Republic of the Philippines

Department of Education
PUBLIC TECHNICAL-
VOCATIONAL
HIGH SCHOOLS

Unit of Competency: Develop a Business Plan

Module no.4 Module Title: Developing a Business Plan

 TABLE OF CONTENTS

Module 4. Identifying Business Opportunities.............................1

Pre-test............................................................................................1

LO 1. Organize the Main Parts of a Business Plan ..........................4

Let Us Study....................................................................................4
o Activity I.......................................................................5
 Problem/Need........................................................................6
o Activity II......................................................................6
 Statement of Vision, Mission and Values................................6
o Activity III.....................................................................7
 Marketing Plan.......................................................................7
o Activity IV.....................................................................7
 Production and Technical Plan...............................................10
o Activity V......................................................................10
 Organizational/Management Plan..........................................11
o Activity VI.....................................................................11
 Sustainability.........................................................................12
o Activity VII....................................................................13
 Sample of Projected Revenue..................................................14
o Activity VIII...................................................................15
 Sample of Income Statement..................................................16
o Activity IX.....................................................................17
 Social Impact.........................................................................17
o Activity X......................................................................17
How Much Have You Learned?........................................................18

Post Test..........................................................................................21
 MODULE 4

COURSE : ENTREPRENEURSHIP III

UNIT OF COMPETENCY : DEVELOP A BUSINESS

PLAN

MODULE TITLE : DEVELOPING A

BUSINESS PLAN

SUGGESTED DURATION : 20 HRS.

WHAT IS THIS MODULE ABOUT?

This module covers the knowledge, skills and attitudes required

in developing a workable business plan.

WHAT WILL YOU LEARN?

At the end of this module, you should be able to:

a. organize the main parts of a business plan; and
b. construct the preliminary parts of a business plan.

WHAT DO YOU ALREADY KNOW?

Pre-test

Let us find out how much you already know.

A. Read and understand the items being described below. Choose

the letter of the correct answer and write it in your quiz
notebook.

a. Addendum d. Target Market

b. Market Trends e. Sustainability
c. Mission f. Vision

1. It refers to a group of persons who use and patronize the

products/services that specifically fits their needs/wants.
2. These are documents or information attached to clarify or
support the information in the original document.
3. It is a clear description of goals.
4. It is a description of what the proponent sees if the problem is
solved.
5. It means support for business in environmental issues.

1
B. Multiple Choice. Read and understand the following statements
then select the letter of the correct answer and write it in
your quiz notebook.

1. It is the detailed description on how the business is

implemented.
a. evaluation plan
b. management plan
c. operational plan
d. organizational plan
2. It is the process of setting goals for a particular business
undertaking done through a step-by-step process.
a. Business planning
b. Feasibility planning
c. Marketing plan
d. Production plan
3. It gives the information on financial concerns and stability of
the plan.
a. Financial Plan
b. Marketing Plan
c. Organizational Plan
d. Production Plan
4. Business production and services are varied based
on____________.
a. innovation
b. lifestyle of the people
c. needs and wants
d. science and technology
5. This is the center of interest in a given garment.
a. balance
b. emphasis
c. harmony
d. proportion
6. It is part of a business plan which can be both within or beyond
the control of the entrepreneur.
a. mission
b. objectives
c. risk
d. vision
7. This plan is a course of action for obtaining and using the
money that is needed to implement the goals of the business
organization.
a. Financial
b. Marketing
c. Organizational
d. Production

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8. It is the place where we can buy different goods from one or a
number of vendors.
a. church
b. market
c. pack
d. school
9. The 4 P’s of a good marketing plan are.
a. Package, Place, Plan, Price
b. Plan, Place, Product, Price
c. Place, Price, Product, Promotion
d. Price, Place, Promotion, Purchase
10. It is an outline of your business.
a. Business Plan Proper
b. Executive Summary
c. Overview of the Business
d. Personal Details

3
LESSON 1

ORGANIZE THE MAIN PARTS OF A BUSINESS PLAN

WHAT IS THIS LESSON ABOUT?

This lesson presents concepts on how to organize the main

parts of a business plan.

WHAT WILL YOU LEARN?

