A Feasibility Studies of Cyberkadahan Internet Cafe

AMA COMPUTER LEARNING CENTER CALOOCAN

CYBERKADAHAN INTERNET CAFÉ

A Feasibility Study Presented to AMA COMPUTER LEARNING CENTER CALOOCAN

IN PARTIAL FULLFILLMENT FOR THE COURSE COMPUTER BASED ACCOUNTING/OFFICE INFORMATION SYSTEM

Maria Normita Cava Evelyn C. Macabodbod Jacquelyn B. Santos Katherine Trinidad Angelica Aquino

March 2009

If you want the financial analysis and etc. You can e-mail at [email protected]

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Acknowledgement

Gratefully acknowledgement to the following persons who in one or another helping us in making this study a successful one. They serve as guide and shared knowledge that this project was made possible. To Mr. Arnold Policarpio our special project adviser who has been there to support us. To Mr. Arbie Laquian for teaching how to prepare the financial statement and spending his time even though he’s busy. To Mr. Christian Ortega owner of RAMPAGE CAFÉ and Ms. Lorna Torres employee of Caloocan City Hall for giving us the time and allowing us to conduct a survey in their prospective area. To our dear family who have been always there supporting and being understanding in giving the time for us to spend this project. And above all to our Almighty God a million thanks for the strength, knowledge, good health, wisdom and the guidance that enlightened our hearts and minds that this study would be possible.

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HISTORY Internet café business is indeed a very popular business. It is one of the establishments made indispensable in an increasingly interconnected world. Internet café was started with the opening of the first cyber café, Café Cyberia, in London (UK) September 1, 1994. It was founded by Eva Pascoe. It started with half a dozen HP computers, connected to the Internet through dial-up modems that were able to transfer data at 9.6 kilobytes per second. As the first Internet cafe, Cafe Cyberia got tremendous publicity and additional investments into the business from likes of Mick Jagger and Maurice Saatchi. With the success of Cafe Cyberia, the Internet Cafe business got into a flying start, and there were over 60 similar cafes over the world by the summer of 1995. “CYBERKADAHAN INTERNET CAFE” is name of a proposed business plan; “CYBER” being related to computers and “KADAHAN” meaning a group of individual or people who are closely bonded. Type of Business Organization Since the composed of five (5) ladies each one of has agreed and decided to be partners. The groups preferred to use partnership as a type of business organization. Partnership – is an organization where two or more person binds themselves to contribute money, property, or industry into a common fund with the intention of dividing profits among themselves. Benefits of partnership type of business we are establishing: o Partnership is relatively easy to establish; however times should be invested in developing the partnership agreement, in our case there’s no problem about it because we are mostly friends and we are devoted to make our business progress. o With more than one owner, the ability to raise funds- Debt vs. Equity maybe increased. o Enhanced capital availability. Two or more people will be providing and searching for capital. In addition, funding sources are more likely to entertain financing request because of the broader capital base.

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o The profit from the business flow directly to the business though the partners personal tax return. o Higher quality employees. Partnerships tend to attract better employees because of the possibility of becoming a principal in the firm. o Easy form. Procedures and expenses are minimized. o The business usually benefit from partners who have complementary skills. o Better decision- making capability. Two heads are better than one. o Managerial flexibility. Generally, important decisions can be quickly, although not as fast in a sole proprietorship. o Limited government interference. Like sole proprietorship are normally free of extensive governmental scrutiny. Cyberkadahan Internet Café provides services that would give satisfaction to our customer. Aside from computer rental that have reasonable hourly rates for internet gaming, internet surfing or searching cd-burning, scanning, and colored printing Proposed Location will be located at # 82 Samson Road Caloocan City, our prospective customers are basically everybody—students doing their projects or research and gamers. This business starts with the capital of P 700,000.00 Seven Hundred Thousand Pesos contributed by each partner as follows: NAME

AMOUNT CONTRIBUTED

TYPE OF PARTNERS

Evelyn Macabodbod

Php 233,333.33

Capitalist Industrial

Jacquelyn Santos

Php 233,333.33


Maria Normita Cava

Php 233,333.33


Angelica Aquino

Industrial

Katherine Trinidad

Industrial

Capitalist Partner – one who contributes capital in money or property Capitalist Industrial Partner – one who contributes in money, property, and industry. Industrial Partner – one who contributes industry, labor, skill or service. The objective of this proposed project is to acquire the prospective customers and to achieve the desired profit with in the specific period of time, and 4

o To earn profit. o To develop one’s skill to build up good relationship among customer. o To help the students especially the neighboring Barangays to find a computer’s rental at affordable price. o To give leisure and enjoyment. o To be successful business partners.

