PJ Patties Shop: A Feasibility Study: Executive Summary

PJ Patties Shop: A Feasibility Study
Chapter I
Executive Summary
The business enterprise is a new venture and will be implemented in the future. It
is a sole proprietorship form of business organization. Owned and managed by the
proprietor himself but he is helped by her two assistants. It will be established and will
start its operations at downtown of San Jose, Malilipot, Albay.
The enterprise will be a small-scale business enterprise which will provide a
pleasant and convenient store for the costumers who will patronize our product. PJ Patties
Shop owned by the owner himself, who build his business at San Jose, Malilipot, Albay.
The business offers a unique taste of patty which will serve as an alternative instead of
different basic foods such as rice, it is best supplement to lessen too much carbohydrates.
The business is entirely new, does not know or have any experience and people
who manages it are all first-timers in the field of business but they assure that will
achieve the goals and objectives of the business.
MISION
 To excel in sales and distribution of chicken patties using a carefully devised
marketing program towards local competitiveness.
 To provide a lower cost and palatable tastes of patties new products.
 To provide a nutritious supplement for any other foods.
PJ Patties Shop 1
VISION
PJ Patties Shop is a legal venture committed to become well-known suppliers all
over the region towards the stability for the economic production and provided by the
proper management for a good welfare.
OBJECTIVE
PJ Patties Shop is able to create a unique marketing strategy to the market and to
maintain market sustainability in order to meet competitive challenge and overcome
market barriers.
PJ Patties Shop 2
Chapter II
Company Overview
Name, Nature and location of the business.
Name of the business: PJ Patties Shop
Nature of the business: Dealer (wholesaling and retailing)
Location: Zone #5, Datag, San Jose, Malilipot, Albay
PJ Patties Shop is own and manage by __________________the owner and
general manager of the business.
Legal Business Description: Sole Proprietorship
i. Form of business organization:
The proposed business is in the form of sole proprietorship. It will easily manage
and operate by one individual. On the other hand, we could not easily operate our
business without the help of prospective employees with high potential business
establishment.
In sole proprietorship, the main owner shall be liable from all phases in the company
either shortages or surplus of the capital.
ii. Licensing and other requirements for setting up the business
In putting up PJ Patties Shop there have several permits that the owner needs to
get. The owner need to comply and accomplish all the permits as requirements to make
the business legal and they are the following:
PJ Patties Shop 3
1. Barangay Clearance
2. Mayor’s permit
3. DTI
4. BIR
List of owner:
Jeffrey C. Paras
Management Team
Organizational Structure
Below is the organizational chart which describes in a capsule form the flow of
authority from the manager to her assistants:
General
Manager
1st Assistant 2nd Assistant
Lists of officers and staffs:
PJ Patties Shop 4
 General Manager (owner) –
 1st Assistant-
 2nd Assistant-
Job Description and Specification
Below are the job descriptions which describe the function of the people involved
in the operation of the business:
A. OWNER and GENERAL MANAGER

1. Overall in-charge of the business and engages in the management aspects of the
enterprise;
2. Primarily responsible in the financial aspects of the enterprise;
3. Prepares the financial statements at the end of every 6 months from the start of
operations;
4. Does the overall inventory of raw materials as well as the inventory of finished
products;
5. Washes the kitchen utensils used before leaving the workplace;
6. Keeps an inventory of finished products on a daily basis;
7. Assists in the sale of finished products.
PERSONAL REQUIREMENTS
PJ Patties Shop 5
Below is the statement of the qualifications and traits in terms of skills,
experience, trainings required in the effective performance of each task.
A. OWNER AND GENERAL MANAGER
1. Knowledgeable in the operation and management of a sole proprietorship
enterprise;
2. Must have an excellent sales talk ability;
3. Must be confident and optimistic;
4. Must know basic accounting and bookkeeping;
5. A graduate of business related courses;
6. At least 18-35 years old.
B) FIRST ASSISTANT
1. Must be hardworking;
2. Must be willing to work under pressure;
3. Must be flexible at all times;
4. Must have knowledge in making simple reports;
5. Must know how to communicate in English and the local dialect;
6. Must be physically fit;
7. Must have pleasing personality;
8. Must have knowledge in inventory reporting;
9. Must be a graduate of any business course;
10. Can adapt to quality standard.
C.SECOND ASSISTANT
PJ Patties Shop 6
1. Must have special skills in cooking and baking;
2. Must have great sense of responsibility;
3. Must be willing to work under pressure;
4. Must have pleasing personality;
5. Must be physically fit;
6. Must be hardworking;
7. Must have skills in production process;
8. Must be knowledgeable in making inventory reports;
9. Must be knowledgeable in production and quality standards.
Compensation of the officers and staffs:

Employee Description No. of Monthly Rate Yearly Rate
Workers
General Manager 1 5,000.00 60,000.00
1st Assistant 1 3,000.00 36,000.00
2nd Assistant 1 3,000.00 36,000.00
 Every employee will avail the benefits that the manager will offer as long as they
will perform their job well. They will be having health care and fringe benefits.
PJ Patties Shop 7
Chapter III
Product
PRODUCTS DESCRIPTION
The product is called “Chicken Patties”. It is basically a patty made of chicken as
a special filling inside the crust. The standard size of each patty is 4 inches long, 3 inches
wide and ½ inch thick. It is “C” shaped in appearance with crust at the outside and inside
is cooked curry chicken as filling. The introductory selling price is ₱10 per patty.
Importance of the Product
Chicken meat is one of the most efficient sources of protein for human
consumption.
Packaging, labelling and branding
The crust will be kept intact to maintain its freshness and protect them from the
outside environment. The proponent will use paper pouch intended for the items. And the
product will be wrapped into a thin sheet of compacted paper.
PJ Patties Shop 8
Chapter IV
Market Analysis
Market Definition
The market for Tasty Patties includes all people of different walks of life. All
people who are used to heavy snack or meal and are used to accompanying beverages,
soda or cola to their meal belong to this kind of patrons.
 Specific Target Market
The product is best as heavy meal substitute. A piece of patty is already
equivalent to a heavy meal like lunch or dinner. The crust is a substitute for rice as a
source of carbohydrates. The chicken filling is equivalent for a dish. One needs cold
water or beverage to complete his/her meal.
The specific target market of this product is all those belonging to the community
members are expected to be regular customers. Children’s who go to school are the first
targets.
 CUSTOMER PROFILE
Regular customers of Tasty Patties are those who are able and willing to exchange
their money for a nutritious and delicious food. These customers likewise are seekers of
good nutrition and maintain a healthy and balanced diet. They belong to all genders, and
special targets are also travellers, visitors and tourists.
PJ Patties Shop 9
Competition
Currently, bakeries exist and are located almost at every corner of the community
where people gather and converge. However, sales person at these establishment are just
waiting for customers. Their products, after being manufactured are transferred directly
to the store station and sold until supply last.
In the external environment, the following are the enterprise’ competitors:
1. Restaurants
2. Turo-Turo stores
3. Burger hauz
Demand and Supply
Supply is the amount available for sale or the amount that sellers are willing to
sell at a specified price, and demand, sometimes called effective demand, is the amount
purchasers are willing to buy at a specified price.
Factors Affecting the Market of the Product in terms of demand
The demand for the product may be affected by the following:
1. Increase of habitants at San Jose;
2. Changes (increase or decrease) in customer’s income and purchasing power;
3. Rural and urban development;
4. Price of substitute products.
PJ Patties Shop 10
Factors Affecting the Market of the Product in terms of supply
The supply of the product may be influenced by the following:
1. Development of substitute products;
2. Threat of new entrants with similar or same products;
3. Governments policies;
4. Development and innovation in technology;
5. Sources and cost of production;
6. The dynamic setting of environment.
Risk and Solution
The strengths of the enterprise are the following:
1. It is a sole proprietorship, hence it is easy to manage and operate;
2. Introduction of an entirely new and unique product;
3. The business enterprise has no existing direct competitors that produces and sells
the same product.
In spite of the optimism in the establishment of this enterprise, the business
however, recognizes and accepts the following constraints in its success and prosperity:
1. The enterprise may run short of sufficient capital;
2. The raw materials used in the production may also suffer high inflation rate;
3. Competitors may abound and create strategies better than that of Tastee Patties;
4. The distribution channel may become obsolete in the following years of operation
PJ Patties Shop 11
5. Environmental conditions which the business may not to be able to anticipate;
6. Political and economic crisis in the country both local and national;
7. Technical aspects on the information technology, production and the like.
PJ Patties Shop 12
Chapter V
Marketing Plan
Sales Strategy
At present, where the enterprise is located is a busy community and it is observed
that it is vulnerable to many changes.
Most of the ventures that opened were bakeries, computer shops, canteen, eatery
and sari-sari stores. The canteens and eateries offer cooked food which residents, and
students buy good for a snacks or a heavy meal.
The enterprises will also take an opportunity on the frequent closure of sari-sari
stores located on the community. Such closure will enable the enterprise to cater the
specific market segment such stores.
Distribution Channel
Originally, the channel of distribution for the product is through retailing.
However, the enterprise sought alternative channels to ensure a greater market share. The
alternative channels are:
1. Wholesaling;
2. Personal selling and distribution;
3. Order-taking and distribution.
The alternative channel of distribution the products to the market have a relative
importance in the following sense:
PJ Patties Shop 13
1. It would be easier to distribute the products;
2. It would be easier to penetrate the market;
3. The products could easily be distributed to the market and different distributors
and outlets.
Pricing and Pricing Policy
1pc of chicken patty is ₱15
½ dozen is ₱85
1 dozen is ₱170
 Purchase price of flour (soft wheat flour) is 30 pesos per kilo;
 Purchase price of chicken is 120 pesos per kilo;
 Conversion is 30 pieces of patty per kilo of flour;
 Ratio of chicken to flour is 2:3;
PJ Patties Shop 14
Chapter VI
Production Plan
Production Process
Raw materials will be prepared in accordance to standard set forth by the
proponent. After preparation all ingredients will be mixed and mold into the required
shape and weight. After molding, it will be put into a packaging material individually and
will keep at a freezer for temporary storage.
Machineries and Equipment
Description Quantity Cost Total
Freezer 1 unit 12,000.00 12,000.00

