CHAPTER 1: INTRODUCTION

Background of the Study

The poultry industry in the Philippines has enjoyed remarkable success within
the livestock and poultry sector for several decades (Ilagan and Yco, 2017). It has been
one of the most flourishing businesses in the country, contributing significantly to the
agricultural and economic development of the nation. The Department of Agriculture
recognizes chicken meat and eggs as among the most progressive animal sectors in
the Philippines, emphasizing the importance and potential of the poultry industry at
the local level (Cabaral and Rieta, 2018).

The local broiler industry in the Philippines, particularly in Bontoc, Mountain

Province, has experienced significant growth and success. Small-scale farmers and
backyard poultry raisers have played a crucial role in the development of the industry
by capitalizing on the increasing demand for chicken meat (Ilagan and Yco, 2017).
These farmers have adopted modern production techniques and management
practices to improve productivity, increase market competitiveness, and generate
income for their families and communities.

The success of the Bilig Bengasan Data Mat-ao Farmers Organization

(BBDMFO) in implementing a backyard poultry project showcases the importance of
external support and collaborative efforts in promoting local agricultural development.
Despite challenges faced by the BBDMFO, such as limited resources and access to
markets, they addressed gaps in the absence of locally-raised chickens by leveraging
support from the Department of Agriculture - Special Area for Agricultural
Development (DA-SAAD) Program. This success story highlights the potential for
market development and income generation within indigenous communities with the
right support and initiatives. (Ciasico, F.2022)

Focusing on the region with the highest poultry meat production in the
Philippines, farms in Central Luzon have undergone a thorough quantitative
assessment of biosecurity measures. This assessment ensures compliance with
policies aimed at enhancing the quality of broilers in the country (Ancog et al., 2020).
Biosecurity measures include strict hygiene protocols, controlled access to farms, and
disease surveillance to prevent the spread of pathogens and maintain the health of

1
broilers. By implementing stringent biosecurity measures, the poultry farms in Central
Luzon aim to safeguard the health and well-being of their broilers while maintaining
high production standards.

The Central Luzon region, known as the "Poultry Capital of the Philippines," has
a conducive environment for poultry production due to its favorable climate,
availability of feed ingredients, and proximity to major markets (Ancog et al., 2020).
Large-scale farms in the region have adopted modern technologies and practices to
achieve economies of scale and meet the growing demand for broiler meat. These
farms employ advnced breeding techniques, efficient feed conversion systems, and
automated production processes to maximize productivity and ensure high-quality
broilers.

Research on the global meat production industry has revealed the remarkable
expansion of the poultry sector, particularly in developing countries. Various studies
conducted worldwide have highlighted the growth trend of the poultry industry,
shedding light on the factors contributing to its rise (Delgado et al., 1999; Taha, 2003;
Landes et al., 2004; Conroy, 2004). The poultry industry has become a vital
component of the global food system, providing affordable and nutritious animal
protein to a growing global population.

In the case of the Philippines, there has been a surge in poultry production,
further reinforcing the significance of this sector within the country's agricultural
landscape (Costales et al., 2003). The increasing demand for poultry meat, driven by
population growth, rising incomes, and changing dietary preferences, has spurred the
expansion of broiler production in the country. The Philippines has positioned itself as
a major producer and exporter of broiler meat, capitalizing on its competitive
advantage in terms of production efficiency and favorable market conditions.

Overall, the broiler-producing industry in the Philippines is thriving, and its

success is evident at the local, regional, international, and global levels. The industry's
growth is fueled by the efforts of small-scale farmers and backyard poultry raisers at
the local level, the adoption of advanced technologies and biosecurity measures at the
regional level, and the increasing demand for poultry products at the international and
global levels. Additionally, the importance of food processing in meeting consumer
preferences and market demands cannot be understated. Understanding the dynamics
2
and implications of this industry is crucial for policymakers, researchers, and
stakeholders to further promote its sustainable development and economic impact.

Considering these factors, the burgeoning demand for chicken meat presents a
promising market opportunity for chicken farming and food processing businesses.
The growth of the poultry sector in developing countries, including the Philippines,
indicates a potential for increased production and consumption of chicken meat. This,
in turn, opens avenues for investment in poultry farming. Processing facilities,
distribution networks, and related industries.

The group has identified a lucrative business opportunity in supplying poultry

products. With the rising demand for chicken meat and eggs , establishing a chicken
farming business holds great potential for success.

Chicken farming, or poultry farming, is an integral part of the agricultural

industry and plays a crucial role in meeting the growing consumer demand for
protein-rich meat (Food and Agricultural Organization, 2020; Chadd, Davies, &
Koivisto, 2023). It involves the rearing of chickens for meat production, typically
focusing on broiler chickens, which are specifically bred for their meat. Chicken
farming encompasses various aspects, including breeding, hatching, raising, and
processing of chickens for consumption. Sustainable practices in chicken farming
have gained significant attention in recent years, focusing on the well-being of the
chickens and the quality of the final product. Youssef et al. (2020) highlight the
importance of proper nutrition, housing, and healthcare in ensuring the welfare of the
chickens and enhancing the quality of the meat. By adopting sustainable practices,
the proposed chicken farming business in Maligcong can differentiate itself in the
market and provide consumers with high-quality poultry products.

The establishment of this chicken farming business seeks to address the

scarcity of locally produced poultry products in Maligcong, Bontoc, Mountain
Province. Currently, the community heavily relies on a single poultry farm to meet
their poultry needs. This limited supply creates challenges in terms of availability and
price stability. The community often faces situations where the poultry farm is unable
to meet the growing demand, resulting in shortages and difficulty in accessing fresh
poultry products. Additionally, relying on a single source of poultry products poses
risks in terms of supply chain disruptions, such as disease outbreaks or logistical
3
issues. By establishing a chicken farming business in Maligcong, the proposed venture
aims to bridge this gap and increase local production of poultry products. This
initiative will not only provide an alternative and reliable source of poultry products for
the community but also contribute to the overall food security of the region. With the
business's strategic location in Maligcong, it can directly cater to the local market's
needs, ensuring a more consistent and accessible supply of fresh poultry products.

Our business is centered on the production and sale of eggs and live chickens.
We acquire chickens that are ready for laying eggs, allowing us to supply fresh and
high-quality eggs to consumers. These eggs will be sold directly to customers,
ensuring a steady source of nutritious and delicious eggs. Additionally, we also sell
non-laying chickens as live birds, providing an alternative option for customers who
are interested in acquiring chickens for meat consumption or home cooking. By
offering both eggs and live chickens, we aim to cater to a diverse range of customer
preferences and meet their demands for quality poultry products.

Furthermore, the chosen location of Maligcong, Bontoc, Mountain Province

offers a unique opportunity to contribute to the economic development of the area. The
region's favorable climate for poultry farming, coupled with its agricultural heritage,
provides a solid foundation for the proposed chicken farming and food processing
business. Through job creation, support for local farmers, and the potential for Agri-
tourism, the business can stimulate economic growth, improve livelihoods, and
enhance the overall well-being of the community and Mountain Province as a whole.
This aligns with the larger goal of promoting sustainable development and harnessing
the region's agricultural potential.

