EXECUTIVE SUMMARY

Brief Description of the Project

Traveling is fun and exciting, or it can be stressful and boring, and the
luggage you use to tote your stuff affects that outcome. While the world is
becoming more high-tech and all the things come in handy, suitcases really
haven’t changed that much – well, except from advancements in materials
and designs.
Whether you’re planning to go to a place you haven’t been to, or simply
to spend a few days unwinding on a gorgeous beach, there is something to be
said about the thrill of packing your bags and heading to a far-off destination.
To make things easier especially when you are in a rush at an airport, the
researchers developed a smart luggage that could be the next scientific
breakthrough – an Electromagnetic Controlled Luggage (Dog Luggage). This
Smart Luggage can follow you wherever you go, has a GPS tracking device, has
an anti-theft feature and could become your power source for days.
The smart key chain that the user is using allows and activates the
luggage to follow him because of the electromagnetic chip that is installed in
the luggage. This feature can only be possible if the user is wearing or holding
the key chain. For the safety of the stuffs and the luggage itself, it is equipped
with a Global Positioning System (GPS), the polycarbonate shell used as the
main frame of the luggage is anti-cut and is water repellent. It also has designs
of road security reflective stripes so that it is visible even along the road. It has
optimal weight balance which makes the Dog Luggage stable and balanced
while it follows the user or it strolls together with the user. It has adjustable open
angles for the convenience of the user and an integrated USB charging ports
where you can charge your smart phones and laptops.
This scientific breakthrough has become possible through the power of
lithium-ion batteries which are also used in powering electric cars and
smartphones. Some airports ban smart luggage which are powered by lithium-
ion batteries because this type of battery may cause fire at the cargo area.
Because of this, our lithium-ion battery installed in the Dog Luggage is
removable, hence, it is allowed to be travelled.

Brief Profile of the Entrepreneur

The pioneers of the Dog Luggage are a group of young entrepreneurs
gearing towards a revolutionary technological future for the comfort of travelers
locally and internationally. The pioneers are well-knowledgeable in different
business strategies, in marketing, and in management and cost accounting.
These different talents would like to combine and create a partnership for them
to be able to contribute their different knowledge, resources, and skills.
Project’s Contribution to the Economy
 The Electromagnetic Controlled Luggage can become a new avenue for
companies who venture in providing services to travelers to actually lessen their
cost in manpower. Instead of hotels and airports using manpower in transporting
luggage, the luggage of the user can just follow him to the elevator going to his
room and to the plane. This is more convenient and lesser stress to the user and
more income for service providing companies.
 Section 1
MARKETING PLAN
1.1 Description of the Product
Smart Luggage has become one of the best advances in technology next to
mobile phones. From just simple bags with rollers to ease in carrying stuffs while
travelling, now it has more to offer. And to give customers more options in the
market, the “Dog Luggage” is making its way.
This Dog Luggage is a type of smart luggage but has more to offer. It follows the
user wherever he wishes to go or it strolls beside the user while he is walking, has
a GPS tracking device, equipped with anti-theft features and could become
power source for days.
The Dog Luggage that the researchers offer comes in set with a dog key chain–
a key chain used to control the luggage and allows the user to be detected by
the electromagnetic chip installed in the luggage.
The researchers designed the Dog Luggage to become a revolutionary
innovation in the luggage industry. From the materials used in the main frame of
the luggage to the unbreakable shell down to the rollers, everything is made
sure to be of high quality and to be of ease to the user.
Aside from the anti-cut and water repellent polycarbonate shell used in the
luggage, USB ports are installed in the handle base which connects to an
ejectable 24,000 mAh lithium ion battery that holds enough power to charge a
smartphone five times – enough to be a power source for days.
1.2 Comparison of the Product with its Competitors
While there is no denying that carrying Away, Rayden, Barracuda or Arlo Skye –
the pioneers when it comes to smart luggage – are the most expensive to fly
with, travelers tend to find alternatives which suits their specifications best.
There are no stores in Baguio City which offers smart luggage since these are just
quite newly introduced in the market and are barely known by most people. Its
features such as anti-theft, charging ports and GPS tracking device cannot be
found on any luggage that are currently on the market. Dog Luggage’s auto-
follow feature makes it the first and only auto-follow luggage in the market and
this what makes it even better than the others.
1.3 Location
Baguio City is the melting pot of different peoples and cultures in the northern
part of the Philippines. Due to this, more and more business establishments are
lured to the city. The city has a large retail industry, with shoppers coming to the
city to take advantage of the diversity of competitively priced commercial
products on sale.
As a business, you need to be located in a place where your customers are
coming from. This is also a good way to target potential customers. The
researchers find Baguio City particularly Session Road as the best location for this
type of business since this is part of the central business district where many
residents as well as tourists pass by. When you are located in Session Road, there
is a greater potential customer as more people will be able to visit the retail store
due to its accessibility.
1.4 Market Area
Since Baguio is a highly urbanized city and dubbed as the Center of Business,
Commerce and Education of the Northern Philippines, as a starting business you
can benefit from choosing it as a market area.
In an urbanized place, people often have much higher income compared to
those residing in the rural area. The number of people and migrants living in
cities grow more quickly too since opportunities are better in these places. Also,
people in Baguio are mostly comprise of busy people – be it business men,
employed individuals, students, and simply tourists – who go to places more
often than not. These factors can help emerging businesses to be known in the
public.
1.5 Main Customers
The researchers target market are the frequent travellers like tourists and
businessmen of Baguio City. Businessmen and professionals tend to go to places
to take care of their matters. Tourists come and go to the city. They could be a
good target market because they are the ones who need a compartment
where they can tote their stuffs while on the road. What’s best to transfer their
stuff while traveling than the Dog Luggage, right?
1.6 Total Demand
Demand analysis is one of the important considerations for a variety of
business decisions like determining sales forecasting, pricing products/services,
marketing and advertising spending, manufacturing decisions and expansion
planning. Demand analysis covers both future and retrospective analysis so that
they can analyse the demand better and understand the product/service's past
success and failure too.
a. Normal Capacity (a)
The proponents would like to use the 125% Average Normal Capacity of
the competing companies in the market as its Normal Capacity.
Computation of Normal Capacity
Normal Capacity of Competitors 3,672
Div ided by: No. of competitors 5
Normal Capacity for Dog Luggage Production 734
Add: Spare Capacity (25%) 184
Total Normal Capacity 918
b. Computation of Normal Capacity of Competing Companies/ Normal
Capacity (b)
The proponents based the normal capacity of the competing companies
on the data gathered from their employees and from the estimates by the
researchers.
Computation of Normal Capacity of Competing Companies
Company Name Annual Capacity no. of colors no. of sizes Total Annual Capacity
SM City Baguio Department Store 72 3 3 648
JQC Enterprise Cedar Peak 120 1 3 360
Tiong San Harrison 600 1 3 1800
Tiong San Bazaar 48 1 3 144
Mart One - Center Mall 240 1 3 720
Normal Capacity (b) 3672
Div ided by: Number of Competitors 5
Average Normal Capacity 734.4

c. Computation of Total Demand

Computation of Total Demand
Normal Capacity (a) 918
add: Normal Capacity (b) 3672
Total Demand 4,590

Based from the information gathered by the researchers, the total

demand from the market will be 4, 590 annually.
d. Computation of Specific Demand

