A FEASIBILITY STUDY ON

ESTABLISHING A TICKETING
AGENCY
Qollective Progress Multi-Purpose
Cooperative (QPMPC)

CHAPTER I: INTRODUCTION
INTRODUCTION
Philippine tourism increased its revenue by 15% for the year 2014 which is
declared by Department of Tourism Secretary Ramon Jimenez in the
Philippine Economic Briefing. DOT believes that the market is getting strong
including US, EUROPE, and JAPANESE. Events in the Philippines have
doubled including the pope visit.
We see this as an opportunity for us to have a profitable business that will also
open opportunities for us to increase more our networks and to reach out
further to our community where help is needed.
Within the association, with our cause of providing relief, we go to different
places extending help and providing some of their immediate needs. Hence,
ticketing service is a very good business for the COOP to open and cater the
internal needs of the association and COOP and its partners. Instead of going
to other agency to book tickets, we thought of providing it on our own. Hence,
the idea of opening a ticketing service was birthed.
With proper management and decent mark-up rate, booking tickets can be a
profitable business for to anyone who has the capacity to run it. Once we
become a registered booking agent,we will be granted access to an automated
transactions between us and the airlines (domestic and international) in order
for us to provide travel-related services to customers.
A.STATEMENT OF THE PROBLEM
In this regard, the main essence of this study is to establish Ticketing service
that offers a reasonable rate of tickets to cater the travel needs of the members,
family and close friends. To determine the worthwhile of the study it sought to
answer the following aspects:
Marketing Aspect
Who will benefit on the proposed ticketing business?
What method should the business ratify in order to introduce and compete
with the existing ticketing agencies?
Management Aspect
How would the business be managed successfully and maintain it?
Technical Aspect
How the business can practically put into effect?

What are the general guidelines or implementing rules under the provisions of
Executive order No. 120 in relation to RA 7160 other wise knows as the Local
Government Code of 1991 on the Devolution of the Licensing and Regulatory
Authority over certain establishments?

How can the business earn profit and underrate its cost?
B. OBJECTIVE OF THE FEASIBILTY STUDY
To be able to identify the effectiveness of the proposed business in the market
in catering the travel needs.
To be able to formulate the most effective management techniques in operating
a business.
To find out how the business be practically put into effect.
To be able to find effective strategies of increasing the profit of the business
while underrating the cost.
C. SIGNIFICANCE OF THE FEASIBILITY STUDY
It is a challenge at the same time a great risk to put up a business. Many
factors should be considered before considering putting up an establishment.
This study would be a great help to people especially to those whose interest
are in venturing to be booking agents. The research would inform the
researchers and at the same time, see the risks and benefits of the business.
D. METHODOLOGY
The research methodology to be used in conducting this project study is the
descriptive method of research which helps the researcher since this type of
research method concerned with the description of data and characteristics
about the population that provides an accurate portrayal of the characteristics
of a particular individual, situation or a group in a current trend of the
operation.
Sources of Data
The primary source of data for this study is through research, and conduction
of questionnaires and interview from the members of Paglaum Association.
The other sources of data to be used in this study are books, other related
research papers and studies and through the internet.
E. SCOPE AND LIMITATION OF THE FEASIBILITY STUDY

This study signifies analysis of how the ticketing business will run and achieve
its projected net sales.
This study will cover the future market which is the members of the Paglaum
Association, families and friends.

It will also consider the guidelines and

implementing rules in running a ticketing agency.

