FEASIBILITY STUDY

“LABADA” LAUNDRY SHOP

Members:
Custodio, Ma. Nicole E.
Renido, Robert Lemuel
Reyes, Christien Rome
San Juan, Karlose
Solitario, Abigail Jeanette
INTRODUCTION:

Clothing is one of the essentials in a person’s life. Clothes that we wear leave a
good impression on others so wearing clean and good clothes reflects so much of our
personalities. In a college life, most students reside on dormitories and has no ownership of
washing machines which is why some resort to manual washing. However, manually washing
of clothes are dreadful work and are time consuming in a college’s life. This is why we are
proposing a business that offers a comfortable space to where one can laundry their own
clothes with our quality washing machines.
Labada offers laundry services at the customers’ convenience. It is a self-service
laundromat that provides quality washing machines and comfortable spaces while waiting
for your laundry to finish. The proposed business is to be established near President Ramon
Magsaysay State University.
Currently, there is one laundry shop within the kilometer radius of the university.
But with the population of the university approximately in 5,700 students and its neighboring
community, there is a need to establish laundry services in the area.
LOCATION:

Labada laundry shop is situated in a commercial building located at Iba,

Zambales, Palanginan Road. Its monthly rent it Php 30,000.00 and the size of the area
is 75sqm. Its distance from President Ramon Magsaysay State University is exactly
450m and approximately about a 6 minute walk. There is only one laundry shop around
the around the area that is why we’ve decided to start the business near the University
to cater more costumers that lives with in the area.
Service Operation:
Labada’s laundry services makes use of a Stacked
Washer and Dryer Machine. The machine has a 30lbs
capacity for clothes with a simple and user-friendly
interface for the users to choose which mode of washing
they need.
In availing of the Labada’s self-service laundry,
customers must first pay the laundry fee in the reception
desk. Labada’s rate is 65 pesos for washing and another
65 pesos for drying. The helper employee will then direct
them to the machine where the customer can begin
washing their clothes with the washing mode they choose.
After 30 to 40 minutes, the clothes are done washing and
can begin drying on the machine above the washer. After
selecting the degree of temperature, they want in drying,
the customer will wait another 40 minutes to dry the
clothes. When the clothes are dry, the customer can now
either fold the clothes on the designated desks or head
home.
 FINANCIAL
REQUIREMENTS
VARIABLE COSTS
PRICE QUANTITY TOTAL
Detergent and Fabric
Conditioner
12 500 6,000
Employee Salary
13,500 4 54, 000
Space Rental Fee 12x per
30,000 30,000
year
Utilities
30,000 30,000
TOTAL VARIABLE COST
120,000
FIXED COSTS:
PRICE QUANTITY TOTAL
Stack Washer and Dryer 125,000 20 2,500,000
30lbs (Dexter brand)

Air conditioning unit (Carrier) 18,000 2 36,000

Television 6,000 1 6,000
General Construction (Folding 400,000 400,000
Desks and Shelves)

Laundry Basket 250 40 10,000

Furnishings 15,000 15, 000
Hanger 25 8 (Sets of 12) 200
Hanger Rack 500 4 2000
TOTAL FIXED COST 2,969,200
 PRICE QUANTITY TOTAL
Stack Washer and Dryer 30lbs 125,000 20 2,500,000
(Dexter brand)

Detergent and Fabric Conditioner 12 500 6,000

General Construction (Folding 400,000 400,000
Desks and Shelves)

Space Rental Fee 30,000 12x per year 30,000

Laundry Basket 250 40 10,000
Furnishings 15,000 15, 000
Air conditioning unit (Carrier) 18,000 2 36,000
Television 6,000 1 6,000
Employee Salary 13,500 4 54, 000
Hanger 25 8 (Sets of 12) 200
Hanger Rack 500 4 2000
Monthly Utilities 30,000 30,000
TOTAL COST 3,089,200
CAPITAL 3,089,200
Total Fixed Cost 2,969,200
Total Variable Cost 120,000
PRICE PER QUANTITY (Wash And Dry) 130.00
TOTAL REVENUE MONTHTY (3 Cycles Per Day) 234,000
Gross Profit: Net Income (TR – TVC) 2,808,000-1,440,000
1,368,000

Months to pay FIXED COST 26 months

RETURN OF INVESTMENT

Total Fixed cost: 2,969,200

Total Variable cost (per month): 120,000
Total Revenue (per month): 114,000
Gross Profit: 2,808,000

2,969,200+ (12x120,00) = 4,409,200 Outflow first year

1,601,200+ (12x120,000) = 3,041,200 Outflow second year
233,200+ 12(120,000) = 1,673,200 Outflow third year
12(120,000) =1,440,000 Outflow fourth year
234,000 x 12 = 2,808,00 Total inflows per year

ROI After 2.2 years

𝑡𝑜𝑡𝑎𝑙 𝑖𝑛𝑓𝑙𝑜𝑤𝑠−𝑡𝑜𝑡𝑎𝑙 𝑜𝑢𝑡𝑙𝑓𝑜𝑤𝑠

ROI = 𝑥 100%
𝑡𝑜𝑡𝑎𝑙 𝑜𝑢𝑡𝑓𝑙𝑜𝑤𝑠

ROI = -36% YEAR 1

ROI = -7% YEAR 2
ROI = 67.82% YEAR 3
ROI = 95% YEAR 4 and onwards
CONCLUSION:

In approximately two years and two months, all financial investments will be
earned.
The earnings of the laundry shop will start to operate all the finances and other
future investments of needed for the business.