Chapter 1 EWRS

Chapter 1
INTRODUCTION
A. Brief History
Water is an essential and the major components of all living matter, and the
largest single component of our bodies. As a natural resource, water was free and clean,
but because of the result of industrialization the need to treat drinking water was
inevitable.
It is a basic concern of almost every individual to have safe drinking water for the
entire household. There is already at present a growing awareness that it is better to spend
a bit more in drinking water than to spend so for hospitalization as a result of diarrhea or
other related diseases.
Outside Manila far fewer people have access to clean water distribution. In both
locations, these families must find alternate water sources if they are to
avoid cholera epidemics and other health problems spawned by the foul, contaminated
water available in their neighborhoods.
According to the Department of health, diarrhea-related diseases is one of the top
ten leading causes of death in the Philippines for the last three decades since 1981.
(Department of Health)
The researcher proposed on working Aqua Light Water Refilling Station in
Matimbubong, San Ildelfonso, Bulacan. For the reason of, preventing water
contamination which can cause diarrhea, gastro-intestinal and other related diseases. The
source of water to be used for the purification process will be the water supplied from
deep well.
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B. Statement of the Problem
The central problem of this study is the evaluation of the feasibility and viability
of Establishing Aqua Light Water Refilling Station in Matimbubong, San Ildefonso,
Bulacan.
C. Objectives
The main objective of this study is to determine the viability and feasibility of the
proposed venture taking into consideration of the following four functional areas of
management as follows:
Marketing
a. To identify the demand and supply for the product offered in order to
determine the market share.
b. To formulate marketing strategies for a successful business operation.
c. To describe the general trade practices of an industry on business who
sells the same product.
d. To present a comprehensive description of the product being offered
and to evaluate competitors.
Production / Technical
a. To develop the processes involved in operationalizing the project in
the most effective and economical way.
b. To be able to choose the best equipment, machineries, furniture and
fixtures needed in the business but also balancing technology with
cost.
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c. To determine the most strategic and specific location of the business.
d. To select an appropriate way in acquiring the building.
e. To determine the best time schedule of business operation.
f. To determine the operating cost, labor cost, and other cost of
production.
Organization and Management
a. To design the most appropriate business organization set-up.
b. To determine the personnel needed and the characteristics they must
possess.
c. To establish the timeframe for the design and implementation of the
proposed project.
Financial
a. To make an estimate of the amount of total investment required to
implement and operationalize the project.
b. To evaluate the profitability, liquidity and stability of the business
venture.
c. To forecast future revenues and expenses.
d. To present the projected financial statement.
D. Significance of the Study
This study bears significance to the following:
To the businesspersons, this research will give additional knowledge and ideas of
where and how to put and use their money for investment;
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To the researcher, this study will supply them the opportunities to apply the
theories and knowledge obtained in the preparation to their planned professions;
To the school, this study will give additional guide and reference to the students
who is planning to proceed and develop the research;
To the readers it will give knowledge and open-mindedness in the said business
where they can have enlightenment for exploring the business it proposed; and
To the community this may these proposal one day be a reality and help in the
establishing a small enterprise and further help the countrys economy.
E. Scope and Limitations
This study basically deals in the establishment of an Aqua Light Purified water
refilling station in Puting Kahoy Silang, Cavite. The residents of Matimbubong,
Malipangpang and Pinaod, San Ildefonso, Bulacan are the target market of the proposed
business. The study is constrained to the first five- years of operation, and the researchers
are not responsible beyond the period of five years. Other information are based from
personal interview, survey, book, articles, and internet surfing.
Due limited time and resources, the researcher was not able to gather more
detailed data for the study. And some data were not given because of confidentiality and
some planned interviews were denied by the prospective interviewee with the reasons the
researcher do not know. Due to these limitations, some important matters may not be
included. However, information presented on this paper can be relied upon, and are
guaranteed to be factual.
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F. Methodology
The researcher used both primary and secondary data in collecting facts and
information. Primary data came from the original sources and collected especially for the
task, which includes interviews and survey questionnaires. Secondary data were gathered
and based from the original piece on reading materials where the information evidence
which includes article magazines and other written materials, books and internet
1. Sources of Data
a. Primary Data
The data were gathered from interview and survey questionnaire. As a
requirement, the survey questionnaire was validated by experts and laymen to make sure
that the questions are understandable and easy to answer. The researcher conducts his
survey questionnaires in San Ildefonso, Bulacan. All the respondents were given
questionnaires and others sampling techniques.
b. Secondary Data
The data were derived in the researcher, from the printed materials, book, articles,
dictionaries and magazines, which includes our own, MAC Library, and internet
resources such as Encarta, Google, Wikipedia and the Department of Health.
2. Research Design.
The researchers used both the descriptive and explanatory method to arrive at
historical trends and projections. The purposive sampling technique is used in the
distribution of the questionnaires to the respondents. The formula below was used to
arrive at the sample size.
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n= N
1 + Ne2
Where: N = Estimated Population
e = Margin of error
n = Sample size
Based on 2014 data, the total household population is 2,962. With a margin error
of .12 or 12%, the number of respondents was computed as follows
n= 2,962
1 + 2,962(12%) 2
Where: N =2,962
e = 12%
n = 70
3. Treatment of Data
a. Projections.
The formula is: Yc = a + bx, where:
a = _-bX_
n
XY
b = XY - n___
X2 (X)2
n
Where: X = is the assigned value
a = is the constant
b = is the parameter
Y = is the given/gathered data
n = number of years
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b. Earning Power.
In relation to the earning power of the project, researcher applied the
following formulas:
1. Net Present Value (NPV)
The net present value finds the balance of the trade- off between
investment outlays and future benefits. The present value factor should first be
decided to determine the balance, which is the difference between the present
value of net cash operating inflows and the present value of investment.
In short: If NPV > 0; Accept
If NPV < 0; Reject
Formula: NPV = b i c i
( 1+r ) n
1=0
2. Internal Rate of Return (IRR) the formula for IRR is as follows:
IRR = NPV bi Ci = 0
( 1+ r) n
This refers to the rate of return that a long term investment earns. When
the IRR is greater than zero, this means that the ensuing answer is greater than
the required rate so the project can be accepted. However, if the IRR is less
than the NPV, this implies that the IRR is lower than the required rate. It is
then necessary to reject the project.
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3. Benefit Cost Ratio
This establishes the ratio between the present value of future net
benefits and the initial cost. Indicator used that attempts to summarize the
overall value for money, of a project proposal. Ratio of the benefits of a
project, expressed in monetary term, relative to its cost also expressed in
monetary terms. The formula is:
B/C Ratio = ___ bi____
1 = a (1 + r) n
_____ ci____
i = a (1+r) n
Where; bi = benefit in period i
Ci = cost in period i
r = discount rate
n = discount period
If the value is positive, which means that the gross benefits are greater
than the gross costs, then the project may be accepted and be rejected if not.
c. Profitability Ratios.
This ratio show the operational and efficiency of the project or used to
know if the profits are sufficient relative to the asset being invested.
1. Rate of Return on Sales. This ratio signifies the amount of net
earnings in peso of sales. A considerably positive ratio implies a
satisfactory return so it is safe to pursue the project.
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Return on Sale = Net Profit After Tax
Sales
2. Rate of Return on Investment. This ratio indicates the profitability of
the business in connection with the total invested capital. If the result
is significantly more than zero, then the investment earns well so it is
advisable to accept the project.
Return on Investment = Net Income

Total Investment
3. Gross Profit Ratio. This ratio indicates the gross income per peso of
sales and used in determining the sufficiency of gross margin to cover
operating expenses and provide desired profit. A favorable ratio is
achieved when it is positive, thus implying that the project is capable
to finance its operating costs. The formula employed is:
Gross Profit Ratio = Gross Profit

Net Sales
d. Test of Return on Capital Investment.
These financial tools evaluate the justification for investing in the
proposed project.
1. Average Rate of Return - the ratio of the average cash inflow to the
amount invested.
Average Rate of Return = ____Average Net Income______

Initial Year Cash Outflow
2. Payback Period in Years - represents the amount of time that it takes
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for a capital project to recover its initial cost. A shorter payback
period would be favorable.
Payback Period in year = ____Initial-Year Cash Outflow__

Succeeding Annual Net Cash Flow
G. Review of Related Literature
Water is a fundamental human need. Each person on Earth requires at least 20 to
50 liters of clean, safe water a day for drinking, cooking, and simply keeping themselves
clean. Polluted water is dirty which can be deadly. Some 1.8 million people die every
year of diarrheal diseases like cholera. Tens of millions of others are seriously sickened
by a host of water-related ailments. Nowadays, many of which are easily preventable.
(www.drinking-water.org)
Water is a necessary component of life. Without it, death itself will prosper.
Water is use for the daily maintenance of the body. Drinking water quality is important
for health and wellness. Water purification can be an aid to removing harmful
contaminants from the drinking water supply, but it can also introduce harmful
carcinogenic elements into the drinking water supply that can become toxic over time and
have unpleasant or dangerous side effects.
According to a 2007 World Health Organization report, 1.1 billion people lack
access to an improved drinking water supply, 88 percent of the 4 billion annual cases
of diarrheal disease are attributed to unsafe water and inadequate sanitation and hygiene,
and 1.8 million people die from diarrheal diseases each year. The WHO estimates that 94
percent of these diarrheal cases are preventable through modifications to the
environment, including access to safe water. Simple techniques for treating water at
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home, such as chlorination, filters, and solar disinfection, and storing it in safe containers
could save a huge number of lives each year (en.wikipedia.org)
Outside Manila far fewer people have access to clean water distribution. These
families must find alternate water sources if they are to avoid cholera epidemics and other
health problems spawned by the foul, contaminated water available in their
neighborhoods. Some people rely on wells or even on rivers for their supply of water for
their daily consumption.
The demand for cleaner water becomes higher the price of household water
purifiers and bottles water has become prohibitive. Water refilling stations managed by
private entrepreneurs offer a cheaper and more convenient solution to the publics
drinking water needs than bottled water or the use of household filters. They are many
benefits in using Water Filter (Purification) it includes:
Water filters provide better tasting and better smelling drinking water by
removing chlorine and bacterial contaminants.
Point-of-use water filters remove lead from drinking water immediately prior to
consumption, thus preventing this harmful substance from entering the body.
The purchase of a countertop filter results in a source of clean, healthy water that
costs much less than bottled water.
Water filters greatly reduce the risk of rectal cancer, colon cancer, and bladder
cancer by removing chlorine and chlorine byproducts from drinking water.
A solid block carbon water filter can selectively remove dangerous contaminants
from drinking water while retaining healthy mineral deposits that balance
the pH of drinking water.
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Drinking clean, filtered water protects the body from disease and leads to overall
greater health.
A water filter provides clean, healthy water for cooking, as well as drinking, at the
convenience of tap water.
Water filters reduce the risk of gastrointestinal disease by more than 33 percent by
removing cryptosporidium and giardia from drinking water.
Drinking pure water is especially important for children. Water filters provide the
healthiest water for childrens developing immune systems.
Water filters offer the last line of defense between the body and the over 2100
known toxins that may be present in drinking water. (www.allaboutwater.org)
There are different ways in which the processing of drinking water was being
conducted. One of which is desalination, this involves processing boiling salt water in as
many as 20 to 50 multistage chambers so dissolved salt is left behind and also condensing
the steam or water vapor by cooling to produce high quality water.
In Distillation, use heat to boil contaminated water and produce steam. Impurities
such as inorganic compounds and large non-volatile organic compounds are not
vaporized and are left behind in the boiling chamber of the unit. The heat inactivates
bacteria, viruses, and protozoan cysts. The steam rises and enters a cooling section
containing condensing coils. The steam cools, condenses back to a liquid, and the water
flows into a storage container. This collected water can have up to 99.5 percent of
impurities removed. The water remaining in the boiling chamber has a much higher
concentration of impurities. This water is removed by a drain and discarded.
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In reverse Osmosis, water is forced through an extremely fine membrane to
remove dissolved minerals. Purified water passes through the membrane and collects in a
storage container. Most of the dissolved minerals in the water cannot pass through the
membrane and are flushed away as waste. Small household reverse osmosis systems
flush from three to twenty liters of water to waste for every liter of treated water. This
flushing helps maintain treated water quality and prevent fouling of the membrane.
Reverse osmosis competes directly in the marketplace with distillation. Both can
provide small amounts of high quality water for drinking, automatic humidifiers and
watering plants.
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H. Definition of Terms
Chlorine is a halogen element that is isolated as a heavy greenish-yellow
diatomic gas of pungent odor and is used especially as a bleach, oxidizing agent, and
disinfectant in water purification. (www.merriam-webster.com)
Desalination refers to the processes that remove salt from ocean water to make it
suitable for human consumption and use. (Aulbach & Corradi, 1988)
Distilled water, water that has ph level of seven no additional gases, mineral or
contaminants, ideally be nothing but hydrogen and oxygen molecules.
(www.wisegeek.com)
Drinking water or potable water is water of sufficiently high quality that it can
be consumed or used without risk of immediate or long term harm. In most developed
countries, the water supplied to households, commerce and industry is all of drinking
water standard, even though only a very small proportion is actually consumed or used in
food preparation. (http://en.wikipedia.org/wiki/Drinking_water)
Diarrhea describes loose, watery stools that occur more frequently than usual.
Diarrhea is something everyone experiences. Diarrhea often means more-frequent trips to
the toilet and a greater volume of stool. (www.Mayoclinic.org)
Distilled Water is a water from which impurities, as dissolved salts and colloidal
particles, have been removed by one or more processes of distillation; chemically pure
water. (www.dictionary.reference.com)
Purified water refers to all types of water from which chemicals are removed via
a variety of different process. (www.wisegeek.com)
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Reverse Osmosis is a filtration method that removes many types of large
molecules and ions from solutions by applying pressure to the solution when it is on one
side of the membrane. (www.wikepedia.com).
Toxic is poisonous material especially when capable of causing death or serious
debilitation. (www.merriam-webster.com)
Water Filter removes impurities from water by means of a fine physical barrier, a
chemical process or a biological process. (www.wikepedia.com).
Water Pollution is an undesirable state of the natural environment being
contaminated with harmful substances as a consequence of human activities.
(www.thefreedictionary.com)
Water purification is the process of removing undesirable chemicals, biological
contaminants, suspended solids and gases from contaminated water. (en.wikipedia.org)
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Exhibit 1
Sample Survey Questionnaire
Greetings! I am a Business Students of Manila Adventist College enrolled in