F. REVIEW OF RELATED LITERATURE
Traveling helps a person grow and develop personally. People who came back
from vacation travels are mostly energized and have a different sense of aura.
Our country is reach in natural resources and tourist spots where anyone can
relax.
The Department of Tourism released that Philippines is destination for the year
2014. They were awarded by the Travel Trade Gazette(TTG) Asia months before
they raised the country's profile with its Visit the Philippines

Year 2015

campaign. With this success, DOT is gearing up its effort to promote Visit The
Philippines Year 2015 encouraging nationwide participation to build a brighter
tourism for the country.
In lieu with the DOT campaign, the travel industry is preparing for the visit of
the Pope on January and the Asia Pacific Economic Cooperation Ministerial
Meeting and Leadership Summit which will all happen next year. These events
will further promote the opportunity of the travel industry to climb more and
increase its revenue.
These are just some of the few lined up big activities that will happen in the
country and this is a big opportunity for us to be part of the travel industry
and establish our name and introduce the mission of the Paglaum Association.
Even though the economy is still its way up, people still have the time and
budget to go to different places especially that airlines are offering huge
discounts like the piso (1) fare to reach more number of people to travel.
G. DEFINITION OF TERMS
1. Global Distribution System (GDS) A worldwide computerized

reservation network used as a single point of access for reserving airline

seats, hotel rooms, and other travel related items. This is what the travel
agents use
2. VIA Phils GDS available in the Philippines that is affordable and easy

to manage.

3. Reservation - All flight reservations are based on restricted airfares.

These fares may require full payment within 24 hours after confirmation or
at the time of reservation.
4. Travel - make a journey, typically of some length or abroad.
5. Traveler- the one who makes the travel.
6. Mark-up is the difference between the cost of a good or service and its

selling price. A markup is added onto the total cost incurred by the
producer of a good or service in order to create a profit. The total costreflects
the total amount of both fixed and variable expenses to produce and
distribute a product.
7. Gross Sale Selling price. This is the total amount that will appear in

the customer's ticket

8. Net Income also referred to as the bottom line,net profit,net pay or net

earnings.
9. Flight bookings that you bought a ticket for a flight on a plane.
10. Booking ticket is a piece of evidence usually in paper reflecting your

flight details, confirmation number and summary of the amount you have
paid.
11. Flight the action or process of flying through the air.
12. Connecting flights - That requires the passengers to change from one

plane or airline to another at an intermediate point.

CHAPTER II: MARKETING ASPECT
A. INDUSTRY PROFILE
The proposed project will be introduced with a business name named
Qollective Progress Multi-Purpose Cooperative (QPMPC) Ticketing Service . The
business name is based on the name of the COOP. The project will primarily
cater the members of the Paglaum Association, its families, close friends and
networks.
B. DEMAND ANALYSIS
Table 1
Demand Analysis
TARGET MARKET

POPULATION SIZE

PERCENTAGE OVER
THE TOTAL

Cooperative Members
5 of each member's
family and friends
TOTAL

17
85

POPULATION SIZE
16.67%
83.33%

102

100.00%

The Table 1 shows a total target market of 102 who are members of the
cooperative and at least 5 of each member's family and friends who frequently
travels every month.
C. ESTIMATION OF PRESENT DEMAND

TARGET
MARKET

WILLING TO
Travel once
a month

UNWILLING
TO Travel

17

PERCENTAGE
OVER THE
TOTAL
POPULATION
SIZE
16.67%

PERCENTAGE
OVER THE
TOTAL
POPULATION
SIZE
0

Cooperative
Members
Outside COOP
TOTAL

85
15

83.33%
100.00%

0
0

0
0.00%

Based on the interviews and questions conducted by the proponent, the

summary of the present demand arrived as shown on the Table 2. All members
of the COOP are willing to travel every month either for business, leisure or
outreach. With each member's network, friends and families, we have an
average of 85 customers who are frequent travelers.
Rebooking and cancellation of flights will be made by the airlines as well as the
refund. The ticketing agency will not hold any refund nor cancellation after the
ticket has been purchased. Such transactions should be dealt with the airline's
customer service.
D.