4
Research Objective
The objective of this feasibility study is to assess the viability of the proposed
chicken farming business by thoroughly examining the five aspects of feasibility:
Marketing Aspect, Technical Aspect, Management Aspect, Socio-Economic Aspect, and
Financial Aspect. The specific objectives are as follows:
1. Marketing Aspect:

a. Determine the potential demand for chicken products in the target market.
b. Identify the target market segments and their preferences for chicken
products.
c. Evaluate the competitiveness of the proposed business in the market.
d. Analyze marketing strategies to promote and sell eggs and chickens
effectively.

2. Technical Aspect:

a. Assess the technical requirements for chicken farming operations.

b. Evaluate the availability and suitability of resources, such as land,
infrastructure, and equipment.

3. Management Aspect:

a. Evaluate the management team's capabilities and experience in the poultry

industry.
b. Assess the organizational structure and human resource requirements.
c. Determine the management systems and procedures necessary for efficient
operations.

4. Socio-Economic Aspect:

a. Assess the social and environmental impact of the proposed business.

b. Evaluate the compliance with local regulations and standards.

5
 c. Determine the potential contribution to the local economy, including job
creation and income generation.
d. Identify any potential social or community- related challenges and propose
mitigation measures.

5. Financial Aspect:

a. Conduct a comprehensive financial analysis, including investment costs,

operational expenses, and revenue projections.
b. Assess the financial feasibility of the proposed business, including
profitability, return on investment, and payback period.
c. Identify potential sources of funding and evaluate the financial risks.
d. Develop a financial plan and determine the required financial resources.

Through the fulfillment of these objectives, this study aims to provide a concise
assessment of the viability of the chicken farming business, facilitating informed
decision-making.

6
CHAPTER 2: METHODOLOGY

Research Design:
This feasibility study utilizes a quantitative research design to evaluate the
viability of the proposed project. The research will rely on quantitative methods,
including surveys and financial analysis, to collect and analyze data. This quantitative
research design will provide measurable data to evaluate market demand, financial
feasibility, and production capacity, informing the decision-making process for the
proposed project.

Population and Locale of the Study:

The study titled "Viability of Chicken Farming " aims to assess the feasibility
and potential for establishing chicken farming operations in the picturesque
community of Maligcong, located in Bontoc, Mountain Province. The area is home to a
diverse population creating a dynamic local market.
The target market of the study would be the 152 households will be chosen based on
the Yamane's formula, taking into account the total number of households in
Barangay Maligcong, which is 245.

Breakdown of how we determine the sample size using Yamane's formula for a
population of 245 households in Barangay Maligcong:

Step 1: Identify the values

- Population size (N): 245 households
- Desired level of precision (e): 0.05 (5%)

Step 2: Plug the values into the formula

- n = N / (1 + N * e^2)
- n = 245 / (1 + 245 * 0.05^2)

Step 3: Simplify the equation

- Calculate the value of e^2: 0.05^2 = 0.0025
7
- n = 245 / (1 + 245 * 0.0025)
- n = 245 / (1 + 0.6125)
- n = 245 / 1.6125

Step 4: Perform the division

- n ≈ 151.02

Step 5: Round the result

- Since the sample size represents the number of households, it should be a whole
number. Therefore, we round the result to the nearest whole number:
- n ≈ 152

So, based on Yamane's formula, the required sample size for a population of 245
households in Barangay Maligcong would be approximately 152

Figure 1: Favarey, Maligcong, Bontoc, Mountain Province

Data Gathering Tools:

To gather data for the proposed study, the primary tool utilized is surveys
administered online or offline. The development of the surveys involved a thorough
review of existing literature, industry reports, and academic studies related to chicken

8
farming. This comprehensive literature review helped identify key topics, themes, and
research gaps that were explored through the surveys. By conducting this literature
review, valuable insights into important factors, trends, and variables within the
poultry industry were gained, which were then utilized to formulate targeted survey
questions aligned with the research objectives. In addition, local market research was
conducted to gather pricing information. This involved interviews with local wet goods
vendors in Bontoc, enabling direct engagement with store owners and managers to
obtain accurate and up-to-date pricing data. By utilizing surveys and local market
research, the study aims to gather specific data aligned with the research objectives,
ensuring a comprehensive and informed analysis.

Data Gathering Procedure:

The research procedure for this study primarily relies on printed survey forms
for data collection. The process begins by seeking approval from the office of the Mayor
of Bontoc through a letter of consent to distribute and collect surveys in the area.
Printed survey forms are prepared and distributed directly to households within the
target population. This approach ensures that a representative sample of the
population is included in the study. A specified timeframe is provided for respondents
to complete and return the survey forms, allowing for efficient data collection. By
utilizing printed surveys and distributing them directly to households, the study aims
to gather comprehensive and reliable data from the target population.

Treatment of Data:
After collecting surveys, we will proceed with the treatment and analysis of the
gathered data.
We utilize summary statistics to analyze the numerical data obtained from the
surveys. Summary statistics provide an overview of the data's characteristics, allowing
us to understand the central tendencies and variability within the dataset. We will
calculate measures such as the total number of respondents, response frequencies,
and percentages to summarize the survey responses. These statistics will provide a
concise summary of the data and help identify any notable trends or patterns that
emerge from the analysis.
9
CHAPTER 3: RESULTS AND DISCUSSION

MARKET STUDY

a. Market Description

Our business primarily targets a specific market segment consisting of 152

households, representing approximately 18.19% of the total households. Through
market research and customer feedback, we have gained valuable insights into the
preferences and purchasing behavior of these households, enabling us to effectively
position our offerings. By focusing on understanding the needs and preferences of our
target market, we are well-positioned to meet their demands and establish a strong
presence in the market. Our commitment to delivering value, fostering strong
relationships, and adapting our strategies over time will help us maintain or increase
our market share within this target market.

b. Product Description
We have chosen to acquire Lohmann Layers chickens for our chicken farming
business. Lohmann Layers are known for their exceptional laying capabilities,
consistently producing a significant number of high-quality eggs throughout their
lifespan. This allows us to provide a reliable and abundant supply of eggs to our
customers. Additionally, Lohmann Layers chickens also offer good meat quality, which
adds value to our product offerings.

1. Eggs

10
 Figure 2: Eggs

Eggs may be categorized and priced in accordance with their sizes. The sizes of eggs
are listed in the table below along with the weights that correlate to each size:
Egg Size Weight
1. Pullet or Peewee Less than 42 grams
2. Small 42-49 grams
3. Medium 49-56 grams
4. Large 56-63 grams
5. Extra Large 63-70 grams
6. Jumbo More than 70 grams
Table 1: Egg Categories

2. Chicken Meat
Our poultry will be selling live chicken for processed meat when the business
decides to cull hens. Culling hens refers to the identification and removal of the non-
laying or low producing hens from a laying flock. Unless the birds are diseased, they
are suitable for marketing or home cooking.