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SITE PREPARATION The business will be renting a space along hi-way near to malls, and schools, were our target customers are mainly students and nearby neighborhood especially those people whose relatives or loved ones are at abroad and find it very convenient communicating with them through chat and email. The two hundred (200) meter radius requirements as provided in the existing Zoning Code and other applicable rules and regulations wherein computer shops and other similar establishments and places of amusements should be put up or constructed at least two hundred (200) meters away from the church, schools, hospitals, and other government offices shall be strictly complied with. Site survey is primarily our main concern in this preparation. On our site survey we find out that the site has less than 5 competitors and it’s a good sign of putting up the business. We choose the location, at #82 Samson Road at Caloocan City, beside Asian Trust Bank. It’s about 40 square meters. It is the ideal place to establish an internet café because it is accessible to public because it’s along the highway and our target market is mostly students, near to schools like Divine Mercy College, Sacred Heart, St. Gabriel Academy and Gomburza Elementary School. We choose this site because we found out that competitors are minimal in the place. It’s an urbanized area were accessibility, competency and we study niche/market, as our main objective while choosing this site. In accessibility, the location is just along the highway, and it’s near to malls such as Ever Grand Central, Victory Mall, Araneta Square, and Puregold, and schools such as Divine Mercy College, Sacred Heart and Gomburza Elementary School and people just strolling along the way and or passengers of utility vehicle can easily see the Internet Café. In competency and study of niche/market, the proposed location is a commercial place, so the prospective customer’s is almost everybody. Most of the Internet shop located in the area is inside the malls while the competitors outside is just minimal, and for that we are more capable of attracting customer’s because we will offer more affordable rental fee in 15 pesos per hour. Our Internet café will provide small private booths for quiet chatting compare to the standard elbow to elbow computer station. We agreed that the shop should be well ventilated (air condition) to make our customer comfortable, good music is well provided, the PC’s is all well organized and arrange properly according to their rows for the convenience of our customer. Each computer has their own games, internet and surfing to be chosen by our customer, what they want and need is mainly our concerns. 6

TECHNICAL ASPECT In technical aspect it identifies whether the services rendered could be the highest possible quality level with minimum cost. In this aspect we will discuss the equipment and other computer application we use in the business. We purchase equipment as packages in order to lessen our expense. Hardware and Software is our much focus aspects. We did researching on how much the Hardware and software will cost us, through net surfing. The internet connection we used is Package plan of DSL Bayantel amounting P9,799.00 with capacity for 20 computers and have a speed of 2 Mbps. In Hardware our target number of PC is 15 (monitor-flatscreen, keyboard, PS2 mouse and processor, webcam),The Internet connection is a package of

Bayantel DSL

connected

(cables) with the speed of 2mbps amounting 9,799.00, 3 in 1Printer, Scanner & Photocopier. In Software, we will installing original Operating System of Ms Office Professional 2007 likes MS Word, Excel, Power point, Access, Desktop Publishing and installing the popular on line games such World of warcraft , CounterStrike, Battle Realms, Dance Audition, Auto Jam, and we will be installing Norton 360 version 3.0 premium for our anti-virus and anti-spyware. We offer other service to customers likes printing in black and white, DVD/CD burning, photocopying, scanners, and payphone. List of Hardware

Brand name

Amount

Package PC’s

Pentium 4

Php. 19,500.00

3 in 1 PSC

HP Officejet 2610 Print/Scan/Copy

Php. 14,500.00

Computer application software OS MS Office 2007

Amount Php. 19,200.00

Game software: Warcraft (dota)

Php. 1,450.00

Counterstrikes

Php.

350.00

Battle Realms

Php.

