POLYTECHNIC UNIVERSITY OF THE PHILIPPINES

Biñan Campus

A Feasibility Study on

Establishing Power Generating Bicycle

In partial fulfilment of the Course Requirement Project Feasibility Study

In the degree Bachelor of Science in Industrial Engineering

Submitted to:

Engr. Federico E. Delpozo Jr.

Submitted by:

Garcia Jr., Edgar L.

Ilagan, Abiel A.

Lusanta, Jhovie C.

Perez, Mark Joseph C.

Rabulan, Carlvin M.

Torres, Joshua Adrian P.

 ACKNOWLEDGEMENT

The researcher would indebted to so people who have suggested and shared their ideas to the

conceptualization of this research.

This Feasibility Study has been made possible by the guidance, supervision, cooperation and

participation of the following:

To our Almighty God who always look up and secure the safety of the proponents in doing this

project

To our parents for the financial assistance and who always guide and give words of wisdom to

inspire us in doing our best in preparing the Feasibility Study.

To our beloved intelligent Professor, Engr. Federico Del Pozo Jr., who has greatly shared his

knowledge with us with patience and diligence in helping us meet the necessary works for the

completion of our Feasibility study.

Sincerest gratitude is extended also to our respondents, the Business Administration Students of

Capitol University for the time they spent in the interview.

Together, we sincerely acknowledge and give thanks the person/s mentioned above who have

brought the success of doing this Feasibility Study. We are very grateful for this wonderful

accomplishment.
Introduction

The Filipino’s love affair with the bicycle has never waned ever since the time of its

introduction in Philippines society. In fact, bicycle use in the Philippines remain to be popular

these days, whether as mode of exercise and recreation, or mode of regular means of

transportation, as evidenced by the thousands of recreational riders and “weekend warriors”, and,

more importantly, the hordes of bicycle riding Filipino workers and laborers who can be seen

sharing the road with motorized transport users.

The technological advances the world has witnessed in this millennium have been

fascinating to say the least. With the invention of electric cars, solar cars, and other things, it was

only a matter of time before the power generating bicycle transformed from vision to reality.

Power generating bicycles might look like regular bicycles but they come with a self-sufficient

electricity by means of kinetic energy. The idea of power generating bicycle came onto the seen

not too long ago and has many iterative improvements.

Background of the Study

Philippine society, both in the urban and even rural settings, is confronted with the ever-

worsening myriad of intertwined issues such as climate change, air pollution, traffic and road

congestion, rising costs of gasoline and other commodities, personal health problems, and other

related issues.

Studies have consistently shown that bicycle use has wide reaching benefits, form

environmental and urban planning to public health. General and regular bicycle use by the public

lessen use of motorized transport, road congestion and demand for parking facilities, ultimately

translating to significantly reduced carbon emissions of the country, and also reduced

cardiovascular health risks to the general public health.

Accident Record in Laguna

13.41%
20.73%

65.87%

Bicycle Incident Car Accident

Motorcycle
However, in line to this matter,

bicycle also encounters some disadvantages when it come to road issues. According to the

Department of Transportation, 13% of the road accidents includes bicycle riding. Maybe it is not

noticeable but it is quite alarming for some individuals who love to bike.
Conceptual Framework

The technical study of the project comprises product description, product process,

equipment and materials, plant location and plant layout. In this area, it discusses on how the

product “Power generating Bicycle” is produce, what materials and equipments are needed, and

where will the researchers going to put the said business and its layout.

The marketing study covers the general business condition, competitive condition, target

market, demand, supply, product, pricing strategy, promotion, and packaging. This area talks

about the structured questionnaire floated to the respondents and the result determines the

demand and supply and for the researchers to know whether their product will penetrate the

target market.

The financial study shows the capitalization, sources of funds, total sales, total expenses,

income statement, balance sheet, cash flow statement, return on investment, and ratio analysis.

This area discusses if the business is profitable or not. In addition, it serves as a guide for the

researchers to know if the transactions within 3 years are increasing.

 The management study shows the form of ownership, the structure of the business, job

analysis and company policies that the researchers had formulated.

The socio-economic study shows the contribution of the study to the government and to

the society. This area proves that the business existed not only for profit purposes, but also for

the improvement of the welfare of the people.

 Socio
Technical Marketing Financial Management
Economic

General Contribution
Product Form of
Business Capitalization to the
Description Ownership
Condition Government

Product Competitive Sources of Contribution

Structure
Process Condition Funds to the Society

Equipment/
Demand Total Sales Job Analysis
Materials

Company
Plant Location Product Total Expenses
Policies

Pricing Income
Plant Layout
Strategy Statement

Promotion Balance Sheet

Cash flow
Packaging
Statement

Return on
Investment

Ratio Analysis
Scope and Limitation of the Study

This study of the power generating bicycle business is restricted to the province of

Laguna, and will be based on management, marketing, technical, socioeconomic, and financial

aspect of business. Three cities namely, Biñan, Sta. Rosa and Cabuyao will be covered as part of

the respondents. The product will be disseminated through direct selling and orders are also

accepted from the customer within Laguna from those who are willing to purchase our product.

Significance of the Study

The study gives the consumer a product which is affordable but with the same product

quality with those sold at an expensive price. This section will provide a brief description on the

various significances of the study given.