Computation of Annual Demand

Av erage Price of Annual
Company Name Annual Sales
Luggage per unit Luggage Sale
SM City Baguio Department Store 3600000 6000 600
JQC Enterprise Cedar Peak 240000 700 343
Tiong San Harrison 6000000 3500 1714
Tiong San Bazaar 360000 2500 144
Mart One 2400000 3500 686
Total Actual Demand 3487

Computation of Specific Demand

Total Demand 4,590
less: Actual Demand 3487
Specific Demand 1,103

1.7 Market Share

 Every business needs to stay on top of the competition and on top of their
share of the market. Having a sense of market share provides a good indication
of a company’s competitive rank and a way to monitor its growth within its
target market. Sooner or later in the world of business, some banker, advisor, or
partner will ask the researcher about their market share. Market share is the
portion of their business that captures of all the sales of products like the
researcher’s market area
The researchers anticipate the share of their market(SOM) will be 24.03%.
The researchers intend to get that market share by adapting a low pricing
policy.
Computation of Market Share
Specific Demand 1,103
Div ided by: Total Demand 4590
Market Share 24.03%

1.8 Selling Price

One of the decisions most crucial to business success involves pricing the
product. The researchers need to arrive at prices that will cover all costs and
that will deliver a reasonable profit margin, while also hitting the sweet spot of
what customers are willing to pay for the value they believe they received from
the purchase.
To get the pricing right, the researchers need to match the price of the
product “DOG LUGGAGE” to the image of the business and the nature or the
clientele, while also covering the researchers production and operational costs
and delivering the profits necessary for their business survival.
The researchers would like to use 25% mark-up on the selling price of the
dog luggage to cover all costs of production, selling and administrative
expenses.
Computation of Selling Price
Direct Materials per unit 5484
Direct Labor per Unit 790
FOH per unit 1918
Total Manufacturing Cost per unit 8192
Multiplied by: Mark-up+1 1.25
Selling Price 10240

1.9 Sales Forecast

 Total Sales Forecast for Six Years
2019 2020 2021 2022 2023
Sales Forecast 918 918 955 993 1,033
Selling Price 10,239.89 10,547.09 10,863.50 11,189.40 11,525.09
Total Sales 9,400,218.21 9,682,224.75 10,371,599.16 11,110,057.02 11,901,093.08
note: sales forecast increases by 4% annually

1.10 Promotional Measure

Promotional strategy communicates with customers, consumers or prospects to
inform, persuade or remind them about the product. There are many ways
where businesses can promote their products.
In promoting the dog luggage, the pioneers’ marketing team will be using social
medias like facebook and local newspaper outlets in introducing the product to
the market. The social media, particularly facebook, is one of the best ways to
reach people who are the potential customers and introduce new products in
the market. The marketing team will be posting advertisement videos from time
to time so they can get into more people possible. The pioneers can get into the
part of the market who are not into social media through the traditional way -
the newspaper.
These promotional measures will help the launching of the dog luggage to be
successful.
1.11 Marketing Strategy
Nowadays, we observe that many people spend their time exploring, looking
and searching things through the internet. Considering the fact that people use
internet most of the time, using social media is the best way to promote your
business.
Hence, Facebook is the number one social media site in the world, we consider
using it as a means to reach our target sales and customers. Research says that
more than a billion of people uses facebook every day. By posting and
promoting the business through social media sites will save you much time and
money. Making video tutorials can also be a way to generate your business
income and to achieve your forecasted sales.
Some people may not be satisfied by just reading the features of the product
but by seeing it also with their eyes. Making videos will let the customer be more
attracted by the features of the products. Youtube is the second largest search
engine in the world and by posting a video of your product will generate more
income to the business.
The researchers could also see that billboards, newspapers, and banner ads are
also other ways of introducing the product to the market.
1.12 Marketing Budget
 BREAKDOWN OF ADVERTISING EXPENSE
Item Annual Quantity Projected cost per unit Total
Official Website 1 351,520 351,520
E-banner 6 10,000 60,000
Brochure and flyers 6,000 10 61,500
Newspaper Publication 24 7,500 180,000
Total Adertising Expense 653,020

To be able to promote the dog luggage , the researchers studied what is

the best way to advertise new products. The following are the different
advertising ways: first is the official website, to create our own official website will
help the researchers introduce the product in the market where customers can
see the product with its specifications and features. the cost of making it is 351
520 and it includes development as well as maintenance and update for the
first year. (IT website-program and site development). electronic banners is also
a way to inform other potential customer and the cost is about 10000 per month
and we plan to air it for 6 months until kjnown (porta vaga rate) brochures and
flyers as well as publications are another cost about 241 500 (baguio publication
rate).

Section 2
PRODUCTION PLAN
2.1 Production Process
The Dog Luggage will be assembled at the factory out of the raw materials
purchased from different direct suppliers in partnership with the company.
Step 1: Component List
The main components of the Dog Luggage are the following:
COMPONENT TYPE
Luggage - Wheeled Luggage
- thermoplastic shell(impact-resistant)

Magnetometer - Scalar

GPS Navigation Chips - Global Navigation Satellite System

Arduino Uno - Processor: 16Mhz ATmega328

- Analogue: 6 input, 0 output

Distance Sensor - HC- SR04 Ultrasonic Distance Sensor

Infrared Sensor and Remote - Active infrared sensor

LCD Lights - LED strip lights

Lithium- ion battery - Lithium iron phosphate

USB Ports - Dual USB Charger Power Module

Accessories

Wire - Gauge silicone Wire Flexible

Stranded Copper Cables for RC wiring

DC motor - Permanent Magnet DC motors

Step 2: Dismantling of the Luggage

The purchased luggage will be dismantled to install all the necessary features
needed for the dog luggage to perform as intended. The handle, the rollers,
and the mainframe will all be removed.
Step 3: Installation of Lithium-ion battery
The upper portion of the luggage will be customized. Six 2200 mAh lithium ion
battery will be the power source of the entire dog luggage. This will be installed
at the customized upper part of the luggage.
Step 4: Installation of USB Charging ports, GPS tracking device, electromagnetic
chips and sensors.
The removed handle of the luggage will be customized to fit in the infrared
sensor at the scopic handle. On the both ends of the scopic handle, the arduino
uno, magnetometer and GPS navigation system will be installed. On the part of
the flexible strap handle, the USB charging ports will be put.
Step 5: Installation of the Light Emitting Diode (LED) lights
To make the dog luggage more visible to people who are walking together or
towards the direction of the luggage, the proponents will be installing LED strip
lights at the impact resistant ABC thermoplastic shell of the luggage.
Step 6: Installation of DC motor to the wheels of the luggage
A permanent magnet DC motors will be installed next below the main frame of
the luggage to support the automatic movement of the luggage.
Step 7: Puttiing back the rollers and handle
After the installation of every part of the dog luggage to its proper spots, the
parts will now be put together. First to be put back is the rollers, followed by the
handle. The parts will all be connected to the removable 24000 mAh lithium-ion
battery through the use of gauge silicon wire.
2.2 Fixed Capital
Based from the data from the National Housing Authority, the average cost per
square meter for the past 15 years to construct a new house or an industrial
house, including building, electrical, mechanical, plumbing and others.