720.00

Dance Audition

Php. 1,968.00

Autojam

Php. 1,968.00

Anti-virus and anti spy ware

Php. 10,800.00 7

MARKETING ASPECT In marketing aspect, promoting business will use different strategies and techniques to attract probable customers. And offer promo’s to attract customer like  Computer to rent for cheap  40 for every 3 hours  Membership- (the customers will be given a card to be stamped every visit and if they got 25 stamped there every 2 hours is 20% discounted)  Contest for gamers (the winner will be free on their rental charge & to be held every Saturday from 3:00 to 5:00 pm only.) We create some marketing strategies like; we will print a thousands little half or quarter page fliers printed with the total cost of Php 908.00 (500 pcs. on the small fliers that cost of Php. 220.50 while the second fliers is also 500 pcs. with the cost of Php. 687.50), a month before our opening and we will distribute the fliers, mailboxes or gate. If we get a lot of text and e-mail we know we already have a market. We will put tarpaulin on the place itself where our shop is standing, promoting the opening of our Internet café also one month before the opening. To let people know that there will be new Internet Shop on the vicinity. Tarpaulin size is 35” x 70”, the streamers amount is Php 340.27, And another tarpaulin for the services with the size of 29” x 39” amounting of P157.08 FLIERS

“The latest and Greatest Internet Café” You can text or E-mail through this number 09078888888 448-88-88 [email protected] For a free 1 hour introductory price!

o o

o o

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TARPAULINS

SERVICES OFFERED “CYBERKADAHAN” INTERNET Internet/Games CD Burning Printing Photocopying Scanning Payphone

CAFÉ

#82 Samson Road Caloocan City

*P40/3 hours *Contest for gamers *Membership

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Services It’s the factor that affect mostly ones business because through services customer will decide if they are satisfied or not. Price It is one of the considerations of the customer that enhance them to rent computers. If the price is lower they will rent. Our services are the following: Amount Internet/ Games

Php. 15.00 / hour

Printing black and white-

Php. 3.00 (short)

Colored (depends on the size of the color)

Php. 10.00 (minimum) ex. Logos

Photocopying

Php. 1.00 (short)

Scanning

Php. 10.00

CD burnings

Php. 35.00 (max. 17 songs)

Other services:

Payphones

Php. 4.00 (long) Php. 1.25 (long)

Php. 5.00 / every 3 min.

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MANPOWER Manpower requirements are very important to any business in order for them to have an intelligent and accurate people who will manipulate inside the firm. Requirements will serve as basis on personal and general background of an employee enable for the company to know the capacity of their skills and ability to do work to the assign for them. Business owner will be in charge in human resource. The personnel to man Internet cafe will be the industrial partner who works by shift, 8 hours a day, the first shift is from 7:00 am to 3:00 pm while the second shift is from 2:00 pm to 10:00 pm. A walk in technician will be called in case of computers malfunctions and he will visit the shop twice a month. Walking Technician P400.00/visit twice a month ESTIMATED ANNUAL COST FOR MANPOWER For Walking Technician ----- P9, 600.00/year (800*12) Additional budget allocation for computer troubleshooting Php. 500 (500*12) (Just incase our technician is not available.) MANAGER

Ms. Ma. Normita Cava Ms. Jacquelyn B. Santos

ACCOUNTANT

Ms. Evelyn Macabodbod

CASHIER/COMPUTER ASSISTANT

Ms. Angelica Aquino Ms. Katherine Trinidad

I.T.

Mr. Tomy Alejandro

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JOB FUNCTIONS POSITION MANAGER

FUNCTION - Establishes store policies and procedure for strict implementation - Execute final decisions on all matters pertaining to the operation and the management functions of the business - Audit individual computers to check for proper system - Visit the shop alternate everyday

ACCOUNTANT

- Check the book of accounts and financial statement in daily basis - Handles license renewals,facilities preparation and payment of annual tax generated by the business. - Visit the shop every other day.

COMPUTER ASSISTANT / CASHIER

- Accept payment - Maintains inventory of supplies in the shop - To assist customers in their needs - Maintain cleanliness and orderliness. - Help conserve Utilities consumption - Logging the customers hours consumed

I.T.

