital for One Month

Direct Materials 53,820.00

51 | P a g e
 Direct Labor 78,000.00

Factory Overhead

Indirect Materials 25,992.00

Utilities Expense – Factory 2,800.00

Supplies – Factory 19,712.50

SSS, Philhealth & Pag-ibig Contributions 57,350.00

105,854.50

Total 237,674.50

Administrative Expenses

Utilities Expense Office 1,600.00

Administrators' Salary 182,559.00

SSS, Philhealth & Pag-ibig Contributions 3,441.00

Supplies – Office 1,214.00

Total 188,814.00

Selling Expense

Delivery Expense 2,400.00

Advertising Expense 10,000.00

Total 12,400.00

Grand Total 520,473.50

Cash on Hand 3,479,526.50

Total Project Costs 4,000,000.00

52 | P a g e
II. SOURCES OF FINANCING

Due to the changing working environment in today’s worldwide competitive market,

different organizations are always looking for new kinds of financing in order to expand and
develop. Tarostillas’ primary source of financing would be personal investment from its six
partners. The general partner contributes 17% and the rest shares 16.6%. Furthermore, due to the
additional money available for the endeavour, the six partners feel that the business will be
straightforward to setup and have minimal start-up cost. There’s a good chance that the
company’s revenues and expenses will be divided, which is beneficial because it saves money on
taxes. Moreover, the Tarostillas would be a success with the effort of each other.

III. FINANCIAL ASSUMPTION

Any business plan needs to include financial assumptions. This contains revenues and
loss predictions, as well as inventories and accounts receivables on a balance sheet. Balance
sheet assumption should be practical and based on actual asset acquisition forecasts for the
following five years. To summarize, this would assist in the development of the cash flow
statement’s conclusion. Furthermore, financial assumptions are also important for understanding
the flow of business operations and quickly incorporating what it would take to create that level
of income and production.

FINANCIAL
ASSUMPTION

PRODUCTION:

The business would start operations on 2021

The average inflation rate is 3%

The business would operate in 312 days

53 | P a g e
 Production is expected to increase by 10% every year due
following the
learning
curve theory

Units to be produced on the first 156,000 units

year would

be

The volume of purchases would

increase proportionately with the
increase in theproduction

Direct and indirect materials would 100% cash

be purchased

Every year end, 100% Cash

The FIFO method would be used in

valuing the inventory

Finished goods ending inventory would be 1% Of the goods

produced

for the year

There would be 10 workers

Labor rate for the workers would be 300 per day

54 | P a g e
 Labor rate is expected to increase due 3% rate

to inflation at

Allowance for spoilage would be 0.05% Of units to be

produced

SALES:

Selling price to retailers would be 30% Above cost

Selling price to by retailers to 10% Above cost

consumers would be

Cash sales would be 100% of gross sales

Provision for doubtful account would be 2% of the

outstanding
receivable for
the
current year

There would be no write off of receivables

Sales returns and allowances would be 1% of gross sales

55 | P a g e
 Selling and Administrative Expenses

Advertising expense is estimated to 90% per year

decrease

by

All expenses are expected to increase by 3% Based on the

averageinflation
rate except
expenses for
depreciation, rent
and
doubtful accounts.

There would be no withholding taxes.

Utilities expense would be allocated 80% to factory and 20% to office

Utilities Expense is expected to increase 3% rate

due to inflation at

Maintenance expense would be allocated 70% to factory 30% to office

Maintenance Expense is expected 3% rate

to increase due to inflation at

56 | P a g e
 Thirteenth month pay will be given to
the workers base on their monthly
salary

Fees and Licenses are based on the

assessment given by the Office of
the CityTreasurer

A Plant Expansion Fund would be 0% of the ending

established that would require balance
annual ofcash
allocation of

Partnership Agreement:

There would be 6 partners

The partners will contribute 680,000 each to start the 4,000,00

– 0
business, a total
General of
Partner

664,000
.00 –
Remaining

Net income or loss is shared equally

amongthe partners after deducting the
salaries tobe given the managing
partner in accordance with the
agreement of the partners as