Business Research with Feasibility Study. We are conducting a research on feasibility
entitled Establishing Aqua Light Purified Water Refilling Station in Matimbubong,
San Ildefonso, Bulacan.
May we request your assistance on answering the questions below. Rest assured
that all the information gathered will be treated with strict confidentially and shall be
used by the researcher for academic/educational purposes only.
Thank you very much for your favorable response.
The Researcher
Joshua Jade G. Corpus
Please put a check () on the following:

1. How many members are there in your household?
3 and below 4 6
79 10 and above
2. What is the combined monthly income of your family?
Php 3,000 and less Php 10,001 15,000
Php 3,001 5,000 Php 15,001 and more
Php 5,001 10,000
3. Where do you get your drinking water?
Household Tap water (faucet) Local sari-sari stores
Water stores/ Water station Grocery stores
4. Which existing nearby water refilling station do you patronize?
Agua Mega
Living Water
Agua Benida
5. What kind/s of drinking water do you buy?
Distilled Water Mineral Water
Purified Water Alkaline Water
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6. How often and how many galloons of drinking water do you usually buy for your
household? (1 container = 5 gallons)
Frequency Quantity
Once a week 1 - 2 container 3 -4 container.
5 6 container 7 8 container.
Twice a week 9- 10 container 11 and above container
7. How much do you spend for buying your drinking water per 5 gallons?
Php 25 29 per 5 gallons
8. If Water Refilling Station is established in your community which offers processed water, will
you patronize it?
Yes No
9. If yes, how often and how many gallons of Water Refilling Station are you willing to buy? (1
container = 5 gallons)
Frequency Quantity
Once a week 1 - 2 container 3 -4 container.
5 6 container. 7 8 container.
Twice a week 9- 10 container. 11 and above container
10. How much are you willing to pay for Water Refilling Station Purified Water per 5
gallons?
Php 25- 29 per 5 gallons

THANK YOU for sharing your precious time answering this questionnaire.
GOD BLESS YOU
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Exhibit 2
Unstructured Interview Questions
(Owners of Existing Water Refilling Stations)
Production
1. How long do you have been running this business?
2. Which do you think is better? Franchising or starting a new business name?
3. What made you choose this kind of business?
4. What particular water treatment do you apply? Why?
Financial
1. How much is the estimated capital investment for this type of business?
2. How much per gallon do you sell your products, and what mode of pricing
you used?
3. What are the requirements in terms of equipment, production, materials and
other facilities needed, and how much does each cost?
4. How do you compensate your employees? Did you provide training for them?
5. Where do you acquire the equipment used?
Organization
1. What is your set-up in terms of running a business?
2. How many personnel do you have? And what tasks are each assigned?
3. How did you hire them?
4. What are your daily plan activities in your store?
Marketing
1. What is your best way of attracting the customers?
2. What distinguished you from other water refilling stations|?
3. How were you able to keep your customers, patronizing your products?
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Chapter 2
MARKETING STUDY
This chapter discusses the marketability of the proposed project. It describes the
products and services to be offered, the market situation in the area, the industry profile,
the demand and supply situation, and the marketing plans of the proposed business.
A. Product Description
The proposed product of this business is Purified water. This product will undergo
the 12-stage intensive water purification process. Aqua Light Water Refilling Station will
sell them by refilling water gallons with Purified water.
B. Industry Profile
The proposed business will cover Matimbubong, Malipangpang, Pinaod,
San Ildefonso, Bulacan. It aims to provide a high quality product that is free from water
contamination. It is important to have safe and clean water. Nowadays, more than 5000
people die each year (1 death per hour) due to contaminated drinking water. The lack of
safe drinking water also stunts the growth of thousands of children per year. Waterborne
disease is a deadly disease which can be transmitted when contaminated water is
consumed. It was estimated that 88% of that burden is attributable to unsafe water
supply, sanitation and hygiene, and is mostly concentrated in children. Waterborne
disease can be caused by protozoa, viruses, or bacteria, many of which are intestinal
parasites. People who are infected by a waterborne disease are usually confronted with
related costs and always with a huge financial burden. A solution has appeared in the
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thousands of water refilling stations that now dot the Philippine landscape. It is a
requirement for all the water stations to abide with the provisions of the Department of
Health and be inspected every six months by the Department of Health personnel for
microorganisms and pass the product and facility test conducted at the end of the month
by a local government official to ensure its safety.
Range of price Php 25.00 40.00 per five gallons of purified water but it excludes
the price of a water container which has a price of Php125.00. Almost all of water stores
merely do refilling and sell bottled water for additional income. The delivery of water
gallons will be free of charge because it will attract customers.
Raw material to be used, which is water mainly came from the deep well. The
equipment used by most of the competitors is bought from Living Waters. Water
containers are sealed and label accordingly.
According to the UN Global Outlook Report of 2007, over one-third of all
humans worldwide will suffer from the lack of safe drinking water by 2025. Hence, It is
better to operate a water refilling station because it can help us minimize the risk of
diseases such as diarrhea, waterborne disease etc.
According to UNICEF WHO, Unsafe water causes 4 billion cases of diarrhea
each year, and results in 2.2 million deaths, mostly of children under five. This means
that 15% of child deaths each year are attributable to diarrhea a child dying every 15
seconds. In India alone, the single largest cause of ill health and death among children is
diarrhea, which kills nearly half a million children each year. Moreover, worldwide
infectious diseases such as waterborne diseases are the number one killer of children
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under five years old and more people die from unsafe water annually than from all forms
of violence, including war.
Though many in the Philippines benefit from the availability of water shops, the
system does not address the long-term water delivery and sanitation infrastructure
improvements necessary to provide reliable water to all. Hence, the government has
accepted private water shops as a necessary weapon in the fight against waterborne
disease and regulates their quality control practices and final product as much as possible.
However, given the large number of shops, it is difficult to adequately monitor the entire
industry.
The Proposed Business (Water refilling stations) can be a good source of safe
drinking water in the Philippines. Purified water can meet the aesthetic standards easily
detectable by the people in terms of taste, odor and color. The efficient water purification
processes can make the quality of water superior to the traditional water systems.
However, the risk of contamination is possible if the handling practices are not closely
monitored. Hence, the business will thoroughly polish perfection in handling water
purification to prevent water contamination.
The researchers also performed SWOT analysis for the animations products
retailing. It is the first stage of planning to focus on key issues in marketing. SWOT
stands for strengths, weaknesses, opportunities, and threats. Strengths and weaknesses are
internal factors. Opportunities and threats are external factors.
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For a practical assessment of the business, a SWOT analysis is done:
1. Strength
Water is a basic necessity, needed to maintain a healthy body, a clear
mind, and a good balance within your tissues. About 60 percent of your body is
water, and you must constantly replenish the supply, as it's used continuously in
the processes of life. The market is now considering the need for clean, pure and
beneficial water due to contaminants brought by industrialization, which has
brought the people to seek a more reliable source of drinking water.
2. Weakness
The potential weakness of this business is the inadequate qualified
personnel to operate the business. Moreover, if the demand of the product will be
the same as the result of the survey.
3. Opportunity
Since the population of the Philippines is fast increasing, the advertisement of
purified water in wider media may also help in promoting the business and the
awareness for the need for safe water is plus for the business.
4. Threats
The growing number of competitors is a threat to the propose business.
Moreover, the change in tastes of target customers might change in time.
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C. Demand
The researchers prospective target markets are the household population of
Matimbubong, Malipangpang, and Pinaod, San Ildefonso, Bulacan. Market segments
ranges from the lower class to upper middle class as these are the classes common in the
area. To estimate the future demands, the population for the past five years was gathered.
These were the bases for computing the trends and tendencies. Table 1 shows the
historical household population indicating the increases, and its percentages.
Table 1
Historical Population of Matimbubong,
Malipangpang and Pinaod, San Ildefonso, Bulacan
Increase Growth
Year Matimbubong Malipangpang Pinaod Population
(Decrease) Rate
2010 522 857 1145 2,524

2011 543 892 1192 2,627 103 4.08%
2012 565 929 1241 2,735 108 4.11%
2013 580 955 1275 2,810 75 2.74%
2014 611 1006 1345 2,962 152 5.41%
Total 2821 4639 6198 13,658 438 14.79%
Average 2,732 110 3.70%
Source of Historical Population: Barangay Hall of Matimbubong, Malipangpang and Pinaod,

San Ildefonso, Bulacan
As shown in the Table 1 the population increased in year 2014 by 5.41% due to
the increasing government housing project. The average increase from 2010 to 2014 is
3.70%.
Through the historical population, the researchers are able to arrive at the
projected population that is presented in the Table 2, the computation is clearly presented
in the Appendix 1, the statistical straight-line method is used to arrive at the table below.
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Table 2
Projected Population of Matimbubong,
Increase Growth
Year Population
(Decrease) Rate
2015 3,106
2016 3,256 150 4.82%
2017 3,405 150 4.60%
2018 3,555 150 4.40%
2019 3,705 150 4.21%
Total 17,026 600 18.03%
Average 3,405 150 4.51%
Source: Appendix 1
By using the statistical straight-line method the researcher where able to project
the population from 2014 to 2019, it is estimated to have an increase of 150. The
population on the year 2014 is assumed to be the year-end population and will be used for
the computation of the demand and supply analysis on the year 2015.
From the 70 survey questionnaire given there were 56 or 80% respondents who
are willing to avail the proposed product. Table 3 shows the projected annual demand in
quantity for the proposed product. The percentage of those who are willing to patronize is
then multiplied by the projected population annually. The product is then multiplied by
the percentage of frequency and by the percentage of quantity. Then multiplied again by
the averaged quantity, and then converting the product annual amount to arrive at the
projected demand. Detailed computation is presented in Appendix 2. The annual demand
in quantity will have a yearly increase of 21,799, and an average growth rate of 5%.
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Table 3
Projected Annual Demand in Quantity per Container
Demand in Increase Growth

