Business Plan

Entrepreneurial Business Plan

Entrepreneurial Business Plan2015Rachelle Anne M. PalecpecPWU - MBA3/28/2015

I. IntroductionA hamburger (also called a beef burger, hamburger sandwich, burger or hamburg) is a sandwich which is made up of of one or more cooked patties of ground meat in which is usually beef, placed inside a sliced bun. Hamburgers are often served with lettuce, bacon, tomato, onion, pickles, cheese and condiments such as mustard, mayonnaise, ketchup, relish, and green chile.The term "burger" can also be applied to the meat patty on its own, especially in the UK where the term "patty" is rarely used. For the brief history of burger, there have been many claims about the starting point of the hamburger. The first acknowledged report in a newspaper is from July 5, 1896, when theChicago Daily Tribunemade highly specific claim about a "hamburger sandwich" in a commentary about a "Sandwich Car:" "A well-known favorite, only five cents, is Hamburger steak sandwich, the meat for which is kept prepared in small patties and 'cooked while you wait' on the gasoline choice." According to CongresswomanRosa DeLauro, the hamburger, a ground meat patty sandwiched between two slices of bread, was first produced in America in 1900 by Louis Lassen, aDanishimmigrant, owner ofLouis' LunchinNew Haven, Connecticut.There have been adversary claims by Charlie Nagreen, Frank and Charles Menches, Oscar Weber Bilby, and Fletcher David. White Castletraces the foundation of the hamburger to Hamburg, Germany with its invention by Otto Kuase.However, it achieved national recognition at the1904 St. Louis World's Fairwhen theNew York Tribunereferred to the hamburger as "the innovation of a food vendor on the pike." No certain argument has ever ended the dispute over invention. A piece of writing from ABC News sums up: "One dilemma is that there is modest written history. Another concern is that the spread of the burger happened largely at the World's Fair, from little vendors that came and went in an instant. It is entirely likely that more than one person came up with the proposal at the same time in different parts of the country." II. Executive SummaryBanana Habit is a locally owned fast food restaurant which offers wide variety of Filipino cuisines and desserts while its specialty is Banana Burger. The said fast food will be positioned in Tagaytay City, Cavite. Tagaytay City's name has two origins. The first is rooted in an ancient folk tale where a father and son were hunting for wild boar when their quarry suddenly turned around and attacked them. The boy shouted to his father"Taga itay! Taga itay!"(Hack it father, hack it!) The boy's shouts echoed to the countryside and became a favorite tale of the locals and in the course of time, the place came to be known as "Tagaytay". The second was recounted by Gen. Emilio Aguinaldo himself in his Memoirs. A local "kainginero" was asked by Spaniard,"Como se llama este sitio?"(How is this place called?), They did not, however, understand each other because of language barrier. The locals son, getting impatient, cried out,"Taga itay! Taga itay!"and the Spaniard replied "Ahh, Tagaytay!". Our Revolutionaries heavily used Tagaytay as a connectin linkand secret passageway between Cavite and Batangas during the Philippine Revolution. Gen. Emilio Aguinaldo and his army, in fact, captured the entire 72nd Battallion of the Spanish colonial army after passing through Tagaytay en route to Talisay, Batangas. Tagaytay's strategic location was punctuated even more the 11th Airborne Division of the U.S. Army airdropped military back-up of the Ridge, and from there launched massive northward drive to Manila, culminating in the liberation of Manila from the Japanese on February 3, 1943. Tagaytay became a chartered city by virtue of Commonwealth Act No. 338 creating Tagaytay City, the city charter has been amended thrice: first, by Commonwealth Act No. 397 approved on September 6, 1938; second, under Republic Act No. 3622 of June 22, 1963; and third, by Republic Act No. 4438 of June 19, 1965.Tagaytay City is one of the vital tourist sites, which play a very significant role in the countrys tourism industry. From the National and Regional points of view, Tagaytay City ranks very high in tourism potentials due to its scenic attraction and available accommodation facilities that meet international standards. Because it is very accessible and strategically near Metro Manila, which is the main entry and exit point of the countrys local and international travellers, Tagaytay remains one of the leading tourist areas in the country. The main tourist attraction of Tagaytay is the captivating panoramic view of the natural beauty of the Taal Volcano, which is the smallest volcano in the world and where two delectable rare species of fish, the maliputo and tawilis are found. In spite of its nearness to Metro Manila, Tagaytay has a unique rustic atmosphere and invigorating cool climate. This is the reason why people do not only want to visit the place but prefer to hold seminars / conferences the city. Complementing the natural endowment are several tourist establishments, which are attractions themselves.Banana Habit was only a research proposal submitted as a course requirement way back in 2013 and today, the founder decided to make the proposal a reality. The founder kept in touch with her old friends in college to offer partnership that could help in putting up the business most especially in the financial aspect. Banana Habit will be attracting new clients through a combination of networking and monthly public promotion that introduces otherwise unreachable segments of the population. It is a sole proprietorship that will accomplish profitability by month eight and will have modest profits by the end of year three. This plan is created to obtain a location for the initial launch of this concept. The financing, in addition to the capital contributions from shareholders, will allow Banana Habit to successfully open and expand through year two. The initial capital investment will allow Banana Habit to provide its customers with a value-driven, entertaining experience through the creativity of its management.

