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Kingfisher School of Business and Finance

1799 McArthur Highway Lucao District, Dagupan City, 2486

FEASIBILITY STUDY PROPOSAL

Proponents:

Mandapat, Ryan M.

Rodriguez, Dominique S.

Versoza, Julius Ericson M.

Frialde, April Joyce P.

Melendez, Heidi F.

Sison, Hazel D.

Soriano, Sharmaine Mutya S.

Talagtag, Princess Abeze C.

Research Adviser:

Ms. Maybelle Ann Lopez, MBA


Kingfisher School of Business and Finance

Table of Contents
Executive Summary .................................................................................................................. 4
I. Introduction ............................................................................................................................ 6
A. Company Overview ....................................................................................................... 6
B. Vision ............................................................................................................................. 9
C. Mission .......................................................................................................................... 9
D. Objectives ...................................................................................................................... 9
E. History.......................................................................................................................... 10
F. Products ...................................................................................................................... 10
G. Location Profile ............................................................................................................ 14
H. SWOT Analysis............................................................................................................ 15
II. Industry Analysis ................................................................................................................ 20
A. Industry Overview ........................................................................................................ 20
B. Supply .......................................................................................................................... 22
C. Demand ....................................................................................................................... 23
D. Porter’s Five Forces Model .......................................................................................... 25
D.1 Bargaining Power of Suppliers .......................................................................... 25
D.2 Bargaining Power of Customers ........................................................................ 26
D.3 Threat of New Entrants ..................................................................................... 28
D.4 Threat of Substitutes ......................................................................................... 29
D.5 Competitive Rivalry between Existing Players ................................................... 31
E. Competitors’ Profile ...................................................................................................... 32
F. Suppliers’ Information................................................................................................... 39
III. Review of Related Literature ............................................................................................. 42
IV. Marketing Feasibility ........................................................................................................ 45
A. Consumer’s Analysis ................................................................................................ 45
B. Marketing Mix ........................................................................................................... 49
V. Technical Feasibility .......................................................................................................... 58
A. Production Process .................................................................................................. 58
B. Flowchart of Activities ............................................................................................... 62

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C. Gantt Chart .............................................................................................................. 65


D. Facility Layout ........................................................................................................... 67
E. Initial Investment ...................................................................................................... 76
F. Economies of Scale .................................................................................................. 76
VI. Management Feasibility ................................................................................................... 77
A. Management Team .................................................................................................. 77
B. Organizational Structure ........................................................................................... 78
C. Job Description and Specification ............................................................................ 79
D. Shifting Schedule ..................................................................................................... 81
VII. Financial Feasibility ......................................................................................................... 82
A. Financial Assumption ............................................................................................... 82
B. Financial Statements ................................................................................................ 86
C. Notes to Financial Statements ................................................................................. 88
D. Financial Ratios and Analysis .................................................................................. 93
VIII. Conclusion ........................................................................................................................ 9
IX. Appendices ........................................................................................................................ 97
Appendix A: Letter to Ice cream shop owner .................................................................... 98
Appendix B: Letter to Department of Trade and Industry .................................................. 99
Appendix CArticles of Partnership ................................................................................. 100
Appendix D:Contract of Lease ........................................................................................ 104
Appendix E: PAG-IBIG Contribution Table .................................................................... 111
Appendix F:SSS Contribution Table .............................................................................. 112
Appendix G. Philhealth PremiumContribution Table ................................................... 113
Appendix H.Current Daily Minimum Wage ..................................................................... 114
Appendix I:Survey form .................................................................................................. 115
Appendix J: Tabulation of Survey .................................................................................. 117
Appendix K: Pie Graph .................................................................................................. 123
Appendix L: Number of Persons and Vehicles in the Location ....................................... 122
Appendix M: Business Permits ....................................................................................... 124
Appendix N: List of Ice Cream Parlors in Dagupan City .................................................. 126
Appendix O: Ice Cream Hub’s Logo ............................................................................... 122

X. References ........................................................................................................................ 128

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Executive Summary

The Ice Creamistry Hub is an ice cream enterprise that showcases flavors representing

the best products of Pangasinan. Included in its formulation is the infusion of liquid nitrogen that

has a temperature of -321˚F enabling to flash freeze the ice cream mixture. The business will be

organized by the proponents as a General Partnership and will be established in Burgos

Extension, Dagupan City. Its target market comprises of the students, families and working

professionals with middle to high income. The business is guided by its vision statement which

is “Ice Creamistry Hub envisions to be the leading and most popular ice cream shop in

Pangasinan.” In attaining this, its mission statement is “To delight and serve customers with the

finest quality liquid nitrogen ice cream that comes in a wide variety of flavors promoting the best

of Pangasinan.”

Understanding the market, the business is to be classified in the Frozen Food Industry

particularly in the Frozen Dessert Industry. Selecta is the leading player in this industry having

80 percent of the market share.Also, establishments of Liquid Nitrogen Ice cream businesses

such as Iscreamist and Seventh Element in Metro Manila have emerged having students and

people who are outgoing and adventurous as their target market.

The supply and demand analysis in its target market both show equal amounts when it

comes to the traditional ice cream. However, due to the infusion of liquid nitrogen, the analysis

will differ. This is supported by an interview conducted with the Seventh Element disclosing a

gap between supply and demand of 252 kilograms per month

Ice Creamistry Hub hub’s target market comprises high school and college students in

Dagupan City aging from 12-21 years old and working people aging 22-50 with middle to high

monthly allowance or income. Various kinds of flavors like Classic Flavors, Premium Flavors

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Kingfisher School of Business and Finance

and Best of Pangasinan Flavors will be offered. The business will set its price using

valuebasedpricing ranging from Php75-Php90 per (8oz cup). It will be adopting a direct

distribution channel since it will be serving its product to final consumers.

Product preparation begins before business hours in order to make the mixture. When

the shop opens, customers make an order. Their desired mixture is infused with liquid nitrogen

and served.

Different promotional activities will be engaged throughout the year. This would include

transit ads, lamp post banners, social media, coupons and free taste. Since business is still

unknown, the first year would incur much advertising cost as compared to the following periods.

The business will be operated and managed by Hazel Sison and Heidi Melendez. These

partners are capable in running the business because of their experience in making ice cream

and being witness to the actual process of making liquid nitrogen ice cream. Also, they have

acquired substantial business concepts during their collegiate years and will attend trainings,

seminars and activities in order to be more competent in managing the business.

The company has its estimated initial investment of Php797,612.57 which mainly

consists of machineries and equipment, materials and ingredients, business requirements and

pre-operating expenses, and leasehold improvement, and other operating expenses. The net

incomes for year 1 to year 5 are PHP 507,181, PHP 605,866, PHP 455,418, PHP 506,771

and PHP 542,605 respectively.

Given these necessary information and carefully studying the business’ industry and

market, it gives an understanding of the competitive landscape. Through this, the business will

reasonably be able to cope up with the changes in the market and in meeting its customers

changing wants and needs.

Therefore, the proponents have reason to believe that this business study is feasible.

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I. Introduction

The Ice Creamistry Hub is an ice cream shop that showcases flavors representing the best

products of Pangasinan. Included in its formulation is the infusion of liquid nitrogen. Liquid

nitrogen is a liquefied gas that has a temperature of -321˚F which enables it to flash freeze the

ice cream mixture. Utilizing this liquid nitrogen makes the ice particles smaller, thus resulting to

a smoother and denser ice cream.

The purpose of this study is to provide new and healthy flavors to customers while

enjoying the smoke caused by liquid nitrogen. Offering made to order ice cream, customers can

have their own customized ice cream instantly. Through the distinctive flavors, taste and

experience that will be offered, the business is confident that it will be something that customers

will come back for and will be a chance in gaining their loyalty in the long run.

To help the customers feel better and be relieved from their daily struggles, the business

will make the ambiance of the place fun and relaxing. The establishment has designed its

interior in a way that gives customers a sense of enjoyment and relaxation. It has implemented

some of the basic concepts of interior design which includes balance, harmony and unity,

proportion and scale, and color to impact emotion.

A. Company Overview

The Ice Creamistry Hub is a local business that aims to bring the best of ice

cream from the different cities and municipalities in the province of Pangasinan. Flavors

to be offered includes “Mango Tango” featuring the sweet carabao mangoes of San

Carlos City, “Sea Salt Caramel” from the municipality of Dasol, “Maiz con Keso”

showcasing the sweet corn of San Jacinto and “Pandan con Leche” from Mapandan.

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Also, during the rainy seasons it offers its limited-edition flavors such as Strawberry-

Jalapeno.

It is an establishment that provides liquid nitrogen infused ice cream in the

province. In its pursuit of providing its consumers a healthier and freshly made ice

cream, the enterprise has liberated itself from the traditional methods of ice cream

preparation. Rather than using machines, it will utilize liquid nitrogen with -321 degrees

Fahrenheit. With its very low temperature, it can freeze the ice cream in few minutes

lessening the formation of ice crystals which results to a creamier and denser ice cream.

The business will be classified as part of Frozen Food Industry particularly in the

Frozen Desserts Industry. It will be organized and managed by the proponents in the

form of a general partnership. Further, the business will be located inBurgos Extension,

Dagupan City near the EDNAS School and University of Luzon. The proponents

consider this place as a strategic location since it is near not only to the company’s

suppliers but also to other establishments like schools, universities, hospitals and

different business enterprises. The potential size of the market will include families,

students and working professionals earning middle to high incomes.

The Ice Creamistry Hub derived its

name by combining the words “ice cream”

and “chemistry”. The word “ice cream”

represents itself in the name as the

establishment’s main product. The

“chemistry”, on the other hand, is in

reference to one of the product’s major

Figure 1.1 Company logo ingredient which is the liquid nitrogen. The

enterprise portrays in its logo the business’ name with an ice cream scoop above. From

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the logo, smoke can be seen coming out of the ice cream. This is in depiction of the

liquid nitrogen converting to gas as it is used in the mixture.

Engaging in this business will require an approximated initial investment of

Php800,000 and will yield an approximate 12% annual return on capital. According to

Joaquin Soriano, owner of the Seventh Element Ice cream shop, he was able to recover

its investment within 4 months.

INITIAL INVESTMENT

Materials and Ingredients 285,892.30

Machineries and Equipment 257,570.00

Business Requirements and pre-operating expenses 11,155.60

Leasehold Improvement 212,093.50

**Other operating expenses 30,901.17

TOTAL INITIAL INVESTMENT 797,612.57


Table 1.1 Breakdown of Initial Investment

NOTE: For the extensive breakdown of the initial investment, see the Financial

Statement.

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B. Vision Statement

Ice Creamistry Hub envisions to be the leading and most popular ice cream shop

in Pangasinan.

C. Mission Statement

To delight and serve customers with the finest quality liquid Nitrogen ice cream

that comes in a wide variety of flavors promoting the best of Pangasinan.

D. Objectives

General:

The business aims to gain the majority share of the ice cream market in

Pangasinan.

Specific:

 To raise customer awareness of the product’s existence through the use

of different advertising tools such as transit ads, banners and social

media.

 To build up brand loyalty and public relations as it gains exposure to the

market.

 To earn at least a 10% annual return of investment by performing

operations efficiently and effectively at the lowest possible cost without

sacrificing the quality.

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E. History

According to Christopher Hall (2005), in year 1987, a microbiologist in Lexington

got the idea of flash freezing the ice cream with the use of liquid nitrogen, a chemical he

was familiar with from working in his lab. This was the start of the “ice cream of the

future”, which was frozen by spraying ice cream mix into a cryogenic freezer. After then,

the “mad scientists” discovered their breakthrough invention and have made a better

homemade ice cream than they ever had before. Upon the discovery of this liquid

nitrogen ice cream, and a year thereafter, a new ice cream shop called the Blue-Sky

Creamery opened its ice cream parlor in Ankeny, Lowa to try the innovative way of

preparing ice cream.

As time passed by, people have loved the new taste and experience of eating

their ice creams. By having a stable standing in the market, it established its first

franchise store in Minnesota. Also, with the increasing demand for their unique ice

cream, they expand their market in different nations by offering different varieties of ice

cream which is also available online (Hall, 2005).

F. Products/Description

The establishment will primarily offer liquid

nitrogen ice cream to its customers. Basic inputs

of this product include fruits, milk, cream, sugar,

salt, liquid nitrogen and other ingredients that

vary according to flavor. As more people tend to

become more health conscious, the entity

Figure 1.2 Sea Salt Caramel Ice Cream

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responds by using fresher ingredients that prevent the need for emulsifiers and

stabilizers as compared to commercially manufactured ice creams.

The method of preparing the ice cream differs from other establishments. The

common way of making ice cream involves the use of large machines, but for this ice

cream preparation, liquid nitrogen is used.

Figure 1.3 Preparation of Liquid Nitrogen Ice Cream

Liquid nitrogen is a gas converted into a liquid state. It has a temperature

reaching -321 degrees Fahrenheit. Due to its very low boiling point, it has the ability to

fast freeze anything that it comes in contact with. With this, the ice cream mixture can be

frozen within 5 minutes. Having this setup, the enterprise is able to prepare freshly made

ice cream as the customer orders.

It starts with a liquid base composing of milk, cream, sugar and salt. Thereafter,

other ingredients are added that vary according to flavor. The liquid nitrogen is mixed

along with the mixture for it to freeze. The ice cream is then served immediately to

consumers in a cup.

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Here are some of the distinctions of Liquid Nitrogen Ice Cream from other ice cream:

Liquid Nitrogen Traditional Gelato Commercial


Ice Cream Ice Cream Ice Cream

Illustration

fresh milk, fruits,


whipping cream, sugar, Milk, sugar, cream, and
Main Ingredients and liquid nitrogenfresh additives e.g. calcium
milk, fruits, whipping Egg yolk, sugar, milk, sulfate, magnesium,
cream, sugar, and liquid cream, and flavorings potassium sorbate
nitrogen

Price per cup P150 – P200 P100 – P155 P45-150

Lack of suppliers in the


country, with Metro Numerous supplies in Numerous supplies in
Availability Manila and Quezon City supermarkets and supermarkets and
as the only branches convenience stores convenience stores

Texture Smoother and creamier Denser Smooth

Freezing

AgentFreezing Emulsifiers and Emulsifiers and


Liquid nitrogen
stabilizers stabilizers
Agent

Mandapat,
Table 1.2 R., Rodriguez,of
Difference D.,Liquid
Versoza,Nitrogen
J.E., Frialde, A.J.,other
from Melendez, H.,Sison, H.,Soriano,S.M., Talagtag, P.A
Ice Creams 12
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Freezing Period

(Minimum) 5 minutes 30 minutes 2 hours

Freezing Point
-321 degrees 15 degrees 7 - 12 degrees
(Fahrenheit)

The integration of liquid nitrogen in making the ice cream poses numerous

benefits attributable to the ice cream. First, this unique procedure allows the fat and

water particles to remain small resulting to a creamier, smoother and tastier ice cream.

Second, due to it’s on the spot preparation, preservatives are avoided in the formulation

thereby allowing the product to become a healthier counterpart of manufactured ice

cream. Third, it allows the fresh ingredients’ nutrient-value to be retained. Lastly,

liquefied gases’ characteristic can be used to let the customers experience smoky and

misty ice cream eating by dipping the ice cream toppings in the liquid Nitrogen. These

gives the customers an opportunity to interact while indulging with the ice cream and to

establish a bond with both the product and brand.

Another feature of Ice Creamistry Hub’s liquid Nitrogen is its flavors. The

business will divide its product line into three segments based on their flavors. The first

segment are the classic flavors which will mainly composed of the vanilla, chocolate,

cheese and ubeflavors. Another segment is the premium flavors like the Cookies and

Cream, Double Dutch and Rocky Road. And lastly, the best of the Philippines flavors

which will include “Mango Tango” of San Carlos City, “Sea Salt Caramel” of Dasol, “Maiz

con Keso” of San Jacinto, and “Pandan con Leche” of Mapandan. Also, to lessen the

effects of slack season during rainy days, the business will be offering a limited-edition

flavor such as Strawberry-Jalapeno. With these variations of flavors, the customers can

better enjoy and satisfy their taste as well. Also, it provides the customers a different way

to appreciate the Province of Pangasinan by experiencing its best products.

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G. Location Profile

Dow
ntow
n

Ice Creamistry Hub

Figure 1.4 Target Location of the business (left: aerial view; right: front view)

The proponents decided to rent for a commercial space where they will start and

operate their business. The agreed location is in Burgos Extension, Dagupan City,

Pangasinan. The commercial building, which is owned by Dr. Adanhas a land area of 40

square meters which can accommodate approximately 20 to 30customers. The said

commercial space has a monthly rental of Php15, 000. It is a good location given that it

is located along the road wherein public transportations usually pass by making it very

accessible to people who wants to try the liquid nitrogen ice cream. Moreover, it is a

strategic location since it is near to the company’s suppliers and to its target market

which comprises the families, students of different schools and universities and working

professionals with middle to high income.

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H. SWOT Analysis

STRENGTHS

 More advanced way of making ice cream

Commercial ice creams undergo a two-step process. It begins the freezing of ice

cream to a semi-solid state and then place it in a commercial freezer to fully freeze the

rest. With the used of liquid nitrogen, the process becomes simpler with its flash freezing

feature. It will not be placed in a freezer for several hours because it is able to freeze the

ice cream mix instantly. As compared to other ice cream parlors, the business will be

able to reduce inventory handling cost. It will allow the customers to choose their own

flavors and they can view the actual process of preparing their ice cream.

 Appealing Atmosphere

The ice cream parlor’s interior design is aimed to give customers a fun and

exciting environment to stay especially for those customers who wants to be relieved

from the stress in their works, studies or lives.

The establishment has designed its interior in a way that gives customers a

sense of enjoyment and relaxation. It has implemented some of the basic concepts of

interior design which includes balance, harmony and unity, proportion and scale, and

color. Balance relates to the equal distribution of visual weight in a room by balancing a

room with heavy objects or multiple light objects that are visually equal. Harmony and

unity is the showcasing of a common style and theme through the use of color schemes

to unify a collection of spaces. Proportion and scale is ratio and size of elements relative

to a room. Lastly, colors to influence emotion.Colors to be substantially used include

white, black, yellow and blue. Due to the small area of the store, white is helpful in

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creating the illusion of space. White may also give the impression that it is much higher

than it is and can give an invigorating freshness. Black gives an elegant and

sophisticated air designing the shop. It puts a light or neutral background color. Yellow is

a stimulating color that exhibits optimism, happiness and creativity

Figure 1.6 Interior Design of Ice Creamistry Hub

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 Geographic Location

The business will be placed within the parameters of Dagupan City. It is

considered as one of the most progressive citiessince it is considered as one of the

center of trade in Pangasinan. It is an ideal location because it is near the suppliers of

equipment and materials needed in the business operation. It is also near the main

target markets who are the students and employees with medium to high

income/allowance.

WEAKNESSES

 Supply Chain Management of Liquid Nitrogen

The business has only few potential suppliers of liquid nitrogen within the target

location which includes the MEGASCO and DRL Libunao in Calasiao, Pangasinan. The

business also considers those distant suppliers such as Consolidated Industrial Gases

Incorporated in Baguio City, Ingasco in Caloocan City and National Chemistry

Instrumentation Center (NCIC) in Ateneo de Manila University. Due to its limited supply,

the enterprise will create and maintain a good supplier relationship. This will be done by

avoiding rushing orders that will frustrate the suppliers, paying on time, bringing up

concerns and problems immediately to their attention and by having a direct and regular

communication with them.