Figure 3: Chicken Meat

11
 c. Demand and Supply Analysis

Projected demand
The projected demand data provides estimates for the expected demand of eggs
and live chicken over a three-year period. The demand for different sizes (pee wee,
small, medium, large, extra-large, jumbo) and live chickens sis provided annually,
with weekly, monthly, and yearly frequencies. The demand gradually increases over
the years.
Products Target Frequency Demand Annually
market
Wkly. Mo. Yr.
2 8 104
Year 1 Year2 Year 3
Eggs
Extra Small 12 24 96 1,248 1,248 1,275 1,285
Small 16 32 128 1,664 1,664 1,700 1713
Medium 21 42 168 2,184 2,184 2,231 2,249

Large 34 68 272 3,536 3,536 3,613 3,643

Extra Large 41 82 328 4,264 4,264 4,356 4,391
Jumbo 28 56 224 2,912 2,912 2,975 2,999
Sub Total 304 1,116 15,808 15,808 16,150 16,280
Product Target Frequency Demand
market annually
Wkly. Mo. Yr. Year1 Year 2 Year 3
1 4 52
Chicken 152 152 608 7,904 7,904 8,075 8,140
Sub Total 152 608 7,904 7,904 8,075 8,140
Total 23,712 24,225 24,420
Demand
The total demand for all products increases from Year 1 to Year 3, indicating a
growing market. This data helps businesses plan production, inventory, and
marketing strategies based on expected market demand.

Table 2: Projected Demand

12
Projected supply

The projected supplies amount is determined by adding up all the expenses

incurred for supplies throughout the year. This includes costs for items such as raw
materials, office supplies, equipment maintenance, and any other supplies required
for required for daily operations. It is important to note that in our projected supplies,
we consider the inflation rate, which is 106.50%.This inflation rate accounts for the
expected increase in prices and helps ensure that the projected supplies amount
reflects the anticipated rise in costs over time.

Particular Year 1 Year 2 Year 3

Building ₱1,035,220.00
Chicken supplies 540,000 556,470 573,944.67
Chicken foods and
418,400.00 658,980 681,549
Vitamins supplies
Office supplies 934.12 991.04 1,051.99
Packaging supplies 19,887.7 21,110.79
18,735.475

Cleaning supplies 2,271.61 2,411.32 2,559.6

Utilities 86,596.98 86,596.98 86,596.98
Legal requirements
7,600 2,550.00 2,550
TOTAL ₱2,893,686.98 ₱1,326,538.185 ₱1,367,930.71

Table 3: Projected Supply

13
 d. Projected Revenue

Unit Unit price Target Projected Projected Projected

market sales (year 1) sales (year 2) sales (year 3)
Eggs
Extra Small Php 12 162,240.00 165,761.00 167,120.00
130.00
Small Php 16 299,520.00 306,019.00 308,528.00
180.00
Medium Php 21 480,480.00 490,906.00 494,931.00
220.00
Large Php 34 954,720.00 973,437.00 983,436.00
270.00
Extra Large Php 41 1,279,200.00 1,306,800.00 1,317,300.00
300.00
Jumbo Php 28 931,840.00 952,000.00 959,680.00
320 .00
Sub total 4,719,520.00 4,821,933.00 4,861,473.00
Live Chicken Php150.00 152 1,185,600.00 1,211,250.00 1,221,000.00
TOTAL 5,365,120.00 6,033,183.00 6,082,478.00
PROJECTED
REVENUE
Table 4: Projected Revenue

14
e. Market Analysis

1. Segment Rivalry
The potential competitor is the Maligcong Poultry which indicates that
there will a low level of rivalry. This gives the Chicken Farming a competitive
advantage to monopolize the residents. There is no growth rate of
competitors so there would be no significant threat.

2. Bargaining Power of Buyers

There is a need for a Chicken Farming in Maligcong as eggs and meats
are a need of a man and target customers are willing to recommend the
poultry among their friends and families. This indicates that there is a
sufficient customer base in the said place that is likely to support the
industry. Moreover, the customers have a limited bargaining power in
terms of pricing and products offered since this industry is the only
poultry that has value-added products in the area.

Chicken Farming has a favorable market opportunity in the chosen

location. The low competition in the area coupled with the need for a
poultry and positive customer recommendation indicate a strong
potential for success.

f. Marketing Strategy
Our sales and marketing strategy focuses on networking with businesses
in the agricultural supply chain that rely on daily supplies of chicken
and eggs. By targeting these potential customers, we aim to maximize
profitability. Here are the key elements of our sales strategy:

1. Giving Breakage Eggs for Free:

Offering cracked eggs as complimentary items can be an effective
marketing and sales technique. Customers appreciate receiving
additional products for free, allowing us to increase sales without
compromising profitability.

15
 2. Poultry Farm Visits:
Inviting consumers to visit our farm provides an opportunity to
showcase our operations and the exceptional care we provide to our
chickens. By offering tours and demonstrating our commitment to
quality, we can build trust and transparency. At the end of the tour,
visitors will be encouraged to select and purchase eggs at a discounted
but fair price.

3. Events or Competitions:
Holding events or competitions, such as culinary contests, allows
us to showcase our products and create brand awareness. By featuring
our products in action and presenting innovative possibilities, we inspire
customers to consider purchasing them.

By implementing these strategies, we aim to strengthen our sales

efforts, attract new customers, and drive profitability in the poultry and
egg production industry.

PRICING STRATEGY
At the outset of business, the company will implement penetration
pricing strategy. With penetration pricing, clients are drawn in temporarily with
a cheapest price. The low introductory price lowers the consumers' perceived
risk when buying new products. Penetration pricing forgoes immediate profits
in order to forge lasting bonds with customers. The strategy assumes satisfied
consumers will buy the product for full price when the offer expires. Full
transparency is critical to building positive long-term relationships with buyers.
In this context, the company will make it clear that the initial price is a limited-
time offer and that the item's full price will apply when the offer ends.
Once the business has established a good relationship with its market,
competitive pricing will be applied, specifically matched price. Our Poultry will
strategically align the prices of its products with the competitors’ pricing in the
market or niche, rather than basing prices solely on business costs or target
profit margins.

16
LOCATION STRATEGY
Our Poultry will be located at a 400-square meter plot of land at Favarey,
Maligcong, Bontoc, Mountain Province. The proprietor owns the land that will
be used for the company's operations. The location is far from a residential or
commercial district. Additionally, it is close to a road and has access to services
like electricity and water.

PROMOTIONAL STRATEGIES
Promoting products and services is one of the factors considered to
contribute for the business’s achievement. To do this, the products must be
introduced and the target market must be adequately and successfully reached.
More clients are attracted by an effective promotional campaign, which helps to
boost sales and profits. Each business employs a different form of promotion.
Therefore, there is a higher likelihood that using an unusual or distinctive
method to advertise one's goods and services will draw in more clients. The
following advertising methods will be used:

1. Personal Selling
This technique involves personal communication with
consumers/distribution channels, which involves persuading them to
buy products with the promise of a good-quality product. This will start
with the employees inviting their families, relatives, and friends to buy
the products.

2. social media
The use of social media for communication is an increasing trend.
Formal outlets such as Twitter, Facebook, and Instagram, as well as
informal outlets such as blogs and wikis, provide a platform for
marketing poultry products on the internet. Here, the products, prices,
and the location will be disclosed in the posts to provide sufficient
information to the users.

