Feasibility Study

Chapter 1BACKGROUND OF THE STUDYThis chapter presents the introduction and purpose of the study, the history of the project, the proponents, proposed name of business/project, type of business organization and location of the proposed business or project. IntroductionCharcoal is a carbon-containing substance made from wood naturally black and powdering. It is one of the main source of energy particularly for cooking but because of environmental impact of using a charcoal the proponent promted to look for an alternative solution to solve the problem and that is by using a Charcoal Briquette. This Charcoal Briquette are made from agricultural waste such as leaves, twigs , stem, coconut husks, corn cobs, rice hull and other farm waste. The used of charcoal briquette can reduced the cutting of wood to produced charcoal to augment the basic consumption of household and other domestic enterprises. This proposed business will be beneficial not only the proponents, people live in Quisao but also to our environment. Now a days , theres a lot of waste in environment that are not use and serve only as a pollution in our community thats why our Government became more aggressive and environmental conscious and thats the reason why Charcoal Briquette want to establish in the market. The objectives of this Business is to lessen the waste in our society and to found an alternative fuel for cooking, to provide employment to the people, to supply the needs of the costumer, to reduced cutting/using wood from the natural resources and most specially to provide additional source of income. History of the Project The charcoal briquette was first invented and patented by Ellsworth B.A. Zwoyer of Pennyslvania and was produced by the Zwoyer Fuel Company. The process was popularized by Henry Ford, who used wood and sawdust by products from automobile fabrication as a feedstock. Ford Charcoal went to become the Kingsford Company.The original method for making charcoal briquettes is very traditional, like for example in Africa. Africans walked for several kilometers to find wood charcoal that has been baked in the forest. They carried it home on their backs in cloth bags. They then collected the charcoal dust that had accumulated in the bottom of the bags and they mixed it with clay.They made small balls of this mixture in the palms of their hands and then dried them in the sun. These balls provided an extra source for combustion. Already at the time, charcoal dust today called small coal, was collected and mixed with binder.Since then, the manufacturer of charcoal briquettes has change dramatically with the appearance of new industrial technologies.This natural product is the result of the agglomeration of small wood charcoal with an alimentary binder (wheat flour) and water.Briquettes look like the old coal nuts that were used in domestic stoves.Their company CARBO-BRIQ, specialized in the manufacture of charcoal briquettes creates high-end products essential for a successful barbecue.Today, charcoal briquettes are used particularly in Northern Europe. The Americans also use them for grilling meat on their barbecues.In France, charcoal briquettes are not commonly distributed but demand is increasing. The proponent conceptualize this idea because they observe that our country have experience lots of disaster such as flashflood , landslide and etc. and that is because by cutting of woods in our country in order to provide household, furniture and charcoal so we prompted to produce an alternative fuel for cooking in order to decreased or reduced cutting woods in our natural resources and that is by providing charcoal briquette in market in that could help our Mother Earth to lessen the disaster in our country.Project Proponents Table 1Project Proponents of JM Charcoal Briquette

NAMECITIZENSHIPRESIDENCECONTRIBUTION

Maria Theresa C. SigaFilipinoQuisao, Pililla, Rizal50 %

Angelique B. VirayFilipinoTanay,Rizal50 %

This Project study will be in the form of Partnership were in the proponents will contribute money base on their respective share.Proposed Name of Business The name of the firm will be name as JM Charcoal Briquette. This name is used for the easy familiarization of the business. The J stand for Jhelic the nick name of one of the proponents, and the M is the initial of Maria Theresa. Charcoal Briquette means a carbon-containing substance made from agricultural waste used as fuel to start a fire,

Emblem/Logo

Figure 1Emblem of JM Charcoal Briquette

The logo of our business named JM Charcoal Briquette show the uniqueness and creatively of our product. We choose a lively pigment to catch the attention and interest of our customer. By using that logo, our business can be easily recognized. Type of Business Organization The form of business organization that the proposed business will be used is partnership. An association of two or more individuals joining together as a co-owner to operate a business for profit. The proponents can bind themselves to contribute money, property or industry to a common fund with the intention of dividing the profits among themselves. The proponents used this because it is an appropriate form in our productProject LocationThe proponent decided to establish the business at Barangay Quisao, Pililla, Rizal It is one of the four barangays which are outside the poblacion, and is about 8km. from the Town proper of Pililla and aside from having a highest population it also have the most number of household that using a charcoal in their cookingThe proposed location is a good option in establishing the business because of the factor that we consider; it is along the highway were every residence can easily locate and as well as those people who may pass by.