 Risk of working with Liquid Nitrogen

Liquid Nitrogen which is extremely cold can rapidly freeze skin tissues, frostbite

and eye fluid if improperly handled. In order to avoid such circumstances, the maker and

preparer of liquid nitrogen ice cream will observe due care and proper precautionary

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measures like wearing gloves and making sure that the liquid nitrogen evaporated for

about 3-5 minutes before serving it to the customers.

OPPORTUNITIES

 Increasing consumption of ice cream

According to the Canadean Intelligence’s Research (2016), the ice cream market

in the Philippines has been growing for the past few years. The volume consumptions

are expected to grow from 97.1 million kilograms in 2014 to an estimated 133.7 million

kilograms in 2019 resulting to an increase of 37.60%. Also, based on the survey

conducted by the proponents 299 out of300 persons favored ice cream and majority of

them are buying ice cream once a week. The business will take advantage of this

opportunity by making further efforts in penetrating the market to establish the brand

amongst the public and in gaining customer loyalty.

 Increasing health consciousness

According to new Pulse Asia survey (2016). Filipinos were found to be health-

conscious at the end of 2015 with three out of five individuals citing staying healthy an

urgent personal concern. The company can capture great benefit from this opportunity

through building awareness in the market about its product being made from fresh

ingredients and free from preservatives and emulsifiers.

 Seasonality of Product

Ice cream is consumed all year long, with summer being its peak period. In this

season, this gives the enterprise an opportunity to sell more than in usual operations.

During this peak season, the company will be able to maximize its sales.

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THREATS

 Established Ice Cream Parlors

Since there are already established ice cream parlors like the Ice Cream House

and Shaper’s Creamery that operates in the target market, most of them already gained

customer loyalty. The business will mitigate this threat by focusing on providing

customer value and satisfaction. This can be done by introducing the Pangasinan’s Best

such as Mango Tango Ice Cream from San Carlos City, Maiz con Keso Ice Cream from

San Jacinto, and Pandan con Leche Ice Cream in Mapandan. The enterprise will also

aim to provide customers the Ice Creamistry experience. Accommodating customer

service are to be provided by personnel. The business will also provide its customers a

relaxing ambiance the customer can enjoy will eating their ice cream.

 Change in Customer Preference

As time passes by, customers tend to change preferences, change in eating

patterns and crave for new flavors. In response to this, the establishment would have to

innovate its product in a way that continuously satisfies the costumers need and wants.

Adapting to these kinds of changes is essential for the business to continue operating.

Examples of these innovations is integrating the ice cream into other forms such as the

ice cream cake and cookies or creating other healthful flavors.

 Seasonality of Product

Frozen dessert production clearly follows a seasonal pattern. Summer tends be

where demand is at its highest, while in rainy seasons there is a decline. This serves as

a threat to the establishment due to the potential decrease it has on sales. The business

will mitigate this by offering limited edition flavors like Jalapeno-Strawberry,

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complimentary products such as freshly baked pastries and pizzas and distributing

coupons.

II. INDUSTRY ANALYSIS

A. Industry overview

The Ice Creamistry Hub is to be classified in the Frozen Food Industry

particularly in the Frozen Desserts Industry. The frozen desserts industry mainly

comprises products such as regular and low-fat ice cream, frozen yogurt, frozen tofu,

and sorbets.

According to the

Canadean Intelligence’s

Research (2016), the ice cream

market in the Philippines has

been growing for the past few

years. The volume consumptions

are expected to grow from 97.1

million kilograms in 2014 to an

estimated 133.7 million kilograms


Figure 2.1 Ice Cream Consumption in the Philippines
in 2019 resulting to an increase of

37.60%. During the intervening period, the Compound Annual Growth Rate (CAGR) is

forecasted to be at 6.60%. CAGR is a geometric progression ratio that is useful in

measuring the growth of investment over multiple time periods.

In the Philippines, Selecta and Nestle are the two well-known players in the Ice

Cream Market. Selecta, which is owned by the Philippines-based RFM Corporation, was

started in year 1948 as an ice cream parlor in Manila. It was known for always being

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ahead in product innovation by creating new flavors. On the other hand, Nestle was

founded by Henri Nestle in 1867. It first created infant foods as a substitute for mothers

who could not breastfeed their babies. Over the years, its product range expanded which

includes coffee, milk, beverages, non-dairy creamer, food, infant nutrition, ice cream and

chilled dairy. In 1960, Nestle capitalized on ice cream due to the increasing number of

household buying freezers which leads to a rising demand.

Between them, Selecta is currently the most dominant ice cream brand. Nestle

was the former leading brand in the Philippines but was later outshined by Selecta after

obtaining a larger market share of 80% as of summer 2016 (Dumlao-Abadilla, 2016).

According to Jose Concepcion III, the president and CEO of RFM Corporation, their

sales boost from the combined impact of El Niño and the usual hot weather during

summer. He also emphasizes that improvements in their supply and distribution system

supported the growth momentum in sales and profits. Moreover, other commercial ice

cream includes Magnolia, Carmen’s Best and Arce Dairy.

Aside from the established ice cream companies that provide commercial ice

cream in the market, there are also small scaled ice cream parlors. At the top of the list

are Carousel Creamery, Gelatissimo and Merry Moo who are taking the Manila area by

storm as each establishment offers their customers their own unique blend of ice

creams. Carousel Creamery mainly offers crepes and waffles that go with 101 flavors of

ice cream which includes Blueberry Bingsu, Nut Cluster, Keso my Ube, and Pinipig

Crunch. Gelatissimo on the other hand, was known for its Chocolate Truffle, Burnt

Caramel & Pecan and Lychee. Lastly, Merry Moo’s best seller, Sea salt caramel, has

been appealing many customers.

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As more competition enters the market, continuous innovation of products is

essential in order for a business to continue operating indefinitely. To be set apart from

other ice cream parlors, establishments such as Kiss the Ice located at Recto Avenue,

Ice Cream Laboratory at SM City Fairview, Joseph’s Craft Ice Cream at Main Wing

Shangri-La Plaza, Iscreamist at Magiting Diliman, and the Seventh Element at Gastro

Park Pasig have integrated the Liquid Nitrogen in making and serving their ice creams.

As early as 2011, they are of the first establishments to introduce the liquid

nitrogen ice cream in the Philippines.

B. Supply

The proponents gather information on the supply and demand of ice cream

through the Internet. However, since the information about ice cream in Dagupan City is

very limited, the researchers conducted an interview with the Department of Trade and

Industry and with different people who are engaged in the ice cream business like,

sorbets manufacturer, commercial ice cream wholesaler, and Ice Cream kiosk vendors

last August 11, 2017.

Name of Business Business Description Amount of Ice Cream Supplied


(Approximated on a per month basis)

Nestor Ice Cream Manufacturer and seller of


special-flavored sorbets.
Having its operation for 28 820 kilograms
years at Guilig, Malued
District, Dagupan City.
Wholesaler and distributor
of commercial ice creams.
Gold Delight Ice 2,998 kilograms
Having its operation for 10
Cream
years at Mangin, Dagupan
City.
Commercial Ice Retailers of commercial ice 1,588 kilograms
cream kiosks cream

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5,406 kilograms
TOTAL

C. Demand

The demand was derived using the amount given by the interviewees during the

interview conducted by the proponents. According to Mr. Edwin Edstrada, owner of

Nestor Ice Cream, the amount of ice cream they supply is usually equal to the

amount consummated by the customers on a regular basis. Based on their 25 years


Table 2.1 Approximate amount of supply in the target market
of experience in selling ice cream, the unique flavors of their special sherbet are

what keeps the customers in coming back and makes their ice cream to be sold out.

In addition, Mr. Edstrada mentioned that they are also receiving special orders but

since it is not on a regular basis its amount cannot be easily quantified. He also

pointed out that they only make half of their normal production during rainy seasons

due to decrease in demand.

Name of Business Amount of Ice Cream DEMAND


(Approximated on a per month basis)

820 kilograms
Nestor Ice Cream

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Gold Delight Ice Cream 2,998 kilograms

Commercial Ice cream kiosks 1,588 kilograms

TOTAL 5,406 kilograms

On the other hand, Ms. Evelyn B. Liwag, a wholesaler and dealer of Gold Delight

Ice Cream, said that they based the amount of ice cream they supply on the orders

they received from different retailers. She also said that orders usually drop on about

fifty percent during the rainy seasons.

Based from the information gathered, the proponents conclude that there is no

significant gap between the demand and supply of ice cream in the target market.

However, since the business’ product is different from the other kinds of ice
Table 2.2 Approximate amount of demand in the target market
creams offered in the market, the proponents conducted an interview with the Seventh

Element, a liquid nitrogen ice cream parlor located at Brgy. Kapitolyo,Pasig, Metro

Manila. Based on the interview, it was noted that the approximated supply of 1,260

kilograms per month was exceeded by the approximated demand of 1,512 kilograms

per month resulting to a gap of 252 kilograms per month.

Seventh Element's Market Gap

16.67%

Quantity Supplied Total Gap

83.33%

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Figure 2.2 The gap between the supply and demand of Seventh Element's Liquid Nitrogen ice cream.

Aside from the interviews, the proponents also conducted a survey in its target market to

have additional information about the consumer’s insight in eating ice cream. Based on the

survey, 299 out of 300 people like ice cream. Further, the respondents were also asked about

the liquid nitrogen ice cream. Among the population, 96% have not yet tried the Liquid Nitrogen

Ice Cream and 87% of them want to experience the product.

D. Porter’s Five Forces Model

In this Porter’s Five Forces, Ice Creamistry Hub may experience the effects of

external factors at varying intensities. To minimize the negative impact, the business will

implement strategies to cope up with the competitive market. Ice Creamistry Hub’s five

forces analysis yields the following intensities:

1. Bargaining Power of Supplier - HIGH

The main components of making the liquid nitrogen ice cream includes

sugar, vanilla, heavy cream, fresh milk, fresh fruits and liquid nitrogen. The

ingredients’ price ranges are shown below.

ITEM COST
(As of November 2017)
Sugar P50-P100 per kilogram

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Vanilla P25-P50 per liter

Heavy Cream P150- 250 per liter

Fresh Milk P70-P100 per liter

Fresh Fruits P50-P200 per kilogram

Liquid Nitrogen P150-P250 per liter

Table 2.3 Costs of Main Ingredients

These ingredients except liquid nitrogen are available and commonly

found in grocery stores and public markets. The potential suppliers of the

business are Limpan Commercial, Malimgas Public Market and CSI

Supermarket. Since they are highly available in the local market, it makes the

bargaining power of suppliers of these inputs to be low.

However, liquid nitrogen has a few potential suppliers which comprise

Megasco in Caranglaan District, Dagupan City as its main supplier. Other

suppliers such Consolidated Industrial Gases in Baguio City, DRL Libunao in

Calasiao and Ingasco in Caloocan City will be alternatives. This causes the

bargaining power of supplier to be high.

To sum it up, the overall threat of bargaining power of suppliers is still

assessed to be high since the critical aspect of making the product lies within the

supply of Liquid Nitrogen which makes the product different from the other.

To minimize the high force of the suppliers in the business, Ice

Creamistry Hub will create and maintain good supplier relationship. This will be

done specifically by avoiding changing or rushing orders, paying on time and

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bringing out problems and concerns immediately to the suppliers’ attention.

Among all, the most important tool to build a strong relationship with the suppliers

is through communication. Communication will create transparency on both sides

and will prevent delays and mistakes in making decisions. Having the way in

dealing with them allows both parties to quickly communicate and share

documents and other information. Also, it enables both parties to work together

to achieve optimal return and avoid excessive expenses.

2. Bargaining Power of Customer -HIGH

The proponents identify the factors influencing customer’s behavior in

buying ice cream which includes price, flavors, brands and the health benefitsthat

they would get.

. Based on the conducted survey of the proponents, the factor which

most affects the customer’s buying decision with regards to an ice cream is the

flavor. This will be a good opportunity to the business since it will offer a new

variety of flavors which can satisfy the needs and wants of a customer.

To further assess the bargaining power of customer, Ice Creamistry

Hub’s Liquid Nitrogen ice cream has plenty of substitutes in the market which

mainly includes those other kinds of ice creams like the commercial ice creams

and sorbets. This abundant supply of substitutes lowers the customer’s switching

cost causing them to easily change from one product to another. Despite of this,

the number of ice cream consumers is bigger than the number of suppliers in the

target market.

The business will reduce the high customer bargaining power by building

up brand loyalty through product development. This will be done by first informing

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the target market about the existence of the business and the products it will

offer. Through advertising, the business will build awareness to consumers about

its product and what makes it different among other ice creams.

It is advantageous for the business to offer a liquid nitrogen ice cream

since it is one of a few that offers liquid nitrogen ice cream. Despite its

uniqueness, the proponents will integrate various product developments to be

able to provide better customer value and gain customer loyalty such as creating

new flavors and product innovations. Considering that Pangasinan is rich in

different agricultural products, the business offers the new flavors showcasing

the popular product inherent from the province’s different cities and

municipalities. Flavors to be offered includes “Mango Tango” featuring the sweet

carabao mangoes of San Carlos City, “Sea Salt Caramel” featuring the

municipality that lives on salt, Dasol, “Maiz con Keso” showcasing the sweet

corns of Sto. Tomas, San Jacinto and “Pandan con Leche” from the

Pangasinan’s greenest and cleanest municipality, Mapandan.

Another product development is by continuously improving the form of

the ice cream like making it an ice cream cookie sandwich and ice cream smore.

The ice cream smore can be dipped in liquid nitrogen to give customers a misty

and smoky breath.

3. Threat of new entrants - MODERATE

This is based on the factors comprising the economies of scale, brand

loyalty, product differentiation, capital requirements and payback period.

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The economies of scale are the cost advantage that arises with the

increased level of production. This can be utilized during the further operating

efficiency and expansion of the venture. Brand loyalty on the other hand is the

consumer behavior where consumers become committed to a certain brand and

make repeated purchases. Moreover, product differentiation is a marketing

process that showcases a product as more attractive by contrasting its unique

with other competing products. Further, the initial investment is the required

capital to start a business. Lastly, the payback period is the length of time

required for an investment to recover its initial outlay.

Being the first establishment to offer liquid nitrogen infused ice cream in

the province of Pangasinan, it has lowered the potential threat of new entrants

with regards to product differentiation, customer loyalty and economies of scale.

Utilizing the First Mover Advantage, the enterprise is able to establish its brand

and gain customer loyalty without much dilemma with competitors for the time

being. By gaining their loyalty, customers will continually seek for the business’

products. Having built up brand identity, the enterprise may consider expanding

its operations and thereby, placing itself in a position that better exploits the

economies of scale.

However, in terms of the initial investment and the payback period, it has

a high threat level. The venture has a relatively high estimated initial investment

of Php800,000.

In terms of the venture’s profitability, with an average payback period of

four months according to Joaquin Soriano, owner of The Seventh Element, it

increases the threat of new entrants since it is likely to attract potential rivals to

enter the market.

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Considering all factors, the overall threat of new entrants is assessed as

moderate. To lower this threat level, continuous expansion of branches, product

innovation and operating efficiency is likely the best solution. In furthering

expansion, the enterprise is increasing the leverage it has on economies of

scale, thereby decreasing average unit cost. This would allow the company to

increase its profit margin and have more allowances in fixing prices, which would

be helpful against new rivals entering the market. To lessen the impact of

customer switching cost, product innovation and integration would be engaged.

4. Threat of substitute - HIGH

There are several substitutes of liquid nitrogen ice cream in the market.

Substitute products are products from another or same industry that offers similar

benefits to the consumer like the product produced by the firms. Therefore, the

business considers the yogurt, frappe and milk shakes as its substitute since

they also give almost the same wholesome refreshment as ice cream. However,

the main substitutes of the Ice Creamistry Hub are the businesses and

establishments which also offer ice cream. These consist of commercial ice

creams like Selecta, Nestle, Magnolia, Arce Dairy and Carmen’s best and ice

cream parlors such as Ice Cream House, Shapers Creamery and BLW 14.

Given these numerous substitute, customers can simply shift their

demands to those substitutes. Further, most of these substitutes’ prices are

relatively low which creates a lower risk and cost for customers on switching

products. When it comes to quality, the business offers a higher quality of

products than those substitutes thus decreases the threat of substitutes. With

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these numerous substitutes, low switching cost and product quality, the overall

threat of substitute is high.

To minimize this threat, the company will revolve its strategy through

product differentiation and product development. By offering a unique product

featuring the best of Pangasinan and continuously improvingthe ice cream like

combining it to cookies or making it as an ice cream lollipop including the

development of other flavors, customers will not be easily swayed by substitute

products. This constant innovation will add value and benefits to customers. Also,

utilizing liquid nitrogen to freeze ice cream results to creamier, smoother, and

denser ice cream which provides higher quality compared to others. By then, it

helps the business to create brand loyalty which helps prevent switchovers to

other substitutes.

5. Competitive Rivalry between existing players

Dagupan City being the target location, the business will be competing

with numerous ice cream parlors. These include the Ice Cream House, Shapers

Creamery and BLW 14. Also, ice cream distributors and whole sellers heighten

the competition which comprises the Selecta, Nestle, Magnolia, Arce Dairy,

Carmen's Best and Nestor Ice Cream that are available in malls or cafes. Similar

with ice cream that gives indulgence and delight, the business will be facing with

indirect competition as well. These are the YohFroz and White Hat that offers

frozen yogurt, Flyers Hub and Sweet Bite that mainly provide frappe and

milkshake. Lastly, these also include Yellow Tree Cafe, Trueblends and other

cafes that chiefly deliver milkteas. Given these several competitors, the

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competitive rivalry of Ice Creamistry Hub is high. Customers can easily shift their

demands to those competitors with low cost, leading to a smaller market share.

With the high competition, buyers can go elsewhere if they are not satisfied with

the benefits they get.

In order to lessen the rivalry with those existing players, Ice Creamistry

Hub will establish a strategy that can increase its competitive advantage. This will

be done by providing the utmost satisfaction and customer value through product

development and focus. When it comes to product development, the business

will make an effort to better understand unmet customer needs and work towards

it by continuously developing products and features. The business will further

improve the form of the ice cream like making it an ice cream cookie sandwich

and ice cream lollipop that can be both dipped in liquid nitrogen to give

customers a misty and smoky breath. It will also continue to develop new flavors.

On the other hand, the business will also use the strategy of focus

wherein it selects a segment or group of segments in the industry and tailors its

strategy in serving them. This strategy is important to identify and retain those

customers who make up the large portion of the business.

E. Competitors’ Profile

The business considers two kinds of potential competitors: Direct and Indirect.

Direct competitors offer a product or service which is interchangeable with our product

and indirect competitors are the substitutes or alternatives to our product. The following

businesses are considered competitors because it can significantly affect our business in

providing a product that also satisfies customer.

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Direct Competitors: Ice Cream Products

A. Commercial Ice Cream Products

 Selecta is the leading brand ice cream

in the Philippines which is owned by

RFM Corporation. It has been started in

year 1948 as one ice parlor in Manila.

Selecta was the first to offer

Double Dutch and Very Rocky Road

flavors in an ice cream stick format. Figure 2.3 Selecta Ice cream

It has come out with multiple flavors in a pack the new 3 in 1 plus one, the first

ice cream pack offers four flavors. Selecta has new and different flavors such as

mouthwatering Sapin-Sapin, chunky Choco Dip Cookie Dough, and delectable

Buco Pie con Leche. Its prices range from P89 to P245, depending on its size

and flavors. Selecta is the Philippine’s number one ice cream brand. Its ice

cream was well known for its creaminess, authentic flavors and unique gold can

packaging. Selecta has always been ahead in product innovations by creating

new and exciting flavors like cookies and cream, chocolate almond fudge and

halo-halo. It is supported by its heart-warming media campaigns that depicts

Selecta as an ice cream that creates family bonding moments.