17
SWOT MATRIX

Strengths: Weaknesses:
- High-quality egg production - Limited market reach
- Ability to offer live birds - Potential disease outbreaks
- Potential for diversification - Dependence on external factors

Opportunities: Threats:
- Growing demand for poultry - Intense competition
- Expansion into new markets - Fluctuating feed prices
- Increased consumer focus on organic and - Regulatory changes or restrictions
local products - Risk of avian diseases
- Potential for value-added products

Table 5: SWOT Analysis

Strengths:
- High-quality egg production: Our chickens are capable of producing fresh and
nutritious eggs, which can attract customers looking for superior quality.
- Ability to offer live birds: Selling live chickens provides additional revenue streams
and caters to customers who prefer to raise their own poultry.
- Potential for diversification: Our business can explore value-added products such as
processed chicken meat or egg-based products, expanding its product range and
potential market reach.

Weaknesses:
- Limited market reach: Establishing distribution channels and reaching a wide
customer base may require strategic marketing efforts and partnerships.
- Potential disease outbreaks: Ensuring proper biosecurity measures and monitoring
the health of our flock is crucial to minimize the risk of diseases and financial losses.
- Dependence on external factors: Weather conditions and fluctuating feed prices can
impact production and profitability, requiring careful management.

Opportunities:
18
- Growing demand for poultry: As the demand for poultry products continues to rise,
there is an opportunity to capture a larger market share.
- Expansion into new markets: Exploring new geographical areas or targeting specific
customer segments can help expand the customer base and increase sales.
- Increased consumer focus on organic and local products: Capitalizing on the trend of
consumers seeking organic and locally sourced products can attract a niche market
and differentiate your offerings.
- Potential for value-added products: Developing value-added products, such as ready-
to-cook chicken cuts or specialty eggs, can cater to customer preferences and increase
revenue streams.

Threats:
- Intense competition: The poultry industry is competitive, and it's important to
differentiate
our products and marketing strategies to stand out.
- Fluctuating feed prices: Monitoring and managing feed costs is essential to maintain
profitability during periods of price fluctuations.
- Regulatory changes or restrictions: Staying updated with regulations related to
poultry farming practices and complying with animal welfare standards is crucial to
avoid potential setbacks.
- Risk of avian diseases: Implementing strict biosecurity measures and having
contingency plans in place can mitigate the risk of disease outbreaks and protect your
flock.

By considering these factors and developing strategies to capitalize on strengths,

address weaknesses, seize opportunities, and mitigate threats, Our chicken farming
business can thrive in a competitive market while meeting customer demands.

19
 TECHNICAL STUDY

a. Flow of Operation
Flow of operations for egg production:

In the process of egg production, poultry is acquired and provided with

suitable housing and nesting areas. They are given proper feed and water, and
their health and wellness are closely monitored by the veterinary. These eggs
are collected, and graded based on quality and size. They are then packaged
and stored under controlled conditions. They are then sold to costumers.

store eggs
acquire poultry package eggs
properly

provide suitable monitor health market and sell

housing and wellness eggs

set up nesting
collect eggs
areas

provide feed grade and sort

and water eggs

Figure 4: Flow of operations for egg production

b. Gantt chart /schedule of activities

20
 The Gantt chart provides a visual representation of the project timeline,
allowing project managers and team members to track the progress of each
task, identify dependencies, allocate resources, and ensure that the project
stays on schedule.

Table 6: Gantt Chart

Jan Feb Ma Apr May June July Aug Sep Oct No De Jan
r v c

Planning and
Setup

Business
Registration

Securing of
Funds

Infrastructur
e
Development

Procurement

Egg
production
(for layers)

Egg
Collection

Distribution

Record
keeping

21
 c. Summary of equipment and facility requirement

Buildings
Unit
Particular Quantity Total price
Price
Poultry House Construction with
electrical wiring 1 ₱800,000 ₱800,000
Plumbing pipes 2(100m) 1,860 3,720

Steel cages 200 900 180,000

Hose Roll (25 mm diameter) 2 750 1,500
Chicken Drinker with automatic
cup setup 500 50 25,000
Linear Feeder 500 50 25,000
Total ₱1,035,220
Table 7: Building

Biological Asset
Unit
Particular Qty Total Year 1 Year 2 Year 3
Price
Chicken
2,000 ₱270 ₱540,000 ₱540,000 540,000 556,470
Layer
Less:
Chicken
1,000 ₱270 270,000 286,470
layers to - 270,000
be sold
Total 1,000 ₱270 270,000 270,000
- 270,000
Less:
Chicken
Layers to 1,000 ₱270 270,000
- 286,470 303,944.67
be
Purchased
Total ₱540,000 540,000 556,470 573,944.67
Table 8: Biological Asset

22
Chicken Food and Vitamins supplies
Particula Qt Unit Monthl Pre-
Year 1 Year 2 Year 3
r y Price y 0peration
₱1,80
Feeds 20 ₱36,00 ₱144,000 ₱288,000 ₱453,600 ₱475,680
0
Corn
10 1,450 14,500 ₱58,000 ₱116,000 182,700 183,135
Grits
Vitamins 5 300 1,800 ₱7,200 ₱14,400 22,680 22,734
₱418,40 ₱658,98 ₱681,54
Total ₱209,200
0 0 9
Table 9: Chicken Food and Vitamins supplies

Office supplies

Pre- Year 1 Year 2 Year 3

Particula Unit operatio
Qty
r pric n
e
20 530.75 563.39
Q.R.
booklet 25 500
receipts 598.04
s
106.15 112.68
Ball pen 1 box 100 100
119.61
191.07 202.82
Marker 1 box 180 180
215.29
Record 106.15 112.15
2 50 100
book 119.05
880 934.1 991.0 1,051.9
Total
2 4 9
Table 10: Office Supplies

Cleaning Supplies

Unit Pre- Year 1 Year 2 Year 3

Particular Qty
Price operation
Dust pan 4 120 509.52 540.86 574.12
480
Stick
4 40 160 169.84 180.29 191.38
broom
50
Trash bag 30 1,500 1,592.25 1,690.17 1794.1
rolls
2,271.6
Total 2,140 2,411.32 2559.6
1
23
 Table 11: Cleaning Supplies

Packaging supplies

Unit Pre- Year 1 Year 2 Year 3

Particula
Qty pric operatio
r
e n
Egg 50 15,285.6 16,225.6
17,223.5
paper pac 24 14,400 6
4
tray k
Plastic 50 3,449.875 3,662.04
twine roll 65 3,250 3,887.26
Straw s
Table 12: 18,735.47 19,887. 21,110.7
Packaging Total 17,650
Supplies 5 7 9

Utilities

No. Watts Daily

Yearly
Particulars of per Usage in Watts Kwh
Expenses
Items Item Hour
Ventilation 200.0 1,451.0 1.2 8,343.6
4 24.00
Fan 0 0 0 4
270.0 2,700.0 2.7 18,698.2
LED Tube 8 10.00
0 0 0 0
LED Light
165.0 1,320.0 5.6 38,786.0
Egg Candler 2 8.00
0 0 1 3
Tester
Thermostati
200.0 2,400.0 3.0 20,769.1
c Chicken 3 12.00
0 0 0 1
Coop Heater
Total 86,596.98
** Rate per hour is 19.18 and fixed charge is 5.00