Year
Quantity (Decrease) Rate
2015 452,130
2016 473,965 21,835 5%
2017 495,655 21,689 5%
2018 517,490 21,835 4%
2019 539,325 21,835 4%
TOTAL 2,478,565 87,194 18%
Average 495,713 21,799 5%
Table 4 shows the projected annual demand in peso which is computed by
multiplying the demand in quantity by the average price per container and by the average
inflation rate.
Table 4
Projected Annual Demand in Peso

Year Price Demand in Peso
2015 452,130 33 14,743,605
2016 473,965 34 16,073,852 1,330,247 8.28%
2017 495,655 35 17,481,795 1,407,943 8.05%
2018 517,490 37 18,981,995 1,500,200 7.90%
2019 539,325 38 20,574,240 1,592,245 7.74%
Source: Appendix 3
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D. Supply
Based on the survey questionnaire and unstructured interview as of the time the
research was conducted there two indirect competitors and one direct competitor which is
Agua Mega that offers Purified water. An opportunity was acknowledged in the
prospective location of the proposed project since it has considerable distance from the
competitors.
Supply in quantity is computed by the same procedure as computing the demand
in quantity, the difference is with the percentage, which is based from the result of the
survey questionnaire found in Exhibit 4.
Table 5
Projected Annual Supply in Quantity per Container
Supply in Increase Growth

Year
2015 408,736
2016 428,476 19,739 5%
2017 448,084 19,608 5%
2018 467,823 19,739 4%
2019 487,562 19,739 4%
TOTAL 2,240,681 78,826 18%
Average 448,136 19,706 5%
Source: Appendix 4
The projected annual supply in peso is shown in Table 6, to arrive at such amount
the supply in quantity is multiplied by the average price and the average inflation rate.
Table 6
Projected Annual Supply in Peso
Year Price Supply in Peso
2015 408,736 33 13,392,333
2016 428,476 34 14,600,661 1,208,328 8.3%
2017 448,084 35 15,879,564 1,278,903 8.1%
2018 467,823 37 17,242,268 1,362,704 7.9%
2019 487,562 38 18,688,582 1,446,313 7.7%
Source: Appendix 5
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E. Demand and Supply Analysis/Market Share
The proposed Aqua Light Purified Water Refilling Station Business will be
established within the target market, a business that provides drinking water for the health
of the target market. Here they can find service that they will surely be satisfied.
Table 7 identifies the market share of the proposed project through the analysis of
its demand and supply.
Table 7
Demand and Supply Analysis in Quantity per Container
Demand in Supply in Annual Market

Year Percentage Percentage Unmet Percentage
Quantity Quantity Capacity Share %
2015 14,743,605 100% 13,328,570 90.4% 1,415,036 9.6% 847,839 60%
2016 16,073,852 100% 14,531,145 90.4% 1,542,708 9.6% 881,753 57%
2017 17,481,795 100% 15,803,959 90.4% 1,677,837 9.6% 917,023 55%
2018 18,981,995 100% 17,160,175 90.4% 1,821,820 9.6% 953,704 52%
2019 20,574,240 100% 18,599,603 90.4% 1,974,638 9.6% 991,852 50%
Source: Table 3 and Table 5
The demand in Table 3 and the supply in Table 5 were used to compute unmet
demand. The market share, on the other hand, is computed by dividing the business
capacity by the derived unmet demand
Table 8 shows the demand and supply in peso of the proposed business for the
first 5 years of operation.
Table 8
Demand and Supply Analysis in Peso
Demand in Supply in Annual Market

Year Percentage Percentage Unmet Percentage
Quantity Quantity Capacity Share %
2015 14,743,605 100% 13,392,333 90.8% 1,351,273 9.2% 851,895 63%
2016 16,073,852 100% 14,600,661 90.8% 1,473,192 9.2% 885,971 60%
2017 17,481,795 100% 15,879,564 90.8% 1,602,232 9.2% 921,410 58%
2018 18,981,995 100% 17,242,268 90.8% 1,739,727 9.2% 958,266 55%
2019 20,574,240 100% 18,688,582 90.8% 1,885,659 9.2% 996,597 53%
Source: Table 4 and Table 6
27
Analyzing the table, it shows that the proposed business has an average market
share. The business will not increase its capacity in quantity.
F. Marketing Plans
Marketing Strategy Plan is constructed to identify business alternatives, establish
challenging goals, determine the optimal marketing mix to attain these goals, and detail
implementation. This helps attract customers and gain more investors. Moreover,
determines the failure and the success of the brand. The following are the marketing
plans and strategies that will be used in the proposed business, based on the five P's of
marketing mix.
1. Product
The product to be offered is ensured to have a superior quality. Superior
quality product will initiate from the selection of the equipment that has exquisite
and quality operating performance, workers that are skillful and friendly towards
the customers, to the pricing methods used.
2. Pricing
The researcher decided to use the cost-plus method of pricing due to its
simplicity and applicability to the proposed product. Factors like freight expense,
competitors, location are considered to arrive at the cost of the product and to
achieve the desired and reasonable mark-up for every product.
28
3. Promotion
To be able to gain prospective customers, effective promotion is very
essential to help businesses build a good image and familiarity among customers.
The promotions of the business will specifically portray the benefits that
customers will obtain and it shall in itself emphasize the business and the services
that are rendered. Banners and flyers will be placed in surrounding areas to
increase the level of awareness among the prospective customers. The place will
also contribute for promotion because many people go to market every day.
Word-of-mouth advertising shall be encouraged among customers as it is an
effective method of promoting the business. Php 5,000 will be allocated to the
advertisement expense yearly.
4. People
Personnel that will be hired shall get proper introduction and training
about the flow of production process. They should have a pleasing personality as
to deal pleasantly with the customer as they work with other employees.
Employees and staff shall receive a reasonable salary and compensation for their
work as prescribed by government.
5. Place
The proposed place of the business is beside the highway where a lot of
people and vehicle are passing by. The location can be accessible without
difficulty by prospective customer so they may avail the product easily.
29
Exhibit 3
Result of Survey Questionnaire
Frequency Percentage
1. How many members are there in your household?
3 and below 13 18%
46 39 56%
79 16 23%
10 and above 2 3%
Total 70 100%
2. What is the combined monthly income of your family?
Php 3,000 and less 5 7%
Php 3,001 5,000 13 19%
Php 5,001 10,000 27 39%
Php 10,001 15,000 20 28%
Php 15,001 and more 5 7%
Total 70 100%
3. Where do you get your drinking water?
Household Tap water (faucet) 25 36%
Water stores/ Water station 45 64%
Total 70 100%
4. Which existing nearby water refilling station do you patronize?
Agua Mega 12 27%
Living Water 19 42%
Agua Benida 14 31%
Total 45 100%
5. What kind of drinking water do you buy?
distilled water 15 33%
purified water 4 9%
mineral water 15 33%
alkaline water 11 25%
Total 45 100%
30
6. How often and how many galloons of drinking water do you usually buy for your
household?
Frequency
Once a week 30 67%
1 2 container 7 23%
3 4 container 18 60%
5 6 container 5 17%
7 8 container 0 0%
9 10 container 0 0%
11 and above container 0 0%
30 100%
Twice a week 15 33%
1 2 container 7 47%
3 4 container 8 53%
5 6 container 0 0%
7 8 container 0 0%
9 10 container 0 0%
15 100%
Total 45 100%
7. How much do you spend for buying your drinking water per container (1 container = 5
gallons)?
Php 25 29 per container 10 22%
Total 45 100%
8. If Water Refilling Station is established in your community which offers processed water, will
you patronize it?
Yes 56 80%
No 14 20%
Total 70 100%
31
9. If yes, how often and how many gallons of Water Refilling Station are you willing to
buy? (1 container = 5 gallons)
Frequency
Once a week 36 64%
5 6 container 4 11%
7 8 container 0 0%
9 10 container 0 0%
36 100%
Twice a week 20 36%
3 4 container 3 15%
5 6 container 0 0%
7 8 container 0 0%
9 10 container 0 0%
20 100%
Total 56 100%
10. How much are you willing to pay for Water Refilling Station Purified Water per
container (1 container = 5 gallons)?
Php 25- 29 per container 14 25%
Total 56 100%
32
Exhibit 4
Results of Interview Questionnaire
Interview with Dora Reyes Owner of Dora Purified Drinking Water
What particular water treatment do you apply? Why?

We are using a water treatment process that has 16 stages. We are not familiar
with all these stages but some of it that we are known to us includes carbon filtration,
reverse osmosis, etc. thats what actually separates us from other water refilling stations.
Of course, you can establish a water station with even just reverse osmosis then tag your
product as purified water but the process is not rigorous enough to really call it purified
water.
Which do you think is better? Franchising or Starting a new business name?

Starting a new business name is better.
How much per gallon do you sell your products, and what mode of pricing you
used?
We sell it for 35Php. Thats the prevailing market price.
Where do you acquire the equipments used?

I bought them through my friends connections. Basic needs include sealer,
bottles, and the purifying unit. Filters are being replaced every six months; the smaller
ones are replaced twice every month.
How many personnel do you have? And what tasks are each assigned?
We have 2 workers inside the store which prepares the product to be delivered
and 1 worker outside which do the delivery of the product through our customers.
What is your best way of attracting the customers?

We offer them quality and we also have promos like freebies. We give out
umbrellas during Christmas, ball pens, things like that.
33
Interview Ms. Elizabeth Apulado from Aqua Puro Water Station
How long do you have been running this business?

Almost 2 years of operation
Which do you think is better? Franchising or starting a new business name?

Franchising is much better.
What made you choose this kind of business?

In my Area there are fewer competitors and also when I had a study more
people demand of this product. Moreover, theres a lot more benefits that the
profits. Plus, its easy to manage.
How much per gallon do you sell your products, and what mode of pricing you
used?
We are selling according to market division close to the standard price. 35
each gallon with free delivery charge.
How much is the estimated capital investment for this type of business?
All in all, a minimum of 500,000.00 for the equipment and renovation of
the building would be good enough. That does not cover the budget for vehicle
and compensation for employees.
What is your set-up in terms of running a business?

It is fluid. Everybody does the task that is waiting except for the driver. He
is not allowed inside the store except of course, after work.
How did you hire them?

They were referred to me by my friends. Since the task was simple, no
rigorous requirements were asked.
What distinguished you from other water refilling stations?