Figure 2Project Site

Chapter 2MANAGEMENT AND PERSONNEL FEASIBILITYThis chapter presents the proposed organizational structure, number of personnel, their duties and responsibilities and qualification, management proposal, policies and form design.Organizational System and StructureThe organizational structure that the proponent will use is the line type organization. This type of structure is the simplest type among all other organizations structures because now a days it is well practiced by different small business in the country. It serves as training for them at first and will promote a quick development in the production operation of the business. Line type organization structure will help the manager as well as the seller and workers to perform their task well according to their position, duties and responsibilities as a part of the business.

Manager

Cashier/ Seller

Workers

Figure 3Line Organizational ChartPersonnel (Administrative)

The Charcoal Briquette considers the personnel as the important factor that a business has. Employee or workers must be organize well according to the superior and down to the subordinates for the business to make the operation to be done well. The firm will have 1 manager to supervise all the operation of the firm, a cashier and seller who will asses the costumer and in charge of money transaction and most of all workers who are willing to work for the production of the product.

Table 2Proposed Personnel/Workforce of JM Charcoal Briquette

PositionProposed numberProposed compensationJob descriptionJob specification

Manager13,500-Will manage all aspect of the business operation. The decision maker of the firm.-Must be a graduate of bachelor of science in business Administration and other related course.

Workers/ Delivery boy33,000 - the one who will manage the product and bring it on respective area -Undergraduate can also be included.-Have knowledge on driving, Patience.

Seller/ Cashier12,500- one who will entertain and assist the customers.-in charge in money and financial transaction-Good in sales talking, has a pleasing personality. - trustworthy

Management ProposalThe management will run the business according to democratic leadership. In this style, the head or the manager will provide instruction first or will initiate and provide training for the workers so that the workers of the production will easily know what should be do and afterwards the workers will perform the tasks properly with regards to his/her job.Administrative PoliciesIt is important to have policies in the business. It is use as guidelines to avoid argument that can affect the business.In hiring personnel, the manager or the owner is responsible in choosing the right employee that suited for the job. The applicant must have resume and application form as needed requirement for the job.The worker hour of the seller and the manager will be 8:00 am to 12:00 pm and will resume at 1:00 pm to 5:00 pm. The workers are responsible to clean the surroundings before and after the production to avoid rusty of the machineries. The management will be liable if there will be unexpected accidents happen to worker inside the firm.System and Form DesignForm 1 Application FormThis form tells basically the applicants personal data, educational attainment and most importantly, the applicants work experience and relative trainings.Form 2 Time RecordUpon hiring of the employee, he or she is required to have his/her daily time record to monitor his/her time in and time out for each of his working day.Form 3 Resignation FormThis form is used when an employee resign his/her job. It includes the date of his/her resignation, reasons for resignation, and survey of his/her feedback to the company.

Legal Requirements Before the normal operation of the business the owner must secure or necessary permits to facilitate the processing of beginning the business.The proponents will secure the following permits before construction:1. Mayors Permit2. Sanitary Permit3. Building Permit 4. Fire Safety Permit

Before the Business can operate, they have to secure permits and licenses to various government organization:1. Community Tax Certificate2. Barangay Business Permit 3. Department of Trade and Industry4. Bureau of Internal Revenue Certificate of Registration5. Municipal Business Permit

Chapter 3MARKETING FEASIBILITYThis chapter will pinpoint your business general to specific feasibility. It will describe your market and analysis of the past, present and future demand and supply situations of your particular product or service. If the conditions are feasible, then a check of the marketing practices of the similar business is studied as a guide to design business marketing strategies. Market DescriptionBarangay Quisao, Pililla is the proposed location of JM Charcoal Briquette. It has approximately 65km. East of Manila. It is the biggest among the 9 barangays in Pililla . In terms of population with the total of 13,284 with 2,387 household as of 2013. It is one of the four barangays which are outside the poblacion, and is about 8km. from the Town proper of Pililla.The reference of Barangay Quisao are cross-section professionals, overseas, work, office employees, factory worker, farmers and fisherman.The potential consumer of JM Charcoal Briquette are the lower and middle class society which is 45% and 40% respectively. However the proponents use only 45% which is the lower class to compute the potential consumer. The firm will market its product to aid the people who cannot avail to buy LPG Gas. The product will market through direct and indirect method.

