Chapter I

Introduction

I. Background of the Study

Food is the primary necessity in the world. According to the report, Filipinos spend
around 37% of their income on food, which is the largest portion of their budget
(http://fitzvillafuerte.com/infographic-the-spending-habits-of-filipinos.html, 2015). Huge amount
of money circulates in the economy for that primary necessity. Today, where improved
technology and innovations are rising, people become particular, not only for the things that will
satisfy them but also for the factors that will satisfy more than just their needs.
Food production has impacted our society significantly today and has changed a great
deal of things in our lives. The emergence of food production industry has been a large break
for companies and entrepreneurs to grab the opportunity of global need of food. From small up
to large businesses like specialty stores and restaurants, manufacturing and processing has
arisen, the business did establish an innovation in every product in every product in order to
give the consumers an improved product. (http://fitzvillafuerte.com/infographic-the-spending-
habits-of-filipinos.html, 2015)
Baked goods face bright prospects in the medium term. Demand for these products will
be driven by the improvement in the Philippine economy and the faster paced lifestyles of
Filipino consumers. The stronger performance of the Philippine economy helped to fuel the
consumption of baked goods in 2014. It is expected that retail current value sales will jump by
6%, as Filipinos are starting to consume bread, pastries and cakes more frequently. This is
especially noted that amongst busy middle income urban consumers, who prefer to have
sandwiches instead of rice and other dishes in order to save time on food
preparation(http://www.euromonitor.com/bakery-in-the-philippines/report. April, 2014).
As the Philippines experiences better economic growth, consumers incomes will
improve and lead to more robust demand for baked goods. Faster paced lifestyles will stimulate
the consumption of convenience products such as baked goods. The opening up of more
retailers and bakeshops across the country will further improve the penetration of packed or
industrial brands (http://www.euromonitor.com/bakery-in-the-philippines/report. April, 2014).
II. Project Proponents
The project proponents are of six members. The following are their names and some
information about them:

Name Address Nationality Classification Partners Percentage

of Partner Contribution
Aranda, Mc #385 Tatang Filipino General 30 000 20%
Ace C. Exequiel
Cmpd. Talon
I, LPC
Arriesgado, #70 Laong Filipino Limited 24 000 16%
Irish G. Cmpd.
Almanza I,
LPC
Bautista, Ann Blk 3 Lt 2 Filipino Limited 24 000 16%
Lorenz R. Urbanville,
Talon III,
LPC
De Jesus, #035 Filipino Limited 24 000 16%
Mylene A. Gonzales
Cmpd.
Almanza I,
LPC
Madlangbayan, #363-CNorth Filipino Limited 24 000 16%
Cris Rigiel O. 7th Angela
Village, Talon
IV, LPC
Mendoza, Julie #701 Int. Filipino Limited 24 000 16%
Anne Mae S. Tramo St.
Manuyo I,
LPC
III. Proposed Name of the Business
The name deliciozo is an Italian word for delicious and pizza cupcake came from
the name of our product itself. It was suggested by one of our proponents for she thinks that this
name is very catchy yet simple that could attract the attention of the customers.

IV. Type of Business Organization

The form of business organization is partnership. This type of business organization was
chosen because it is easy to form for the reason that it requires less legal requirements. In
addition, partners will be able to contribute their skills and different expertise to the business.
The kind of partnership that we decided to form is a limited partnership whereasat least
one partner is a general partner.

V. Location of the Business

The location of the business is Blk 142 Baluyots Place,Angela Avenue, Angela Village,
Talon IV, Las Pias City. Baluyots Place is a commercial building divided into four commercial
spaces where each has a measure of 14x16 square meters.
The accessibility and security of the place are perfect for food business. It is visible from
the road where residents living in the area pass through. The security is assured for both
business and customers.
The lavatory area has four well-functioning faucets for the main source of water supply.
Used water from the sink will pass the water pipes connected to it and go to the drainage
system of the area.
Three power outlets can be used as the main source of electricity for the utility and
production. There is a circuit breaker to avoid fire when short circuit occur. Four fluorescent
lights and two built-in cabinets are also available to use.
VI. Statement of the Problem
The general problem of the study is to determine the feasibility of a food manufacturing
business with the product pizza cupcake.
Specifically, it aims to evaluate and analyses the following specific questions:

Market Aspect
1. Who would be the target market?
2. What will be the projected demand and supply of the target market?
3. What will be the projected market share?
4. How will the product be promoted?
5. What will be the projected sales?
Management Aspect
1. What will be the form of ownership?
2. What will be the management style?
3. How many employees would be needed on the business operation?
4. What will be the requirements and qualifications, duties and responsibilities, salaries and
benefits of the business manpower?
5. What will be the flow of authority and policies that will serve as guidelines for the entire
business?
Technical Aspect
1. How will the product be made?
2. What equipments should be used?
3. Where the raw materials should be gathered?
4. What will be the floor plan of the business?
5. What will be the method of waste disposal for the maintenance of the business?
Financial Aspect
1. What will be the projected financial statements?
2. How much is the start-up capital?
3. How will the capital be allocated?
4. When will the return of investment be realized?
5. What are the other sources of capital?
Socio-Economic Aspect
1. How will the study contribute in the growth of economy?
2. What will be the benefit of the business to the community?
3. What will be the benefit of the business to the government?
4. What will be the benefit of the business to the environment?
5. How will the study be useful for the entrepreneurs?
VII. Objectives of the Study
The general objective of the study is to determine whether the business would be
feasible or not.
1. To know the process, plan and structure of doing business in real situations.
2. To identify potential problems that the business might encounter.
3. To analyze the marketing and financial risk feasibility of the proposed business.
4. To determine the potential for success of the proposed business.
VIII. Significance of the Study
The study gives the consumer a product which is affordable but with the same product
quality with those sold at an expensive price.
This section will provide a brief description on the various significances of the study
given:
To the Economy- This study would determine the economic preference of the people.
This will give information on what is happening in the market, what is the trend and how people
respond to a product.
To the Future Proponents- This study would serve as future reference to students whom
will also conduct a feasibility study. As expounded, this study would give them academic
assistance and support in creating their ideas.
To Entrepreneurs- this study would give them new ideas about what business follow the
latest trend and also good to engage at.
To the Existing Business- This study would help them determine their market position. In
addition, it would also give them information on how to improve their business operation.
To Prospective Businessmen- this study would provide them certain ideas about the
basics of starting up a business. Since they do not have enough knowledge about business yet,
this study would help them know the different aspects that should be considered in establishing
a business in order for them to have a background that they could use in the near future.
To the Proponents- In doing this study, the researchers have acquired abundant set of
skills and knowledge that they can apply in their profession or in starting up a business.
IX. Research Methodology
a. Research Design
A descriptive research methodology was used for this study. A survey was administered
to a selected sample from a specific population. Surveys are used to obtain data from
individuals about themselves, their households or about larger institutions (school boards).
Sample surveys are an important tool for collecting and analysing information from selected
individual (Rossi, Wright, and Anderson, 1983). It also assures respondents the confidentiality of
their shared information.
This design was chosen to meet the objectives of the study by providing structured
questionnaires to a number of identified respondents from residences near the business
location. The participants during the survey were randomly selected using the fishbowl method.
In using fishbowl method, there is a need for paper cards with corresponding numbers. The
numbers signifying the interval between the houses to be surveyed. Then, the researchers will
use the drawn number from the container to achieve randomness when doing the survey.

b. Research Locale
This study will be conducted within the barangay of Talon Uno and Talon Kuatro, Las
Pinas City particularly in the residences near the business establishment namely: Angela
Village, Pag-Ibig Homes, Happy Ville Subdivision, Antonio Compound, Holy Family 1st to 6th
Street, Julio Compound and Serafico Compound.
X. Related Literature and Studies

In the Philippines, entrepreneurship is viewed as important to empowering the poor,

enhancing production, and as an impetus to innovation. The 1987 Philippine Constitution
recognizes entrepreneurship as an engine of economic growth. Article XII Section I highlights
the role of private enterprises in supporting equitable distribution of income and wealth,
sustaining production of goods and services and expanding productivity, therefore, raising the
quality of life.()
Small businesses are vital to the success of the economy. Not only as they provide the
success stories of the future, but also because they meet local needs. Small business are often
far more flexible. It can do what is required. Due to small scale of operation, small businesses
have lower overhead costs. ()
Baking has grown over the last century in the Philippines, from a relatively small industry
to a large, popular industry. Initially, the island featured mainly independent bakeries that
serviced cities and towns and provided employment to the local people. Nowadays, chain
bakeries have increased the number of bakeries in the Philippines and have also lowered the
prices of bakery products. Due to the increased demand for bakery products from the population
in the Philippines, the baking industry has grown, leading to it providing greater employment
opportunities both in the bakeries and in central management. ()
Putting up a bakery in the Philippines is one of the most common yet profitable ventures.
Without a doubt, Filipinos always love to eat variety of breads, cakes, pastries, and other baked
goods. The baking industry has surely become an interesting venture, allowing businessmen to
dole out a fair amount of capital along with a huge income potential. Establishing a small bakery
would most likely require minimum capital that usually ranges from Php 1000 Php 5000. Basic
skills in baking are likewisenecessary, but additional knowledge can be acquired through further
research and training from culinary schools. Within a year or so, the hundred percent return on
investment is expected, recovering costs while earning profits simultaneously. ()
Cupcake baking as any other business related to the food industry, is something that will
not die easily. People need food, and people love food. You will always have a market for your
business. From toddlers to the elderly, people always enjoy a great-tasting fun cupcake. ()
In line with economic theory, culture probably shapes tastes and preferences. That is, if
culture consists of a system of shared beliefs, and people in that culture share tastes and
preferences, tastes and preferences have been shaped by the boundaries of culture. (Lindgreen
and Hingley, 2012)
Filipinos love pizza for the reason that in one kind of food, the flavours are already there.
Also, its something that is good for sharing with friends, and that Filipinos are very much into
friendship. It appeals to the Filipino taste buds and at the same time it is also a sumptuous treat
for the whole friends with its unparalleled overloaded and mouth-watering toppings. (De Castro,
2012)
XII. Project Time Table (Gantt Chart)

2014 2015
Activities Duration Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct
Project 3 mos
Planning/
Feasibility
Study
Market 2 mos
Testing

Release of 2 mos
Finances
from
Project
Business/ 2 mos
Company
Registration
Choosing 1 mo
of
Production
Site
Purchasing 2 mos
of
Equipment
and Office
Supplies
Hiring and 3 mos
Training of
Personnel
Start of
Operation