We are only offering Purified water
34
Chapter 3
TECHNICAL STUDY
This chapter focuses on the study of the technical aspects of the business which
includes the business flow of service, the building which will house the business and its
related floor plan. Also found in this chapter are the sections discussing the equipment
and the furniture and fixtures needed by the business, the capacity and scheduling
scheme, the waste disposal policy of the business, the utilities and operating costs of the
business and the cost of providing services to customers. This chapter will prove that the
business can provide services to the customers at a reasonable cost in the proposed
location.
A. Production Process
The process will include the making of Purified water can be divided in 5 steps:
1. Receiving of Order, getting customers order through customers interaction or
through cell phone.
2. Water Purification Process means that the water in the raw tank goes through
the machine in which the water will undergo the stages of water purification.
a) Stage 1: Sediment Filtration. Our complex purification process begins with
a simple, pleated-paper sediment filter. This Filter raps relatively large
particles which may be present in the water-things like dirt, sand, slime and
grit. Moreover, it also removes these large particles which could foul or clog
the more sensitive equipment used in later stages.
b) Stage 2: Ion Exchange. It is the removal of various metallic elements through
a process known as ion exchange. Sometimes referred to as water softening,
ion exchange utilizes a large tank which is filled with a special, negatively-
35
charged resin. The resin beads serve as bases or sites for the ion exchange to
actually take place.
c) Stage 3: Activated Carbon Towers. Once the water passes through the ion
exchange system, it moves into over-sized granular activated carbon beds.
Carbon filtration (also known as charcoal filtration), which utilizes a process
known as adsorption, is a particularly effective technique for chlorine
removal. Pesticides, herbicides, and other organic contaminants (especially
volatile organics) are also removed at this stage.
d) Stage 4: Ultraviolet Light #1. The ultraviolet light at this particular
wavelength destroys the genetic material within these organisms, eliminating
the possibility of bacterial or viral reproduction and proliferation. The
organisms quickly die and are captured and removed during the pre-filtering
before the reverse osmosis purification process.
e) Stage 5: One Micron Pre-Filter. A 1 Micron filter is capable of removing
viruses, bacteria, cryptosporidium and various other deleterious bugs.
f) Stage 6 & 7: Two Passes of Reverse Osmosis. In reverse osmosis, high
pressure is used to force water across a membrane while impurities are left
behind. In other words, the high pressure causes the impurities to become
more concentrated on one side of the membrane. Only the pure water is able
to cross the membrane; even the dissolved impurities which cannot be
removed by conventional filtration are captured and eliminated.
g) Stage 8: Ozonation. Ozonation relies on oxygen to ensure that our purified
water remains free of any possible microbiological contamination.
36
h) Stage 9: More Ultraviolet Light. We have yet another ultraviolet light that
the water must pass through before reaching our stainless steel storage tanks.
i) Stage 10: More Ozonation. Ozone is a very powerful disinfectant and is
capable of oxidizing a very broad range of contaminants. In fact, ozone is
highly effective against many types of impurities and organisms, such as
cryptosporidium, that are utterly impervious to chlorination.
j) Stage 11: Storage, Ozonation & Recirculation. Our storage tanks are
stainless and our pumps are stainless. Moreover, the water continuously
travels through a recirculation loop. During recirculation, additional ozone is
periodically added to maintain the completely sterile and bacteria-free
condition of the system. These little babies are flow cells which continually
sample our storage tanks on a 24/7 basis. Inside these flow cells are sensors
which monitor and control different variables like ozone concentration, PH,
conductivity, etc. The sensors feed the data to our analyser panel where the
data is displayed and recorded again on a 24-7 basis.
k) Stage 12: Bottling Process. The water is drawn directly from the continuous
recirculation loop and fed to our bottling system.
4. Packaging means the water that already goes through the water purification
system, be put to a container and be labeled.
5. Delivery means the product will be delivered to the customers through direct and
indirect services.
37
RECEIVING OF ORDER
WATER PURIFICATION PROCESS
PACKAGING
DELIVERY
Figure 1
Production Process Flowchart
B. Equipment, Machine, Furniture and Fixture
To attain high quality product, the equipment that will be used in processing the
water should be modern and of high quality, especially the water purification machine. In
every production activity, the worker will be given guidelines to clean the equipment &
machine after using to ensure a longer life span quality and hygiene of the finished
product. The equipment, machinery, furniture and fixture used in the production activity
and office activity Aqua Light Purified Water Refilling station consist of booster pump,
38
raw water tank, 12 stages purified water purifying machine, electric fan, wall clock,
calculator, panaflex sign, table, chairs, delivery equipment, cell phone, garbage bin. The
decrease in the service potential of capital assets invested in a business venture, resulting
from such causes as physical wear and tear in ordinary use, as in the case of machinery,
deterioration primarily by action of the elements, reducing the quality of the building. All
of this depreciation reduces the value of an original value of the item. The recommended
equipment, machinery, furniture and fixtures are presented below together with the
depreciation in Table 9
Table 9
Equipment, Machinery, Furniture and Fixture List
Total
Particulars Specification Quantity Price Amount Life in years Depreciation/ Year
Equipment and Machinery
Purified Water
Machine AWT 1 250,000.00 250,000.00 20 12,500.00
Electric Fan Hanabishi 1 750.00 750.00 5 150.00
Panaflex Sign Store Sign 1 5,000.00 5,000.00 10 500.00
Cellphone Nokia 2 1,200.00 2,400.00 5 Expensed Outright
Multi-Cab Suzuki 1 65,000.00 65,000.00 10 6,500.00
Dryer/Heat
Gun National 2 1,200.00 2,400.00 5 Expensed Outright
Total 323,150.00 325,550.00 19,650.00
Furniture and Fixture
Trash Can Omegaware 1 300 300 5 Expensed Outright
Calculator Casio 1 200 200 5 Expensed Outright
Wall Clock Seiko 1 300 300 5 Expensed Outright
Chair Uratex 2 300 600 5 Expensed Outright
Table Uratex 1 1,700.00 1,700.00 5 Expensed Outright
Total 2,800.00 3,100.00 -
TOTALS 325,950.00 328,650.00 19,650.00
Source: Advance Water Technology Corporation, Ace Hardware, SM Appliance, Sulit.com.ph,
OLX.com, www.nokia.com
39
C. Building
Since, constructing a building is much more costly. The researchers decided to
rent one. The space to be rented is located at 908 Venturina Street Matimbubong, San
Ildefonso, Bulacan which is rented for Php 2,500 a month or Php 30,000 a year. The
researcher also decided to have a minor renovations which will cost Php 25,000.00 due to
sanitary and production purposes.
Table 10
Bill of Materials
Particulars Quantity Unit Price Amount

Cement 50 225.00 11,250.00
Ch#4 250 9.00 2,250.00
Sand 58 20.00 1,160.00
Gravel 50 10.00 500.00
PVC 1/2 4 65.00 260.00
PVC 3/4 6 85.00 510.00
112mm Round Bar 25 245.00 6,125.00
10mm Round Bar 10 160.00 1,600.00
8mm Round Bar 9 105.00 945.00
Tire Wire # 16 5 80.00 400.00
Total 25,000.00
D. Location
The proposed project will be located 908 Venturina Street Matimbubong, San
Ildefonso, Bulacan. The researchers have considered a lot of advantages the proposed site
offers that would contribute significantly to the companys progress. It is situated near the
highway, so deliveries could be effective. Besides that, the location is near from houses
and subdivision which is our target market.
40
E. Layout/Floor Plan
The floor plan was especially designed to provide the appropriate needs of the
workers during operation of the business. Convenience was given the highest priority so
that productivity would be attained. The building floor area is 8 x 5 meters, giving a total
of 40 square meters.
F. Capacity/Scheduling
The proposed business will be open from Sunday to Friday including holidays.
The employees will work on a regular shift which is 7:30 am 12:00 nn and 1:00pm
5:30pm, considering a one hour lunch break. Because most of the process was done by
machine, the proposed business will require only one shift.
Table 11
Production Schedule of Aqua Light Purified
Water Refilling Station
Date Time Activities

Sunday 7:30-7:45 Preparation Time- Cleaning
7:46-12:00 Production of Product
12:01-13:00 Lunch Break
17:16-17:30 Preparation to go Home
Monday 7:30-7:45 Preparation Time- Cleaning

Tuesday 7:30-7:45 Preparation Time- Cleaning

41
Wednesday 7:30-7:45 Preparation Time- Cleaning
Thursday 7:30-7:45 Preparation Time- Cleaning

Friday 7:30-7:45 Preparation Time- Cleaning

G. Waste Disposal
There will be no allocation of cost for disposing the waste product. Since the
production process will not result to hazardous waste product. The only waste would be
plastics and defective containers due to defective packaging. These waste materials
would be disposed in a large garbage bin and will be given to recycling firm. Since the
business deals with drinking water, cleanliness of the area shall be strictly observed.
H. Utilities and Other Costs
The proposed business will incur utilities and operating costs that are necessary to
the business operations. Water was not included as an expense because the business will
be using its own deep well. The cost for the utilities includes telephone expense,
electricity and water shown in Table 12 below.
42
Table 12
Utilities Expenses
Utilities Expense Monthly Expense Annual Expense

Telephone Expense 300.00 3,600.00
Electricity 500.00 6000.00
Water - -
Total 800.00 9,600.00
The operating costs consist of advertising, salaries, and benefits, depreciation
expenses, rent and office supplies. Office supplies will cover the cost of the labels that
will be put on the refilled water containers and the seals that will ensure quality and
safety of the product. Advertising expense intends to introduce the product to the target
market. The repair and maintenance will include the allocated amount for the
preservation of the service quality of the machinery and equipment. The operating
expense is summarized in the Table 13.
Table 13
Operating Cost
Outright Expense 7,900

Advertising Expenses 2,000
Pre-operating Expenses 6,500
Salaries & Benefits 189,994
Accountant's Fee 20,000
Rent Expense 30,000
Office Supplies 3,000
Repair and Maintenance 5,000
Utilities Expense 9,600
Renovation Cost 25,000
Depreciation Expenses-Equipment and
19,650
machinery
Delivery Expense 12,000
Total Operating Expenses 330,644
43
I. Production Costs
Interviews with the operators of same products and sample costs given by such
owners provided the data for the projected daily manufacturing costs of Aqua Light
Water Refilling Station. Using this data, the researchers computed the production costs to
be incurred by the proposed project relative to its capacity and production schedule. The
yearly production cost incurred in processing the product is presented in Table 14.
Table 14
Production Cost
Production Cost
2015 2016 2017 2018 2019
Direct Materials
Water cost per container 0.42
0.38 0.40 0.43 0.45
Direct Labor
Worker
106,380.00 106,380.00 106,380.00 109,980.00 113,724.00
Divide by capacity in quantity
15,600.00 15,600.00 15,600.00 15,600.00 15,600.00
Direct Labor Cost per unit 6.82
6.82 6.82 7.05 7.29
Manufacturing Overhead
Electricity
6,000.00 6,240.00 6,489.60 6,749.18 7,019.15
Divide by capacity in quantity
15,600.00 15,600.00 15,600.00 15,600.00 15,600.00
Manufacturing Overhead per
0.42
unit 0.38 0.40 0.43 0.45
Total Cost per unit

