Business Plan

Name of Association

Address

_______________________________________________

Presented to:

______________________________________________________________________

Prepared by:
I. Executive Summary

I.1 General Information of the Organization

Proposed Project:
Project Location:
Proponent:
Contact Person:
Position/Designation:
Address:
Contact Number:

Total Project Cost

Funding Sources

Funding Program
Fund Purpose
Project Status: Expansion
Number of Beneficiaries: 287 members

Objectives:
a.) To initially serve as a foundation for strengthening the cooperative/association development
of the government.
b) To serve as the channel between the government and the private agencies in the provision of
technical assistance and other support services agriculture development and water management
implementation of farm level.
c.) To encourage participation of the farmers and promoting a wholesome community life and
enhance community pro
sperity.
d) To serve as a vehicle for the speedy integration of resources, skills, and talents of manpower
for maximum productivity and economic activities. Rate or federate similar associations that
spearhead growth, and
e.) To cooperate development process of the cooperative.

Vision/Mission Statements
VISION: To build a community wherein members will live a better life.

MISSION: To ensure transparency in delivering services to members.

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I.2 Brief Description of the Project

The __________________________________________ proposes to establish _______

to enhance members' rice farming operations and improve their economic well-being. By
________________, members can increase profits, reduce costs, and ensure quality control. The
______________ will also generate employment and contribute to local development.

The project will involve acquiring or constructing a ______, developing _______,

providing training, and establishing a marketing plan. Financial considerations, including
funding options and cost-benefit analysis, will be carefully evaluated. Long-term sustainability
will focus on community involvement, environmental considerations, and proper planning.

By successfully implementing this project, the cooperative can empower its members,
improve livelihoods, and contribute to the overall development of the local community.

State the purpose. Provide two to three sentences that will state the purpose or goal of the project
especially its impact to the beneficiaries

State what to acquire. Provide two to three sentences that will state the financial/ monetary, PPE
and technology.

State the expected output and/or impact to the community as well.

II. Feasibility Study

II.1 Market Aspect

Product/Service

Product overview

1. What is your product or service?

2. What problem does it solve?
3. How does it meet customer needs?

Product Details

1. Product details
2. Design and Develoment
3. Intellectual property

Target Market
Well-milled palay can be marketed to a diverse range of consumers and institutions, including
households, grocery stores, hospitals, malls, city jails, food processing facilities, and potential

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export markets. The primary target market consists of individuals who value high-quality,
nutritious food and are willing to pay a premium price. Retailers seeking to offer premium
products, hospitals prioritizing patient nutrition, and institutions like malls and jails with large-
scale food needs are also potential customers.

Name Location Area of Distribution

1. National Irrigation Koronadal, South Cotabato
Administration (NIA)
2. Public hospital Kiamba Sar. Prov.

3. City Jail General Santos City

4. Private Establishment General Santos City.
(Robinson Mall)
5. Local Retailers Kiamba, Sarangani Province Kiamba Sar. Prov
6. Consumers Kiamba, Sarangani Province
54,871 total population in
kiamba (PSA, 2020.)

Demand
 Insert an introductory paragraph. One to two sentences.
Buyers

Name Location Annual Volume

Requirement
7. National Irrigation Koronadal, South Cotabato
Administration (NIA) 1,800,000 kg.
8. Public hospital Kiamba Sar. Prov. 80,000 kg.

9. City Jail General Santos City 80,000 kg.

10. Private Establishment General Santos City. 80,000 kg.
(Robinson Mall)
11. Local Retailers Kiamba, Sarangani Province 60,000 kg.
12. Consumers Kiamba, Sarangani Province 50,000 kg.
54,871 total population in
kiamba (PSA, 2020.)

