LAPEKINDICA - Caffè Verde The Coffee of Green and Healthy
LAPEKINDICA - Caffè Verde The Coffee of Green and Healthy
LAPEKINDICA - Caffè Verde The Coffee of Green and Healthy
A Feasibility Study
Presented to the Faculty of
Sto. Tomas National High School
Menzi, Sto. Tomas, Davao del Norte
JUNE 2021
1
EXECUTIVE SUMMARY
This feasibility study attempted to determine the financial viability of an organic cafe in Sto.
Tomas, Davao del Norte. The researchers sought to prove the feasibility of this business through the
evaluation and presentation of the different aspects concerned in its establishment. Through this
summary, the business concept will be explained and the feasibility of the business will be proved.
Coffee drinkers are the majority of the people of the Philippines. The increasing number of
coffee shops in almost every corner of the metro is the clearest sign that the coffee industry is booming.
Drinking coffee has become an unavoidable trend, whether as a form of social activity or simply a
favorite pastime, drinking coffee has become an inevitable trend. Caffè Verde: the Coffee of Green
and Healthy is a cafe where they offer health-conscious food and beverages, especially caffeine-free
coffee, which is situated in Sto. Tomas, Davao del Norte. The proponents have chosen this location as
the commercial building remains new and many people visit it. The residents of Barangay Tibal-og are
also convenient because it is situated only near the public market, which is home to many people from
the various areas and subdivisions of the barangay. The place are very accessible to the residents and
especially to the target markets of the cafe such as bus and jeepney drivers, as well as to the vendors,
who are early risers and would like to have a sip of coffee before starting their own business and to those
Caffè Verde’s marketing strategy is to show people that it has an excellent product, convenient
accessibility, and with a community benefit. The product will be a range of hot and cold coffee-based
beverages and frappes similar to the market produced by well-trained baristas. The cafe’s pricing is
affordable to priced high and the average price of beverages is between P15.00- P150.00. The coffee
shop will be implementing a low cost promotion campaign which will include flyers, banners and
Caffè Verde will be directly under the supervision of the partners, Miss Charmie Lhyn Lape and
Miss Krishea Kaye Kindica. The functions of Marketing, Finance and Administrative will be handled by
the Supervisor but will be under the partners’ stewardship while another will be the Head Barista and
Head Cook, and will be in charge of the Production aspect. Personnel for the Coffee shop will come
position. There are two functioning groups within the Coffee Shop: Production and Marketing, Finance
and Administrative. Production involves the Baristas, Cook or production staff, who will be operating
the coffee shop and blending the beverages for the customers as well as the daily inventory, maintenance
of equipment and the bar area. Marketing, Finance and Administrative will handle the promotion of the
coffee shop and its beverages as well as managing the training of Baristas, maintenance of equipment,
With the financing carried by the partners, income is expected to be derived from the first year of
operation until the fifth year projection. Net income will be incurred for the first year computed at
Php79,950.
Return on Equity is computed at 20% by the second year which is significantly efficient in terms
The proposed income generating project is deemed feasible and viable. It is therefore
recommended for implementation for the year 2021. Further studies on increasing customer retention
and marketing, as well as development of signature product lines are also suggested.
2.2 Overview of the Business Concept 4.2.8 Motivating and Rewarding Employees 19
BUSINESS CONCEPT
Introduction
The essence of coffee as a satisfying drink that most people are looking for, considering that
Filipinos consume about 21,600,000 cups of coffee a day according to Nestlé’s consumer marketing
division.
With each new year, the coffee shop industry sees new trends and innovations. And many people
are wondering how coffee can be a healthier addition to their day as the movement toward more health-
conscious living continues. With the rise of turmeric coffee, rice coffee, and other healthier choices that
are beginning to appear on coffee shop menus, supplements and new additions to coffee will see a boom
in 2021. Cold coffee options are now being promoted as healthier alternatives to sugar-laden soft drinks.
Customers may continue to prefer cold coffees as well as conventional coffees in 2021.
These drove the owners to start a new coffee shop business, “Caffè Verde: the Coffee of Green
and Healthy”, where they offer healthy food and beverages that people will love. It is because these
days people become increasingly health - conscious and that is why coffee makers also go with the trend
For the judgment of feasibility of establishing a health-friendly cafe or coffee shop, this study
will provide a historical background of the business project, description of the service, market analysis,
details in operation and management, research and policies and financial data. This study will be most
beneficial to those who want to venture into the cafe or coffee shop industry.