1. Cost of Assembling Factory Building

 Cost of Factory Building
ITEMS QUANTITY PRICE TOTAL
Excel Holcim Cement 450 ₱ 240.00 ₱ 108,000.00
Sand 650 ₱ 700.00 ₱ 455,000.00
Grav el 548 ₱ 700.00 ₱ 383,600.00
Nail (1 kg) in any sizes 216 ₱ 43.00 ₱ 9,288.00
GI Corrugated Ordinary 26 x 8 feet 150 ₱ 176.00 ₱ 26,400.00
GI Corrugated Ordinary 26 x 12 feet 150 ₱ 264.00 ₱ 39,600.00
Galv anized I ron (GI Sheets) Corrugated 26 x 8 150 ₱ 189.00 ₱ 28,350.00
Galv anized I ron (GI Sheets) Corrugated 26 x 10 150 ₱ 245.00 ₱ 36,750.00
Galv anized I ron (GI Sheets) Corrugated 26 x 12 150 ₱ 290.00 ₱ 43,500.00
GI Plain 26 230 ₱ 194.00 ₱ 44,620.00
GI Plain 24 x 8 230 ₱ 269.00 ₱ 61,870.00
Umbrella Nails 2 1/2 108 ₱ 80.00 ₱ 8,640.00
Deform Bar 10mmx6m (1 length) 188 ₱ 105.00 ₱ 19,740.00
GI Wire #16 (1kg.) 245 ₱ 52.00 ₱ 12,740.00
Welded Wire Gauge 16 1/2 x 3 Silv er (1 meter) 98 ₱ 238.00 ₱ 23,324.00
Ordinary Plyw ood 1/4 (1pc) 144 ₱ 385.00 ₱ 55,440.00
Ordinary Plyw ood 1/2 (1pc) 144 ₱ 675.00 ₱ 97,200.00
Ordinary Plyw ood 3/4 (18mmx4x8) (1pc) 165 ₱ 880.00 ₱ 145,200.00
Apollo Rubber Cement (Rugby) 350cc (24/1) (1bottle) 180 ₱ 55.00 ₱ 9,900.00
Pioneer All Purpose Epoxy Pint (1 set/pair) 168 ₱ 290.00 ₱ 48,720.00
Welding Rod (1kg.) 288 ₱ 62.00 ₱ 17,856.00
GI Pipe 1 1/4 (1 length) 185 ₱ 885.00 ₱ 163,725.00
Square Bar (1 length) 342 ₱ 195.00 ₱ 66,690.00
Plain Sheet Gauge 18 (1sheet) 196 ₱ 1,450.00 ₱ 284,200.00
Flat Bar 5mm x 1 (1 length) 278 ₱ 165.00 ₱ 45,870.00
GI Pain Thinner 350cc (24/1) 180 ₱ 40.00 ₱ 7,200.00
Boysen QDE Royal Blue Paint 1 liter B640 464 ₱ 148.00 ₱ 68,672.00
Mirka Floor Sanding No. 80 500 ₱ 45.00 ₱ 22,500.00
I nterlink Wire 4 inches (hole) x 5 feet (height) x 8 meters (length) - 1 roll 214 ₱ 650.00 ₱ 139,100.00
I nterlink Wire 4 inches (hole) x 6 feet (height) x 8 meters (length) - 1 roll 214 ₱ 780.00 ₱ 166,920.00
Barb Wire 120 meters length 315 ₱ 1,350.00 ₱ 425,250.00
(AR-2.0) Nail Cable Clip for PDX-12 - 1 pack 116 ₱ 95.00 ₱ 11,020.00
China Shelf Bracket - 12 x 14 - 1 pair 239 ₱ 55.00 ₱ 13,145.00
PE Pipe 1/2 size (90 meters length) 300 ₱ 1,250.00 ₱ 375,000.00
PE Pipe 3/4 size (90 meters length) 300 ₱ 2,460.00 ₱ 738,000.00
TOTAL ₱ 4,203,030.00
The researchers did not include the cost of the land because it is a
donation from one of the partners. The researchers therefore only accounted
the cost of the factory.
b. List and Cost of Machineries needed

List of Machineries Needed

QTY UNIT PRICE TOTAL COST SPECIFICATIONS DESCRIPTIONS

MANUFACTURING EQUIPMENT -
Fully automatic electric
Shaftless Screw
protection/compact in
Conv eyor for Sludge
structure/conv enient
Transfer in Sewage
installation with
Treatment Plant
Conv eyor Belt 2 395,000 790,000 expansion bolts
OTHER EQUIPMENT -
Best for fire inv olv ing
Cyclone 10lbs fire solid materials such as
Fire Extinguisher 2 2,500 5,000 extinguisher wood, cloth, wires
COT Hardware
platform cart FD-300 Durable and is easy to
Push Cart heav y duty 1 4,799 4,799 heav y duty use
Durable and best for
plants with few
Generator 1 16,800 16,800 productions

TRANSPORTATION EQUIPMENT -
Good in transporting
Deliv ery Truck 1 300,000 300,000 Isuzu Elf 2008 products
TOTAL MACHINERIES 1,116,599

2.3 Life of Fixed Capital

The normal life of an assembling warehouse based from the data of NHA is 20
years, hence, the depreciation expense of the assembling warehouse using the
straight line method is:

Depreciation of Factory Warehouse

Total Square Meters 390
Av erage cost per square meter 10777
Total Cost of Warehouse Factory 4203030
Salv age Value 500000
Depreciable Amount 3703030
Useful Life 20
Depreciation Expense-Factory 185151.5

The normal life of the conveyor belt which will be used in the factory warehouse
is 20 years. The fire extinguisher, the push cart heavy duty and the generator are
having useful life of 15 years. The 2nd hand delivery truck has an estimated
useful life if 8 years. Hence, the depreciation for the machineries follows:
 Machineries
DEPRECIATION EXPENSE
ANNUAL
QTY UNIT PRICE TOTAL COST USEFUL LIFE DEPRECIATION 2019 2020 2021 2022 2023 2024
MANUFACTURING EQUIPMENT -
Conv eyor Belt 2 395,000 790,000 20 39,500 39,500 39,500 39,500 39,500 39,500 39,500
OTHER EQUIPMENT -
Fire Extinguisher 2 2,500 5,000 15 333 333 333 333 333 333 333
Push Cart heav y duty 1 4,799 4,799 15 320 320 320 320 320 320 320
Generator 1 16,800 16,800 15 1,120 1,120 1,120 1,120 1,120 1,120 1,120
TRANSPORTATION EQUIPMENT -
Deliv ery Truck 1 300,000 300,000 8 37,500 37,500 37,500 37,500 37,500 37,500 37,500
TOTAL EQUIPMENT AND APPLIANCES 1,116,599 78,773 78,773 78,773 78,773 78,773 78,773 78,773
I nput Vat 119,636
Equipment and Appliances(paid) 996,963

2.4 Maintenance and Repairs

In maintaining the machinery, we will be having two maintenance which
are the minor and major maintenance. Basically, minor maintenance will be
done bi-monthly and the major maintenance will be done annually. Bi-monthly
maintenance is the checking of the machinery whether it is working smoothly or
not. Annual maintenance is changing the spare parts of the machinery when it
is necessary and repairing the spare parts when it is not intended to be
changed. Spare parts may be found in different places in the Philippines. Most
of the parts are found in NCR specifically in Metro Manila.