57 | P a g e
 stipulated in the contract

The managing partner is entitled 425,118 That would be Partner 1

to a salary .00

allowance of

The sales representative is entitled 10,000

to a monthly salary of

The owner are allowed to withdraw 20% from their

total share in

the income

IV. FINANCIAL STATEMENT

According to Chris Murphy (2020), financial statement is written records that convey the
business activities and the financial performance of a company. Financial statement are often
audited by government agencies, accountants, firms, etc. to ensure accuracy and for tax,
financing or investing purposes. It discusses the company’s financial and operational
performance. The balance sheet, income statement and statement of cash flows are the three most
important financial statement reports for tracking a company’s success.
Tarostillas believes that evaluating and examining financial accounts on a regular basis is
critical to completely comprehending the business’ position. These are important since they
indicate the company’s success and financial standing. Moreover, it helps business owners
evaluate and make proper business decisions by comparing past and present outcomes, and so
anticipating the company’s future performance and advancement. It also identifies which
elements of the firm offer the best return on investment.

58 | P a g e
A. Balance Sheet
According to Susan Ward (2020), the balance sheet is the most essential of the three
financial statements used to show a company’s financial health. A balance sheet aids business
stakeholders and analysts in assessing a company’s overall financial position and capacity to
meet its operational expenses. The balance sheet can also be used to figure out how to meet your
financial obligation and the best ways to finance your activities with loan.

A balance sheet is use to indicate what a firm brings and owes to interested parties as
well as to notify them of its financial situation. Understanding how to utilize, comprehend and
comprehend the balance sheet is critical for all business owners. This can also provide
information or reasons for investing in the business.

59 | P a g e
 BALANCE SHEET

2021 to 2025

2021 2022 2023 2024 2025

ASSETS

Currents
Assets

Cash 3,123,456. 3, 456,789.00 3,800,750.00 4,250,567.00 4,780,980.

00 00

Accounts 38,992.0 47,556.00 55,365.00 63,123.00 71,459.00

Receivable 0
Net

Inventory 16,897.0 24,370.50 30,365.75 37,430.25 45,671.00

0

Total Current 3,179,345. 3,528,715.50 3,886,480.75 4,351,120.25 4,898,110.

00 0
Assets
0

Non-Current

Assets

60 | P a g e
 Property, 513,348.0 455,890.00 326,379.00 201,190.00 -
0
Plant and
Equipment

Plant - - - - -
Expansion
Fund

Total 513,348.0 455,890.00 326,379.00 201,190.00 -

0
Non-Current
Assets

TOTAL 3,692,690. 3,984,605.50 4,212,859.75 4,552,310.25 4,898,110.0

00 0
ASSETS

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LIABILITIE
S&
OWNERS
EQUITY

Current - - - - -

Liabilities

Accounts - - - - -

Payable

Vat Payable 5,740.93 18,676.53 32,120.45 46,116.89 60,678.16

Total 5,740.93 18,676.53 32,120.45 46,116.89 60,678.16

Current

Liabilities

Owner's

Equity

Capital 4,162,011.20 4,381,603.59 4,674,743.20 5,055,588.08 5,538,542.84

Total 4,162,011.20 4,381,603.59 4,674,743.20 5,055,588.08 5,538,542.84

Owner’s
Equity

TOTAL 4,167,752.13 4,400,280.12 4,706,863.65 5,101,704.97 5,599,221.00

LIABILITIE
S
& EQUITY

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 PROJECTED STATEMENT OF CHANGES IN OWNER'S EQUITY

2021 TO 2025

2021 2022 2023 2024 2025

Capita 4,000,000.00 4,162,011.2 4,381,603.59 4,674,743.20 5,055,588.08

balance
Beginni
ng

Add: Share 202,514.00 274,490.49 366,424.51 476,056.10 603,693.43

in Operatin
g Income

Less: (40,502.80) (54,898.10) (73,284.90) (95,211.22) (120,738.67)

Withdrawal

Capital 4,162,011.20 4,381,603.5 4,674,743.20 5,055,588.08 5,538,542.84

9
Balance, End

B. INCOME STATEMENT
Since it incorporates revenue, detailed financial information, and sales and spending
classification, the income statement is one of the most important financial statements. Revenue,
expenses or costs, gains and losses are the four main components. The income statement is
critical because it shows whether or not a company is profitable. To be considered a successful
enterprise, a company must consistently produce a profit over time. This information can only be
found in the income statement.
Firms should generate an income statement on a regular basis in order to determine if
they are profitable or not. This examines a company’s efficiency in converting costs in to profits.
“Tarostillas” proponents must study and track the income statement in order to determine if the
company can generate profits in the long run and make crucial business decisions. The estimated
income statement for Tarostillas is as follows:

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 PROJECTED INCOME STATEMENT

2021 TO 2025

Particulars 2021 2022 2023 2024 2025

Net Sales 2,422,368.0 2,906,841.6 3,488,209.9 4,185,851.9 5,023,022.2

0 0 2 0 8

Less: Cost 2,018,640.0 2,422,368.0 2,906,841.6 3,488,209.9 4,185,851.9

0 0 0 2 0
of Goods

Sold

Gross Profit 403,728.00 484,473.60 581,368.32 697,641.98 837,170.38

Less:
Operating
Expense

Selling 12,400.00 13,268.35 14,365.05 14,987.53 15,645.00

Expense

Administra 188,814.00 196,714.76 200,578.76 206,598.35 217,831.95

tive
Expense

Total 201,214.00 209,983.11 214,943.81 221,585.88 233,476.95

Operating
Expenses

Net Income 202,514.00 274,490.49 366,424.51 476,056.10 603,693.43

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C. STATEMENT OF CASH FLOW

A cash flow analysis will aid a company in gaining a more complete understanding of its
cash flow and circulation. The cash flow statement is a financial statement that shows how a
company’s cash inflows and outflows have changed overtime. The use of cash flow statement
informs a corporation if revenues are insufficient to cover expenditures.
The Cash Flow Statement is a financial statement that shows how a company spends its
money. It’s frequently referred to us the “third facet” of a business’s financial statements. It is
used to identify a firm’s financial position, such as the inflow and outflow of cash and cash
equivalents during a given time period, and it also allows the company to determine its cash
availability. The cash flow analysis is crucial since it offers information about the company’s
cash situation.
Tarostillas would rely on the cash flow statement to determine whether it has enough
cash to continue operations. A company’s ability to stay solvent depends on having cash on
hand. The company claims that when a company’s cash flow is insufficient to satisfy its
obligations, it is frequently referred to us bankrupt.

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 PROJECTED STATEMENT OF CASH FLOWS

2017 TO 2021

2017 2018 2019 2020 2021

Cash Flow from

Operating
Activities

Annual Cash 202,514.00 274,490.49 366,424.51 476,056.10 603,693.43

Return (Net
Income +Dep.)

Add (Less)

Increase in (38,992.00) (8,564.00) (7,809.00) (7,758.00) (8,336.00)

Accounts
Receivable

Increase in (16,897.00) (7,473.50) (5,995.25) (7,064.50) (8,240.75)

Inventory

Increase in - - - - -

Accounts
Payable

Increase in VAT 5,740.93 12,935.60 13,443.92 13,996.44 14,561.27

Payable

Net Cash Flow 152,365.93 271,388.59 366,064.18 475,230.04 601,677.95

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 Cash Flow from - - - - -
Investing Activity

Acquisition of 81,585.00
Fixed Asset

Net Cash Used (81,585.00) - - - -

Cash Flow from

Financing

Initial 4,000,000.00

Investment

Withdrawal (40,502.80) (54,898.10) (73,284.90) (95,211.22) (120,738.67)

Net Cash 3,959,497.20 (54,898.10) (73,284.90) (95,211.22) (120,738.67)

Provided

Net Increase in 4,030,278.13 216,490.49 292,779.28 380,018.82 480,939.28

Cash

Cash Balance Beg. - 4,030,278.13 4,246,768.62 4,539,547.90 4,919,566.72

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 Cash Balance 4,030,278.13 4,246,768.62 4,539,547.90 4,919,566.72 5,400,506.00

Ending

Cash Allocated - - - - -

to Plant
Expansion Fund

Cash, 4,030,278.13 4,246,768.62 4,539,547.90 4,919,566.72 5,400,506.00

Unrestricted for
use

V. BREAK-EVEN ANALYSIS

Break-even analysis entails determining and quantifying an entity’s margin of safety in

relation to its collected revenue and associated costs. To put it another way, the research shows
how many earnings are required to cover the cost of conducting company. Using the break-even
analysis Tarostillas would be able to determine the amount of units to sell and sales volume
needed to cover all expenditures before generating revenue.