 Supply
Paragraph consisting of sources logistics and how to acquire the raw materials, components or
services necessary to produce the product or services
Present formula on how to achieve the target production
Supply: 392 ha. X 4.5 tons = 1,764 tons
In kilograms: 1, 764 x 1,000 = 1, 764, 000 kg. per cropping

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 Production volume (well milled rice)

Particulars

Wet palay hauled (in kilos) 3,528,000

Multiply: Recovery Rate Percentage (after drying.) 92%

Annual Production Volume of dried palay (in kilos) 3,234,011.76

Multiply: Recovery Rate Percentage (after milling) 65%

Annual Production Volume of Well-Milled 2,102,107.64

Competitors

Name Location Annual Rated Capacity

1. Edgar Gabor Salakit, Kiamba Sar. Prov. N/A

2. Alijandro Sanchez Tambilil, Kiamba Sar. N/A

Prov.

 Demand / Supply Gap (Demand minus Supply)

Demand Supply Gap

2,120,000 kg 2,102,107.64 17,892

 Market Share (Total Volume per year divided by Gap)

Volume produced by the Divide by: Gap Share

group
2,102,107.64 17,892 118.49

 Marketing Mix (Competitive Advantages)

Unique factors that allow your company to outperform the competitors in the market.
Show the investor or stakeholders why the business will succeed in the lon run. Two paragraphs

 Price/Pricing Strategy
The cooperative uses a dynamic pricing strategy. This involves adjusting prices based on
real-time factors, such as demand, time of day, or location.

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 Channels of Distribution (Direct consumer, wholesaler, retailers)
Enumerate how the product will reach the consumer through direct and indirect channels.
Two to three paragraphs.
1. How will the products flow from you to the customer?
2. What role does each of the distribution partners play?
3. Will you have exclusive partnerships, or will the product be
available through multiple channel?

 Projected Sales
The projected sales for well-milled rice are computed based on the volume produced
annually multiplied by the price.

Volume produced by the Price Total Sales

group Annually
2,102,107.64 P50.00 P105,105,382.20

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 II.2 Technical Aspect

Product Description
- Specifications
- Features
- Pricing or availability
- Varations
- Tone
Make a three paragraphs about the enumerated description guide

 Process (Figure and discussion)

Make sure to understand and enumerate the steps in creating the product and what step(s) the
association will start its intervention. Explain in narrative, three or more paragraphs

Land Preparation Planting IPM Fertilizaer

Application

Plowing Transplanting Herbicide 6 bags per

Harrowing using manpower application 1 hectare
Levelling L/ha.
Pesticide
application 4
bottles/ha.

Bagging Milling Drying Harvesting

50 kilos per 3 tons/ Harvester

sack hour Recirculating utilization
Dryer (12 hrs/ (4.5 MT/
10 MT) ha, 2
hrs/ha)
Solar Dryer
(200 sacks/ 2
days)

Marketing Distribution

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  Fixed Assets and Equipment
Name of Assets Cost per piece Estimated Useful Annual
Life Depreciation
Existing

Land (1 ha) 2,500,000/ha

Rotavator (2) 4,000,000.00 10 yrs 400,000

Hand Tractor (2) 240,000 5 yrs 48,000

Harvester (2) 5,000,000.00 10 yrs 500,000

6 wheeler Truck 10,000,000.00 15 yrs 666,660

(2)

To be Acquired

Building (for rice 10,000, 000.00 20 yrs 500,000

mill)

Warehouse (for 10,000,000.00 20 yrs 500,000

inventories,
supplies and
inputs)

Warehouse 10,000,000.00 20 yrs 500,000

(finished goods)

Floating tiller (15) 1,050,000 5 yrs 210,000

Harvester (1) 2,500,000.00 10 yrs 250,000

Hand Tractor (13) 1,560,000 5 yrs 312,000

Carabao (10) 600,000 10 yrs 60,000

Sprayer (100) 300,000 3 yrs 100,000

Recirculating 4,500,000.00 20 yrs 225,000

Dryer (3)

Rice Mill (1) 20,000,000.00 20 yrs 1,000,000

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 Bag closer 20,000.00 5 yrs 4,000
machine (1)

Weighing Scale 70,000.00 15 yrs 4,660

(2)

Sealer (5) 50,000.00 5 yrs 10,000

10 wheelers truck 14,000,000.00 15 yrs 933,333

(2)

Forklift (1) 500,000 15 yrs 33,330

TOTAL 12,658,663

 Capacity

Rated Capacity (Farm Paddies)

Particulars

Number of hectares 392 ha.