BREAKDOWN OF REPAIRS AND MAINTENANCE EXPENSE

Item cost per month number of months total cost
Machineries 835 12 10020
Furnitures and Fixtures 500 12 6000
Factory 850 12 10200
Deliv ery Elf 1250 12 15000
Total Miscellaneous Expense 41220

2.5 Sources of Equipment

The machineries were obtained after completely transacting with the

seller online through the website ph.priceprice.com for the delivery truck while
the conveyor belt will be bought in China from Jiangsu BOE Environmental
Protection Technology Co., Ltd.
Other machineries will be purchased online through the online seller
website lazada.com.ph with terms FOB Destination. The international purchase is
subject to 12% VAT for importation.

2.6 Planned Capacity

The company is on a 302-day operations on its first calendar year. Annually, the
researchers are anticipating a total of 918 production which is equivalent to
roughly 3 per day.
The planned capacity of the company’s retail store is 80 units monthly. This was
determined from the average normal capacity of the competing stores plus
32% for the spare capacity.
 Computation of Normal Capacity
Normal Capacity of Competitors 3,672
Div ided by: No. of competitors 5
Normal Capacity for Dog Luggage Production 734
Add: Spare Capacity (25%) 184
Total Normal Capacity 918

Demand Working Hours # of hours / # of units / Total

batch batch

Daily 8 hours 2 hours and 1 3

40 mins.

2.7 Future Capacity

After the launching of the best smart luggage in the market, the
proponents are anticipating a greater demand from the public. Since ample
number of tourists are visiting the city everyday, the researchers believe that
more and more people will know about this product and a lot more potential
customers will come our way.
Due to this, the researchers are planning to increase the future capacity
of the store by 4% annually, to cater the demand of the public. Hence, the
table below shows the future capacity of the company for the next five years

Computation of Future Capacity of the Plant

Year 2019 2020 2021 2022 2023
Normal Capacity last year 918 918 955 993 1,033
I ncrease in Capacity 1.00 1.04 1.04 1.04 1.04
Normal Capacity this year 918 955 993 1,033 1,074

2.8 Terms and Conditions of Purchase of Equipment

The equipment is purchased through cash from the initial investment of the
partners. Through communicating with the seller, the researchers are
anticipating terms of FOB Destination, freight prepaid.
2.9 Factory Location and Layout
The researchers are planning to put up its assembling warehouse where the land
area is sufficient, there are good roads for easy travel of supplies and products
to be sold, and the cost of labor is cheaper. The factory shall be located at
Bugias, La Trinidad, Benguet.
The design of the facility should correspond to international standard and should
be designed so that it could easily be expanded or adjusted as needed to meet
the future production needs. Although redesigning a facility is a major,
expensive undertaking not to be done lightly, there is always the possibility that
a redesign will be necessary. Therefore, any design should be flexible, flexible
manufacturing systems most often are highly automated facilities having
intermediate-volume production of products.
2.10 Raw Materials Commented [1]: bedz ganito ba un?
The following components are needed for the production of one unit of
the dog luggage.
QUANTITY MATERIAL FUNCTION Made from

1 Luggage Hold the traveller's -Polycarbonate

things while the shell
traveler is in transit - handle
- rollers

1 Magnetometer Sensors used for iron core

sensing magnetic
fields OR to
systems which
measure
magnetic field
using one or more
sensors

1 GPS Navigation Provides

geolocationand
time information
to a GPS receiver
anywhere

1 Arduino Uno A microcontroller -Power (USB /

that can sense the Barrel Jack)
environment by -Pins (5V, 3.3V,
receiving input from GND, Analog,
a variety of sensors Digital, PWM,
and can affect its AREF)
surroundings by -Reset Button
controlling lights, -Power LED
motors, and other Indicator
 actuators. -TX RX LEDs
transmit receive
-Main Iintegrated
Circuit
-Voltage
Regulator

1 HC-SR04 For object Vacuum Sensor

Ultrasonic avoidance
Distance Sensor

1 Infrared sensor To detect the

and remote wavelength of
the LED light

2 LED Lights To be detected -LED lamp;

by the sensor -LED Chip,
- Driver,
- LED chip emits
lights the in the
bulb. Heat Sink,
and the Optic
lens.

1 Lithium Ion For the luggage

Battery to work

1 Dual USB To charge the

Charger Power battery of the
Module luggage
Accessories

1 Used in power
generation, power
8 AWG Gauge transmission,
Silicone Wire power distribution,
Flexible Stranded telecommunication
Copper Cables s, electronics
for RC Wiring circuitry, and
countless types of
 electrical
equipment.

2 Rotary electrical
machines that
DC motor converts direct
current electrical
energy into
mechanical
energy.

2.11 Cost of Raw materials

PROJECTED COST OF DIRECT MATERIALS

ITEMS Qty Measures Cost 2019
Luggage 918 Pieces 1,545.00 1,418,310.00
Magnetometer 918 Pieces 419.00 384,642.00
GPS Nav igation 918 Pieces 2,116.00 1,942,488.00
Arduino Uno 918 Pieces 406.00 372,708.00
HC-SR04 Ultrasonic Distance Sensor 918 Pieces 89.00 81,702.00
I nfrared sensor and remote 918 Pieces 44.00 40,392.00
LED lights 1,836 Pieces 9.00 16,524.00
Lithium ion battery 3,672 Pieces 123.00 451,656.00
Dual USB charger pow er module accessories 918 Pieces 399.00 366,282.00
8 AWG Gauge silicone w ire 918 meters 37.00 33,966.00
Soldering rod 1,836 meters 3.25 5,967.00
DC motor 1,836 Pieces 294.00 539,784.00
TOTAL DIRECT MATERIALS 5,484.25 5,648,454.00

2.12 Raw Materials Availability

The researchers anticipate that the company will have to order its materials from
the different suppliers from China where freight is shouldered by the seller to
reduce cost. Since international delivery of raw materials take up to 7-15 days,
the company will place an order of 20 pieces of each raw materials needed in
production for every seven (7) days to be able to keep the level of the inventory
sufficient.
As the business grows, the researchers are planning to increase the volume of
orders by 5% annually.
2.13 Labour

For the factory of the company, it will need the following manpower:

Job/Department Job Description Number of

employees needed

Dismantling Man To dismantle the luggage so 1

that the necessary devices
needed for the dog luggage
to work will be installed

Battery Installator The worker will be the one to 1

put the power source of the
dog luggage which is the
lithium-ion battery.

USB Ports The worker will install the USB 1

Installator cahrging ports to the handle
of the dog luggage.

LED lights The worker will be installing 1

installator the LED lights at the body of
the frame of the luggage.

Motor Wheels The motor wheels will be 1

Installator installed last after all
necessary devices needed
are already installed.

Rollers and The worker will put back the 1

Handles Man handles and the rollers to the
dog luggage. This includes an
expertise in electric wirings.

Tester This will be the one to test 1

whether the dog luggage is
perfectly working.
Packer AFter the testing of the 1
product, this will be the one to
pack and put the luggage to
its box.

Total 8

2.14 Cost of Labour

Based from the data gathered from National Wages and Productivity
Commission, the minimum wage for employees employed in La Trinidad,
Benguet is 300.

