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FILAMER CHRISTIAN UNIVERSITY

Roxas City, Capiz

A BUSINESS PLAN

In partial fulfillment
of the requirements in
ENTREPRENEURIAL MIND (GE 11)

DENNIS O. ASURQUIN
Instructor

ELMER F. FUNA
JAJIE D. DUMAPIT
BS Criminology 2-B
ENTREPRENEURIAL MIND (GE 11) - A Business Plan
STATEMENT OF PURPOSE

REMLE’s Motorcycle Shop will offer quality services and motorcycle parts to a growing
market of motorcycling fanatics. The shop offers excellent value of services on repairs and
maintenance of the different motorbikes that will not bust the customer’s budget. Quality
motorcycle parts will be available at affordable price that will not affect the repairs and
modifications.

For the past few years, motorcycling has developed an entirely new customer among young
men, ages 18 to 28. In the last five months of this year, motorcycle sales for this age group was
twice that of young adults, ages 30 to 45. Repairs, maintenance and modifications were among
services that has brought 10% growth on sales of Motorcycle Shops.

Dumalag is a town where most of the transportation means of its population are
motorcycles along with its nearby town in Capiz. The Town has 5 motorcycle organizations and
sponsors an annual cycling event as part of the Town’s Annual Fiesta Celebration.

Elmer F. Funa in partnership with Jajie D. Dumapit, owners of REMLE’s Motorcycle Shop
are one of the most experienced and best known motorcyclists in Dumalag. Thay are affiliated
to a famous Region VI Motorcycle Organizations with over 500 members in Dumalag and has 8
Chapters in the whole region. Their connection with the motorcycling community and the
growing demand for quality motorcycle services and motorcycle parts will make REMLE’s
Motorcycle Shop the most popular shop in Dumalag.

MISSION STATEMENT

The mission of REMLE’s Motorcycle Shop is to provide quality services on repairs,


maintenance and modifications of Motorcycles and to become the primary resource of
Motorcycle parts in Dumalag.

VISION STATEMENT

A premier Motorcycle Shop delivering quality motorcycle services and motorcycle parts
committed to its valued customers.

ELMER F. FUNA
JAJIE D. DUMAPIT
BS Criminology - 2B
ENTREPRENEURIAL MIND (GE 11) - A Business Plan
TABLE OF CONTENTS

1. Cover Sheet

2. Statement of Purpose

3. Table of Contents

I. The Business

A. Description of Business

B. Marketing

C. Competition & Industry Trends

D. Operating Procedures

E. Business Structure & Management Personnel

F. Business Insurance

G. Plans for Growth/Expansion and Exit Strategy

II. Financial Data

A. Loan Applications
B. Capital Equipment And Supply List
C. Balance Sheet
D. Breakeven Analysis
E. Pro-Forma Income Projections (Profit and Loss Statement)
1. Income Statement Projections
2. Projected Cash Flow
3. Important Assumptions

ELMER F. FUNA
JAJIE D. DUMAPIT
BS Criminology - 2B
ENTREPRENEURIAL MIND (GE 11) - A Business Plan

REMLE’s MOTORCYCLE SHOP

A. DESCRIPTION OF BUSINESS
REMLE’s Motorcycle Shop will offer quality services such as repairs, maintenance and
modifications. Quality motorcycle parts will be made available to its valued customers at
affordable prices. Unlike any other motorcycle shops, there will be a membership package that
will give discounts among its customers. Free services such as visual check-up and analysis of
the possible repairs would be the best practice of a customer-friendly shop that the REMLE’s
Motorcycle Shop is committed to.

SERVICES
1. Repair - A motorcycle mechanic will conduct initial inspection to determine what needs
to be repaired and give recommendation of services that the shop can offer.
2. Maintenance - The shop will set standard operating procedures and further guidelines
for the inspection and maintenance of motorcycles to be conducted by a well-trained
and qualified service mechanic.
3. Modifications - Recommend appropriate modification of motorcycles guided by the
existing rules and regulations of the Land Transportation and Franchise Regulatory
Board (LTFRB).

PRODUCTS
These quality products include Engine Parts, Handle Accessories, Handlebars, Grips,
Electrical & Electronics, Lightings, Horns, Frames & Fittings, Crash Protection, motor oil,
Windshield, Foot Pegs, Protective Gears, Helmets, Professional Body Wear, Bags & Carriage
Frames, Exhaust System, bolts and nuts, Seat Covers, wheels and breaks, security systems,
etc.