PROJECTION OF FUTURE DEMAND

Table 3
Future Demand

MARKET

Cooperative
Members
Nonmembers

PRESENT
DEMAND

ESTIMATED

(year 1)

INCREASE
(year 2)

17
85

ESTIMATED

INCREASE
(year 3)

PERCENTAGE
OF
ESTIMATED
INCREASE

PROJECTED
DEMAND

68

272

400%

(year 1
+year 2 +
year 3)
357

340

1360

400.00%

1785

TOTAL

102

408

1632

800.00%

2142

The project will prosper in the future based on the figures presented above. At
least 400% increase of the membership in the coop will happen per year and
400% increase in outside coop network.
E. SUPPLY ANALYSIS
Since the nature of the business is booking tickets, the money used to start up
the business is the the ending balance of year 1 earned by the other business
of the COOP which is the lending. The monthly contribution of additional
capital from the members would help in the increase of the cooperatives
capital.
The project will ensure and will establish good customer service and abrupt
response to all customers for their inquiries.
CHAPTER III: TECHNICAL STUDY
A. DESCRIPTION OF OPERATION AND PROCESS
The business will provide the service of booking both domestic and
international tickets for any purpose. It is run by the coop and managed by one
of the members who has the experience in running a ticketing agency. All
payments are made thru cash and bank deposit to the agency's account. For
the first year, we will not accept credit to cover the expenses and necessary fees
for affiliation to travel associations here in the Philippines and transactions
and negotiations will be made through online for the first few months until the
COOP will find its space to open an office.
B. PROJECT LOCATION
The proposed location of the project would be at #16 Lacewood Court, South
Hills Subdivision, Labangon Cebu City

C.PROJECT EQUIPMENTS, FURNITURES & FIXTURES

Every business cannot operate without equipments, furnitures and fixtures in
the workplace. The proposed equipments, furnitures and fixtures to be
acquired before the project is implemented are the following:
EQUIPMENTS, FURNITURES & FIXTURES
One (1) set of computer
One (1) unit of printer plus scanner
One (1) unit of telephone incld. Installation
plus internet

PRICE
15,000.00
15,000.00
2,000.00

One (1) calculator

Three (3) plastic chairs and tables
TOTAL PRICE

300.00
7,800.00
40,100.00

These equipments will be used by the employees of the business to ensure the
smooth operation of the business. The proponent suggested having one set of
computer for the manager and the three (2) staff. The printer would also be
used by the staff. The business must have at least one (1) unit of telephone for
and internet connection since this operation is online transaction and
telephone is used to call airlines for inquiries if there is any. One (1) printer
with scanner will be used for scanning important documents and printing
plane tickets if requested. And of course, calculators to be used for accounting
purposes.

CHAPTER IV: ORGANIZATIONS AND MANAGEMENT ASPECTS

A. QOLLECTIVE PROGRESS MPC (QPMPC) ORGANIZATIONAL

STRUCTURE

B. PERSONNEL COMPONENT
The business will employ four (3) persons in the office, the manager, ticketing
representative and the messender. Duties and responsibilities of each
personnel are stated below:
Manager

She is the one to formulate an effective plan for the company to be well
structured

She is also responsible of delegating the tasks to her staff both inbound
and outbound transactions, coordinating with the right people involved
in the company to meet the day to day operations, staffing and organizing
the whole organization to achieve a systematic process of serving the
demands of the clients.
She is also solely responsible for the manning of marketing and sales and
managing both the revenue and the cost.

Ticketing Representative

She is the front desk and primary person to entertain the clients
especially in addressing the inquiries of the customers.

She is the one to check the availability of the flight schedule requested
upon by the clients and will push through with the booking and issuing
of the plane tickets and job orders for the accommodations and
transportation

Messenger
He will be the one to do the outbound/external transactions (e.g bank
deposits for affiliated accommodations, government agencies involved in
traveling like the Philippine Tourism Authority for the tax of children t
raveler etc. )
C. PROFILES AND QUALIFICATIONS
Manager

Graduate of any 4 year course,

Not more than 45 years of age

With 2-3 years experience in managing travel agency

Must be computer literate

Ticketing Representative

Graduate of any 4 year course

computer literate

pleasing personality

With 1-2 years experience in related field.