PROJECTED DIRECT LABOR

No. of
working
Job Description Rate days 2019
Dismantling Man 1 300 302 90,600
Battery I nstallator 1 300 302 90,600
USB Ports 1 300 302 90,600
LED lights installator 1 300 302 90,600
Motor wheels installator 1 300 302 90,600
Rollers and Handlers Man 1 300 302 90,600
Tester 1 300 302 90,600
Packer 1 300 302 90,600
TOTAL 8 302 724,800

The number of days was based on the 2019 Calendar excluding Sundays and
Holidays in the Philippines. The total annual labour cost is P 724, 800.

2.15 Labour Availability

The researchers will be signing contracts with agencies so that they will be the
one to supply the manpower needed in the production and retail store. In this
case, the researchers do not see any scarcity of manpower, hence, no effect
on the production throughout the year.

2.16 Labour Productivity

There are some ways to motivate the workers for them to do their jobs
effectively and efficiently like by letting them know that the researcher’s trust
and depend on them, the workers will fill those shoes sooner than the
researchers think. A vote of confidence can go a long way.
Letting them know that the researchers trust them to do the best job possible
and they will rarely disappoint the researchers. The researchers must be able to
motivate their workers/employees by giving them a purpose. When the
researchers accomplish that, they understand the vision better and are able to
execute more strongly. In addition, by understanding their purpose and the
purpose of the business, an employee is better able to understand how they fit
into the big picture. The researchers must always pump energy through the
office.
The researchers must be really enthusiastic and want their staff to feed off that
positive energy. Because culture is so important to the researchers. The
researchers must do anything to keep the offvie alive like have fun, joke around,
and play games. The researchers work hard, but the researchers play hard too.
The researchers have to be in the moment and high-energy all the time!
2.17 Factory Overhead Expenses
The monthly factory overhead expenses computed by the researchers follows:

Factory Overhead

2019
Utilities-Factory 334,097
Repairs and Maintenance 41,220
Depreciation Expense 268,617
Supplies-Factory 22,231
I nsurance Expense 14,000
I ndirect Labor 1,060,800
Total 1,740,965

BREAKDWON OF UTILITIES EXPENSE-FACTORY

Item estimated cost per month number of months Annual Cost
Water 8,333.33 12 100,000
Electricity 18,509.08 12 222,109
Telephone and internet 999.00 12 11,988
Total 334,097

According to the data gathered from the Department of Energy, the average
electric consumption of small businesses annually is Php 222, 109.14.
The Annual depreciation expense of the building and the PPE is equal to 268,
617.

The computation of the estimated annual indirect labor follows:

Salaries and Wages Expense
Total Basic
Employees No. of EE REGULAR PAY
Summary

Production Superv isor 1 16,900 16,900

Purchasing Manager 1 16,900 16,900
Materials Management 1 11,700 11,700
Human Resource Superv isor 1 16,900 16,900
HR Officer 1 11,700 11,700
Accounting Personnel 1 14,300 14,300

TOTAL 6 88,400 88,400

ANNUAL 1,060,800

The researchers based the salary of the indirect labors from the website
www.payscale.com which gives annual average salaries of different
professionals.

2.18 Production Cost

TOTAL PRODUCTION COST

Direct Materials 5,648,454.00
Direct Labor 724800
Factory Ov erhead 1760833.067
Total Manufacturing Cost 8,134,087.07
div ided by: Production units 918
Production Cost 8,860.66
 Section 3

ORGANIZATION AND MANAGEMENT PLAN

3.1 Form of Business
A business can be organized in one of several ways and the form its
owners choose will affect the company’s and owner’s legal liability and
income tax treatment. The researchers themselves would like to create
general partnership as their form of business. Aside from it has more
resources because partners can improve each others’ access to capital,
it also has less government supervision and more expertise since different
partners will bring different experiences and skills.
With an initial investment of Php 12, 833, 641 from the partners, five
will have an initial investment of Php 1, 722, 273 while one of the partners
will have an initial investment of Php 4, 222, 273. All partners will have an
equal distribution on the net income or loss of the company.

3.2 Organizational Structure

Commented [2]: carla, pa add daw ng mga laborers at
sales lady
Commented [CJSM3R2]:

MANAGEMENT TEAM
Since the partners are busy people and to avoid conflict in the
partnership, the researchers constructed an organizational chart wherein
 the powers from the company is fairly segregated to all the partners. The
General manager reports to all the partners and is the one who oversees
the operation of both the factory and the retail store of the company. To
help the general manager, the researchers decided to create manager
of both the factory and the retail store to be able to increase the
effectiveness and efficiency of work.
3.3 Business Experience and Qualifications of the Entrepreneur
Basically, there are a lot of qualifications that an entrepreneur must
possesses. The entrepreneur should know how to manage money
because if you can’t manage money then you can’t manage business as
well. They should also know how to raise money. The entrepreneur should
be productive to help the business grow. They should also know how to
make entrepreneur friends because having friends will help you in your
struggles and give you much needed insight.
They should know also how to train themselves everyday. Meaning
they must try to improve themselves each day. We all know that no
business venture is a straight line to success that is why knowing how to
deal with downs and ups is essential. Lastly, the ability to focus on your
customers is much needed. Without customers, their is no business. The
entrepreneur should know what are the customer needs and wants
because they are the big factors of a business.
3.4 Pre-Operating Activities
Gantt Chart of Activities

Activity May Jun Jul Aug Sep Oct Nov Dec Jan

Conduct
Feasibility Study

Partnership
Formation

Securing Permits
 Purchasing of
Materials,
Equipment and
Supplies

Recruitment,
Selection,
Hiring and
Training of
Personnel

Installation and
Test Runs of
Machine

Advertising and
Promotion

Start of Operation

As a new newbie in the market, there are lots of preliminary activities

needed for the formation of the firm, and in advertising, promotional activities,
employee training, and so on, before the firm can open its doors for business.
Business startup includes the process of registration with the right
government agencies and authorities. This is an important step that must not be
missed by any business, whether it is a small, medium or large enterprise. This is
also the process that will make your company legitimate and duly registered.
1. Registration of business name in Securities and Exchange
Commision since it is a partnership.
2. Obtain a Barangay Clearance from the local Barangay Office
where the businesses is located.
3. Register the businesses and employees with SSS since there are
workers employed in the firm.
4. Employers to register their employees with PhilHealth and remit to
the agency their share of contribution.
 5. Register to HDMF. Employers must also register their business and
remit their employers’ share of contribution for employees to the
agency.
6. Register and obtain a permit with the Municipality or City Mayor’s
Office.
7. Register business with the Bureau of Internal Revenue to secure a
BIR Certificate of Registration.
8. Register with the DOLE for the purpose of monitoring the firms’
compliance with labor regulations.
Next,since dog luggage is still unknown to people, it just right to focus on
advertising the product so that people and potential customers will get to know
more about its features and attributes. Advertising will include social media
marketing where Official website will be made so that people can access it
online. Another is the use of E-Banners where a commercial will be made
available for airing in porta vaga and lastly is the use of brochures, flyers and
newspaper publication as a part of local and in-store marketing.
Another pre- operating activity will include employee training and
seminars as well as workshops.There are potential drawbacks that training and
development provides both for the company as a whole and the individual
employees.Training, workshops and seminars gives employees the opportunity to
expand their knowledge base, it allows them also to strengthen those skills that
each employee needs to improve and lastly they’ll be able to perform their job
better. A development program brings all employees to a higher level so they all
have similar skills and knowledge. This will enable them to enhance their
knowledge and skills as to how will they do their job particularly employees in
marketing , assembly and trial and testing department wherein employees will
know what should be done just in case something unexpected came up.
3.5 Pre-Operating Expenses
These pre operating expenses are based on the activities provided above
and from the previous section.
Registration to authorized government agencies and authorities.