7.59 7.62 7.65 7.92 8.19
Yearly(x12)
118,380.00 118,860.00 119,359.20 123,478.37 127,762.30
44
Exhibit 5
Picture of Equipment
CELLPHONE
ELECTRIC FAN
45
HEAT GUN
CALCULATOR
46
MULTICAB
WALL CLOCK
47
TABLE
CHAIR
48
TRASH CAN
49
Exhibit 6
Map of the Philippines
50
Exhibit 7
Map of Bulacan
51
Exhibit 8
Map of San Ildefonso
52
Exhibit 9
Vicinity Map
53
Exhibit 10
Floor Plan/Layout
54
Exhibit 11
Picture of Proposed Building
55
Exhibit 12
Picture of Jet Pump
56
Exhibit 13
Picture of Purified Machine
57
Exhibit 14
Picture of the Proposed Logo
58
Chapter 4
ORGANIZATION AND MANAGEMENT STUDY
This chapter discusses the form of business organization the proposed business
will adopt, the organizational structure, the number of personnel needed, their
qualifications, their compensation and the projected time table before the implementation
of the project. Organization and management schemes of the proposed project in
attaining organization effectiveness and efficiency are discussed.
A. Form of Business Organization
The proposed business will be registered as sole proprietorship. Sole
proprietorship is the simplest form of business organization to use and manage since it is
owned by one person. It will exist within the campus but as a separate enterprise.
(Sourcehttp://www.smallbusinessnotes.com/operating/legal/proprietorship).
The advantages of are:
Easiest and least expensive form of ownership to organize. Decisions can be
easily made, and the owner makes them. In sole proprietorship business the proprietor
has full control over each and every activity of the business. The owner is entitled to all
the profits the business realizes. The business is easy to dissolve, if desired, and the sole
proprietor is always in a position to maintain good personal contact with the customers
and employees. Direct contact helps the sole proprietor to know the individual likes,
dislikes and tastes of the customers. It also helps in maintaining close and friendly
relations with the employees and thus, the business can run smoothly.
59
B. Organizational Structure
The organizational structure presents the flow of authority and responsibility from
the manager down to the line staff. Figure 2 shows the organizational structure of the
business.
Manager
Accountant
Worker Delivery Boy
Figure 2
Organizational Chart
The manager which is the owner will be in charge for the overall decisions in
governing the affairs of the business. Planning, supervision and execution of the
development of the business programs is also handled by the manager. The manager will
also take the role of the cashier.
The accountant is responsible for the preparation of the financial statement,
especially for tax purposes will be employed annually or as the need arises.
The worker will take orders from text messages and from the window pane, which
in some cases may act as a cashier if the need arises. The primary task of the worker is
dealing with the whole process of the production; it will be the workers responsibility to
60
supervise the operation of the equipment. Maintenance and sterility of the area is also the
workers job.
Accessing the product to the specific address of the customers will be the delivery
boys prime task and collecting the cash from the customer with the corresponding
receipt.
C. Personnel Requirement
In any business organization effective and efficient performance of every
personnel in their assigned task is a vital aspect. Because the business is small, only a few
numbers of personnel will be required. There will be a need of a manager, a worker and a
delivery boy. This general assumption will be observed for the first five years of the
operation, unless the need for increasing or decreasing the number of employees arises.
D. Qualification Standards
In starting a business assigning the right people at the right position is one of the
fundamental necessities. Thus having qualification standard for the employees will help
in the fulfillment of the business success and continuity. The required qualification
standards are as follows:
61
Table 15
Summary of Qualification Standards
Job Position Personal Requirements Experience Academics
Goal oriented
Has sufficient knowledge in There will be no A college
managing a business required since the graduate and has
Manager Responsible
owner will act as a background in
Risk taker
the manager. managing.
Exercise good judgment
Strong dedication
Pleasing personality No experience
Willing to learn will be needed
Cooperative to other since the worker At least a high
Worker employee will undergo school graduate.
Hard-working training before the
starting to work.
Has a pleasing personality A high school
Punctual at all times At least 1 year graduate and has
Delivery Boy Has good communication experience. a drivers
skills
license.
Clean an decent look
E. Compensation Package
In determining the salaries to be given to regular employees, the researcher
considered the companys policy on salaries and benefits, ongoing community rate, labor
rates and fringe benefits based on existing labor laws, and workers duties,
responsibilities, and qualifications.
A regular employee shall receive a minimum wage rate as prescribed by the
government regulation. The salary will include a completed health benefits. Phil Health,
PAGIBIG, Social Security Benefits and the 13th month pay every 1st week of December
62
as regulated by the Department of Labor and Employment shall also be given to the
employee.
The summary of monthly compensation package is presented in Table 16. Gross
monthly salary comprises of the basic salary per month and the benefits which includes
the SSS, Phil health, PAGIBIG and EC.
Table 16
Gross Monthly Salary and Benefits
Employer's Contribution
Basic Monthly Benefits Gross Monthly
Job Position
Salary Salary
SSS Phil Health PAGIBIG EC
Worker 7,500.00 530.00 100.00 100.00 10.00 8,240.00

Delivery Boy 7,000.00 494.70 100.00 100.00 10.00 7,704.70
Total 14,500.00 1,024.70 200.00 200.00 20.00 15,944.70
The net monthly salary is shown in the Table 17. Where in the gross monthly
salary is decreased by the monthly deduction which composed of the SSS, PAGIBIG and
the Phil health Fund to arrive at the net monthly salary.
Table 17
Net Monthly Salary
Gross Employee's Contribution Net

Total
Job Position Monthly Monthly Deductions Monthly
Deductions
Salary SSS Phil Health PAGIBIG Salary
Worker 8,240.00 250.00 100.00 100.00 450.00 7,790.00
Delivery Boy 7,704.70 233.30 100.00 100.00 433.30 7,271.40
Total 15,944.70 483.30 200.00 200.00 883.30 15,061.40
63
The gross monthly salary is then multiplied by 12 months to arrive at the annual
net pay as illustrated in Table 18.The thirteenth month pay is given to the employees
which is equivalent to the basic monthly salary for the same year. The annual
compensation package is then arrived after considering the thirteenth month pay.
Table 18
Annual Compensation Package
Gross Annual
Annual 13th Month
Job Position Monthly Compensation
Gross Pay Pay
Salary Package
Worker 8,240.00 98,880.00 7,500.00 106,380.00

Delivery Boy 7,704.70 92,456.40 7,080.00 99,536.40
Total 15,944.70 191,336.40 14,580.00 205,916.40
The projected increase in the compensation package is shown in Appendix 6, where there
is a 4.4% of increase starting 2018 until 2019.
F. Projected Timetable
Timetable is important in establishing the business as it is the plan or schedule that
will be followed so that the target time for the commencement of the business will be
met. For efficient purposes, careful planning of the procedural steps must be considered.
This includes the time and financial budget for the pre-operating period for the
preparation of the actual operation.
64
The researcher designed the following steps to hasten implementation of the project
smoothly:
1. Feasibility Preparation
Preceding the establishment of the proposed business the researchers have
conducted survey indicating the probable potential of the business. This includes
the studying of the location, competitors, marketing strategies, source of
financing, etc. This is done within two months and the budget for this feasibility
study is Php 5,000.00.
2. Formal Organization
The second month will be the allocated time in application for registration,
business permit, licenses, business name and other legal things that are necessary
for the formalization of the business to operate.
3. Leasing of Building
The researchers ascertain that renting a building in Matimbubong, San
Ildefonso, Bulacan would be advantageous for the proposed business. The time
span for the processing and settling to an agreement would be in a month.
4. Renovation of the place
Renovations will be done for the place, to be appropriate for the proposed
business. The third and the fourth month will be allocated for renovation purposes
with the budget of Php 25,000.00.
65
5. Acquisition equipment and recruitment of workers
Acquisition of the equipment and other necessary furniture and fixture and
recruitment of the workers will be done on the fourth to fifth month to ensure the
proper selection of equipment and workers. Installation of the equipment and
testing will be done on the fifth month before the proper operation of the business.
6. Promotion
Extensive promotions are necessary for the proposed business be known in
the market. The promotion activities will involve persuading the target market to
patronize the product offered, putting banner along the way and fliers will be
given in the vicinity of the target market. These activities will need a budget of
Php 5,000.00
7. Start of the Operation
The sixth month will be the start of the operation of the business. This is
the commencement of offering the Aqua Light Purified Water Refilling Station
product to public.
Months
Activities
1 2 3 4 5 6
1. Feasibility Preparation
2. Formal Organization
3. Leasing of Building
4. Renovation of the place
5. Acquisition of equipment and recruitment of
workers
6. Promotion
7.Start of the Operation
Figure 3
Aqua Light Purified Water Refilling Station Gantt chart
66
Chapter 5
FINANCIAL STUDY
This chapter discusses the following: major assumptions, capital requirement,
sources of funds, and the financial statement preparation and analysis.
A. Major Assumptions
The researchers employed major assumptions in projecting the financial
statements of the proposed business. These assumptions are based on the data gathered
from the survey questionnaires, interviews, and figures assembled by statistical reports
associated to the industry. In the process of preparing the financial statement for the
proposed project, several assumptions were made:
1. Sales
The sales for each of the five years are obtained from demand and supply
analysis of each of the route. The increase will be according to the market share and
the market share would increase according to the increase of population. The selling
price will increase by 4% annually which is the average inflation rate. For the first
year, total sales will amount to Php 508,703.00.
2. Cost of sales
The cost of sales will refer to the discussion of production and operating cost
in the technical study of this book.
67
3. Salaries and benefits
The employees salary and benefit will amount to Php 205,916.40 for the first
year and amount of Php 20,000 as professional fee for the accountant. An increase of
4% will be applied be to the salaries starting the 4th year.
4. Rent Expense
The total rent expense for the initial operation will be Php 30,000.00 and it
will be adjusted based on the inflation rate for the succeeding years.
5. Advertising Expense
There will be a budget of Php 2,000.00 for the initial operation. The manners
of advertisement that will be utilized for the proposed project are presented in the
marketing study.
6. Utilities Expense
Among the utilities and other miscellaneous expense are the following; the
telephone and electricity. The water supply of which are necessary to the business
operations are not included in the expense because deep well will be used in this
project. In the first year, there will be a total of Php 9,600.00 of utilities expense.
7. Repair and Maintenance Expense
For the preservation of the service quality of the machinery and equipment there
would be an allocation of Php 5000.00.
68
8. Depreciation expense
The straight line method of depreciation will be used in arriving at the
depreciation expense. Based on the discussion in the technical study the annual
depreciation for the equipment and furniture and fixtures will be Php 19,650.00 for
the first year.
9. Renovation cost
The renovation cost that will be incurred is estimated to be Php 25,000.00.
10. Withdrawal
The owner of the business is entitled annually to withdraw 5% of net income
starting the 4th year. The resulting amounts of withdrawal are allocated to enable the
owner to meet his personal obligations as well as his personal needs and wants.
B. Capital Requirement
The capital requirement is estimated by the researcher through interviews and
inquires and did an approximation on the preliminary project cost. The primary
investment on the capital requirement includes pre-operating expenses, operating
expenses/working capital, and capital expenditure. The computation of these costs is
shown in Table 19. It shows a total capital requirement of Php 430,529.00.
Pre-operating Cost
Table 19
Particulars Amount
Feasibility Study 5,000
Application for Business Name 500
City Permit 500
Sanitary Permit 500
Total 6,500
69
Operating/WorkingCapital
Particulars Amount
Utilities(3 months) 2,400
Salaries(3 months) 51,479
Miscellaneous 5,000
Advertising/Promotion 2,000
Office Supplies 2,000.00
Rent(3 months) 7,500
Total 70,379
Capital Expenditures
Particulars Amount
Equipment and Machinery 325,550
Furniture and Fixture 3,100
Renovation Cost 25,000
Total 353,650
Total Capital Requirement 430,529
C. Source of Financing
The manner of financing that will be used is by 100% investment, thus
making other sources of financing inapposite. The projected business will be
financed by Mrs. Arlene May G. Corpus. Exhibit 16 attests the financial
availability of the proposed business.
D. Preparation of Financial Statements
Financial statements show the results of the financial condition of this
proposed project, projected for five years.
1. Projected Income Statement
The income statement will present the projects total revenue, the total cost, and
the net income for each year for the next five years of the operation. Schedule 1
70
shows the revenues earned and expenses incurred and the gain or loss, which are the
result of operation of this project for five years. First year of the operation will result
a net income of Php 135,610 with an increasing number each year.
Net Income Graph