 Nestle is a well-known player in the ice

cream market. It was owned by Henri

Nestle which was founded in the year

1866. It classified its products from

different variety of flavors such as Nestle

Figure 2.4 Nestle Ice cream


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Temptation (Tickle Me Vanilla, Double Dutch Day Cream, Cookies and Cream),

Nestle Sorbetes (BukoPandan at Keso, and Halo-Halo at Ube Halaya), and

Nestle Drumstick. Nestle ice cream prices range from P25 to P255.

Nestle’s ice cream products delight customers with options for every

preference from all natural to low or no sugar or lactose free.

 Magnolia is a food and beverage brand owned

by San Miguel Corporation (SMC). The brand

was commercially established by SMC as an ice

cream brand in 1925. It classified its products

into differet brands such as Magnolia Classic


Figure 2.5 Magnolia Ice cream
(vanilla, chocolate, mocha, strawberry, mango and sweetcorn), Magnolia Gold

Label (Double Dutch, Rocky Road, Dulce de Leche, Cramy halo-halo, Quezo

Primero, Butter Sweetcorn, etc.), Magnolia Chocolait Ice cream and Magnolia No

Sugar Added (vanilla and raspberry). Magnolia ice cream prices range from P220

to P345.

 Arce Dairy is an ice cream manufacturing

business owned by Don Ramon Arce, Sr.

which has been established in 1935. Arce

Dairy’s ice cream has captured the hearts

of Manilenos through the decades with its

distinct taste by making ice cream the old- Figure 2.6 Arce Dairy Ice cream

fashioned way. Its ultimate best sellers are Pistachio, Blueberry Cheesecake,

Durian, Atis Delight, and Green Tea which are all available in Chef Distrito,

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located at Tapuac District, Dagupan City. Its ice cream prices range from P70 to

P408 depending on the size.

Arce Dairy has maintained a clean reputation for making quality ice

cream, proven by several awards given to them. It also scientifically proven that

its ice cream products are much healthier compared to the leading ice cream

brands. However, its products are poorly distributed, making it available to limited

stores and location. It has also very limited advertising/promotion materials

lending to unpopularity among the masses.

 Carmen’s Best is an ice cream

manufacturing business which is

owned by Paco Magsaysay, the

creator of the creamiest artisan ice

cream. Carmen’s Best ice cream has

been established on October 2009 as

dairy product. It offers several ice cream Figure 2.7 Carmen’s Best Ice cream

flavors such as Salted Caramel, Butter Pecan, Cookie Dough, Tahitian Vanilla,

and Malted Milk. Its ice cream prices range from P350 to P380 depending on the

flavors.

The secret to their ice cream’s taste is that they produce their own milk

and get only the best ingredients for their ice cream, proven by several awards

given to them.

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B. Sorbetes or commonly known as “Dirty Ice Cream”

 Nestor Ice Cream is manufacturer and

distributor of ice cream. It was owned

by Edwin. It has the best quality ice

cream, because it uses natural

ingredients such fresh fruits and

coconut milk. It offers different variety

of flavors such as, bukopandan, ube, Figure 2.8 Nestor Ice cream

vanilla, strawberry, ampalaya, malunggay etc. Nestor Ice cream only cost P20

per cup.

C. Ice cream offers by Ice cream parlors

 Shapers Creamery is an ice cream

parlor that is located at Perez Blvd.,

Dagupan City. It is the first and the only

one serving Thai-inspired ice cream

rolls in Northern Luzon. It offers variety

of flavors like, green tea matcha, Figure 2.9 Shapers Creamery Ice cream

matcha strawberry ice, and matcha&oreo ice cream. Shapers Creamery’s ice

cream costs P60 per cup.

 Ice Cream House is an ice cream shop

having its location in Tambac District,

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Figure 2.10 Ice Cream House


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Dagupan City. It offers low fat, sugar free and gluten free ice cream. In addition,

this shop also offers delectable and affordable ice creams. However, their staffs

are not accommodating. Its flavors include ube, macapuno, mango, chocolate

marble and etc. Its prices range from P15 to P250 pesos depending on the size

 Miguelito’s Fried Ice Creamis a family

business that started in Paco Manila in

2002 which was owned by Miguelitos

International Corporation. Miguelito’s Ice


Figure 2.11 Miguelito’s Fried Ice cream
Cream was developed its own profile of

formulation in soft- served ice cream. It offers different ice cream products such

as bear cone, choco dip and sundae fudge. Its products range from P30 to P45

per cup depending on its class.

 BLW 14 is an ice cream parlor that is

located in Arellano St, Dagupan City. It

offers variety of flavors such as New

York Cheesecake, Oreo Overload, Milo

Godzilla, Caramel Walnut and etc. Its

ice cream’s costs P60 per cup.


Figure 2.12 BLW 14

Indirect Competitors

 White Hat is a frozen yogurt shop which is located at MacArthur Highway, Lucao

District, Dagupan City. White Hat has three new lines of drinks, which are

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all made with fresh yogurt that are healthy and delicious. First is the Fruity

Smoothie line which includes kiwi, strawberry, banana, mango, and blueberries

flavor. Second is the Signature Blends line, which includes different flavors such

as Strawberry Cheesecake Smoothie, Banana Walnut Honey, Mango Cream

Pie, Blueberry/Grape, and Peanut Butter Banana. Lastly, the Creamy Treats line,

which consist of Cookies & Cream, Caramel Cream, Chocolate Cream, and

Almond Cream. Its prices range from P100 to P240 and P20 to P55 for additional

toppings. Also, it offers an ice cream from real fresh milks that makes it creamy

and delicious. This shop has pleasant and elegant ambiance that attracts

customers.

 YohFroz is a frozen yogurt shop and food service distributors having its location

in Tambac District, Dagupan City. It offers tasty and nutritious ice cream that

contains 98% fat free and low calories. It serves Yoh-gurt parfait with the blend of

nutritious and delightful toppings costing P175 and Yohgurt smoothies, a

healthier alternative to milkshakes that comes in Mango Banana, Peach Mango

and other fruitful blends. Its price ranges from P125 to P135.

 FOSS Coffee is located at Tapuac District, Dagupan City. It offers a high quality,

affordable and innovative mixture of coffee-based drinks and other unique

beverages. The shop also provides excellent customer service. The main flavors

include Almond Roca, Black Forest, Caramel Macchiato, Coffee Jelly, Espresso

and others. It price ranges from P50- P70.

 Sip ‘n Slice is a café located at Burgos Ext. Tapuac Dist., Dagupan. It is one of

the most visited places because of the promos offered.

 Sweetbites Café is located at Arellano Street,first floor of the Quattro building

across the University of Pangasinan.It offers monster drinks that are very sweet

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from its chocolates to fruit flavors. They also have huge bottomless iced teas in a

variety of flavors.

 Trueblends is a tea and coffee shop located at A. B Fernandez Avenue,

Dagupan City. It offers blended frappe costing from P90 to P150, yakult series

costing from P95 to P110, milk tea blends costing from P60 to P110 and green

tea series costing from P60 to P80.

 Zenteais a place in Arellano St., Dagupan City with a good ambiance. It is

suitable place to study, to relax and to get rid of stress. It offers Green Tea Iced

Teas, Personalitea, Classic Milk Teas, Tea Creations and Lites which costs P60

to P110 and additional P10 to P20 for extra add-ons.

 I love Milkteahas four branches in Dagupan, located at Arellano St., Tapuac

District, Perez St and Mayombo District. It offers Milk tea costing from P35 to

P70, Popping Yogurt Tea costing from P70 to P80, Frappes costing from P90 to

P100 and Rock Salt Cheese costing from P75 to P85.

 Antonino’s Café is located at Perez Boulevard, Dagupan City which is owned

by Christine Garcia-Libid. Their best-sellers are Macadamia Frappe, Double

Chocolate Frappe, Crème Brulee Frappe, Antonino's Milk Tea and Choco Bam

Milk Tea.

Yellow Tree is the breakthrough of Chester Tan, whose passion made him start

up his own coffee shop located at Tapuac Road, Dagupan City. Despite of the

competition, Yellow Tree was able to compete in the market. It offers Hot

Classics ranging from P60 to P110, Coffee based- Hot or Iced ranging from P80

to P125, Frappes ranging from P115 to P135, Non-coffee blends ranging from

P120 to P135 and Milk Teas ranging from P85 to P110.

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F. Suppliers’ Information

To make its products, the needed inputs will be purchased from its potential

suppliers. The business chose these suppliers because of their accessibility and

lower price compared to the other suppliers. These include the following:

 Limpan Commercial is located at A.B Fernandez

Avenue,Dagupan City and Lim Pan Trading is located

at Burgos Street, Dagupan City, Pangasinan. It was

established around 1952 by Mr. Lim Pan. The

business started as a grocery along A.B. FernandezFigure 2.13Limpan Commercial

Avenue, Dagupan City and it is now operated by George Lim and his wife Alicia

Gapuz. They saw the strong demand in school, office supplies and plastic products.

Therefore in 1991, Lim Pan expanded to Lim Pan Commercial which mainly sells

products for printing press, school and office supplies; while, Lim Pan Trading sells

bakery supplies, plastic bags and packaging materials. It is also a trusted partner of

bakeries, markets, restaurants, home bakers, schools and even government offices.

Inputs which include the disposable cups and spoons will have a price ranging from

P50 to P120 per package. The business chose LimPan trading as its supplier

because it offers lower cost and it is nearby the target location of the business.

 CSI Supermarket, Inc. is one of the largest

retailer in Northern Luzon operated by Mayor

Belen Fernandez located at Lucao District,

Dagupan City, Pangasinan. CSI has been in

Figure 2.14 CSI Supermarket

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operation for the past decade providing the best service and value to its customers.

It has 13 retail centers which offer a wide selection of food products, household

equipment, fashion, beauty, lifestyle products, shoes, hardware tools, furniture,

home accessories and etc. Supplies to be purchased are milks and sugars which

price ranges from P50 to P60 per kilo for sugar, P30 to P100 for vanilla, P250 to

P350 per liter for heavy cream and P80 to P100 per liter for fresh milk.

 The business will buy the fruits that will be

needed for the different flavors of the Ice

cream in the Malimgas Public Market

located at Galvan Street, Dagupan City. The

price ranges from P50 to P200 depending on

the fruits that will purchase. Figure 2.15Malimgas Public Market

The business will buy fruits in this market because it is more affordable

and have the same quality as to those fruits offered in the Supermarkets.

 Ice Creamistry Hub will buy its Liquid

Nitrogen and liquid Nitrogen tank in New

Dagupan Metro Gas Corporation

(Megasco), a Pangasinan based gas

supplier located at Caranglaan District,

Dagupan City. It is a private corporation


Figure 2.16 Metro Gas Corporation

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owned by the Cuna family and sells various gases such as oxygen, nitrogen,

argon, carbon dioxide and hydrogen and which has been in operation for more

than fifty years. The price of this liquid nitrogen is P750 per tank and this tank

can contain 135 lbs. per square inch liquid nitrogen. The tank that will be used to

store the liquid nitrogen has a price of P6000 which is refundable. Aside from the

main suppliers, alternative suppliers for Liquid Nitrogen include Consolidated

Industrial Gases in Baguio City, DRL Libunao in Calasiao and Ingasco in

Caloocan City. And for the other supplies, the business considers supermarkets

in the nearby cities and municipalities.

III. REVIEW OF RELATED LITERATURE

Liquid Nitrogen

Liquid nitrogen, also known as LN2, is a colorless, odorless nitrogen found in its lowest

temperature. (Brodwin, E.) It can be used for a variety of things such as a coolant for

computers, in medicine to remove unwanted skin, warts and pre-cancerous cells, and in

cryogenics. Nowadays, it is also used by food makers in preserving food and even in creating

fast-freeze ice cream.

Professor Peter Barham, from the University of Bristol's School of Physics, says liquid

nitrogen is "simply the harmless gas nitrogen, which has been cooled to such a low temperature

that it becomes a liquid". (Arya, S.) It has an extremely low boiling point of -196 Fahrenheit. Due

to its tendency to vaporize in low temperatures, the gas it emits is frigid. This makes it suitable

for freezing ice cream in an instant. A benefit in freezing ice cream faster is that it causes

smaller ice crystals to form making a smoother and silkier texture. (Greenblatt, A.)

According to Kensington, a founder of a food and fashion website, “Because it is a

different texture than any other ice cream, it feels like a new experience, like a new treat”

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(Kapoor, A.) Liquid nitrogen also gives a lower melting point allowing the ice cream to melt

slower, for the customer to savor it longer.

Despite the benefits it gives with regards to ice cream consumption, certain precautions

should still be considered. Nitrogen liquid can be dangerous. (Grossman, E.) The intense cold

from liquid could cause frostbite or cryogenic burns if it is not used, and handled, properly. It is

essential that all the liquid used in food or drink preparation has evaporated before it can be

safe for consumption. Nitrogen should not be ingested when in its liquid state. According to

Professor Barham, using liquid nitrogen in cooking is fine as long as safety measures are taken.

History of Liquid Nitrogen Ice Cream

In the 4th century B.C., the origin of ice cream can be traced to Romans making ice and

milk concoctions. It continually evolved having different recipes as it spread through China,

Europe, Italy and the French Courts. It then made its way to the United States. During 1700-

1812, famous Americans began serving it to their guests. Among them were George

Washington and Thomas Jefferson.

In 1999, a campus festival was held where Will Schroder and T.J. Paskach, two

graduate students created a flash freeze ice cream machine with the use of liquid nitrogen.

(Rohrig, B.) Having brought their machine to the fair, they eventually opened the Blue-Sky

Creamery in 2002.

Ice Cream

Commercial ice creams make use of emulsifiers and stabilizers rather than using natural

ingredients. (Thompson, V.) This can be an issue with customers that are health conscious.

Having the liquid nitrogen can turn this issue around. Due to its rapid freezing ability,

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preservatives can be avoided and instead have fresher ingredients be used in the mixture since

the will be served and made on the spot.

Air: A Necessity in Ice Cream

Ingredients of ice cream essentially include milk, cream and sugar. Another important

ingredient in this cold treat is air. Air composes thirty to fifty percent of the ice cream’s volume.

(Schroer, E.)The air added to the ice cream is called overrun. This is not to cheat customers into

purchasing less for every peso spent, but it has something to do with the ice cream’s density.

This causes the ice cream structure to be porous which allows customers to scoop it smoothly

rather than having to scoop through a high-density ice cream that may be hard as a brick. Also,

it affects how fast ice cream melts. High dense ice creams melt slower but are usually harder.

Whereas less dense ones are soft but melt faster.

Difference Between Gelato and Ice Cream

A question that often arises is “What is the difference between gelato and ice cream?”.

Other than gelato being the Italian word for ice cream, the three factors that draw the line

between the two is fat, air and serving temperature. In the ice cream mixture, more fat is used to

get in between water particles as it freezes, avoiding large ice crystals to be formed. During its

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faster churning process, more air is whipped in to create a lesser dense texture. With regards to

temperature, it stored much cooler. It may seem that these differences seem to be minor, but it

does have an impact on the taste and texture of both treats. Comparing both, some have

concluded that gelato has more flavor and a softer elastic texture than ice cream.

IV. MARKETING FEASIBILITY

A. Consumer’s Analysis

1. Target Market

A properly defined target market can greatly contribute in having an effective

marketing strategy. For Ice Creamistry Hub, Dagupan City will be its main target

marketspecifically in Burgos Extension, Tapuac.

According to the 2015 Philippine census, the population of Dagupan City is 171,

271with Tapuac having a population of 5, 033.Being a first-class city, it yielded an income of

Php 268.7 Million and 90.7 percent were spent for general public services. Further, people

in this place are fond of eating and staying at restaurants, coffee shops, and other food hubs

which is apparent by the growing number of food establishments.

The proponents segmented its target market into three which mainly comprises of

high school students aging from 12-17, college students aging 18-21 years old and

employed or working people aging 22-50 with middle to high monthly allowance or income.

The proponents consider them as their target market because people of these ages are

usually the ones who experience a lot of daily stressful activities. According to some

students, they are normally stressed out by the quizzes, examinations, portfolios, projects,

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term papers, recitations and so many other school activities. Some employees on the

otherhand said that what usually stresses them out are not only their office works but also

family matters. These people need some stress relievers to be free from all the exhausting

school/office works and activities. Further, most of these people are outgoing and

adventure seekers who always want to have fun and enjoy different things.

The business aims to serve these students and workers who are under emotional strain

or tension such as stress by providing them with a calm and relaxing environment and liquid

nitrogen ice cream which can help improve their emotional state. Based on a research by

neuroscientists at the Institute of Psychiatry in London, they have discovered that eating ice

cream affects the pleasure center of the brain and that it has an immediate effect on parts of

the brain that are activated the same way during times when people enjoy themselves.

In conducting the survey, the proponents set


Frequency of Consumption
out to achieve a sample size of 300
6%
15% respondents. The respondents were equally

divided among the three target markets. The


29% 50% following are the findings and the results of the

survey conducted by the proponents.

Daily Out of the 300 respondents, only one


Once a week
2-4 times a week respondent answered that she does not like

Figure 4.1 : Target


eating Market’s
ice cream Frequency
and of Consumption
it is because she is not
Why go to ice cream shops?
fond of sweet cold desserts. For the 2%

remaining respondents who answered yes,


25%
50% of them buy ice cream daily, while 29%
1%
buy 2-4 times a week, 25% purchase week 9% 59%

4%

Relax and Enjoy Dating


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Meet friends Business
Just for ice cream Others
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whereas 6% of the respondents buy only once a month.

Having this information helps the management in planning with regards to how many

customers will be going to the shop, how to market the product to increase their frequency

of consumption, when to purchase supplies and how much staff are needed for a certain

day and time.

Further, the respondents were also asked for their reason of going to ice cream shops.

Majority (59%) of the respondents said that they usually go to ice cream shops to relax and
Figure 4.2: Customers reason of going to ice
cream shops
enjoy, 25% of them is just for ice cream, while 9% of them is to meet friends, and the

remaining percentage is for other reasons like dating, business and others. These answers

How much are you willing to


validate the proponents’ assumption that people of
spend for an ice cream?
2%
these ages need some place to relax and enjoy.

15%
For the type of order, 54% of the respondents

prefer to have dine-in orders, while 43% chose take-


83% out and only 3% wants their orders to be delivered.

With this piece of information, the proponents decided


Php51- Php100 Php101- Php150
Php151-Php200 Php201 and above to offer bothdine-in and take-out orders to customers.

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Figure 4.3: Customers maximum willingness to pay Since Ice Creamistry Hub is an upscale
for an ice cream
ice cream shop, the respondents were also asked if how much they are willing to spend for

a cup (8 oz) of ice cream. 83% of the respondents answered Php51-Php100 while 15%

chose P101-P150 and only 2% replied Php151-Php200. With this information, the

proponents will be setting the price between Php51- PhpP100.

For the factors considered in buying ice cream, flavors ranked as the customers’ first

priority, followed by price, health benefits and brand of ice cream respectively. Moreover,

Cookies and Cream is the most favorite flavor of customers followed by Rocky Road,

Double Dutch, the classic flavors and the best of Pangasinan Flavors. So, the business will

allocate a bigger portion of these flavors in the production budget.