Pre-operating Expenses
Item Cost
Advertising Expense 426,895
Auto and Truck Expenses 7,500
Other Expenses 91,518
HDMF Expense 10,608
Miscellaneous Expense 3,140
PHIC Expense 4,950
Rent Expense 183,600
SSS Expense 16,020
Taxes and Licenses 3,935
Supplies-Store 2, 625
Utilities-store 7,500
VAT on Importation 94,800
Travel 3,000
Total Pre-operating Expenses 856,091

Other Expenses
Other Pre-operating expenses
Organizational Activity Amount
BIR Registration Form 500
Community Tax Certificate 500
SEC Registration 4500
Legal Fee 450
Documentary Stamp 25
Depreciation Expense 19693
Business Name Registration 500
Employees Seminars and Training 10000
Renovation Expense 50000
Hiring Expense 5000
Notary Public Fee 350
Total 91,518

Advertising Expense
BREAKDOWN OF ADVERTISING EXPENSE
Projected cost per
Item Annual Quantity unit Total

Official Website 1 351,520 351,520

E-banner 6 10,000 60,000

Brochure and flyers 6,000 10 61,500

Newspaper Publication 24 7,500 180,000

Total Advertising Expense 653,020

Cost of Website
Set up 8, 320
Design and Building 260, 000
Content Creation 26, 000
Training to use it 31, 200
Maintenance 26, 000
Total Cost of Website 351, 520

3.6 Office Equipment

A fixed asset is an item with a useful life greater than one reporting period,
and which exceeds an entity's minimum capitalization limit. A fixed asset is not
purchased with the intent of immediate resale, but rather for productive use
within the entity.

QTY UNIT TOTAL COST

PRICE
STORE EQUIPMENT
Desktop Computer 1 18999 18999
Receipt Printer 1 3500 3500
Code Scanner 1 2000 2000
Cart 1 4799 4,799
OFFICE EQUIPMENT -
Office Chair 10 549 5,490
Office Table 10 2,166 21,660
Desktop Computer 1 18,999 18,999
Printer 1 2,500 2,500
File Cabinet 3 499 1,497
TOTAL EQUIPMENT 79,444

3.7 Administrative Expenses

Production Supervisor 274, 572
Purchasing Manager 584, 820
Materials Management Staff 300, 000
Accounting Personne 432, 000
Human Resource Supervisor 300, 000
Human Resource Officer 216, 000
Retail Store Employees 362, 400

(guard, cashier, sales lady, sales lady)

 Section 4
FINANCIAL PLAN
4.1 Project Cost

PROJECT COST
Item Cost
Pre-operating Expenses 856,091
DM 1412113.5
DL 181200
OH 392848.52
OPEX 2915578.5
Machineries 1116599
Furnitures and Fixtures 50146
Factory 4203030
Land 2500000
Total 13,627,607

4.2 Financing Plan and Loan Requirement

The partners will each contribute Php 1, 854, 601 cash each except for

one of the partners who has an investment of Php 4, 354, 601. This is due to the

partner’s donation of lot whose fair value is 2.5 million except from his

contribution of cash of 5 million. The researchers see that a loan requirement is

not necessary for the continued operation of the partnership. Whenever there

are instances where capital is needed, the partners will instead make additional

investment.

4.3 Security Loan.

The researchers decided to create partnership as their type of

business so that capital is more easily available. Since all the partners will
 be contributing money and one will contribute even his property, the

researchers do not see any reason for the company to loan capital from

the bank. Therefore, no security loan is needed.

4.4 Profit and Loss Statement

DOG LUGGAGE COMPANY

STATEMENT OF COMPREHENSIVE INCOME
For the period ended 2019-2023
Notes 2019 2020 2021 2022 2023

Sales 1 9,400,218 10,069,514 10,786,463 11,554,459 12,377,137

less: Cost of 2 8,134,087 8,419,990 8,716,533 9,027,904 9,354,844
Sales
Gross Profit 1,266,131 1,649,524 2,069,930 2,526,555 3,022,293
less:
Operating
Expenses
Advertising 3 319,076 307,001 295,530 284,632 274,279
Expense
Auto and 4 30,000 30,000 30,000 30,000 30,000
Truck
Expenses
Pre-operating 5 91,518 0 0 0 0
expenses
HDMF 6 42,432 42,432 42,432
Expense
Miscellaneous 7 0 0 0 0 0
Expense
PHIC Expense 6 19,800 19,800 19,800 19,800 19,800
Rent Expense 734,400 734,400 734,400 734,400 734,400
SSS Expense 6 64,080 64,080 64,080 64,080 64,080
Taxes and 8 3,935 6,860 3,860 3,860 6,860
Licenses
Supplies-Store 9 42,945 42,945 42,945 42,945 42,945
Utilities-store 10 30,000 30,000 30,000 30,000 30,000
VAT on 11 94,800 0 0 0 0
Importation
Travel 12 12,000 12,000 12,000 12,000 12,000
less: Operating 1,484,986 1,289,518 1,275,047 1,221,717 1,214,364
Expenses
Net Income -218,855 360,006 794,883 1,304,838 1,807,929
before Tax
less: Income Tax 0 0 95,386 156,581 216,951
Expense
Net Income -218,855 360,006 699,497 1,148,257 1,590,977
after Tax

4.5 Cash Flow Statement

DOG LUGGAGE PARTNERSHIP

Statement of Cash Flows
For the period ended 2019-2023
Notes 2019 2020 2021 2022 2023
Operating
Activities
Cash 1 9,400,218 10,069,514 10,786,463 11,554,459 12,377,137
received from
customers
Output VAT 13 1,128,026 1,208,342 1,294,376 1,386,535 1,485,256
Add: 268,617 272,097 272,097 272,097 272,097
Depreciation
Expense
Total Cash 10,796,861 11,549,952 12,352,936 13,213,091 14,134,490
Inflows
Cash paid for:
DM -5,916,756
(5,366,031) (6,212,593) (6,523,223) (6,849,384)
DL -724,800 -724,800 -724,800 -724,800
(724,800)
OH
(1,760,833) (1,764,313) (1,764,313) (1,764,313) (1,764,313)
Pre-operating
(91,518) - - - -
advertising
(319,076) (307,001) (295,530) (284,632) (274,279)
auto and
truck (30,000) (30,000) (30,000) (30,000) (30,000)
HDMF -42,432 -42,432
(38,896)
VAT for
importation (94,800) - - - -
miscellaneous
- - - - -
PHIC -19,800 -19,800 -19,800 -19,800
 (18,150)
Rent
(734,400) (734,400) (734,400) (734,400) (734,400)
SSS -64,080 -64,080 -64,080 -64,080
(58,740)
Supplies
(42,945) (42,945) (42,945) (42,945) (42,945)
Taxes and
Licenses (3,935) (6,860) (3,860) (3,860) (6,860)
Travel
(12,000) (12,000) (12,000) (12,000) (12,000)
Utilities-store
(30,000) (30,000) (30,000) (30,000) (30,000)
Input VAT 13
(685,636) (719,526) (755,112) (792,476) (831,709)
Income Tax 0 0 -95,386 -156,581
Payable last
year
VAT Payable SFP -442,391 -488,815 -539,264 -594,059
last year
less: Total
Cash (10,011,760 (10,857,303 (11,220,680 (11,661,179 (12,135,210
Outflows ) ) ) ) )
Total Cash
Flow from 785,101 692,649 1,132,256 1,551,912 1,999,280
operating

