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University of Cebu, Lapu-lapu and Mandaue

A.C. Cortes Ave., Looc, MandaueCity, Philippines

MIDAS HANDICRAFT COMPANY

An Undergraduate Feasibility Proposal Presented to the Faculty of


College of Business & Accountancy

In Partial Fulfillment of the Requirement for thesubject BA-7A Feasibility


Study 1 for the Bachelor of Sciencein Business Administration

Aguanta, Ivy Marie


Cananea, Marlyn
De Vera, Jolina
Romo, VerissaShexen
Zurbano, Meriam

March 2016

CHAPTER I
INTRODUCTION

People are quite obsessed with making everything beautiful. Women tend
to buy make-ups, lipsticks, accessories and etc. to improve their appearances.
Men also buy different accessories for their cars to make it look cool or flashy.

Aside from making themselves and their stuffs more beautiful, people also
tend to make their surroundings like their houses and their business
establishments attractive, by some decorations like paintings, figurines,
chandeliers and lampshades. Midas Handicraft Company can provide that
lampshades and chandeliers, which are classified as Light Fixtures.

Light Fixture, light fitting, or luminaire is an electrical device used to create


artificial light by used to create artificial light by use of an electrical lamp. Itis also
considered asdecorative instrumentthat covers the light bulb on to diffuse the
light it emits.It can be conical, cylindrical, and other forms.Midas Handicraft
Companys light fixtures is called beezle. Beezlelight fixtures main material is
yarn, which is quite unusual because the light fixtures which we have in the
market today are usually made of glass. Aside from its unusual material, Midas
Handicraft Company also offers a wide variety of more decorative light fixtures
that surely satisfies the customers need.

PROJECT SUMMARY
A. Name of the Enterprise
Midas Handicraft Company was the name establish by the proponents
for their company. It was derived from the popular King Midas of Phrygia in
Greek Mythology, who has the ability to turn everything he touched into gold.
The proponents chooses that name because the most essential and best
instrument of making their product are the hands, so it is being look like their
hands are like King Midas Hands, which can make something as precious as
gold. The proponents also choose that name to portray elegance toward their
customer.

Figure1.Company Logo
The company logo consist of golden hands and the name of the enterprise.
Golden hands which signifies hard work, creativeness, ambition and passion. The hands
are gold because it gives the company the positivity to have good sales.

Mission
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1. The company will promote creativeness.


2. The company will provide an affordable product to the
customers.
3. The company will assure the customers satisfaction.
Vision
Midas Handicraft Company envision to be a well-known
manufacturer, seller, provider and supplier of Beezle Light Fixtures.
Goals
To be preferred retail store of light fixtures.
B. Location
Midas Handicraft Company will be situated in M.L. Quezon National
Highway,Lapu-Lapu City beside the house of the grandparent of one of the
proponent. The proponents chose this location because its just near to many
business establishmentslike Tongro and Rhema Brideway Church, one ride
to Lapu-lapu City Public Market, 4 minutes ride to Gaisano Island Mactan
and 3 minutes going to Mactan Airport.
C. Definition of the Project
Having the right atmosphere helps any houses and establishments look
good. Looking at any restaurant review site, it quickly becomes apparent that
customers comment on a dining establishments atmosphere and decor
almost as much as they do about the food and the service. Patrons notice it
and many do not bring repeat business to a restaurant that is lacking in this
area, no matter how good the food is. The light fixtures are responsible for
that right ambiance in any establishments and houses.
Midas Handicraft Company has to be competitive and will create its
name in the Light Fixtures Industry through providing a high quality but
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affordable products to the economy. One of the objectives of the partners is


not just maximizing its wealth but to give life beauty to everyones places.
D. Projects Long Range Objectives
For the next ten years, Midas Handicraft Company is expecting to grow
and have its difference branches in different places. Nowadays, it is difficult
to start a business because there is a tough competition in the market but
the proponents will do their best to conquer it to ensurethe success of the
business by proving customers satisfaction they need.
E. Feasibility Criteria
The project will surely be profitable upon considering its variety of target
markets and surely be known in the country for its uniqueness. In order that
Midas Handicraft Company will surely succeed, the following has to be given
significance:
1. Capital Investments. The business does not require a lot of materials
to be used upon creating the product. In other word, lesser amount of
capital has to be required in order for the business to operate. The
initial investment of the Midas Handicraft Company is P 150,000.00
which is expected to be returned in less than two (2) years.
2. Customer Satisfaction. Proper quality control shall be observed in
making the product to achieve customer satisfaction thus enables the
business to sustain and succeed.
3. Proven Market. People are fond of decorations and innovations which
is a strong indication that the proposed business will be feasible.
F. Highlights of the Project
1. History
It has been a day or two thinking with the group as to what
product are they going to propose in to. Lot of ideas came into their

minds. The proponents has been looking for a product that would
probably be feasible to market.
The proponents proposed two products to their adviser. The
first proposal is a cake with a salad on its inside. Mr. Veril told the
proponents that the cake was just okay but the costing is too
expensive. With that, the proponents decided to offer and
introduced their second choice which is the beezle. It has also been
the desire of the proponents to continue what has been their
instructor suggested to venture the said business product.
With the approved proposed product, it will be an advantage
because one of the proponents parents has a business that will
probably help them promoting their product to another market
which is the neighboring countries through exporting, Zurbanos
parents has connections on how to promote their products abroad
since her mother also has business through exporting but since the
proponents is just starting their business they decided to focus here
in Lapu-Lapu City for two (2) years.