TABLE 1

BREAK-EVEN VOLUME ANALYSIS

Year Fixed Cost Cont. Margin/ Break Even Point

Unit

2021 341.735.00 14.52 23,535

2022 351,987.05 13.53 26,015

2023 362,546.67 12.60 28,774

2024 373,423.07 11.71 31,889

2025 384,625.76 10.88 35,352

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 This represents how many units should be provided to avoid losses; there seems to be a
substantial gap between this and actual product purchases, showing that the risks of a loss are
low.

TABLE 2

BREAK-EVEN SALES ANALYSIS

Year Fixed Cost Cont. Margin % Break Even Point

2021 341.735.00 93.49% 365,531.07

2022 351,987.05 94.41% 372,828.14

2023 362,546.67 95.20% 380,826.33

2024 373,423.07 95.88% 389,469.20

2025 384,625.76 96.46% 398,741.20

This illustrates how revenues can be made to minimize losses; there is considerable gap
between the predicted and actual revenue, showing that the risk of losing money is low.

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 TABLE 3

BREAK-EVEN SELLING PRICE PER UNIT

Year Fixed Cost per Cont. Margin % Break Even Point

Unit

2020 2.19 93.49% 2.34

2021 1.74 94.41% 1.84

2022 1.38 95.20% 1.44

2023 1.09 95.88% 1.14

2024 0.86 96.46% 0.89

The company’s ability to lower expenses while retaining a profit margin is evidenced by
the lowering trend in the BEP sale price. This means that the company will be lucrative enough
in the coming years to adjust to the changing environment.

TABLE 4
MARGIN OF SAFETY

Year Budgeted Sales Break Even Sales Margin of Safety

2020 2,422,368.00 365,531.07 2,056,836.93

2021 2,906,841.60 372,828.14 2,534,013.46

2022 3,488,209.92 380,826.33 3,107,383.59

2023 4,185,851.90 389,469.20 3,796,382.70

2024 5,023,022.08 398,741.20 4,624,281.08

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 Even though budgeted revenue is far larger than Margin of Safety sales, an advantageous
and increasing margin of safety indicates that the company is unlikely to lose money.

TABLE 5
MARGIN OF SAFETY RATIO

Year Margin of safety Budgeted Sales MOS Ratio

2020 2,056,836.93 2,422,368.00 84.91%

2021 2,534,013.46 2,906,841.60 87.17%

2022 3,107,383.59 3,488,209.92 89.08%

2023 3,796,382.70 4,185,851.90 90.70%

2024 4,624,281.08 5,023,022.08 92.06%

Even though budgeted profits are far larger than Margin of Safety sales, a rising Margin
of Safety Ratio shows that the organization is unlikely to lose money.

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 TABLE 6
OPERATING LEVERAGE

Year Contribution Net operating Operating

Leverage
Margin Income

2020 2,264,556.00 202,514.00 11.18

2021 2,744,295.24 274,490.49 10.00

2022 3,320,787.17 366,424.51 9.06

2023 4,013,406.47 476,056.10 8.43

2024 4,845,403.49 603,693.43 8.03

A lower operating leverage suggest that the company this attaining enough contribution
margins are successfully managing fixed expenses, leading in a narrower gap between
contribution margin and final profits.

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 Chapter VI

SOCIO-ECONOMIC CONTRIBUTION

Contribution to the Philippine Economy

In terms of the social and economic activities that Tarostillas will participate in, the company
follows government guidelines. In dealing with the current economic downturn, it represents not just the
owner’s needs, but also the community’s. In general, this project will aid in the development of the
region. The company was founded not only for profit, but also to address the challenges of social
resurgence. The company was founded not only to make money, but also to meet the challenges of social
responsibility by providing people with socioeconomic opportunities.

Furthermore, this economic venture will have a calming influence on society because it will offer
jobs for the people. The partnership’s strategy for attaining its aims, which are to create simple jobs and
contribute to the Philippine economy, is to develop and provide a new product to the market. The jobs
created by the company would help to alleviate the country’s unemployment. The company’s positions
would serve to reduce the country’s unemployment problems while simultaneously improving the living
conditions of people who would be hired. Additionally, the findings of this research will assist
government planners in taking a closer look at this field and its possibilities for generating money that
will benefit the economy in terms of job creation and timely tax payments. Farmers in Batangas and
adjacent towns may benefit from the enterprise as a ready market for their products. It will also offer
customers a healthier alternative. Tarostillas can, however, help our economy in many ways.