Investing
Activities
Purchase of 14
Machineries (1,116,599)
Purchase of 15
Furnitures and (79,444)
Fix
Factory 16
(4,203,030)
Cash Flow 0 0 0
from Investing (5,399,073) -
Activities

Financing
Activities
Contribution
from Partners 11,127,607 - - -
Withdrawals -
 - 600,000 (600,000) (1,200,000) (1,500,000)
Cash Flow
from 11,127,607 (600,000) (600,000) (1,200,000) (1,500,000)
financing
Activities

Cash, beg
- 6,513,635 6,606,284 7,138,540 7,490,452
Add:
Adjustments 6,513,635 92,649 532,256 351,912 499,280
Cash, end
6,513,635 6,606,284 7,138,540 7,490,452 7,989,732

4.6 Balance Sheet

DOG LUGGAGE PARTNERSHIP

STATEMENT OF FINANCIAL POSITION
AS OF YEAR ENDED 2019-2023

Notes 2019 2020 2021 2022 2023

ASSETS
Current Assets
Cash on
hand SCF 6,513,635 6,606,284 7,138,540 7,490,452 7,989,732

Non Current
Assets
Machineries 1,116,599 1,116,599 1,116,599 1,116,599 1,116,599
Accumulated
Dep (78,773) (157,547) (236,320) (315,093) (393,866)
Furnitures and
Fixtures 79,444 79,444 79,444 79,444 79,444
Accumulated
Dep (4,692) (12,864) (21,037) (29,209) (37,381)
Factory
Building 4,203,030 4,203,030 4,203,030 4,203,030 4,203,030
Accumulated
Dep (185,152) (370,303) (555,455) (740,606) (925,758)
Land 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000
Total Assets 14,144,091 13,964,643 14,224,802 14,304,617 14,531,801
LIABILITIES AND
EQUITY
Liabilities
HDMF
Payable 3,536 3,536 3,536 3,536 3,536
PHIC
Payable 1,650 1,650 1,650 1,650 1,650
SSS Payable 5,340 5,340 5,340 5,340 5,340
DM Payable 282,423 296,544 311,371 326,940 343,287
VAT Payable 442,391 488,815 539,264 594,059 653,548
Income tax
pay 0 0 95,386 156,581 216,951

Equity
Benigno,
Capital 1,818,125 1,778,126 1,794,709 1,786,085 1,801,248
C, Capital 1,818,125 1,778,126 1,794,709 1,786,085 1,801,248
Pa, Capital 4,318,125 4,278,126 4,294,709 4,286,085 4,301,248
Pi, Capital 1,818,125 1,778,126 1,794,709 1,786,085 1,801,248
Sa, Capital 1,818,125 1,778,126 1,794,709 1,786,085 1,801,248
Sh, Capital 1,818,125 1,778,126 1,794,709 1,786,085 1,801,248

Total Liabilities and

Equity 14,144,091 13,964,643 14,224,802 14,304,617 14,531,801

Notes:

Note 1:

Total Sales Forecast for Five Years

2019 2020 2021 2022 2023
Sales Forecast 918 955 993 1,033 1,074
Selling Price 10,240 10,547 10,864 11,190 11,525
Total Sales 9,400,320 10,069,623 10,786,580 11,554,584 12,377,271

Note 2:

Cost of Goods Sold

2019 2020 2021 2022 2023 2024

Raw Materials - - - - - -
Beg
Add: Purchases 5,648,454.00 5,930,876.70 6,227,420.54 6,538,791.56 6,865,731.14 7,209,017.70
Raw Materials
5,648,454.00 5,930,876.70 6,227,420.54 6,538,791.56 6,865,731.14 7,209,017.70
Available for Use
Less: Raw
- - - - - -
Materials, End
Raw Materials
5,648,454.00 5,930,876.70 6,227,420.54 6,538,791.56 6,865,731.14 7,209,017.70
Used
Direct Labor 724,800.00 724,800.00 724,800.00 724,800.00 724,800.00 724,800.00
Factory
1,760,833.07 1,764,312.83 1,764,312.83 1,764,312.83 1,764,312.83 -
Overhead
Total
Manufacturing 8,134,087.07 8,419,989.53 8,716,533.36 9,027,904.39 9,354,843.97 7,933,817.70
Cost
Add: Work in
- - - - - -
Process, Beg
Total Goods in
8,134,087.07 8,419,989.53 8,716,533.36 9,027,904.39 9,354,843.97 7,933,817.70
Process
Less: Work in
- - - - - -
Process, End
Cost of Goods
8,134,087.07 8,419,989.53 8,716,533.36 9,027,904.39 9,354,843.97 7,933,817.70
Manufactured
Add: Finished
- - - - - -
Goods, Beg
Total Goods
8,134,087.07 8,419,989.53 8,716,533.36 9,027,904.39 9,354,843.97 7,933,817.70
Available for Sale
Less: Finished
- - - - - -
Goods, End
Cost of Goods
8,134,087.07 8,419,989.53 8,716,533.36 9,027,904.39 9,354,843.97 7,933,817.70
Sold

Note 3:

PROJECTED ADVERTISING EXPENSE

Items Pre-operating 2019 2020 2021 2022 2023

Official Website 351,520 17,576 17,576 17,576 17,576 17,576

E-banner 15,000 60,000 60,000 60,000 60,000 60,000

Brochure and
flyers 15,375 61,500 58,425 55,504 52,729 50,092
Newspaper
Publication 45,000 180,000 171,000 162,450 154,328 146,611
Total Advertising
Expense 426,895 319,076 307,001 295,530 284,632 274,279

Note 4:

PROJECTED AUTO AND TRUCK EXPENSES

Pre-
Items operating 2019 2020 2021 2022 2023
Gasoline
Expense 4,500 18,000 18,000 18,000 18,000 18,000

Travel Expense 3,000 12,000 12,000 12,000 12,000 12,000

Total Auto and
Truck expenses 7,500 30,000 30,000 30,000 30,000 30,000

Note 5:

Other Pre-operating expenses

Organizational Activity Amount
BIR Registration Form 500
Community Tax Certificate 500
SEC Registration 4500
Legal Fee 450
Documentary Stamp 25
Depreciation Expense 19693
Business Name Registration 500
Employees Seminars and Training 10000
Renovation Expense 50000
Hiring Expense 5000
Notary Public Fee 350
Total 91,518

Note 6:

GOVERNMENT PREMIUM EXPENSE

Item Pre-operating 2019 2020 2021 2022 2023
HDMF Premium 10608 42432 42432 42432 42432 42432
PHIC Premium 4950 19800 19800 19800 19800 19800
SSS Premium 16020 64080 64080 64080 64080 64080
Total HDMF, PHIC,
SSS Expenses 31578 126312 126312 126312 126312 126312