At the end of the lesson, you should be able to:

1. organize the main parts of a business plan;
2. use survey instruments to gather data; and
3. analyze and interpret survey results.

LET US STUDY

Words to study

5Sustainability is a support for business on

environmental issues.
Addendum is a document or information attached or
added to clarify, modify or support the
information in the original document or
written work.
Target Market refers to a group of persons who use and
patronize the products/services that
specifically fit their needs/wants.
Market Trends are used to provide strategic information
and leads that will aid and sustain business
development.
Market size is the number of buyers and sellers in a
particular market.
Business Risk is the probability inherent in a firm’s
operations and environment (such as
competition and adverse economic
conditions) that may impair its ability to
provide returns on investments.

4
ACTIVITY I: The Business Plan

Directions: Recall your previous lesson on the parts of a

business plan. Then fill in the parts of the business plan in the
illustration below. Use your product concept as reference.

Parts of a
Business
Plan

5
 In organizing the main parts of a business plan one must
consider the survey instruments to gather data and the results to
analyze and interpret the business plan.

MAIN PARTS
Section 4

Business Plan Proper

I. 1THE PROBLEM/NEED

This pertains to the description of the problem/need

being addressed to, as well as the reasons/rationale why the
problem/need must be addressed by the business and the
descriptions on how the business has solved the problem/need.

ACTIVITY II

Fill in the given template of the Problem/Need of the business

plan based on your gathered data.

THE PROBLEM/NEED
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________

II. STATEMENT OF VISION, MISSION AND VALUES

4VISION
It is a description or statement of what the proponent sees if the
problem/need is solved.

9MISSION
It is a clear description of goals and objectives that presents practical
steps to achieve the vision.

VALUES
It is a clear statement of values critical to the culture, integrity and
activities of the business.

6
ACTIVITY III

Construct your own business mission, vision and values based

on your prepared product concept.

VISION
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________

MISSION
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________

VALUES
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________

III. 10THE MARKETING PLAN

A. Research and Analysis

description of the target market, market size, competition,
market share and market trends.

B. Marketing Strategies
This includes the Four P’s – price, 2promotion, product
and 3place.

ACTIVITY IV

Fill in exercises A, B and C based on your product concept and

data gathered.

EXERCISE A

MARKET PLAN

Instructions: In a group, write the market plan and be sure to include

the features of your product or service, the target audience
and your marketing strategies.

Product:________________________

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 Target Market: Who will buy your product/service? Why will they buy
it?

OTHERS
PRODUCT
AGE JOB RESIDENCE (Please
INTEREST
Specify)
___________ ___________ ___________ ___________ ___________

Competitors: Who else sells a product or service similar to yours?(List

up to 3)
a.
_____________________________________________________________________
b.
_____________________________________________________________________
c.
_____________________________________________________________________

Do your competitors have a large clientele, or they seem to be busy?

a. ___________________ b. ___________________ c. __________________

When are your competitors most busy?

HOURS DAYS MONTHS

a.____________________ ______________________ _____________________
b.____________________ ______________________ _____________________
c.____________________ ______________________ _____________________

Where do your competitors’ customers live?

a. Within one kilometer: Two to five kilometer:
b. Within one kilometer: Two to five kilometer:
c. Within one kilometer: Two to five kilometer:

EXERCISE B

MARKET PLAN

Comparison Chart of Competitors:

COMPARE COMPETITOR A COMPETITOR B COMPETITOR C

Market Share % ________________% ________________% ________________%
Quality GOOD,FAIR,POOR GOOD,FAIR,POOR GOOD,FAIR,POOR
Location GOOD,FAIR,POOR GOOD,FAIR,POOR GOOD,FAIR,POOR
Size of Facility LARGE,MED,SMALL LARGE,MED,SMALL LARGE,MED,SMALL
Prices HIGH, AVERAGE,LOW HIGH, AVERAGE,LOW HIGH, AVERAGE,LOW
Reputation GOOD,FAIR,POOR GOOD,FAIR,POOR GOOD,FAIR,POOR
Years in Business __________ years __________ years __________ years

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Pricing:
How much will you charge?______________________________________
Why will you charge this price? __________________________________
How much do your competitors charge?__________________________
Why do your competitors charge that price?______________________