250,000
200,000
150,000
100,000
Net Income After Tax
50,000
0
2015 2016 2017 2018 2019
Figure 4
Net Income Graph
2. Projected Cash Flow Statement
The statement of cash flow is a systematic presentation of cash receipts and
disbursement from the operating, investing, financing activities for the five years
period. The statement will show the available cash for every end of the year, which
will be the beginning cash for the next year of operation. Projected cash flow
statement is elaborately presented in Schedule 2.
71
Cash Flows
1,500,000.00
1,000,000.00
Cash Flows
500,000.00
0.00
2015 2016 2017 2018 2019
Figure 5
Cash Flow Graph
3. Balance Sheet
The balance sheet statement shows the financial position or condition of an
entity by means of listing the assets, liabilities, and owners equity at a particular
date. The information needed for the balance sheet items are the net balances at the
end of the period rather than the total for the period as in the income statement. The
financial condition of the business for the five year period is shown in the Schedule
3.
72
1,600,000.00
1,400,000.00
1,200,000.00
1,000,000.00
Assets
800,000.00
Liabilities
600,000.00 Owner's Equity
400,000.00
200,000.00
0.00
2015 2016 2017 2018 2019
Figure 6
Balance Sheet Graph
E. Financial Analysis
This study ascertains the profitability and feasibility of the proposed business,
which is significant in determining whether to accept or reject the proposal. The financial
tools used to analyze the financial capability of the proposed business are shown below.
Capital Budgeting Tools
a. Net Present Value (NPV)
The net present value is the excess of the present value of cash returns
discounted at a chosen cut-off rate over the amount of investment. This test
determines the net value of the proposed project in terms of todays peso. If computed
to be positive, the benefits are greater than costs, therefore if the NPV is greater than
0, it is acceptable but if not it must be rejected. The net present value of the proposed
business is Php 168,591.09 and is said to be acceptable. This implies that the rate of
73
return on the proposed investment is higher than the cut-off rate. The computation is
shown in Schedule 4.
b. Internal Rate of Return (IRR)
The rate of return that a long-term investment earns is 54.53%which is acceptable
the computation is clearly presented in Schedule 5.
c. Benefit Cost Ratio
This provides a comparative measure of an investment proposals desirability
by establishing the ratio between the present value of future net benefits and the
initial cost. A positive ratio shows that the projects gross benefits are greater than the
gross costs; therefore, it should be accepted. It is computed to have a 1.392:1 benefit
cost ratio. Schedule 8 shows how it is computed.
Financial Analysis Using Ratios
a. Profitability Ratios
These ratios are used to know whether the profits earned by the business
are enough compared to its invested assets. Return on Sales, Return on
investment, and Gross Profit Ratio. The computation shows a ratio of 0.338 for
return on sales, 0.410 for return on investment and 0.779 for gross profit ratio.
The computation is clearly presented in Schedule 6.
74
b. Test of Return on Capital Investment
These financial tests analyze the justification of investing money, time and
effort in the proposed project. The average rate of return and payback period in
years is used to the return on capital of the business. The results are favorable,
thus the project is pursued. The computation of the average rate of return and
payback period is presented in Schedule 7.The average rate of return of the
proposed business is 86.9%. A payback period of 2.58 years is expected in the
business.
75
Exhibit 15
Certificate of Financing
June 20, 2014
To Whom It May Concern:
This is to certify that I, Arlene Corpus is willing to invest an amount of four
hundred thirty thousand five hundred and twenty nine pesos (Php 430,529.00) in the
proposed business of Establishing Aqua Light Purified Water in Matimbubong, San
Ildefonso, Bulacan.
This certification is made for whatever legal purpose it may serve.
_____________________
Mrs. Arlene Corpus
Investor
76
Schedule 1
PROJECTED INCOME STATEMENT
Year 2015 2016 2017 2018 2019
Revenue 508,704 529,052 550,214 572,222 595,111
Cost of goods
produced
Raw materials 6,000 6,240 6,490 6,749 7,019
Direct Labor 106,380 106,380 106,380 109,980 113,724
Manufacturing Overhead 6,000 6,240 6,490 6,749 7,019
Total Costs of goods
produced 118,380 118,860 119,359 123,478 127,762
Gross Profit 390,324 410,192 430,855 448,744 467,349
Operating
Expense
Outright Expense 7,900 0 0 0
Advertising Expenses 2,000 2,080 2,163 2,250 2,340
Pre-operating Expenses 6,500 0 0 0 0
Salaries & Benefits 99,536 99,536 99,536 102,896 106,391
Accountant's Fee 20,000 20,000 20,000 20,000 20,000
Rent Expense 30,000 30,000 30,000 30,000 30,000
Office Supplies 3,000 3,120 3,245 3,375 3,510
Miscellaneous 5,000 5,000 5,000 5,000 5,000
Utilities Expense 9,600 9,984 10,383 10,799 11,231
Renovation Cost 25,000 0 0 0 0
Depreciation Expenses-
Equipment and machinery 19,650 19,650 19,650 19,650 19,650
Delivery Expense 12,000 12,480 12,979 13,498 14,038
Total Operating Expenses 240,186 201,850 202,957 207,468 212,159
Net Income before
Tax 150,137 208,341 227,898 241,276 255,190
Basic Personal
Exemptions 50000 50000 50000 50000 50000
Net Taxable Income 100,137 158,341 177,898 191,276 205,190
Tax due 8,500 22,500 22,500 22,500 22,500
amount in excess
of140,000 70,000.00 30,137
140,000.00 18,341 37,898 51,276 65,190
tax rate 20% 25% 25% 25% 25%
Additional Income
Tax 6,027 4,585 9,474 12,819 16,297
Net Income Tax 14,527 27,085 31,974 35,319 38,797
Net Income After
Tax 135,610 181,256 195,923 205,957 216,392
77
Schedule 2
PROJECTED CASH FLOWS
2015 2016 2017 2018 2019

Cash Flow from
Operating Activities
Net Income 135,609.70 181,256 195,923 205,957 216,392
Increase in Inventory 0.00 0.00 0.00 0.00 0.00
Depreciation Exp-
Macinery&Equipment 19,650.00 19,650.00 19,650.00 19,650.00 19,650.00
Depreciation Exp-
Furniture and fixtures 0.00 0.00 0.00 0.00 0.00
Increase in Income
Tax Liability 14,527.42 12,558 4,889 3,345 3,478
Net Cash From
Operating Activities 169,787.12 213,463.84 220,462.25 228,951.73 239,520.80
Cash Flow from
Investing Activities
Acquisition of
Equipments and
kitchen utensils -325,550 0.00 0.00 0.00 0.00
Acquisition of
Furniture -3,100 0.00 0.00 0.00 0.00
Net Cash From
Investing Activities -328,650.00 0.00 0.00 0.00 0.00
Cash Flow from
Financing Activities
Investment 430,529.00 0.00 0.00 0.00 0.00
Drawings 0.00 0.00 0.00 -10,297.85 -10,819.62
Net Cash From
Financing Activities 430,529.00 0.00 0.00 -10,297.85 -10,819.62
Net Increase
(Decrease) in Cash 271,666.12 213,463.84 220,462.25 218,653.88 228,701.18
Cash at the end of
previous year 0.00 271,666.12 485,129.96 705,592.21 924,246.09
Cash at the end of
the year 271,666.12 485,129.96 705,592.21 924,246.09 1,152,947.27
78
Schedule 3
PROJECTED BALANCE SHEET
2015 2016 2017 2018 2019
Assets
Current Assets
Cash 271,666.12 485,129.96 705,592.21 924,246.09 1,152,947.27
Total 271,666.12 485,129.96 705,592.21 924,246.09 1,152,947.27
Fixed Assets
Machinery and
Equipment 320,750.00 320,750.00 320,750.00 320,750.00 320,750.00
Less:
Accumulated
Depreciation -19,650.00 -39,300.00 -58,950.00 -78,600.00 -98,250.00
Total 301,100.00 281,450.00 261,800.00 242,150.00 222,500.00
Total Assets 580,666.12 774,479.96 975,292.21 1,194,891.80 1,415,284.36
`
Liability & Owner's Equity
Current Liability
Income Tax
Liability 14,527.42 27,085.32 31,974.39 35,319.03 38,797.46
Total Liability 14,527.42 27,085.32 31,974.39 35,319.03 38,797.46
Owner's Equity
Owner's Capital 566,138.70 747,394.64 943,317.82 1,149,274.91 1,365,667.28
Withdrawal 0.00 0.00 0.00 10,297.85 10,819.62
Total Owner's Equity 566,138.70 747,394.64 943,317.82 1,159,572.77 1,376,486.90
Total Liability &
Owner's Equity 580,666.12 774,479.96 975,292.21 1,194,891.80 1,415,284.36
79
Schedule 4
COMPUTATION OF NET PRESENT VALUE AND BENEFIT COST RATIO
Discount
Net Income After Discounted
Year Depreciation Benefits Rate of
Tax Value
19.874%
2015 135,609.70 19,650.00 155,259.70 0.834 129,486.59
2016 181,255.95 19,650.00 200,905.95 0.696 139,830.54
2017 195,923.18 19,650.00 215,573.18 0.581 125,248.01
2018 205,957.09 19,650.00 225,607.09 0.484 109,193.83
2019 216,392.37 19,650.00 236,042.37 0.404 95,361.12
Total Benefits Discounted 599,120.09
Less Total Investment 430,529.00
Net Present
Value 168,591.09
Year 2015 2016 2017 2018 2019

Net Income 135,609.70 181,255.95 195,923.18 205,957.09 216,392.37
Equity 580,666.12 774,479.96 975,292.21 1,194,891.80 1,415,284.36
Net
Income/Equity 0.2335 0.2340 0.2009 0.1724 0.1529
Total NI/Equity 0.9937

Divide by Number
of Years 5
Discount Ratio 19.87%
Benefit Cost Ratio

Gross Benefit 599,120.09
Total Investment 430,529.00
Benefit Cost
Ratio 1.392
80
Schedule 5
COMPUTATION OF INTERNAL RATE OF RETURN
Discount Discounted Discounted Discounted

Year Cash Flow Rate(45%) Value Rate(40%) Value
0 -430,529.00 -430,529.00 -430,529.00
1 155,259.70 0.69 107,129.19 0.714 110,855.42
2 200,905.95 0.476 95,631.23 0.51 102,462.03
3 215,573.18 0.328 70,708.00 0.364 78,468.64
4 225,607.09 0.226 50,987.20 0.26 58,657.84
5 236,042.37 0.156 36,822.61 0.186 43,903.88
Net Present Value -69,250.77 -36,181.18
99%-r = -69,250.77
(-3,356.02)-
99%-94%
35,551.94
45%-r = -69,250.77
5% -33,069.58
45%-r = 3298x5%
-33,069.58
45%-r = -3462.538251
-33,069.58
r = 0.104705
r = 0.545295
r = 54.53%
81
Schedule 6
PROFITABILITY RATIOS
Return on Sales
Year Net Income After Tax Net Sales Ratio
2011 135,609.70 508,703.52 0.267
2012 181,255.95 529,051.66 0.343
2013 195,923.18 550,213.73 0.356
2014 205,957.09 572,222.28 0.360
2015 216,392.37 595,111.17 0.364
0.338
Return on Investment
Year Net Income After Tax Average Investment Ratio
2011 135,609.70 283,069.35 0.479
2012 181,255.95 373,697.32 0.485
2013 195,923.18 471,658.91 0.415
2014 205,957.09 579,786.38 0.355
2015 216,392.37 688,243.45 0.314
0.410
Gross Profit Ratio

Year Gross Profit Net Sales Ratio
2011 390,323.52 508,703.52 0.767
2012 410,191.66 529,051.66 0.775
2013 430,854.53 550,213.73 0.783
2014 448,743.91 572,222.28 0.784
2015 467,348.86 595,111.17 0.785
0.779
82
Schedule 7
TEST OF RETURN ON CAPITAL INVESTMENT
Payback Period
Uncovered
Year Cash Inflow Investment
0 430,529.00
1 135,609.70 294,919.30
2 181,255.95 113,663.36
3 195,923.18
4 205,957.09
5 216,392.37
Payback 942 days
2 years
2.580 and 212days 212
Average Rate of Return