Multiply: Volume of wet palay harvested per cropping 4,500 kg.

Total Volume of Wet Palay Harvested per cropping 1,764,000 kg.

Multiply: Number of cropping per year 2

Total Volume of Wet Palay Harvested per year 3,528,000 kg.

Production volume (well milled rice)

Particulars

Wet palay hauled (in kilos) 3,528,000

Multiply: Recovery Rate Percentage (after drying.) 92%

Annual Production Volume of dried palay (in kilos) 3,234,011.76

Multiply: Recovery Rate Percentage (after milling) 65%

Annual Production Volume of Well-Milled 2,102,107.64

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 Location

State the exact location of the project and its area of operation. Describe the location and nearby
features such as bay, roads, mountains, etc. that is present in the surroundings.

 Lay-out

Provide the layouts of all structure, different views of the building and label each
unit/section or area as well as the fixture and furniture.

REST AREA
Workshop Toilets
Dust

Office

Bran Area
PACKING STORAGE CRAW STORAGE

Milling
Area

Blending
Area

Rejection &
Immature

STORAGE

STORAGE

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  Building Structures

Building Materials:

Enumerate the materials necessary in the creation of the structure. Make sure to reflect it
in the financial aspect.

Environmental Considerations:

 Ventilation: Ensure adequate ventilation to prevent moisture buildup and mold growth.
 Pest Control: Implement measures to prevent pests from entering the building and
damaging the rice. The cooperative will use sticky traps for pests and rodents.
 Fire Safety: Equip the building with fire extinguishers, smoke detectors, and a clear
evacuation plan.
 Noise Reduction: Consider using sound-proofing materials to reduce noise pollution.

Farm Inputs / Raw Materials

The wet palay will be source out mainly from the members.

Raw Materials Volume Amount

Wet Palay 3,528,000 kg. P63,504,000

 Labor
No. of Working Days /
Positions Daily Wage
Workers Month
Manager 1 500 20
Machine Supervisor 1 500 7
Machine operator 2 500 20
Technical Staff 2 400 20
Account Officer 2 400 20
Labor 10 382 20
Subtotal
Add: Employee Benefits (SSS, PHIC, HDMF) 2,342.5
13th month pay 175.34
Total 7,517.84

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 Utilities

Particulars Cost (monthly)

Electricity 50,000

 Environmental Safeguards

Rice milling operations can have a significant impact on the environment. To minimize
these negative effects, rice millers should implement various safeguards. These measures include
installing dust collection systems to reduce air pollution, treating wastewater to prevent water
contamination, and using energy-efficient equipment to conserve resources. Proper waste
management, including recycling and composting, is also crucial. Additionally, rice millers
should adhere to environmental regulations and engage with local communities to address any
concerns. By adopting these practices, rice millers can contribute to a healthier and more
sustainable environment while ensuring efficient and profitable operations.

State how the group will cope or minimize the bad effects and waste of the project to
protect the environment

 Production Cost

Particulars Amount

Farm Inputs / Raw Materials 63,504,000.00

Labor 804,408.88

Overhead 16,446,663.00

Total 80,755,071.88

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II.3 Organizational & Management Aspect
 Proponent

History, name, leadership and development of the group in minimum of three paragraphs

Key Motivations:

 Enhanced Economic Opportunities: Cooperatives can provide members with access to

collective bargaining power, enabling them to negotiate better prices for inputs and
secure more favorable terms for their produce. This can lead to increased income and
improved financial stability for individual farmers.
 Shared Resources and Infrastructure: By pooling resources, members can invest in
shared assets such as machinery, equipment, and storage facilities. This can reduce costs
for individual farmers and improve efficiency.
 Improved Access to Services: Cooperatives can provide members with access to
essential services, such as credit, training, and technical assistance, which may be
difficult to obtain individually.
 Risk Management: Cooperatives can help members manage risks associated with
farming, such as crop failures or market fluctuations, through collective action and risk-
sharing mechanisms.
 Community Development: By working together, farmers can contribute to the overall
development of their community through initiatives like infrastructure improvements,
social programs, and environmental conservation.