III. Component The management of Banana Habit has a mission of providing a wide range of Filipino food in affordable prices as its main tactic to attract and maintain customers. Going extra mile or beyond the customers expectations is also one target of Banana Habit. The objectives for the first three years of operation include:a. To create a fast food restaurant whose primary goal is to exceed customer's expectations.b. To increase the number of customers served by at least 20% per year through advanced performance and word-of-mouth referrals.c. To develop a sustainable fast food restaurant that generates value for their customers. The founder is Rachelle Anne M. Palecpec, year 2013 graduate of BS in Business Administration from De La Salle University who is currently taking up Masters in Business Administration in Philippine Womens University. The founder is Workforce Reports Analyst in TeleTech, an international Business Processing Outsourcing company which is one of the largest and highest paid contact center worldwide. Rachelle manages Banana Habit as a whole and analyzes each aspect that may affect the business. Rachelle built the team and motivates them to become more passionate and involved with Banana Habit.

Rachelle Anne PalecpecFounder & CEOKenneth AsiaChief Operating OfficerFatima NazarenoHead, OperationsJera RamosHead, FacilitiesRoelene BulilanHead, AccountingRuby GarcesHead, Food & BeverageRuth PoloanHead, Human ResourceQuerolyn BallesterosHead, MarketingBelow is the organizational chart of Banana Habit fast food.

Kenneth Asia is the Chief Operating Officer of Banana Habit who is a Licensed Electronics Engineer and has various work experience in Engineering field. Kenneth is currently working in TeleTech as Workforce Scheduling Officer. He is responsible mostly in Operations including the intra-day and daily routine and task of Banana Habit. Ruth Poloan is the head of Human Resource Department. Ruth acts as a lead person in the delivery of human resource services with particular duty for providing information to the employees concerning policies and regulations, addressing a range of concerns and/or providing general support, supervising the maintenance of records, files and databases of personnel actions, evaluations, licensure, and tenure and assisting the CEO and COO in ensuring that personnel functions conform to all appropriate regulatory requirements. Roelene Bulilan is the Accounting Head who establishes financial status by developing and implementing systems for collecting, analyzing, verifying, and reporting financial information. Roelene achieves accounting operational objectives by contributing accounting information and recommendations to strategic plans and reviews. Fatima Nazareno as the Operations Head will lead and supervise the restaurant team for all aspects of day-to-day running of stores as well as sales, customer service, quality control, operations and provide effective line-management. Fatima will be responsible for the attainment of their stores targets for all lines of business, planning, organizing, directing and coordinating with the suppliers of resources of the restaurant for the efficient and profitable services of food and beverages.Ruby Garces is always present in the restaurant and works with the team to take orders, set, serve and clear tables and deal with the exchange of bills and money. Ruby is an important member of the team. She will have a contact with the customer during their dining experience, it is necessary that Ruby is polite and courteous when welcoming customers into the restaurant, during the service of the meal and answer queries or complaints from customers. Ruby leads the team to ensure they provide polite and efficient service at all times to maintain the exceptional standard of service and quality.Querolyn Ballesteros acts as Marketing head who works on the demand that Banana Habit will face and its competitors plus to spot potential customers. Querolyn needs to widen pricing strategies with the purpose of maximizing the firm's profits or share of the market while ensuring the customers are pleased and fulfilled. Moreover, Querolyn needs to oversee product development or monitor trends that specify the need for new products and services. Jera Ramos is the head of Facilties who maintains the buildings and grounds of Banana Habit, directing staff and overseeing the upkeep of equipment and supplies. Jera needs to make sure the buildings and grounds are maintained, which entails daily and weekly cleaning schedules as well as determining and schedulingrepairs, renovation projects, waste reduction improvements and safety inspections. Jera is in charge of a budget and must negotiate with outside vendors for supplies, repairs and other measures. IV. Market Feasibility Banana Habit location will range in size from 50 70 meter square and will seat from15 25 guests. The first location will be on the larger end of this range. The location will feature its own originality in selling burgers and other brand building attributes. Banana Habit will equip the outlet with modern furniture andaim forcleanlinessand anopen feeling. The space selection will be chosen based upon the following criteria: Community size: minimum of 300,000 people within a radius of 8 kilometers. Tourist destination. Easy access. Large percentageof teenagers in the community.All of these qualities are consistent with Banana Habits goal of providing a top quality fast food experience. Banana Habit wants "word-of-mouth" to be their best form of marketing, where customers value their brand as something exciting and cannot wait to tell their friends and neighbors.Banana Habit will directly compete with several fast food joints along the main road in Tagaytay with tourist spots nearby,including Mang Inasal, Jollibee, McDonalds, Greenwich and more. See the picture below for the proposed logo of Banana Habit.