Average Net Income 187,027.66
Divided by Initial Year Cash
Outflow/2 215,264.50
Average Rate of Return 0.869
83
Chapter 6
SOCIO-ECONOMIC DESIRABILITY
In putting up a business, investment and profit are the essential things that come
into the mind. These are the reasons why one opens a business. But there are other
reasons like being able to contribute to the society in terms of social responsibility, to be
an asset to the community surrounding you and the church that sustains you. Its
contribution should not be taken for granted for it plays a significant role in the progress
and improvements of the society and economy. The implementation of the proposed
project will not only bring forth profit to the management but it also can be considered
socially and economically beneficial in numerous ways.
This chapter focuses on the different ways the proposed business could contribute
to the economy and people of the society. It will discuss how the following will benefit
from it.
A. Customers
In every industry customers are inevitably the core of the business. They
are the life blood of every business, filling their wants and needs are grounds for
establishing one. The proposed product will aid in the need of customers for
health improvement. Clean and quality product will be produce to assure the
customers need for a safe and healthy drinking water.
B. Employees
Employees hold a key role for the company to be successful. Therefore,
the employees must be treated well so their contribution to the company will be
maximized. Being the workforce of the proposed business, employees will be
84
provided with appropriate salaries, a pleasant working environment and they will
also receive benefits and good incentives in return of their hard work for the
betterment of the business. This will ensure that the employees will be able to
provide the basic needs and the future security of their families.
Aside from a reasonable compensation, workers will have the chance to
develop certain personal qualities like responsible, honesty, and diligence
regardless of their respective job descriptions.
C. Owner
The owner who put much effort in financing the proposed business will be
in return also the most to be benefited; in terms of income return by the business
and acquisition of additional knowledge as he manages the operation of the
business. Aside from the benefit the owner can acquire, the owner will also feel
the assurance not only for him and the business but also for other people as it will
open the opportunity for others to have a job and lastly the greatest satisfaction of
the owner will be in the knowledge that they were able to provide services to a
customer.
D. Students
To the students, this would give them a bit of information and especially
to those who will be conducting a study of the same project; this will serve as a
reference to guide them as they do their own study.
85
E. Church
Ten percent of the business income will be an additional fund to finance
the activities inside and outside the church in reaching and spreading the word
of God to the people.
F. Government
This business will be an additional source of income to the government
considering the tax the business will contribute, to aid in pursuing economic
goals for the improvement of the economy and public service.
G. Community
The proposed business is an additional benefit to the community by the
job openings that it would offer. One more thing is that this proposed
business is about Establishing Purified Drinking Water Refilling Station. This
will help the community have the necessities nearer to them and be more
convenient to acquire.
86
Chapter 7
FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
This chapter discusses the whole study on the feasibility and viability establishing
a Water Refilling Station. The findings are stated, the conclusion is formulated and
the recommendation for the proposed business is evaluated.
A. Findings
The researcher had gathered enough resources to satisfy the stated objectives. All areas
are carefully considered to avoid loopholes that may impair the viability of the project.
Below are the findings and result of the study.
Marketing. Refilling purified water was the primary product of the proposed
business. This study deals with the demand and supply analysis resulting from the
distributed survey questionnaire. The demand is based on the willingness and the
capacity of the customers who are willing to patronize the products offered. Based on the
result of the survey questionnaire 45 or 64% of the population are buying the water from
stores and water stations. Out of 70 respondents, 56 or an equivalent of 80% are willing
to avail the products being offered. The study shows that the demand in peso for the first
year of operation amounted to Php 14,743.605.00. The supply was determined to be Php
13,392,333.00 leaving an unmet demand of Php 1,351,273.00. The proposed business has
a capacity of 63%.
Technical. It deals on process of business operation. It also concentrates on
machinery and equipment, furniture and fixtures, and other technical information such as
the place where the business will be put up, the building and its floor layout, the utilities
and other operation cost that will be incur which are necessary in the operation of the
87
business. Equipment, furniture and fixtures were estimated to have a cost of Php
328,650.00 which is to be depreciated using the straight-line method however Php
7,900.00 will not be depreciated and will be expensed outright. The researcher
determined to locate the proposed business 908 Venturina Street Matimbubong, San
Ildefonso, Bulacan where it is readily accessible to customers. The location of the
business shows the amount of Php 30,000.00 annual rental expenses. Operating expenses
amounted to Php 330,644.00 annually, including utilities expense of Php 9,600.00.
Organization and Management. The form of organization that will be assumed for
the proposed business is a sole proprietorship because it is the most appropriate for a
business like this. The proprietor will be able to exercise personal judgment, ownership
of all profits, can minimize the taxes and have a minimum restriction.
The business is composed of a manager, worker and the delivery boy with their
corresponding duties and responsibilities. Just and right compensation will be given to
each one of them. The accountant is also part of the business operation but not directly
related. For the first year of operation, they will be given an annual salary with a total of
Php 205,916.40, for the worker, Php 106,380.00; Delivery boy Php 99,536.40 and the
accountant's professional fee of Php 20,000.00.
Financial. Based on the capital budgeting techniques and financial analysis tools
used, the proposed business is proven to be financially acceptable for its profitability,
liquidity and stability. An initial capitalization of Php 430,529.00 is required to realize
the project and this would cover the entire investment. The financial study of business
proved that the business would be profitable for the next five years. The income
88
statement shows its profitability and resulted to 0. 338 Return on Sales, 0.410 Return on
Investment, and a 0.779 Gross Profit ratio.
In a span of 2 years and 212 days the business will recover its investment upon
meeting its target. There will also be a net present value of Php 168,591.09 with and IRR
of 54.53% and a 1.392 in the cost benefit ratio. The discount factor was 19.874% derived
after dividing all the profits by the capital of each year and getting the average. These
figures are essential in evaluating the capital budget of the proposed business.
Socio-Economic Desirability. The business proved to be desirable in the community
since it will provide them high quality products which are very affordable yet profitable.
Based on the income tax that the proposed business would have, it will be a great help to
support the projects of the Governments. This proposed business will concentrate on
providing the quality and safe purified water to satisfy the consumers.
Conclusion
The evaluation has been done and the researchers conclude that the establishment of
the proposed business is viable and feasible.
Recommendation
The researcher recommends to the prospective investor that the business be
implemented in July 2014.
89
Bibliography
Books
Aulbuch, Robert A. and Corradi, George R. Energy and Water Resource Management
Copyright 1988, Michigan USA pp. 29-43
Narbarte, Miriam P. How to Prepare a Feasibility Study, Second Edition: Philippines,
1998
The New Miriam Webster Dictionary
Internet
http://www.drinkmorewater.com/water-purification-methodshttp://
www.pacinst.org/wp-
content/uploads/sites/21/2013/02/water_quality_facts_and_stats3.pdf
http://www.people-water-station.com/water-in-the-philippines/
http://www.unicef.org/wash/index_wes_related.html
http://www.nestle-waters.com/brands/water-quality/purified-water
http://www.mayoclinic.org/diseases-conditions/diarrhea/basics/definition/con-20014025
http://www.drinking-water.org/html/en/Overview/Why-is-Safe-Water-Essential.html
http://en.wikipedia.org/wiki/Water_purification
http://www1.agric.gov.ab.ca/$department/deptdocs.nsf/all/agdex5432
http://en.wikipedia.org/wiki/Reverse_osmosis
http://www.livestrong.com/article/152739-water-purification-advantages-disadvanages/
http://www.allaboutwater.org/water-filters.html
http://ianrpubs.unl.edu/epublic/pages/publicationD.jsp?publicationId=316
http://maps.google.com
http://www.nscb.gov.ph/secstat/d_price.asp
90
http://www.nwpc.dole.gov.ph/pages/statistics/stat_current_regional.html
http://en.wikipedia.org/wiki/Drinking_water
http://maps.google.com
https://www.youtube.com/watch?v=mJ4GCFN8tpk
https://www.youtube.com/watch?v=c9kb0YrXFwI
91
APPENDICES
92
Appendix 1
Computation of Projected Population
Historical Population of Matimbubong,

Increase Growth
Year Matimbubong Malipangpang Pinaod Population
(Decrease) Rate
2010 522 857 1145 2,524

2011 543 892 1192 2,627 103 4.08%
2012 565 929 1241 2,735 108 4.11%
2013 580 955 1275 2,810 75 2.74%
2014 611 1006 1345 2,962 152 5.41%
Total 2821 4639 6198 13,658 438 14.79%
Average 2,732 110 3.70%
Computation for Projected Individual Population
Year X Y X2 XY
2010 -3 2524 9 -7,572

2011 -1 2627 1 -2,627
2012 0 2735 0 0
2013 1 2810 1 2,810
2014 3 2962 9 8,886
Total 0 13658 20 1497
a = Y bX
n
= 13,658
5
= 2,732
b = XY XY/n
93
X2 (X)2 /n
= 1,497
20
= 74.85
Yc = a + Bx
Year A B X Bx Yc
2015 2,732 74.85 5 374 3,106

2016 2,732 74.85 7 524 3,256
2017 2,732 74.85 9 674 3,405
2018 2,732 74.85 11 823 3,555
2019 2,732 74.85 13 973 3,705
Projected Population for the Year 2015-2019

Matimbubong, Malipangpang and Pinaod, San Ildefonso, Bulacan
Increase Growth
Year Population
(Decrease) Rate
2015 3,106
2016 3,256 150 4.82%
2017 3,405 150 4.60%
2018 3,555 150 4.40%
2019 3,705 150 4.21%
Total 17,026 600 18.03%
Average 3,405 150 4.51%
94
Appendix 2
% of Total # of
Projected
Year Willing Willing
Population
Respondents Respondents
2015 3,106 80% 2,485

2016 3,256 80% 2,604
2017 3,405 80% 2,724
2018 3,555 80% 2,844
2019 3,705 80% 2,964
Legend
A = Projected Population
B = Percentage of Willing Respondents
C = A*B
D = Percentage who are willing to buy per frequency (once a week and month, twice a week and month
E = C*D
F = Percentage for Quantity
G = E*F
H = Average amount of Quantity
I = Frequency Annually
J = G*H*I
Once
Year A B C D E F G H I J
2015 3,106 80% 2,485 64% 1,590 42% 668 1.5 52 52,097
47% 747 3.5 52 136,032
11% 175 5.5 52 50,030
0% 0 7.5 52 0
0% 0 9.5 52 0
0% 0 11.5 52 0 238,159
Twice
2015 3,106 80% 2,485 46% 1,143 85% 972 1.5 104 151,563
15% 171 3.5 104 62,408
0% 0 5.5 104 0
0% 0 7.5 104 0
0% 0 9.5 104 0
0% 0 11.5 104 0 213,971
452,130
95
2016 3,256 80% 2,605 64% 1,667 42% 700 1.5 52 54,613
47% 784 3.5 52 142,601
11% 183 5.5 52 52,446
0% 0 7.5 52 0
0% 0 9.5 52 0
0% 0 11.5 52 0 249,661
Twice
2016 3,256 80% 2,605 46% 1,198 85% 1,018 1.5 104 158,882
15% 180 3.5 104 65,422
0% 0 5.5 104 0
0% 0 7.5 104 0
0% 0 9.5 104 0
0% 0 11.5 104 0 224,305
Once
2017 3,405 80% 2,724 64% 1,743 42% 732 1.5 52 57,112
47% 819 3.5 52 149,127
11% 192 5.5 52 54,846
0% 0 7.5 52 0
0% 0 9.5 52 0
0% 0 11.5 52 0 261,086
Twice
2017 3,405 80% 2,724 46% 1,253 85% 1,065 1.5 104 166,153
15% 188 3.5 104 68,416
0% 0 5.5 104 0
0% 0 7.5 104 0
0% 0 9.5 104 0
0% 0 11.5 104 0 234,569
Once 495,655
2018 3,555 80% 2,844 64% 1,820 42% 764 1.5 52 59,628
47% 855 3.5 52 155,696
11% 200 5.5 52 57,262
0% 0 7.5 52 0
0% 0 9.5 52 0
0% 0 11.5 52 0 272,587
Twice
2018 3,555 80% 2,844 46% 1,308 85% 1,112 1.5 104 173,473
15% 196 3.5 104 71,430
0% 0 5.5 104 0
0% 0 7.5 104 0
0% 0 9.5 104 0
0% 0 11.5 104 0 244,903
517,490
96
Once
2019 3,705 80% 2,964 64% 1,897 42% 797 1.5 52 62,144
47% 892 3.5 52 162,266
11% 209 5.5 52 59,678
0% 0 7.5 52 0
0% 0 9.5 52 0
0% 0 11.5 52 0 284,089
Twice
2019 3,705 80% 2,964 46% 1,363 85% 1,159 1.5 104 180,792
15% 205 3.5 104 74,444
0% 0 5.5 104 0
0% 0 7.5 104 0
0% 0 9.5 104 0
0% 0 11.5 104 0 255,236
539,325
Appendix 3
Projected Annual Demand in Peso