By forming (Name of group), the 34 farmer cooperators sought to harness the power of
collective action to achieve these goals and create a more prosperous and sustainable future for
themselves and their community. Currently, the cooperative has a total 126 members.

 Type of Organization

Explain what type of organization (asociatio, coop). registration number and more about the org.

Office Address: National Highway, Badtasan, Kiamba, Sarangani Region XII

(SOCCSKSARGEN)

State the offices, branches and .complete address

Area of Operation: Municipality/City

Area where the product will be disposed, area of operation and where to extend

Common Bond of Membership: Associational

The common bond of membership for BAFARMCO is associational. This means that members
are united by their shared interest in agriculture and their desire to benefit from the cooperative's
services. The membership requirement likely involves being a member of the Badtasan Farmers
Irrigators Association of Kiamba, Sarangani Province Incorporated.

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Composition of Members: Members of Badtasan Farmers Irrigators Association and other
farmers of Kiamba, Sarangani Province Incorporated

Who are the members, in two paragraphs

 Organization and Structure

Job Function and Responsibilities

The table provides a detailed overview of the various job functions and their
corresponding responsibilities within the organization. The "Job Function" column lists
the specific roles. The "Responsibilities" column outlines the tasks and duties associated
with each role. By analyzing this table, you can gain a clear understanding of the
organizational structure, the division of labor, and the specific tasks and responsibilities of
each position within the organization. This information is valuable for understanding the
workflow, identifying potential bottlenecks, and ensuring efficient and effective
operations.

Job Description Duties and Responsibilities

The Board of Directors is the governing body of BAFARMCO.
They are responsible for overseeing the cooperative's overall
Board of Directors
operations, making strategic decisions, and ensuring compliance
with relevant laws and regulations.
The Chairperson presides over board meetings, represents the
Chairperson
cooperative externally, and provides overall leadership.

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 The Vice-Chairperson assists the Chairperson and acts as a
Vice-Chairperson
substitute in their absence.
The Secretary records and maintains minutes of board
Secretary meetings, handles correspondence, and ensures proper
documentation.
The Treasurer manages the cooperative's finances, including
Treasurer
budgeting, accounting, and financial reporting.
Oversees the election process for board members and other
Election Committee
cooperative positions.
Reviews the cooperative's financial statements and ensures
Audit Committee
compliance with accounting standards.
Enforces ethical standards and conducts investigations into any
Ethics Committee
ethical violations.
Mediation and Resolves disputes and conflicts among members through
Conciliation Committee mediation or conciliation.
Education and Training Organizes training programs and workshops for members to
Committee improve their skills and knowledge.
Gender and Development Promotes gender equality and women's empowerment within
Committee the cooperative.
Evaluates loan applications and manages the cooperative's
Credit Committee
credit programs.
The General Manager is responsible for the day-to-day
General Manager operations of the cooperative, including managing staff,
overseeing projects, and implementing the board's decisions.
The Account Officer handles financial transactions, including
Account Officer receiving payments, issuing invoices, and reconciling
accounts.
The Bookkeeper maintains the cooperative's financial records,
Bookkeeper
including general ledger and subsidiary ledgers.

 Office Facilities

The table provides a detailed list of the cooperative's office assets, including their
purchase costs and estimated useful lives. This information is essential for tracking and
managing the cooperative's fixed assets. The "Name of Assets" column lists specific items like
desks, computers, and printers. The "Cost" column indicates the purchase price of each asset,
while the "Estimated Useful Life" column estimates how long the asset will be used before
needing replacement. By tracking this information, the cooperative can calculate depreciation
expenses, manage its assets effectively, and make informed decisions about when to upgrade or
replace equipment. All the assets listed below are existing assets of the cooperative.