- Incharge in computer maintenance

* I.T. Expert

- Provide information and/ or technical aspect

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OPERATION OF A BUSINESS Factors that we consider while putting up our own Internet cafe o

Location- Picking a good spot and we’ll hit us a gold mine.

o

Competition- Most business-minded people think of competition as a race to charge the lowest prices in order to win customers. While it’s good for the customers, exceeding the lower boundaries can drive you and your competitors to bankruptcy. One cannot expect to recover a Php500, 000 investments if hourly rentals go down to as low as Php10. It goes without saying that in this industry, there are no customer loyalty; just cheaper rentals.

o

Software Licensing-it’s really important to have an original operating system, because pirated OS can eventually damage the system.

o

Expected ROI- investing money in a business is a risk in our case the well tabulated if financial statement is our major concern.

Café opens at 7:00 am until 10:00 pm. Ahead of other competitors, this will lead us of being known. Our goal is to give the needs of the students and others in an early manner of time. It will also include the completion all legal requirements before the operation of business. In operational procedure we keep in minds all the legal aspects of establishing a business such as Business permit & the following requirements are: LEGAL REQUIREMENTS o Registration with BIR (Bureau of Internal Revenue) o Registration of business name with DTI ( Department of Trade and Industry) o Barangay Clearance and Business Permit o Mayors Permit BARANGAY CLEARANCE The proposal business will secure Barangay permit that is our responsibilities. It would make the immediate community to be aware of the business that would give satisfaction and promote community involvement. REGISTRATION OF NAME WITH DTI

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The proposed business should be registered with DTI to assure that any organization of individual for their business proposal for future use would not copy the name of our business. It acquires 15 days period of processing before the name of the business registered certificate can be issued by the said government agency. BUSINESS/MAYOR’S PERMIT Business Permit must be applied with the licensing office at the Municipal Hall of the said locality. It would be based on the reported business entity to be put up; we secured barangay clearance as a requirement for an application. Bureau of Internal Revenue The proposed business should register with BIR and secured TIN (Tax Identification Number) which will be used as simplifying the record control producers relating to taxation and securing VAT (Value Added Tax) MAYOR’S PERMIT Mayor’s permit must acquired before the operation of the business Steps in processing permits STEP 1 1. Business Name Registration Certificate Validity: 5 years Requirements: o Accomplished Business Name Registration Form [Single Proprietorship/Partnership] o Tax Identification Number (TIN) o Registration fee of P 300.00 STEP 2 Mayor’s / Business Permit Local Municipality where the business is located Validity: 1 year Requirements: 14

o Accomplished Business Permit Application Form o DTI-Business Name Certificate o Sketch of he business location o Barangay Clearance o Lease Contract STEP 3 o Bureau of Internal Revenue (BIR) National Office STEP 4 Securities and Exchange Commission (SEC) Certificate Requirements: o Verification Slip Form (re: proposed name) o Accomplished Registration Data Sheet LEGAL REQUIREMENTS COST Barangay Clearance

------

150.00

Mayor’s Permit

------ 9,514.00

- Business Tax

1,400.00

- Mayor’s Permit

2,096.00

- Business Plate

350.00

- Refuse Fee

2,384.00

- Sanitary Permit

2,064.00

- Health Certificate

200.00

- Occupational Tax

200.00

- Inspection Fee

200.00

- Filing

100.00

- Processing

120.00

- Zoning

400.00

BIR

------

300.00

DTI

------

500.00

Total

------ P 10,464.00 15

* The mayor’s permit computation was computed by Ms. Lorna Torres at Business Permits and Licensing Office, City of Caloocan

Signage Permit 5ft

Length

2ft

Width

* According to Mr. Bong Reyes of Engineer’s Office of Caloocan City Hall signage permit is 35.00 per square ft. Computation: 10sq.ft. x 35.00

= 350.00

Additional Inspection fee 150.00 Filing fee Total Cost

50.00 Php550.00

The amount of signage is Php.4,000.00 The store will be open Monday through Sunday. Ahead from other Internet shop along the area, the mall opens at 8:30 am; we always believe that the early bird catches the worm. The place is good for group, good for kids, attire- casual. Assumptions: 

Business Year will start at June 2009



Prepaid Rent is Php.10,000.00 monthly, Payment will first month of the business year.



Payable must paid before the division of income



Division of income will be at the end of business year



Salaries for Other technician will be Php.500.00 per visit, estimated once a month



Air condition maintenance will for Php.450.00 every year



Water expense is Php.117.50 minimum bill every month.