Market DemandThe target customer are those people belongs to lower class in which 45% of population belongs in this status.In getting the possible demands for the Charcoal Briquette the proponents will rely on the population of household presented by the Municipality of Pililla which is 2387. They use the Index of Buying Power Method.Target Market = lower class (45% of population) Total Household Population = 2387 (2387)x(45%) = 1074 familiesFrom the target market of 1074 families it will multiply to the result of the survey who says in favor to buy Charcoal Briquette with the percentage of 75% to get the possible demand.(1074)x(75%) = 806 potential consumerIn getting the estimated demand of Charcoal per pieces for 2009 the potential market will multiply to the average buying of Ordinary Charcoal per families per year.According to the survey, the average consumption of Charcoal daily is 3 multiply by 365 the result 1,095 packs was the average consumption per year per families.(806)x(1,095) = 882,570

To get the demand of the following year, the proponents multiply the population growth rate (3.60%) to the demand for 2013 and the answer (31,773) will be deducted to the demand for 2013 (882,570). The demand for the 2012 is (850,797) same procedure to the following years.Table 3Estimated Demand of Ordinary Charcoal for the Last Five (5) Years

YEARESTIMATED DEMAND ( per packs)

2009762,179

2010790,642

2011820,168

2012850,797

2013882,570

The table shows the estimated demand of Ordinary Charcoal for the last five years.It can be seen in the table that in the last five years the demand is expected to increase by 3.60% yearly. The 3.60% increase yearly used is based on the census. In getting the demand for the next five years, the proponents used Arithmetic Straight Line Method wherein the demand for 2013 (882,570) was deducted to the demand in 2009 (762,179). The result (120,391) was divided by 5 since it was in five years. The outcome (24,078) will be added to the following years.Table 4Projected Demand for the Next Five Years

YEARPROJECTED DEMAND

2014906,648

2015930,726

2016954,804

2017978,882

20181,002,960

The table shows the projected demand of JM Charcoal Briquette for the Next Five Years. It can be seen in the table that in the next first year of projected demand is 906,648 and it is expected to increase by 24,078 yearly.

Market SupplyIn getting the possible supply for the JM Charcoal Briquette the proponents will rely on the results of the survey on how many packs of a charcoal they sell per day and that existing supplier are mentioned below. They use the Index of Buying Power Method.Table 5Suppliers of Ordinary CharcoalNameAddress

Emelita SigaBarangay Quisao , Pililla , Rizal

Mario PalisocBarangay Quisao , Pililla , Rizal

Gina PolandBarangay Quisao , Pililla , Rizal

Milanio AnimasBarangay Quisao , Pililla , Rizal

Boy GarciaBarangay Quisao , Pililla , Rizal

Dory VidanesBarangay Quisao , Pililla , Rizal

Rea VillagonzaBarangay Quisao , Pililla , Rizal

Others Supplier of Barangay Quisao, Pililla Rizal

Table 6Quantity SuppliedAverage Packs Sold DailyAverage Packs Sold YearlyNumber of Existing SuppliersTotal Quantity Supplied (packs)

3512,77520255,500

The table presents the quantity supplied by the existing retailer stores.In getting the quantity supplied, the average packs daily which is 35 was multiplied by 365 days resulting to 12,775. The number of retailer store was multiply to 12,775 in order to get the total quantity supplied in packs which is equivalent to 255,500To get the supply of the following year, the proponents multiply the population growth rate (3.60%) to the supply for 2013 and the answer (9,198) will be deducted to the supply for 2013 (255,500). The supply for the 2012 is (246,302), same procedure to the following years.Table 7Estimated Supply for the Last Five YearsYEARESTIMATED SUPPLY

2009220,647

2010228,887

2011237,435

2012246,302

2013255,500

The table show the estimated supply of Charcoal for the last five years.It can be seen in the table that in the last five years the supply is expected to increase by 3.60% yearly. The 3.60% increase yearly used was based from the census.In getting the supply for the next five years, the proponents used Arithmetic Straight Line Method wherein the supply for 2013 (255,500) was deducted to the demand in 2009 (220,647). The result (34,853) was divided by 5 since it was in five years. The outcome (6,971) will be added to the following years.Table 8Projected Supply Figures

YEARPROJECTED SUPPLY

2014262,471

2015269,442

2016276,413

2017283,384

2018290,335

The table shows the Projected Supply of Ordinary Charcoal for the Next Five Years. It can be seen in the table that in the first year of Projected Supply is 262,471 and it is expected to increase by 6,971 yearly.