The Business concept of Caffè Verde is unlike any other existing traditional coffee shops in the
municipality or even in the whole province. The main factor that makes it different is the introduction of
healthy coffees in local area of Sto. Tomas, Davao del Norte. Aside from that, we will also be offering
in our menu other healthy local delicacies and beverages that can be enjoyed by the patrons, that will
Business Name
the nature of the business. The proposed name of the business, “Caffè Verde”, is derived from Italian
language which means, “Green Coffee”. The “verde” from Caffè Verde stands for the color green (berde
in Filipino language) which represents health and balance. It is associated with growth, health, renewal,
youth, harmony, freshness and fertility. It calms the nerves and helps us feel comfortable which Caffè
Verde aims to achieve to offer their customers, as well as the green and healthy food and beverages in
Caff Verde
their menu.
The business’ main offerings are food and beverages service. It will be up to the customers’ judgement
to what they would like to order in our menu. But our main products are rice coffees and turmeric
Organic rice coffees - organic rice coffee which we all know as Sara-Sara. It is an ancient term
used by the Philippines as an alternative to coffee, as it was a concoction of boiled rice germ
and caffeine-free.
Organic turmeric coffee - also known as turmeric latte. These are steamed milk beverages
flavoured with golden turmeric, nutmeg, cinnamon, and sometimes even ginger. The resultant
Other local food and beverages (Halo-halo, mais-con-yelo, durian, avocado, and mango float,
fruit smoothies, etc.)
Business Structure
Caffè Verde is a privately organized coffee shop and will be run as a partnership. When two or
more people combine money, industry, and property to form a company or business, they form a
partnership. Forming, managing, and running a business is usually simpler. They are less tightly
governed than corporations in terms of the laws regulating their establishment, and they are much more
partnership is also a good choice of legal arrangement for a new company if it is a small business with a
low turnover. The duties of running a company or business can be shared by partners. And Caffè Verde
is registered with the ownership shared by Charmie Lhyn E. Lape and Krishea Kaye A. Kindica.
Caffè Verde is located at a commercial space (2nd floor) in a commercial building along
Bougainvillea Street, Barangay Tibal-og, Santo Tomas, Davao del Norte. The proponents have chosen
this location as the commercial building remains new and many people visit it. The residents of
Barangay Tibal-og are also convenient because it is situated only near the market, which is home to
many people from the various areas and subdivisions of the barangay. The place are very accessible to
the residents and especially to bus and jeepney drivers, as well as to the vendors, who are early risers
and would like to have a sip of coffee before starting their own business.
The primary objective of this study is to provide conclusive information and important insights
for the feasibility of establishing a health-friendly cafe in terms of the following information:
Provide financial projection for potential funding, marketing and business development
CHAPTER II
SITUATION ANALYSIS
Coffee and other hot beverages are very common among Filipinos. Caffeine-sensitive people and
those who avoid caffeine-containing drinks, on the other hand, turn to coffee alternatives. Coffee
alternatives are roasted plant parts that are made into a product that produces a coffee-like brew when
mixed with hot water. They can also be used as a coffee mix. Coffee alternatives have been on the
market for a long time, such as chicory coffee or transparent beverages made from roasted cereals
(Belitz et al. 2009). Grains like rye and barley are used to make some popular coffee substitutes.
Coffee drinking is said to have originated in Kaffa, a province in Ethiopia. The Ehiopians were
the first to discover the beverage in the beans of a tropical evergreen tree of the genus Coffea. They
grounded and roasted these coffee beans, then poured boiling water on it. People in Yemen, Arabia, and
Egypt soon learned of this discovery, until coffee drinking spread in many areas in the West, and
became part of the everyday lives of people for around 300 years now.
Until Europeans began growing coffee on colonial plantations, it remained an expensive luxury
item imported irregularly in modest quantities. Until the 1690s Yemen was able to meet European
demand for the new, hot beverage that had brought forth a new sociability of the coffee house and was
fast revolutionizing the rhythms and recipes of mealtimes across Europe. The first charge of colonial
beans reached Europe in 1712, and by 1726 the VOC controlled between half and two-thirds of
worldwide coffee production. By 1740 France, Spain, Portugal, and England had founded colonial
coffee plantations in the Americas and the West Indies, many also dependent on slave labour.
emerged more or less in parallel with consumption of the true coffee bean. Europeans started coming up
with local alternatives to the exotic coffee bean in the later seventeenth century: some of these were
roasted wheat, chestnuts, rye, almonds, and oats. Rather many consider oat coffee so beneficial that they
prefer it in many aspects to true coffee’. Over the course of the eighteenth century, coffee surrogates
Industry Review
traded product after petrol on the global market. In more than 50 countries, more than 25 million farmers
are active in the production of coffee. The market for organic coffee is fueled by the many health
benefits it provides. It's high in antioxidants including polyphenols, flavonoids, and catechins, for
example. These prevent large-scale cellular degradation by stabilizing dangerous free radicals found in
the human body. Furthermore, the trend of out-of-home coffee consumption is increasing, indicating that
coffee consumption will increase in the coming years. As a result, the global organic coffee market is
expected to expand as a result of this rise. The global demand for organic coffee is expected to be driven
by the health benefits associated with coffee, as well as changing consumer trends.