The respondents were also asked if they are familiar with liquid nitrogen ice cream

and if they had already tried it. Of the population, 23% are already familiar with the product

Figure 4.4: Factors considered in buying ice cream

however, only 5% of them have already experience it. This signifies that almost a quarter of

the population is aware of the product existence and it is a good thing for the business

because it already has a potential market even before making promotions about the product.

Further, 87% of the respondents want to try the Liquid Nitrogen Ice Cream. While most of

723
Health Benefits
Health Benefits
Brand 933
Brand

Flavors Flavors
534
Price
Price
700
0 200 400 600 800 1000

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the remaining 13% who does not want to try think that it is dangerous and expensive.The

business can convince this last portion of the population to buy the product by presenting

the benefits that these individuals can gain from the product and not simply focusing on the

features that the product provides. The features are what the product can do whereas

benefits are what the product or service means to the customer

Based from the customer demand obtained, the following production timetable is produced:

PRODUCTION TABLE
Total
Production FEB (Units) MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN
FLAVORS Production
MIX
2500 3750 3750 3750 2500 2500 2500 1250 1250 2500 3750 2500 32500
Vanilla 11% 275 413 413 413 275 275 275 138 138 275 413 275 3578
Classic Flavors Chocolate 15% 375 563 563 563 375 375 375 188 188 375 563 375 4878
Ube 9% 225 338 338 338 225 225 225 112 112 225 338 225 2926
Rocky Road 16% 400 600 600 600 400 400 400 200 200 400 600 400 5200
Premium FlavorsDouble Dutch 13% 325 487 487 487 325 325 325 162 162 325 487 325 4222
Cookies & Cream 18% 450 675 675 675 450 450 450 225 225 450 675 450 5850
Pandan Con Leche 7% 175 262 262 262 175 175 175 88 88 175 262 175 2274
Best Of
Mango Tango 4% 100 150 150 150 100 100 100 50 50 100 150 100 1300
Pangasinan
Maiz Kon Keso 2% 50 75 75 75 50 50 50 25 25 50 75 50 650
Flavors
Further,
Sea Saltbased
Caramel on the
5%
actual
125
count
187
made
187
by
187
the125proponents
125 125
in
62
its 62
target
125
shop
187
location,
125 1622
it
Figure 4.5: Ice Creamistry Hub’s Annual Production Time Table
is during 5:00 to 7:00 pm when huge number of people passes by. With these statistics, the

proponents estimated that a greater number of customers will be entering the shop during

these hours therefore larger production will be needed.

B. Marketing Mix (4 P’s)

1. Product

Ice cream is a mixture of milk, cream, sugar, and other ingredients that has been

commonly frozen into a soft, creamy delight through traditional processes like churning and

freezing. However, liquid Nitrogen is used nowadays by some food aficionados due to its

convenience and various benefits. Because of its fast-freezing ability, it circumvents the

pitfall of the normal freezing process thus eliminating grainy texture of the ice cream. Also, it

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gives exact taste of ingredients and flavors which is not the case with freezing it in the

traditional way. The traditional preparation adds the icy, watery taste to it. Lastly, flavors can

be custom-made with fresh ingredients on the spot thus eliminating the need for artificial

coloring or preservatives used in normally prepared ice cream. It then leads to a healthier,

creamier, and fresher ice cream.

Ice Creamistry Hub will offer ice creams that will come into different flavors

generallygrouped into three which are Classic, Premium and Best of Pangasinan Flavors.

Figure 4.6 Ice Creamistry Hub's Ice Cream Flavors


The business will still be offering classic flavors which include Chocolate, Vanilla and

Ube since it is already been around for a long time. Also, based on observation most of the

ice cream lovers still gravitate toward choosing it. On the other hand, premium flavors such

as Rocky Road, Cookies and Cream and Double Dutch will be offered also in order to

elevate the craving of those people who are tired of eating classic flavors and want some

combination of flavors. However, to differentiate the business in other ice cream shops, it will

be offering the best of Pangasinan flavors namely the Sea Salt Carmel, Mango Tango,

MaizKonKezo and Pandan Con Leche. This is inspired by the eagerness to feature and

promote the different products of the province. These flavors were chosen because they can

be perfectly matched to the ingredients of the ice cream. In addition, their seasonality is not

an issue because they are always available in the market.

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These ice creams will be made by first preparing the necessary ingredients which

includes fresh milk, condensed milk, heavy whipping cream, salt, fresh fruits, mix-ins like

nuts, cookies, chips, marshmallows and other toppings, and of course, the liquid nitrogen.

After that, the ingredients which vary according to the flavor of ice cream will be mixed in a

large stainless-steel mixing bowl. Then, the liquid nitrogen will be poured out into the ice

cream mixture while continuously stirring it. The stirring of the mixture and pouring of liquid

nitrogen is continued until a consistent creamy mixture is achieved. Finally, the ice cream

will be served using an 8 oz paper cup.

In order to keep customer coming back, the Ice Creamistry Hub will be focusing in two

aspects: product and experience. For the product, offering liquid nitrogen ice cream has an

edge over other ice creams. First, they are made and served fresh without any kind of

preservatives required to store them. It results to a rich and flavorful ice cream. Second,

because of its creamy texture since liquid nitrogen helps break the ice crystals to such small

size that it leads consistency to the entire texture of the ice cream. Lastly, the process of the

ice cream is faster than any other method of making the ice cream. Indeed, by the infusion

of liquid nitrogen in the ice cream process boost the quality of the Ice Creamistry Hub’s ice

cream. While for the experience, the business will catch the attention of the customer

through the use of liquid nitrogen itself. Nowadays, simple scooping is not cool enough

anymore. Bringing liquid nitrogen in the production process of ice cream will give a wow

factor that creates even more excitement for customers. It gives a thrilling customer

experience because of the vaporous smoke that fills the shop with a scientific and futuristic

feel as customers watch their sweet treat being prepared. It is not something that is

expected but customers will definitely love it. They will be excited on taking pictures or

videos and post them on their social media accounts.

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2. Price

Ice Creamistry Hub will use the value-based pricing strategy because the product gives

value to customers since it comes along with it the experience that the business offers.

Liquid nitrogen ice cream is different compared to the other traditional ice cream parlors

because it is infused with liquid nitrogen which makes the ice cream healthier, creamier,

smoother, and denser. This is reflected in the price of the product which makes it seem

expensive. Presently, an ice cream parlor called The Iscreamist, is selling different products

infused with liquid nitrogen. Here are some of its products, one is the Dragon's Breath

S'mores which is initially looked like regular graham crackers with wafer and marshmallow

filling but turns into a smoking frozen delight when dipped in liquid nitrogen, its selling price

is Php79 per four pieces of smore. Next is the French Macarons, it is an ordinary macaron

with a stick which is served with glasses of liquid nitrogen, and once the macarons are

dipped, it sizzles and instantly freezes, its price is Php120 per two pieces of macaron. For

the business, it will set the selling price of the liquid nitrogen ice cream at Php75 per cup for

the Classic flavors, and Php90 per cup for the Premium and best of Pangasinan flavors. The

Premium and Best of Pangasinan flavors have higher price than Classic flavors because it

gives higher value to the customers based on the survey conducted. Moreover, the

Strawberry Jalapeno flavor that will be offered during rainy season only will be set at a price

of Php100 per cup since it has the highest cost and it gives more enjoyment to customers

during this season. This pricing is based on the survey conducted which the respondents

were asked if how much they are willing to spend for a cup of ice cream and 83% of them

answered a price ranging from Php51 to Php100. Also, the selling price set by the business

will be sufficient to cover the cost of the product, other business costs and still give a

reasonable return.

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3. Place

The Ice Creamistry Hub will be

established at Burgos Extension, Tapuac

District, Dagupan City. The establishment

has considered this as an ideal location as

this is frequently passed by both private


ICE CREAMISTRY
and public vehicles coming from within the
HUB
city and nearby towns. Students from other

schools within Dagupan like EDNAS

School and University of Luzon can easily

access the ice cream shop as it is only

walking distance from their schools.

Figure 4.7 Location

Dagupan City
University of Luzon EDNAS School
National HS

Current Number
6, 000 2, 000 6, 000
of Students

The building is owned byDr. Adanhaving an area of 40square meters. The terms and

conditions include a one-monthdeposit and two months advance of P15, 000.

CONSUMER CHANNEL

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The establishment will adopt a direct distribution channel. This is an arrangement

wherein the business will be serving its product directly to final consumers.

3. Promotion

Since Liquid Nitrogen Ice cream is unknown to most locals, several promotions will be

executed by the company to inform the public about the business’ existence and the

products it offers. These promotions include the following and will be handled by the

marketing manager.

 Transit Ads Execution

Figure 4.8 Transit Ads Execution

These are used on modes of transportation such asjeepneys, which is done by placing

the advertising material on top of the public vehicles. It is highly effective as an advertising

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tool because of its exposure and mobility. This is to be done a month before the opening of

the shop and four months after.

These have an estimated cost of P72 for a 3X2X12 square foot jeepney top ad. The

business will be using 12. To assemble this, wood and wires are also needed which cost

P70 per jeepney ad. These are based on the prices offered by Sights and Sites.

ITEM COST

Jeepney Top Adswith Wood and Wire P142

Jeepney Accomodation P500

TOTAL COST P642

Lamp Post Banners

This is a material placed on lamp

posts along roads or streets. It helps raise

awareness and attract a mass of people at a

lower cost as compared to billboards. These

have an estimated cost of P180 for a 3X5X12

square foot banner. Wood and wires are also

required, which has a cost of P60. This to be

executed byengaging in the services of

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Sights and Sites, an established advertising company. This is to be done a month before

and during the opening of the shop.

Figure 4.8 Lamp Post Banners

 Social Media

Figure 4.9 Facebook Page


The social media is a quick and convenient

way of informing a mass of people with little to no cost. The business can make use of

Facebook and Instagram in establishing a connection with customers and in keeping them

updated as to new product offerings, special events and promos. The business will have its

own page that will make regular and monthly posts which the general manager will take

charge of. They can also boost the Facebook page so as to reach more users. This would

cost P80 for a post that lasts for two days. Business policy states that the management will

engage this service twice a month throughout the year. It can also use the services of

What’s Up Dagupan to promote the Ice Creamistry Hub since it is a well-known

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compendium about Dagupan. This would have the company incur an annual cost of P3000

for three posts in their page.

 Issuing Coupons

Coupons will be dispersed in areas

where people frequently pass

through such as malls and plazas.

This entices the recipient as this

gives them the initiative to make

purchases from the shop because of

discounts. This will be engaged

during slack seasons like June,


Figure 4.10 Coupons
August and October. This would only

incur about P5 inclusive of paper and the printing. A piece of paper can produce 8

coupons. The estimated cost for the whole year would be P600 for the year.

 Seasonal Flavors and Products Offered

Offering limited edition flavors such

as Strawberry-Jalapeno that gives a

sweet and spicy ice cream experience. It

will offer during rainy seasons which help

mitigate the effects of slack season as

this would help in encouraging customers

Figure 4.11 Seasonal Flavors Post


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to make purchases from the shop since there will be a flavor that is not normally offered.

The business can also offer complementary products of ice cream such as freshly baked

pastries and pizzas, which is also ideal to eat during rainy weather.

 Free Taste

The business will offer during its

first day of operations 100 free small

samples of liquid nitrogen ice cream

comprising of one scoop to the first 100

customers.

The business will also continue to

develop and find new flavors to offer to

customers. During the development stage


Figure 4.12 Free Taste

in the months of August and September, the

proposed new flavors will be given as a free sample to customers and people passing by the

shop. This aims to promote the shop and product and also gain feedback on the proposed

flavor.

V. TECHNICAL FEASIBILITY

A. Production Process

The business production will begin once the order was made by the customers. The ice

creams will be made on the spot after the customers have chosen their desired flavors. The

following steps show the process of making the ice cream:

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STEP 1: Prepare all the main ingredients to be used in the storage room for making the ice

cream base and the additional ingredients which will vary according to the flavor of the ice

cream. These ingredients include the following:

1. Main ingredients

Heavy Whipping Fresh ilk Sugar Liquid Nitrogen


Cream
=

Figure 5.1 Main Ingredients for Ice Cream

2. Other ingredients:

Vanilla Syrup Ube Syrup Chocolate

Figure 5.2 Flavorings for Classic Flavors Ice Cream

Mango Pandan Caramel Corn

Figure 5.3 Flavorings for Best of Pangasinan Flavor Ice Creams

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Toppings Salt Cheese Cashew nuts Marsh Mallow

Figure 5.4 Toppings

 The following are the corresponding measurement of each ingredients which can

make 16 servings of liquid nitrogen ice cream:

4 cups (1L) heavy whipping cream

2 cups (500 ml) fresh milk

1 1/2 cup (300 g) sugar

2 Liters liquid nitrogen

Pinch of salt

Flavorings (depending on the flavor)

STEP 2: In a large stainless-steel mixing bowl, combine the main ingredients which comprise of

the heavy whipping cream, fresh milk and sugar and the other ingredients which mainly consist

of different flavorings and fruits. Mix up the ice cream mixture until it is slightly condensed.

Figure 5.5 R.,


Mandapat, Mixing of Ingredients
Rodriguez, D., Versoza, J.E., Frialde, A.J., Melendez, H.,Sison, H.,Soriano,S.M., Talagtag, P.A 60
Image source: http://thepioneerwoman.com/food-and-friends/4-ways-to-make-whipped-cream/
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Note: Add a pinch of salt into the mixture to control its sweetness while mixing.

STEP 3:Prepare liquid nitrogen to be used. Two liters of liquid nitrogen will be enough in making

sixteen (16) servings of liquid nitrogen ice cream. Put in a container called dewars.

Figure 5.6 Preparation of Liquid Nitrogen


Sources Image: https://m.aliexpress.com/amp/item/32824734474.html ;

STEP 4: Put the ice cream mixture in the commercial ice cream mixer. Mix it again while

pouring gradually the liquid nitrogen. Keep adding small amount of liquid nitrogen until you

arrive at desired consistency.

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Figure 5.7 Pouring LN2 in the Ice cream mixture


Image source: Source:http://sweets.seriouseats.com/2012/10/making-nitrogen-ice-cream-at-whats-the-scoop-portland-oregon-
slideshow.html

STEP 5: Scoop the ice cream and put it in an eight (8) ounce cup. Add toppings or mix-ins

according to the customers’ desire. By then, the liquid nitrogen ice cream is ready to be served.

If the order is said to be take out, it should be covered up by a plastic lid.

Dine In To Go

B. Flowchart
Figure 5.8of Activities
Final Product

 Production Process

Mixture of Ice
Cream Base

Storage of
Mixture
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LEGENDS

Pre-Production Events

Production Packaging

The production process will have three stages comprising of the pre-production,

production and packaging.

The pre-production process involves making the ice cream base by mixing together

heavy whipping cream, fresh milk and sugar. The mixture will then be stored in the refrigerator

for later preparations.

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Upon the receipt of the customer’s desired flavor, additional ingredients are mixed with

the ice cream base. After making the appropriate mixture, liquid nitrogen is added to freeze the

ice cream until it reaches the desired consistency.

The frozen mixture is put in an 8-ounce cup, adding toppings at the customer’s

discretion. It is then served to the customer.

 Expenditure cycle

Purchase of Goods Ice Creamistry


Hub

Supplier/ Storage
Vendor

Receipt of Cash
Goods Disbursement

LEGENDS

Entity Recording

Events

The management will monitor inventory levels to avoid stock outs. As the inventory

approaches the reorder point, purchases will be made to its suppliers for the needed materials

and ingredients; and this starts the expenditure cycle. The General Manager communicates and

transacts with different suppliers at the lowest possible cost. Purchase orders will be used to

verify these purchases. Upon receipt of goods, the General Manager will then match the

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purchase order with the quantity and quality received. After assuring the goods received, the

Cashier who’s in charge of cash collections and disbursements will prepare the payments which

will be forwarded to the suppliers and the transaction will be recorded by the bookkeeper in the

books of the establishment.

 Revenue cycle

Serving of Goods Making of


Goods

Customer Customer Ice Creamistry


Order Hub

Sales
Collection

LEGENDS

Entity Recording

Events

The customer’s order initializes the revenue cycle. Upon receipt of the order, the cashier

will then process the customer orders. After filling the order, the cashier will have to billed the

customers and will issue a customer’s receipt. Subsequently, the sale will be recorded by the

bookkeeper in the journals and post it to the ledgers. Afterwards, the food service crew who is

responsible for making and preparing ice cream, will start making the desired ice cream flavors

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of the customers. After finishing the product, food service crew will immediately serve it to the

customer.

C. Gantt Chart

December January February March April May June July August September October November December January
Activities 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 412 3 4 1 23 4 1 23 4 12 34 1 23 4 1 2 3 4 1 2 3 4 12 3 4 1 2 3 4 1 2 3 4
Business Registration and Application
Renovation of the building
Design of shop
Purchase of Furniture and Fixtures
Purchase of Equipments
Purchase of liquid nitrogen
Purchase of Ingredients
Purchase of materials
Production
Advertising
Selling of Products
Research and development
Seasonal Gimmicks
Public Relation( Charity Events)
Preparation of monthly financial report
Preparation of annual financial statement

Table 5.1 Gantt Chart

The above table shows the schedule of different activities to be done in putting up the

business. To be a duly registered business, Ice Creamistry Hub will submit its necessary

documents for registration and application for about two months starting from December to

January. However, the renovation of the rented building will take one month beginning in the 1st

week of December. One month is enough since it is only a shop size establishment having an

area of 108 square meters. The purchase of the furniture and fixtures, equipment together with

the designing of the shop will be done from the 1st week to the 2nd week of January.

Activities that can affect the daily operation of the business will include thepurchase of

liquid nitrogen and other ingredients, materials like paper cups and spoons, and the production

of liquid nitrogen ice cream itself. The business will start its operation in the first week of

February and it will be open from 4pm to 10pm since at this time, students from schools and

universities, and employees frequently passed by in the shop.

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In order to maintain the good taste and quality of the ice cream and to avoid spoilage,

proper and organized time schedule for the purchases of the materials and ingredients is

needed. Those perishable ingredients like fresh fruits, creams and milks will be purchased twice

a week, during Mondays and Thursdays. On the other hand, those materials (e.g. paper cups

and spoons) that can be stored in a longer period of time will be purchased only twice a month,

every 1st week and 3rd week, during Mondays. Moreover, using a two large liquid nitrogen tanks,

the refilling process of the liquid nitrogen will be done approximately every 3 rd week of the

month. This refilling process is just an estimate since it may still vary depending on the actual

quantity of orders or demands every day.

The business will be conducting different promotional activities throughout the year. This

includes the use of transit ads, lamp post banners, social media, coupons and free taste. The

first year would incur much advertising cost as compared to the following periods since the

business is still unknown. There will be a free taste of the ice cream during the first opening of

the shop. Transit ads will be used during the initial five months of operations. Lamp post

banners will be used before and during the month of opening. Social media would include the

boost feature in Facebook and the services of the well-known Facebook page, What’s Up

Dagupan. The boost will be used throughout the year whereas for the What’s Up Dagupan will

be used for nine posts during the year. Coupons will be distributed during the months of June,

August and October to increase sales.

With regards to research and development, it will be done during August and September

where newly developed flavors will be given to customers as a market test and to also gain their

feedback.

Further, in order to have a good public relation, the business will also conduct charity

event like giving free ice cream to less fortunate children during Christmas day. Lastly to monitor

thetrend of the business within a year, it will provide and maintain a monthly financial records

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and summary of its operation, and produce the annual financial statement at the end of the

year.