Demand and Supply AnalysisTable 9Demand and Supply Analysis

YEARProjected Demand

Projected Supply

D-S Gap

PercentUnsatisfied

2014906,648262,471644,17771%

2015930,726269,442661,28471%

2016954,804276,413678,39171%

2017978,882283,384695,49871%

20181,002,960290,335 712,62571%

Figure 4Market Share

Marketing PlanThis is a framework that entails the techniques or methodologies in selling the product. It includes such as manufacturing cost, market place, competition, market condition and quality of a product. Marketing StategiesProduct Mix Strategies JM Charcoal Briquette offers a Charcoal Briquette. This Charcoal Briquette is distributed per packs where in 1packs there is 15 pcs. of charcoal. The proponents choose to package it in a paper bag to make it more presentable to the customer. Pricing Mix StrategiesPricing is the process of determining what a company will receive in exchange for its product produced. The factors that include in pricing are the production cost, raw materials and other needs in the production process. The proponents decide to sell the product with the cost of 10.00 per 1packs where in there are 15 pcs. of charcoal briquette.Promotional Mix StrategiesJM Charcoal Briquette is a new proposed business so it must provide promotional strategies for the opening of the business. The proponents will promote their business through word of mouth, they also have fliers and tarpaulin in able to recognize what kind of product that the proponents offer.

Place Strategies

Retailer JM Charcoal Briquette In direct

Customer DirectFigure 5Channel of Distribution

This figure shows the channel of distribution of JM Charcoal Briquette. The channel of distribution will be the manner of direct and indirect buying.Production of JM Charcoal Briquette will be located at Upper Barak Barangay Quisao, Pililla, Rizal and considered to be a strategic location for a business because it is far from the the people.

Sales ProjectionThis portion should present the proposed sales of the product in terms of quantity and in monetary value for the next five years

Table 10Sales Projection

Products by productsYear 1Year 2

Quantity per packsUnit PriceSales RevenueQuantityUnit PriceSales Revenue

Charcoal briquette 10.00453,320.0010.00498,650.00

Year 3Year 4

QuantityUnit PriceSales RevenueQuantityUnit PriceSales Revenue

10.00548,510.0010.00 603,360.00

Year 5

Quantity Unit PriceSales Revenue

10.00663,690.00

Chapter 4PRODUCTION AND TECHNICAL FEASIBILITYThis chapter present the details of the proposed business, products or service/s; how they will be produced (manufacturing) using their own location, buildings and facilities, capacity and lay-outing proposals; what will be the specific machineries and equipments, raw materials and manpower requirements, utilities (water, electricity) waste disposal management and production system.ProductsCharcoal Briquette is a block of flammable matter used as alternative fuel for cooking. It is also a carbon containing substance made from coconut shells, corn cobs, dried twigs and dried leaves. Its common and Scientific name of charcoal is Carbo-Lignis and Carbo-Vegetalis. This Charcoal Briquette serves as alternative fuel for cooking in case of the government banned the use of Wood Charcoal and because this product is made from agricultural waste you dont need to cut woods to provide charcoal.This charcoal Briquette is different from wood charcoal because this is more heavy and it provide a more stable burn.

Example Product :

Figure 6Example Product

Technical Process

DRYING CHOPPING

SORTING

DRIED TWIGS, COCONUT SHELLS, CORN COBS. RICE HULLCARBONIZING DRUM METHOD

DRYING OF BRIQUETTESBRIQUETTINGMIXING WITH BINDERSHRENDDING & GRENDING

MARKETING AND UTILIZATION

PACKAGING Figure 7Production ProcessPlant SizeThe area to be used for the operation consumes an enough space of 548 Square Meters. Its space is enough for the production of Charcoal Briquette. Project LayoutThe proponents will use one story building for the Production Area and they will rent a small space for their Main Store. The production will be located at the Upper Barak Barangay Quisao, Pililla,Rizal while the main store will be located at JP.Rizal Quisao,Pililla,Rizal.