Heres the tarpaulin to be posted along roads:

Banana Habit offers affordable Filipino cuisines in affordable prices. See proposed menu below:

Banana Burger - the specialty of Banana Habit which is Php 75.00 each.

Below is the floor plan for the physical appearance of Banana Habit.

Marketing StrategiesWith a marketing distribution strategy formed, Banana Habit will develop a promotion plan. The promotion strategy in its most basic form is the controlled distribution of communication designed to sell their food. In order to accomplish this, the promotion strategy encompasses every marketing tool utilized in the communication effort. This includes: Advertising.Banana Habit uses a tagline Make it a Banana Habit. Banana Habit will post tarpaulins and banners from Bacoor, Cavite along Aguinaldo Highway on the way to Tagaytay City, Cavite. Directions will be posted as well. Packaging.Banana Habit will use native and unique style of packaging designed by the management out of their creative minds. Public relations.Banana Habit will sponsor different events in Cavite which is a good way to introduce the business to the public. Sales promotions.Discount vouchers can be purchased online which is one of the easiest ways to catch the attention of potential customers. Of course, Banana Habit will use social media. Personal sales.Banana Habit believes that every customer is a treasure. Banana Habit will make sure that each customer will become a Banana Habit advocate. Demand and Supply Chain ManagementOrdering stock is a very important factor that needs careful attention from the management as it involves the arrival and delivery of the raw materials for the food preparation. Congestion with the stocks will pull the business down that may lead to net loss. Moreover, raw materials are perishable so it would be best to plan the ordering of stocks in order to serve the food fresh. The CEO and COO are specialized in Capacity Planning and Process Improvement thats why it is easy for them to analyze and plan in both short-term and long-term basis. They are excellent in using different planning tools and basically, MS Excel. Below is the sample computation for ordering stock using MS Excel.Ordering Stock

This is an example of a spreadsheet to calculate the best time interval to order stock.

Scenario

Storage fits certain amount of raw materials and stocks.

Banana Habit orders stocks on a regular basis.

Each time an order is made for new stock, there is a fixed administrative cost.

Stocks are kept in stock until needed.

Keeping the stock incurs a cost due to capital tied up and warehouse costs.

The supplier of the stocks gives a discount on large orders.

Objective

Find the time interval to order stock which will result in the lowest Admin and Warehouse costs.