Table: 13: Utilities

24
Tax and Licenses

Particular Price Year1 Year 2 Year 3

BIR Permit (1-year Validity) ₱500.00 500.00 ₱500.00 ₱500.00
DTI Registration (5 years
500 500.00
Validity)
Mayor’s Permit (1-year
1,550.00 1,550.00 1,550.00 1,550.00
Validity)
Business Permit (1-year
500 500.00 500 500
Validity)
Barangay Clearance (1-year
50 50.00
Validity)
Tax Identification Number 100 100.00
Pag-IBIG/Home
Development Fund 200 200.00
Registration

PhilHealth Registration 1,200.00 1,200.00

Bureau of Animal
Industry (Certificate for
3,000 3,000
Registration/ License to
Operate Animal Facility)
7,600.0
Total ₱2,550.00 ₱2,550
0

Table 14: Legal Requirements

25
 Table 15: Summary of equipment and facility requirement

Particular Year 1 Year 2 Year 3

Building ₱1,035,220.00
Chicken supplies 540,000 556,470 573,944.67
Chicken foods and
418,400.00 658,980 681,549
Vitamins supplies
Office supplies 934.12 991.04 1,051.99
Packaging supplies 19,887.7 21,110.79
18,735.475

Cleaning supplies 2,271.61 2,411.32 2,559.6

Utilities 86,596.98 86,596.98 86,596.98
Legal requirements
7,600 2,550.00 2,550
TOTAL ₱2,893,686.98 ₱1,326,538.185 ₱1,367,930.71

26
 d. Floorplan

Poultry house

Figure 5: Poultry house floor plan

27
 MANAGEMENT STUDY

a. Business Formation

The business will start as a sole proprietor because of formation

wherein there would be lesser legal requirements during its initial
establishment. There is only one capital account and one drawing
account. The capital is limited by the amount of assets that a sole owner
could invest and it has an unlimited liability wherein sole owner is legally
liable for all the business debt. The owner being taxed for the amount of
income earned by the business.
The business will use line type form of organizational structure
which is the simplest and most successful form. In the application of this
structure, the manager is also the owner. There will be a bookkeeper who
will be responsible in recording all financial transactions related to the
poultry business and the poultry farm workers.

b. Organizational Chart

OWNER/MANAGER

BOOKKEEPER WORKERS (4)

Figure 6: Organizational Chart

28
 c. Job Description and Qualification

Job Description Job Specification

Owner/ Manager - Responsible for overall - Bachelor’s degree in

management and Business
strategic decision- Administration,
making for the Agriculture, or a
business. related field.
- Oversees the day-to- - Strong leadership
day operations of the skills with the ability
chicken farming and to motivate and
food processing inspire teams.
business, including - Financial management
production, sales, and skills, including
administration. budgeting, forecasting,
and financial analysis.
- Knowledge of poultry
farming and food
processing operations.
Bookkeeper - Records all financial - Bachelor’s degree in
transactions related to Accounting, Finance,
the poultry business, or a related field is
including sales, preferred.
purchases, expenses, - Ability to work
and payments. independently and
- Tracks and manages meet deadlines.
the amounts owed to
the business by
customers (accounts
receivable) and the
amounts owed by the
business to suppliers
and vendors (accounts
payable).
- Reconciles the poultry
business’s bank
statements with the
financial records to
ensure accuracy and
identify any
discrepancies.
Workers - Feed and water the - Strong work ethic and
poultry according to a genuine interest in
established schedule working with animals.
and monitoring. - Willingness to work
- Monitor the health flexible hours,
29
 and behavior of the including weekends
poultry, identifying and holidays.
and reporting any
signs if illness or
distress.
- Clean and maintain
the poultry housing,
including bedding,
ventilation, and
temperature control.
- Collect eggs from the
nests, ensuring proper
handling and storage.
- Sort and pack eggs for
sale, adhering to
quality standards and
packaging
requirements.

Table 16: Job description and Qualification

d. Salaries and Benefits

As the year draws to a close, employees and employers closely monitor

the statutory contribution landscape the includes government agencies,
such as the Social Security System (SSS), Philippine Health Insurance Corp.
(PhilHealth) and Home Development Mutual Fund (HDMF), especially when
it comes to changes in contribution rates and premiums
As we approach 2024, individuals and businesses are bracing themselves
for new developments in statutory contributions. The most recent update
indicates that the SSS will witness stability in 2024, with no expected
change to the 14 percent total contribution rate. Employers will continue to
contribute 9.5%, while employees will retain 4.5% share. However, there is
an impending increase in 2025, aligning with the provisions of the Social
Security Act of 2018.
In contrast, PhilHealth is gearing up for adjustments in the absence of a
directive from the President. Come January 2024, the premium rate is set to
rise from 4% to 5%. These align with the Universal Health Care Law enacted
by President Duterte in 2019.
Turning attention to Pag-IBIG, a significant shift is on the horizon starting
January 2024. The Monthly Fund Salary (MFS) will increase accompanied
by a contribution rate hike from 1% to 2%. This implies that a Pag-IBIG
Fund member’s contribution will double in 2024, leaping from P100 to
P200.

30
 e. Payroll

Monthly Net Monthly

Employee Salaries Deductions Salaries

HDM PhilHealt Total

SSS F h Deduction

₱
Owner/ 665.0 ₱
Manager ₱ 7,000 0 ₱ 200 ₱ 350 1,215.00 ₱ 5,785.00
₱
Bookkeepe 225.0
r ₱ 5,000 0 ₱ 200 ₱ 250 ₱ 675.00 ₱ 4,325.00
₱
112.5
Worker 1 ₱ 2,500 0 ₱ 200 ₱ 125 ₱ 437.50 ₱ 2,062.50
₱
112.5
Worker 2 ₱ 2,500 0 ₱ 200 ₱ 125 ₱ 437.50 ₱ 2,062.50
₱
112.5
Worker 3 ₱ 2,500 0 ₱ 200 ₱ 125 ₱ 437.50 ₱ 2,062.50
₱
112.5
Worker 4 ₱ 2,500 0 ₱ 200 ₱ 125 ₱ 437.50 ₱ 2,062.50

₱3,640.0 ₱
TOTAL ₱ 22,000 0 18,360.00

Table 17: Payroll

ANNUAL SALARIES

# of
Employee Personnel Monthly Salaries Annual Salaries
Owner/
Manager 1 ₱7,000.00 ₱ 84,000.00
Bookkeeper 1 ₱5,000.00 ₱ 60,000.00
Workers 4 ₱2,500.00 ₱120,000.00
TOTAL 6 ₱264,000.00
31
 Annual salaries are monthly salaries multiplied by 12 months.