Note 7:

PROJECTED MISCELLANEOUS EXPENSE

Items Pre-operating 2019 2020 2021 2022 2023
Factory workers uniform 960 0 0 0 0 0
Office workers uniform 1820 0 0 0 0 0
sales men uniform 360 0 0 0 0
Total Miscellaneous 3140 0 0 0 0 0

Note 8:

Taxes and Licences

Items Pre-operating 2019 2020 2021 2022 2023 2024

Mayors Permit 1,000 1,000 1,000 1,000 1,000 1,000 1,000

Inspection Fees 200 200 200 200 200 200 200

Sanitary Fees 100 100 100 100 100 100 100

Garbage Fees 500 500 500 500 500 500 500

Permit Fee on Ocction 1,000 1,000 1,000 1,000 1,000 1,000 1,000

Zoning Clearance Fee 75 75 - - - - -

Business plate/ Stickers
Fee 10 10 10 10 10 10 10

Provincial Fee 50 50 50 50 50 50 50

BIR renewal 500 500 500 500 500 500 500

DTI renewal 500 500 500 500 500 500 500

LTO renewal - 0 3000 - - 3,000 -

Total Taxes and
Licences 3,935 3,935 6,860 3,860 3,860 6,860 3,860
Note 9:

Supplies Expense

pre-operating 2019 2020 2021 2022 2023

Retail Store Supplies 2,625.00 10,500.00 10,500.00 10,500.00 10,500.00 10,500.00

Manufacturing Supplies 5,557.75 22,231 22,231 22,231 22,231 22,231

Office Supplies 7,932.00 31,728 31,728 31,728 31,728 31,728

Other Supplies 179.25 717 717 717 717 717

Total Supplies 16,294.00 65,176 65,176 65,176 65,176 65,176

Note 10:

PROJECTED UTILITIES EXPENSE-RETAIL STORE

Pre-
Items operating 2019 2020 2021 2022 2023 2024

Electricity 7,500.00 30,000 30,000 30,000 30,000 30,000 30,000

Total Utilities Expense 7,500.00 30,000 30,000 30,000 30,000 30,000 30,000

Note 11:

Vat on I mportation 94800

Cash 94800

Note 12:

PROJECTED TRAVEL EXPENSE

Pre-
Items operating 2019 2020 2021 2022 2023
Travel expense 3000 12000 12000 12000 12000 12000
Total Travel expense 3000 12000 12000 12000 12000 12000

Note 13:

2019 2020 2021 2022 2023

Output VAT 1128038.4 1208354.73 1294389.59 1386550.13 1485272.499
Input VAT from
 DM 677,814.48 711,705.20 747,290.46 784,654.99 823,887.74

Input VAT from supplies 7,821.12 7,821.12 7,821.12 7,821.12 7,821.12

less:TOTAL input vat 685,635.60 719,526.32 755,111.58 792,476.11 831,708.86

VAT Payable 442,402.80 488,828.41 539,278.01 594,074.02 653,563.64

Note 14:

QTY UNIT TOTAL COST

PRICE
MANUFACTURING EQUIPMENT -
Conveyor Belt 2
395,000 790,000
OTHER EQUIPMENT -
Fire Extinguisher 2
2,500 5,000
Push Cart heavy duty 1
4,799 4,799
Generator 1
16,800 16,800
TRANSPORTATION EQUIPMENT -
Delivery Truck 1
300,000 300,000
TOTAL MACHINERIES
1,116,599

Note 15:

QTY UNIT TOTAL COST

PRICE
STORE EQUIPMENT
Desktop Computer 1 18999 18999
Receipt Printer 1 3500 3500
Code Scanner 1 2000 2000
Cart 1 4799
4,799
OFFICE EQUIPMENT -
Office Chair 10
549 5,490
Office Table 10
2,166 21,660
Desktop Computer 1
18,999 18,999
Printer 1
2,500 2,500
File Cabinet 3
499 1,497
TOTAL FURNITURES AND
FIXTURES 79,444

4.7 Loan Repayment Schedule (what is the loan repayment schedule)

Since the researchers did not use Loan Financing as its type of capital financing,

there is no need for a loan repayment schedule.

4.8 Break-even Point (BEP) what is the break-even point)

Break Even Point

2019 2020 2021 2022 2023 2024

Selling Price 10,240 10,547 10,863 11,189 11,525 16,193

Variable Cost 6,968 6,795 6,832 6,872 6,914 7,849

Contribution
Margin 3,272 3,752 4,031 4,317 4,611 8,344

Fixed Cost 3,264,033 3,264,033 3,264,033 3,264,033 3,264,033 3,264,033

Contribution
Margin per
unit 3,272 3,752 4,031 4,317 4,611 8,344

BEP (in units) 998 870 810 756 708 391

4.9 Return on Investment (ROI)

2018 2019 2020 2021 2022

Net Income
(218,753) 360,115 699,600 1,148,367 1,591,095
Average Total Assets
14,054,434 14,094,903 14,265,005 14,418,621 7,266,136
Return on Investments -1.56% 2.55% 4.90% 7.96% 21.90%

4.10 Financial Analysis

2019 2020 2021 2022 2023

Quick asset
6,513,647 6,606,406 7,138,779 7,490,804 7,990,204

Total Liabilities
735,352 795,898 956,575 1,088,135 1,224,344

Quick Ratio
8.86 8.30 7.46 6.88 6.53

2019 2020 2021 2022 2023

Current Assets
6,513,647 6,606,406 7,138,779 7,490,804 7,990,204

Current Liabilities
735,352 795,898 956,575 1,088,135 1,224,344

Quick Ratio
8.86 8.30 7.46 6.88 6.53

2019 2020 2021 2022 2023

Gross Profit
1,266,233 1,649,633 2,070,047 2,526,680 3,022,427

Net Sales
9,400,320 10,069,623 10,786,580 11,554,584 12,377,271

Gross Profit Margin 13.47% 16.38% 19.19% 21.87% 24.42%

 2019 2020 2021 2022 2023

Net Income
(218,753) 360,115 699,600 1,148,367 1,591,095

Net Sales
9,400,320 10,069,623 10,786,580 11,554,584 12,377,271

Net Profit Margin -2.33% 3.58% 6.49% 9.94% 12.85%

2019 2020 2021 2022 2023

Sales
9,400,320 10,069,623 10,786,580 11,554,584 12,377,271
Average Total Assets
14,054,434 14,094,903 14,265,005 14,418,621 7,266,136
Asset turnover 66.89% 71.44% 75.62% 80.14% 170.34%

2019 2020 2021 2022 2023

Net Income
(218,753) 360,115 699,600 1,148,367 1,591,095

Ave. Total Assets

14,054,434 14,094,903 14,265,005 14,418,621 7,266,136

Return on Assets -1.56% 2.55% 4.90% 7.96% 21.90%

4.11 Is the project feasible

It is normal for a starting company to incur loss on its first year of

operations. Since the business is just emerging, different factors like the actual

number of customers, sales, and production are still being determined by the

company.

But as we see in the projected statement of comprehensive income, the

net income of the company is gradually increasing from the second to the sixth

year. The return on investment even doubles its rate every year.
 From the different aspects being presented and considered above, the

researchers believe that the creation of this electromagnetic controlled

luggage (dog luggage) is feasible.