Feasibility Chicken Patties

8/13/2019 Feasibility Chicken Patties

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PJ Patties Shop: A Feasibility Study

PJ Patties Shop 1

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 devisedmarketing 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.


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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.


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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 businessIn 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:


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1. Barangay Clearance2. Mayors 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

1stAssistant 2nd

Assistant


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Lists of officers and staffs:

General Manager (owner) 1stAssistant- 2ndAssistant-

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.


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PERSONAL REQUIREMENTS

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 MANAGER1. 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.


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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 inch thick. It is C shaped in appearance w ith 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.


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PJ Patties Shop 9

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 MarketThe 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. Childrens who go to school are the first

targets.

CUSTOMER PROFILERegular 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.


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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. Restaurants2.

Turo-Turo stores

3. Burger hauzDemand 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 customers income and purchasing power;3. Rural and urban development;4. Price of substitute products.


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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


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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.


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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:


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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

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;


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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 KitchenKnife 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


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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


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PLANT LAYOUT

C. R

DOOR

DISPLAYING AREA OF PATTIES

GENERAL

MANAGER


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PLANT LOCATION

To Datag

To Legazpi To Tabaco

Waiting

Shed

Vulcanizing

Shop

PJ Patties

Shop

Sari-Sari

Store

(closed)

Residential

Residential


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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

Cooking spoon 1 30.00 30.00

Regular KitchenKnife 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

5

= 3,258.00


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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

5

= 544.00

Permit and licences

Description Annually

Business Permit 1,000.00

DTI Permit 500.00

BIR Permit 300.00

Barangay clearance 100.00

Mayors Permit 500.00

Total 2,400.00


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PJ Patties Shop 21

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

Advertisement

Quantity Cost Annual

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


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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


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Chapter VII

FINANCIAL PLAN

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


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INITIAL WORKING CAPITAL REQUIREMENTS

A. Equipment and MaterialsEquipment/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


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TOTAL PROJECTED COST

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


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PJ Patties Shop

Projected Income Statement

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


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PJ Patties Shop

Projected Cash Flow Statement

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


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PJ Patties Shop

Projected Balance Sheet

December 31, 2013

Assets

Current Assets

Cash 74,154.00



Less: Depreciation (3,802)

Total Assets 89,362.00

Liabilities and Owners Equity

Capital 47,960.00

Tax Payable 4,968.24

Net Income 36,433.76

Total Liabilities and Capital 89,362.00


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Exit/Payback Strategy

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


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Chapter VIII

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.

Feasibility Chicken Patties

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