With good communication skills

Messenger

Graduate of any course

Proficient in MS Office

With good communication skills

Entry-Level

CHAPTER V: FINANCIAL ASPECTS

A. CAPITAL CONTRIBUTION
The study shows that in order to establish a Travel Agency, the project must
have at least P50, 000.00 start-up capital. The capital will be from the year 1
ending balance of the lending business of the COOP.
B. BASIC ASSUMPTION
The proponent will assume that the 102 present demands will all avail the
travel. On the other hand, the proponent will project 3 noncollectable accounts.
This will be the basis for any cancellation and penalty (e.g wrong input of
passenger details which is subject for correction)
For the purpose of preparing Financial Statements the proponent will assume
that the project will start its first year of operation on the first day of January
2016. Other related matters will be based on the current trend such as utilities
(electricity & water expenses).
FINANCIAL ANALYSIS
A. OPERATING EXPENSES
The projected monthly operating expenses of the project will be as follows:
Water Expense

500.00

Electricity

500.00

Telephone Expense + internet

3,000.00

TOTAL

P 4,000.00

B. SCHEDULE OF SALARIES
To attract qualified employees to fit the position, the company will offer an
honorarium for each applicant. The honorariums of each staff are as follows:
POSITIONS
Manager
Ticketing Representative
Messenger
TOTAL HONORARIA per MONTH

C. PROJECTED INCOME STATEMENT

MONTHLY HONORARIUM (PhP)

P 5,00.00
1,500.00
1,000.00
P 7,500.00

Collective Progress Multi-Purpose Cooperative (CPMPC)

Travel/Ticketing Services
PROJECTED INCOME STATEMENT
For the Year Ended December 31, 2016

Year 1

Year 2

Year 3

INCOME
Sales
Interest on Bank Deposits

300,000.00
10,000.00

571,200.00
20,000.00

1,608,800.00
30,000.00

Gross Income

310,000.00

591,200.00

1,638,800.00

90,000.00
17,000.00
12,000.00
2,000.00
36,000.00
1,150.00
3,000.00

135,000.00
24,000.00
18,000.00
2,300.00
38,400.00
5,770.00
4,000.00

175,500.00
30,000.00
24,000.00
2,500.00
42,000.00
6,600.00
5,000.00

Total Expenses

161,150.00

227,470.00

285,600.00

Net Surplus

148,850.00

363,730.00

1,353,200.00

Distributed as Follows:
Statutory Reserves
Amount for PR/IOC

44,655.00
104,195.00

109,119.00
254,611.00

405,960.00
947,240.00

Less: EXPENSES
Honoraria
Supplies
Power, Light & Water
Bonds
Telephones & Internet
Depreciation
Transportation

C. PROJECTED BALANCE SHEET

Collective Progress Multi-Purpose Cooperative (CPMPC)

Travel/Ticketing Services
PROJECTED BALANCE SHEET
As of Ended December 31, 2016

Year 1

Year 2

Year 3

Assets
Cash in Bank
Cash on Hand
Ticketing Software/Capital
Office Equipment

210,200.00
5,850.00
120,000.00
21,850.00

450,000.00
9,980.00
240,000.00
26,080.00

1,700,000.00
13,380.00
350,000.00
19,480.00

Total Assets

357,900.00

726,060.00

2,082,860.00

Liabilities
Statutory Reserves
Amount for PR/IOC
Total Liabilities

44,655.00
104,195.00
148,850.00

109,119.00
254,611.00
363,730.00

405,960.00
947,240.00
1,353,200.00

Total Members' Equity

209,050.00

362,330.00

729,660.00

Total Liabilities
& Members' Equity

357,900.00

726,060.00

2,082,860.00

Liabilities & Members' Equity

D. PROJECTED STATEMENT OF CASH FLOWS

Collective Progress Multi-Purpose Cooperative (CPMPC)

Travel/Ticketing Services
PROJECTED STATEMENT OF CASH FLOWS
For the Year Ended December 31, 2016

