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FEASIBILITY STUDY ON REJUVENATING SET PRODUCTION

ALLIAH G. GALLENTES
ROSE MAE L. TABALANZA
APRIL JOY B. PARAN
RALPH OGIE BON C. VILAR
RONEL JAY E. COSTALES

AN UNDERGRADUATE FEASIBILITY STUDY SUBMITTED TO THE FACULTY

OF THE COLLEGE OF BUSINESS AND ACCOUNTANCY, SOUTHERN
CHRISTIAN COLLEGE, MIDSAYAP COTABATO, IN PARTIAL
FULFILLMENT OF THE REQUIREMENTS
FOR THE DEGREE

BACHELOR OF SCIENCE IN BUSINESS ADMINISTRATION

MARKETING MANAGEMENT

MAY 2022
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PROJECT SUMMARY

The project summary contains the name of the business, description of the

business, location of the business, mode of financing, and major assumptions. It also

represents the general conclusion of different aspects, including the market, technical,

management, and financial aspects of the study.

Name of the Business

The name of the business is Organic Glow Rejuvenating Set Production. Its name

is taken from the product itself. The word organic is a term that describes its natural

ingredients, and glow is where it will give radiant and rejuvenate skin. Through its name,

the customers can easily recognize the type of product. The business name also reflects

the product's identity that the business will produce for its customers.

Description of the Business

Organic Glow rejuvenating set production is a manufacturing business that

produces skincare that belongs to the cosmetic industry. The business will produce

rejuvenating set and will manage by one person. The business will be the producer of

skincare products in the Municipality of Midsayap, which is the business's target market.

The business can attract its customers because the owner will ensure that the product

produced is safe, effective, and FDA-approved.

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Location of the Business

The business will be located in Kimagango, Midsayap, and Cotabato (Appendix

A). The business has an advantage in its location because it is away from the residents to

avoid harm, especially the smoke coming from the factory. There is no difficulty

acquiring raw materials because they are also easy to locate.

Mode of Financing

The owner will finance the initial investment of 300,000 that can use to start the

business, and it will come from personal savings. The total cash investment will be used

to purchase equipment, furniture and fixtures, supplies, and the business's working

capital, such as raw materials, utilities, and labor costs.

Highlights of Major Assumption

The assumptions serve as a guide to evaluating the business operation. It will

analyze the market, technical, management, and financial aspects of the study.

1. The useful life of the building is 30 years, five years for equipment, 3 to 5 years

for the tools, and five years for the furniture and fixtures. All depreciable assets

will have no salvage value.

2. The business will take an average of 25.4% in the market share. The business can

produce rejuvenating sets according to the projected demand every year.

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3. Based on the inflation rate, the cost will increase at 3.0% for five years (PSA,

2021).

4. There will be an ending inventory at the end of the year.

Industry Analysis

Out of five forces of Michael Porter, the proponents will use the industry

rivalry of competitors as a strength because there are no local producers of

rejuvenating set in Midsayap. The weakness in the study is the bargaining power

of suppliers, which refers to the pressure that suppliers can put on companies by

raising their prices, lowering their quality, or reducing the availability of their

products. Proponents will offer an organic, affordable, and good quality

rejuvenating set to make it an opportunity.

Competitor Analysis

The proponents used a benchmarking analysis, a simple tool that

determines products or services' capabilities, especially in comparison to the

products or services of leading competitors. Organic Glow Rejuvenating Set will

be benchmarked in Skin Perfection Rejuvenating Set and Biocrown Cosmetic

Company.

Customer Analysis

The proponents will use 5W's and H to analyze customers' needs and

determine which group of people, based on their characteristics, satisfies the

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product in the market. The questionnaire must be prepared to capture the desired

information about the customers, their financial capacity, willingness to buy,

buying behavior, and other related information necessary for analysis.

Market Study Conclusion

There is no local producer of rejuvenating sets in the PALMA area.

However, the demand is relatively increasing, which is favorable to the business.

Technical Study Conclusion

The business is feasible under the technical aspect. The equipment and

machinery that are needed for the production are available in the country and the

local market. The supplies required in production can be purchased locally, and

there is clear, detailed, and sufficient information about the manufacturing

process. Additionally, there are suppliers of raw materials in the local area, such

as pharmacies and drugstores.

Management Study Conclusion

Organic Glow manufacturing has an appropriate type of organization, and

the business is small scale making it easy to manage. It has an organized schedule

established for efficient planning of the business. The salaries that will be given to

the workers are equitable, and each worker's job description is clearly defined.

Based on these results, the study is feasible under the management aspect.
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Financial Study Conclusion

The financial aspect of the business is feasible. Based on the statement of

comprehensive income, the business will incur again every year due to the

increased profit and annual production. The owner’s asset is increasing every year

based on the statement of financial position.

Socio-Economic Study Conclusion

Organic Glow manufacturing is feasible in socio-economic aspects. The

business can fulfill its responsibility to the government and society. It can

contribute to the growth of the economy for the community. The business can also

provide opportunities to lessen the unemployment rate. Lastly, it can pay its

obligations to the government.

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CHAPTER I

THE PROBLEM AND ITS SETTINGS

Introduction

Rejuvenating products are products that have complete set of skincare routine, which

targets all skin imperfections. Currently, teenagers are mostly users of rejuvenating set, but those

users are experiencing itching and harsh peeling. To address this concern, organic rejuvenating

set will be developed. It is painless, no itching facial whitening set, safe to use for all skin type

and best to use as regular beauty routine for it is pure organic and no harsh ingredients. The

production of organic rejuvenating set will be beneficial to the consumers because of its

accessibility, availability, and cheaper price. The business will offer the resellers an opportunity

to purchase bulk items of organic rejuvenating sets because it is sold directly and the product is

always available.

Globally, skin care products market size was valued at USD 129.23 billion in 2020 and is

expected to expand at an annual growth rate of 4.8% (Grand View Research, 2021). As of now,

skin care products are gaining increasing popularity globally as people are becoming more

conscious of their physical appearance along with being more concerned about skin disorders and

malignancies of the skin. Also, a rising number of consumers opting for skin care products have

also increased. Furthermore, the revenue in the cosmetics segments amounts to US$748.9 in

2021. The market grows annually by 1.92%. By 2021, 80% of sales in cosmetics segment will be

attributable to non-luxury goods (Statista, 2021).

Montrose (2018) explain that, skin rejuvenation involves cosmetic treatments that cause

their face and skin to appear more youthful. The rejuvenating set is very trendy in the Philippines

where there are testimonies showing that the product is effective in fighting pimples and can

make the skin clearer. According to the Sales Channel, the hypermarket led the Philippines skin

care products market share in 2017 where it attributes to increase in popularity due to the
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availability of a broad range of consumer goods. The Philippines skin care products market size

was valued at $1,205.6 million in 2017, and is projected to reach $2,018.6 million by 2027,

registering a CAGR of 7.3% from 2021 to 2027 (Chouchan et., Al 2020).

The proponents aim to offer this organic rejuvenating set production to the market for

most resellers are likely to purchase in bulk orders. In the locality, there is no local producer here

and as observed many youngsters are using rejuvenating products for the most reason of taking

care of themselves.

Statement of the Problem

This study aims to determine the feasibility and viability of rejuvenating set production.

Specifically, it seeks to evaluate the market, technical, management, and financial aspects of the

study.

Scope and Limitation

The study is all about the organic rejuvenating set production. The study will be conducted

in the municipality of Midsayap, Poblacion 1 to 8. The respondents for the demand are the

distributors who has a physical store. The study will start in November 2021 and will end in April

2022.

Significance of the Study

The study is all about the rejuvenating set production. The results of the study will be

beneficial to the following:

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444
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Investors. This study may serve as beneficial to them for they are able to know the status of

business. They can use the results of the study to guide their decisions of what business is suitable

to invest.

Government. The results of the study will provide a basis on making or improving

government policies, rules, and regulations regarding to the business sectors. Data generated from

the study will serve as baseline data for possible solving of intervention and make good decisions.

Academe. This institution will be benefited by making this study as one of the references in

promoting sustainable responsibility to the students of their perspective field. They can also

determine whether the study is viable or not.

Future Researchers. This study will be useful reference for the researchers that will plan to

make any research related studies. The study can help them to develop their viewpoints on the

path of business world.

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Definition of Terms

The following terms are defined operationally and theoretically in the study;

Customer. A person who buys products or services from a store. This refer to resellers of

rejuvenating set who have a physical store.

Organic. It involves production without the use of chemical fertilizers and other artificial

agents. This refer to the ingredient of rejuvenating set that is helpful to avoid itching and harsh

peeling.

Production. Goods being produced in manufacturing process from basic inputs. This refer

to the process of producing raw materials into rejuvenating set products.

Rejuvenating set. A cosmetic brand of beauty product that consists of rejuvenating soap,

rejuvenating toner, sunblock cream with SPF and night cream with peeling properties. This refer

to a product that will be produced in local resellers.

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CHAPTER II

RESEARCH METHODS

This chapter will discuss the research design, research locale, research respondents,

sampling technique, research instrument, data gathering procedure, forecasting tools, and

statistical tools. It also includes the feasibility analysis.