Advertising

Indicate choice of sales tools: REASON FOR CHOOSING THIS METHOD

Telephone _________________________________________________________
Personal Contact _________________________________________________________
Paid Advertising _________________________________________________________
a. Newspaper Ads
b. Radio and TV
c. Posters, signs and billboards
d. Direct mail brochures, flyers, letters, samples (choose one)
Free Publicity _________________________________________________________
Using Contacts _________________________________________________________
Public Relations _________________________________________________________
Sales Promotions _________________________________________________________

EXERCISE C

MARKET PLAN

Public Relations

What can you do to get the attention of the local:

Newspapers? ________________________________________________
Magazines? ________________________________________________
TV Stations? ________________________________________________
Radio Stations? ________________________________________________
Promotions ________________________________________________

Which of the following will you use to get your product or service into
the hands of the customers? Why?
Games ________________________________________________
Coupons ________________________________________________
Special Prices ________________________________________________
Double Offers ________________________________________________
Other ________________________________________________

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IV. PRODUCTION AND TECHNICAL PLAN

The Production Paradigm

Transformation
Process
6Inputs Outputs
7ASSEMBLING
LABOR CANNING 8FINISHED
LAND CONSTRUCTING PRODUCTS:
MACHINE CULTURING BAGS
RAW MATERIALS DRAWING T-SHIRTS
SEWING FURNITURE
CANNED GOODS
MILLING
PASTRY
PRINTING
BAKING

ACTIVITY V

Illustrate your own production paradigm based on your product

concept using the box below.

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V. ORGANIZATIONAL/MANAGEMENT PLAN

includes the members of the team and the team’s contribution

to the business.

Manager-Owner

Supervisor

Clerk Clerk Helper

ACTIVITY VI

Design your own organizational/management chart based on

your chosen business.

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LESSON 2 _SECTION V
I. SUSTAINABILITY

I. Financial Plan
“Where the money comes from and where it goes.”
must be well written, sufficiently documented and
concise.

Example of financial plan:

A. Anong Sarap Bakery, the initial capital is P 40,000.00.

There will be five members. Each of the members shall
share Php 8,000.00.

B. Monthly Expenses
Table 1
MONTHLY EXPENSES

FIXED COST
Rental PhP3,000.00
Salaries:
Baker 3,500.00
Helper 3,000.00
Roller 450.00
Mixer 900.00
Slicer 200.00
Tools & Utensils 175.00
(A)TOTAL FIXED COST PhP 11,225.00

VARIABLE COST (Month)

Raw Materials
Flour PhP 3,000.00
Butter/Lard 550.00
Yeast/Leavening 120.00
Egg 1,000.00
Flavoring 500.00
Sugar 1,000.00
Telephone Bill 600.00
Electricity 1,000.00
LPG 1,000.00
Water 500.00
Transportation 1,000.00
Miscellaneous 2,000.00
(B)TOTAL VARIABLE PhP 12,370.00
COST
(A+B) TOTAL MONTHLY Php 23,595.00
COST

Table 1 shows the projected expenses per month during the

initial year of operations. It is noted that fixed cost is greater that the
variable costs.

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ACTIVITY VII

Show your projected expenses per month during the initial year of
your operation based on your product concept. Use table 1 as your
example.

FIXED COST
Rental
Salaries:

(A)TOTAL FIXED
COST

VARIABLE COST
(Month)
Raw Materials

Telephone Bill
Electricity
Water
Transportation
Miscellaneous
(B)TOTAL VARIABLE
COST
(A+B) TOTAL
MONTHLY COST

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 Table 2
PROJECTED REVENUE

Projected Projected Yearly

Types of Daily Monthly
Costing Volume Volume Projected
Bread Revenue Revenue
Daily Monthly Revenue
C – P 1.50
Peter
M - 50¢ 200 P 400.00 6000 P 12,000.00 P144,000.00
Pandesal
SP – P 2.00
C – P 4.00
Monay
M – P 1.00 100 P 500.00 3000 P 15,000.00 P180,000.00
Lisa
SP – P 5.00
C – P 4.50
Mama
M – P 1.50 50 P 300.00 1500 P 9,000.00 P108,000.00
Empanada
SP – P 6.00
C – P 1.75
Hopia Like
M - .75¢ 150 P 375.00 4500 P 11,250.00 P135,000.00
Ko
SP – P 2.50
C - P 22.00
Tasty ang
M – P 5.00 25 P 675.00 750 P 20,250.00 P243,000.00
Bread ko!
SP – P 27.00
Total 525 P 2,250.00 15750 P 67,500.00 P810,000.00
Cost – C
Mark-up - M
Selling price - SP
Table 3
MONTHLY PROJECTED COST REVENUE