D. Facility Layout

Figure 5.9 Ice Creamistry Hub’s Ground Floor Plan

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Figure 5.10 Shop’s Perspective and Front elevation

The proponents decided to rent a commercial space where they will start to operate

their business. The location is located at Burgos Extension, Dagupan City, Pangasinan. The

commercial building rented measures 3 meters high. It has a total land area of 40 square

meters. Its length measures 10 meters and width are 4 meters which can accommodate 20 to

30 customers.

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Figure 5.11 Ice Creamistry Hub’s service (upper-left side), production area (right side, and storage
room (lower-back of production area)

The space allotted for production and service area measures 3.7 meters by 1.9 meters.

In this area they will give their orders and payment.Afterwards, they are to move besides the

counter proceeding to production area where they are able to see how the liquid nitrogen ice

cream is made. At the side of the production area is the storage room where the basic

ingredients and materials are stored. The storage room measures 1.9 meters by 1.5 meters.For

the liquid nitrogen tank, it is located at the rear side of the production area.

Figure 5.12 Customer’s Area

The Ice Creamistry’s customer area measures 8.6 meters by 2.1 meters. In this area the

customers will be able to see how the liquid nitrogen ice creams are made and take their time in

eating the ice cream.

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E. Initial Investment

Ice Creamistry Hub’s total investment needed isPhp797,612.57which is consist of Php

257,570for machineries and equipment, P 285,892 for materials and ingredients, P11,155.60 for

business requirements and pre-operating expenses, P 212, 093. 50 for Leasehold Improvement

and Php30,901for other operating expenses. To cover this, the partners will be contributing a

total of Php800,000 which will be divided by Php106,667each for capitalist partners and

Php80,000 each for capitalist-industrial.

The following is the breakdown of the total investment required in this business:

Materials and Ingredients Table 5.2 285,892.30


Machineries and Equipment Table 5.2 257,570.00
Business Requirements and pre-
operating expenses Table 5.3 11,155.60
Leasehold Improvement Table 5.4 212,093.50
**Other operating expenses 30,901.17
TOTAL INITIAL INVESTMENT 797,612.57

Table 5.2 Machineries and Equipment Needed

DESCRIPTION QUANTITY PRICE TOTAL SOURCE

EQUIPMENT

Mixing bowls 3* P 161 P 483 CSI Warehouse

Lucao, Dagupan City


Commercial 29- Nov- 17
3* P 27, 900 P 83, 700
Mixer

Blender 2** P 6, 500 P 13, 000


CSI Warehouse

Lucao, Dagupan City

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29- Nov- 17
Ice Cream
3 P 120 P 360
Dipper

CSI Warehouse

Spatula 3 P 34 P 102 Lucao, Dagupan City

29- Nov- 17

CSI DiY Shop


Knife with
Chopping 3 P 88 P 264 Lucao, Dagupan City
board
29- Nov- 17

Refrigerator 1 P 19, 995 P 19, 995

Air CSI Warehouse


Conditioner 2 P 50,000 P 100,000 Lucao, Dagupan City

29- Nov- 17
Liquid
3
Nitrogen P 434 P 1, 302
Dewars

MEGASCO Corp.
2
Liquid Caranglaan, Dagupan
(160L P 10, 000 P 20, 000
Nitrogen tanks City
/tank)
7- Nov- 17

Personal CSI DiY Shop


Protective 2 P 180 P 360 Lucao, Dagupan City
Equipment 29- Nov- 17

Enigma Technologies
Speaker 1 P 2, 574 P 2, 574
02- March- 18

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Enigma Technologies
Laptop 1 P 15, 280 P 15, 280
02- March- 18

MATERIALS

DESCRIPTION QUANTITY PRICE TOTAL SOURCE

Five Ed Printing Press

6024 Pcs 5 P30,120 Lucao, Dagupan City

29- Nov- 17

121 packs
Plastic spoons P25/pack P3,025 Limpan Commercial
(50
Pcs/Pack) Dagupan City

121 packs 04- Dec- 17


Paper Cups
(50 P 180 P21,780
Pcs/Pack)

INGREDIENTS

Heavy
Whipping 377 Liters P 187.35/L P70,630.95
Cream
CSI Grocery Store

Fresh Milk 189 Liters P 78.45/L P14,827.05 Lucao, Dagupan City

29- Nov- 17

Sugar 113 Kgs P 43.50/Kg P4,915.5

MEGASCO Corp.
Liquid Caranglaan, Dagupan
5 tanks P24,000 P120,000
Nitrogen City
(160 L)
7- Nov- 17

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CSI Grocery Store


Lucao, Dagupan City
Salt 1 Kg P24 P24
29- Nov- 17

FRESH FRUITS AND FLAVORINGS

31 Kgs P130/kg P4,030


Mango Malimgas Public
Market
Dagupan City
Sweet Corn 15 Kgs P40/kg P600
29- Nov- 17

CSI Grocery Store


Pandan 27 bottles P55.50/ Lucao, Dagupan City
P1,498.50
(20 mL) Bottle
29- Nov- 17

Chocolate 65 bottles
P95/bottle P6,175
(750 g) Limpan Commercial
Dagupan City
04- Dec- 17
Vanilla 17 bottles
P26 P442
(375mL)

Limpan Commercial
Dagupan City
Marshmallows 1 kg P140/kg P140
04- Dec- 17

33 bottles Malimgas Public Market


Ube P55.50 P1,831.50 Dagupan City
(20 mL) 29- Nov- 17
/bottle

Cashew nuts 4 packs P87 P348


(80g)

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CSI Grocery Store


Cookies 55 packs P65.85/pack P3,621.75 Lucao, Dagupan City
29- Nov- 17

Muscovado 16 packs P82.50/pack P1,320


sugar (80g)

Note: Ingredients and Materials quantity computed above is based on the estimated production in the first two months of
operation
Table 5.3 Business Requirements and Pre-Operating Expenses

Name of Requirements Place of Application (Agency) Associated Costs

Verification and reservation of Securities and Exchange Commission


P 100
company name

SEC Registration Securities and Exchange Commission 3,030

Notarized Articles of Securities and Exchange Commission


500
Partnership

Barangay Clearance Barangay’s Office 50

Sanitary Permit Barangay’s Office 200

Health Certificate City Health 480

Barangay Business Permit City Mayor’s Office 800

Mayor’s Permit City Mayor’s Office 700

BIR Clearance Bureau of Internal Revenue 1,000

Business Tax One Stop Business Center 3,000

Real Property tax clearance One Stop Business Center 100

Electrical Fee One Stop Business Center 435.60

Building Fee One Stop Business Center 240

Signboard One Stop Business Center 270

Business Plate One Stop Business Center 250

TOTAL P 11,155.60

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Table 5.4 Leasehold Improvement


Project Name : Ice Creamistry Hub
ProjectLocation: Burgos Extension, Dagupan City
Subject : Renovation Cost
Date : 12-Dec-17
Prepared by: Engr. Manuel Marcena

Item No. Item Description Quantity Unit Unit Cost Amount

1 Wall Partitions m2 33, 082.50


33.08 1,000.00
Skimcoating on Walls &
2 m2 29,994.50
Ceilings 149.97 200.00
3 Painting Works m2 54,916.50
183.06 300.00
4 Floor Tiles m2 100.00 4,000.00
40.00
5 Ceiling Works m2 500.00 20,000.00
40.00
6 Kitchen Cabinet Lot 3,000.00
1.00 3,000.00
7 Frameless Glass Door Pc 10,000.00 10,000.00
1.00
8 Fixed Glass Window 1.00 Pc 15,000.00 15,000.00
9 T&B Door Pc 3,000.00
1.00 3,000.00
10 Storage Door Pc 3,000.00
1.00 3,000.00
11 Door lockset and Accessories Set 4,000.00
2.00 2,000.00
12 Water Closet Pc 10,000.00
1.00 10,000.00
13 Soap Dish Pc 300.00
1.00 300.00
14 Toilet Paper Holder Pc 300.00
1.00 300.00
15 Kitchen Sink Pc 2,500.00
1.00 2,500.00
16 Faucet Pc 2,000.00
2.00 1,000.00
17 Tables & Chairs 1.00 Lot 10,000.00 10,000.00

18 Ice Creamistry Shop Logo Lot 2,000.00 2,000.00


1.00
19 Lighting Fixtures Lot 5,000.00 5,000.00
1.00
TOTAL RENOVATION COST 212, 093. 50

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**Other operating expenses for the first year of operation include:

Fire extinguisher for fire safety compliance 1,850.00

Utilities Expense (Water and Electricity) 16,124.00

Garbage Fee 500.00

Advertising Expense 7427.00

Contingency Fund 5, 000.00

TOTAL Php30,901.00

F. Economies of Scale

The enterprises possess the economies of scale as

production is expected to increase annually by at least

5% to satisfy the expected increase in ice cream volume

consumption. According to the Canadean Intelligence

Research, it is expected that from 2014, volume

Figure 5.13 Economies of Scale consumption will increase from 97.1 million to 133.7 million

kilograms. The increase in output causes the total cost to be allocated to more units. Thereby,

causing a decrease in average unit cost. Both total cost and production increase annually, but

the increase of production supersedes the increase of total cost.

 Breakeven point (in units)

SP VC CM SALES MIX WCM


Vanilla 75 44 31 11% 3.45
Chocolate 75 46 29 15% 4.33
Ube 75 46 29 9% 2.57
Rocky Road 90 49 41 16% 6.52
Double Dutch 90 45 45 13% 5.85
Cookies & Cream 90 47 43 18% 7.76
Pandan Con Leche 90 51 39 7% 2.76
Mango Tango 90 59 31 4% 1.23
Maiz Kon Keso 90 48 42 2% 0.84
Sea Salt Caramel 90 48 42 5% 2.11
PHP 37.43
Fixed Cost 663836
17733.31
WCC 37.43

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VI. Management Feasibility

A. Management Team

Ice Creamistry Hub is in the form of General Partnership which is composed of eight

general partners and three hired employees. It will be operated and managed by Hazel Sison

and Heidi Melendez. These partners are capable in running the business since they have

gained theoretical knowledge in business concepts. Also, having different background in their

family businesses made them to be competent and capable in managing a business.

The General Manager position will be assigned to Ms. Hazel Sison who is responsible

for overseeing the administrative functions of the businesssince she takes part in managing

their family business which revolves around transportation services of public utility jeeps. This

serves as a training ground for her to develop leadership and communication skills as she

learns to delegate tasks to different individuals and to interact with them at the same time. She

also has small money earning engagements such as being the supplier of motor oil for their

jeepney drivers’ and also a small lending service to increase her personal income.She also has

small money earning engagements such as being the supplier of motor oil for their jeepney

drivers’ and also a small lending service to increase her personal income.However, Ms. Heidi

Melendez will be the Marketing Manager as she possesses strong analytical and project

management skills. During these years, she is frequently looked upon as good in creating,

managing and coordinating activities in various group school activities like Market Day. She has

also excellent spoken and written communication skills and ability to lead and motivate her

team, which are crucial skills and responsibilities for a good marketing manager.

Moreover, having attended trainings with Mr. Oliver Timonera, owner of Iscreamist made

the partners to acquire a practical knowledge in making the liquid nitrogen ice cream. Also, in

order to be more competent in managing the business, the partners will be attending different

trainings, seminars, and activities conducted by Department of Science and Technology

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(DOST), Department of Trade and Industry (DTI) and other organizations related to the

business.

In addition, the company will hire a cashier who is responsible in cash collections and

disbursements. It will also employ two service crews who are capable in all around service such

as preparing ice cream, dishwashing, others. They must have ability to work under pressure and

remain calm even during those rush hours. The General Manager will be in charge in

conducting trainings with these service crews to gain sufficient practical knowledge and

experience. This will be done by teaching them the proper procedures in making the liquid

nitrogen ice cream and by instructing them the proper precautionary measures like wearing

gloves and making sure that the liquid nitrogen evaporated for 3-5 minutes before serving to

customers to prevent frostbite and eye fluid.

B. Organizational Structure

General Manager
Ms. Hazel Sison

Marketing Manager Food Service Crew


Ms.Heidi Melendez Cashier (2)

Figure 6.1 Ice Creamistry Hub’s Organizational Chart

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C. Job Description and Specification

Table 5.1 Job Description and Specification

POSITION DUTIES AND COMPENSATION/BENEFIT


QUALIFICATIONS
RESPONSIBILITIES S
-Must be a partner
in the business
-Responsible for
-Must possess a overseeing all
strong leadership administrative functions
and organizational in the business
skills, have good
communication -Implement policies
skills and capable of and employee morale
Monthly salary
motivating her -Direct the tasks of its allowance of
teams
General Manager employees Php5,000.00
-Must have -Set and review (The salary allowance is
experienced and budgets and managing based on the
sufficient knowledge cost partnership agreement)
in running and
managing business -Communicates and
transacts with different
suppliers

-Oversee inventory and


facility layout

-Must be a partner - Managing all


of the business marketing for the
company and activities
-Have a knowledge
of a wide range of -Developing the
marketing marketing strategy for Monthly salary
techniques and the company in line allowance of Php
concepts -Must be with company 2,000.00
an excellent objectives
MarketingManage communicator-Be (The salary allowance is
r -Planning and based on the
able to respond well
to pressure implementing partnership agreement)
promotional campaigns
-Think creatively
-Coordinating
-Be able to work marketing campaigns
with sales activities

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within a budget

- Must be a -In charge of cash


graduate of any collections and
business-related disbursements
course
-Process customer
-Must be capable in orders and generate
using Microsoft their bills
Monthly salary of Php
Word and Excel
6,662.28 including SSS,
-Receives cash and
PhilHealth and PAG-
-Must capable of does money counting
IBIG
Cashier making source and records monetary
documents transactions
(Based on the 2018
wage rates. See
-Must be trustworthy -Remits daily cash
appendix H)
sales and collection to
the general manager

-Prepare financial
reports and payroll
every 30th of the month

-Must be at least a -Welcome customers


Vocational Diploma/ as they come into the
High school shop
graduate
-Responsible for Monthly salary
-Must have good making, preparing, and allowance of
communication skills serving the ice cream Php6,662.28 including
Food Service to the customers SSS, PhilHealth and
-Must have ability to PAG-IBIG
Crew
work under pressure -Clean all tables after
and remain calm clients have left and
even during those get such tables (Based on the 2018 wage
rush hours prepared for the next rates. See appendix H)
set of customers- In
-With pleasing
charge in buying
personality and
ingredients for ice
good moral
cream-Furnish
character
customers with helpful
information regarding
service time and
special deal offer.

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D. Shifting Schedule

Table 5.2 Schedule

Position MON TUE WED THURS FRI SAT

General
3pm-10pm Day off 3pm-10pm Day off 3pm-10pm Dayoff
Manager

Marketing
3pm- 10pm Day off Day off Day off Day off 3pm- 10pm
Manager

Cashier 3pm- 10pm 3pm- 10pm 3pm- 10pm 3pm- 10pm 3pm- 10pm 3pm- 10pm

Food Service
3pm- 10pm 3pm- 10pm 3pm- 10pm 3pm- 10pm 3pm- 10pm 3pm- 10pm
Crew 1
Food Service
3pm- 10pm 3pm- 10pm 3pm- 10pm 3pm- 10pm 3pm- 10pm 3pm- 10pm
Crew 2
Ice Creamistry Hub will start its operation every 4 pm until 10 pm. The Marketing

Manager will work every Monday and Friday, to plan and develop marketing strategies for the

company. Also,she is responsible for implementing and coordinating marketing campaigns with

the sales activities.

On the other hand, the General Manager will work every Monday, Wednesday, and

Saturday to check the conditions of its sales and review feedbacks from its customers in order

to make necessary steps in improving the quality of its products and services. He is also

responsible in checking the inventory and supply needed in the operation. However, the Food

Service Crew will set up the shop and prepare the ice cream mixture before opening. When the

shop starts to open, the service crew (1) is in charge in making and preparing the liquid nitrogen

ice cream while the service crew (2) is responsible in serving the ice cream and cleaning the

table for the next set of customers.

Every Monday and Thursday, one of the crew is in charge in buying ingredients for ice

cream such as the fruits. Each crew will be given a one day off per week.

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VII. FINANCIAL FEASIBILITY

This part of feasibility study is reviewed and evaluated by Mr. John Sidfrey F. Soriano, CPA.

JOHN SIDFREY F. SORIANO, CPA.

A. Financial Assumptions

a. Operating Assumptions

a1.) Sales

 In setting the price, the business will adopt value-based pricing.

 Since the product is made to order, the sale is equal to production.

 Using the result of the conducted survey, the following sales mix is

formulated:
SALES MIX TABLE (Units)
Total
Production FEB (Units) MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN
FLAVORS Production
MIX
2410 3614 3614 3614 2410 2410 2410 1205 1205 2410 3614 2410 31325
Vanilla 11% 265 398 398 398 265 265 265 133 133 265 398 265 3446
Classic Flavors Chocolate 15% 361 542 542 542 361 361 361 181 181 361 542 361 4699
Ube 9% 217 325 325 325 217 217 217 108 108 217 325 217 2819
Rocky Road 16% 386 578 578 578 386 386 386 193 193 386 578 386 5012
Premium FlavorsDouble Dutch 13% 313 470 470 470 313 313 313 157 157 313 470 313 4072
Cookies & Cream 18% 434 651 651 651 434 434 434 217 217 434 651 434 5639
Pandan Con Leche 7% 169 253 253 253 169 169 169 84 84 169 253 169 2193
Best Of
Mango Tango 4% 96 145 145 145 96 96 96 48 48 96 145 96 1253
Pangasinan
Maiz Kon Keso 2% 48 72 72 72 48 48 48 24 24 48 72 48 627
Flavors
Sea Salt Caramel 5% 120 181 181 181 120 120 120 60 60 120 181 120 1566

Figure 7.1Sales Mix

 It is projected that the annual sales of 31,325 will have an increasing trend

of 5% yearly. This is based on the growth of ice cream market in the

Philippines in 2018 to 2021.

 It is also anticipated that the sales will increase at a rate of 50% during

peak seasons (e.g. summer and holiday season). However, it will also

decrease with the same percentage during rainy seasons. This information

Mandapat, R., Rodriguez, D., Versoza, J.E., Frialde, A.J., Melendez, H.,Sison, H.,Soriano,S.M., Talagtag, P.A 83
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is based on the interview conducted with different ice cream shop owners

and ice cream distributors.

 The sales mix is constant; this assumption is cited so as to use the simple

break-even and target profit formulas in multi-product companies.

 The business will only accept cash payment; therefore, Trade Receivables

will not be considered.

 Coupons are to be given around public locations. It is estimated that 20%

of the recipients will redeem the 10% discount that comes along with it.

This is based on the business policy.

a2.) Production

 Liquid nitrogen and materials to be used are purchased from suppliers on

every 3rd week of the month starting February.

 It is assumed that ending inventory will be 20% of the next period sales.

 Ingredients will be purchased from suppliers on Mondays and Thursdays.

 It is assumed that purchase of raw materials will increase by 5% annually.

 All of the purchases are paid on cash basis.

 The amount of production per flavor is based on the results of the survey

conducted. This is the basis used to compute the unit cost for each flavors

of ice cream. The product cost consists of direct materials and overhead.

a3.) Expenses

Costs that have substantial uncertainty in giving the business future

benefits are not to be capitalized, rather expensed outright. In recording

the transactions, the modified cash basis is to be used.