Input Data

Cost of a single stock order : Php75

Cost of keeping stocks in warehouse. (As a % of the stock value) : 12%

Quantity of stocks used per day : 10

Admin cost each time new stocks are ordered : Php25

Average quantity of stocks (As % of ordered quantity) : 0.5

Ordering Intervals to evaluate. (Expressed in Days) : 2

Suppliers first Price Break and Discount% offered : 2001%

Suppliers second Price Break and Discount% offered : 7505%

Output

Ordering IntervalIn DaysQuantityPerOrderOrderValueOrderDiscountOrdersPer YearAnnual Admin CostAnnualWarehouseCostsAnnualTotalThe BestOrderingInterval

110 Php 750 Php - 365 Php 9,125 Php 45 Php 9,170 -

220 Php 1,500 Php - 183 Php 4,575 Php 90 Php 4,665 -

440 Php 3,000 Php - 92 Php 2,300 Php 180 Php 2,480 -

660 Php 4,500 Php - 61 Php 1,525 Php 270 Php 1,795 -

880 Php 6,000 Php - 46 Php 1,150 Php 360 Php 1,510 -

10100 Php 7,500 Php - 37 Php 925 Php 450 Php 1,375 -

12120 Php 9,000 Php - 31 Php 775 Php 540 Php 1,315 -

14140 Php 10,500 Php - 27 Php 675 Php 630 Php 1,305 -

16160 Php 12,000 Php - 23 Php 575 Php 720 Php 1,295 -

18180 Php 13,500 Php - 21 Php 525 Php 810 Php 1,335 -

20200 Php 15,000 Php 150 19 Php 475 Php 900 Php 1,225 Best

22220 Php 16,500 Php 165 17 Php 425 Php 990 Php 1,250 -

24240 Php 18,000 Php 180 16 Php 400 Php 1,080 Php 1,300 -

26260 Php 19,500 Php 195 15 Php 375 Php 1,170 Php 1,350 -

28280 Php 21,000 Php 210 14 Php 350 Php 1,260 Php 1,400 -

30300 Php 22,500 Php 225 13 Php 325 Php 1,350 Php 1,450 -

32320 Php 24,000 Php 240 12 Php 300 Php 1,440 Php 1,500 -

34340 Php 25,500 Php 255 11 Php 275 Php 1,530 Php 1,550 -

36360 Php 27,000 Php 270 11 Php 275 Php 1,620 Php 1,625 -

38380 Php 28,500 Php 285 10 Php 250 Php 1,710 Php 1,675 -

40400 Php 30,000 Php 300 10 Php 250 Php 1,800 Php 1,750 -

42420 Php 31,500 Php 315 9 Php 225 Php 1,890 Php 1,800 -

44440 Php 33,000 Php 330 9 Php 225 Php 1,980 Php 1,875 -

46460 Php 34,500 Php 345 8 Php 200 Php 2,070 Php 1,925 -

48480 Php 36,000 Php 360 8 Php 200 Php 2,160 Php 2,000 -

50500 Php 37,500 Php 375 8 Php 200 Php 2,250 Php 2,075 -

52520 Php 39,000 Php 390 8 Php 200 Php 2,340 Php 2,150 -

54540 Php 40,500 Php 405 7 Php 175 Php 2,430 Php 2,200 -

56560 Php 42,000 Php 420 7 Php 175 Php 2,520 Php 2,275 -

58580 Php 43,500 Php 435 7 Php 175 Php 2,610 Php 2,350 -

60600 Php 45,000 Php 450 7 Php 175 Php 2,700 Php 2,425 -

Explanation

Column AOrdering Interval In Days

The first of these cells has the value 1 entered in it.

This is the smallest ordering period, which would require stock to be ordered every day.

The second cell picks the ordering interval from the Input Data table.

The third and subsequent cells add the ordering interval to the previous cell to create

a list of values of the same interval.

Column BQuantity Per Order

This is the number of stocks which will need to be ordered.

Calculation:OrderingInterval * QuantityUsedPerDay

Column COrder Value

This is the value of the Order before any discount.

Calculation:QuantityOrdered * CostOfstocks

Column DOrder Discount

The discount which can be subtracted from the order value.

The discount is only given on orders which are equal to or greater than the

Price Break values set by the supplier.

Calculation:OrderValue * SupplierDiscount

The supplier discount is calculated using the =IF() and the =AND() functions.

If the OrderQuantity is equal to or above the first Price Break, but below

the second Price Break, then the first Price Break discount is used.

=C29*IF(AND(B29>=$G$24,B29=$G$25,$H$25,0))

If the OrderQuantity is equal to or above the second Price Break,

the second Price Break discount is used.

=C29*IF(AND(B29>=$G$24,B29=$G$25,$H$25,0))

If the OrderQuantity does not qualify for a discount, zero discount is used.

=C29*IF(AND(B29>=$G$24,B29=$G$25,$H$25,0))

Column EOrders Per Year

This is how many orders will need to be made based upon the ordering interval.

