PAMANTASAN NG LUNGSOD NG MUNTINLUPA

College of Business Administration

Jenny Rose Tuyan

Liza Lorenz Cruz

Mark Kenneth Acosta

Submitted to:

Ms. Jempol Mae R. Corpuz, MBA

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College of Business Administration

APPROVAL SHEET

This feasibility study entitled OPTION Manufacturing Company prepared and

submitted by Jenny Rose Tuyan, Liza Lorenz Cruz, and Mark Kenneth Acosta,in partial
fulfillment of the requirements for the degree of BS Business Administration Major in
Operations Management.

Has been examined and recommended for acceptance and approval for oral
defense.

Jempol Mae R. Corpuz, MBA

Adviser

FEASIBILITY REVIEW PANEL

Approved by the Committee on Oral Examination with a grade of ______.

Fe S. Dullavin, MBM Catherine H. Rasing, CPA

Member Member

Ramonito A. Mesina, MBA

Chairman

Accepted and approved in partial fulfillment of the requirements for the degree of
BS Business Administration.

Ramonito A. Mesina, MBA

OIC, College of Business Administration

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ACKNOWLEDGMENT

This study would have not been made possible if not for the invaluable

assistance and support by the following:

Firstly, we would like to thank our beloved Creator Almighty God Yahweh

for giving us the opportunity to learn, discover and explore life.

We would like to thank our family, especially our parents and to our brothers and

sisters for supporting us spiritually and financially throughout writing this thesis

and our daily life in general.

Furthermore, we would like to thank our research professor, Ms. Jempol

Mae Corpuz, MBA for guiding, teaching and supporting us in this feasibility study.

We would like give thanks to our fellow classmates, for the sleepless nights we

were working together before deadlines, and for all the fun we had.

Lastly, we want to give thanks to our friends who contributed their

knowledge for the purpose of this research study.

-The researchers

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DEDICATION

This humble work

is dedicated

to whom all springs from,

and to whom all glory

must be returned,

Him,

The Alpha and the Omega,

our Creator,

our God,

Yahweh.

-The researchers

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College of Business Administration

TABLE OF CONTENTS

Title Page i

Approval Sheet . ii

Acknowledgment . iii

Table of Contents . v

Executive Summary . ix

CHAPTER PAGE

1 PRELIMINARY SECTIONS 1

1.1 Introduction 1

1.2 Background of the Study 3

1.3 Statement of the Problem 5

1.4 Scope and Limitation 8

1.5 Definition of Terms 9

1.6 Research Methodology 10

2 MARKET STUDY 12

2.1 Business Description 13

2.2 Product/ Service Description 15

2.3 Target Market 18

2.4 Demand Analysis 31

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2.5 Competition and Industry Analysis 45

2.6 Marketing and Sales Strategy 57

2.7 Conclusion of Market Study 76

3 TECHNICAL AND OPERATION STUDY 77

3.1 Production Technology 77

3.2 Technical and Production 83

3.3 Manufacturing/ Merchandising and

Service Process 114

3.4 Prototype 127

3.5 Conclusion of Technical Operation Study 129

4 ORGANIZATIONAL OR MANAGEMENT STUDY 130

4.1 Business Forms and Key Personnel 130

4.2 The Organizational Chart 137

4.3 Manpower and Skills Requirements 138

4.4 Compensation and Benefits 143

4.5 Employment Process 149

4.6 Personal Employment Record 154

4.7 Contracts of Employment 172

4.8 Work or Shifting Schedule and Meal

and Rest Periods 176

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5 FINANCIAL STUDY 187

5.1 Initial Project Cost 187

5.2 Sources of Financing 188

5.3 Financial Assumptions 188

5.4 Projected Manpower 193

5.5 Property and Equipment Depreciation Schedule 195

5.6 Cost of Goods Sold 203

5.7 Income Statement 204

5.8 Cash Flows Statement 205

5.9 Statement of Financial Position 206

5.10 Ratio Analysis 207

6 LEGAL STUDY 210

6.1 Business Registration 215

6.2 Patents, Copyrights and Trademarks 223

6.3 Licensing Agreement / Patent Agreement 226

6.4 Taxation 229

7 SOCIO-ECONOMIC STUDY 235

7.1 Contributions to the Philippine Economy 235

7.2 Employment Generation 235

7.3 Environment Conservation 236

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7.4 Conclusion of Socio-Economic Study 237