Research Design

The proponents will use descriptive quantitative method in conducting the study.

Descriptive method involves gathering and interpret the data that describe events, organize

information and determine the data collection. Proponents choose descriptive method as research

design because respondents will respond on what, where, when, and how questions. Descriptive

design will consider appropriate to use in feasibility study for it will help respondents to

determine demand of rejuvenating set.

Research Locale

This study will be conducted at Poblacion 1 to 8 in the Municipality of Midsayap,

Cotabato. The proponents choose this location for the business because the area is comprises of

physical stores where distributors are located.

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Research Respondents

The respondents of the study for the demand will be the distributors of rejuvenating sets.

These distributors have a physical store in Midsayap. The data gathered from the respondents will

be used for the demand and supply analysis.

Sampling Technique

The proponents will use judgment sampling as sampling technique for the demand of

rejuvenating set in Midsayap, Poblacion 1 to 8. In this, respondents will be selected according to

an experience of proponents’ judgement that they will meet the requirements of the study.

Research Instrument

The proponents made a survey questionnaire to gather the information of the respondents.

The proponents will use a demand questionnaire. This will help the proponents to determine the

demand of rejuvenating set. For the questionnaire of demand, the respondents will be asked on

the historical demand, willingness to buy, frequency of buying, and the average of serving.

Data Gathering Procedure

In gathering data, there are series of steps that will be followed by the proponents. First, the

proponent will send a letter to the municipal mayor asking permission to conduct a survey in the

Municipality of Midsayap. After the approval of the mayor, the proponents will send a letter to

the barangay captain asking permission to conduct a survey in Poblacion 1 to 8. The respondents
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will be given sufficient time to answer survey and will ask for the most convenient time when the

survey questionnaire can be conducted.

A letter of respondents will be given together with an inform consent form for the demand,

also including the letter of assent as approval in participating to the survey. After that, a

questionnaire will be given to all respondents of the study to collect the needed primarily data.

The proponents will personally approach the respondents and give assurance that the information

taken will be used for the said purpose of the study and will keep for tabulations. The results of

the survey questionnaires will be submitted to research center for storing and disposal.

Forecasting Tools

The proponents will use Arithmetic Straight Line method in computing the projected

demand and supply of the Organic Glow rejuvenating set production. It is a technique that

calculates the overall trend in data set. The Arithmetic Straight Line is highly suggested because

the historical demand had been constantly increasing (Aduana, 2015). Furthermore, proponents

will use this method to forecast the demand and supply because the trend of the historical data is

increasing every year.

Statistical Tools

Statistical methods will be useful to analyze the survey data it involves carrying out a study

include planning, designing, collecting data, analyzing, drawing meaningful interpretation and

reporting of the research findings. Frequency analysis will be used as a tool to summarize data

from the gathering. Frequency analysis is a descriptive statistical method that shows the number

of occurrences of each response chosen by the respondents.

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Industry Analysis

The analysis focuses mainly on the different environmental factors that affect the industry

so as to determine the competitiveness of the proposed business. From the five forces of Michael

Porter, the proponents will use industry rivalry of competitors as strength because there is no

local producers of rejuvenating set in Midsayap. Industry rivalry refers to the extent of firms

within an industry that competitors are trying to steal profit and market share. The weakness in

the study is the bargaining power of suppliers which refers to the pressure that suppliers can put

on companies by raising their prices, lowering their quality, or reducing the availability of their

products. To make it as an opportunity, proponents will offer an organic, affordable, and good

quality of rejuvenating set. Out of five forces, proponents will use only two forces because it is

appropriate to the study.

Competitor Analysis

The proponents will use benchmarking analysis, a simple tool which determine the

capabilities of products or services, especially in comparison to the products or services of

leading competitors. Benchmarking can be applied against any product, process, function or

approach in business (Reh, 2019). When information is not available from documentary sources,

the data are usually provided by the prospective customers through surveys.

Customer Analysis

The proponents will use 5W’s and H to analyze customers need and to find out if which

group of people based on their characteristics satisfies the product in the market. The

questionnaire must be prepared to capture the desire information about the customers, their
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financial capacity, willingness to buy, buying behavior and other related information necessary in

analysis.

Market Analysis

The analysis includes the trends of historical demand data, forecasting, gap analysis,

pricing analysis which will analyze the price elasticity based on the demands in the market for

rejuvenating set production and marketing program.

Technical Analysis

The analysis shall include a study on the availability of the required raw materials,

conversion process, inventory requirements, physical structures, facilities and equipment, and

costing of the product. Also, the study shall include various schedules to be prepared. Every skin

rejuvenating set comes with detailed steps of how to use which consists of two methods, the

morning and evening routines. According to Asian Beauty Hub (2021) first cleanse face with

rejuvenating soap. Rinse well and pat dry with a soft cloth. Then apply an adequate amount into

the palm and massage with gentle upward strokes in the face and neck. In the morning routine use

the toner, rejuvenating cream and sunblock cream same in the evening routine.

Management Analysis

The analysis will include the appropriate organization with accompanying structures, a

study on the qualification requirements, job description, its functions, and salary package and

benefits for the various positions.

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Financial Analysis

In the financial aspect, the proponents will analyze the total project cost, statement of

financial position, statement of comprehensive income, statement of cash flows and statement of

changes in owner's quality. A financial ratio for profitability, liquidity, and solvency is evaluated

as well as the payback period.

Ethical Consideration

These ethical practices and procedures that are observed by the proponents during the

conduct of feasibility study begin from the time the questionnaire is submitted to the CBA faculty

of the school for approval. During the data gathering procedure, every respondent is provided

with a letter of request to signify that he/she allows the proponents to conducting a survey. Also,

it is treated with utmost confidentiality for the protection and welfare of the respondents by

keeping survey responses confidential and protect the respondent’s information. For the security

of respondents, the research center will shred all the questionnaires after it is being validated and

tabulated. The duration of the study conducted started on November 2021 until April 2022.
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MARKET STUDY

This section shows the market analysis, including the product description, demand

and supply situation, and analysis. It also includes the market share, price study, and

marketing program. The result of this analysis will use to determine the demand situation

and to know the product can penetrate the target market.

Product Description

The rejuvenating set is a product that belongs to the cosmetic industry,

manufacturing specialty goods. This product is safe because the ingredients are organic,

which is better for the skin and better for health. Organic Glow Rejuvenating Set

Production can compete in the market because it is a substitute product for any beauty set

product in an affordable price. This product is usually not only for youths but also for

adults.

Demand Situation

The physical stores that sell rejuvenating set in Midsayap, Poblacion 1 to 8, are

the target market of the business. The proponents will tabulate the survey questionnaires

after conducting a survey (Appendix D). The proponents will collect the historical data

from the owner of existing stores who are selling rejuvenating sets in the Poblacion areas
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of Midsayap to project its demand. All of the 20 respondents answered the questions in a

way about how they purchased the rejuvenating set.

Table 1. Projected Demand

Years 2022 2023 2024 2025 2026

Demand (set) 12,800 17,350 24,700 29,950 36,175

Table 1 shows the projected demand for rejuvenating set for five years starting

from 2023 to 2027. The demand is increasing every year because the result of the

historical data of the respondent in demand is also increasing. The basis for the projected

order was the past demand for rejuvenating sets sold in past years.

Supply Situation

The situation of supply in the market is favorable to the business. There is no

supply of rejuvenating set in Midsayap area for the next five years. Although there are

stores that are selling rejuvenating sets, the sources of the suppliers will be located

outside the scope of the study.

Demand and Supply Analysis

The survey will be conducted to determine the demand and supply of rejuvenating

sets in Midsayap area, showing that there are no suppliers or manufacturing

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establishments offering rejuvenating sets in the area. Therefore, there is no supply for the

next five years.

Market Share

The market share is the percentage of the capacity of the business to produce in a

year out of the total demand in the market. It is computed by dividing the total units being

produced every year by the total projected demand (Appendix G).

Table 2. Market Share

Year Annual Production Projected Demand Market Share

2023 3,000 12,800 23%
2024 4,000 17,350 23%
2025 5,000 24,700 26%
2026 8,000 29,950 27%
2027 10,000 36,175 28%

Table 2 shows the market share of Organic Glow Rejuvenating set production.

The average market share of the business is 25.4%. The expected market penetration of

business products is between 10% and 40% (Nordmeyer, 2022). The table shows that the

market share is increasing every year. The projected demand for Organic Glow

rejuvenating set is growing while the annual production of the business is also increasing.
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Price Study

The price of Rejuvenating Set is based on cost-plus pricing. The owner will set

the price of the product by adding the cost of materials, overhead and direct labor then

added with mark-up percentage. The business used this strategy to gain profit because the

business could not predict the changes in the price of overall materials. Charging a 50%

mark-up on a product or service is a safe bet as it ensures that you are earning enough to

cover the cost of production (https://www.freshbooks.com/tools/markup-calculator). The

cost per pack will be ₱200.00 for the first year and 3.0% every year based on the inflation

rate (Appendix H). The cost-plus pricing strategy will be used because it is an easy

method and have an assurance of cost refund and earning a profit for the next five years

(Carlson, 2019).