With an interval of 1, there will have to be 365 orders.

Calculation:365/OrderingInterval

This calculation may give results which are decimal, such as 2.3

This decimal will cause problems, due to the fact that the number of

orders must always be a whole number.

The =CEILING() function has been used to 'round up' any decimals to

the next highest whole number.

=CEILING(365/A29,1)

Column FAnnual Admin Costs

This is the administration costs involved in making the orders.

Calculation:OrdersPerYear * AdminCost

=E29*$G$20

Column GAnnual Warehouse Costs

This is the cost of keeping the stock in the warehouse.

It is based on the managers knowledge that on average the stock level is 50% of the

quantity ordered.

Calculation:QuantityOrdered * AverageStockLevel) * stocksCost * WarehousingCost

=(B29*$G$21)*$G$17*$G$18

Column HAnnual Total

This is the full yearly cost of ordering the stocks, based upon how frequently the

orders are made.

It does not take in to account the actual costs of the stocks, as the manager only

wants to know what the lowest values for the overheads associated with ordering and

storing the stocks systems.

However, the Discount figure is taken into account as this can be used to offset some

of the overheads.

Calculation:AnnualAdminCosts + AnnualWarehouseCosts - OrderDiscount

=F29+G29-D29

Column IThe Best Ordering Interval

This shows the Best ordering interval, giving the lowest annual overheads.

It compares the value in column H against the minimum value for all of column H.

If the two values match the word Best is shown, otherwise a dash is shown.

=IF(H29=MIN($H$29:$H$59),"Best","-")

Below is the representation of Demand vs. Supply Management

V. Financial Aspect

Banana Habit will use the personal savings, assets and investments of the management in putting up the business to avoid liabilities such as loans. Below is the projected accumulated value of their total financial figures including the expenses during the start-up year.

Banana Habit listed the estimated cash flow of the business during the start-up year.

Start-Up Requirements

Start-Up Expenses50,000

Legal 1000

Brochures3000

Insurance0

Rent0

Total Start-Up Expenses54,000

Start-Up Assets

Cash Required200000

Other current assets50000

Long-term assets40,000

Total Assets290000

Start-Up Funding

Start-Up Expenses to Fund50,000

Start-Up Assets to Fund100,000

Total Funding Required150,000

Assets

Non-cash assets1500000

Cash Requirement100000

Addt'l Cash Raised0

Starting Cash Balance500,000

Total Assets2100000

Liabilities & Capital

Liabilities & Capital0

Current Borrowing0

Long-term liabilities0

Accounts Payable0

Other Liabilities0

Total Liabilities0

Capital

Rachelle300,000

Kenneth200,000

Ruth100,000

Fatima75,000

Ruby75,000

Jera50,000

Querolyn50,000

Total Capital850,000

(Amount in Peso)

Banana Habit has a projected balance sheet as well.

Banana HabitBalance Sheet

Assets20152016

Current Assets

Cash 600,000

Accounts receivable

Inventory

Prepaid expenses

Short-term investments

Total current assets 600,000 -

Fixed (Long-Term) Assets

Long-term investments 40,000

Property, plant, and equipment 1,500,000

(Less accumulated depreciation) (2,200)

Intangible assets 112,000

Total fixed assets 1,649,800 -

Other Assets

Deferred income tax

Other 600,000

Total Other Assets 600,000 -

Total Assets 2,849,800 -

Liabilities and Owner's Equity

Current Liabilities

Accounts payable -

Short-term loans

Income taxes payable 10,000

Accrued salaries and wages

Unearned revenue

Current portion of long-term debt

Total current liabilities 10,000 -

Long-Term Liabilities

Long-term debt 9,000

Deferred income tax

Other

Total long-term liabilities 9,000 -

Owner's Equity

Owner's investment 850,000

Retained earnings 500,000

Other

Total owner's equity 1,350,000 -

Total Liabilities and Owner's Equity 1,369,000 -

{42}

Common Financial Ratios

Debt Ratio (Total Liabilities / Total Assets)0.01

Current Ratio (Current Assets / Current Liabilities)60.00

Working Capital (Current Assets - Current Liabilities) 590,000 -

Assets-to-Equity Ratio (Total Assets / Owner's Equity)2.11

Debt-to-Equity Ratio (Total Liabilities / Owner's Equity)0.01