Table 18: Annual Salaries

Employer Share

Employer Share in SSS and PhilHealth Premiums

Employer SSS Contribution

Monthly Yearly
Contribution Contribution
Contribution EC Total PhilHealth

Owner/ 1,105 30 1,135 187.50 1,322.5 15,870

Manager
Bookkeeper 363.30 10 373.3 125.00 498.3 5,979.6

Poultry Farm 236.20 10 246.2 100.00 346.2 4,154.4

Worker 1

Poultry Farm 236.20 10 246.2 100.00 346.2 4,154.4

Worker 2

Poultry Farm 236.20 10 246.2 100.00 346.2 4,154.4

Worker 3

Poultry Farm 236.20 10 246.2 100.00 346.2 4,154.4

Worker 4

Total 2,975. 912.5 3,205 38,467

5

Table 19: Employer Sha

32
 SOCIO-ECONOMIC STUDY

Business is one big area that contributes to the economy. It plays a vital role in the
economic development of a country such as an industry either manufacturing or
service oriented and employment opportunities.
Chicken production in many parts of the rural and urban areas in the country has
contributed significantly as source of protein, food security, employment, and income
in resource-constrained communities.

a. To the Government
Taxes are the lifeline of the government. Without taxes, the government
will not be able to do anything to its people-no employment, no services, etc.
since business entities are great contributors of taxes, they are of big help to
the government. The proposed business will pay its income tax and business
tax to the government. These taxes will now be used by the government for the
needs of its constituents.

b. To the Community
The presence of many business types can further enhance the standard-
of-living by providing a wider range of services and amenities in the local area.
Since unemployment is one of the problems in the Philippines and job
vacancies are scares in that place (Maligcong), the business will provide a major
income-generating activities for unemployed youths, rural women, small and
marginal farmers and persons involved in small industries like –cage
fabrication, layer raising, feed formulation, poultry pharmaceuticals and
processing of food poultry meat and eggs.

c. To the Employees
All employees will be properly compensated. Seminars and trainings will
be conducted to further enhance their skills for better services towards our
customers. They can also use these skills if they wish to have a job in a bigger
setting with a higher salary. This business will also give job opportunities to
those in need, thus, reducing the unemployment rate or our society.

33
 d. To the Customer
This business will supply the shortage of the eggs in the target market area.
With the fast-rising population in the municipality. It was observed that there is a
demand of poultry products specially eggs. Thus, the proponents plan to engage in
poultry business bearing in mind that it will help the community provides fresh,
affordable and at the same time accessible eggs and chicken meats.

34
 FINANCIAL STUDY

This aspect presents the financial information and assumptions that would
determine the financial viability of the project. Projected financial statements are
presented, analyzed and interpreted based on the assumption.
The content of this aspect is based on the information provided by the
marketing, technical, management, and socio-economic aspects of the study. They
reflect all information that displays the performance, profitability, and viability of the
proposed project.
The Total Projected Cost which is 2,827,022.83 is the amount that will be
needed in order to operate the proposed business.
The projected Statement of Financial Position is composed of the Total Assets
(the business owns), Total Liabilities (the business owes), and the Owner’s Equity.
These are used to evaluate the proposed business’ liquidity, solvency, flexibility, and
marketability.
The Projected Statement of Comprehensive Income shows the financial
performance of the Chicken Farming industry which has an income of 3,000,878.12
(yr. 2024), 3,024,002.54 (yr. 2025), 3,027,476.79 (yr. 2026), and has a loss of
21,932.83 in the pre-operation of the business.
The Projected Statement of Cash Flow provides information about the projected
cash receipts and cash disbursements of the business during the period. It also
provides information that enables the users to evaluate the changes in net assets
solvency. Information in the cash flow is useful in assessing the ability of the company
to generate cash for the business.
The payback period of the proposed business is 0.43 years or 5 months.

35
 Chicken Farming and Food Processing
Project Cost
(All amounts in Philippine Peso)
Cost
Current Assets
Office Supplies 880.00
Cleaning Supplies 2,140.00
Packaging Supplies 17,650.00
Chicken Food and Vitamin
Supplies 209,200.00
Total Current Assets 229,870.00
Noncurrent Assets
Biological Asset 540,000.00
Building 1,035,220.00
Land 1,000,000.00
Total Noncurrent Assets 2,575,220.00
Pre-operating Costs
Utilities Expense 14,432.83
Taxes and Licenses 7,500.00
Total Pre-operating Costs 21,932.83
Total Project Cost 2,827,022.83
Salingbay, Capital 2,827,022.83
Total 2,827,022.83

Table 20: Projected Cost

36
 Chicken Farming and Food Processing
Projected Statement of Financial Position
As of the Years Ended December 31, 2024, 2025, 2026
All amounts in Philippine Peso

Notes Pre-operation 2024 2025 2026

Current Asset
Cash 1 - 3,431,224.76 6,540,761.54 9,652,824.06
Office Supplies 3 880.00 978.12 1,039.95 1,103.49
Cleaning Supplies 4 2,140.00 2,271.61 2,411.32 2,559.60
Packaging Supplies 5 17,650.00 19,617.98 20,868.60 22,154.22
Chicken Food & Vitamin Supplies 6 209,200.00 31,380.00 34,518.00 35,803.35
Total Current Assets 229,870.00 3,485,472.47 6,599,599.40 9,714,444.73
Non-Current Asset
Biological Asset 7 540,000.00 540,000.00 556,470.00 573,809.67
Building 12 1,035,220.00 931,698.00 828,176.00 724,654.00
Land 1,000,000.00 1,000,000.00 1,000,000.00 1,000,000.00
Total Non-Current Assets 2,575,220.00 2,471,698.00 2,384,646.00 2,298,463.67
TOTAL ASSETS 2,805,090.00 5,957,170.47 8,984,245.40 12,012,908.40
Current Liabilities
SSS, PhilHealth & HDMF Payable 13 - 9,616.75 9,616.75 9,616.75
VAT Tax Payable 14 - 141,585.60 144,657.99 145,844.19
Total Liabilities - 151,202.35 154,274.74 155,460.94
Salingbay, Capital 2,805,090.00 5,805,968.12 8,829,970.66 11,857,447.46
Total Equity 2,805,090.00 5,805,968.12 8,829,970.66 11,857,447.46
TOTAL LIABILITIES AND EQUITY 2,805,090.00 5,957,170.47 8,984,245.40 12,012,908.40

Table 21: Statement of Financial Position

37
 Chicken Farming and Food Processing
Projected Statement of Comprehensive Income
For the Years Ended December 31, 2024, 2025, 2026
All amounts in Philippine Peso

Notes Pre-operation 2024 2025 2026

Sales 15 - 4,719,520.00 4,821,933.00 4,861,473.00

Add: Miscellaneous Income - 12,000.00 12,000.00 12,000.00
Total Income - 4,731,520.00 4,833,933.00 4,873,473.00
Less: Expenses
Office Supplies Expense 17 - 836.00 929.21 987.95
Cleaning Supplies Expense 18 - 2,140.00 2,271.61 2,411.32
Packaging Supplies Expense 19 - 16,767.50 18,637.08 19,825.17
Chicken Food and Vitamin Supplies 20 - 596,220.00 655,842.00 680,263.65
Utilities Expense 21 14,432.83 86,596.98 91,879.40 97,392.16
Depreciation Expense- Building 26 - 103,522.00 103,522.00 103,522.00
SSS, Philhealth, HDMF Expense 27 - 38,467.00 38,467.20 38,467.20
Salaries Expense 28 - 264,000.00 264,000.00 264,000.00
Taxes And Licenses 29 7,500.00 2,550.00 2,550.00 2,550.00
Mortality 30 - 43,200.00 43,200.00 43,200.00
Professional Fees 31 - 10,000.00 10,000.00 10,000.00
Total Expenses 21,932.83 1,164,299.48 1,231,298.50 1,262,619.45
Net Income/ (Loss) before Tax - 21,932.83 3,567,220.52 3,602,634.50 3,610,853.55
Less: VAT Expense - 566,342.40 578,631.96 583,376.76
Net Income/ (Loss) after Tax - 21,932.83 3,000,878.12 3,024,002.54 3,027,476.79

