Business Plan

Entrepreneurial Business Plan

I. Introduction A 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 the Chicago Daily Tribune made 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 Congresswoman Rosa DeLauro, the hamburger, a ground meat patty sandwiched between two slices of bread, was first produced in America in 1900 by Louis Lassen, a Danishimmigrant, owner of Louis' Lunch in New Haven, Connecticut. There have been adversary claims by Charlie Nagreen, Frank and Charles Menches, Oscar Weber Bilby, and Fletcher David. White Castle traces the foundation of the hamburger to Hamburg, Germany with its invention by Otto Kuase. However, it achieved national recognition at the 1904 St. Louis World's Fair when the New York Tribune referred 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 Summary Banana 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 country’s 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 country’s 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 Master’s in Business Administration in Philippine Women’s 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. Below is the organizational chart of Banana Habit fast food. Rachelle Anne Palecpec Founder & CEO

Kenneth Asia Chief Operating Officer

Fatima Nazareno Head, Operations

Ruth Poloan Head, Human Resource

Roelene Bulilan Head, Accounting

Ruby Garces Head, Food & Beverage

Querolyn Ballesteros Head, Marketing

Jera Ramos Head, Facilities

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 scheduling repairs, 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 from 15 – 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 and aim for cleanliness and an open 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 percentage of teenagers in the community.

All of these qualities are consistent with Banana Habit’s 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.

Here’s 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 Strategies With 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 Management Ordering 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 that’s 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. Objectiv e 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 : Cost of keeping stocks in warehouse. (As a % of the stock value) : Quantity of stocks used per day : Admin cost each time new stocks are ordered : Average quantity of stocks (As % of ordered quantity) : Ordering Intervals to evaluate. (Expressed in Days) : Suppliers first Price Break and Discount% offered : Suppliers second Price Break and Discount% offered :

Php75 12% 10 Php25 0.5 2 200 750

1% 5%

Output Ordering Interval In Days

Quantit y Per Order

1 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60

10 20 40 60 80 100 120 140 160 180 200 220 240 260 280 300 320 340 360 380 400 420 440 460 480 500 520 540 560 580 600

Order Value

Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php

750 1,500 3,000 4,500 6,000 7,500 9,000 10,500 12,000 13,500 15,000 16,500 18,000 19,500 21,000 22,500 24,000 25,500 27,000 28,500 30,000 31,500 33,000 34,500 36,000 37,500 39,000 40,500 42,000 43,500 45,000

Order Discount

Orders Per Year

Php Php Php Php Php Php Php Php Php Php Php 150 Php 165 Php 180 Php 195 Php 210 Php 225 Php 240 Php 255 Php 270 Php 285 Php 300 Php 315 Php 330 Php 345 Php 360 Php 375 Php 390 Php 405 Php 420 Php 435 Php 450

365 183 92 61 46 37 31 27 23 21 19 17 16 15 14 13 12 11 11 10 10 9 9 8 8 8 8 7 7 7 7

Annual Admin Cost

Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php

9,125 4,575 2,300 1,525 1,150 925 775 675 575 525 475 425 400 375 350 325 300 275 275 250 250 225 225 200 200 200 200 175 175 175 175

Annual Ware house Costs

Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php Php

45 90 180 270 360 450 540 630 720 810 900 990 1,080 1,170 1,260 1,350 1,440 1,530 1,620 1,710 1,800 1,890 1,980 2,070 2,160 2,250 2,340 2,430 2,520 2,610 2,700

Annual Total

The Best Ordering Interval

Php 9,170 Php 4,665 Php 2,480 Php 1,795 Php 1,510 Php 1,375 Php 1,315 Php 1,305 Php 1,295 Php 1,335 Php 1,225 Php 1,250 Php 1,300 Php 1,350 Php 1,400 Php 1,450 Php 1,500 Php 1,550 Php 1,625 Php 1,675 Php 1,750 Php 1,800 Php 1,875 Php 1,925 Php 2,000 Php 2,075 Php 2,150 Php 2,200 Php 2,275 Php 2,350 Php 2,425

Best -

Explanation Column A Ordering 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 B

Quantity Per Order This is the number of stocks which will need to be ordered. Calculation:

Column C

Order Value This is the value of the Order before any discount. Calculation:

Column D

OrderingInterval * QuantityUsedPerDay

QuantityOrdered * CostOfstocks

Order 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$24,IF(B29>=$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$24,IF(B29>=$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$24,IF(B29>=$G$25,$H$25,0))

Column E

Orders 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 F

Annual Admin Costs This is the administration costs involved in making the orders. Calculation:

Column G

Annual 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:

Column H

QuantityOrdered * AverageStockLevel) * stocksCost * WarehousingCost =(B29*$G$21)*$G$17*$G$18

Annual 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:

Column I

OrdersPerYear * AdminCost =E29*$G$20

AnnualAdminCosts + AnnualWarehouseCosts - OrderDiscount =F29+G29-D29

The 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 Expenses 50,000 Legal 1000 Brochures 3000 Insurance 0 Rent 0 Total Start-Up Expenses 54,000 Start-Up Assets Cash Required Other current assets Long-term assets Total Assets

200000 50000 40,000 290000

Start-Up Funding Start-Up Expenses to Fund 50,000 Start-Up Assets to Fund 100,000 Total Funding Required 150,000 Assets Non-cash assets Cash Requirement Addt'l Cash Raised Starting Cash Balance Total Assets Liabilities & Capital Liabilities & Capital Current Borrowing Long-term liabilities Accounts Payable Other Liabilities Total Liabilities

150000 0 100000 0 500,000 210000 0

0 0 0 0 0 0

Capital Rachelle Kenneth Ruth Fatima Ruby Jera Querolyn Total Capital

(Amount in Peso)

300,000 200,000 100,000 75,000 75,000 50,000 50,000 850,000

Banana Habit has a projected balance sheet as well.

Balance Sheet

Banana Habit Assets

2015

2016

Current Assets Cash Accounts receivable Inventory Prepaid expenses Short-term investments

600,000

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

Total Assets

600,000

2,849,800

-

-

Liabilities and Owner's Equity Current Liabilities Accounts payable Short-term loans

-

Income taxes payable Accrued salaries and wages Unearned revenue Current portion of long-term debt

10,000

Total current liabilities Long-Term Liabilities

10,000

-

Long-term debt Deferred income tax Other

9,000

Total long-term liabilities

9,000

-

Owner's Equity Owner's investment

850,000

Retained earnings Other

500,000

Total owner's equity

Total Liabilities and Owner's Equity

1,350,000

-

1,369,000

{42}

Common Financial Ratios Debt Ratio (Total Liabilities / Total Assets) Current Ratio (Current Assets / Current Liabilities) Working Capital (Current Assets - Current Liabilities) Assets-to-Equity Ratio (Total Assets / Owner's Equity) Debt-to-Equity Ratio (Total Liabilities / Owner's Equity)

0.01 60.00 590,000

2.11 0.01