To the customers- the researchers believed that the customers will benefit because the study was

made for them and the researcher had priced the product at a reasonable price. They will benefit

by buying the product and they will see that it can be used for a long time.

To the researchers- in doing the study, the researchers have acquired new skills and knowledge

that they can use in their profession .This paper can enlighten their thinking with regards to the

reality of life especially as we walk towards the path of the business world
Definition of Terms

For a better comprehension on this feasibility study, the following definitions of terms are

provided:

 Balance Sheet- one of the financial statements that show the total assets, total liabilities

and equity of a business

 Break-even Point - refers to an indicator of the volume where profits equal zero, which

means no gain, no loss

 Capitalization - the monetary contribution of each partner in starting up a business
 Demand- refers to the quantity of goods does a buyer is willing to buy at a given price
 Form of Ownership - refers to a type of business form of organization
 Income Statement - type of financial statement that shows the annual sales of the

business with its expenses incurred for the whole year

 Management - the overall organizational structure of a certain business
 Marketing Strategy - a series of marketing activities that an organization do to acquire

customers
 Structured Questionnaire - a written instrument used in gathering information through

survey.

Chapter II

METHODOLOGY
 This chapter describes and discusses how the researchers will gather the necessary data

and information that will be used in the entire study. It describes who will be the respondents and

focus of the research. This also shows the procedure of source of data and methods of collecting

data. This chapter also discusses the type of research, research design, research locale where the

study will be conducted, and also the respondents of the study.

Research Design

The researchers used the descriptive design and applied using survey questionnaires and

key informant interview. The survey was conducted by providing structured questionnaires to a

number of identified respondents from three cities of Laguna, namely Biñan, Sta. Rosa, and

Cabuyao. The participants who were asked during the survey were randomly selected from

identified respondents. The survey was aided using an interview guide questioners. Moreover,

interviews were conducted with existing business operators who sell bikes which will serve as

key information on how we will improve more our product offerings to our target consumers.

Research Locale
 The researchers floated the survey questionnaires around three cities of Laguna. The

number of respondents that is being selected here is equally divided from three cities and is

informed briefly on what the research is all about. Therefore in this area, the researchers planned

to have their distribution of their products through consignment.

Respondents
 Due to a large number of people that may become the possible costumers, the researchers

got at least 300 respondents from the identified research locale. Respondents were identified

immediately after they have shown interest in buying power generating bicycle.

No. of Respondents
Cities
Biñan 100

Sta. Rosa 100

Cabuyao 100

TOTAL 300

TECHNICAL STUDY
 This study discusses about the process of production and the activities of the business. It

states also the machineries and equipment used in production and other aspect regarding bringing

the raw material into finished products ready for trade. Plant layout, size and structures are all

presented for the purpose of identifying the business operation. Also product specifications the

product processes using the flow chart. The list of machinery, tools and equipment are

enumerated with their corresponding cost, raw materials and plant fund sources are also cited.

Product Perspective
 Front Light

Rear Light

Dynamo Motor
Main Parts of the Product

Frame

A bicycle frame is the main component of a bicycle, onto which wheels and other

components are fitted. The great majority of modern bicycles have a frame with upright seating

that looks much like the first chain-driven bike. These upright bicycles almost always feature the

diamond frame, a truss consisting of two triangles: the front triangle and the rear triangle. The

front triangle consists of the head tube, top tube, down tube, and seat tube. The head tube

contains the headset, the set of bearings that allows the fork to turn smoothly for steering and

balance. The top tube connects the head tube to the seat tube at the top, and the down tube

connects the head tube to the bottom bracket. The rear triangle consists of the seat tube and

paired chain stays and seat stays. The chain stays run parallel to the chain, connecting the bottom

bracket to the rear dropout, where the axle for the rear wheel is held. The seat stays connect the

top of the seat tube (at or near the same point as the top tube) to the rear fork ends.

Specification:

 Frame size: 26 x 13 in.

 Integrated alloy
 Fig

ure 1: Bicycle Frame

Handlebars

The handlebars connect to the

stem that connects to the fork that

connects to the front wheel, and the whole assembly connects to the bike and rotates about the

steering axis via the headset bearings. Different types of handlebars are used in common.

However, mountain bikes generally feature a 'straight handlebar' or 'riser bar' with varying

degrees of sweep backwards and centimeters rise upwards, as well as wider widths which can

provide better handling due to increased leverage against the wheel.

Specification:

 Component: Flat Handlebar

 Width: 600mm

 Clamp Diameter: 26.5mm

 Material: Carbon Fibre

 Figure 2: Bicycle
Handlebar

Saddles

A bicycle saddle, often called a seat, is one of three contact points on an upright bicycle,

the others being the pedals and the handlebars. Saddles also vary with rider preference, from the

cushioned ones favored by short-distance riders to narrower saddles which allow more room for

leg swings. Comfort depends on riding position. With comfort bikes and hybrids, cyclists sit high

over the seat, their weight directed down onto the saddle, such that a wider and more cushioned

saddle is preferable. For racing bikes where the rider is bent over, weight is more evenly

distributed between the handlebars and saddle, the hips are flexed, and a narrower and harder

saddle is more efficient. Differing saddle designs exist for male and female cyclists,

accommodating the genders' differing anatomies and sit bone width measurements, although

bikes typically are sold with saddles most appropriate for men. Suspension seat posts and seat

springs provide comfort by absorbing shock but can add to the overall weight of the bicycle.
Specification:

 Shell: Leather

 Cover: leather

 Rails: Carbon Fiber 7mm diameter

 Saddle Clamp: 22mm

Figure 3: Bicycle Saddle

Brakes

A bicycle brake reduces the speed of a bicycle or prevents it from moving. There are

different types of brakes. Bicycle brakes may be rim brakes, in which friction pads are

compressed against the wheel rim. Hub brakes, where the mechanism is contained within the

wheel hub. Disc brakes, where pads act on a rotor attached to the hub. Most road bicycles use

rim brakes, but some use disk brakes. Disc brakes are more common for mountain bikes,

tandems and recumbent bicycles than on other types of bicycles, due to their increased power,

coupled with an increased weight and complexity. With hand-operated brakes, force is applied to

brake levers mounted on the handlebars and transmitted via hydraulic lines to the friction pads,

which apply pressure to the braking surface, causing friction which slows the bicycle down.

Specification:
  Brake Lever Diameter: 23mm

 Material: Alloy

 NT weight: 625g

Figure 4: Bicycle Brakes

Drivetrain and Gearing

The drivetrain begins with pedals which rotate the cranks, which are held in axis by the

bottom bracket. Most bicycles use a chain to transmit power to the rear wheel. A very small

number of bicycles use a shaft drive to transmit power, or special belts. Hydraulic bicycle

transmissions have been built, but they are currently inefficient and complex. However, different

gears and ranges of gears are appropriate for different people and styles of cycling. Multi-speed

bicycles allow gear selection to suit the circumstances: a cyclist could use a high gear when

cycling downhill, a medium gear when cycling on a flat road, and a low gear when cycling

uphill. In a lower gear every turn of the pedals leads to fewer rotations of the rear wheel. This

allows the energy required to move the same distance to be distributed over more pedal turns,

reducing fatigue when riding uphill, with a heavy load, or against strong winds. A higher gear
allows a cyclist to make fewer pedal turns to maintain a given speed, but with more effort per

turn of the pedals.

Specification:

 Bicycle pedal: 9/16"

x 20 tpi threads.

 Crank Arm: 175mm

Figure 5: Drivetrain and gearing

Wheels and Tires

Bicycle wheels are typically designed to fit into the frame and fork via dropouts, and hold

bicycle tires. Tires vary enormously depending on their intended purpose. The wheel axle fits

into fork ends in the frame and fork. A pair of wheels may be called a wheelset, especially in the

context of ready-built "off the shelf", performance-oriented wheels.

Specification:

 Can be made lighter, stiffer and stronger than other sizes

 Loads of existing 26in wheels, tires, forks and bikes makes spares cheap and easy to find
  Feels lumpier and stalls easier than bigger wheels on rough terrain.

Figure 7: Bicycle Wheel and Tire

Specialized Parts

From time to time, bicycle has undergone continual adaptation and improvement since its

inception. These innovations have continued with the advent of modern materials and computer-

aided design, allowing for a proliferation of specialized bicycle types, improved bicycle safety,

and riding comfort.

As part of this innovation, this bicycle products are adding some specialized parts to

improve their functionality and usefulness.

Dynamo Motor

A dynamo is an electrical generator that creates direct current using a commutator, a

rotary electrical switch in certain types of electric motors and electrical generators that
periodically reverses the current direction between the rotor and the external circuit. It can be

used as a stand-alone light system on your bike. The electric dynamo uses rotating coils of wire

and magnetic fields to convert mechanical rotation into a pulsing direct electric current through

Faraday's law of induction. Dynamos were used in motor vehicles to generate electricity for

battery charging.

Figure 8: Dynamo Motor

Specification:

 Material: steel silver

 Input Voltage: 12v

 Diameter: 37mm

 RPM: 3.5RPM

 Shaft L: 9.5mm

 Shaft D: 6mm

 Shaft W: 149g
Accessories

Some components, which are often optional accessories on bicycles, are standard features

on mountain bicycles to enhance their usefulness and comfort. Other accessories such as lights

and horns are installed on the bicycles to consider and promote safety and visibility.

Figure 9: Bicycle horn (left) and light (right)

Horn

Specification:

 Diameter: 70mm

 Sound output: 105db

 Power: 12v

 Handle length: 89mm

  Black

Headlight

Specification:

 Material: aluminum

 Power: 20W

 V: 12-85v

 LED light

 Life span: 5years 7 months

 Size: 55mm

Battery

Specification
  Motolite Brand - Best Quality

 Rechargeable Battery

 Input/Output Voltage: 12Volts

 Capacity: 7Amperehour

 Charging Time after Total discharge: 6-8 hour

 Valve Regulated

 Sealed Lead-Acid Battery

 Used in Emergency Lights, Lanterns, etc.

 LWH – 70mm x 47mm x 101mm, TH - 107mm- include terminal

Service Life of Battery

A battery lasts for 2 to 3 years depending on the weather and road conditions.