Mandapat, R., Rodriguez, D., Versoza, J.E., Frialde, A.J., Melendez, H.,Sison, H.,Soriano,S.M., Talagtag, P.A 84
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 Research and Development

The business will continue to develop new flavors and/or products

that are complementary to ice cream. This will be done by giving free

taste to the customers in order to notify them that a new product will be

available at the shop. The enterprise will set up a fund of Php10,000. The

business has considered this a line item within the cash account.

 Marketing

Various marketing methods will be engaged by the enterprise which

includes transfer ads, lamp post banners, coupon, social media and free

taste. These will be treated as expense outright.

 Utilities Expense will increase by 3% each year in conjunction with the

increase in production. The escalation is based from the 5% increase in

production yearly. The benefit should be greater than the cost.

 Salary allowances for General and Marketing Manager is based on the

partnership agreement.

b. Investing Assumptions

b.1) Property, Plant and Equipment

The business will adopt the straight-line method in depreciating its assets andwill

not assign any salvage value to its assets. Useful life generally ranges from 5 to

15 years depending on the fixed asset. The table shows the useful lives of

different property, plant and equipment.

 The building is accounted for as a finance lease. The right of use

asset related to the building is being depreciated using straight-line

method.

 The business will set its capitalization limit at P1, 000.

Mandapat, R., Rodriguez, D., Versoza, J.E., Frialde, A.J., Melendez, H.,Sison, H.,Soriano,S.M., Talagtag, P.A 85
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c. Financing Assumptions

c.1) Long Term Liabilities

The business will be leasing a building in which it is to conduct its

operations. This lease transaction is to be accounted for as a finance lease,

which is recognized as a long-term liability since the building will be utilized by

the business for a period of 10 years.

c.2) Equity

The business’ necessary funds will be financed by the partners through

contributing their respective capitals. The partnership will be composed mainly of

capitalist and capitalist-industrial partners. There will be four capitalist partners and

four capitalist-industrial partners. The capitalist partners are to contribute assets

which will mainly comprise of the 80% of the partnership’s total initial investment.

The capitalist-industrial partners will equally share the remaining 20% of the initial

capital requirement. It is also agreed that each partner will only be allowed to have

an annual withdrawal of 10% of their beginning capital per year.

B. Financial Statements

Ice Creamistry Hub


Statement of Financial Performance
For the year ended January 31, Year 1-5
YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5
Gross Sales Note A PHP 2,654,821 PHP 2,787,562 PHP 2,926,940 PHP 2,744,006 PHP 2,881,207
less: Sales Discount Note B 1,627 1,085 1,627 1,085 1,627
Net Sales 2,653,194 2,786,477 2,925,313 2,742,921 2,879,579
Less: Cost of Goods Sold Note C 1,745,652 1,827,037 1,912,346 1,817,934 1,902,483
Gross Profit 907,542 959,440 1,012,967 924,988 977,096
Operating Expenses:
Depreciation Expense Note D 165,519 165,519 165,519 165,519 165,519
Utilities Expense Note E 96,744 99,647 102,636 105,715 108,886
Preoperating Expenses Note F 6,456
Taxes and Licenses Note F 4,700 4,700 4,700 4,700 4,700
Advertising Expense Note G 44,563 7,360 19,560 7,360 19,560
Miscellaneous Expense Note H 2,890 2,890 2,890 2,890 2,890
Operating Income 586,670 679,325 717,662 638,804 675,541
Interest Expense Note I 79,489 73,458 67,066 60,290 53,107
Income before taxes 507,181 605,866 650,596 578,514 622,434
Income tax - - 195,179 173,554 186,730
NET INCOME PHP 507,181 PHP 605,866 PHP 455,418 PHP 404,960 PHP 435,704

Figure 7.2 Statement of Financial Performance

Mandapat, R., Rodriguez, D., Versoza, J.E., Frialde, A.J., Melendez, H.,Sison, H.,Soriano,S.M., Talagtag, P.A 86
Kingfisher School of Business and Finance
Ice Creamistry Hub
Statement of Changes in Partners' Equity

For the year ended January 31, Year 1-5

Mandapat, R. Rodriguez, D. Versoza, E. Frialde, A. Melendez, H. Sison, H. Soriano, S. Talagtag, P. TOTAL


Year 1

Initial Investment PHP 106,667 PHP 106,667 PHP 106,667 PHP 106,667 PHP 80,000.00 PHP 80,000.00 PHP 106,667 PHP 106,667 PHP 800,000
Add: Share in Net Income Note J 52,898 52,898 52,898 52,898 76,898 112,898 52,898 52,898 507,181
Less: Withdrawal 10,667 10,667 10,667 10,667 8,000 8,000 10,667 10,667 80,000
Ending Capital PHP 148,898 PHP 148,898 PHP 148,898 PHP 148,898 PHP 148,898 PHP 184,898 PHP 148,898 PHP 148,898 PHP 1,227,181
Year 4 Year 3 Year 2

Beginning Capital PHP 148,898 PHP 148,898 PHP 148,898 PHP 148,898 PHP 148,898 PHP 184,898 PHP 148,898 PHP 148,898 PHP 1,227,181
Add: Share in Net Income Note J 65,233 65,233 65,233 65,233 89,233 125,233 65,233 65,233 605,866
Less: Withdrawal 14,890 14,890 14,890 14,890 14,890 18,490 14,890 14,890 122,718
Ending Capital PHP 199,241 PHP 199,241 PHP 199,241 PHP 199,241 PHP 223,241 PHP 291,641 PHP 199,241 PHP 199,241 PHP 1,710,330

Beginning Capital PHP 199,241 PHP 199,241 PHP 199,241 PHP 199,241 PHP 223,241 PHP 291,641 PHP 199,241 PHP 199,241 PHP 1,710,330
Add: Share in Net Income Note J 46,427 46,427 46,427 46,427 70,427 106,427 46,427 46,427 455,418
Less: Withdrawal 19,924 19,924 19,924 19,924 22,324 29,164 19,924 19,924 171,033
Ending Capital PHP 225,744 PHP 225,744 PHP 225,744 PHP 225,744 PHP 271,344 PHP 368,904 PHP 225,744 PHP 225,744 PHP 1,994,714

Beginning Capital PHP 225,744 PHP 225,744 PHP 225,744 PHP 225,744 PHP 271,344 PHP 368,904 PHP 225,744 PHP 225,744 PHP 1,994,714
Add: Share in Net Income Note J 40,120 40,120 40,120 40,120 64,120 100,120 40,120 40,120 404,960
Less: Withdrawal 22,574 22,574 22,574 22,574 27,134 36,890 22,574 22,574 199,471
Ending Capital PHP 243,290 PHP 243,290 PHP 243,290 PHP 243,290 PHP 308,330 PHP 432,134 PHP 243,290 PHP 243,290 PHP 2,200,203

Beginning Capital PHP 243,290 PHP 243,290 PHP 243,290 PHP 243,290 PHP 308,330 PHP 432,134 PHP 243,290 PHP 243,290 PHP 2,200,203
Year 5

Add: Share in Net Income Note J 43,963 43,963 43,963 43,963 67,963 103,963 43,963 43,963 435,704
Less: Withdrawal 24,329 24,329 24,329 24,329 30,833 43,213 24,329 24,329 220,020

Ending Capital PHP 262,924 PHP 262,924 PHP 262,924 PHP 262,924 PHP 345,460 PHP 492,883 PHP 262,924 PHP 262,924 PHP 2,415,886

Figure 7.3 Statement of Changes in Partner’s Equity

Ice Creamistry Hub


Statement of Financial Position
January 31, Year 1-5

ASSETS YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5


Cash PHP 863,240 PHP 1,426,352 PHP 1,979,466 PHP 2,378,219 PHP 2,674,029
Refundable Deposit in Liquid Nitrogen Tank 20,000 20,000 20,000 20,000 20,000
Inventory NOTE K 22,803 23,943 25,140 23,569 24,747
Property, Plant & Equipment NOTE D 1,771,686 1,771,686 1,771,686 1,771,686 1,771,686
Less: Accumulated Depreciation NOTE D 186,452 372,905 559,357 745,809 932,262
Total Assets 2,491,276 2,869,076 3,236,935 3,447,665 3,558,201

LIABILITIES & PARTNERS' EQUITY


SSS, Philhealth and PAGIBIG Payable NOTE M 39,790 40,984 42,213 43,480 44,784
Vat Payable - - - 145,310 152,575
Income Tax Payable - - 195,179 173554 186730
Current Portion of Lease Liablity NOTE I 106,542 112,934 119,710 126,893 134,506
Noncurrent Portion of Lease Liablity NOTE I 1,117,763 1,004,829 885,118 758,225 623,719
Total Liabilities 1,264,095 1,158,747 1,242,221 1,247,462 1,142,315

Mandapat, Capital 148,898 199,241 225,744 243,290 262,924


Rodriguez, Capital 148,898 199,241 225,744 243,290 262,924
Versoza, Capital 148,898 199,241 225,744 243,290 262,924
Frialde, Capital 148,898 199,241 225,744 243,290 262,924
Melendez, Capital 148,898 223,241 271,344 308,330 345,460
Sison, Capital 184,898 291,641 368,904 432,134 492,883
Soriano, Capital 148,898 199,241 225,744 243,290 262,924
Talagtag, Capital 148,898 199,241 225,744 243,290 262,924
Total Partners' Equity 1,227,181 1,710,330 1,994,714 2,200,203 2,415,886

Total Liabilities and Partners' Equity PHP 2,491,276 PHP 2,869,076 PHP 3,236,935 PHP 3,447,665 PHP 3,558,201

Figure 7.4 Statement of Financial Position

Mandapat, R., Rodriguez, D., Versoza, J.E., Frialde, A.J., Melendez, H.,Sison, H.,Soriano,S.M., Talagtag, P.A 87
Kingfisher School of Business and Finance

Ice Creamistry Hub


Statement of Cash Flows
For the Year Ended January 31, Year 1
YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5
Beginning Cash PHP - PHP 863,240 PHP 1,426,352 PHP 1,979,466 PHP 2,378,219
Operating Activities
Net Income 507,181 605,866 455,418 404,960 435,704
Depreciation Expense (Factory and Office Equipment) 186,452 186,452 186,452 186,452 186,452
Refundable deposit (20,000)
Inventory (22,803) (1,140) (1,197) 1,571 (1,178)
SSS, Philhealth and PAGIBIG Payable 39,790 1,194 1,230 1,266 1,304
Income Tax Payable - - 195,179 (21,625) 13,176
VAT Payable - - - 145,310 7,265
Net cash provided (used) by Operating Activities 690,621 792,372 837,081 717,935 642,723
Investing Activities
Cash receipts from - - - - -
Cash paid for Purchase of Machineries and Equipments 446,871 - - - -
Net Cash Used by Investing Activities (446,871) - - - -
Financing Activities
Cash receipts from Partners' Initial Investment NOTE J 800,000
Cash paid for Partners' Withdrawal NOTE J 80,000 122,718 171,033 199,471 220,020
Finance Lease Liability NOTE I 100,511 106,542 112,934 119,710 126,893
Net Cash Provided (Used) by Investing Activities 619,489 (229,260) (283,967) (319,182) (346,913)
Cash at End of the Year PHP 863,240 PHP 1,426,352 PHP 1,979,466 PHP 2,378,219 PHP 2,674,029

Figure 7.5 Statement of Cashflows

C. Notes to Financial Statement

Note A: Sales Schedule

FLAVORS Selling Price UNITS Year 1 Year 2 Year 3 Year 4 Year 5

Vanilla PHP 75.00 3446 PHP 258,434 PHP 271,356 PHP 284,923 PHP 299,170 PHP 314,128
Classic Flavors Chocolate PHP 75.00 4699 352,410 370,030 388,532 407,958 428,356
Ube PHP 75.00 2819 211,446 222,018 233,119 244,775 257,014
Rocky Road PHP 90.00 5012 451,085 473,639 497,321 522,187 548,296
Premium Flavors Double Dutch PHP 90.00 4072 366,506 384,832 404,073 424,277 445,491
Cookies & Cream PHP 90.00 5639 507,470 532,844 559,486 587,460 616,833
Pandan Con Leche PHP 90.00 2193 197,350 207,217 217,578 228,457 239,880
Best Of
Mango Tango PHP 90.00 1253 112,771 118,410 124,330 130,547 137,074
Pangasinan
Maiz Kon Keso PHP 90.00 627 56,386 59,205 62,165 65,273 68,537
Flavors
Sea Salt Caramel PHP 90.00 1566 140,964 148,012 155,413 163,183 171,343
TOTAL SALES 31325 PHP 2,654,821 PHP 2,787,562 PHP 2,926,940 PHP 3,073,287 PHP 3,226,951
Less: Output tax 3/28 329,281 345,745
Adjusted Sales PHP 2,654,821 PHP 2,787,562 PHP 2,926,940 PHP 3,402,568 PHP 3,572,696

Note B: Sales Discount Schedule


Note B : SALES DISCOUNT TABLE
YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5
Total Number of Coupons Distributed 960 640 960 640 960
20% of Distributed Coupons 20% 20% 20% 20% 20%
Number of coupons claimed 192 128 192 128 192
UNITS Selling Price
Classic Flavors 35% 67 PHP 75.00 PHP 5,040 PHP 3,360 PHP 5,040 PHP 3,360 PHP 5,040
Prem ium & Best of
Pangsaninan
Flavors 65% 125 90.00 11,232 7,488 PHP 11,232 PHP 7,488 PHP 11,232
16,272 10,848 16,272 10,848 16,272
10% Discount 10% 10% 10% 10% 10%
TOTAL SALES DISCOUNT PHP 1,627 PHP 1,085 PHP 1,627 PHP 1,085 PHP 1,627

Mandapat, R., Rodriguez, D., Versoza, J.E., Frialde, A.J., Melendez, H.,Sison, H.,Soriano,S.M., Talagtag, P.A 88
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Note C: Cost of Goods Sold Schedule

FLAVORS DM/Unit (Note N) UNITS Year 1 Year 2 Year 3 Year 4 Year 5

Vanilla PHP 43.60 3446 PHP 150,236 PHP 157,748 PHP 165,635 PHP 173,917 PHP 182,613
Classic Flavors Chocolate 46.12 4699 216,709 227,544 238,921 250,867 263,411
Ube 46.42 2819 130,871 137,414 144,285 151,499 159,074
Rocky Road 49.26 5012 246,894 259,238 272,200 285,810 300,101
Premium Flavors Double Dutch 45.00 4072 183,253 192,416 202,037 212,138 222,745
Cookies & Cream 46.89 5639 264,392 277,612 291,492 306,067 321,370
Pandan Con Leche 50.55 2193 110,845 116,387 122,206 128,317 134,732
Best Of Pangasinan Mango Tango 59.20 1253 74,178 77,887 81,782 85,871 90,164
Flavors Maiz Kon Keso 47.95 627 30,041 31,543 33,120 34,776 36,515
Sea Salt Caramel 47.73 1566 74,758 78,496 82,421 86,542 90,869
TOTAL DIRECT MATERIALS 1,482,176 1,556,285 1,634,099 1,531,968 1,608,567
Factory Equipment Depreciation (MOH) 20,933 20,933 20,933 20,933 20,933
Indirect Labor (MOH) 242,542 249,818 257,313 265,032 272,983
TOTAL COST OF GOODS SOLD PHP 1,745,652 PHP 1,827,037 PHP 1,912,346 PHP 1,817,934 PHP 1,902,483

Note D: Schedule of Depreciation Expense

EQUIPMENT UNIT PER UNIT COST TOTAL COST SALVAGE VALUE USEFUL LIFE METHOD DEPRECIATION EXPENSE

FACTORY EQUIPMENT
Refrigerator 1 PHP 19,995 PHP 19,995 0 15 Straight Line PHP 1,333
LN2 Dewars 3 434 PHP 1,302 0 5 Straight Line 260.40
Commercial mixer 3 27,900.00 PHP 83,700 0 5 Straight Line 16,740.00
Blender 2 6,500 PHP 13,000 0 5 Straight Line 2,600.00
SUBTOTAL 20,933.40
OFFICE EQUIPMENT
Laptop 1 15,280 PHP 15,280 0 10 Straight Line 1,528.00
Air Conditioner 2 50,000 PHP 100,000 0 10 Straight Line 10,000.00
Stereo Speakers 1 1,500 PHP 1,500 0 5 Straight Line 300.00
Leasehold Improvement - - 212,093.50 10 Straight Line 21,209.35
Right of Use Asset - - PHP 1,324,815.67 - 10 Straight Line 132,481.57
SUBTOTAL 165,518.92
TOTAL PHP 1,771,686 PHP 186,452

Mandapat, R., Rodriguez, D., Versoza, J.E., Frialde, A.J., Melendez, H.,Sison, H.,Soriano,S.M., Talagtag, P.A 89
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Note E: Schedule of Utilities Expense

APPLIANCES ITEMS WATT USAGE(days) Cost COST PER MONTH (26 DAYS)

Air Conditioner 2 150 26 42 2,184


Refrigerator 1 200 30 43.2 1,296
Commercial Mixer 3 150 26 16.8 1,310
LED Light 5 7 26 0.59 77
Blender 2 350 26 29.4 1,529
Laptop 1 60 26 5.04 131
Stereo Speakers 1 245 26 20.58 535
TOTAL ELECTRIC COST 7,062
WATER BILL -- -- -- -- 1000
TOTAL UTILITIES EXPENSES/MONTH 8062
x 12 months
TOTAL UTILITIES EXPENSES FOR YEAR 1 PHP 96,744
TOTAL UTILITIES EXPENSES FOR YEAR 2 77640 x 1.03 PHP 99,647
TOTAL UTILITIES EXPENSES FOR YEAR 3 79969 x 1.03 PHP 102,636
TOTAL UTILITIES EXPENSES FOR YEAR 4 82368 x 1.03 PHP 105,715
TOTAL UTILITIES EXPENSES FOR YEAR 5 84839 x 1.03 PHP 108,886

Note F: Pre-operating Expenses Table


Associated Preoperating Taxes and
Name of Requirements Place of Application (Agency) Costs Expenses Licenses
Verification and reservation of company name Securities and Exchange Commission PHP 100 PHP 100
SEC Registration Securities and Exchange Commission 3,030.00 3,030
Notarized Articles of Partnership Securities and Exchange Commission 500.00 500
Barangay Clearance Barangay’s Office 50.00 50
Health Certificate City Health 480.00 480
BIR Clearance Bureau of Internal Revenue 1,000.00 1,000
Real Property tax clearance One Stop Business Center 100.00 100
Electrical Fee One Stop Business Center 435.60 436
Building Fee One Stop Business Center 240.00 240
Signboard One Stop Business Center 270.00 270
Business Plate One Stop Business Center 250.00 250
Sanitary Permit ** Barangay’s Office 200.00 200
Barangay Business Permit ** City Mayor’s Office 800.00 800
Mayor’s Permit ** City Mayor’s Office 700.00 700
Business Tax ** One Stop Business Center 3,000.00 3,000
6,456 4,700
TOTAL 11,156
**NOTE: Recurring Expenses: 4,700.00

Mandapat, R., Rodriguez, D., Versoza, J.E., Frialde, A.J., Melendez, H.,Sison, H.,Soriano,S.M., Talagtag, P.A 90
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Note G : Advertising Expense Table

Cost
YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5
1.Transit Ads Execution
Jeepney Top Ad PHP 72
Wire and Woods 70
Jeepney Accomodation 500
Transit Ads Execution/ Jeep 642
Number of jeeps 12
Total Cost PHP 7,704 0 0 0 0
2. Lamp Post Banners
Banner PHP 180 PHP 180 PHP 180
Wood and Wire 60 60 60
240 240 240
Quantity 100 50 50
Total Cost PHP 24,000 0 12,000 0 12,000
3. Social Media
Boost (2 days) 80 80 80 80 80
Frequency 24 12 12 12 12
1920 960 960 960 960
0
What's Up Dagupan (P3000
per 3 posts) 3000 3000 3000 3000 3000
Frequency 3 2 2 2 2
9000 6000 6000 6000 6000
Total Cost PHP 10,920 PHP 6,960 PHP 6,960 PHP 6,960 PHP 6,960
4.Coupons
Paper with print (8 pcs per 1
whole) 5 5 5 5 5
Pcs of Paper 40 40 40 40 40
200 200 200 200 200
Frequency 3 2 3 2 3
Total Cost PHP 600 PHP 400 PHP 600 PHP 400 PHP 600
5. Free Taste
Average costof Ice cream 13.39
Samples 100
Total Cost PHP 1,339 0 0 0 0
TOTAL ADVERTISING EXPENSE PHP 44,563 PHP 7,360 PHP 19,560 PHP 7,360 PHP 19,560

Note H: Miscellaneous Expense

MISCELLANEOUS EXPENSE
Fire extinguisher 1850
Garbage Fee 500
Occupational Tax 540

TOTAL 2890

Mandapat, R., Rodriguez, D., Versoza, J.E., Frialde, A.J., Melendez, H.,Sison, H.,Soriano,S.M., Talagtag, P.A 91
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Note I: Interest Expense

AMORTIZATION TABLE
DATE CASH PAYMENT (A) INTEREST EXPENSE (B)
AMORTIZATION (A-B) CARRYING VALUE
BEGINNING - 6% - PHP 1,324,815.67
YEAR 1 PHP 180,000.00 PHP 79,489 PHP 100,511 1,224,305
YEAR 2 PHP 180,000.00 PHP 73,458 PHP 106,542 1,117,763
YEAR 3 PHP 180,000.00 PHP 67,066 PHP 112,934 1,004,829
YEAR 4 PHP 180,000.00 PHP 60,290 PHP 119,710 885,118
YEAR 5 PHP 180,000.00 PHP 53,107 PHP 126,893 758,225
YEAR 6 PHP 180,000.00 PHP 45,494 PHP 134,506 623,719
YEAR 7 PHP 180,000.00 PHP 37,423 PHP 142,577 481,142
YEAR 8 PHP 180,000.00 PHP 28,869 PHP 151,131 330,011
YEAR 9 PHP 180,000.00 PHP 19,801 PHP 160,199 169,811
YEAR 10 PHP 180,000.00 PHP 10,189 PHP 169,811 0

Note J: Partner’s Share in Net Income

NOTE J: PARTNERS' SHARE IN NET INCOME

Mandapat, R. Rodriguez, D. Versoza, E. Frialde, A. Melendez, H. Sison, H. Soriano, S. Talagtag, P.