TO TANAY TO JALA-JALA Sitio BarakUpper Barak Quisao, Pililla, Rizal

LEGEND :

HouseStore

Buss. Location

Church

Rice Field River Vacant Lot

Figure 8Project Location of JM Charcoal BriquetteProduction ScheduleThe table shows the operation schedule cycle of the production of JM Charcoal Briquette.Table 12Production Schedule of JM Charcoal BriquetteDescription of ActivitiesNumber of hoursMan Power Requirement

Sorting Hours1

Chopping1 hours1

Carbonizing1 hours1

Shrending and Grending1 hours1

Mixing Hours1

Briquetting1 hours1

Drying1 Hours1

Packaging2 hours3

Plant Layout

LEGEND : Chair

N Storage Room Chair

Table

Office Room Bowl Window

J MCHARCOAL BRIQUETTEFaucet

C.RK. BowlMachines

Figure 9Lay-out of Building and Facilities During the pre-operating period the proponents must considered the layout and design of the production building. The JM Charcoal Briquette will include open area building for the production. This building will need furniture and fixture, equipment and machineries. Building and FacilitiesThe proponents will use an open area building for the production of Briquette and will rent a small space for the their main store at JP Rizal Street Quisao,Pililla,Rizal while the production area will be located at Upper Barak Barangay,Quisao,Pililla,Rizal. They will spend Php 568, 650 for the construction of production building.

25 M

11 MWorking Area

22 M

6 MStorage RoomRaw Materials

3 M

2 M Parking Lot

8 M4 M4 M7 M

Figure 10Floor Plan of Production Area

Machineries and Equipment RequirementsTable 13List of Machines and Equipment to be used

Name of machineUnit CostQuantityTotal

Binder 2,00012,000

Grinder/Chopper

30,000130,000

Dryer

30,000130,000

Mixer

4,00014,000

Briquettor

20,000120,000

Wall Fan

8001800

Weighing Scale

5001500

105,300

List of Furniture to be used

Table 14List of Furniture to be used

Name of Furniture & FixtureUnit CostQuantityTotal

Cabinet

150034500

Chair

120011200

Table

2,95012,950

8,650

Supplies and Raw Materials Requirements

Table 15Supplies and Raw Materials Requirements

Name of Raw Materials and SupplyDescriptionUnit CostQuantity Daily CostYearly Cost

Coconut ShellsPer sacks252 sacks5018,250

harinaPer kilo301 kilo3010,950

cornstarchPer kilo304 kilo12043,800

Packaging Materials :

Paper BagPer kilo252 kilo50

StaplerPer Box251 box25

275100,375

Manpower RequirementsTable 16Manpower Requirements

PositionFunctionQuantityQualification/s

Manager

The one who looks for the performance and behavior of the employees in their tasks. Handle cash, budgeting disbursement and shall be responsible for the auditing and computing expenses and revenue of the business.1Must be graduate of Business Administration (any major) 25 years old and aboveKnowledgeable in promoting the business .

Sales ClerkThe one who will entertain and assist the customers.1Good in sales talking, has a pleasing personality.

Delivery BoyThe one who will manage all the product and bring it on respective area.1Have knowledge/ experience on driving, trustworthy

WorkerIn charge of the production. Produce the raw materials into a unit of product.3Patience and trustworthy Undergraduate can also be included.

Utilities RequirementsTable 17Utilities Requirements

UtilitySource/sEstimated Consumption in pesoTotal

WaterPililla Water District225x122,700

ElectricityMeralco1,500x1218,000

20,700

Waste and Waste Disposal MethodSince the business is production of charcoal the only waste that will produced is the left over carbon pine. This left over carbon pine will be clean in a proper way through throwing of water to avoid spreading of waste.