Gas Range 1 unit 3,000.00 3,000.00
LPG 11 kgs. 600.00 600.00

Cooking spoon 1 30.00 30.00
Regular Kitchen
Knife 1 20.00 20.00
Chopping Knife 1 20.00 20.00

Chopping Board 1 50.00 50.00
Kitchen Knife 1 20.00 20.00
Kitchen Scale 1 400.00 400.00
Kitchen Trays 3 50.00 150.00
TOTAL P16,290.00
Furniture and Fixtures
Description Quantity/Unit(s) Price Total
PJ Patties Shop 15
Table 1 1,000.00 1,000.00

Monoblock Chair 6 120.00 720.00
Displaying Cabinet 1 1,000.00 1,000.00
Total 2,720.00
PLANT LAYOUT
DOOR
GENERAL
MANAGER
PJ Patties Shop 16
C. R
DISPLAYING AREA OF PATTIES
PLANT LOCATION
PJ Patties Residential
Shop
Vulcanizing Residential
PJ Patties Shop Shop 17
To Datag
Waiting Sari-Sari
Shed Store
(closed)
To Legazpi To Tabaco
Production Schedule
The production of patties will on daily basis. The shop will be open from 7:00
A.M. to 7:00 P.M.
Costing and Costing Method
Machineries and Equipment
Description Quantity Cost Total
Freezer 1 unit 12,000.00 12,000.00

Gas Range 1 unit 3,000.00 3,000.00
LPG 11 kgs. 600.00 600.00
PJ Patties Shop 18
Cooking spoon 1 30.00 30.00

Regular Kitchen
Knife 1 20.00 20.00
Chopping Knife 1 20.00 20.00

Chopping Board 1 50.00 50.00
Kitchen Knife 1 20.00 20.00
Kitchen Scale 1 400.00 400.00
Kitchen Trays 3 50.00 150.00
TOTAL P16,290.00
Depreciation (Machineries and Equipment)
= 16,290.00
= 3,258.00
Furniture and Fixtures
Description Quantity/Unit(s) Price Total

Table 1 1,000.00 1,000.00
Monoblock Chair 6 120.00 720.00
Displaying Cabinet 1 1,000.00 1,000.00
Total 2,720.00
Depreciation (Furniture and Fixtures)
= 2,720.00
= 544.00
Permit and licences
PJ Patties Shop 19
Description Annually
Business Permit 1,000.00
DTI Permit 500.00
BIR Permit 300.00
Barangay clearance 100.00
Mayor’s Permit 500.00
Total 2,400.00
Salary Expense
Position Number of Employee Monthly Salary Annual Salary
Manager 1 4,000.00 48,000.00
First Assistant 1 2,000.00 24,000.00
Second Assistant 1 2,000.00 24,000.00
TOTAL P8,000.00 P 96,000.00
Advertising and Promotion
Kinds of Quantity Cost Annual