  Jan Feb Mar Apr May Jun

Revenue P67,500.00 P69,187.50 P72,646.88 P79,911.56 P87,902.72 P96,692.99
Cost P23,595.00 P24,184.88 P25,394.12 P27,933.53 P30,726.88 P33,799.57
Projected P43,905.00 P45,002.63 P47,252.76 P51,978.03 P57,175.84 P62,893.42
Net Profit

Jul Aug Sep Oct Nov Dec Total

P99,110.32 P94,154.80 P91,800.93 P87,210.88 P104,653.06 P125,583.67 P1,076,355.31
P34,644.56 P32,912.33 P32,089.52 P30,485.05 P36,582.06 P43,898.47 P376,245.98
P64,465.75 P61,242.47 P59,711.40 P56,725.83 P68,071.00 P74,878.10 P700,109.33

It is assumed that the business grows by its monthly profit

because of old and new consumers of the products. August to October
are the non-peak months (5% loss from previous month is computed)
and June, November and December are the peak months (for June,
10% increase of sales from previous month and 20% for the latter
months).

Break-Even

Total Revenue (TR) = Fixed Cost (FC) + Variable Cost (VC)

When TR is greater than FC and VC means the business is earning profit.

When TR is less than the FC + VC means the business is losing.

When TR = then FC + VC, the business is break-even.

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 Table 2 & 3 showed the projected cost and revenue by month.
Based on the table the Total Revenue is greater than the combined
fixed and variable cost. It indicates that Anong Sarap Bakery has the
great potential of generating profit.
ACTIVITY VIII

Compute your projected cost and revenue by month based on you

product concepts. Use table 2 and 3 as your example.

Projected Revenue
Projected Projected Yearly
Daily Monthly
Types Costing Volume Volume Projected
Revenue Revenue
Daily Monthly Revenue

Total

Projected Monthly Revenue

Jan Feb Mar Apr May Jun

Revenue
Cost
Projected
Net Profit
Jul Aug Sep Oct Nov Dec Total

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Examples of Projected Income Statement and Cashflow

Table 4
ANONG SARAP BAKERY
PROJECTED INCOME STATEMENT
FOR THE YEARS ENDED 2008 AND 2009

2008 2009
REVENUE PhP 1,076,355.31 PhP 1,237,808.60
Cost /Expenses PhP376,245.98 Php432,682.87
Projected Net Income PhP700,109.33 PhP805,125.73
Projected Income for the year is expected to by at least rise by 15%
Table 5
CASH FLOW 1ST QUARTER OF 2008
January February March
Beginning Cash Balance P 40,000.00 P 60,310.00 P 81,127.75
Cash Inflows
Net Income P 43,905.00 P 45,002.63 P 47,252.76
P 83,905.00 P 105,312.63 P 128,380.51
Cash Outflow
Fixed Cost P 11,225.00 P 11,225.00 P 11,225.00
Variable Cost P 12,370.00 P 12,959.88 P 14,169.12
P 23,595.00 P 24,184.88 P 25,394.12
Ending Cash Balance P 60,310.00 P 81,127.75 P 102,986.39

I. For the initial operation of Anong Sarap Bakery, the

investments shall come entirely from its 5-member team
sharing equally. Each will have 20% capital share.
II. The initial source funds may be generated by special fund -
raising activities from the school. This can also be coursed -
through the YECS for the students to invest in.
III. Based on our projection the business will earn 2.5% on the first
month and 5% on the second month. Having this as a
continuing trend, it is expected that after a year, the 15% return
on investment is highly feasible.

ACTIVITY IX

Compute your projected income statement for the year ended and
cash flow for the first quarter of the year based on you product
concept. Use table 4 and 5 as you guide.