Marketing Program

The business is engaged in producing and selling rejuvenating sets. The product

will be promoted through social media like Facebook, Instagram, and posters. It is a

promotional method where it is an accessible and wide range of viewers. As for cost

efficiency, the business will rent a motor and schedule its delivery. The business will

have a budget of 10,000 for the advertising fee. It will be using a push marketing strategy

for the distribution. According to Magloff (2019), new businesses use push strategies to

develop retail markets for the products and generate exposure.

 
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Conclusion

The business appears to be feasible because, based on the study, the projected

demand is increasing every year. The market share is favorable for the business, where it

has an average market share of 25.4%. The affordable price set for the product will

ensure profit to cover the production and overhead costs. The business's marketing

program is easy to do since it is accessible and has many viewers. Also, the business will

be using a push marketing strategy for distribution.

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TECHNICAL STUDY

The technical study includes the product description, product process, production

capacity, and production schedule. It also contains the building structure and store layout,

equipment and tools, furniture and fixtures, and supplies. Furthermore, it determines the

raw materials requirements, direct labor requirements, utilities, overhead requirements,

waste disposal system, and conclusion.

Product Description

The rejuvenating set is a set of skincare products that work creatively together to

treat skin concerns. It is usually composed of skincare products such as toner, whitening

soap, whitening cream, and sunblock cream. The specific chemical contents of the

rejuvenating set are alpha hydroxyl acids, beta hydroxyl acids, antioxidants, tranexamic

acid, and herbal extracts. Organic Glow rejuvenating soap weighs 135 grams, its toner

has 60 ml, and both whitening cream and moisturizer have 10 grams. The rejuvenating

set will consider a non-perishable product for it has a long shelf-life. It can be essential to

reduce the appearance of pimple marks and remove whiteheads, blackheads, and other

forms of acne scars. Each pack of a rejuvenating set will be put on its designated

packaging. (Appendix I)
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Manufacturing Process

The manufacturing process is the process of converting raw materials into

finished products. Rejuvenating set production will comprise various methods that

correctly specify each product. The workers will prepare the needed materials to start the

show. It will take 5-8 hours in a day of processing to make 125 sets of rejuvenating

products monthly.

Figure 1. Manufacturing Process of Skin Toner

Ingredients
Blending

Mixing

Inspection of Semi- Packaging Storing

Finished Skin Toner

Ingredients Blending

This process includes raw materials such as plain distilled water, milk whitening

salt, acetyl alcohol, and sakura scent essential oil blended thoroughly. About 2 gallons of

plain distilled water, 2 kg of milk whitening salt, and eight packs of acetyl alcohol will be
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put in a big container. They will be manually measured using the measuring beaker. An

electric stick blender will be used in this process to blend all the raw materials.

Mixing

An electric hand mixer will be used in mixing all the raw materials and the ten

bottles of sakura scent essential oil. It will be mixed and stirred thoroughly to combine

with other ingredients. Mixing vessels will be necessary to use in this process to put the

mixed ingredients.

Inspection of Semi-Finished Skin Toner

After mixing and stirring ingredients, manufacturers will inspect the semi-finished

skin toner to ensure no difficulty in the process. The inspection process will be done by

checking the correct formula and elements of the skin toner.

Packaging

The packaging process will composeputting skin toner in a 60 ml container and

printing a customized brand design and labeled ingredients using a heat sealer. It will

take 4-6 hours for the packaging process.

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Storing

The finished products will be stored away from the steam area, and it is essential

to keep them in a cool and dry place in the factory. All of the products will be put in their

designated storage and carton box.

Figure 2. Manufacturing Process of Whitening Soap

Ingredients
Blending

Mixing

Cooling, Pouring, Packaging Final Product

and Molding Inspection and Storing

Ingredients Blending

All of the raw materials, such as 4 gallons of plain distilled water, five bottles of

papaya extract, one pack of L-glutathione powder, three packs of milk whitening salt, and

2 liters of virgin coconut oil, will be blended into an immersion blender. It will take 2-3

hours of the blending process.

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Mixing

Mixing and stirring ingredients will be put aside using the electric hand mixer and

mixing vessels. Big containers will be paced after the mixing so that they will quickly

take in the following process. It will take an estimated 3 hours to mix and stir all the

ingredients.Ten bottles of 10 ml sakura scent essential oil will be thoroughly mixed after

the blended raw materials.

Cooling, Pouring, and Molding

This process will be done using the thermometer to measure the coolness being

applied to the product. Ingredients will be cooled until the mixtures drop below 82 ℃

.After pouring, the soap into the recycled containers for molding, let it cool for 10 hours.

Packaging

Soap wrappers with customized brand designs and labeled ingredients will be

used to pack the molded soap. Soap stiffenerpaper which is a coated paper and majorly

used in bath soap packaging, will be used to maintain the freshness and fragrance of the

soap.

Final Product Inspection and Storing

After the packaging process, all the finished soaps will store in a cool and dry

place. It will keep away from direct sunlight and heat sources. Also, wrap bars will be
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individually put in a plastic wrapper put inside a sealed plastic container to prevent

exposure to air and excess moisture forms.

Figure 3. Manufacturing Process of Whitening Cream

Mixing and Heating

of Ingredients

Cooling and
Stirring

Inspection of Semi- Packaging Storing

Finished Cream

Mixing and Heating of Ingredients

Ingredients such as three bottles of papaya extract, three bottles of carrot extract,

2 liters of virgin coconut oil, three packs of milk whitening salt, and one pack of L-

glutathione powder will be mixed and heated thoroughly. Manufacturers will use

protective gloves and disposable facemask in mixing and heating all the ingredients. This

process will be done using the electric hand mixer, thermometer, measuring spoon, and

immersion blender. This will take 5-4 hours of mixing and heating process.
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Cooling and Stirring

These processes will use a thermometer to measure the cooling effect of the

whitening cream. After that, it will be stirred and added with additional ingredients such

as ten bottles of sakurascent essential oil and five bottles of organic castor oil.

Inspection of Semi-Finished Cream

Assigned employees will check the semi-finished whitening cream to assure that

there are no ingredients being forgotten by the manufacturers. It will take an hour to

inspect the products and list them according to the target number of products that will be

produced.

Packaging

Whitening cream will be put in a 10 grams small container, and it will be labeled

with its ingredients and customized brand design. It will take 3-5 hours to finish the

packaging process.

Storing

After all the processes, storing process will be done by putting all the finished

whitening cream products in their designated storage box. It will be placed in a cool and

dry area and will not be directly from the heat of the sunlight.
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Figure 4. Manufacturing Process of Skin Moisturizer

Ingredients Heating
and Blending

Ingredients
Stirring

Inspection of Semi- Packagin Storing

Finished Skin Moisturizer g

Ingredients Heating and Blending

All of the raw materials for the production of moisturizer will be heated and

blended using the immersion blender and thermometer. These raw materials are 2 gallons

of plain distilled water, one pack of shea butter, one bottle of sugarcane distillate, and 3

liters of virgin coconut oil. The components are manually blended, and the process will

take 3-5 hours of blending and heating.

Ingredients Stirring

After the ingredients heating and blending, the next is stirring of 100 ml bottle of

aloe Vera extract and ten bottles of 10 ml sakura scent essential oil. Once the final texture

is solidified, it will mix the ingredients together again to reveal the final output. The
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process will be done, and it will be put on a significant clean container and will be

measured using a measuring spoon.

Inspection of Semi-Finished Moisturizer

The assigned employees will check the inspection of the semi-finished

moisturizer, and it will be manually checked.

Packaging

Skin Moisturizer will be put on a 10 grams container containing its labeled

ingredients and customized packaging design. This will be done using the heat sealer, and

it will take an estimated 3 hours the process.

Storing

Skin moisturizer will be stored away from the sunlight and direct from the cooler

temperature of the area. Also, these products will be tightly sealed to preserve their

quality and to avoid any products damage.

Production Capacity

The production capacity shows the average sets that will produce. The raw

materials of every production can make up of 250sets which is equivalent to 5 semi-

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medium carton boxes. The manufacturer and owner will assist the employees in finishing

the job at an appropriate time. The production will be done in the processing area of the

Organic Glow rejuvenating set factory. There will be an increasing number of sets of

rejuvenating products produced for five years.

Table 3. Production Capacity

Year Monthly Production Annually Production

2023 250 3,000
2024 333 4,000
2025 417 5,000
2026 667 8,000
2027 833 10,000

Table 3 shows the monthly and annual production capacity of the business. The

company's yearly production is increasing every year because it seems to be appropriate

to cater to the unsatisfied demand.

Production Schedule

Production schedule refers to all the resources used for production activities, such

as raw materials that will be allocated.

Table 4. Production Schedule

Year Monthly Production Annually Production

2023 250 3,000
2024 333 4,000
2025 417 5,000
2026 667 8,000
2027 833 10,000
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Table 4 shows the annual production of the business. The business will operate

six days a week, and the presentation will be thrice a month. The scheduled production

day will be from the first to the third week of the month, and the last week will be for

delivery.