Total Net Income PHP 507,181
Year 1

Less: Salary Allowances - - - - 24,000.00 60,000.00 - - 84,000.00


Balance 423,181.43
Less: Equal Division of Rem. Inc. 52,897.68 52,897.68 52,897.68 52,897.68 52,897.68 52,897.68 52,897.68 52,897.68 423,181.43
Total Share in Net Income 52,897.68 52,897.68 52,897.68 52,897.68 76,897.68 112,897.68 52,897.68 52,897.68 PHP 507,181

Total Net Income PHP 605,866.48


Year 2

Less: Salary Allowances - - - - 24,000.00 60,000.00 - - 84,000.00


Balance 521,866.48
Less: Equal Division of Rem. Inc. 65,233.31 65,233.31 65,233.31 65,233.31 65,233.31 65,233.31 65,233.31 65,233.31 521,866.48
Total Share in Net Income 65,233.31 65,233.31 65,233.31 65,233.31 89,233.31 125,233.31 65,233.31 65,233.31 PHP 605,866.48

Total Net Income PHP 650,596.48


Year 3

Less: Salary Allowances - - - - 24,000.00 60,000.00 - - 84,000.00


Balance 566,596.48
Less: Equal Division of Rem. Inc. 70,824.56 70,824.56 70,824.56 70,824.56 70,824.56 70,824.56 70,824.56 70,824.56 566,596.48
Total Share in Net Income 70,824.56 70,824.56 70,824.56 70,824.56 94,824.56 130,824.56 70,824.56 70,824.56 PHP 650,596.48

Total Net Income PHP 394,677.75


Year 4

Less: Salary Allowances - - - - 24,000.00 60,000.00 - 84,000.00


Balance 310,677.75
Less: Equal Division of Rem. Inc. 38,834.72 38,834.72 38,834.72 38,834.72 38,834.72 38,834.72 38,834.72 38,834.72 310,677.75
Total Share in Net Income 38,834.72 38,834.72 38,834.72 38,834.72 62,834.72 98,834.72 38,834.72 38,834.72 PHP 394,677.75

Total Net Income PHP 429,405.64


Year 5

Less: Salary Allowances - - - - 24,000.00 60,000.00 - - 84,000.00


Balance 345,405.64
Less: Equal Division of Rem. Inc. 43,175.71 43,175.71 43,175.71 43,175.71 43,175.71 43,175.71 43,175.71 43,175.71 345,405.64
Total Share in Net Income 43,175.71 43,175.71 43,175.71 43,175.71 67,175.71 103,175.71 43,175.71 43,175.71 PHP 429,405.64

NoteK: ENDING INVENTORY

YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6


FLAVORS DM/Unit FEB FEB FEB FEB FEB FEB
Units DM Cost Units DM Cost Units DM Cost Units DM Cost Units DM Cost Units DM Cost
Vanilla PHP 43.60 265 PHP 11,557 265 11,557 278 12,134 292 12,741 307 13,378 322 14,047
Classic Flavors Chocolate 46.12 361 16,670 361 16,670 380 17,503 398 18,379 418 19,297 439 20,262
Ube 46.42 217 10,067 217 10,067 228 10,570 239 11,099 251 11,654 264 12,236
Rocky Road 49.26 386 18,992 386 18,992 405 19,941 425 20,938 446 21,985 469 23,085
Premium Flavors Double Dutch 45.00 313 14,096 313 14,096 329 14,801 345 15,541 363 16,318 381 17,134
Cookies & Cream 46.89 434 20,338 434 20,338 455 21,355 478 22,422 502 23,544 527 24,721
Pandan Con Leche 50.55 169 8,527 169 8,527 177 8,953 186 9,400 195 9,871 205 10,364
Best Of
Mango Tango 59.20 96 5,706 96 5,706 101 5,991 106 6,291 112 6,605 117 6,936
Pangasinan
Maiz Kon Keso 47.95 48 2,311 48 2,311 51 2,426 53 2,548 56 2,675 59 2,809
Flavors
Sea Salt Caramel 47.73 120 5,751 120 5,751 127 6,038 133 6,340 139 6,657 146 6,990
TOTAL 2410 PHP 114,014 2410 PHP 114,014 2530 PHP 119,714 2657 PHP 125,700 2789 PHP 131,985 2929 PHP 138,584
20% of the next year production (ending inventory) 22803 23943 25140 23569 PHP 24,747

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Note L: Material & Ingredients purchases

YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5


Materials Used PHP 1,482,176 PHP 1,556,285 PHP 1,634,099 PHP 1,715,804 PHP 1,801,595
Ending Inventory (Note K) 22,803 23,943 25,140 26,397 27,717
(Beginning Inventory) - 22,803 23,943 25,140 26,397
Purchases PHP 1,504,979 PHP 1,557,425 PHP 1,635,297 PHP 1,717,061 PHP 1,802,914
Less: Input tax 3/28 183971 193169
Adjusted Total Purchases 1504979 1557425 1635297 1533090 1609745

Note M: Manufacturing Overhead


NOTE M: Manufacturing Overhead SCHEDULE
Service Crews (3) YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5
Total Annual Salary PHP 242,542 PHP 249,818 PHP 257,313 PHP 265,032 PHP 272,983
Total Factory Equipment Depreciation 20,933 20,933 20,933 20,933 20,933
Total Manufacturing Overhead PHP 263,475 PHP 270,752 PHP 278,246 PHP 285,966 PHP 293,917

Note N: Value Added Tax

YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5


Output Tax - - - PHP 329,281 PHP 345,745
Less: Input Tax - - - 183,971 193,169
Vat Payable - - - PHP 145,310 PHP 152,575

D. Financial Ratios and Analysis

Financial ratio analysis is the quantitative analysis of financial information. It provides

input for evaluating and measuring the business’ health. It falls into different categories

depending on the parameter being measured:

 Liquidity Ratio

QUICK RATIO
Formula Year 1 Year 2 Year 3 Year 4 Year 5
Quick Assets 883240 1446352 1999466 2398219 2694029
Current Liabilities 146,332 153,918 357,103 489,237 518,596
6.04 9.40 5.60 4.90 5.19

 Quick Ratio

With the increasing trend of quick assets and current liabilities, quick ratio has a

fluctuating trend. It indicates that the business will have excess cash in the first two

year and will be more liquid in meeting its current obligation as they fall due. However,

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since the business will be subject to income tax in third year and VAT in fourth year,

the increase in current liabilities will be greater as compare to the quick asset.

 Current Ratio

CURRENT RATIO
Formula Year 1 Year 2 Year 3 Year 4 Year 5
Current Assets 906042.3 1470294.9 2024606.0 2421787.9 2718776.4
Current Liabilities 146331.8 153918.0 357102.5 489236.7 518596.0
6.2 9.6 5.7 5.0 5.2
The business has a fluctuating trend of current ratio. It is due to the increasing

amount of current assets and current liabilities from year 1 to year 5. The increase in

year 1 to year 2 implies that the business has a lower risk in meeting its current

obligations. Therefore,it will be a good indicator for the creditors in assessing their

risk.

 Activity or efficiency ratios

INVENTORY TURNOVER
Formula Year 1 Year 2 Year 3 Year 4 Year 5
Cost of Goods Sold 1745652 1827037 1912346 1817934 1902483
Ending Inventory 22,803 23,943 25,140 23,569 24,747
76.55 76.31 76.07 77.13 76.88
 Inventory Turnover

The business has a fluctuating trend of Inventory turnover. The decline on the

first three years of operation is due to the higher increase in ending inventory as

compared to the cost of goods sold. On the other hand, the increase during the fourth

year is due to the business being subjected to VAT which increases the cost of

purchases. This ratio shows efficiency of the business in selling its inventory.

ASSET TURNOVER
Formula Year 1 Year 2 Year 3 Year 4 Year 5
Net Sales 2653194 2786477 2925313 2742921 2879579
Total Assets 2,491,276 2,869,076 3,236,935 3,447,665 3,558,201
1.06 0.97 0.90 0.80 0.81

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 Asset Turnover

The business has 1.06 asset turnover in year 1 decreasing to 0.85in year 5. It

signifies that the business is not utilizing the resources efficiently during the first

four years of operations. However, during the fifth year the decrease has stopped

indicating that the business is starting to reach operating efficiency.

 Solvency Ratio
DEBT TO ASSET RATIO
Formula Year 1 Year 2 Year 3 Year 4 Year 5
Total Liabilities 1,264,095 1,158,747 1,242,221 1,247,462 1,142,315
Total Assets 2,491,276 2,869,076 3,236,935 3,447,665 3,558,201
0.5 0.4 0.4 0.4 0.3
 Debt to Asset Ratio

The continuous decrease in Debt to Asset Ratio indicates that the business’

ability to meet its long-term liabilities increases.

 Profitability Ratios
PROFIT MARGIN
Formula Year 1 Year 2 Year 3 Year 4 Year 5
Net Income 507181 605866 455418 404960 435704
Net Sales 2653194 2786477 2925313 2742921 2879579
0.19 0.22 0.16 0.15 0.15

 Profit Margin Ratio

The business experienced a fluctuating ratio due to the establishment being

subjected to VAT and Income Tax in later years and the fluctuation of

advertising throughout the years. Theincreasing ratio means that the business is

more efficient in converting sales into actual profit each year. The decrease on

the other hand indicates the adverse effect of income tax and VAT.

RETURN ON EQUITY
Formula Year 1 Year 2 Year 3 Year 4 Year 5
Net Income 507181 605866 455418 404960 435704
Total Equity 1,227,181 1,710,330 1,994,714 2,200,203 2,415,886
0.41 0.35 0.23 0.18 0.18

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 Return on Equity

The decreasing trend indicates that the partners’ return is becoming lesser

relative to their invested capital.

RETURN ON ASSET
Formula Year 1 Year 2 Year 3 Year 4 Year 5
Net Income 507181 605866 455418 404960 435704
Total Assets 2,491,276 2,869,076 3,236,935 3,447,665 3,558,201
0.20 0.21 0.14 0.12 0.12

 Return on Asset

During the first two years of operation, the company experienced an increase on

return on asset which indicates that company performed well in making a profit

from the capital it has invested in fix assets. However, it decreased and

stabilized starting from year 3 to year 5. This decrease is due to the VAT and

income tax imposed to the business.

 Other ratios

 Net Present Value, IRR and Payback Period


NPV
Cash Inflow PV of Cash Inflows
Year 1 672,700 PHP 634,623
Year 2 771,385 686,530
Year 3 571,281 479,658
Year 4 520,823 412,541
Year 5 551,567 412,163
TOTAL PHP 2,625,515
(Total Cash Outflow) -800000
Net Present Value PHP 1,825,515

cost of capital = 6%
Cost of Capital
IRR == 6%
78.64%
IRR = 7.64%
Payback Period = 1.16

The business’ positive Net Present Value indicates that the return is greaterthan the

cost. Also, since the Internal Rate of Return is greater than the cost of capital, it is a good

investment.

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IX. APPENDICES

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APPENDIX A

LETTER TO ICE CREAM PARLOR OWNER

(Date)
___________________

(Name of owner of ice cream shops)


______________________________

(Address)
______________________________

______________________________

Sir/Madam:
We, the 4th year students of Kingfisher School of Business and Finance, are currently taking a
business research/feasibility study as part of the requirements in the Bachelor of Science in Accountancy
program. Our proposed business is about liquid nitrogen ice cream parlor which aims to provide the
market a new way of making and eating ice cream.

In this regard, we would like to conduct an interview with you or with your personnel who can give
us data/information about the quantity of ice cream your business supplies in the market and the quantity
demanded by customers on weekly basis. Further, we would want to know how and where you obtain the
supplies needed in making your ice cream.

Rest assured, the information and data provided will remain confidential and will be only used for
this study. Your insights and recommendations will help us to further improve our study.
Thank you!

Respectfully,

HEIDI F. MELENDEZ
Group Leader
Contact No: 0946-732-0510

Noted:

MAYBELLE ANN LOPEZ, MBA


Research Adviser

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APPENDIX B

LETTER TO DEPARTMENT OF TRADE AND INDUSTRY

(Date)
__________________

MR. PETER MANGABAT


Provincial Director
DTI-Pangasinan Provincial Office
Star Plaza Bldg., Arellano Street, Dagupan City

Dear Mr. Mangabat:


We, the 4th year students of Kingfisher School of Business and Finance, are currently taking a
business research/feasibility study as part of the requirements in the Bachelor of Science in Accountancy
program. Our proposed business is about liquid nitrogen ice cream parlor which aims to provide the
market a new way of making and eating ice cream.
In this regard, we would like to conduct an interview with you or with your personnel who can give
us data/information about the supply and demand of ice cream in Dagupan City and throughout the
Philippines. We also wish to have a list of businesses engaged in selling ice cream in Dagupan City.
Further, we would want to identify the suppliers of Liquid Nitrogen in the Philippines.
Rest assured, the information and data provided will remain confidential and will be only used for
this study. Your insights and recommendations will help us to further improve our study.
Thank you!

Respectfully,

HEIDI F. MELENDEZ
Group Leader
Contact No. 0946-732-0510

Noted:

MS. MAYBELLE ANN LOPEZ, MBA


Research Adviser

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APENDIX C

General Partnership

ARTICLES OF PARTNERSHIP

OF

ICE CREAMISTRY HUB

KNOWALL MEN BY THESE PRESENTS:

That we, theundersigned partners,allof legal age, residents and citizens of the

Philippines, have on this day voluntarily associated ourselves together for the purpose of

forming a limited partnership under the following terms and conditions and subject to existing

and applicable laws of the Republic of the Philippines:

AND WE HEREBY CERTIFY:

ARTICLE I. Partnership Name:That the name of this partnership shall be

used in Frozen food industry particularly in Frozen dessert industryand shall transact business

under the said company name.

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ARTICLE II. Business Purpose:That the purpose for which this partnership is formed is

to introduce the liquid nitrogen ice cream in the province.

ARTICLE III. Principal Place of Business:That the principal place of business of this

partnership shall be located at Burgos Extension, Dagupan City.

ARTICLE IV. Term of Existence:That this partnership shall have a term of 5 years from

and after the original recording of its Articles of Partnership by the Securities and Exchange

Commission.

ARTICLE V.Partners’ Circumstances:That the names, nationalities and complete residence

addresses of the partners are as follows:

Name NationalityComplete Residence AddressKind of Partner

Mandapat, Ryan M. Filipino Binmaley, Pangasinan Capitalist Partner

Rodriguez, Dominique S.Filipino Lingayen, Pangasinan Capitalist Partner

Versoza, Julius Ericson M.Filipino Dasol,Pangasinan Capitalist Partner

Frialde, April Joyce P.Filipino Mapandan, Pangasinan Capitalist Partner

Melendez, Heidi F.Filipino Mapandan,Pangasinan Capitalist-Industrial

Sison, Hazel D. Filipino Calasiao,Pangasinan Capitalist-Industrial

Soriano, SharmaineMutya S.Filipino Lingayen, PangasinanCapitalistPartner

Talagtag, Princess Abeze C.Filipino Dagupan City,Pangasinan CapitalistPartner

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ARTICLE VI.Capital Contributions:That the capital of this Partnership shall be

the amount of Eight Hundred Thousand Pesos (P800, 000),Philippine Currency, contributed in

cash by the partners, as follows:

NameAmount Contributed

Mandapat, Ryan M. P 106, 667

Rodriguez, Dominique S. 106, 667

Versoza, Julius Ericson M. 106, 667

Frialde, April Joyce P. 106, 667

Melendez, Heidi F. 80, 000

Sison, Hazel D. 80, 000

Soriano, SharmaineMutya S. 106, 667

Talagtag, Princess Abeze C. 106, 667

That no transfer of interest which will reduce the ownership of Filipino citizens to less than the

required percentage of capital as provided by existing laws shall be allowed or permitted to be

recorded in the proper books of the partnership.

ARTICLE VII. Sharing Ratios:That the profits and losses of this partnership shall be

divided and distributed equally to each partner after bonuses and salary allowances.

ARTICLE VIII. Management:That this partnership shall be under Hazel S. Sison, as General

Manager, who shall be in charge of the management of the affairs of the company. She shall

have the power to use the partnership name and in otherwise performing such acts as are

necessary and expedient in the management of the firm and to carry out its lawful purposes.

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ARTICLE IX. Undertaking to Change Name: That the partners undertake to change the name

of this partnership, as herein provided or as amended thereafter, immediately upon receipt of

notice or directive from the Securities and Exchange Commission that another corporation,

partnership or person has acquired a prior right to the use of that name or that the name has

been declared as misleading, deceptive, confusingly similar to a registered name, or contrary to

public morals, good customs or public policy.