Bill of telephone was included in DSL



Cleaning Expense is Php.1,735.00 for the whole year



Anti virus is package purchase that good for 5 computers amounting Php.3,600.00 each



2010 purchase another Norton Anti virus for the additional computer 16



Padlock and other cleaning materials considered as expense at the end of the year



Membership card is good for 1 year



All lightings materials are included in lease of contract



Membership card, small tarpaulins & fliers will purchased twice a year

LIST OF SUPPLIES The materials needed for the operation of the business Bond Paper

150.00 (500pcs./rim)

CD w/ Case

13.00/set

Ballpen

- 48.00/box of 12pcs.

Stapler

- 100.00

Stapler Wire

- 30.00

HP 96 Black Ink

- 800.00

HP 97 Tri-Color

- 850.00

Record Book

-

25.00

Fire Extinguisher 10lbs. (Danwell)- 3,950.00 Other Equipment Air-condition (Condura)

14,500.00

Furniture & Fixture Quantity

Unit Price

Total Price

Computer Table

14

1,300.00

18,200.00

Table for Server

1

1,500.00

1,500.00

Monoblock Chair

15

249.75

4,995.00

5

89.00

445.00

Tool Chair Cabinet Total

1

1,000.00

1,000.00 26,140.00

Additional Expense 17

Pad Lock ( Abloy) P1,800.00/ unit)

Quantity

Unit Price

Amount

2

1,800.00

3,600.00

Waste Disposal The proper disposal of the garbage is very important. Since our business is a computer café we usually used bond paper, so it is not hard for us to think how it will be disposed. To maintain the cleanliness inside the café there are trash basket at one corner. Cleaning Materials Broom

60.00 ( replace every 6 months)

Dust Pan Plastic

45.00

Trash Basket Feather Dust Mop

100.00 50.00 (25.00/ pc.) 250.00

Powder Soap

20.00 ( 6pcs. Good for 2 mos.)

Air Freshener

175.00 ( replace every 2 months)

Guidelines of Business 1. All Malicious site are blocked 2. Were not allowing inserting flash drive or any storage device without the consent of the shop manager 3. Eating and drinking inside the premises is not allowed 4. Students whose wearing school uniform especially from 8am to 12pm are not allowed to play games 5. One person for one pc to maintain orderliness AMBIANCE -Not too dark not too bright because we want the shop more conducive to work and play - Our computer table have a board between user for privacy purposes * All furniture are fully furnished and labor included

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Cabinet Project Cost As a part of the business, it’s more concerned is in financing and financial feasibility that perform activities. The total project cost we will able to determine how much money consumed from the start. Total Project Composed of the following: o Legal Requirements o Equipments o Furniture and Fixture o Prepaid Supplies o Prepaid Rent o Computer Application Software & Game Software o Other Expense o Working Capital The cash flow it indicates the total cost before the operation. For the prepaid supplies and prepaid rent it will covered for one year. The improvement is composed of paint and labor, which is the cost for labor is 800.00(400.00 each person).It also include the payment of purchases such as Equipment, software, furniture and fixture and signage. Payment for legal requirements, marketing and other expense which other expense composed of padlock and cleaning materials. CYBERKADAHAN INTERNET CAFÉ PRE OPERATION PROJECTED CASH FLOW AS OF MAY 2009 Total Investment

700,000.00

Cash outflow from operations 19

Payment for Legal Requirement Payment for Equipment Payment for Other Equipment Payment for Furniture and Fixture Payment for Supplies Payment for Prepaid Rent Payment for Computer Application Software Payment for Games Software Payment for Anti-Virus Software Payment for Signage Improvement Expense Marketing Expense Pre-Operation Expense Cash available as of May 2009 PROJECTED GROSS SALES

11,014.00 328,250.00 2,000.00 26,140.00 89,819.00 120,000.00 19,200.00 6,456.00 10,800.00 4,000.00 1,800.00 12,405.35 5,335.00 62,780.65

The table shows the total sales of the business from the year 2009-2013. For every service that offered to the customers has their own specific price. With a service such as Internet/Game, it is multiply the service fee with the total minimum hours of operation in one day, then multiply it to the unit consumption day to get the total sales for the whole year. For the other services like printing, scanning, CD burning and typing job, just multiply the service fee to the total unit of consumption to get total sales for the whole year. To get the total sales for one year, add the total sales for revenue and the sales for other income. We estimated 80% of unit consumption for 1 day out of 15 hours of operation

GROOS SALES 2009

SERVICE

SERVICE FEE

YEAR

UNIT HOUR CONSUMPTION TOTAL/DAY (DAY)

(365 /317days)

INTERNET/GAMES

P15.00

12

12

2,160.00

788,400.00

PRINTING B & W PRINTING COLORED

P3.00

12

150pcs.