Equipment and Tools

The business will directly purchase the equipment and tools needed for the

production. All tools and equipment are available in Midsayap, which is advantage to the

owner as these can be easily purchased (Appendix K).

Table 5. Equipment

Items Store Useful Life Quantity Cost

Computer Set EMCOR Midsayap 5 1 15,000
Epson single printer EMCOR Midsayap 5 1 8,000
Total ₱ 23,000

Table 6. Tools

Items Store Useful Life Quantity Cost

Heat sealer 3 2 ₱ 590

Digital scale 5 2 1,300
Cosmetics thermometer 3 3 750
Electric hand mixer 4 4 755
Measuring beaker 5 10 560
Electric stick blender 5 2 850
Mixing bowl 5 16 420
Immersion blender 5 2 2,600
Big containers 4 6 900
Glass rod 3 10 320
Measuring spoon 3 14 150
Total ₱ 9,195
 33

The table 5 and 6 show the equipment and tools that will be used in the business.

It is essential to have this equipment to help the business buy and deliver the products

being produced by the industry. The equipment and tools are necessary to assist the

business in executing the production process and services. Therefore, as the production

capacity increases, there is no need to purchase equipment, but there is additional hiring

of employees.

Furniture and Fixtures

The furniture and fixtures that are needed in the business will be used in its daily

operation. The owner will purchase the furniture and fixtures in Midsayap, where these

are widely available. (Appendix L)

Table 7. Furniture and fixtures.

Items Store Useful Life Quantity Cost

Chair NOVO 5 5 ₱ 1,500
Long table Tandog Furniture 5 2 2,000
Storage rack Tandog Furniture 5 2 3,000
Air conditioner MAC Appliance 5 2 26,500
Total ₱ 33,000

The furniture and fixtures needed in the business will be purchased in the

municipality of Midsayap. It is an advantage to the industry since the furniture and

fixtures can be purchased locally, so the industry can reduce costs.

 34

Supplies

The supplies will be purchased in Midsayap, Cotabato. The availability of

supplies in Midsayap is beneficial to the business operation since they can be purchased

nearby

Table 8. Supplies

Items Store Quantity Annual Cost

Protective gloves NOVO 50 pcs. ₱ 900
Kitchen towel NOVO 20 pcs. 800

Disposable Facemask NOVO Two boxes 900

Floor mop NOVO One pc. 60
Large Basin NOVO Two pcs. 560
Trash Can NOVO Three pcs. 640
Carton Box NOVO 50 pcs. 500
Soap Stiffener Paper NOVO Five packs 1000
Total ₱ 5,360

Table 8 shows that the business will purchase supplies on a monthly basis and it is

calculated annually. The large basin will be bought once a year, while the trash can will

be purchased twice a year.

Raw Materials Requirements

The most important raw material in rejuvenating set production is Sakura scent

essential oil. Sakura perfume essential oil will be purchased directly from the different

drugstores and pharmacies in the PALMA area. The business will have multiple contact

raw materials purchased in the groceries and pharmacies in the municipality of Midsayap.
 35

Table 9. Raw Materials

Items Quantity Cost Monthly Annually

Skin Toner
Plain distilled water Two gals. ₱ 25 ₱ 50 ₱ 600
Milk whitening salt 2 kg 200 400 4,800
Acetyl alcohol Eight packs 170 1,360 52,320
Sakura scent essential oil Ten bottles 40 400 4,800
Total ₱ 435 ₱ 2,210 ₱ 62,520

Whitening Soap
Plain distilled water Four gals. ₱ 25 ₱ 100 ₱ 1,200
Papaya extract Five bottles 160 800 9,600
L-glutathione powder One pack 300 300 3,600
Sakura scent essential oil Ten bottles 40 400 4,800
Milk whitening salt Three packs 200 600 7,200
Virgin coconut oil 2 liters 290 580 6,960
Total ₱ 1,015 ₱ 2,780 ₱ 33,360

Whitening Cream
Papaya extract Three bottles ₱ 160 ₱ 480 ₱ 5,760
Carrot extract Three bottles 190 570 6,840
Virgin coconut oil 2 liters 290 580 6,960
L-glutathione powder One pack 300 300 3,600
Sakura scent essential oil Ten bottles 40 400 4,800
Organic castor oil Five bottles 120 600 7,200
Milk whitening salt Three packs 200 600 7,200
Total ₱ 1,300 ₱ 3,530 ₱ 42,360

Items Quantity Cost Monthly Annually

Plain distilled water Two gals. ₱ 25 ₱ 50 ₱ 600
Shea butter One pack 450 450 5,400
Sugarcane distillate One bottle 250 250 3,000
Virgin coconut oil 3 liters 870 870 11,310
Aloe Vera extract 100 ml bottle 250 250 3,000
Sakura scent essential oil Ten bottles 40 400 4,800
 36

Total ₱ 2,245 ₱ 2,270 ₱ 28,110

Products Monthly Annually

Skin Toner 2,210 26,520

Whitening Soap 2,780 33,360
Whitening Cream 3,530 42,360
Moisturizer 2,270 27,240
Total ₱ 10,790 ₱129,480

Direct Labor Requirements

Direct labor refers to the wage of workers who are directly involved in producing

the product. The owner will hire a manufacturer, delivery boy, packaging in-charge, and

a utility worker who will be directly involved in making a rejuvenating set. The workers

that will be hired will be on a personal and call basis, and they will be working 26 days a

month. The daily wage of the workers will be a minimum of ₱ 350.

Utilities and Overhead Requirements

The business will utilize the services of Metro Midsayap Water District

(MMWD), Cotabato Electric Cooperative (COTELCO), and Petron for the electrical

energy and gas supply to sustain its daily operation. The estimated total monthly

consumption of utilities and overhead will be ₱26,000. The rental fee will be 20,000/

month, the water will be 500/month, the electric bill will be 4500/month, and the gas and

oil will be 1,000 in a week, including the repairs and maintenance of the motorcycle for

the delivery of the product. The motorcycle will be owned by a delivery boy.
 37

Building Structure and Store Layout

The layout of the business is designed to maximize the space and accommodate

the needs of the employees. It is designed to ensure that the tools and equipment are

correctly arranged in terms of the areas of processing which can help the workers to

perform their job well. Since the building will be rented and renovated, it will cost an

estimated ₱100,000 for the rental fee, labor fee, and renovations. The rental fee will cost

20,000 monthly, the labors fee will and purchasing of materials for the renovation of the

building will cost 80,000. (Appendix B)

Waste Disposal System

The business will use three trash cans to segregate the waste used in the

production. Non-biodegradable waste like plastic cellophane will be separated from

biodegradable and recyclable waste. Waste disposal will be closely monitored to maintain

the sanitation of the business and its good image. The garbage will be collected by the

garbage collector of the local government unit of Midsayap on its scheduled day.

Manufacturing Cost Requirements

 38

Manufacturing costs play an essential part in the successful design and

manufacture of a product. It is a sum of the expenses in all resources consumedduring the

production of the product. These costs include raw materials, direct labor, and

manufacturing overhead.

Table 10. Manufacturing Cost Requirements

Manufacturing Costs Monthly Costs Annually Costs

Raw Materials Costs ₱ 10,790 ₱ 129,480
Direct Labor Costs 35,000 420,000
Overhead Costs 26,000 312,000
Total ₱ 71,790 ₱ 861,480

Table 11 shows that manufacturing cost requirements are required to incur the

costs of raw materials, direct labor, and overhead costs. The business will have ₱ 71,790

in monthly expenses and ₱ 861,480 in annual expenses.

Conclusion

The business appears to be feasible in terms of technical study. Thrice a month

will be the operation of production.Two hundred fifty sets will be achievable to produce

per month. It is essential to know where to buy all the raw materials needed in the

business to plan the investment allocation properly. The employees will use the tools and

equipment who will be in charge of rejuvenating set production. The company will use

trash cans for the waste to be appropriately segregated. A business will also observe and

maintain cleanliness in the area.

MANAGEMENT STUDY
 39

This section aims to determine the people involved in the operation. The business

will determine the type of business organization, the organizational structure, and how

the owner will manage the business. It also includes staffing requirements, workers'

compensation and benefits, and the project schedule.

Type of Business Organization

The business is a sole proprietorship type of business organization. It is managed

by the business owner, who is also in charge of running the business's day-to-day

operation and accountable for the business investment. The process of the company is

effortless and requires a few laborers only. A sole proprietorship is the most appropriate

type of business organization for the business because rejuvenating sets production can

acquire a minimum amount of capital to start the operation. The company requires

managerial skills needed to consist of a small amount of money to begin its operating

activities of the business. It has characteristics including ease of formation and simple

management operation suitable for the company. Since the business belongs to the

cosmetic industry, all-natural skincare products will be FDA approved and with a license

to operate.

The Organizational Structure

 40

The organizational structure shows the structural design of the business

organization. The owner can quickly identify the producers of the beauty products

because of the simple business structure, and the owner is expected to be the top

management who has control of all of the business activities.