Table 22: Statement of Comprehensive Income

38
 Chicken Farming and Food Processing
Projected Statement of Cash Flow
For the Years Ended December 31, 2024, 2025, 2026
All amounts in Philippine Peso

Pre-operation 2024 2025 2026

Cashflow From Operating Activities
Net Income/ Loss - 21,932.83 3,000,878.12 3,024,002.54 3,027,476.79
Depreciation Expense- Building - 103,522.00 103,522.00 103,522.00
Increase/(Decrease) of Office Supplies - 880.00 - 98.12 - 61.83 - 63.54
Increase/(Decrease) of Cleaning Supplies - 2,140.00 - 131.61 - 139.71 - 148.28
Increase/ (Decrease) in Packaging Supplies - 17,650.00 - 1,967.98 - 1,250.62 - 1,285.62
Increase/ (Decrease) in Chicken Food and Vitamin Supplies - 209,200.00 177,820.00 - 3,138.00 - 1,285.35
Increase/(Decrease) SSS, Philhealth and HDMF Payable - 9,616.75 - -
Increase/(Decrease) VAT Payable - 141,585.60 3,072.39 1,186.20
Net Cash Provided/(Used) by Operating Activities - 251,802.83 3,431,224.76 3,126,006.77 3,129,402.20
Cashflow From Investing Activities
Increase/ (Decrease) in Biological Asset 540,000.00 - - 16,470.00 - 17,339.67
Increase/ (Decrease) in Building 1,035,220.00 - - -
Net Cash Provided/(Used) by Investing Activities - 1,575,220.00 - - 16,470.00 - 17,339.67
Cashflow From Financing Activities
Cash Investment 1,827,022.83 - - -
Net Cash Provided/(Used) by Financing Activities 1,827,022.83 - - -
Net Increase/(Decrease) In Cash - 3,431,224.76 3,109,536.77 3,112,062.53
Cash Beginning - - 3,431,224.76 6,540,761.54
Cash Balance, End. - 3,431,224.76 6,540,761.54 9,652,824.06

Table 23: Statement of Cash Flow

39
 Chicken Farming and Food Processing
Projected Statement of Owner's Equity
For the Years Ended December 31, 2024, 2025, 2026
All amounts in Philippine Peso

Pre-operation 2024 2025 2026

Salingbay, beg. 2,827,022.83 2,805,090.00 5,805,968.12 8,829,970.66

Add: Profit/ Loss - 21,932.83 3,000,878.12 3,024,002.54 3,027,476.79
Total 2,805,090.00 5,805,968.12 8,829,970.66 11,857,447.46
Less: Salingbay, Drawings - - - -
Capital, end. 2,805,090.00 5,805,968.12 8,829,970.66 11,857,447.46

Table 24: Statement of Owner’s Equity

40
Note 1: Cash
Pre-operation 2024 2025 2026
Cash in Bank - 3,281,180.86 6,389,561.41 9,501,450.23
Cash on Hand - 150,043.91 151,200.13 151,373.84
Total Cash - 3,431,224.76 6,540,761.54 9,652,824.06

Note 3: Office Supplies

Pre-operation 2024 2025 2026
Office Supplies, beg. - 880.00 ₱ 978.12 ₱ 1,039.95
Add: Purchases 880.00 934.12 991.04 1,051.49
Office Supplies Available for Use 880.00 1,814.12 1,969.16 2,091.44
Office Supplies Expense - 836.00 929.21 987.95
Office Supplies, end. 880.00 978.12 1,039.95 1,103.49

Note 4: Cleaning Supplies

Pre-operation 2024 2025 2026
Cleaning supplies,beg. - 2,140.00 ₱ 2,271.61 ₱ 2,411.32
Add: Purchases 2,140.00 2,271.61 2,411.32 2,559.60
Cleaning supplies available for use 2,140.00 4,411.61 4,682.93 4,970.92
Less: Cleaning Supplies Expense - 2,140.00 2,271.61 2,411.32
Cleaning Supplies End 2,140.00 2,271.61 2,411.32 2,559.60

Note 5: Packaging Supplies

Pre-operation 2024 2025 2026
Packaging Supplies, beg. - 17,650.00 ₱ 19,617.98 ₱ 20,868.60
Add: Purchases 17,650.00 18,735.48 19,887.70 21,110.79
Packaging Supplies Available for Use 17,650.00 36,385.48 39,505.68 41,979.39
Less: Packaging Supplies Expense - 16,767.50 18,637.08 19,825.17
Packaging Supplies End 17,650.00 19,617.98 20,868.60 22,154.22

Note 6: Chicken Food and Vitamin Supplies

Pre-operation 2024 2025 2026
Chicken Food and Vitamin Supplies, beg. - 209,200.00 31,380.00 34,518.00
Add: Purchases 209,200.00 418,400.00 658,980.00 681,549.00
Chicken Food and Vitamin Available for Use 209,200.00 627,600.00 690,360.00 716,067.00
Less: Chicken food and vitamin Supplies Expense - 596,220.00 655,842.00 680,263.65
Chicken food and vitamin Supplies End 209,200.00 31,380.00 34,518.00 35,803.35

Note 8: Biological Asset

Pre-operation 2024 2025 2026
Beg, Balance - 540,000.00 540,000.00 556,470.00
Add: Purchases 540,000.00 270,000.00 286,470.00 303,944.67
Total 540,000.00 810,000.00 826,470.00 860,414.67
Less: Mortality - 43,200.00 43,200.00 45,856.80
Sold as live Chicken - 226,800.00 226,800.00 240,748.20
Biological Asset 540,000.00 540,000.00 556,470.00 573,809.67

Note 12: Building

Pre-operation 2024 2025 2026
Building 1,035,220.00 1,035,220.00 1,035,220.00 1,035,220.00
Depreciation Expense-Equipment - 103,522.00 207,044.00 310,566.00
Building 1,035,220.00 931,698.00 828,176.00 724,654.00

Note 13: SSS, PhilHealth and HDMF Payable

Pre-operation 2024 2025 2026
SSS, PhilHealth And HDMF Expense - 38,467.00 38,467.00 38,467.00
Divide by: Quarters of a Year - 4 4 4
SSS, PhilHealth And HDMF Payable - 9,616.75 9,616.75 9,616.75

Note 14: VAT Tax Payable

Pre-operation 2024 2025 2026
VAT Tax Payable ₱ - ₱ 566,342.40 ₱ 578,631.96 ₱ 583,376.76
Divide by: Quarters of a Year -41 4 4 4
VAT Tax Payable ₱ - ₱ 141,585.60 ₱ 144,657.99 ₱ 145,844.19
Note 15: Sales
Pre-operation 2024 2025 2026
Sales from Eggs - 4,719,520.00 4,821,933.00 4,861,473.00
Sales from live chicken 1,185,600.00 1,211,250.00 1,221,000.00
Sales - 4,719,520.00 4,821,933.00 4,861,473.00