Lead Acid Battery Economics

First, we will review very briefly the current economics of the lead industry. Of the major

end uses of lead, only storage batteries, representing 70 percent of the lead market in the U.S.,

continue to experience growth, currently forecast at 1 percent per year. Consumption of leaded

gasoline and lead pigments has declined due to environmental regulations and public concern,

and is expected to continue to decline through the 1990s. Similarly, total worldwide consumption

of lead is expected to continue the flat or downward trend that it has experienced since 1980. In
general, unlike lead demand, the supply potential of the world lead producers has not fallen. One

reason for the oversupply of lead in the market is that much of the lead is produced in

conjunction with other growing metals markets such as zinc. An increase in zinc production

translates into an increase in lead production without a commensurate increase in lead demand.

Consequently, the burden of equilibrating lead supply and demand falls on the marginal

producers of pure lead.

Sustainability Plan

Ever-growing global energy needs and environmental damage have motivated the pursuit

of sustainable energy sources and storage technologies. As attractive energy storage technologies

to integrate renewable resources and electric transportation, rechargeable batteries especially lead

acid battery, are undergoing unprecedented rapid development. However, the intrinsic toxicity of
rechargeable batteries arising from their use of toxic materials is potentially environmentally

hazardous. Additionally, the massive production of batteries consumes numerous resources,

some of which are scarce. It is therefore essential to consider battery recycling when developing

battery systems.

Here, we consider a systematic overview of rechargeable battery recycling from a

sustainable perspective. We introduce the concept of sustainability through a discussion of the

life-cycle assessment of battery recycling. A reinterpreted 3R strategy entailing redesign, reuse,

and recycling is recommended for the future development of battery recycling.

The sustainability plan of the product we consider is based on the 3R and 3E as shown in

the diagram above. Since some of the materials used in the production of battery encounter

scarcity, we make a project of recycling the EOL batteries by redesigning and replacing the

damaged part of obsolete batteries through the help and support of our supplier. They reproduce

batteries from obsolete batteries to maintain sustainability for the future development of battery.
Life Cycle Assessment of Battery

Gate to Grave

Product Manufacture
 Global Warming
(kg CO2 eq.)
40 35.1
35 29.8
30 25.6
25
20
15
10
9.47 9.47 8.29
3.55 3.55
5.92
5 2.63 0.79
0
ng g ng ng ng ng g ng y
on in on i i i ri n bl
uc
ti sti ix sti ati ld ld ld te sti em
ca M Pa rm o o o in ca s
od id ste Fo xm rm m s rts As
pr Gr gs C
e Pa Bo ove u PV pa
id C Pl al
l
ox
ad Sm
Le

Gl obal Warmi ng
(kg CO2 eq.)

Acidification
(kg SO2 eq.)
0.12
0.11
0.1

0.08
0.07

0.06

0.04 0.04

0.02

0
Pasting Formation As s embl y
Acidi fication
(kg SO2 eq.)
 Human Toxicity
(kg 1,4 BD eq.)
0.3

0.25
0.24
0.2

0.15

0.1
0.06
0.05
0.05 0.04
0.01 0.01 0.01
0 0 0
0
Lea d oxi de formul ation Pa ste Mi xi ng Formation Cover mol ding Sma ll pa rts casting
Human Toxi ci ty
(kg 1,4 BD eq.)

Based on the gathered data, the result found out that the environmental impact of lead

acid battery (motorcycle battery) spreads out in every stage. Using life cycle assessment analysis

from gate to grave, results have shown that assembly process represents most significant impact

on acidification which contributes 50% and a major contribution to human toxicity which leads

to 59%. Also, it contributes to global warming potential with a 4.41% of the total global warming

potential of the lead acid battery process.

Product Use

Emission to air (kg)

PM10 0.19
Pb 0.00303 (0.005kg CO2)
CO2 5.92
SO2 0.134 (0.06kg CO2)
 Based on the result data, total emission of air composed of 0.19kg of PM 10, and 6.059kg

of CO2.

Product End of Life

Lead Acid Battery Recycling

6
5.29
5

1 0.6

0
SO2 CO2
Lead Aci d Battery Recycl i ng

Based on the gathered data, 5.29 kg of CO2 and 0.6kg of SO2 (0.264kg of CO2) contribute

to gas emission during lead acid battery recycling.

Therefore, we conclude that the total gas emission during gate to grave life cycle

assessment of battery is equivalent to 17.58 kg of CO2, 0.19 kg of PM10, and 0.244 kg of BD that

contribute to some greenhouse gases effect like acidification, human toxicity, and global

warming potential.
Process Flowchart

START

Paint Shop

Pre-Assembly

Testing
Wheel Assembly

Assembly

Packaging

END

Process Description

An assembly process or assembly line is a manufacturing process in which parts are added as

the semi-finished assembly moves from workstation to workstation where the parts are added in
sequence until the final assembly is produced. In our assembly process we have 5 different

stations considered.

1. Paint Shop

Each frame is given 4 individual coats of paint, and each application is quality

checked to ensure even smooth coverage. Our attention to detail is unparalleled; the decal

of every bike is applied by hand in the final stage.

2. Pre-Assembly

In pre-assembly, we make sure that all of the parts are ready and all stand-by.

From front forks, sprockets, chains to fit from every bikes and cable.

3. Wheel Assembly

First, we guide the spokes into the right place in the wheel. Next, tensioning the

wheel to ensure the spokes are well-positioned and to be sure of a smooth ride, we tighten

the spokes to truing the wheel and keep doing this until we assure the wheel is perfectly

round. The final step is the tire, pump-up the inner tube, fit the tire and it’s good to go.