Owner

Manufacturers Packaging In- Delivery Boy Utility Worker

charge

Figure 5. The Organizational Chart

Figure 5 shows the structure of the business. The owner is in the highest position

and has the power to control, manage and command the industry. Each function has a

different responsibility depending on the rules of the company. A flat structure is used in

the organizational chart wherein the distribution of their works is given directly by the

owner and under its supervision.

Staffing Requirements

The main objective of rejuvenating sets production is to produce high-quality,

affordable, and effective products that can compete with and satisfy other beauty

products. The owner will hire three manufacturing plants, two delivery boys, and two

packaging in charge for each daily operation. The management will develop staffing
 41

requirements that will guide the employees in producing and performing the task. The

employees will work 8 hours a day and six days a week under the supervision of the

owner.

Owner

The owner will be the manager of the proposed business and will also be in

charge of the company's finances. The owner will be in charge of overseeing the financial

transaction such as financing, inventory, planning, and decision-making of the business

and the security of the workers.

Manufacturer

This involves indirect labor, which is responsible for preparing the raw materials

and will ensure the products they produce. To maintain the cleanliness and proper

sanitation of the working area, the manufacturer will be responsible for keeping the

product all-natural and organic.

Delivery Boy

The delivery boy must have a driver's license, and he will be the one responsible

for delivering the products and taking orders from the customers. He is also in charge of

assisting the owner in buying the raw materials that are needed for the production.

Packaging In-charge
 42

The packaging in charge will be responsible for packing and making the product a

presentable one. They will be needed to ensure the product will be packed with its

designated weight. Where rejuvenating toner will weigh 60 ml, rejuvenating cream and

moisturizer have 10 grams, and whitening soap of 135 grams. The assigned employees

will clean the tools to be used before and after the operation.

Utility Worker

Utility workers are responsible for cleaning the facility and performing basic

repairs. Their duties are to repair light fixtures or other pieces of equipment, clean rooms

inside a property, and order cleaning supplies and tools for use in repairs.

Compensation and Benefits

Employees’ compensation and benefits will motivate and give employees job

satisfaction in return for their services in the business. The business will hire a

manufacturer, packaging in charge, delivery boy, and utility worker. Since the production

capacity increases, the company shall employ more employees yearly to speed up the

human resources process. Moreover, employees will require to pay 12% of their monthly

salary for the SSS contribution, and 2.75% will be deducted from the PhilHealth

contribution.

Table 11. Employee compensation and benefits.

 43

Employees No. of Monthly Employee’s Benefits

Employee Salary SSS PhilHealth
Manufacturer 1 ₱ 9,100 ₱1,100 ₱ 250
Delivery Boy 1 1500 180 40
Packaging in-charge 1 8,500 1,020 230
Utility worker 1 3,000 360 230
Total ₱ 22,100 ₱2,660 ₱ 600

Project Schedule

The project shown in Figure 3 is the set of activities needed to be undertaken in

2022. It will serve as a guide for the activities to be undertaken to start the business. It

indicates the time frame required to be performed within the time.

Activities 2022 2023

AUG SEP OCT NOV DEC JAN

Processing of Business
Permits
Renovation of the Building

Acquisition of Fixed assets

Purchasing of Raw Materials

Start of Business Operation

Figure 6. Project Schedule

The project schedule shows that the business will start to operate in January 2023

after processing the business permits, renovating the building, acquiring fixed assets, and

purchasing raw materials and supplies. The cost for the renovation of the building will be

₱ 80,000, and the cost of permits and licenses will be ₱ 4,000. The promotion and
 44

advertising will be done before the opening of the business to ensure the successful

launching of the product.

Conclusion

The management study of the business appears to be feasible because the owner

will be the one to supervise the operation. The company is a sole proprietorship, which

means that the owner will be the one to provide the capital to start the business operation.

The hiring process of the employees will be based on the necessary expertise and abilities

in doing the job. The workers will be under the owner’s direct supervision. The wages,

compensation, and benefits will be given fairly to the workers. The business will start on

January 2023 after all the activities in the project schedule have been completed.

FINANCIAL STUDY
 45

This section shows the total project cost, projected statement of financial position,

projected statement of comprehensive income, projected cash flow, and projected

statement of changes in owner’s equity. It also presents the financial ratio analysis such

as return on investment, gross profit margin, net profit margin, and payback period.

Total Project Cost

This section shows the total cost that will be needed to operate the business. The

total project cost can be calculated by getting the total of estimated cost of the materials

needed in the production and operation of business.

Table 12. Total Project Cost

Particular Cost
Building Improvement ₱ 100,000
Equipment and Tools 32,195
Furniture and Fixtures 33,000
Supplies 35,360
Working Capital 99,445
Total ₱ 300,000

Table 12 shows the total costs of assets that are needed to start up the business. It

indicates the project cost of the building, machinery and equipment, furniture and

fixtures, and operating expenses. These all will acquire by trheownere through cash,

before the first operation of the Organic Glow rejuvenating set production. The total

production must become up because it will cover all the business requirements.

The Projected Statement of Financial Position

 46

The statement will show the business's financial position in 2023-2027. The idea

of financial position shows the assets, liabilities, and equity of a business entity as of a

given date (Aduana, 2015).

Rejuvenating Set Production

Projected Statement of Financial Position
For the years 2023 - 2027

2023 2024 2025 2026 2027

ASSETS
Current Assets
Cash P 172,445.00 365,585.00 744,336.36 1,662,025.76 2,973,721.05
Total Current Assets 172,445.00 365,585.00 744,336.36 1,662,025.76 2,973,721.05
Non-Current Assets
Property, Plant and Equipment, net 129,165.25 113,135.50 98,772.42 85,012.67 71,666.67
Total Non-Current Assets 129,165.25 113,135.50 98,772.42 85,012.67 71,666.67
TOTAL ASSETS P 301,610.25 478,720.50 843,108.77 1,747,038.43 3,045,387.72

LIABILITIES & EQUITY

Total Equity P 301,610.25 478,720.50 843,108.77 1,747,038.43 3,045,387.72
TOTAL LIABILITIES & EQUITY
P 301,610.25 478,720.50 843,108.77 1,747,038.43 3,045,387.72

The projected statement of financial position shows the annual amount of current

and non-current assets of the business and the owner's equity for five years projection. It

shows that the business's total assets are continually increasing at the end of the year.

This is due to the net profit incurred every year.

The Projected Statement of Comprehensive Income

The statement of comprehensive income shows the financial performance of a

business entity for a given period (Aduana, 2015). The information will show the

projected income or loss from 2023 to 2027.

 47

Rejuvenating Set Production

Projected Statement of Comprehensive Income
For the years 2023 - 2027

2023 2024 2025 2026 2027

Revenue 600,000.00 824,000.00 1,060,900.00 1,748,363.20 2,251,017.62
Cost of Sales 435,263.08 483,725.28 534,974.99 682,856.71 791,050.19
Gross Profit 164,736.92 340,274.72 525,925.01 1,065,506.49 1,459,967.43
Less : Operating Expenses
Supplies 1,260.00 1,297.80 1,336.73 1,376.84 1,418.14
Permits and Licenses 4,000.00 4,000.00 4,000.00 4,000.00 4,000.00
Utilities Expenses 60,000.00 60,000.00 60,000.00 60,000.00 60,000.00
Gas and Oil Expenses 4,000.00 4,000.00 4,000.00 4,000.00 4,000.00
Depreciation Expenses 13,866.67 13,866.67 12,200.00 12,200.00 12,200.00
Advertising Expense 10,000.00 10,000.00 10,000.00 10,000.00 10,000.00
Rent Expense 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00
Total Operating Expenses 113,126.67 113,164.47 111,536.73 111,576.84 111,618.14
Net Income 51,610.25 227,110.25 414,388.27 953,929.65 1,348,349.29

The comprehensive income will show all the activities involved in sales and

expenses incurred every year. Based on the data, the business will incur profit at the end

of the year. The business sales are enough to cover the expenses that will incur every

year.

The Projected Statement of Cash Flow

The statement of cash flows will show the amount of cash generated and

disbursed during a specific period, it shows the sources of cash flow and outflows of cash

(Aduana, 2015). The cash flow occurred from its cash receipt less all the operating

activities expenses.
 48

Mindificient Study Lounge

Rejuvenating Set Production
Statement of Cash Flows
For the years 2023 - 2027

2023 2024 2025 2026 2027

Cash Flows from Operating Activities
Net Income before Tax 51,610.25 227,110.25 414,388.27 953,929.65 1,348,349.29
Adjustments for:
Depreciation (9) 16,029.75 16,029.75 14,363.08 13,759.75 13,346.00
Total 67,640.00 243,140.00 428,751.36 967,689.40 1,361,695.29
Changes in Operating Assets and Liabilities
Decrease (increase) in the amounts of: - - - - -
Net Cash provided by (used in)
Operating Activities 67,640.00 243,140.00 428,751.36 967,689.40 1,361,695.29

Cash Flows from Investing Activities

Additions in PPE (9) (145,195.00) - - - -
Net Cash provided by (used in)
Investing Activities (145,195.00) - - - -

Cash Flows from Financing Activities

Investment by Owners 300,000.00 - - - -
Drawing by Owners (50,000.00) (50,000.00) (50,000.00) (50,000.00) (50,000.00)
Net Cash provided by (used in)
Financing Activities 250,000.00 (50,000.00) (50,000.00) (50,000.00) (50,000.00)
Increase (decrease) in Cash 172,445.00 193,140.00 378,751.36 917,689.40 1,311,695.29
Cash, Beginning - 172,445.00 365,585.00 744,336.36 1,662,025.76
Cash, End 172,445.00 365,585.00 744,336.36 1,662,025.76 2,973,721.05

Cash flow is a virtual movement or transfer of money, it is the net amount of cash

and cash equivalent being transferred into and out of business (Kenton, 2019). Operating

activities show the amount of money being transferred into the industry through sales

receipts; the cash outflows are used to purchase raw materials, for the payments of the

licenses and permits, salaries and wages, supplies expenses, and utility expenses.