450.00

164,250.00

Text

P10.00

12

10 pcs.

100.00

36,500.00

picture (small)

P15.00

12

5pcs.

75.00

27,375.00

picture (medium)

P20.00

12

5pcs.

100.00

36,500.00

picture (large)

P25.00

12

2pcs.

50.00

18,250.00

SCANNING

P10.00

12

5 pcs.

50.00

18,250.00

CD-BURNING

P35.00

12

6 pcs.

210.00

76,650.00

P1.00

12

60pcs.

60.00

19,020.00

OTHER INCOME PHOTO COPYING

20

PAYPHONE TOTAL GROSS SALES

5/3mins.

12

17times

85.00

31,025.00 1,216,220.00

GROSS SALES 2010

SERVICE INTERNET/GAMES PRINTING B & W PRINTING COLORED Text picture (small) picture (medium) picture (large) SCANNING CD-BURNING OTHER INCOME PHOTO COPYING PAYPHONE TOTAL GROSS SALES

SERVICE FEE P15.00 P3.00

UNIT HOUR CONSUMPTION (DAY) 12 13 12 155pcs.

TOTAL/DAY

YEAR (365 /317days)

2,340.00 465.00

854,100.00 169,725.00

P10.00 P15.00 P20.00 P25.00 P10.00 P35.00

12 12 12 12 12 12

12pcs. 7pcs. 7pcs. 3pcs. 7pcs. 8 pcs.

120.00 105.00 140.00 75.00 70.00 280.00

43,800.00 38,325.00 51,100.00 27,375.00 25,550.00 102,200.00

P1.00 5/3mins.

12 12

65pcs. 17times

65.00 85.00

20,605.00 31,025.00 1,363,805.00

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GR0SS SALES 2011

SERVICE INTERNET/GAMES PRINTING B & W PRINTING COLORED Text picture (small) picture (medium) picture (large) SCANNING CD-BURNING OTHER INCOME PHOTO COPYING PAYPHONE TOTAL GROSS SALES

SERVICE FEE P15.00 P3.00 P10.00 P10.00 P15.00 P20.00 P25.00 P10.00 P35.00 P1.00 5/3mins.

UNIT CONSUMPTION HOUR (DAY) TOTAL/DAY 12 14 2,520.00 160 pcs. 480.00 12 12 12 12

12

YEAR (365 /317days) 919,800.00 175,200.00

15pcs 10pcs. 10pcs. 5pcs 10pcs. 10 pcs.

150.00 150.00 200.00 125.00 100.00 350.00

54,750.00 54,750.00 73,000.00 45,625.00 36,500.00 127,750.00

70pcs. 17times

70.00 85.00

22,190.00 31,025.00 1,540,590.00

GR0SS SALES 2012

SERVICE INTERNET/GAMES PRINTING B & W PRINTING COLORED Text picture (small) picture (medium) picture (large) SCANNING CD-BURNING OTHER INCOME PHOTO COPYING PAY PHONE TOTAL GROSS SALES


UNIT CONSUMPTION HOUR (DAY) 12 15 170 pcs.

TOTAL/DAY 2,700.00 510.00

YEAR (365 /317days) 985,500.00 186,150.00

P10.00 P15.00 P20.00 P25.00 P10.00 P35.00

12 12 12 12 12 12

20pcs 12pcs. 12pcs. 7pcs. 13 pcs. 13pcs.

200.00 180.00 240.00 175.00 130.00 455.00

73,000.00 65,700.00 87,600.00 63,875.00 47,450.00 166,075.00

P1.00 P5.00/ 3MINS.

12

75pcs.

75.00

23,775.00

12

17 times

85.00

31,025.00 1,730,150.00

GROSS SALES 2013 22

SERVICE INTERNET/GAMES PRINTING B & W PRINTING COLORED Text


UNIT CONSUMPTION HOUR (DAY) 12 17 12 175 pcs.

TOTAL/DAY 3,060.00 525.00

P10.00

12

25pcs.