Advertisement
Flyers 1 box (1000pcs) 500.00 500.00
Tarpaulin 2 250.00 500.00
1,000.00
Utility Expense
Description Monthly Annual

Electric Bill 800.00 9,600.00
Water bill 200.00 2,400.00
P1,000.00 12,000.00
PJ Patties Shop 20
Rent Expense
Description Monthly Annual

Rent (Building) 2,000.00 24,000.00
TOTAL 24,000.00
Employee Benefits Expense
Staff/Officers Salary SSS Philhealth Pag-ibig Monthly annual
Manager 4,000.00 150.00 50.00 50.00 250.00 3,000.00

First Assistant 2,000.00 100.00 50.00 50.00 200.00 2,400.00
Second Assistant 2,000.00 100.00 50.00 50.00 200.00 2,400.00
TOTAL 250.00 150.00 150.00 650.00 7,800.00
Chapter VII
FINANCIAL PLAN
PJ Patties Shop 21
Major Assumption
1. Production Data
 Purchase price of flour (soft wheat flour) is 30 pesos per kilo;
 Purchase price of chicken is 120 pesos per kilo;
 Conversion is 30 pieces of patty per kilo of flour;
 Ratio of chicken to flour is 2:3;
 Packaging cost is estimated at 1 peso per piece of the finished product;
 Other ingredient cost is 1000 pesos per month;
 Selling price is 10 pesos per piece;
 Target sales volume for the first year is 36,000 pieces and will increase on the
following years of operation.
OPERATING EXPENSES
 Advertising and promotion expense is 1,000 per month;
 Salaries expense include payment for the service of general manager, first
assistant and second assistant;
 Utility expense (light and water) is estimated 1,500 per month;
 Ingredients and indirect materials is estimated 1,000 per month
UNIT PRODUCTION COST
Description Unit Cost Daily Monthly Annually

Chicken Patty P10.00/piece 100 1,000.00 3,000 30,000.00 36,000 360,000.00
INITIAL WORKING CAPITAL REQUIREMENTS
A. Equipment and Materials
PJ Patties Shop 22
Equipment/Materials Quantity Total cost
Freezer 1 unit
15,000.00
Gas Range 1 unit 3000.00
LPG 11 kgs 600.00
Cooking spoon 1 pc 30.00
Regular Kitchen Knife 1 pc 20.00
Chopping Knife 1 pc 20.00
Chopping Board 1 pc 50.00
Kitchen Knife 1 pc 20.00
Kitchen Scale 1 pc 400.00
Kitchen Trays 3 pc 150.00
Total 19,290.00
B. Cost of Production and Operation (1 month)
Flour (90 kls @ 30 per kilo) 2,700.00
Chicken (60 kls @ 120 per kilo) 7,200.00
Packaging Materials 2,700.00
LPG 1,200.00
Ingredients and Indirect Materials 1,000.00
Total 13,900.00
TOTAL PROJECTED COST
PJ Patties Shop 23
A.FIXED ASSET
Machineries and Equipment 16,290.00
Furniture and Fixtures 2,720.00
B.OPERATING EXPENSE
Raw materials 13,900.00
Rent Expense 2,000.00
Salary Expense 8,000.00
Benefits Expense 650.00
Advertising and Promotion 1,000.00
Utility Expense 1,000.00
Permit and Licenses 2,400.00
P 47,960.00
C. CONTINGENCY ALLOWANCE (10%) 4,796.00
TOTAL P 52,756.00
PJ Patties Shop
Projected Income Statement
PJ Patties Shop 24
For the year ended, December 31, 2013
Sales (Net) 360,000.00
Less: Operating Expenses
Raw Materials 166,800.00
Advertising and Promotions 1,000.00
Utilities 12,000.00
Salaries 96,000.00
Benefit Expense 7,800.00
Permit & Licenses 2,400.00
Add: Contingency 10% 4,796.00
Depreciation - Machineries & Equip 3,258.00
Furniture & Fixtures 544.00 318,598.00
Net Income before Tax 41,402.00
Less: Income Tax (12%) 4,968.24
Net Income after Tax ₱36,433.76
PJ Patties Shop
Projected Cash Flow Statement
PJ Patties Shop 25
For the year ended, December 31, 2013
Cash Inflow
Capital 47,960.00
Sales 360,000.00
Total ₱407,960.00
Cash Outflow
Raw Materials 166,800.00
Advertising and Promotions 1,000.00
Utilities 12,000.00
Salaries 96,000.00
Benefit Expense 7,800.00
Permit & Licenses 2,400.00
Contingency 4,796.00
Total ₱333,806.00
Cash Balance, End ₱74,154.00
PJ Patties Shop
PJ Patties Shop 26
Projected Balance Sheet