According to studies, global coffee consumption continues to rise. Experts forecast that
consumption will rise in tandem with population growth. Furthermore, domestic demand grows at a rate
of 2.25 percent per year. This may be due to the rise of coffee specialty shops that appeal to a broader
In our country, no morning is complete without coffee. We have our own Batangas barako to be
proud of. Instant coffee then came into the scene, and lately, gourmet and specialty coffee with the
introduction of foreign cafés such as Starbucks, Seattle's Best, and the like. Coffee drinking has now
become more than just a way to wake up one's nerves, it has become a trend.
DRIVERS BARRIERS
• Large gap in supply and demand • Capital Intensive
• Low cost of service • Rural Area Location
• Cash Business • Acceptance in the market
• New trend in the market • Seasonal raw materials
Target Market
Our target market is determined from the number of people within the mentioned Barangays of
the said municipality. In order to identify the population demand for the proposed coffee shop for that
area in Sto. Tomas, Davao del Norte, we used the Slovin’s formula in determining the number of
young clientele (33,817) and 30-44 for the working patrons (23,716), a total of 57,593 and a 10%
margin of error. Margin of error denotes the allowed probability of committing error in selecting a small
Where:
N = Number of samples
n = Total population
e = Margin of error
57,593
Therefore: N= 2
(1+ 57,593 x 0.1 )
SWOT Analysis
Strength
• Based on its smaller size, the fact that it is not a franchise, Caffè Verde is a unique coffee shop
concept unlike any other in Davao del Norte market, for they serve organic and healthy coffees.
• Easily located
Weakness
• Franchises are the easiest way and often the safest conduit to start a café; the café will not have the
• Caffè Verde has a minimal budget and is competing against larger and more established
Opportunity
Threats
• Rising number of local fast food chains and their lower meal prices.
Chapter III
BUSINESS VIABILITY
Marketing Aspect
the area. This will be achieved by using good quality ingredients and strictly following preparation
guidelines.
In this part, the description of the market, target customers and the location of the business will
be elaborated. This also includes the competitors, the supply and demand of the business, the demand
Area Covered
The area covered refers to where the business is to be set up and the areas surrounding it.
Geographically, the target area is in Brgy. Tibal-og primarily located at Sto. Tomas, Davao del Norte.
There are a total of 57,593 people aged between 15-44 in this municipality which are the primary
The total number of people in age sub-groups was obtained from the list of National
Statistics’ Survey of Population and Household by the said municipality as of the year 2015.
Supply Analysis
Upon further research, it was found that there is no existing cafe or coffee shop around the area of Sto.
Tomas, Davao del Norte.
The partners will coordinate with a local event coordinator to organize the launching of the
business. This is one of the most effective ways in attracting customers and making them aware that
we’re “Open”. The expenses for the grand opening will be shouldered by the partners from their
personal funds.
2. Light Signage
This is a common way to direct customers to your shop. It must be clearly readable and
recognizable from the street so that customers will easily identify and find your business place. The
lighting is important during night hours. According to business.ph, a common sized signage costs
contact number, business hours and business slogan. The design will be personally done by the partners
and the total amount of Php2500.00 will be allotted for the printing and distribution of the leaflets and
flyer.
After the business become stable and the cafe already established their very own
customers. Caffè Verde will distribute loyalty cards to those frequent individuals who will buy 8 cups of
the Php 50.00 (medium cup) of any organic coffees, They can also avail an on the house coffee in any
5. Promos
Caffè Verde will also offer a promo where the customers will have chances to win prizes, like
free biko or a cup of coffee, underneath the paper cups. Monthly promos will likewise be offered. Every
January of the year, the coffee drinks will be offered on “Resolu-cups” where customers can write in the
coffee cups their resolutions for the year and will be placed on a designated spot in the shop. During the
Valentine’s weekend, a 50% discount will be given on the second coffee drink for every one coffee
drink bought in a single purchase. And on December, the coffee shop will offer a 15% Christmas
discount in every coffee and biko pair bought. There will also be a group promo on the months of
August to October and January to March where you can have a free cup of coffee drink on every five
(5)cups of coffee bought in a single purchase. And during the anniversary week of the coffee shop, 25%
discount on all rice cake products will be offered to every customer and an additional 30% discount,
Tagline
Mission Statement
To establish a trusted predecessor in coffee businesses in the greater of Davao del Norte.