4. Assembly

This is where all parts come together, the frame starts its journey along the

assembly line with the front fork and the handle bars fitted. All of the parts from our paint

shop and pre-assembly are ready and waiting. Step-by-step with precision and attention

to detail, the staff fit and check each component the mud guard, the wheels, the battery,
 the dynamo, and other accessories including horn, signal lights, headlight, brake light and

USB portal.

5. Test Lab

In our company, quality is paramount. That’s why we test our bikes continuously

in our test lab. First, the roller conveyor. We ran our test bikes overnight at least 18,000

kilometers. Second, the vibration bench. It vibrates all day long. Third, the salt spray

bath. We simulate 2 years of changeable weather in just 7 days to ensure our bikes

commit stand all weather conditions without rusting. To be sure that our electrical

components are water proof, we can put them into the water column with 5 bars of

pressure. We test our colors using prolonged exposure to UV light, we simulate sunlight

to ensure our bikes won’t lose their color. And we check if our bikes can handle anything

that could happen on the road on our own test track like cobbles, sudden braking and

sharp bends. We also monitor the quality of the production process, we test around 5%

sample of all bikes we make.

Testing Methodology
 Product testing is a research methodology allowing businesses to collect qualitative and

quantitative information about consumer’s potential consumption/usage behavior, preferences,

and reactions on a product. There are different approaches used in product testing depending on

what type of product is needed to be tested. The product testing approach that we want to

introduce and apply is the CLT or the Central Location Testing. It is a traditional market research

testing approach whereas consumers are getting recruited to participate in research within

controlled environments. These controlled environments can be an open place where consumers

come to consume and use the product, and then, share their experience based on what they

encounter. It is a traditional market research.

Central Location Testing Approach is composed of three stages.

 Before Consumption

In this stage, the initial reaction of the consumer based on our product packaging

is observed. The feedback of consumer based on the packaging design, including the

appearance, portion, smell, etc., is being asked.

 Preparation Consumption

In this stage, consumers start to prepare and use the product, which allows them to

observe the way the product is prepared and used. This is the most critical part of

receiving the most extensive product experience insights from this stage.

 After Consumption
In this stage, consumers evaluate the overall product and learn the overall evaluation and

behavior impact on the state of the consumer.

MARKETING STUDY
 This chapter will help to know the marketing aspect of the business. The marketing

aspects will cover the following: General Business Condition, Tabulation of Results, Target

Market, Demand, Product, Promotion, Marketing strategy, Pricing Strategy, Promotion and

Packaging.

For the business to prosper, it should be given time and effort. The proponent of this

business must have the desired creativity so as to be able to provide quality service to its

customers. The fulfillment of the needs and wants of its customers or target market must be the

key objective of the recommended business.

In every project, feasibility marketing aspect is well-thought-out the most important since

it requires inconspicuous analysis of the business total demand and supply.

Description and Outlook of the Industry

 As experienced in the recent years, demand for bike industry is continually increasing

due factors which include convenience, and changing lifestyle. The trend of health and wellness

shift the demand to go upward because a lot of people choose to go to healthy lifestyle. In our

survey conducted among the factors that they consider in purchasing choice of our respondents,

safety ranks the highest factor they consider in purchasing bike products.

Our group would want to introduce power generating bicycle in the market because our

group envisioned putting up stores highlighting mountain bike that can generate its own power to

supply different accessories built to the bike product. Through this, we foresaw that its industry

will be much broader and in turn, will array as one of the most excellent bike products.

Size of the Industry

 According to the 2015 Census of the Population of the Philippines, the three cities in

Laguna have a total estimated population of 1 billion. This was based on the last census

conducted last 2015. This data gives us the opportunity to have a look on how large is the market

in a scale of the city.

Target Market

Power generating bicycle wants to distress the purchasing influence of most of the

Filipinos as it is offering an affordable price and addressing health and wellness trends in our

product offerings. At ages 18-50 is the target market of power generating bicycle, professional or

not, male or female and people of different walk of life. Most especially, the people within a

healthy lifestyle are set as our target market. This confirms a big scope of market will cater.

Market Segmentation
 Power generating bicycle considers restriction in ages 18-50, what places they came

from, but particularly in Laguna, and no matter what their gender and religion either who have

high or low income can be our target market that can be one of our potential buyers for the

benefits of our potential customers we extend our time and effort to differentiate and understand

their needs, wants and their preferences in order to meet the satisfaction of our innovated

product.
Demand Study

Bike Shops Consumptions in Laguna

Bikeman 10
Siklista 8
GoldSpeed8 9
Bikeworx 8
Tulang 12
Clark’s Cycle 8
Average Consumption 9.16 = 10

1. What mode of transportation do you ride the most? Rate them from 1(lowest) to 4(highest)
Respondent’s Answer
Private Car 2.77
PUV 2.43
Motorcycle 2.96
Bicycle 2.97
The data above shows that the 307 respondents ranked the most is the bicycle which got

2.97, followed by motorcycle which got 2.96. Also, followed by private car which got 2.77 and

the PUV’s which got 2.43.

2. Have you ever experienced to ride a bicycle?

Respondent’s Answer
Yes 305
No 2

The results show that there are 305 of respondents experienced to ride a bicycle while

only 2 of the respondents said that they don’t.