Chapter 5Financial Feasibility

This chapter presents the project cost, financiers, financial assumptions, projected financial statements for the next five years and the analysis of the financial statements.Total Project Cost The JM Charcoal Briquette needs a total capital requirement of the Php. 1,900,000 which includes the total projected cost such as land, building, machineries and equipment , furniture and fixture, inventories, office supplies, permit, fees and licenses and cash on handTable 18Total Project Cost of JM Charcoal BriquetteItem/DescriptionAmount/Cost

Land 246,600

Building 568,650

Machineries & Equipment105,300

Furniture & Fixtures9,850

Office Supplies264

Rent Expense12,000

Organizational Cost4,665

Utility Expense20,700

Working Capital100,375

Cash on hand831,596

Total Project Cost1,900,000

Financiers The proposed project will have an initial capital of Php: 1,900,000 that will come for the personal fund of the partners.Table 19Partners Capital ContributionNameInvestment

Ma. Theresa C. Siga950,000

Angelique B. Viray950,000

TOTAL1,900,000

This table presents the initial contribution of each partner. It can be seen that Ma.Theresa C. Siga and Angelique B. Viray will both contribute 50% on the initial capital of the business. The distribution of the income will be based on the percentage of ownership of the partners.Financial Assumptions This chapter present the proponents assumptions in preparation of projected financial statements such as :Increase in sales 5%Cost of Good Sold 3%Operating cost as increases in salary and other operating expense to increase 3% Table 20Balance SheetPre-Operating PeriodASSETS

Current Assets

Cash on hand831,596

Stocks100,375

Supplies264

Prepaid Expenses37,365

TOTAL CURRENT ASSET969,600

Non-Current Assets

Land 246,600

Building 568,650


Furniture and Fixture9,850

Total Fixed Assets930,400

Total Assets1,900,000

CAPITAL

Ma. Theresa S. Siga950,000

Angelique B. Viray950,000

Capital Distribution1,900,000

Table 27Cash Inflow

Beginning Balance

Cash ContributionsPhp.1,900,000

Total Cash InflowPhp.1,900,000

Less: Cash Disbursements

Land246,600

Building568,650


Furniture and Fixture9,850

Organizational Cost4,665

Supplies Expense264

Rent Expense12,000

Advertising Expense2,700

Travelling Expese30,000

Utilities Expense20,700

Working Capital100,375

Total Cash Outflows1,101,104

Ending Cash Balance798,896

Pre Operating Cash Flow51

JM Charcoal BriquetteProjected Income Statement for the Five Year 2014-2018For the ended December 31, 2013

ScheduleYear 2014Year 2015Year 2016Year 2017Year 2018

Sales 644,180676,390710,210745,720783,010

Less: Cost of Sales 103,386.25 106,487.84109,682.48112,972.95

116,362.14

Gross Sales540,793.75569,902.16600,327.52632,747.05666,647.86

Less: Operating Expenses

Salaries & WagesA191,580197,327.40203,247.22209,344.64215,624.98

Utility ExpenseB21,32121,960.6322,619.4423,298.0223,996.96

Supplies ExpenseC271.92280.08228.48297.13306.04

Organizational FeesD650650650650650

SSS Contribution2,6522,6522,6522,6522,652

Philhealth Contribution100100100100100

Travelling ExpenseE30,90031,82732,781.8133,765.2634,778.22

Advertising/Propotional ExpenseF2,7812,864.432,950.763,039.283,130.46

Depreciation Expense G60,236.7060,236.7060,236.7060,236.7060,236.70

Total Operating Expense330,886.62336,039.63344,211.65352,628.84361,298.53

Net Income Before Interest & Taxes209,907.13233,862.54256,315.87280,118.21305,349.33

Less: Income Tax (30%)62,972.1470,158.7676,894.7684035.4691,604.80

Net Income After Interest & Taxes146,934.99163,703.78179,421.11196,082.75213,744.53

JM Charcoal BriquetteProjected Cash Flow Statement for the Five Year from 2014-2018

For the period ended December 31, 2013

Pre OperatingYear 2014Year 2015Year 2016Year 2017Year 2018

Beginning Cash Balance 1,900,000.00798,896894,614.241,002,700.341,124,835.241,261,913.20

Add Sales:644,180676,390710,210745,720783,010

Total Cash Available1,900,000.001,443,0761,571,004.241,712,910.341,870,555.242,044,923.20