Project Timeframe and Status


A. PROJECT PLANNING
This has been the overall plan for the business.
In-depth analysis and planning are involves in running
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the business. Gathering of useful information will


serve as the framework of the system of Midas
Handicraft Company with the help of one of the
proponents parents is considered as part of the
planning since she has the access for exporting
products.
B. PERMITS AND LICENSES
It has been required for the business to have
permits and licenses in order to operate. Since the
proponents decided to be partnership, only Mayors
and DTI permits and other legal documents should be
complied to the Bureau of Internal Revenue and is
expected to be complete in 30 days. In order for the
proposed business name not give any hassle, the
proponents has to submit to the DTI for approval on
January 15, 2016 and is expected to have feedback in
a week, and Mayors and BIR Permit will be follow
and expected to complete on February 15, 2016.

C.

ACQUISITION

AND

INSTALLATION

OF

EQUIPMENT, FURNITURE AND FIXTURES AND


SUPPLIES
The business only uses manual (with the use
of hands) way in doing products and services, so
Machineries & Equipment are not that needed for
production, only for administration purposes. Furniture
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& fixtures and supplies are expected to be completed


in less than 20 days. Acquisition and installation will
start on March 25, 2016.
D. PROMOTION
The method that the proponents will be using
to spread the word about the said product is/are
through giving or distributing brochures and flyers to
civilians, postingsome tarpaulins, and even using the
internet marketing with the help of Facebook and
other social networking sites.

E. NORMAL OPERATION
From planning to acquisition of materials and
installation of equipment takes several days and
weeks to accomplish.The business is expected to
start its operation on March 25, 2016.
2. Nature of the Industry
Midas Handicraft Company is a Partnership which is a
manufacturer, seller and supplier of Beezle Light Fixtures.Although
there are existing companies who already offers light fixtures, the
proponents will make sure to offer a unique and affordable ones to
catch customers attention. The proponents will see to it that proper
accommodation of customers will be observed and make sure to
satisfy customers need.
The Midas Handicraft Company will be into consignment
business, since they're location is just near to many vendors. They
will also be a supplier of Beezle Light Fixtures in Alcon Industry,
where Zurbanos parent is working.
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3. Mode of Financing
The initial capital that has been agreed by the members of
the proponents is P 150,000.00 which will be coming from
individuals investments. There will be P 25,000.00 per partner.
Instead of just putting the money in the bank with a minimal interest
per annum, the proponents decided to venture into business for
their money to gain higher return on investments.
4. Investment Cost
BeezleLight Fixtures is relatively inexpensive and a good
investment. With that, it only needs a lower amount of capital in
order to run and operate its production and any other related
transactions. Upon agreed, the estimated initial start-up capital
would be P 150, 000.00 which have to have return in two (2) years.

Table 1
Business Start Up Cost
PARTICULARS
PRE-OPERATIONG COST:
Permits & Licenses
Prepaid Rents (3 months)
Interior & Exterior Improvements
FIXED ASSETS:

AMOUNT(Php)
5,000.00
18,000.00
10,000.00

TOTAL (Php)

33,000.00

Furniture & Fixtures


Office Equipment
WORKING CAPITAL:
Raw Materials
Tools
Office Supplies
Promotion
Contingent fund

6,300.00
15,000.00

21,300.00

85,000.00
600.00
1,000.00
1,500.00
7,600.00

95,700.00

TOTAL

150,000.00

As shown in the table above, the cost for rental is prepayment good for two (2)
months advance that will be consumable for the first two months and one (1) month deposit.
All other cost is allocated good for one month operation of the business.