IN WITNESS WHEREOF, we have hereunto affixed our signatures this day of ______ 2018, at

Dagupan City.

___________________ _______________

(name of partner) (name of partner)

___________________ ________________

(name of partner) (name of partner)

SUBSCRIBED AND SWORN TO before mein______________, Philippines on

______________, affiants personally appeared before me and exhibited their competent

evidence of identity indicated after their respective names, as follows:

NOTARY PUBLIC

Name TIN/ID/Passport No. Date & Place Issued

Doc. No. ______;

Page No. ______;

Book No. ______;

Series of 20 ______

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APPENDIX D

CONTRACT OF LEASE

KNOW ALL MEN BY THESE PRESENTS:

This Contract of Lease executed and entered into by and between:

_________________, Filipino, of legal age, married, with residential address at

_______________________, Philippines, hereinafter referred to as the ‘LESSOR’

And

_________________, a corporation duly formed under the laws of the Philippines and engaged

in _____________________, with authorized representative __________________, Filipino, of

legal age, single/married, with residence at _______________________________________,

hereinafter referred as the “LESSEE’

TERMS AND CONDITIONS

PREMISES- LESSOR hereby leases to LESSEE and LESSEE hereby leases from LESSOR

approximately _____________ (__) square meters more or less of total land area, as is

improvement, Door ___, situated in __________________________ which shall be referred to

as the “Premises”.

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USE OF THE PREMISES- The Lease is for the purpose of operating a commercial or retail

business which the corporation is engaged in. The LESSEE, at his own expense may put up

improvements upon prior consultation and written approval of the LESSOR within the premises

hereby leased for the purpose of storage, retail, wholesale and commercial in nature and not for

any purpose whatsoever. It is being expressly agreed that if, at any time during the existence of

this lease and without the previous written consent of the LESSOR, the said premises are used

for the purposes other than what is stated, the LESSOR has the option of either terminating the

lease or collecting increased rental as deemed appropriate from the date of diversion of use of

the premises or to compel the LESSEE to stop the unapproved activity.

TERM OF THE LEASE- The term of this Lease Contract is for a period of _________ (___)

years, renewable for an unspecified duration at terms mutually agreeable to both parties,

commencing on _____________________ and ending at midnight of

_____________________, In case of pre-termination by the lessee, for any reason whatsoever,

the LESSOR has the right to collect any remaining rentals corresponding to the unexpired

portion of the LEASE period, or until such time a new LESSEE comes.

This LEASE shall not be deemed extended or renewed beyond the period time above-

mentioned for any cause or reason whatsoever and unless the parties agree in writing to extend

or renew or enter into a new Contract to Lease upon such terms and conditions acceptable to

them, the possession of the Premises by the LESSEE or any persons claiming rights through

the LESSEE, after the expiration of the term thereof, shall be illegal.

Any renewal or extension of this Contract must be expressly agreed upon by the

LESSOR and LESSEE in writing and under no circumstances can such renewal or extension be

considered as having made impliedly.

For this purpose, the LESSEE shall notify the LESSOR to the latter’s office in writing, of

this intent to renew or extend the Contract at least sixty (60) calendar days prior to the

expiration of the Leased period, or any extension or renewal thereof, provided, however, that

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the notice as aforesaid does not in any way vest unto the LESSEE the right to demand for such

extension or renewal of the Lease Period or any renewal or extension thereof.

RENT- The monthly rental shall be scheduled as follows, inclusive of the twelve percent (12%)

Expanded Value Added Tax (EVAT) adjustable corresponding to the subsequent and

substantial tax policy changes by the local or national government, with an escalation of five (5)

percent after two (2) years as illustrated below. All payments must be made only through

cash/check. Without necessity of demand, the LESSEE shall pay the monthly rental within the

first five (5) days of each calendar month, at the office of the LESSOR.

SCHEDULE OF RENTAL RATES

_____________________ Php. / Month

_____________________ Php. / Month

_____________________ Php. / Month

_____________________ Php. / Month

a) PENALTIES- Payment made after the said date shall be subject to a penalty charge of 5%

per month.

b) WITHOLDING TAX- The LESSEE shall furnish the LESSOR with the original and two

copies of its certificate of creditable income tax withheld at source BIR Form 2307, not later than

5 days after the end of each month. Failure to submit the documents shall authorize the

LESSOR to automatically add amount to the billing.

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c) BOUNCING CHECKS- Issuance of checks with no sufficient funds for three (3) instances

shall compel the LESSEE as having pre terminated the contract and as such the security

deposit shall be considered forfeited in favor of the LESSOR.

d) NON-PAYMENTS OF RENTS- Failure of the LESSEE to pay the rentals herein agreed

upon for two (2) consecutive months shall be ground for termination of this Contract of Lease

and upon which the LESSEE obligates itself to vacate and clear the premises in such

tenantable conditions without need of notice from LESSOR.

SECURITY DEPOSIT and ADVANCE- upon signing of the Contract of Lease, the LESSEE

shall make a Three (3) months deposit and Three (3) month advance rental in the total amount

of _____________________________ (Php ____________.00) Philippine Currency for the full

and faithful performance of each and every term, provision, covenant, and condition of this

lease, except that said deposit shall not constitute or substitute payment of any rent.

The deposit, which is non-interest bearing, shall remain intact during the entire term of this lease

and shall not be applied as payment for any monetary obligations of the LESSEE under this

contract, and shall be refunded to the LESSEE upon completion of the lease.

a) The amount deposited shall answer for any unpaid accounts of the LESSEE at the

expiration of the contract as well as for any damages which the LESSOR or any of its

employees, agents or guests might suffer by reason of the wrongful acts or actuation,

negligence, and or malfeasance of the LESSEE. It shall not be applied to pay for the last

months of occupancy of the premises.

b) Any unappropriated amount of such deposit shall be refundable to the LESSEE within

sixty (60) days from the termination of the contract.

c) In the event that the LESSEE terminates its contract before its term expires, the deposit

shall be deemed forfeited and refundable, regardless of the reason for its pre-termination and

whether a sixty-day notice was given or not.

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d) The LESSEE shall pay an advance payment equivalent and applicable to the twelve

(12) months with post dated check dated every _____th of the month of the lease starting

_____________________ or ______ days after signing of contract. The one (1) month advance

rental is applicable on the 12th month of the year of contract. Subsequent post-dated check

payments shall be collected by the LESSOR on an annual basis on the first month of the next

subsequent year.

SUBLEASE AND OR TRANSFER OF RIGHTS- The LESSEE shall not directly or indirectly

assign, sublease, sell, transfer, convey, mortgage, demolish or in any manner dispose of or

encumber its right under the contract in whole or in part or any interest thereto be conferred on

anyone.

RIGHT TO INSPECT LEASED PREMISES- The LESSOR or its authorized agent shall, by

previous notice to the LESSEE, have the right to enter the leased premises at any reasonable

hour of the day to examine the leased premises.

CARE OF THE LEASED PREMISES- The LESSEE shall examine the Leased Premises before

taking possession thereof, and LESSEE’s entry into possession shall constitute conclusive

evidence or admission by the LESSEE that as of the date thereof, the said Premises were in

good order and satisfactory tenantable condition. The LESSEE hereby binds itself to keep and

maintain the same in such condition as a prudent person shall do under the circumstances,

ordinary wear and tear expected. The LESSEE shall at its own expense, improve and maintain

the Leased Premises clean and free from rubbish and dirt at all times, store all trash and

garbage in proper containers and not burn any trash and garbage in or about the Leased

Premises or anywhere within the Premises.

SECURITY & SANITATION- The LESSOR shall ensure the security of the premises and

provide a security guard for the whole commercial establishment where the leased premises are

located. The LESSOR must also ensure regular collection of garbage through the barangay

garbage collector or any private entity which shall be to the account of LESSOR. The LESSOR

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also agrees to make the septic tank of the leased premises bigger in order to accommodate

more waste volume in anticipation of more customers using the toilet.

INSURANCE TAKEN BY THE LESSEE- The LESSEE shall be required to insure at his own

account any LESSOR approved permanent structure or structures constructed within the

premises with the LESSOR as co-benefactor against fire or total loss of property. The LESSEE

although not required, is also allowed and authorized to insure its own property taken inside the

leased premises, provided that the LESSOR shall be notified in advance of any and all kinds of

insurance over the property therein.

BUSINESS PERMITS, TAXES, AND COMPLIANCE AND GOVERNMENT REGULATIONS-

The LESSEE shall be responsible for securing all the necessary governments permits and

licenses for the operation of its business and all costs thereof shall be its sole account. Copies

of the said permits and licenses or any renewal date thereof shall be furnished to the LESSOR

not later than fifteen (15) days from the start of the LESSEE’s business and every renewal date

thereof as required by law.

INTRODUCTION OF PERMANENT IMPROVEMENTS- No permanent or fixed improvements

shall be introduced by the LESSEE on the leased premises unless with prior written consent

and approval of the LESSOR. Any such permanent structures, if approved and allowed, shall be

upon the option of the LESSOR registered under the co-ownership of both LESSEE and

LESSOR. Furthermore, the LESSEE shall bear the full cost of the annual real estate taxes of

such structures until expiry of lease contract and full cost of transfer of ownership to LESSOR

upon termination of contract;

UTILITIES AND SERVICES- The LESSEE shall be responsible for the installation and

maintenance costs of its own electric current, telephone, water, security and other utility

services in the Leased Premises for the duration of the lease. The LESSEE shall also clear all

accounts with all concerned utility companies upon pre-termination or expiration of contract.

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REVISION OF LEASE CONTRACT- Both parties may revise this lease contract after six (6)

months to one (1) year in the event that LESSEE assigns the business with a newly-registered

business name.

LESSOR: LESSEE:

_________________ ___________________

Signed in the presence of:

___________________ _____________________

ACKNOWLEDGEMENT

BEFORE ME, a Notary Public for and in the Cities and Province of _______________ this

_______________ at ______________________ personally appeared.

Name ID/Comm. Tax Cert. No. Date & Place

_________________ _________________ ______________

__________________ _________________ _______________

Known to me and to me known to be the same persons who executed the foregoing Contract of

Lease consisting of __ pages including this page of the acknowledgement and they

acknowledge to me that the same is their free and voluntary act and deed.

WITNESS MY HAND AND NOTARIAL SEAL on the date and in the place first above written.

Doc No. _____;

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Page No. _____;

Book No. _____;

Series of _____.

APPENDIX E

Pag-ibig Contribution Table

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APPENDIX F

SSS Contribution Table

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APPENDIX G

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Philhealth Premium Contribution Table

APPENDIX H

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CURRENT DAILY MINIMUM WAGE RATES

APPENDIX I

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SURVEY FORM

GENDER:Female Male

OCCUPATION:
 Student Unemployed
Employed/Working Retired

DAILY INCOME/ALLOWANCE:
 P50-P150 P251-350
 P151- P250 P351 above

1. Do you like ice cream?


__Yes
__No

2. How often do you buy ice cream?


__Daily
__Once a week
__2-4 times a week
__Once a month

3. How much are you willing to pay the maximum amount for a cup of ice cream?
 Php20 – Php50
 Php51 – Php100
 Php101 – Php150
 Php151 and above

4. What factors do you consider in buying ice cream ?


(pls. rank with 1 being the first priority and 5 being the least priority)
__Price
__Flavors
__Brand
__Uniqueness
__Quality and taste

5. What is your favorite ice cream flavor? (Please rank from 1-3 with 1- being the highest and 3- being the
lowest)
__Classic Flavors (e.g. Vanilla/Ube/Chocolate/Keso)
__Premium Flavors (e.g. Cookies and Cream/Rocky Road/Double Dutch)
__Best of Pangasinan Flavors (e.g. Pandan Con Leche/Sea Salt Caramel/Mango Tango/Maizkonkeso)

6. How would you like your ice cream to be?


 plain ice cream
 with toppings
 with fudge/syrup

7. What order type do you prefer?


 Dine-in

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 Take-out
 Delivery

8. What factors could make you become a loyal customer of an ice cream shop? (Please rank, with 1- being
the highest and 7- being the lowest)
__Comfortable environment
__Ice cream taste
__Good service
__Price
__Distance
__Free WiFi
__With Parking Area

9. You go to ice cream shops for :


 Relax and Enjoy
 Dating
 Meet Friends
 Business
 Just for ice cream
 Others

10. Are you familiar with Liquid Nitrogen ice cream?

 Yes
(If yes, how did you know it? ______ )

 No

11. Have you already experience ice cream infused with Liquid Nitrogen?
 Yes
(If yes, Where? ___________________________)
 Not yet
If not yet, why?
o Availability
o Pricing
o Not familiar at all
o Others, please specify__________________

12. Do you want to try the Liquid Nitrogen ice cream?


 Yes

 No
If no, what are the possible reasons?
o I think it’s dangerous to try
o It’s quite expensive
o Distance
o Others, please specify______________________

APPENDIX J

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TABULATION

TOTAL

Age
12-18 yrs. Old 118
19-25 yrs. Old 107
26-35 yrs. Old 49
36-50 yrs. Old 21
51 and above 5

Occupation
Student 200
Unemployed 0
Employed/Working 99
Retired 1

Monthly Income/Allowance
1500-4500 183
4501-7500 26
7501-10500 33
10501-20000 40
20001-30000 13
30000 and above 5

Questions

1. Do you like ice cream?


Yes 299
No 1

2. How often do you buy ice cream?


Daily 19
Once a week 150
2-4 times a week 85
Once a month 45

3. How much are you willing to pay the maximum amount of a cup (8 oz.) ice cream?
Php51- Php100 248
Php101- Php150 45
Php151-Php200 5
Php201 and above
1

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4. What factors do you consider in buying ice cream?


Price 700
Flavors 534
Brand 933
Health Benefits 723

5. What is your favorite ice cream flavor?

Classic Flavors
Vanilla 1554 6
Ube 1572 5
Chocolate 1015 8

Premium Flavors
Cookies and Cream 943 10
Rocky Road 1167 9
Double Dutch 1255 7

Best of Pangasinan Flavors


Pandan Con Leche 2108 4
Sea Salt Caramel 2165 3
Mango Tango 2186 2
Maizkokezo 2521 1

6. How would you like your ice cream to be?


plain ice cream 46
with toppings 127
with fudge/syrup 126

7. What order type do you prefer


Dine- in 164
Take-out 127
Delivery 10

8. What factors could you make you become a loyal customer of an ice cream shop?
Comfortable environment 910 5
Ice cream taste 665 7
Good Service 824 6
Price 1048 4
Distance 1481 3
Free Wifi 1468 2
With Parking Area 1846 1

9. You usually go to ice cream for?


Relax and Enjoy 178
Dating 13

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Meet friends 27
Business 3
Just for ice cream 74
Others 5

10. Are you faamiliar with Liquid Nitrogen Ice Cream


Yes 70
No 229

11. Have you already experience ice cream infused with liquid nitrogen?
Yes 13

Not yet 286


Availability 102
Pricing 8
Not familiar at all 171
Others, please specify 5

12. Do you want to try the Liquid Nitrogen ice cream?


Yes 260

No 39
I think it's dangerous to try 18

It's quite expensive 13


Distance 1
Others, please 7

APPENDIX K

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PIE GRAPH

Occupation Age
0% Student 12-18
2%
yrs.
7% old
Unemploye 19-25
33% d 16% 39% yrs.
old
Employed/ 26-35
67% Working
36% yrs.
0% old
Retired

Monthly 1. Do you like ice


Income/Allowance cream?
1500-4500
0
0%
4501-7500 Yes
13% 2% 0%
0% 7501-10500 0% No

1 4% 10501-20000 0%
61%
9% 20001-30000
100%

3. How much are you


2. How often do you willing to pay the
buy ice cream? maximum amount of a
Daily
cup2 (8 0%
oz.) ice cream?
Php51-
0% Php100
15% Once a 0%
0%
7% week 0%
15%
Php101-
0% 0% Php150
50% 2-4
28%
times 83%
Php151-
a week
Php200

5. What is your favorite


ice cream flavor? Availabili
Vanilla ty
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2%
0%
4% 2% Chocolate Pricing
5%
Cookies and Cream 0%
Kingfisher School of Business and Finance

7. What order type do 9. You usually go to ice


you prefer cream for?

Dine- in Relax and Enjoy


3 2%
Take-out Dating
0%
0% 25%
0% Meet friends
Delivery
43% 0% 1% 59% Business
54% 9%
4%
Just for ice
cream
Others

8. What factors could you make you become a


loyal customer of an ice cream shop?

Comfortable environment
Ice cream taste
7%4% 18% Good Service
11%
Price
14% 25% Distance
21% Free Wifi
With Parking Area

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12. Do you want to try


the Liquid Nitrogen ice
cream?

0%
0%
13% Yes No

87%
I think it's
dangerous to try
0%
18% 0%
11. Have you already 3% It's quite
45% expensive
experience ice cream 0%
infused with liquid 34%
Distance

nitrogen?…
0%
0%

Others, please
0% 0% Yes
4%
Not yet

96%

10. Are you familiar with liquid nitrogen ice


cream?
0%
0%

0% 0%

Yes No
23%

77%

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APPENDIX L

Total of persons and vehicles in the Location

December 18-22, 2017

Person (Daily)
Monday Tuesday Wednesday Thursday Friday Saturday Weekly Total Monthly Total
4:00-5:00 537 589 560 602 524 427 3239 12956
5:00-6:00 844 797 887 698 579 714 4519 18076
6:00-7:00 800 743 712 759 624 722 4360 17440
7:00-8:00 493 559 539 521 463 420 2995 11980
8:00-9:00 397 409 411 380 364 212 2173 8692
9:00-10:00 213 249 182 173 183 164 1164 4656
3284 3346 3291 3133 2737 2659 18450 73800

Vehicles (Private and Public)


Monday Tuesday Wednesday Thursday Friday Saturday Weekly Total Monthly Total
4:00-5:00 1,084 1,403 1,444 1,774 1,319 1,144 8168 32672
5:00-6:00 1,401 1,735 2,039 1,970 1,606 1,445 10196 40784
6:00-7:00 1,776 1,927 1,733 1,497 1,387 1,528 9848 39392
7:00-8:00 1,088 758 1,819 676 1,086 830 6257 25028
8:00-9:00 735 636 700 572 528 566 3737 14948
9:00-10:00 423 391 538 398 404 326 2480 9920
6,507 6,850 8,273 6,887 6,330 5,839 40686 162744

236544

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APPENDIX M

Business Permit

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APPENDIX N

LIST OF ICE CREAM PARLORS IN DAGUPAN CITY

Trade Name Location Owner

Nerissa Ice Cream House Tambac District, Dagupan Ms. Nerrisa Sarmiento Capito
City

Charay Ice Cream Station Pantal, Dagupan City Ms. JanetttTaneo Cruz

Sikat Ice Cream Manufacturing Herrero, Dagupan City Mr. Romulo PanganibanPanopio

Nestor Ice Cream Malued District, Dagupan City Mr. Edwin Estrada Cusi

Mary’s Ice Cream Pantal, Dagupan City Ms. Mary Angeline Castro
Fernandez

Ice Cream House PoblacionOeste, Dagupan Mr. Cloyd Peter Petenio Lalas
City

Shanel Ice Cream Pantal, Dagupan City Ms. Sheila Marie AbarabarOrbon

Sikat Ice Cream Manufacturing Pantal, Dagupan City Mr. Albert Anthony TolentinoOrbon

Source: Department of Trade and Industry (DTI)

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APPENDIX O

DOCUMENTATION PICTURE OF ICE CREAMISTRY HUB’S LOGO

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