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Name of Assets Cost Estimated Useful Annual
Life Depreciation
Furniture and Fixtures:
Desks
5,000.00 5 yrs 1,000
Chairs 1,000.00 5 yrs 200
Tables 10,000 5 yrs 2,000
Filing cabinets 5,000 5 yrs 1,000

Office Equipment:
25,000.00 5 yrs 5,000
Computers

Printers/Scanners/Photocopiers 15,000.00 5 yrs 3,000

Cellphone 7,000.00 5 yrs 14,000

Building 1,000,000 20 yrs 50,000

TOTAL 76,200

 Selling and Administrative Expenses

The table provides a breakdown of the selling and administrative expenses incurred by
the entity. These expenses include communication costs, transportation expenses, office
utilities, supplies, and fees for permits and licenses. The total selling and administrative
expenses amount to ₱633,600.

Particulars Amount (Year 1)

Communication-office 3,600

Transportation Expense – delivery of well-milled 36,000

rice

Utilities-office 15,000

Supplies 12,000

Permits and Licenses 15,000

Subtotal 81,600

Add: Depreciation 76,200

TOTAL 157,800

 Timetable

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 Explain each activity

Activity 2024 2025

Dec Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec
e

Business
Plan

Processing
and Release
of funds

Construction
of Rice Mill

Hiring and
Training of
Operators

Purchase of
Wet Palay

Dry run and

start of
operation
Monitoring
and
Evaluation

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PAGE \* MERGEFORMAT 21
II.4 Financial Aspect
 Total Project Cost

Total Project Cost

Particulars Existing To be Acquired Total
Assets
Land (1 ha) 2,500,000.00 2,500,000.00
Rotavator (2) 4,000,000.00 4,000,000.00
Hand Tractor (2) 240,000.00 240,000.00
Harvester (2) 5,000,000.00 5,000,000.00
6 wheeler Truck (2) 10,000,000.00 10,000,000.00
Building (for rice mill) 10,000, 000.00 10,000, 000.00
Warehouse (for inventories, supplies and 10,000,000.00 10,000,000.00
inputs)
Warehouse (finished goods) 10,000,000.00 10,000,000.00
Floating tiller (15) 1,050,000.00 1,050,000.00
Harvester (1) 2,500,000.00 2,500,000.00
Hand Tractor (13) 1,560,000.00 1,560,000.00
Carabao (10) 600,000.00 600,000.00
Sprayer (100) 300,000.00 300,000.00
Recirculating Dryer (3) 4,500,000.00 4,500,000.00
Rice Mill (1) 20,000,000.00 20,000,000.00
Bag closer machine (1) 20,000.00 20,000.00
Weighing Scale (2) 70,000.00 70,000.00
Sealer (5) 50,000.00 50,000.00
10 wheelers truck (2) 14,000,000.00 14,000,000.00
Forklift (1) 500,000.00 500,000.00
Office Building 1,000,000.00 1,000,000.00
Furniture and Fixtures 21,000.00 21,000.00
Office Equipment 47,000.00 47,000.00
Subtotal 22,808,000.00 75,150,000.00 97,958,000.00

Working Capital (30 days)

Direct/Raw Materials 5,292,000.00 5,292,000.00
Direct Labor 67,034.00 67,034.00
Overhead 315,667.00 315,667.00
Selling and Administrative Expenses 6,800.00 6,800.00
Subtotal 5,681,501.00 5,681,501.00

Total 22,808,000.00 80,831,501.00 103,639,501.00

Capital Requirement Percentage Amount

Existing Equity 22% 22,808,000.00
Additional Investment 78% 80,831,501.00
Total 100% 103,639,501.00

 Sources of Funds

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  Projected Financial Statement

 Income Statement

Projected Income Statement

For the years ended
Particulars Year 1 Year 2 Year 3
Sales 105,105,382.20
Less: Production Cost 80,755,071.88
Gross Profit 24,350,310.32
Less: Selling and Administrative Expenses 157,800.00
Operating Income 24,192,510.32
Less: Interest Expense
Income Before Tax
Less: Income Tax Expense
Net Income 24,192,510.32