Employing Local Workers

Tarostillas will contribute to local economies by bringing development and innovation to the
region where the company is based. It can also help to boost economic growth by creating employment
opportunities for those who would otherwise be unemployed by larger corporations. People who make
new products or discover new ways to implement old ones are drawn to this industry. Many larger
companies outsource different business services to businesses like Tarostillas in the same local region, so
they can benefit from businesses.

Adapting to Changing Climates

Tarostillas may also be able to adjust to changing economic conditions easily. This is due to the
fact that these companies are often customer-focused and aware of the needs of the community. Many

73 | P a g e
local consumers remain loyal to their favorite’s business despite the downturn in the economy. Businesses
like Tarostillas are able to remain alive through tough times as a result of this commitment, which helps
to improve local economies. Moreover, Tarostillas produces less revenue than larger companies, meaning
that we stand to suffer less in the event of a downturn.

Contributing to Local Government Taxes

People who shop at Tarostillas are supporting business in their community. This is essentially
reinvesting in the near neighborhood. A good local business generates a lot of income, which means it
pays a lot of taxes, including local property taxes. This money is then allocated to local police and fire
departments, charities, churches as well as schools. Aside from that, Tarostillas will raise property values
in a city, benefiting any home owner while increasing property tax revenue for local governments.

Via sales tax collection, the Tarostillas company can have an effect on the local economy. Local
business will serve as the backbone of special taxing districts focusing on unique programs such as
lighting and side walk improvements to revive historic commercial district and draw more customers by
charging sales tax based on their location.

Employment Generation

We Filipinos are in a state of distress and poverty as a result of the pandemic. This pandemic will
cost the government a lot of money. Many businesses have gone bankrupt, and a result, the
unemployment rate continuous to rise. What are society is going through right now is extremely difficult,
especially for the people. Poverty is on the rise as a result of a lack of necessities. Tarostillas is a pastilllas
that contains vitamins and minerals.

Tarostillas has only ten direct employees, all of whom we believe are qualified for the position.
And because Tarostillas accepts wholesalers, these indirect employees who want to contribute to the
growth of our company will generate chances for those in need of work as well as those who are truly
passionate of this industry. Tarostillas will help to enhance job growth and reduce the rate of
unemployment in our country. As our business grows, it will provide many chances for people since, as
we all know, the larger the business expands, the more individuals are required to share new ideas and
tactics in order for the business continue to succeed.

Social Desirability

The primary aim of this proposed business plan is to assess the feasibility of the proposed plan to
open a business in Batangas City that will serve customers from the surrounding areas and surrounding
cities. Feature of this proposed business strategy is to be able to acknowledge the advantages that can be

74 | P a g e
achieved from this proposal’s project in terms of its contribution to consumers, other business, and overall
economy.

Benefits to customers, other firms and economy

Tarostillas can help every customer to have a healthy body. Also, the proponents ensured that
every pastillas that customers consume is full of nutrition and will surely satisfy them. For the business
firms, this proposed project will not just help the business itself, but it will also benefit the other firms
since they are going to supply the primary ingredients of the said product. For instance, the main
ingredient of Tarostillas is taro, the proponents can help the farmers since we are going to buy bulk of
orders from their business that will help them increase their sales. And lastly, it will benefit the economy
in the way that the company will going to pay taxes to the government. It will help to increase the tax
income that will contribute in improving public services in the country.

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 BIBLIOGRAPHY
Julson, E. (2018). 7 Surprising Benefits of Taro Root. Retrieved from:
https://www.healthline.com/nutrition/tarorootbenefits?fbclid=IwAR0eeBqisMG85T8zl_LYWdz
n3lwQtcH-JI7wGnoXoLFp9ixNjudlAn5ntC8

Murphy, C. (2020). Financial Statements. Retrieved from:

https://www.investopedia.com/terms/f/financial-statements.asp

Pastillas de Leche: The Little Sweet Surprise from Bulacan. November 11, 2020. Retrieved
from: https://www.bulakenyo.ph/pastillas-the-little-sweet-surprise-
frombulacan/?fbclid=IwAR1shst7UlN5UKhpZwrOe1QU8Lu1iEO1ytEz60ui0I6oe_Q0mablzqyq
8fw

ThePD (2015). Project Cost. Retrieved from: https://www.theprojectdefenition.com/project-cost/

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