Year Price Demand in Peso
2015 452,130 33 14,743,605
2016 473,965 34 16,073,852 1,330,247 8.28%
2017 495,655 35 17,481,795 1,407,943 8.05%
2018 517,490 37 18,981,995 1,500,200 7.90%
2019 539,325 38 20,574,240 1,592,245 7.74%
Legend
A = Population
B = Percentage
C = A*B
D = Percentage per frequency (once a week and month, twice a week and month )
E = C*D
F = Percentage for Quantity
G = E*F
H = Average amount of Quantity
I = Frequency Annually
J = G*H*I
97
Appendix 4
Projected Annual Supply in Quantity per Container
Once
2015 3,106 64% 1,988 67% 1,332 23% 306 1.5 52 23,893
60% 799 3.5 52 145,438
17% 226 5.5 52 64,755
0% 0 7.5 52 0
0% 0 9.5 52 0
0% 0 11.5 52 0 234,086
Twice
2015 3,106 64% 1,988 33% 656 47% 308 1.5 104 48,097
53% 348 3.5 104 126,553
0% 0 5.5 104 0
0% 0 7.5 104 0
0% 0 9.5 104 0
0% 0 11.5 104 0 174,650
Once 408,736
2016 3,256 64% 2,084 67% 1,396 23% 321 1.5 52 25,047
60% 838 3.5 52 152,462
17% 237 5.5 52 67,882
0% 0 7.5 52 0
0% 0 9.5 52 0
0% 0 11.5 52 0 245,391
Twice
2016 3,256 64% 2,084 33% 688 47% 323 1.5 104 50,420
53% 364 3.5 104 132,665
0% 0 5.5 104 0
0% 0 7.5 104 0
0% 0 9.5 104 0
0% 0 11.5 104 0 183,085
428,476
Once
2017 3,405 64% 2,179 67% 1,460 23% 336 1.5 52 26,194
60% 876 3.5 52 159,439
17% 248 5.5 52 70,988
0% 0 7.5 52 0
0% 0 9.5 52 0
0% 0 11.5 52 0 256,621
Twice
2017 3,405 64% 2,179 33% 719 47% 338 1.5 104 52,727
53% 381 3.5 104 138,736
0% 0 5.5 104 0
98
0% 0 7.5 104 0
0% 0 9.5 104 0
0% 0 11.5 104 0 191,463
Once 448,084
2018 3,555 64% 2,275 67% 1,524 23% 351 1.5 52 27,347
60% 915 3.5 52 166,463
17% 259 5.5 52 74,116
0% 0 7.5 52 0
0% 0 9.5 52 0
0% 0 11.5 52 0 267,926
Twice
2018 3,555 64% 2,275 33% 751 47% 353 1.5 104 55,050
53% 398 3.5 104 144,847
0% 0 5.5 104 0
0% 0 7.5 104 0
0% 0 9.5 104 0
0% 0 11.5 104 0 199,897
467,823
Once
2019 3,705 64% 2,371 67% 1,589 23% 365 1.5 52 28,501
60% 953 3.5 52 173,486
17% 270 5.5 52 77,243
0% 0 7.5 52 0
0% 0 9.5 52 0
0% 0 11.5 52 0 279,231
Twice
2019 3,705 64% 2,371 33% 782 47% 368 1.5 104 57,373
53% 415 3.5 104 150,959
0% 0 5.5 104 0
0% 0 7.5 104 0
0% 0 9.5 104 0
0% 0 11.5 104 0 208,332
487,562
Appendix 5
Projected Annual Supply in Peso

Year Price Supply in Peso
2015 408,736 33 13,328,570
2016 428,476 34 14,531,145 1,202,575 8.3%
2017 448,084 35 15,803,959 1,272,814 8.1%
2018 467,823 37 17,160,175 1,356,216 7.9%
2019 487,562 38 18,599,603 1,439,427 7.7%
99
Appendix 6
Computation of Basic Salary
Annual Compensation Package

Job Position 2015 2016 2017 2018 2019
Worker 106,380.00 106,380.00 106,380.00 109,980.00 113,724.00
Delivery Boy 99,536.40 99,536.40 99,536.40 102,896.40 106,390.80
Total 205,916.40 205,916.40 205,916.40 212,876.40 220,114.80
Year 2015
Job Position
Salary Salary
Worker 7,500.00 530.00 100.00 100.00 10.00 8,240.00

Delivery Boy 7,000.00 494.70 100.00 100.00 10.00 7,704.70
Total 14,500.00 1,024.70 200.00 200.00 20.00 15,944.70

Total
Deductions
Worker 8,240.00 250.00 100.00 100.00 450.00 7,790.00
Delivery Boy 7,704.70 233.30 100.00 100.00 433.30 7,271.40
Total 15,944.70 483.30 200.00 200.00 883.30 15,061.40
Gross Annual
Annual 13th Month
Gross Pay Pay
Salary Package
Worker 8,240.00 98,880.00 7,500.00 106,380.00
Delivery Boy 7,704.70 92,456.40 7,080.00 99,536.40
Total 15,944.70 191,336.40 14,580.00 205,916.40
100
Year 2016
Job Position
Salary Salary
Worker 7,500.00 530.00 100.00 100.00 10.00 8,240.00

Delivery Boy 7,000.00 494.70 100.00 100.00 10.00 7,704.70
Total 14,500.00 1,024.70 200.00 200.00 20.00 15,944.70

Total
Deductions
Worker 8,240.00 250.00 100.00 100.00 450.00 7,790.00
Delivery Boy 7,704.70 233.30 100.00 100.00 433.30 7,271.40
Total 15,944.70 483.30 200.00 200.00 883.30 15,061.40
Gross Annual
Annual 13th Month
Gross Pay Pay
Salary Package
Worker 8,240.00 98,880.00 7,500.00 106,380.00
Delivery Boy 7,704.70 92,456.40 7,080.00 99,536.40
Total 15,944.70 191,336.40 14,580.00 205,916.40
Year 2017
Job Position
Salary Salary
Worker 7,500.00 530.00 100.00 100.00 10.00 8,240.00

Delivery Boy 7,000.00 494.70 100.00 100.00 10.00 7,704.70
Total 14,500.00 1,024.70 200.00 200.00 20.00 15,944.70

Total
Deductions
Worker 8,240.00 250.00 100.00 100.00 450.00 7,790.00
Delivery Boy 7,704.70 233.30 100.00 100.00 433.30 7,271.40
Total 15,944.70 483.30 200.00 200.00 883.30 15,061.40
101
Gross Annual
Annual 13th Month
Gross Pay Pay
Salary Package
Worker 8,240.00 98,880.00 7,500.00 106,380.00
Delivery Boy 7,704.70 92,456.40 7,080.00 99,536.40
Total 15,944.70 191,336.40 14,580.00 205,916.40
Year 2018
Employer's Contribution Gross
Basic
Job Position Monthly Benefits Monthly
Salary
SSS Phil Health PAGIBIG EC Salary
Worker 7,800.00 530 100 100 10 8,540.00
Delivery Boy 7,280.00 494.7 100 100 10 7,984.70
Total 15,080.00 1,024.70 200.00 200.00 20.00 16,524.70

Total
Deductions
Worker 8,540.00 250 100 100 450 8,090.00
Delivery Boy 7,984.70 233.3 100 100 433.3 7,551.40
Total 16,524.70 483.3 200 200 883.3 15,641.40
Gross Annual
Annual 13th Month
Gross Pay Pay
Salary Package
Worker 8,540.00 102,480.00 7,500.00 109,980.00

Delivery Boy 7,984.70 95,816.40 7,080.00 102,896.40
Total 16,524.70 198,296.40 14,580.00 212,876.40
Year 2019
Employer's Contribution Gross
Basic
Job Position Monthly Benefits Monthly
Salary
SSS Phil Health PAGIBIG EC Salary
Worker 8,112.00 530 100 100 10 8,852.00
Delivery Boy 7,571.20 494.7 100 100 10 8,275.90
Total 15,683.20 1,024.70 200.00 200.00 20.00 17,127.90
102
Total
Deductions
Worker 8,852.00 250 100 100 450 8,402.00
Delivery Boy 8,275.90 233.3 100 100 433.3 7,842.60
Total 17,127.90 483.3 200 200 883.3 16,244.60
Gross Annual
Annual 13th Month
Gross Pay Pay
Salary Package
Worker 8,852.00 106,224.00 7,500.00 113,724.00

Delivery Boy 8,275.90 99,310.80 7,080.00 106,390.80
Total 17,127.90 205,534.80 14,580.00 220,114.80
103
Appendix 7
Application for Department of Trade & Industry
104
Appendix 8
Sanitary Permit
Bulacan
105
Appendix 9
Application for Bureau of Internal Revenue
106
Appendix 10
Application for Electrical Permit
107
Appendix 11
Application for Business Permit
108
Appendix 12
SSS Schedule of Contribution
109
Appendix 13
Phil Health Schedule of Contribution
110
CURRICULUM
VITAE
111
Personal Information
Name: Corpus, Joshua Jade G.
Birthday: January 20, 1995
Age: 20
Address: 15-mit Balon-Bato Leland Drive Quezon City
Course: Bachelor of Science in Accountancy
Educational Background
Tertiary: Manila Adventist College
Secondary: Adventist University of the Philippines Academy
Primary: Baesa Adventist Elementary School
112

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Chapter 1

other related diseases.

water available in their neighborhoods.

According to the Department of health, diarrhea-related diseases is one of the top

The researcher proposed on working Aqua Light Water Refilling Station in

of Establishing Aqua Light Water Refilling Station in Matimbubong, San Ildefonso,

determine the market share.

b. To formulate marketing strategies for a successful business operation.

c. To describe the general trade practices of an industry on business who

sells the same product.

d. To present a comprehensive description of the product being offered

and to evaluate competitors.

a. To develop the processes involved in operationalizing the project in

the most effective and economical way.

b. To be able to choose the best equipment, machineries, furniture and

fixtures needed in the business but also balancing technology with

d. To select an appropriate way in acquiring the building.

e. To determine the best time schedule of business operation.

f. To determine the operating cost, labor cost, and other cost of

Organization and Management

a. To design the most appropriate business organization set-up.

b. To determine the personnel needed and the characteristics they must

c. To establish the timeframe for the design and implementation of the

a. To make an estimate of the amount of total investment required to

implement and operationalize the project.

b. To evaluate the profitability, liquidity and stability of the business

c. To forecast future revenues and expenses.

d. To present the projected financial statement.

D. Significance of the Study

This study bears significance to the following:

theories and knowledge obtained in the preparation to their planned professions;

who is planning to proceed and develop the research;

establishing a small enterprise and further help the countrys economy.

E. Scope and Limitations

refilling station in Puting Kahoy Silang, Cavite. The residents of Matimbubong,

personal interview, survey, book, articles, and internet surfing.

The data were gathered from interview and survey questionnaire. As a

questionnaires and others sampling techniques.

resources such as Encarta, Google, Wikipedia and the Department of Health.

arrive at the sample size.

Where: N = Estimated Population

of .12 or 12%, the number of respondents was computed as follows

The formula is: Yc = a + bx, where:

Y = is the given/gathered data

In relation to the earning power of the project, researcher applied the

1. Net Present Value (NPV)

In short: If NPV > 0; Accept

If NPV < 0; Reject

2. Internal Rate of Return (IRR) the formula for IRR is as follows:

then necessary to reject the project.

overall value for money, of a project proposal. Ratio of the benefits of a

project, expressed in monetary term, relative to its cost also expressed in

monetary terms. The formula is:

B/C Ratio = ___ bi____

Where; bi = benefit in period i

1. Rate of Return on Sales. This ratio signifies the amount of net

earnings in peso of sales. A considerably positive ratio implies a

satisfactory return so it is safe to pursue the project.

is significantly more than zero, then the investment earns well so it is

advisable to accept the project.

Return on Investment = Net Income

sales and used in determining the sufficiency of gross margin to cover

operating expenses and provide desired profit. A favorable ratio is

achieved when it is positive, thus implying that the project is capable

B/C Ratio = _ bi__

Average Rate of Return = Average Net Income__

Payback Period in year = __Initial-Year Cash Outflow