 Cash Flow Statement

Projected Cash Flow Statement

For the years ended
Particulars Year 1 Year 2 Year 3
Cash Inflow
Sales 105,105,382.20
Loan Proceeds/Grants 80,831,501.00
Additional Investment
Total Cash Inflows 185,936,883.20
Cash Outflow
Construction of Building 30,000,000.00
Acquisition of Equipment/vehicle 45,150,000.00
Purchase of Raw Materials 63,504,000.00
Payment for Freight cost
Payment of Direct Labor 804,408.88
Payment of Production Overhead 3,788,000.00
Payment of Selling & Administrative Expenses 81,600.00
Payment of Interest Expense
Payment of Principal Loan
Payment of Income Tax Expense
Total Cash Outflows 143,328,008.88

Net Cash Flows 42,608,874.32

Add: Beginning Cash Balance 0
Cash, Ending Balance 42,608,874.32

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  Balance Sheet

Projected Balance Sheet

As of the years ended

Particulars Year 1 Year 2 Year 3

Assets
Current Assets
Cash 42,608,874.32
Raw Materials Inventory
Accounts Receivable
Total current asset 42,608,874.32

Non-current Asset
Land (1 ha) 2,500,000.00
Rotavator (2) 4,000,000.00
Hand Tractor (2) 240,000.00
Harvester (2) 5,000,000.00
6 wheeler Truck (2) 10,000,000.00
Building (for rice mill) 10,000, 000.00
Warehouse (for inventories, supplies and 10,000,000.00
inputs)
Warehouse (finished goods) 10,000,000.00
Floating tiller (15) 1,050,000.00
Harvester (1) 2,500,000.00
Hand Tractor (13) 1,560,000.00
Carabao (10) 600,000.00
Sprayer (100) 300,000.00
Recirculating Dryer (3) 4,500,000.00
Rice Mill (1) 20,000,000.00
Bag closer machine (1) 20,000.00
Weighing Scale (2) 70,000.00
Sealer (5) 50,000.00
10 wheelers truck (2) 14,000,000.00
Forklift (1) 500,000.00
Office Building 1,000,000.00
Furniture and Fixtures 21,000.00
Office Equipment 47,000.00
Total Non-Current Assets 97,958,000.00
Less: Accumulated Depreciation 12,734,863.00
Net Book Value 85,223,137.00

Total Assets 127,832,011.32

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Liabilities & Owner's Equity
Current Liabilities
Accounts Payable
Income Tax Payable
Total Current Liabilities
Non-Current Liabilities
Accounts Payable
Total Non-Current Liabilities

Total Liabilities

Owner's Equity
Equity, beginning / CBU 22,808,000.00
Add: Additional Investment
Grants/Loan Proceeds 80,831,501.00
Subtotal 103,639,501.00
Add: Net Income 24,192,510.32
Equity, ending 127,832,011.32

Total Liabilities & Owner's Equity 127,832,011.32

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 Financial Analysis

 Profitability ratios
Profitability Ratios refers to the ability of the business to generate profit for every peso of
business income.

Particulars Year 1 Year 2 Year 3

Gross Profit
GROSS PROFIT
Divided By: Gross
RATE
Sales
Gross Profit Rate

Particulars
Net Income
NET PROFIT RATE Divided By: Gross
Sales
Net Profit Rate

 Liquidity ratios

Particulars Year 1 Year 2 Year 3

Current Assets
CURRENT RATIO
Divided by: Current Liabilities
Current Ratio

 Investment analysis
Return on Investment is derived by the estimated average income of the business compared
with the investment cost. The table below shows that in every peso of income, the business will
have a 60% or P0.60 return over the life of its critical asset.

RETURN ON INVESTMENT
YEAR NET INCOME
1
2
3
TOTAL

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Divided by: Useful Life of the Major
Group of Equipment
Average Net Income
Divided by: Investment Cost
Return on Investment

 Payback period

NET INCOME + CUMULATIVE

YEAR PERIOD
DEPRECIATION TOTAL

1
2

Total investment
Less: Cumulative total when
investment is about to be
recovered- Cumulative total
(Year 1)
Investment yet to be recovered
Divided by: Cumulative total
when investment is recovered
(Net Income + Depreciation
(Year 2)
Quotient
Number of months when
investment is recovered (12 x
quotient)

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 Social Benefits and Desirability
 Direct Benefits

 Indirect Benefits

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Schedules

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