G. Major Assumptions
1. Market Feasibility
Customers satisfaction would take part on the growth of the business.
There is always a room for improvement to fully meet the needs of the
customers. The proponents will do their best to communicate with their
customers and understand the product they're looking for.
The proponents would adopt practical strategies that would then
lead to more demandable and competitive product. They will be keener on
the overall operation process of the product and the proponents will be
considerate on the products price and the proponents are constantly open
for expansion to provide accommodation on the growing demand for these
new items.
2. Technical Feasibility
Midas Handicraft Company is a Light Fixtures Industry that does
not require expensive equipment and technology. Using of hands are the
most essential equipment that will be needed in making their product.
2. Financial Feasibility

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In venturing into business, it is very important to be ready in terms of


financial aspects. It needs medium term preparation and planning. Every
decision should be planned carefully in order to attain success in
operating the business. In financial aspects, the business should be
capable if ever there will be a credit made for additional funds of the
business. Midas Handicraft Company planned that the five partners of the
said partnership will invest specific amount of money from their savings as
a capital and the five partners will also invest equal effort and time to put
up this business. The proponents are willing to take the risk unavoidable
losses, liabilities, and problems that they may encounter in operating the
business.
The direct materials expenses, indirect and overhead should be
properly evaluated. Our investment is enough to finance our daily
production, utilities and facility equipments, building, administrative
expense and other unanticipated expenses required in business
operation. Our funds will be used accordingly to prevent losses.
3. Socio-Economic Feasibility
Innovating is one of the factor that can make a company
successful, changingit's product to a unique one,trendier and other tactics
to catch customersattention.The Midas Handicraft Company will make
sure to offer products that are more creative light fixtures to surely satisfy
the taste of the consumer.
4. Management Feasibility
Management plays a very vital role in any organization. Every day
of our lives, we need management in order for it to be well-planned and
organized. Every business should strive to be always among the best in its
line and to render full satisfaction to its clientele. In which management
skills are essential for the enterprise to sustain among the best.

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Midas Handicraft Company involves a group of five (5) partners,


each one employee must master each function, from production down to
accommodating customers. Partners generally agreed the terms and
conditions set among the partners of which the agreement is to have a
mutual contribution. We will be giving our individual shares for investment
in which, each of us is entitled to claim the ownership on the contributed
assets and in mutual agency. The partners are accountable for the equal
divisions of profits and losses. They will increase their labor as the
business expands.

CHAPTER II
MARKET STUDY
Midas Handicraft Company where you can find the very creative and
attractive hand making designed products that made only from a yarn. You can
make your own design and choose a good one. It can also help you to relax just
by looking/seeing at it in a place where it can be found.
Product Description
Midas Handicraft Companys product is the Beezle Light fixtures. Beezle,
which is a combination of the word bee hive and dazzle, bee hive because the
light fixtures look like a bee hive. Dazzle because it greatly impresses and
attracts the eyes of one another.
Place
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Midas Handicraft Company will be situated in M.L. Quezon National


Highway, Lapu-Lapu City beside the house of the grandparent of one of the
proponent. The proponents chose this location because its just near to many
business establishmentslike Tongro and RhemaBrideway Church, one ride to
Lapu-lapu City Public Market, 4 minutes ride to Gaisano Island Mactan and 3
minutes going to Mactan Airport. Alcon Industry is our target market, known as
PhilExport in Cebu. This identified market is enough as our target market where
we can export our products.
Market Segmentation
Location
M.L. Quezon National Highway

Income
Product
Php 50,000.00 / Beezle (light fixtures) and
month and up Personalized Beezle
Php 100,000.00 / Beezle (light fixtures)

Alcon Industry

month and up

Price
The pricing scheme is based on the products that you wanted.
COMPARISON OF PRICES
Products

Market Price

Beezle (String Chandelier)

Php 270.00

Personalized Beezle design

Midas Handicraft Company


Php 220.00
Php 500.00 Php 1000.00

(Depends on the design)

Pricing scheme above that surely satisfied your needs from Midas
Handicraft Corporation offer you the most affordable and cool prices that is
competitive to what other Market has.

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Promotion/Marketing Program
In generating competitive responsiveness to the identified market, the
proponents decided to use the following:
1.
2.
3.
4.

Posters
Flyers
Tarpaulins
Using Social Networking Sites such as Facebook, Twitter and
Instagram

Midas Handicraft Company aims to make their products known in the


market and they believe through effective promotion and communication with
customers are the key to achieve that goal.

CHAPTER III
TECHNICAL FEASIBILITY
A. PRODUCTS/SERVICES
Midas Handicraft Company is a supplierwho provides to its clientele to
satisfy their order such as personalized beezle product and beezlelight fixtures
as its main product that is being offered.
1. Beezle Light Fixture - using balloons, glue andyarn, you can also make
these lanterns for your wedding and then bring it home and use it as
your very own mid-century.
2. Personalized Beezle - designed by yours that you want to, of course
using only the glue and yarn that will satisfy your needs.
All these products are available only in Midas Handicraft Company as well
as our services that we have, we already have the respective buyer/customers
with regards to its terms and availability..
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B. MANUFACTURING PROCESS
Manufacturing process is the production of goods and which rawmaterials
are transformed into a final product and transforms ideas into products that are
then distributed to the market for sale. In a free market economy, manufacturing
is usually directed toward the mass production of products for sale to consumers
at a profit.