Note 17: Office Supplies Expense

Pre-operation 2024 2025 2026
Office Supplies, beg. - 880.00 ₱ 978.12 ₱ 1,039.95
Add: Purchases 880.00 934.12 991.04 1,051.49
Office Supplies Available for Use 880.00 1,814.12 1,969.16 2,091.44
Less: Office Supplies, End 880.00 978.12 1,039.95 1,103.49
Office Supplies Expense - 836.00 929.21 987.95

Note 18: Cleaning Supplies Expense

Pre-operation 2024 2025 2026
Cleaning supplies,beg. - 2,140.00 ₱ 2,271.61 ₱ 2,411.32
Add: Purchases 2,140.00 2,271.61 2,411.32 2,559.60
Cleaning supplies available for use 2,140.00 4,411.61 4,682.93 4,970.92
Less: Cleaning Supplies End 2,140.00 2,271.61 2,411.32 2,559.60
Cleaning Supplies Expense - 2,140.00 2,271.61 2,411.32

Note 19: Packaging Supplies Expense

Pre-operation 2024 2025 2026
Packaging Supplies, beg. - 17,650.00 ₱ 19,617.98 ₱ 20,868.60
Add: Purchases 17,650.00 18,735.48 19,887.70 21,110.79
Packaging Supplies Available for Use 17,650.00 36,385.48 39,505.68 41,979.39
Less: packaging Supplies End 17,650.00 19,617.98 20,868.60 22,154.22
Packaging Supplies Expense - 16,767.50 18,637.08 19,825.17

Note 20: Chicken Food and Vitamin Supplies Expense

Pre-operation 2024 2025 2026
Chicken Food and Vitamin Supplies, beg. - 209,200.00 ₱ 31,380.00 ₱ 34,518.00
Add: Purchases 209,200.00 418,400.00 658,980.00 681,549.00
Chicken Food and Vitamin Available for Use 209,200.00 627,600.00 690,360.00 716,067.00
Less: Chicken food and vitamin Supplies End 209,200.00 31,380.00 34,518.00 35,803.35
Chicken food and vitamin Supplies Expense - 596,220.00 655,842.00 680,263.65

Note 21: Utilities Expense

Pre-operation 2024 2025 2026
Ventilation Fan 1,390.61 8,343.64 8,852.61 9,383.76
LED Tube 3,116.37 18,698.20 19,838.79 21,029.11
LED Light Egg Candler Tester 6,464.34 38,786.03 41,151.98 43,621.10
Thermostatic Chicken Coop Heater 3,461.52 20,769.11 22,036.03 23,358.19
Utilities Expense 14,432.83 86,596.98 91,879.40 97,392.16

Note 26. Depreciation-Building

Pre-operation 2024 2025 2026
Building - 1,035,220.00 1,035,220.00 1,035,220.00
Divided by: Useful Life - 10 10 10
Total - 103,522.00 103,522.00 103,522.00

Note 27. SSS, Philhealth, HDMF Expense

Pre-operation 2024 2025 2026
Owner/Manager 15,870.00 15,870.00 15,870.00
Bookkeeper 5,979.60 5,979.60 5,979.60
Poultry Farm Worker 1 4,154.40 4,154.40 4,154.40
Poultry Farm Worker 2 4,154.40 4,154.40 4,154.40
Poultry Farm Worker 3 4,154.40 4,154.40 4,154.40
Poultry Farm Worker 4 4,154.40 4,154.40 4,154.40
Total 38,467.00 38,467.20 38,467.20

42
Note 28. Salaries Expense
Pre-operation 2024 2025 2026
Owner/Manager 84,000.00 84,000.00 84,000.00
Bookkeeper 60,000.00 60,000.00 60,000.00
Poultry Farm Worker 1 30,000.00 30,000.00 30,000.00
Poultry Farm Worker 2 30,000.00 30,000.00 30,000.00
Poultry Farm Worker 3 30,000.00 30,000.00 30,000.00
Poultry Farm Worker 4 30,000.00 30,000.00 30,000.00
Total 264,000.00 264,000.00 264,000.00

Note 29: Taxes and Licenses

Pre-operation 2024 2025 2026
BIR Permit (1-year Validity) 500.00 ₱500.00 ₱500.00 ₱500.00
DTI Registration (5 years Validity) 500.00
Mayor’s Permit (1-year Validity) 1,550.00 1,550.00 1,550.00 1,550.00
Business Permit (1-year Validity) 500.00 500 500 500
Barangay Clearance (1-year Validity) 50.00
Tax Identification Number 100.00

Pag-IBIG/Home Development Fund Registration 200.00

PhilHealth Registration 1,200.00

Bureau of Animal Industry 3,000.00
Total 7,500.00 2,550.00 2,550.00 2,550.00

Note 30: Professional Fee

Pre-operation 2024 2025 2026
Annual Financial Statements Audit - 10,000.00 10,000.00 10,000.00
Total - 10,000.00 10,000.00 10,000.00

Note 31: VAT Expense

Pre-operation 2024 2025 2026
Sales - 4,719,520.00 4,821,933.00 4,861,473.00
Multiply by: 12% 12% 12%
Total - 566,342.40 578,631.96 583,376.76

Table 25: Notes to Financial Statements

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Financial Statement Analysis

A. Current Ratio
Pre-operation 2024 2025 2026
Current Asset
229,870.00 3,485,472.47 6,599,599.40 9,714,444.73
Current Liabilities
- 151,202.35 154,274.74 155,460.94
Total Current
0.00
Ratio 23.05 42.78 62.49
Table 26: Current Ratio

** For every liability of the business, there is an available 23.05, 42.78, current
62.49 assets to cover it up, for the year 2024-2026.

B. Equity Ratio
Pre-operation 2024 2025 2026
Total Equity
2,805,090.00 5,805,968.12 8,829,970.66 11,857,447.46
Total Asset
2,805,090.00 5,957,170.47 8,984,245.40 12,012,908.40
Total Equity 1.00 0.97 0.98 0.99
Table 27: Equity Ratio

** Equity ratio proportion of all assets that are financed by the owner. It reflects
financial strength and caution to creditors. For every P1.00 asset of the business,
97%, 98%, 99% is provided by the owner on equity for the year 2024-2026.

C. Rate of Return
on Equity
Pre-operation 2024 2025 2026
Net Income -21932.83
3,000,878.12 3,024,002.54 3,027,476.79
Total Equity
2,805,090.00 5,805,968.12 8,829,970.66 11,857,447.46
Total -0.01 0.52 0.34 0.26
Table 28: Rate of Return on Equity

** This means that for every peso resource provided by the owner, 0.52, 0.34,0.26
will be added to her wealth for the year 2024-2026.

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 D. Payback Period

Net Investment 2,827,022.83

Average Cash
Return 6,541,603.46
0.43
Table 29: Payback Period

** This measures the time requirement for the amount invested on asset to be
retrieved for the proposal business. It will take 0.43 years or 5 month2 to recover the
initial investment.

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