B. MARKETING

Target Market
REMLE’s Motorcycle Shop primary target market consists of students and young
professionals of the Municipality of Dumalag and nearby towns. This segment is made of
18-28 year old that are active and participate regularly in outdoor activities. As the town is
relatively confined, with few people driving, most all students and young professional walk
or ride motorcycle to and from class. A secondary market consists of the rest of the
population of Dumalag. This area is well known for its Motocross trails, river paths,
greenbelts and road motorcycle groups.

ELMER F. FUNA
JAJIE D. DUMAPIT
BS Criminology - 2B
ENTREPRENEURIAL MIND (GE 11) - A Business Plan

Market Size
The Municipality of Dumalag has approximately 29,466 population. In addition to this
town, there is a TESDA Center that the shop can cater to. There is an estimated 15%
turnover among the student population yearly, as new students enroll.

REMLE’s Motorcycle Shop serves a population of nearly 30,000 people. With only three
other bike shops in this area, REMLE’s Motorcycle Shop will be able to capture a large
amount of the market share due to its unique location and exclusive customer-friendly
services.

Market Trends
The motorcycle market is always evolving. The latest trend is the growing demand for
transportation which can avoid heavy traffics in urban areas and more convenient to travel
in remote areas, both of which have relatively high margins. In addition, with transportation
fare hikes, more people have chosen motorcycles for commuting to work and school. This
has caused an increase in demand for motorcycles and accessories, where markups are
often 20% or greater. Service sales have also increased as more people are tuning up old
motorbikes and regularly maintaining their new ones.

SWOT Analysis

Strengths: Location near campus of TESDA Center; Saint Martin Academy, Public
Market, Certified Mechanics and Low Lease Rates

Weaknesses: Most of the target market returns home during the summer, making
summer months less busy; new in the marketplace

Opportunities: Lack of competition with certain brands will allow higher margins; group
rides, events and races will attract new customers; 3 establishments in area provide large
and ever-changing market

Threats: Competing motorcycle shops already have established customer bases;


trends may shift away from bicycling if gas prices increase; weather (too hot or rainy)
causes fewer people to ride.

ELMER F. FUNA
JAJIE D. DUMAPIT
BS Criminology - 2B
ENTREPRENEURIAL MIND (GE 11) - A Business Plan

C. COMPETITION & INDUSTRY TRENDS

Increasing manufacturing and sales of a motorcycle across the globe is projected to


augment the demand for motorcycle accessories over the forecast period. In addition, the
increasing popularity of motorcycle among youths is one of the major factor expected to drive
growth of the demand for motorcycle accessories. In addition, the development of cost-effective
combustible engines coupled with increasing leisure activities such as bike stunts, racing, and
off-road activities are some factors expected to boost overall sales of motorcycle accessories
worldwide. Moreover, stringent rules and regulations regarding carbon emission reduction,
government mandates, and the introduction of new BS-IV engines with Selective Catalytic
Reduction (SCR) and Exhaust Gas Recirculation (EGR) technologies, which is expected to
enhance the sales of motorcycles and directly propel the demand for motorcycle accessories.

The rising number of female riders driving growth of motorcycle accessories market.
According to the latest estimate, almost one out of five motorcyclists in the country is female,
rising almost 10% in the past decade.

The recent trend observed in the target market is the development of Head-Up Display
(HUD) technology (HUD) in motorcycle helmets. For instance, NUVIZ is the fully integrated
HUD helmet technology that displays customizable information intended to be used in all
conditions, including riding in the rain. Moreover, manufacturers are focusing to develop
product and technology is expected to showcase a promising growth for the motorcycle
accessories market.

D. OPERATING PROCEDURES

Operations of REMLE’s Motorcycle Shop will be led by Elmer F. Funa. He will oversee daily
transactions, as well as inventory levels, marketing, bulk sales and other miscellaneous duties.
The remainder of the staff, which will be adequately trained in product knowledge and sales, will
be responsible for ensuring customer satisfaction and achieving sales goals. Qualified and
competent motorcycle mechanics diagnose, adjust, repair, or overhaul motorcycles, scooters,
mopeds, dirt bikes, or similar motorized vehicles. The store will be opened daily from 9am until
5pm, with a reduction in hours during non-school sessions.

ELMER F. FUNA
JAJIE D. DUMAPIT
BS Criminology - 2B
ENTREPRENEURIAL MIND (GE 11) - A Business Plan

E. MANAGEMENT PERSONNEL

Management Team
REMLE’s Motorcycle Shop is managed by its owner, Elmer F. Funa. Elmer is a lifelong
motorcyclist enthusiast with many years of experience riding and working on motorcycles.
He spent much of his teenage years working in a motorcycle shop in his hometown, where
he gained many contacts and inside knowledge of the motorcycle shop industry.