3. What type of trips do you take on your bicycle?

Respondent’s Answer
Exercise 220
Primary Transportation 57
Shopping 2
Recreation 28
 According to 307 respondents based on the type of trips they want in riding bicycle; the

majority is exercise that gained 220 responses while the primary transportation has 57 responses.

Also, recreation gained 28 responses and shopping which has 2 responses.

4. How often do you make a bicycle trip?

Respondent’s Answer
Daily 109
More than 4 days a week 4
2 to 4 days a week 18
Weekly 41
Monthly 135

The data shows that 135 of the respondents make a bicycle trip monthly while 109

respondents make it daily. Also 41 of the respondents answered weekly and the 18 respondents
answered 2 to 4 days a week. Lastly, the remaining 4 respondents said that the make a bicycle

trip more than 4 days a week.

5. Rate based on your bicycle preferences. (5-highest and 1-lowest)

Respondent’s Answer
Performance 3.90
Aesthetics 3.53
Weight 4.20
Special Features 4.19
Safety 4.45

The data above shows

that the 307 respondents

ranked the most, in terms of bicycle

features, is safety which got 4.45,

followed by weight which got 4.20.

Also, followed by special features which got 4.19, performance which got 3.90 and the aesthetics

which is 3.53.
6. What accessories do you prefer in your bike?

Respondent’s Answer
Headlight 210
Horn 231
Charger port 185
Signal light 195
Nothing 18

Based on the results answered by the respondents, 231 respondents prefer the horn accessories in

their bike, while 210 prefer headlight. Also, 195 respondents prefer signal light while 185 prefer

charger port. However, the remaining 18 respondents prefer to have nothing and be as it is.

7. Have you ever heard a concept of power generating bicycle?

 Respondent’s Answer
Yes 270
No 37

The data

shows that there are

270 of the respondents said that they heard a concept of power generating bicycle while only 37

of the respondents don’t.

8. Do you think that a self-power-generating bicycle is a good material of investment?

Respondent’s Answer
Yes 301
No 6

The data shows that 98% of the respondents think that a self-power generating bicycle is

a good material investment while 2% of them opposed.

9. How much is your expected price for a power generating bicycle?

Respondent’s Answer
5000-6000 45
7000-8000 64
9000-10,000 154
More than 10,000 43

The data shows that the expected price of the respondents in power generating bicycle.

The majority answered 9,000-10,000 which gained 154 responses while the second is 7,000-

8,000 which has 64 responses. Also, 5000-6000 gained 45 responses while the rest answered

more than 10,000.

Packaging
 Packaging is an important role as a medium in the marketing mix, in promotional

campaigns, as a pricing criterion, in defining the character of new products, as a setter of trends

and as an instrument to create brand identity and shelf impact in all product groups.

Marketing Strategy
 The first strategy is market penetrate. Power generating bicycle is committed to

improving the customer experience in ways they believe few in the industry have done.

This business plan to execute a broader marketing strategy, not simply to build name

recognition and awareness but also to build deeper relationships with the target customers whom

they believe will help promote the brand. To reach the target customer group, we use a mix of the

following marketing methods: radio, billboards, social networking, television and in-store

sampling. Expect to continue to increase media impressions as they strive to build deeper

relationships with their customers. We believe marketing represents an opportunity to create

additional competitive advantage and brand awareness.

The next strategy is market development. The expansion into Filipino has made them

subject to Filipino economic conditions, particularly currency exchange rate fluctuations and

political factors, either of which could have an adverse effect on the financial condition and

results of operations. If power generating bicycle, expands into other foreign markets, will be

subject to other foreign economic conditions and political factors including taxation.

Price
 The pricing of each bike is based from the survey questionnaire gathered by the

researchers. The researchers floated survey questionnaires with an option of prices. Then the

costing of products immediately adjusted based from its sole so that it would compensate the

pricing from the survey questionnaire. Each bike cost from 8,000 pesos based on the research

result that we conduct, but it will adjust based on the economic growth of the country or the price

of raw materials and for the transportation and etc. that will affect the price of the product. The

product price will be dependent on how the market price of the raw material is. Any changes in

the price of power generating bicycle will be taken into consideration to the factor that measures

the consumers' capability to purchase the product.

FINANCIAL STUDY
 This chapter discusses the financial aspects of the study, in order for a business plan to

understand it needs money to start. To determine whether the future industry will remain

profitable through the existence of competitors and unfavorable economic condition, the

researchers have to project a five year financial statement. This chapter includes the source of

funds, balance sheet, income statement, cost of goods sold and cost of sales.

Financial Assumptions

1. Selling Price of the product is 8,000 pesos.

2. Sales demand increases 10% per year.
3. Raw materials increases 5% per year.
4. Depreciation expense is computed in a straight line basis with an estimated useful life of

3 years.
5. 50% of net income will be distributed after 3 years.

Initial Capital Requirements

 The partners agreed to contribute an equal sharing of capital in amount of ₱ 543,027.30

each.