Investing activities show the number of cash outflows used to purchase machinery and

equipment, furniture and fixtures, and building. The financing activities only show the

remaining initial investment by the owner at the start of the business operation. The

method being used in cash flow is the direct method.This means that the business have
 49

generated enough cash flow to maintain the operating capability of the business. The

method that was used is indirect method.

The Projected Statement of Changes in Owner’s Equity

The statement of changes in owner’s equity will present the movements and

changes in the owner’s equity section of the balance sheet (Aduana, 2015). The owner's

capital is continually increasing every year due to incurred profit.

Rejuvenating Set Production

Statement of Statement of Changes in Equity
For the years 2023 - 2027

2023 2024 2025 2026 2027

Beginning Capital 300,000.00 301,610.25 478,720.50 843,108.77 1,747,038.43
Add (Less): Net Income (Loss) 51,610.25 227,110.25 414,388.27 953,929.65 1,348,349.29
Less: Drawing (50,000.00) (50,000.00) (50,000.00) (50,000.00) (50,000.00)
Ending Capital 301,610.25 478,720.50 843,108.77 1,747,038.43 3,045,387.72

The item affecting the owner’s equity is on ly the net income earned and the

annual withdrawal of the business within the period. The projection shows that the ending

balance is increasing value for five years where it has a positive impact to the business

because this shows that the business has an increasing profit. It also indicates that the

business has managed well the capital that has been invested.

Financial Ratio Analysis

The financial ratio analysis is to evaluate or analyze the financial performance of

the business. This includes return on equity, gross profit margins, net profit margin and

assetvturnover of the business in order to form a conclusion.

 50

Return on Investment

The return on investment measures the amount of net income of investment over

the total equity of the business. Return on investment is a performance measure used to

evaluate the efficiency of an investment or compare the efficiency of a number of

different investment (Chen, 2020)

Table 13. Return on Investment

Year 2023 2024 2025 2026 2027

Return on investment 16.56% 45.54% 47.46% 53.38% 43.56%

Table 13 shows the return on equity of the business for the next five years. It is

calculated by dividing the net income from the total equity (Appendix ___). It shows that

it is increasing in four consecutive years while in fifth year it is decreasing because of the

low income. This means a favorable condition to the business since it is still profitable at

the end of four years.

Gross Profit Margin

The gross profit margin measures the overall operating results of an entity. The

gross profit margin is measured by gross income over the revenue. It considers all income

recognized and all expenses incurred during the period. It indicates that the amount of

gross profit of the business is enough to cover up its operating expenses. It also shows

that the owner has effectively managed the business because of a constant gross profit for

five years.
 51

Table 14. Gross Profit Margin

Year 2023 2024 2025 2026 2027

Gross profit margin 27.46% 41.30% 49.57% 60.94% 64.86%

The table shows that the gross profit margin of the Organic Glow rejuvenating set

production is increasing in five consecutive years. The result is a good profit margin for

the business because it considered as a positive indication. Where in, it is enough to pay

its operating expenses and there is profit after considering all the expenses upon its

operation.

Net Profit Margin

The net profit margin is measured by net income over the revenue where the

result is converted into a percentage or ratio. This measures overall operating result of a

business entity considering all the income and expenses incurred.

Table 15. Net Profit Margin

Year 2023 2024 2025 2026 2027

Net profit margin 8.60% 27.56% 39.06% 54.56% 59.90%

As shown in table 15, the net profit margin of Organic Glow rejuvenating set

production from 2023 to 2027 generates and creates enough profit for the business. This

means a favorable condition to the business since it is still profitable at the end of the

year.
 52

Payback Period

The payback period refers to the amount of time it takes for the business to

recover the cost of an investment (Kagan, 2019). The desirability of an investment is

directly related to its payback period. The payback period is either a short or l;ong period

of time where shorter payback means more attractive investment.

Table 16. Payback Period

Cost of Investment Cash Inflow Unrecovered Period

300,000.00 - (300,000.00)
2023 - 67,640.00 (232,360.00) 1
2024 243,140.00 10,780.00 0.92
1.92 years
23.01 mos.

As the table presented the payback of the business is 1.92 years. This means that

the initial investment of the business will be recovered in almost two years which is

considered as favorable for the business.

Conclusion

The financial study of Organic Glow Rejuvenating Set Production appears to be

feasible since the business is profitable and it indicates total assets increase. The business

can generate money which can cover all liabilities and expenses. In terms of gross profit

margin and net profit margin shows a positive indication where it has the ability to gain

enough profit for the business. The investments will be recovered almost two years which

is considered as a long term payback period.

 53

SOCIO-ECONOMIC STUDY

The socio-economic study aimed to determine the business's social benefits,

government obligation, and other socio-economic benefits. The proper waste and garbage

management will also be included in this section.

Government Obligation

The business will contribute to the government through timely payment for

licenses and other applicable fees. Organic glow production will follow the process of

building a business. The business owner will comply with all the requirements set by the

government unit before starting the business. The company will be registered with the

local government unit (LGU) through the Bureau of Internal Revenue (BIR) for legal

operation.

Other Socio-Economic Benefits

Organic glow production will contribute to specific individuals. The business

offers employment and provides income to the workers who meet the job qualifications.

Each employee will receive a benefit such as SSS and PhilHealth. The management will

be responsible for paying for the contribution to the agencies above.

 54

Conclusion

In this study, it is concluded that the socio-economic aspect of the study is

feasible because the government will earn from the business. Through their authority to

require a permit, they can share the benefits of the business. It also gives employment to

the local community to support their basic needs. The higher the income, the more it can

give to its locality.

 55

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Nick L. Aduana. 2015. Writing Project Feasibility Study. Retrieved on February 20, 2022

Price Beam. 2020. Cosmetics Pricing. Retrieved on November 7, 2021

https://www.pricebeam.com/cosmetics-pricing.
 56

Statista. 2021. Cosmetics Market Forecast. Retrieved on November 5, 2021

https://www.statista.com/outlook/cmo/beauty/personal/beauty-care/cosmetics/
Philippines

https://psa.gov.ph/statistics/survey/price/summary-inflation-report-consumer-
price-index-2018100-january2022
 57

Appendix A. Location Layout

KIMAGANGO
OUTPOST

ROAD TO BULANAN NATIONAL HIGHWAY ROAD TO MIDSAYAP

KIMAGANGO BARANGAY

HIGH HALL CAMP

SCHOOL

ANATOLIA

RESORT

RESIDENCES

RESIDENCES ROAD TO ILBOCEAN

ORGANIC
GLOW
REJUVENATING
SET FACTORY
 58

Appendix B. Facility Layout

8m

Admin
Storage
Building
Room 2

Washing Area

10 m Gate

Packaging Area Storage

Room 1

Production Area Fire Exit

Comfort Room Employees Room

 59

Appendix C. Survey Questionnaire for Demand

Southern Christian College

United Church of Christ in the Philippines
Midsayap, Cotabato
COLLEGE OF BUSINESS AND ACCOUNTANCY
[email protected]

QUESTIONNAIRE

Instructions: Please answer the following questions by putting (√) on the circle.

Name of the Business: (Optional)

Address:

1. What type of Rejuvenating set do you sell in your store?

( ) Organic
( ) Inorganic

2. Where did you source out your supply of Rejuvenating Set?

( ) Philippines through a distributor
( ) Philippines, ordered online
( ) Outside the Philippines, ordered online
( ) Others: please specify ___________
 60

3. Why did you choose to buy from that distributor?

___________________

4. How many packs of Rejuvenating Set do you usually purchase in a yearly basis?
______ 2017
______ 2018
______ 2019
______ 2020
______ 2021

5. If Rejuvenating Set will be produce locally, are you willing to buy?

( ) Yes
( ) No

6. If yes, how many packs of Rejuvenating Set will you buy on a monthly basis?
Please specify. _____________
 61

Appendix D. Tally for Demand

WHAT TYPE OF REJUVENATING SET DO YOU SELL IN YOUR STORE?