8 FINAL FINDINGS AND RECOMMENDATIONS/CONCLUSIONS

8.1 Findings 238

8.2 Recommendations 238

8.3 Conclusion 239

BIBLIOGRAPHY

APPENDICES

List of Figures

Figure 1 Framework of the Study 8

Figure 2 Business Logo A 15

Figure 3 Business Logo B 15

Figure 4 OPTIONs Handkerchief 17

Figure 5 New Concept -A 18

Figure 6 New Concept -B 18

Figure 7 New Concept -C 18

Figure 8 New Concept -D 18

Figure 9 Alabang Town Center 19

Figure 10 Alabang Town Center Logo 19

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Figure 11 Vicinity Map 21

Figure 12 Satellite View of Alabang Town Center 21

Figure 13 Market Share of OPTION 53

Figure 14 Apostrophe's Logo 60

Figure 15 Apostrophe's Actual Store 60

Figure 16 Broadway Gems' Logo 61

Figure 17 Broadway Gem's Actual Store 61

Figure 18 Cache Cache's Logo 61

Figure 19 Cache Cache's Actual Store 61

Figure 20 DAISO Japan 61

Figure 21 DAISO Japan's Actual Store 61

Figure 22 Evita Peroni's Logo 62

Figure 23 Evita Peroni's Actual Store 62

Figure 24 Hobbes & Landes' Logo 62

Figure 25 Hobbes & Landes' Actual Store 62

Figure 26 JOI Boutique's Logo 62

Figure 27 JOI Boutique's Actual Store 62

Figure 28 Girbaud's Logo 63

Figure 29 Rustan's Logo 63

Figure 30 Rustan's Actual Store 63

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Figure 31 STORE ONE's Logo 63

Figure 32 STORE ONE's Actual Store 63

Figure 33 The Gift Factory's Logo 64

Figure 34 The Gift Factory's Actual Store 64

Figure 35 Tickels Actual Store 64

Figure 36 Sample Flyer 66

Figure 37 Sample Tarpaulin 67

Figure 38 OPTION Facebook Page 68

Figure 39 Twitter Account 68

Figure 40 Instagram Account 69

Figure 41 Facility Layout- First Floor 98

Figure 42 Facility Layout- Second Floor 98

Figure 43 Actual First Floor 99

Figure 44 Actual First Floor 100

Figure 45 Location Map of the Head Office 101

Figure 46 Factory Worker's Uniform 113

Figure 47 Personnel's Uniform 113

Figure 48 OPTION's ID Lay-out 114

Figure 49 Bonded Warehousing Services 125

Figure 50 Prototype A 128

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College of Business Administration

Figure 51 Prototype B 128

Figure 52 Prototype C 128

Figure 53 Prototype D 128

Figure 54 Prototype E 129

Figure 55 Prototype F 129

Figure 56 Prototype G 129

Figure 57 Prototype H 129

Figure 58 Prototype I 129

Figure 59 Prototype J 129

Figure 60 Organizational Chart 138

Figure 61 G.M. 201 File A 155

Figure 62 G.M. 201 File B 156

Figure 63 G.M. 201 File C 157

Figure 64 Marketing Personnel's Profile 158

Figure 65 Marketing Personnel's Profile -A 159

Figure 66 Production Head's Profile 160

Figure 67 Production Head's Profile -A 161

Figure 68 Factory Worker (1) Profile 162

Figure 69 Factory Worker (1) Profile A 163

Figure 70 Factory Worker (2) Profile 164

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College of Business Administration

Figure 71 Factory Worker (2) Profile A 165

Figure 72 Factory Worker (3) Profile 166

Figure 73 Factory Worker (3) Profile A 167

Figure 74 Distributor Profile 168

Figure 75 Distributor Profile -A 169

Figure 76 Driver Profile 170

Figure 77 Driver Profile A 171

Figure 78 Maintenance's Profile 172

Figure 79 Employment Contract -A 173

Figure 80 Employment Contract -B 174

Figure 81 Employment Contract -C 175

Figure 82 Employment Contract -D 176

Figure 83 Appraisal Form 182

Figure 84 Gantt Chart 186

Figure 85 S.E.C Certificate 216

Figure 86 Barangay Business Permit 217

Figure 87 Annual Community Tax Certificate 218

Figure 88 Business Permit 219

Figure 89 BIR Registration 220

Figure 90 S.S.S Registration 221

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Figure 91 PhilHealth Registration 222

Figure 92 Pag-ibig Registration 223

Figure 93 Patent Registration 224

Figure 94 Patent Registration -B 225

Figure 95 Patent Registration -C 226

Figure 96 Copyright Registration 227

Figure 97 Trademark Registration 228

Figure 98 Trademark Registration -B 229

Figure 99 BIR Form 1901 231

Figure 100 BIR Form 1901 -A 232

Figure 101 BIR Form 1906 233

Figure 102 DTI Certificate 234

List of Tables

Table 2.1 Gender of the Respondents 26

Table 2.2 Age of the Respondents 26

Table 2.3 Educational Attainment of the Respondents 26

Table 2.4 Monthly Household Income of the Respondents 27

Table 2.5 Residential Place of the Respondents 27

Table 2.6 Number of Respondents Interested

in Handkerchief 28

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College of Business Administration