Partners Ratio Invested Amount

Garcia, Edgar L. Jr. 16.67% ₱ 543,027.30
Ilagan, Abiel A. 16.67% ₱ 543,027.30
Lusanta, Jhovie C. 16.67% ₱ 543,027.30
Perez, Mark Joseph C. 16.67% ₱ 543,027.30
Rabulan, Carlvin M. 16.67% ₱ 543,027.30
Torres, Joshua Adrian P. 16.67% ₱ 543,027.30
TOTAL 100% ₱ 3,258,163.80

Cost and Expenses Schedule

Schedule 1

Purchased of Raw Materials

Quantity per Production
Item Unit Price Amount
Monthly Yearly
Assembled Bike 200 pcs. 2400 pcs. 3,000.00 7,200,000.00
Motolite Battery 200 pcs. 2400 pcs. 950.00 2,280,000.00
Head Light 200 pcs. 2400 pcs. 150.00 849,600.00
Rear Light 200 pcs. 2400 pcs. 50.00 120,000.00
Signal Light 200pcs. 48 boxes (50) 500.00 24,000.00
Horn 200 pcs. 2400 pcs. 100.00 240,000.00
Wires 800 yards. 9,600 yards 200.00 (per 50) 38,400.00
Motorcycle Sprocket 200 2400 50.00 120,000.00
Free wheel Sprocket 200 2400 60.00 144,000.00
Chains 70 840 100.00 84,000.00
TOTAL 11,100,000.00

Schedule 2

RENT EXPENSE
Monthly Annual Cost
10,000.00 120,000.00

Schedule 3

Salaries and Wages

Position Number of Worker Monthly Cost Annual Cost
Manager 1 25,000.00 300,000.00
Marketing and Sales
1 15,000.00 180,000.00
Agent
Skilled Laborer 2 15,000.00 (7,500each) 180,000.00
 TOTAL 660,000.00

Schedule 4

Office Supplies
Item Quantity Price Annual Cost
Record Book 2 80.00 160.00
Official Receipt 30 20.00 600.00
Ball pen 12 5.50 66.00
Bond Paper 4 50.00 200.00
Puncher 1 65.00 65.00
Stapler 2 32.00 64.00
Staple Wire 20 7.00 140.00
Fastener 2 30.00 60.00
TOTAL 1,355.00

Schedule 5

Office Furniture and Fixtures

Estimated Depreciation
Item Quantity Price Amount
Useful Life Expense
Table 1 1,500.00 1,500.00 3 500.00
Office Chair 2 300.00 600.00 3 200.00
Ceiling fan 1 750.00 750.00 3 250.00
Cabinets 1 1,000.00 1,000.00 3 333.33
TOTAL 1,283.33

Schedule 6
 Equipment
Item Quantity Price Amount
Computer 1 15,000.00 15,000.00
Welding Machine 1 3,689.00 3,689.00

Schedule 7

Packaging
Item Quantity Unit Price Monthly Cost Annual Cost
Bubble Wrap 1 2,065.60 2,065.60 24,787.20

Schedule 8

Depreciation Expense
Estimated Depreciation
Item Cost
2019 2020 2021
Life
Office
(see schedule
Furniture and 3,850.00 1,283.33 2,566.67 3,850.00
5)
Fixtures
Equipment 18,689.00 3 6229.67. 12,459.33 18,689.00
TOTAL 7513.00 15,026.00 22,539.00

Schedule 9

Promotional Expenses
Cost Number of Months Annual Cost
2,999.90 Introduction of the
Helmet 2,999.90
(299.99 x 10pcs) product
Ads materials 500.00 12 6,000.00
Total 8,999.90

Statement of Cost of Goods Sold

 2019 2020 2021
Beg. Inventory - - -
Add:
Purchase of Raw Materials 11,550,000.00 12,127,500.00 12,733,875.00
Direct Labor 180,000.00 180,000.00 180,000.00
Overhead:
Packaging 24,787.20 24,787.20 24,787.20
Indirect Labor 480,000.00 480,000.00 480,000.00
Cost of Goods Sold 12,234,787.20 12,812,287.20 13,418,662.20

Projected Demand for the year 2019-2021

2019 2020 2021
2,400 2,640 2,904

Projected Sales for the year 2019-2021

2019 2020 2021
19,200,000.00 21,120,000.00 23,232,000.00
 Projected Income Statement

For the year ended Dec. 31, 2019-Dec. 31, 2021

2019 2020 2021
Sales 19,200,000.00 21,120,000.00 23,232,000.00
Less: COGS 12,234,787.20 12,812,287.20 13,418,662.20
Gross Income 6,965,212.80 8,307,712.80 9,813,337.80

Less: Operating Expenses

Rent Expense 120,000.00 120,000.00 120,000.00
Salary 660,000.00 660,000.00 660,000.00
Office Supplies 1,355.00 1,355.00 1,355.00
Depreciation 7,513.00 7,513.00 7,513.00
Promotional 8,999.90 8,999.90 8,999.90
Total Operating Expenses 797,867.90 797,867.90 797,867.90
Income Before Tax 6,167,344.90 7,509,844.90 9,015,469.90
Less: Income Tax (5%) 308,367.245 375,492.245 450,773.495
Net Income 5,858,977.655 7,134,352.655 8,564,696.405

Projected Income Statement

 For the year ended Dec. 31, 2019-Dec. 31, 2021
2019 2020 2021
Cash Inflows
Cash, Beg 9,672,119.455 17,563,985.11
Partners Contribution 3,258,163.80
Sales 19,200,000.00 21,120,000.00 23,232,000.00
Total Cash Inflows 22,458,163.80 30,882,119.46 40,795,985.11