ORGANIC INORGANIC

FABULEUX FASHION STORE 1 1

RB KIM’S FASHION APPAREL 1
SNX FASHION COLLECTION 1
QUE LE CHIE 1 1
LABAYAN FASHION BOUTIQUE 1 1
MPC ONLINE SHOP 1
CONCEPT HUB 1
STORE 1 1
CRISTELLE 1
STORE 2 1 1
PRINCESS BOUTIQUE 1 1
DIOKNO C. SARIEGO 1 1
AILA OVERRUNS 1
MIDSHOP FASHION STORE 1
AMAZING SKIN BEAUTY SHOP (BRANCH 2) 1
FELJEMS HEALTH & BEAUTY PRODUCTS 1
G-NOR BEAUTY HUB 1 1
G-NOR BEAUTYHUB (BRANCH 2) 1
AJ MARKETING 1 1
STORE 3 1 1
TOTAL 17 12

WHERE DID YOU SOURCE OUT YOUR SUPPLY OF REJUVENATING SET?

 62

PHILIPPINES PHILIPPINES, OUTSIDE, OTHERS:

THROUGH A ORDERED LINE ORDERED PLEASE
DISTRIBUTOR LINE SPECIFY

FABULEUX 1
FASHION STORE
RB KIM’S 1
FASHION
APPAREL
SNX FASHION 1
COLLECTION
QUE LE CHIE 1
LABAYAN 1
FASHION
BOUTIQUE
MPC ONLINE 1
SHOP
CONCEPT HUB 1
STORE 1 1
CRISTELLE 1
STORE 2 1 1
PRINCESS 1
BOUTIQUE
DIOKNO C. 1
SARIEGO
AILA OVERRUNS 1
MIDSHOP 1
FASHION STORE
AMAZING SKIN MANUFA
BEAUTY SHOP CTURER&
(BRANCH 2) OWNER
FELJEMS OWNER &
HEALTH & MANUFA
BEAUTY CTURER
PRODUCTS
G-NOR BEAUTY 1
HUB
G-NOR BEAUTY 1
HUB (BRANCH 2)
AJ MARKETING 1
STORE 3 1
 63

TOTAL 17 2

WHY DID YOU CHOOSE TO BUY FROM THAT DISTRIBUTOR?

EFFECTIVE LEGIT FDA AFFORDABLE NONE
APPROVED
FABULEUX FASHION 1
STORE
RB KIM’S FASHION 1
APPAREL
SNX FASHION 1
COLLECTION
QUE LE CHIE 1
LABAYAN FASHION 1
BOUTIQUE
MPC ONLINE SHOP 1
CONCEPT HUB 1
STORE 1 1
CRISTELLE 1
STORE 2 1
PRINCESS BOUTIQUE 1 1
DIOKNO C. SARIEGO 1
AILA OVERRUNS 1
MIDSHOP FASHION 1
STORE
AMAZING SKIN 1
BEAUTY SHOP
(BRANCH 2)
FELJEMS HEALTH & 1
BEAUTY PRODUCTS
G-NOR BEAUTY HUB 1 1
G-NOR BEAUTYHUB 1
(BRANCH 2)
AJ MARKETING 1
STORE 3 1
TOTAL 6 1 9 6
 64

HOW MANY PACKS OF REJUVENATING SET DO YOU USUALLY PURCHASE IN

A YEARLY BASIS?
2017 2018 2019 2020 2021
FABULEUX FASHION STORE 5,000 5,000 5,000 5,000 5,000
RB KIM’S FASHION APPAREL 200 300 1,000 1,000 2,000
SNX FASHION COLLECTION 200 200 200 200 200
QUE LE CHIE - - - - 2400
LABAYAN FASHION BOUTIQUE - - - 500 500
MPC ONLINE SHOP - - - - 25
CONCEPT HUB - - - - 500
STORE 1 3,600 3,600
CRISTELLE - 100 100 100 100
STORE 2 - - 500 500 500
PRINCESS BOUTIQUE - - - 650 650
DIOKNO C. SARIEGO 5,000 5,000 5,000 5,000 5,000
AILA OVERRUNS - 150 100 100 1,400
MIDSHOP FASHION STORE - - 5,000 5,000 5,000
AMAZING SKIN BEAUTY SHOP - - - - 500
(BRANCH 2)
FELJEMS HEALTH & BEAUTY - - - - 500
PRODUCTS
G-NOR BEAUTY HUB 50,000 50,000 50,000 50,000 50,000
G-NOR BEAUTYHUB (BRANCH 2) 100 300 500 1,000 1,000
AJ MARKETING 300 300 300 300 300
STORE 3 - 4,000 5,000 5,000 5,000
TOTAL 60,800 65,350 72,700 77,950 84,175

IF REJUVENATING SET WILL BE PRODUCED LOCALLY, ARE YOU WILLING TO

BUY?
 65

YES NO

FABULEUX FASHION STORE 1

RB KIM’S FASHION APPAREL 1
SNX FASHION COLLECTION 1
QUE LE CHIE 1
LABAYAN FASHION BOUTIQUE 1
MPC ONLINE SHOP 1
CONCEPT HUB 1
STORE 1 1
CRISTELLE 1
STORE 2 1
PRINCESS BOUTIQUE 1
DIOKNO C. SARIEGO 1
AILA OVERRUNS 1
MIDSHOP FASHION STORE 1
AMAZING SKIN BEAUTY SHOP (BRANCH 2) 1
FELJEMS HEALTH & BEAUTY PRODUCTS 1
G-NOR BEAUTY HUB 1
G-NOR BEAUTYHUB (BRANCH 2) 1
AJ MARKETING 1
STORE 3 1
TOTAL 20

IF YES, HOW MANY PACKS OF REJUVENATING SET WILL YOU BUY ON A

MONTHLY BASIS?
FABULEUX FASHION STORE 30sets
RB KIM’S FASHION APPAREL 100sets
SNX FASHION COLLECTION 20sets
QUE LE CHIE It depends
LABAYAN FASHION BOUTIQUE 40sets
MPC ONLINE SHOP 5sets
CONCEPT HUB 50 sets
STORE 1 None
CRISTELLE 10 sets
STORE 2 50 sets
PRINCESS BOUTIQUE 55 sets
DIOKNO C. SARIEGO 30 sets
 66

AILA OVERRUNS 20 sets

MIDSHOP FASHION STORE 50 sets
AMAZING SKIN BEAUTY SHOP (BRANCH 2) 50 sets
FELJEMS HEALTH & BEAUTY PRODUCTS 10 sets
G-NOR BEAUTY HUB 30,000 sets
G-NOR BEAUTYHUB (BRANCH 2) 100 sets
AJ MARKETING 25 sets to 50 sets
STORE 3 6,000 sets
TOTAL

Appendix E. Historical data for demand

 67

2021 2020 2019 2018 2017

FABULEUX FASHION STORE 5,000 5,000 5,000 5,000 5,000
RB KIM’S FASHION APPAREL 2,000 1,000 1,000 300 200
SNX FASHION COLLECTION 200 200 200 200 200
QUE LE CHIE 2,400
LABAYAN FASHION BOUTIQUE 500 500
MPC ONLINE SHOP 25
CONCEPT HUB 500
STORE 1 3,600 3,600
CRISTELLE 100 100 100 100
STORE 2 500 500 500
PRINCESS BOUTIQUE 650 650
DIOKNO C. SARIEGO 5,000 5,000 5,000 5,000 5,000
AILA OVERRUNS 1,400 100 100 150
MIDSHOP FASHION STORE 5,000 5,000 5,000
AMAZING SKIN BEAUTY SHOP 500
(BRANCH 2)
FELJEMS HEALTH & BEAUTY 500
PRODUCTS
G-NOR BEAUTY HUB 5,000 5,000 5,000 5,000 5,000
G-NOR BEAUTYHUB (BRANCH 2) 1,000 1,000 500 300 100
AJ MARKETING 300 300 300 300 300
STORE 3 5,000 5,000 5,000 4,000
TOTAL 84,175 77,950 72,700 65,650 60,800

Appendix F. Computation of Projected Demand

Step 1 Different of the most recent and earliest data

2017 12,800
 68

2021 36,175
Difference 23,375

Step 2 Total number of years minus 1

Number of years 5
Less: 1
Difference 4

Step 3 Divide steps 1 by step 2

Difference in step 1 23,375
Difference in step 2 4
Figured to the added to the last demand 5,844

Step 4 Projected demand

2017 (5,000+200+200+5,000+5,000+100+300) 12,800

2018 (5,000+300+200+100+5,000+150+5,000+300+300+4,000) 17,350

2019 (5,000+1,000+200+100+500+5,000+100+5,000+5,000+500
+300+5,000) 24,700
2020 (5,000+1,000+200+500+3,600+100+500+650+5,000+100
+5,000+5,000+1,000+300+5,000) 29,950
2021 ((5,000+2,000+200+2,400+500+25+500+3,600+100+500+
650+5,000+1,400+5,000+500+500+5,000+1,000+300+5,000) 36,175

Appendix G. Computation of Market Share

Market Share = Annual Production

Projected Demand
 69

Year 2023
= 3,000
12,800

= 23%

Year 2024
= 4,000
17,350

= 23%

Year 2025
= 5,000
24,700

= 26%

Year 2026
= 8,000
29,950

= 27%

Year 2027
= 10,000
36,175

=28%

Appendix H. Computation of Price

Current Price: Php 200.00

 70

Annual percentage increase: 3%

Year Price Percentage Forecast Price

2023 200 - -
2024 200 3% 206
2025 206 3% 212
2026 212 3% 219
2027 219 3% 226

Price Study

The business will use market penetration pricing. This strategy sets low price for the

product to attract new customers and penetrate the market. The business will set the price

at ₱200 in every rejuvenating set of organic glow. The price is 67% lower from the price

of the other rejuvenating set which is ₱300. Every year the price of the product will have

an increase of 3% based on inflation rate stated by the PSA (Appendix H).