Heading the innovation, service and quality sector, that promotes local rice farmers and producers to
environment.
Vision Statement
Caffè Verde as a coffee shop dedicated to bring the best in providing high-quality and organic
coffee drinks in coffee bags and serve healthy foods in silver platter, to empower local farmers and their
goods, to demonstrate the pleasing Filipino lifestyle and culture, using environmentally friendly
products and enhancing employee satisfaction while providing their shareholders with a stable return.
Core Values
INTEGRITY
Be transparent in communication and honest as integrity is the foundation of our guiding principles.
SOCIAL RESPONSIBILITY
To treat our employees with respect and dignity they deserve and take preservation to our environment.
ACCESSIBILITY
Be considerate for our customers in terms of a fair price value of a satisfactory kind of service and
Manpower Requirements
a) Supervisor
Male or Female
• Computer Literate
b) Service Crew
c) Barista
Male or Female
•Extremely knowledgeable about making coffee and mixing coffee and other beverages.
d) Cook
Male or Female
Male or Female
• Work willingness
• Multitasking ability
• Considerate
Organizational Structure
SUPERVISOR
COOK BARISTA
A) Partner C
B) Partner K
C) Supervisor
• Monitors the team’s performance and reports to the partners when required
• Must be able to demonstrate skills in business, managerial knowledge and smooth interpersonal
• Attracts patrons by developing and implementing marketing, advertising, public and community
relations programs; evaluating program results; identifying and tracking changing demands.
• Maintains patron satisfaction by monitoring, evaluating, and auditing food, beverage, and service
D) Barista
• will be extremely knowledgeable and offer assistance in any coffee purchase while simultaneously
F) Service Crew
• Greets guests and suggestively sells and fills food and beverage orders.
• Provides customers with a quick and accurate service and show sensitivity to their individual
needs.
• Prepares food and drinks offered involving use of a broad range of equipment and tools.
• Handles cash, credit card and discount transactions with the assistance of a POS (Point of Sale)
register.
• Verifies a starting bank and completing a daily audit report when balancing the drawer at the end
of the shift.
• Straightens chairs and tables, and maintains a clean, sanitized food service area by picking up
• Uses a variety of cleaning utensils and chemical cleaning products along with the correct
protective equipment.
• The one who ensures the cleanliness and orderliness of the coffee shop before and after each shifts.
Aside from the basic salary and necessary benefits given to the employees, 13th Month Pay must
be given as stated in the 13th Month Pay Law, Memorandum Order, P.D. No. 851 and also, De Minimis
Benefits such as Uniform Allowance and Laundry Allowance. Furthermore, it is important for the
partners to have a tight bond with their employees to avoid hostility and to promote trust and loyalty.
There will also be celebrations during special occasions such as Birthdays, Christmas and New Year to
Coffee Drip Kettle Dripper and Pot Drip Station Coffee Drip Scale Bar Spoons
Automatic Drip
Blind Filter Basket Rancillo Classe7E
Tong Spatula Coffee Maker
Espresso Machine
Glasses
Floor Plan
FIRE EXIT
COUNTER
READING
AREA
RECEPTION
ENTRANCE
Floor Sketch
Operational Procedure
Business Culture
provide ongoing coaching and directions. When an employee arrives, they should sign in to the record
book, which will include their time in and out as well as their signature, in order to keep track of their
daily time records. Customers will be greeted by the service crew as they enter the coffee shop, and they
will be assisted in placing their food and coffee orders. The barista will be in charge of creating the
coffees, while the cook will be in charge of the kitchen cooking. The whole amount traded from clients
will be returned to the asset custodian at the end of the day's operations.
Legal Aspect
Financial Aspect
The purpose of this is to provide proof on the financial feasibility of the Caffè Verde: the Coffee
of Green and Healthy. This will focus on the assessment of the projected starting capital investments,
expenses, revenues, disbursements and returns. The results in this aspect will be most
relevant to investors who are planning to venture into the cafe industry.
• The business will operate as a General type of partnership wherein the partners will be considered
General Partner.
• The revenue of the company will be generated from the coffee and food products to be sold by the
company.