Less: cash Disbursement

Cost of sales100,375103,386.25106,487.84109,682.48112,972.95116,362.14

Salaries & Wages-191,580197,327.40203,247.22209,344.64215,624.98

Utility Expense20,70021,32121,960.6322,619.4423,298.0223,996.96

Supplies Expense264.00271.92280.08288.48297.13306.04

Organizational Expense4,665650650650650650

SSS Contribution-2,6522,6522,6522,6522,652

Phil health Contribution100100100100100

Travelling Expense30,00030,90031,82732,781,8133,765.2634,778.22

Land 246,600246,600246,600246,600246,600246,600

Building 568,650568,650568,650568,650568,650568,650

Machineries and equipment105,300

105,300

105,300

105,300

105,300

105,300

Furniture and Fixture9,8509,8509,8509,8509,8509,850

Advertising Expense2,700-----

Depreciation Expense-60,236.7060,236.7060,236.7060,236.7060,236.70

Rent Expense12,00012,36012,730.8013,112.7213,506.1013,911.28

Income tax125,003.89134,051.46142,704.25151,819.23161,422.08

Cost of Sales100,375103,386.25106,487.84109,682.48112,972.95116,362.14

Total Cash Disbursement1,101,104548,461.76568,303.90588,075.10608,642.04630,040.40

Ending Cash Balance798,896894,614.141,002,700.341,124,835.241,261,913.201,414,882.80

JM Charcoal BriquetteProjected Balance Sheet for the Five Year period from 2014-2018For the period ended December 31, 2013

Year 0Year 2014Year 2015Year 2016Year 2017Year 2018

Assets

Cash on Hand831,596894,614.241,002,700.341,124,835.241,261,913.201,414,882.80

Stocks100,375103,386.25106,487.84109,682.48112,972.95116,362.14

Supplies 264271.92280.08288.48297.13306.04

Prepaid Expense37,36538,485.9539,640.5340,829.7542,054.6443,316.28

Total Current Asset969,6001,036,758.361,149,108.781,275,635.951,417,237.931,574,867.26

Non-Current Asset

Land 246,600246,600246,600246,600246,600246,600

Building 568.650568.650568.650568.650568.650568.650

Machineries & Equipment105,300105,300105,300105,300105,300105,300

Furniture and Fixtures9,8509,8509,8509,8509,8509,850

Less: Accumulated Depreciation060,236.7060,236.7060,236.7060,236.7060,236.70

Net Fixed Assets930,400870,163.30809,926.60749,689.90689.453.20629.216.50

Total Assets1,900,0001,906,921.661,959,035.382,205,325.852,106,691.132,204,083.78

Capital

Owner A950,000890,958.89912,491.96941,310.80977.435.951,021,330.84

Owner B950,000 890,958.89912,491.96941,310.80977.435.951,021,330.84

Income Tax125,003.89134,051.46142,704.25151,819.23161,422.08

Total Owners Equity1,900,0001,906,921.661,959,035.382,025,325.852,106,691.132,204,083.76

JM Charcoal BriquetteStatement of Changes in Owners Equity for the first Five Years

Owner AOwner B

Year 1

Capital Contribution890,958.89890,958.89

Add: Net Income for the year146,934.99146,934.99

Total Capital1,037,893.881,037,893.88

Year 2



Total Capital1,076,195.741,076,195.74

Year 3



Total Capital1,120,731.911,120,731.91

Year 4



Total Capital1,173,518.701,173,518.70

Year 5

Capital Contribution1,021,330.841,021,330.84


Total Capital1,235,075.371,235,075.37

Financial Analysis Ratio analysis express the relationship among selected items of financial statements.

Test of Profitability RatioTable 28Gross Profit MarginYear

20142015201620172018

Gross Profit

540,793.75569,902.16600,527.52632,747.05666.647.86

Sales

644,180676,390

710,210

745,720

783,010

Gross ProfitMargin0.840.840.850.850.85

Gross Profit Margin measures the percentage of sales remaining after the firm paid its good. It can be seen that the gross profit margin is better because the ratio from 2014 up to 2018 is 85 %.