Appendix I. Packaging
 71

Organic Glow
Rejuvenating Set

Appendix J. Equipment and Tools

 72

Computer Set

Epson single printer

 73

Heat Sealer

Digital scale

Cosmetics thermometer
Electric stick blender

Measuring beaker

Electric hand mixer

 74

Mixing bowl

Glass rod

Big containers

Immersion mixer

Measuring spoon

Appendix K. Furniture and Fixtures

 75

Chair

Storage Rack

StorageRack

Long table

Airconditioner

Appendix L . Notes of Financial Statement

 76

Note 1. Sales
2023 2024 2025 2026 2027
Production Capacity
Total Packs 3,000 4,000 5,000 8,000 10,000
Price per pack 200.00 206.00 212.18 218.55 225.10
Total Revenue 600,000.00 824,000.00 1,060,900.00 1,748,363.20 2,251,017.62
* Operation will start in 2023

Note 2. Cost of Sales

Direct materials per unit is computed as follows:
Direct Materials (per month) Cost
Skin Toner 2,210.00
Whitening Soap 2,780.00
Whitening Cream 3,530.00
Skin Moisturizer 2,270.00
Total Monthly Direct Materials Cost 10,790.00
Divided by number of Packs per month 250.00
Cost per Pack 43.16

Cost of Sales Schedule 2023 2024 2025 2026 2027

Annual Demand 3,000 4,000 5,000 8,000 10,000
Cost of Raw Materials/Unit 43.16 44.45 45.79 47.16 48.58
Direct Materials 129,480.00 177,819.20 228,942.22 377,296.78 485,769.60
Direct Labor 299,520.00 299,520.00 299,520.00 299,520.00 299,520.00
Factory Overhead
Direct Supplies 4,100.00 4,223.00 4,349.69 4,480.18 4,614.59
Depreciation 2,163.08 2,163.08 2,163.08 1,559.75 1,146.00
Total Cost of Goods Sold 435,263.08 483,725.28 534,974.99 682,856.71 791,050.19
 77

Note 3. Salaries

Salaries
No. of
Monthly
Employee 2023 2024 2025 2026 2027
Direct Labor s
Salaries 4 22,100.00 265,200.00 265,200.00 265,200.00 265,200.00 265,200.00
SSS 2,260.00 27,120.00 27,120.00 27,120.00 27,120.00 27,120.00
PhilHealth 600.00 7,200.00 7,200.00 7,200.00 7,200.00 7,200.00
Total Gross Salaries 299,520.00 299,520.00 299,520.00 299,520.00 299,520.00

Note 4. Supplies Expense

Breakdown of Supplies
Quantity
(Annual) Price 2023 2024 2025 2026 2027
Cost of Sales
Protective gloves 50 18.00 900.00 927.00 954.81 983.45 1,012.96
Kitchen towel 20 40.00 800.00 824.00 848.72 874.18 900.41
Disposable Facemask 2 450.00 900.00 927.00 954.81 983.45 1,012.96
Carton Box 50 10.00 500.00 515.00 530.45 546.36 562.75
Soap Stiffener Paper 5 200.00 1,000.00 1,030.00 1,060.90 1,092.73 1,125.51
Total 4,100.00 4,223.00 4,349.69 4,480.18 4,614.59

Operating Expenses
Floor Mop 1 60.00 60.00 61.80 63.65 65.56 67.53
Large Basin 2 280.00 560.00 576.80 594.10 611.93 630.28
Trash Can 3 213.33 640.00 659.20 678.98 699.35 720.33
Total 1,260.00 1,297.80 1,336.73 1,376.84 1,418.14
TOTAL SUPPLIES 5,360.00 5,520.80 5,686.42 5,857.02 6,032.73

Note 5. Operating Expenses

2023 2024 2025 2026 2027
Permits and Licenses 4,000.00 4,000.00 4,000.00 4,000.00 4,000.00
Electricity 54,000.00 54,000.00 54,000.00 54,000.00 54,000.00
Water 6,000.00 6,000.00 6,000.00 6,000.00 6,000.00
Gas and Oil 4,000.00 4,000.00 4,000.00 4,000.00 4,000.00
Rental Fee 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00
TOTAL 88,000.00 88,000.00 88,000.00 88,000.00 88,000.00
 78

Note 6. PPE Lapsing Schedule

Building Improvement Useful Life (in Yrs) 2023 2024 2025 2026 2027
30 80,000.00 80,000.00 80,000.00 80,000.00 80,000.00
80,000.00 80,000.00 80,000.00 80,000.00 80,000.00

Accumulated Depreciation 2023 2024 2025 2026 2027

Accum. Dep. Beginning - 2,666.67 5,333.33 8,133.33 10,933.33
Depreciation 2,666.67 2,666.67 2,800.00 2,800.00 2,800.00
Accum. Dep, End 2,666.67 5,333.33 8,133.33 10,933.33 13,733.33

Useful Life (in Yrs) 2023 2024 2025 2026 2027

Equipment
Computer Set 5 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00
Epson single printer 5 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00
Total 23,000.00 23,000.00 23,000.00 23,000.00 23,000.00

Accumulated Depreciation 2023 2024 2025 2026 2027

Accum. Dep. Beginning - 4,600.00 9,200.00 12,000.00 14,800.00
Depreciation 4,600.00 4,600.00 2,800.00 2,800.00 2,800.00
Accum. Dep, End 4,600.00 9,200.00 12,000.00 14,800.00 17,600.00

Useful Life (in Yrs) 2023 2024 2025 2026 2027

Furniture and Fixtures
Chair 5 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00
Long Table 5 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00
Storage Rack 5 3,000.00 3,000.00 3,000.00 3,000.00 3,000.00
Air conditioner 5 26,500.00 26,500.00 26,500.00 26,500.00 26,500.00
Total 33,000.00 33,000.00 33,000.00 33,000.00 33,000.00

Accumulated Depreciation 2023 2024 2025 2026 2027

Accum. Dep. Beginning - 6,600.00 13,200.00 19,800.00 26,400.00
Depreciation 6,600.00 6,600.00 6,600.00 6,600.00 6,600.00
Accum. Dep, End 6,600.00 13,200.00 19,800.00 26,400.00 33,000.00

Useful Life (in Yrs) 2023 2024 2025 2026 2027

Tools
Heat sealer 3 590.00 590.00 590.00 590.00 590.00
Digital scale 5 1,300.00 1,300.00 1,300.00 1,300.00 1,300.00
Thermometer 3 750.00 750.00 750.00 750.00 750.00
Electric hand mixer 4 755.00 755.00 755.00 755.00 755.00
Measuring beaker 5 560.00 560.00 560.00 560.00 560.00
Electric stick blender 5 850.00 850.00 850.00 850.00 850.00
Mixing vessels 5 420.00 420.00 420.00 420.00 420.00
Immersion blender 5 2,600.00 2,600.00 2,600.00 2,600.00 2,600.00
Big containers 4 900.00 900.00 900.00 900.00 900.00
Glass rod 3 320.00 320.00 320.00 320.00 320.00
Measuring spoon 3 150.00 150.00 150.00 150.00 150.00
Total 9,195.00 9,195.00 9,195.00 9,195.00 9,195.00

Accumulated Depreciation 2023 2024 2025 2026 2027

Accum. Dep. Beginning - 2,163.08 4,326.17 6,489.25 8,049.00
Depreciation 2,163.08 2,163.08 2,163.08 1,559.75 1,146.00
Accum. Dep, End 2,163.08 4,326.17 6,489.25 8,049.00 9,195.00
 79

Appendix M. Supporting Computation for Financial Ratio Analysis

Computation of Return on Investment

2023 2024 2025 2026 2027

Return 51,610.25 227,110.25 414.388.2 953,929.65 1,348,349.29
Investment 7
Net Income 311,610.25 498,720.50 873,108.7 1,787,038.43 1,787,038.43
7
Total Equity 16.56% 45.54% 53.38% 53.38% 43.56%

Computation of Gross Profit Margin

2023 2024 2025 2026 2027

Gross Profit 164,736.92 340,274.72 525,925.01 1,065,506.49 1,459,967.43
Margin
Gross Income 600,000.00 824,000.00 1,060,900 1,748,363.20 2,251,017.62
Revenue 27.46% 41.30% 49.57% 60.94% 64. 86%

Computation of Net Profit Margin

2023 2024 2025 2026 2027

Net Profit Margin
Net Income 51,610.25 227,110.25 414388.27 953,929.65 1,348,349.29
Revenue 600,000.00 824,000.00 1,060,900 1,748,363.20 2,251,017.62
8.60% 27.56% 39.06% 54.56% 59.90%