Project Financing
The proposed business’ initial investment will be P 500, 000 which will be divided to the partners. Their
capital contribution will be coming from their savings or loans. In order for them to sustain the
Lape
50% 50%
Kindica
The partners’ equity and their share in the profit and loss would be based on the partners’
Project Cost
PROJECT COST
CAPITAL EXPENDITURE
Furniture and Fixtures ₱200,000.00
Tools and Equipment ₱200,000.00
TOTAL ₱400,000.00
WORKING CAPITAL
Initial 2021
Beginning Capital ₱500,000 ₱500,000
Add: Net Income 79,950
₱500,000 ₱579,950
Beginning Capital
Lape ₱250,000 ₱289,975
Kindica 250,000 ₱500,000 289,975 ₱579950
Ending Capital ₱500,000 ₱579,950
2022 2023
Beginning Capital ₱579,950 ₱711,290
Add: Net Income 131, 340 145, 812
₱711,290 ₱857,102
Beginning Capital
Lape ₱355,645 ₱428,551
Kindica 355,645 ₱711,290 428,551 ₱857,102
Ending Capital ₱711,290 ₱857,102
2024 2025
Beginning Capital ₱857,102 ₱1,013,095
Add: Net Income 155, 993 158, 468
₱1,013,095 ₱1,171,563
Beginning Capital
Lape ₱506,647.50 ₱585,781.5
Kindica 506,647.50 ₱1,013,095 585,782 ₱1,171,563
Ending Capital ₱1,013,095 ₱1,171,563
Table 10: Statement of Changes in Partners’ Equity
A statement of the assets, liabilities, and capital of a business or other organization at a particular
point in time, detailing the balance of income and expenditure over the preceding period.
INITIA
2021 2022 2023 2024 2025
L
ASSETS
Current Assets
LIABILITIES &
CAPITAL
Current Liabilities
Accounts Payable 0 0 0 0 0 0
Partners' Capital
₱250,00 ₱268,44 ₱336,11 ₱409,02 ₱487,017. ₱566,251.
Lape, C.L.
0 5 5 1 5 5
566,251.5
Kindica, K.K. 250,000 268,445 336,115 409,021 487,017.5
0
₱500,00 ₱536,89 ₱672,23 ₱818,04 ₱1,132,50
TOTAL LIABILITIES ₱974,035
0 0 0 2 3
& CAPITAL
Table 11: Statement of Financial Position
Projected Income Statement
An income statement or profit loss account is one of the financial statements of a company and
shows the company’s revenues and expenses during a particular period. It indicates how the revenues
Profitability Analysis
All non-operating revenues and expenses are not taken into account because the purpose of this ratio is
2. Return on Assets
Return on Assets (ROA) is a financial ratio that shows the percentage of profit a company
earns in relation to its overall resources. It is commonly defined as net income divided by total
assets.
3. Return on Equity
Results of the projected income statement, projected statement of financial position and
profitability analysis under the base case show that the project is feasible and viable. This is based on the
positive net present value and return on equity greater than the cost of capital or prevailing interest rate.
The projected information is deemed relatively low in risk with a high market sustainability and possible
growth, especially the business has no direct competitor around the area. Therefore, it is recommended
that the partners proceed with operating Caffè Verde as an income generating project of the institution by
A number of actions are recommended for the business. First, the business has to maintain high
customer traffic in its store to sustain all sales targets. This would include studies on maximizing store
hours and including weekends in store operations. Second, ensuring sustainability will require a periodic
evaluation of strategies used on all aspects of the venture and adjusting the strategies to fit the needs and
wants of customers. Extensive promotion of products is recommended through a launch of the Caffè
Verde complete with social media exposure which the institution can harness through media
connections. Moreover, grassroots promotion within the public market is suggested through taste tests in
the various buildings and periodic promos for repeat customers. Congruent to the strategy in customer
service is ensuring that the personnel producing the coffee and beverage are in high morale and
effective. It is then proposed that an incentive scheme be studied for all employees of Caffè Verde.
Further studies on ensuring consistency in taste and production efficiency is also recommended,
including time and motion studies. The cafe will also benefit in developing its own distinct product line
such as the organic coffees of Caffè Verde and introducing a signature taste on some of its beverage.
https://tacadaojmd.wixsite.com/sarasararicecoffee
https://www.intoxicatingspaces.org/2019/11/18/faking-it-a-little-history-of-coffee-substitutes/
https://sarasararicecoffeeblog.wordpress.com/
https://www.bar.gov.ph/index.php/digest-home/digest-archives/100-2001-3rd-quarter/3368-july-
sep01-the-philippine-coffee-industry-a-profile
https://esquirescoffee.co.uk/news/coffee-shop-trends/
https://www.philatlas.com/mindanao/r11/davao-del-norte/santo-tomas.html
https://www.philatlas.com/mindanao/r11/davao-del-norte/santo-tomas/tibal-og.html