Less: Operating Expenses

Purchase of Fixed Assets 22,539.00
Purchase of Raw Materials 11,550,000.00 12,127,500.00 12,733,875.00
Packaging 24,787.20 24,787.20 24,787.20
Direct Labor 180,000.00 180,000.00 180,000.00
Indirect Labor 480,000.00 480,000.00 480,000.00
Rent Expense 120,000.00 120,000.00 120,000.00
Office Supplies 1,355.00 1,355.00 1,355.00
Promotional 8,999.90 8,999.90 8,999.90
Income Tax (5%) 308,367.245 375,492.245 450,773.495
Total Operating Expenses 12,696,048.35 13,318,134.35 13,999,790.60
Cash, End 9,672,119.455 17,563,985.11 26,796,194.52

Projected Balance Sheet

As of Dec. 31, 2019-Dec. 31, 2021

2019 2020 2021
Assets
Current Assets
Cash 9,672,119.455 17,563,985.11 26,796,194.52
Total Current Assets 9,672,119.455 17,563,985.11 26,796,194.52

Non-Current Assets
Office

Furnitures & 3,850.00 3,850.00 3,850.00

Fixtures
Equipment 18,689.00 18,689.00 18,689.00
Total 22,539.00 22,539.00 22,539.00
Less: Accumulated 7513.00 15,026.00 22,539.00
Depreciation
Total Non-Current
15,026.00 7513.00 0
Assets

Total Assets 9,687,145.455 17,571,498.11 26,796,194.52

Liabilities and Equity

Current Liabilities

Partners Equity
Partners

Contributio 3,258,163.80 9,687,145.455 17,571,498.11

n
Add: Net
5,858,977.655 7,134,352.655 8,564,696.405
Income
Total Liability &
9,687,145.455 17,571,498.11 26,796,194.52
Equity, End
 Financial Ratio
2019 2020 2021
5,858,977.655 7,134,352.655 8,564,696.405
Profit Margin 19,200,000.00 21,120,000.00 23,232,000.00
30.52% 33.78% 36.87%
Return on 5,858,977.655 7,134,352.655 8,564,696.405
3,258,163.80 3,258,163.80 3,258,163.80
Investment 1.80 2.19 2.63
Return on Total 19,200,000.00 21,120,000.00 23,232,000.00
9,687,145.455 17,571,498.11 26,796,194.52
Assets 1.98 1.20 0.87
Return on Total 19,200,000.00 21,120,000.00 23,232,000.00
9,687,145.455 17,571,498.11 26,796,194.52
Equity 1.98 1.20 0.87
Fixed Asset 6,965,212.80 8,307,712.80 9,813,337.80
9,687,145.455 17,571,498.11 26,796,194.52
Turnover
6,965,212.80 8,307,712.80 9,813,337.80

MANAGEMENT STUDY

This chapter tackles about the entire organizational arrangement of the business. The

management aspect suggests a clear and precise identification of duties and responsibilities, flow
of authority and manpower level requirement. This contains the organizational chart and the

qualifications of the people involved the formation of the business organization, structure. It

must be set up aimed at optimum effectiveness. To attain this, management must be able to plan

all activities, for the company to become dynamic and competitive business over and done with

human resource, financial capability and new technologies.

Form of Ownership

The type of business ownership will be a partnership; in which partners pool money,

skills, and other resources, and share profit and loss in accordance with the terms of the

partnership agreement. In the absence of such agreement, a partnership is assumed to exit where

the participants in an enterprise agree to share the associated risks and rewards proportionately.

Complementary skills and additional contacts of each pattern can lead to the achievement of

greater financial results together than would be possible apart. Mutual support and motivation are

needed for the business to last longer.

Organizational Chart
 Owner

Marketing
Operations
and Sales Finance
Manager
Manager

Worker 1 Worker 2 Worker 3 Worker 4

Company Vision Statement

“To be established as one of the top bicycle manufacturing companies in the country and

provide innovative and quality products to our customers.”

Company Mission Statement

“To be a profitable high quality bicycle manufacturer, deliver value to our customers, and

create a company that can attract, recruit, and retain smart and talented employees.”

SOCIO ECONOMIC STUDY

 The chapter includes the socio-economic benefits if the proposed project. The proposed

project aims to help our localities to give healthy lifestyle to the people. Nowadays it is

important that small entrepreneurs should realize the worth innovating and starting a business

that would largely contribute to the socio-economic development of the country. In this certain

project, the researchers consider the whole part of the business especially the social impact

Income
Improve status
of Living
Employment

Projects
Taxes
Government
Community
Development

Contribution to Income and Employment

 The main goal of a certain business is to have high income especially in the part of the

owner. The business should generate pleasantly relationship between the manager and employees

to attain the main goal of the business which is to have an income. At workers and employees in

the business need income to support their own needs and also for their services rendered in the

business. Building up business is a great opportunity for an employed people to have jobs. It will

also be their opportunity of having another source of income.

As part of company’s CSR, we will participate on the different job fairs organized by the

community. This is to help individual to be profitable through the help of our company.

Tax Contribution

This business is expected to give a great contribution to the government in the form of

taxes. The tax payment from the business which is 32% would help the localities as well as the

economy in its future project especially for people that will benefit. This would help the people

to more sprightly.