Table 2.7 Number of Respondents Preference

choice in a Handkerchief 28

Table 2.8 Number of Respondents who desire

such kind of handkerchief 28

Table 2.9 Number of Respondents who

purchase a handkerchief 29

Table 2.10 Number of Frequency the Respondents

buy a Handkerchief 29

Table 2.11 Place where the Respondents buy

a Handkerchief 29

Table 2.12 Place where the Respondents

buy a Handkerchief 30

Table 2.13 Preferred Features that the Respondents

usually seek 30

Table 2.14 Benefits that the Respondents look

for in a Handkerchief 30

Table 2.15 Respondents Motivation to purchase

a handkerchief 31

Table 2.16 Potential Demand of OPTION 33

Table 2.17 Actual Demand of OPTION 34

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Table 2.18 Future Demand 35

Table 2.19 For every concept of the product 36

Table 2.20 Actual Supply 38

Table 2.21 Projected Annual Supply 39

Table 2.22 Projected Supply 40

Table 2.23 Evolution of Demand 42

Table 2.24 Evolution of Demand 42

Table 2.25 Evolution of Demand 2.0 44

Table 2.26 Evolution of Demand 3.0 45

Table 2.27 TOWS Analysis of Handkerchief Industry 49

Table 2.28 TOWS Analysis of OPTION

Manufacturing Company 50

Table 2.28 Determining Actual Market Share &

Sales Per Unit 52

Table 2.29 Actual Sales for 2016 53

Table 2.30 Direct Competitors 55

Table 2.30 Indirect Competitors 55

Table 2.31 Indirect Competitors 55

Table 2.32 Indirect Competitors 55

Table 2.33 Product Prices 65

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Table 3.0 Machines and Equipment 78

Table 3.1 Automobile 81

Table 3.2 Plain Design Handkerchief 84

Table 3.3 Printed Design Handkerchief 87

Table 3.4 Artistic Design Handkerchief 89

Table 3.5 Hemstitched Design Handkerchief 92

Table 3.6 Classic Design Handkerchief 94

Table 3.7 Price Rate 97

Table 3.8 Leasehold Improvements 102

Table 3.9 Transportation Mode 103

Table 3.10 Furniture & Fixtures 104

Table 3.11 Office Supplies 106

Table 3.12 Factory Supplies 108

Table 3.13 Amenities 110

Table 3.14 Direct Raw Materials 112

Table 3.15 Actual Manufacturing Process 116

Table 3.16 Labor and Machine/Tools Requirement Tools 120

Table 3.17 Production Schedule and Volume 121

Table 3.18 Shifts Planned 121

Table 3.19 Cost per Unit of Plain Handkerchief 122

Table 3.20 Cost per Unit of Printed Handkerchief 122

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Table 3.21 Cost per Unit of Artistic Handkerchief 123

Table 3.22 Cost per Unit of Hemstitched Handkerchief 123

Table 3.23 Cost per Unit of Classy Handkerchief 124

Table 3.24 Electricity Expense-Office 126

Table 3.25 Water Expense 126

Table 4.0 Partners Personal Profile 132

Table 4.1 Salaries and Wages 144

Table 4.2 Regular and Special Holidays 146

Table 4.3 Benefits 140

Table 4.4 Working Days 177

Table 4.5 Disciplinary Action 185

Table 6.0 List of Requirements 221

Table 6.1 Value Added Tax 230

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EXECUTIVE SUMMARY

A. Project Background

OPTION. The choice is yours is a new accessory manufacturing company

that offers a new brand of handkerchief with Italian design, Japanese quality

standard and Philippine-made materials such as fine cotton and Abel fabric. It is

newly established by three (3) young entrepreneurs.

B. Market Study

This marketing aspect involves the specification of the demand and supply of

the product. The aim of the market study is to tell apart the specific demand of

the product in our target market while giving them corresponding supply with high

quality at a logical price.

C. Technical and Operations Study

This aspect of the study shows the process and manufacturing procedure

in making the product. It indicates the different equipment and machineries that

will be used for the production and the probable layout plant.

D. Management/ Organizational Study

This aspect explains the number of personnel needed to obtain productive

operations and their compensation. It also shows the job specification and

description to acquire the needed requirements in the business.

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E. Financial Study

This aspect shows the financial statement of the business and its

schedule that can affect its operation. It shows how the business is profitable and

shows to the entrepreneurs the stability of the financial status.

F. Legal Study

The legalities, the procedures, and registration of OPTION are discussed in

this aspect. The trademarks, patent, and copyrights are included in this study to

provide security of the business, its originality and rights as an entity. Identifies

the accountabilities and obligations of the business.

G. Socio-Economic Aspect

The contribution of the proposed project in the Philippine government was

being discussed in this aspect. How the proposed project envisioned to generate

employment and as a source of profit, and also geared toward the economic

uplift men of the people who are directly and indirectly related to the business.

H. Final Findings and Recommendations/Conclusions

Based on the data that proponents gathered, the proponents can say that the

business is feasible and profitable as well because of many factors including the

location of the business, demand and supply and the estimated market share

that they have studied.

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