PROJECTED INCOME STATEMENT

FOR THE YEARS ENDED

REVENUE
Cost /Expenses
Projected Net Income

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 CASH FLOW 1ST QUARTER OF
January February March
Cash Balance- Beginning
Cash Inflows
Net Income
Cash Outflow
Fixed Cost
Variable Cost
Cash Balance Ending

COJEREO
II. SOCIAL IMPACT

This part includes the statement of the business long-

term desired outcomes, statement of the social impact
generated from each of the business activities and
statement/data on the benefit and impact of the business to
the community.

Social Impact Sample Form

1. Anong Sarap Bakery aspires to be the most admired
cooperative bakeshop in Marikina City. Its unique feature is
the cooperative spirit among its incorporators. In the next
years to come we want this bakery to be operative inside the
ERVHS Campus, where students can have their OJT and
they can invest in the future. ( Vision, general- nais mong
mangyari in the future)
2. Anong Sarap Bakery will conduct activities that would
promote spirit of entrepreneurship through active
participation in community and school activities since they
are the number one clientele of the bakeshop. (Choose one
activity, benefits and who)
3. (Benefits of community from your business)Our target is
to have a bakeshop where students through their OJT
program can work with. It vows to support the training
needs of the school in terms of baking, marketing, back office
operations and food service. Anong Sarap Bakery considers
itself as partner in progress of the community and school.

ACTIVITY X
Write the social impact of your chosen business by using the
given sample form.

1. Statement of the business long-term desired outcome.

___________________________________________________________.
2. Statement of the social impact generated from each of the
business activities.
___________________________________________________________.
3. Statement/data on the benefit and impact of the business to
the community.

17
___________________________________________________________.

18
LET US REMEMBER

A workable business plan maximizes the chances

of starting a viable and sustainable business.

HOW MUCH HAVE YOU LEARNED?

ACTIVITY
Prepare or develop your own business plan according to your
chosen business following the given format.

Business Name :
Location :
Name of Owner :

Introduction :
is a registered business engaged in
owned by .

Business goals are as follows:

a. The operation started on

b. The location could be reached by
c. The business could be expanded by

Table of Contents
Section I : The Business

1. Description of the Business

The business is engaged in the distribution of or production, or
of servicing customers.

2. Product/Service
The product/service is
3. Market
Production will be distributed in (mention primary and
secondary market) The clients belong to (description of the
socio-economic level). The product is bought by clients for the
following reasons:

4. Location of the Business

The business is located at
It can easily be reached by .
5. Competitors are as follows:

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 (State the name of the company and other relevant facts such as
size and possible sales)
A competitor’s profile includes price, quality, location, image
projected, strategies of selling and operations.

6. Price
The current price is _____. It is derived from the following
factors: (production cost and marked up costs) .

7. Marketing strategies
The product will be distributed in the following manner:

8. Management
The management group is composed of the following (name,
position, responsibility and qualification)

9. Personnel
The personnel needed are the following (enumerate the type of
work and their qualifications)

Summary of Section One

Section II: Financial Data

1. Sources and application of funding:

Secure financial assistance from

For the following purposes

Using the following collaterals

2. Capital Equipment List

The capital and equipment lists are the following:

Briefly describe the equipment and their uses. Include

processes employed in the production)

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3. Balance Sheet(1)
This is a statement of the financial condition of an enterprise at
a given point in time usually only a focus, quarterly, semi-
annually or annually. It shows the owner how money has been
invested and the accrued profit or losses.

4. Break-even Analysis(2)
(It is a tool used by an entrepreneur in solving managerial
problems). It compares the total resources (TR) with the total
cost (TC)

TR represents income while TC represents expenses of the

enterprise. When TR is greater than TC, there is profit(3). But
when TR equals TC it is break even(4). There is no profit, nor
loss. 7 loss

5. Income Projection (Profit-Loss Statement)

a. Detailed by month5(for the first year)
b. Detailed by quarter 6(for the 2nd, 3rd, 4th, 5th)

21
 KEY TO CORRECTION

Pre-test
A. 1. F
2. A
1. C
2. C
3. E
B. 1. C
2. A
1. A
2. C
3. A
4. C
5. A
6. B
7. C
8. B

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