The manufacturing of Bezzle Light Fixtures involves the following steps:


. STEP 1. Prepare the
materials.

STEP 6. Put the lamp


extension cord.

STEP 2. Dip the yarn into


the glue

STEP 3. Wrap the glued


yarn in the
inflatable/balloon.

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STEP 5. Inflate the


balloon.

STEP 4. Wait after 40


minutes to dry the yarn.

Figure 2. Production Process

C. PLANT SIZE & PRODUCTION SCHEDULE


The plant size is thirty square meter (30sqm.), the area will be divided into
two: the production and office area.The Midas will operates from eight oclock in
the morning until five in the afternoon (8:00 AM to5:00PM) from Monday to
Saturday.
The proponents decided to make thirty(30) beezle light fixtures every day.
D. MACHINERY & EQUIPMENT
Midas Handicraft is very easy and simple and the raw materials are very
cheap and easy to purchase. The most used raw materials are Cotton yarn,
Lamp Socket Extension, and Glue. The business is completely depends on
individual skills and does not need any machine to use but completely made by
hand or by using only simple tools and make different styles and designs.
E. BUSINESS LOCATION

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Figure 3 BUSINESS LOCATION


Midas Handicraft Company will be locatedin M.L Quezon National Highway,
Lapu-Lapu City. The building is ready for occupancy and the utilities like water and
electricity already existed and connected.

F. BUSINESS LAYOUT
6m

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5m

Figure 4 BUSINESS LAYOUT


The layout shown in figure 4 above is consist of a 30 sqm.floor area that can
occupy the receiving area, display area, production area and comfort room.

G. BUILDING & FACILITIES


To start the business, the area of the building is 30 square meters with
a total rental payment of Php6,000.00.
H. RAW MATERIALS & SUPPLIES
Below are the listed materials needed for the production of Bezzle
Light Fixtures:
a) Glue
b) Yarn
c) Lamp Socket Extention

I .UTILITIES

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As mentioned, the monthly rental cost of the building is Php 6,000.00. Midas
Handicraft Company supposed that Php 2,000.00 is the monthly bill of the water
and Php400. 00 for the electricity.
Electricity

Php 2,000.00

Rental Payment

Php6,000.00

Water

Php 400.00

Total

Php 8,400.00

J .WASTE DISPOSAL
Midas Handicraft Company is concern about the cleanliness of our
surroundings. Midas provides three different labeled trash bins: recyclable,
biodegradable and non-biodegradable inside the production area to ensure the
health of the workers and to control waste disposal.
K. PRODUCTION COST

Electricity
Water
Rental Payment

OVERHEAD COST
Php 2,000/26 days/30 light

2.564

fixtures
400/26 days/ 30 light fixtures
6,000/26 days/30 light fixtures

0.513
7.692

For Production:
DIRECT
MATERIALS
Yarn

UNIT COST

QUANTITY

Php 0.125/yard
19

50 yards

COST PER
PRODUCT
6.25

Glue
Lamp

3.52/oz
90/ pcs.

Socket

4 oz
1 pc.

14.08
90.00

Extension

DEPRECIATION UNIT

QUANTITY

EXPENSE
COST
Scissor
Php 20.00
Inflatable Ball
40.00
Production Table
1,000.00
Tape Measure
20.00
Monoblock Chair
200.00
Ceiling Fan
400.00

USEFUL

COST PER

LIFE
5
10
1
5
5
2

2
1
3
2
3
3

PRODUCT
0.006
0.044
0.037
0.006
0.037
0.030

For Administration Purposes:


DEPRECIATION

UNIT

EXPENSE
Ceiling Fan

COST
Php

Office Table
Monoblock Chair
Computer Set

400.00
2,300.00
200.00
15,000.0

QUANTIT

USEFUL

LIFE

0
Total Cost per Beezle Light Fixtures:
Mark Up (80%)

COST PER

PRODUCT
0.015

1
4
1

3
3
5

0.085
0.030
0.332
121.721
97.376
219.097
Or 220.00

L. LABOR REQUIREMENTS
A labor requirement refers to the guidelines of people who worked in the
business. Human resources are needed no less important than financial
resources in achieving the main objective of planned development.
As of now, since the business will just start its operation, the proponents
decided not to hire any employees and make the product by themselves.
They will only hire if the business expands and if there are many orders that
they cannot handle by themselves. If labors are needed, educational
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attainment will not highly be necessary as long as skills and motivation is


present.

Organizational Chart

Jolina De Vera
Operation Manager

Meriam
Zurbano

Verissa
Shexen Romo

Craft Maker/
Quality
Controller

Craft Maker/
Sales
Manager

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Ivy Marie
Aguanta

Marlyn
Cananea

Craft Maker/
Sales
Manager

Craft Maker/
Accounting
Manager