Table 29Operating Profit Margin

Year

20142015201620172018

Operating Income

416,679.63446,838.21475,680.82506,064.12538,073.61

Sales

644,180676,390

710,210

745,720

783,010

OperatingProfit margin0.650.660.670.680.69

Operating Profit margin measures the percentage of each sales remaining after all operating cost and expenses are the deducted. It can be seen that the operating profit margin of the firm is decreasing over the years.Table 30Net Profit MarginYear20142015201620172018

Net Income

146,934.99

163,703.78

179,421.11

196,082.75

213,744.53

Sales

644,180

676,390

710,210

745,720

783,010

Net IncomeMargin0.23

0.24

0.25

0.26

0.27

Net Profit Margin shows after tax profit per peso value of sale.

Table 31Return on AssetYear20142015201620172018

Net Income

146,934.99

163,703.78

179,421.11

196,082.75

213,744.53

Total Assets

1,906,921.66

1,959,035.38

2,025,325.85

2,106,691.13

2,204,083.76

Return on Assets0.080.080.090.090.10

It measures the ability to maximize the use of resources to generate profit. It shows the percentage was decreasing because the assets were depreciated.Table 32Return on Investment Year20142015201620172018

Net Profit

146,934.99

163,703.78

179,421.11

196.082.75

213,744.53

Total Investment1,900,0001,900,0001,900,0001,900,0001,900,000

ReturnOn Investment0.080.090.100.100.11

Total Investment is based on the balance sheet increasing yearly, then the net income has small percentage if increase. The 2014 return on investment is high because the total investment in 2013 unaltered that is why the net income of 2013 is subdued of the following years. It can be seen in the table the Return on Investment decrease with 5 years.

Pay Back Period

Initial Investment Average Cash Flow

1,900,000= 1,139,789.16 = 1.7The capital Investment shall recover within 1 year and 7 months

Discounted Cash

Chapter 6

SOCIO-ECONOMIC FEASIBILITY

This chapter present the contribution to the government revenues, grow of financing specially from government institution should be grated toward not only the profit generation but social economic benefits this portion of the study will serve as an did in determining the socio economic contribution the project can offer.

To the researcher For the researcher or the proponents it is a big help for us because we can gain profit and learn more about the said business.To the community The contribution of this proposed business to the community it is can supply or provide a charcoal briquette specially in case of the government warn the used of the ordinary charcoal because it have a environmental impact in our environment , as from that it also provide employment to other people. The employee will receive salary and it will be help to them to improve their standard of living, aside from monetary benefit, we should also give the proper training to improve their ability.To the country The business taxes, as well as the employee taxes. The collected fees will help in sustaining local project and activities. It can also help to the country to help their subordinates which is the lower class to have other sources of charcoal because they can afford to buy LPG.Chapter 7

Project implementation and timetable

This chapter present presents the pre-operating phase that includes the schedule of activities and time frame

ActivityNo. of Months

Formulation of Business Plan2

Raising of Funds3

Procurement of business permit and other legal document1

Hiring of Personnell1

Purchasing of Materials and Land Improvement3

Acquisition of Equipment 1

Start of Normal Operation1

The Gantt Chart

The Gantt chart only simple presentation of different activities of your projects pre-operating period. Thus, it may it my be helpful to the management to determine the date when certain status of pre-operating activities should be made.

TableCalendar of Activities

Activities JulyAug.Sept.Oct.Nov. Dec.Jan.Feb. Mar.Apr.May.Jun.

Formulation of Business Plan

Raising of Funds

Procurement of business permit and other legal document

Hiring of Personnell

Purchasing of Materials and Land Improvement

Acquisition of Equipment

Start of Normal Operation

Chapter 8Conclusion and Recommendation

This chapter includes the perceived problems, conclusion and recommendations of the researcher.

Perceived Problems Everyone of us have encountered problems as well as the business, either small or large they experience problems during the operation. It is fact that no matter how things are planned problems arise such as:1. Increase in the price of raw materials2. Business of the same kind3. Customer complaints

Conclusions The proposed business requires an amount of capital and resources that are possible in the present situation, the proper application of management, marketing strategies and production will be a lot helpful for the feasibility of the proposed projectRecommendation To eliminate or at least minimize the effects of problems perceived by the proponent, they recommend the following situation.1. The business will look for alternative of the high cost raw materials to avoid huge changes in the price of the product that the business offer but will not effect the quality of it.2. Competition will serve as an opportunity for the business to have quality service and products for customer. This will encourage costumer to come back on the place again and again. 3. Proper orientation for the employees should be done to provide good customer relations.

Feasibility Study

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