Personnel Needs
Along with Elmer, REMLE’s Motorcycle Shop will employ two full-time certified
mechanics. These mechanics will provide all repair and service work that comes through
the shop. Three to five part-time sales people will be hired to assist customers and ring up
purchases. The staff will adjust in size and hours to meet the seasonal demand. The
part-time staff will likely be TESDA students who are looking on-the-job training and to
supplement their income by working at the shop.

Advisers
The company receives advice from various friends and business professionals. These
include a CPA for financial and accounting matters, as well as an attorney for any legal
requirements, such as liability waiver forms for events. In addition, Elmer consults with
some of his business-minded friends and affiliations.

F. BUSINESS INSURANCE

A Business Owner’s Policy is a good foundation for business insurance. This policy
combines the three types of insurance necessary for businesses, including:
General liability insurance to help protect your business from liability claims. This can
include:
 Accidents resulting in bodily injury
 Damage to someone else’s property caused by your business
 Personal and advertising injury claims
Commercial property insurance to help cover damages to your business’ equipment,
furniture and property. This coverage helps restore your property back to its original
condition and applies whether you own or lease your property.
Business income insurance, also known as business interruption insurance, to help
replace lost income if your business shuts down from damage.

ELMER F. FUNA
JAJIE D. DUMAPIT
BS Criminology - 2B
ENTREPRENEURIAL MIND (GE 11) - A Business Plan

FINANCIAL DATA

A. LOAN APPLICATIONS
In order for REMLE’s Motorcycle Shop to successfully open with the required inventory
and staff, the company will need Php 200,000 in capital. Elmer Funa has invested 50,000 of
personal money into the company, plus many of the required tools and equipment. The
remainder of the funding will come in the form of an Savings Bank Account Loan, originated
from a local bank.

B. CAPITAL EQUIPMENT AND SUPPLY LIST


The startup capital will be used to fund several expenses, including building renovation
and fixtures. Elmer will purchase an adequate amount of inventory, including engine parts,
accessories and apparel. A portion of the funds will be used for a grand opening marketing
campaign, including building an e-commerce website or social media advertisements.

These startup costs will account for Php 115,000 of the initial capital. The remaining
cash will be used for working capital for wages, rent, utilities and operational costs for the
first year of business.

C. BALANCE SHEET
REMLE’s Motorcycle Shop balance sheet will show total assets of approximately
200,000, including cash, inventory, equipment and leasehold improvements. Liabilities will be
150,000, plus any bank lines of credit. In the event that suppliers extend credit to the business,
the balance sheet will reflect an increase in inventory and an equal adjustment to liabilities.

D. BREAKEVEN ANALYSIS
With fixed monthly expenses equaling 25,000, and a combined average margin of 62%,
the business will break even at approximately 40,000 per month in revenues. This will be
achieved on a monthly basis before the end of year one.

ELMER F. FUNA
JAJIE D. DUMAPIT
BS Criminology - 2B
ENTREPRENEURIAL MIND (GE 11) - A Business Plan

E. PRO-FORMA INCOME PROJECTIONS (Profit and Loss Statement)

INCOME STATEMENT PROJECTIONS


First year sales are projected to be 500,000 accounting for 125,000 in revenues. Service
sales will account for 175,000 in income. Parts, accessories and apparel will generate the
remaining revenues. Gross margin on bicycle sales will average 30%, while parts, accessories
and apparel will be sold at a 50% margin. First year losses are expected to be 25,000. In Year 2,
revenues will grow to 600,000 with profits of 55,000. Year 3 will see revenues of 750,000 and
profits of 90,000.

PROJECTED CASH FLOW


REMLE’s Motorcycle Shop strongest months will be August through December and March
through May. These months will be cash flow positive and will carry the company through the
slower months. REMLE’s Motorcycle Shop will end Year 1 with approximately 60,000 in the
bank.

IMPORTANT ASSUMPTIONS
TESDA enrollment remains the same even during this pandemic and on going restrictions
brought about by COVID-19. The surrounding establishments continue to cooperate with
marketing initiatives and events promoting REMLE’s Motorcycle Shop. The biking industry
continues to grow or remains steady.

ELMER F. FUNA
JAJIE D. DUMAPIT
BS Criminology - 2B

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