Year 1

Year 2

Year 3

CASH INFLOW
Sales
Members' Contributions
Interest on Bank Deposits

300,000.00
10,200.00
10,000.00

571,200.00
10,200.00
20,000.00

1,608,800.00
10,200.00
30,000.00

Total Inflow

320,200.00

601,400.00

1,649,000.00

CASH OUTFLOW
Ticketing Software/Capital
Honoraria
Supplies
Power, Light & Water
Bonds
Telephones & Internet
Depreciation
Office Equipment
Transportation

120,000.00
90,000.00
17,000.00
12,000.00
2,000.00
36,000.00
1,150.00
23,000.00
3,000.00

120,000.00
135,000.00
24,000.00
18,000.00
2,300.00
38,400.00
5,770.00
10,000.00
4,000.00

110,000.00
175,500.00
30,000.00
24,000.00
2,500.00
42,000.00
6,600.00
--5,000.00

Total Outflow

304,150.00

357,470.00

395,600.00

Net Cash Flow

16,050.00

243,930.00

1,253,400.00

Add: Beginning Balance

200,000.00

216,050.00

459,980.00

Total Ending Balance

216,050.00

459,980.00

1,713,380.00

FINANCIAL RATIOS
A. CURRENT RATIOS
To determine that the project will settle its short-term obligations, the
proponent will calculate the projected current ratio as shown below:
Current Ratio =

Current Assets
Current Liabilities

Current Ratio = P 357,900/ P 357,900

Current Ratio = 1
The computed current ratio 1 proves that the business is capable to settle its
short-term obligations.
B. PROFIT MARGIN
Net profit margin is a key financial indicator used to assess the profitability of a
company. Below is the computation of the Net Profit Margin of the business:
Net Profit Margin =

Net Income

x 100

Revenue
Net Profit Margin =
Net Profit Margin =

P 148,850/ P 310,100 x 100

48%

The net profit margin of 48% shows that the business can convert revenue into
actual profit.
EVALUATION OF PROJECT STUDY
A. RETURN OF INVESTMENT
Based on the projected income statement of the business, a total gain of
P 310,00.00 was earned while a total operating/administrative expenses of
P 161,150.00 was also incurred during the year. To get the ROI, the illustration
is drawn below:
ROI = (Gain from Investment Cost of Investment)
Cost of Investment
ROI = (310,000.00 -161,150.00)/161,150.00 x 100%
ROI = 148,850.00/161,150.00 x 100%
ROI=

92.36%

As shown on the above computation, it has a 92.36% ROI. Therefore, the

project is said to be feasible.
CHAPTER VI: CONCLUSIONS AND RECOMMENDATIONS
Establishing a ticketing service within the coop and close networks is feasible
to the CPMPC. It has 92.36% ROI on its first year and will eventually increase
all throughout the years.

As per the interviews and questions conducted by the proponent, having a our
own ticketing service will make us easier to book and check for any promotional
fares that low cost courier offers. Through this, we can plan our community
outreach effectively and timely.
Therefore, we conclude as per data gathered and based on the results, it shows
that the project will help and assist the association's need in reaching out
remote communities and oppressed population throughout the country. Aside
from that, it would be easier for us to transport more volunteers and partners
for us to join in our events and activities.

CHAPTER VII: DESIRABILITY OF THE PROJECT

The primary objective of this study is to determine the feasibility and viability
of a proposed plan to establish a ticketing business of CPMPC. Part of this
study is to be able to shed light to the proponents of this project as to the
risks, expenditures, benefits, marketability and profitability of the services.
After interpreting the data gathered and concluding that the proposed project
is feasible. We made some financial projections that show a favorable outcome.
It has been estimated that after a year of operation the project can enjoy the
net increase of P 148,850
Moreover, this project does not only give a great deal of benefits to the
proposing parties but to the society as well. With the establishment of this kind
of business, generally, it can contribute to the improvement of the economy
especially in the tourism industry.

As projected, the demand for the business

would increase every year. This implies that the need for more employees would
increase thus giving a venue