December 31, 2013
Assets
Current Assets
Cash 74,154.00
Less: Depreciation (3,802)
Total Assets ₱89,362.00
Liabilities and Owner’s Equity

Capital 47,960.00
Tax Payable 4,968.24
Net Income 36,433.76
Total Liabilities and Capital ₱89,362.00
Exit/Payback Strategy
PJ Patties Shop 27
ROI = Net Income x 100%

Capital
= 36,433.76 x 100%
47,960.00
= .76 x 100%
= 76%
PAYBACK PERIOD = Capital

Net Income
= 47,960.00
36,433.76
= 1.31 X 12
= 1 year and 4 months
Chapter VIII
PJ Patties Shop 28
Conclusion
The proponent concluded that the proposed business is feasible and viable as
shown in the financial statements. With a capital investment of 47,960.00 and a net
income of 36,433.76 it will be recouped within 1 year and 4 months at 76 % ROI.
PJ Patties Shop 29

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PJ Patties Shop: A Feasibility Study

is a sole proprietorship form of business organization. Owned and managed by the

start its operations at downtown of San Jose, Malilipot, Albay.

The enterprise will be a small-scale business enterprise which will provide a

achieve the goals and objectives of the business.

 To excel in sales and distribution of chicken patties using a carefully devised

marketing program towards local competitiveness.

 To provide a lower cost and palatable tastes of patties new products.

 To provide a nutritious supplement for any other foods.

PJ Patties Shop is a legal venture committed to become well-known suppliers all

proper management for a good welfare.

maintain market sustainability in order to meet competitive challenge and overcome

Name, Nature and location of the business.

Name of the business: PJ Patties Shop

Nature of the business: Dealer (wholesaling and retailing)

Location: Zone #5, Datag, San Jose, Malilipot, Albay

PJ Patties Shop is own and manage by __________________the owner and

general manager of the business.

Legal Business Description: Sole Proprietorship

i. Form of business organization:

either shortages or surplus of the capital.

ii. Licensing and other requirements for setting up the business

the business legal and they are the following:

authority from the manager to her assistants:

1st Assistant 2nd Assistant

Lists of officers and staffs:

 General Manager (owner) –

Job Description and Specification

in the operation of the business:

A. OWNER and GENERAL MANAGER

2. Primarily responsible in the financial aspects of the enterprise;

5. Washes the kitchen utensils used before leaving the workplace;

6. Keeps an inventory of finished products on a daily basis;

7. Assists in the sale of finished products.

Below is the statement of the qualifications and traits in terms of skills,

experience, trainings required in the effective performance of each task.

A. OWNER AND GENERAL MANAGER

1. Knowledgeable in the operation and management of a sole proprietorship

2. Must have an excellent sales talk ability;

3. Must be confident and optimistic;

4. Must know basic accounting and bookkeeping;

5. A graduate of business related courses;

6. At least 18-35 years old.

2. Must be willing to work under pressure;

3. Must be flexible at all times;

4. Must have knowledge in making simple reports;

5. Must know how to communicate in English and the local dialect;

6. Must be physically fit;

7. Must have pleasing personality;

8. Must have knowledge in inventory reporting;

9. Must be a graduate of any business course;

10. Can adapt to quality standard.

1. Must have special skills in cooking and baking;

2. Must have great sense of responsibility;

3. Must be willing to work under pressure;

4. Must have pleasing personality;

5. Must be physically fit;

7. Must have skills in production process;

8. Must be knowledgeable in making inventory reports;