250.00

picture (small)

P15.00

12

15pcs.

225.00

picture (medium)

P20.00

12

15pcs.

300.00

picture (large) SCANNING CD-BURNING OTHER INCOME PHOTO COPYING

P25.00 P10.00 P35.00

12 12 12

9pcs. 15pcs. 15 pcs.

225.00 150.00 525.00

P1.00

12

80pcs.

80.00

P5.00/

YEAR (365 /317days) 1,116,900.00 191,625.00

91,250.00 82,125.0 0 109,500.0 0 82,125.0 0 54,750.00 191,625.00 25,360.00 31,025.0 0

PAY PHONE 12 17times 85.00 3MINS. TOTAL GROSS SALES 1,976,285.00 The gross sales was increase every year because of our marketing strategies The below table shows the computation of the annual supplies expense. Supplies Expense is the expense incurred during the operation of the business. To compute the total expense of an specific items, it is multiply the pieces consumed with the price per unit then multiply it to the unit consumption day. For the other expense such as stapler, fire extinguisher, staple wire, ball pen, stapler wire and ink, the cost is based on unit price upon purchase.

Supplies Expense

Bond Paper (photocopy) CD Case & CD's Staple Wire Record Book Ballpen Ink Stapler Fire Extinguisher

2009 25,112.00 7,608.00 28,470.00 60.00 75.00 144.00 24,300.00 100.00 3,950.00

2010 26,864.00 8,242.00 37,960.00 60.00 75.00 144.00 25,029.00 100.00 3,950.00

2011 29,200.00 8,876.00 47,450.00 90.00 100.00 192.00 25,779.87 100.00 3,950.00

2012 32,266.00 9,510.00 61,685.00 120.00 125.00 240.00 26,553.27 100.00 3,950.00

2013 34,894.00 10,144.00 71,175.00 150.00 150.00 288.00 27,349.87 100.00 3,950.00

Total

89,819.00

102,424.00

115,737.87

134,549.27

148,200.87 23

Table shows the depreciation of equipment and furniture’s and fixture from the original price with the salvage value of 10% except the furniture and fixture. To compute the depreciation of equipment just multiplies in10% salvage value and the result will be subtracted to the original price then divided in 5 years useful life. Same in other equipment, furniture and fixture but don’t have salvage value; it is immaterial if they had a salvage value because it has a lower price. DEPRECIATION: Equipment Computer Set(19950/5 years) Cost Per Unit

Useful Life

19,950

5

Salvage Value (10%) 1,995.00

Year 2009 2010

Quantity 15 15

Book Value Per Unit 16,359.00

Net Value 299,250.00 245,385.00

Depreciated Cost 3,591.00 Total Depreciation 53,865.00 53,865.00

1 16

19,950.00 207,879.00

3,591.00 57,456.00

16,359.00 150,423.00

1 17

19,950.00 166,782.00

3,591.00 61,047.00

16,359.00 105,735.00

2013

1 18

19,950.00 122,094.00

3,591.00 64,638.00

16,359.00 57,456.00

Additional Computer

2

39,900.00

7,182.00

32,718.00

Aircon (7,000/5 years) Cost Per Unit 14,500.00 Year 2009 2010 2011 2012 2013

Useful Life 5 Quantity 1 1 1 1 1

Salvage Value 1,450.00 Net Value 14,500.00 11,890.00 9,280.00 6,670.00 4,060.00

Depreciated Cost 2,610.00 Depreciated cost 2,610.00 2,610.00 2,610.00 2,610.00 2,610.00

Book Value Per Unit 11,890.00 BookValue 11,890.00 9,280.00 6,670.00 4,060.00 1,450.00

Useful Life 5 Quantity

Salvage Value(10%) 1,450.00 Net Value

Depreciated Cost 2,610.00 Depreciation

Book Value Per Unit 11,890.00 BookValue

Additional Computer

2011 Additional Computer

2012 Additional Computer

BookValue 245,385.00 191,520.00

3 in 1(Scanner/ Photocopier/ Printer (14,500.00/5years ) Cost Per Unit 14,500.00 Year

24

2009 2010 2011 2012 2013

1 1 1 1 1

14,500.00 11,890.00 9,280.00 6,670.00 4,060.00

2,610.00 2,610.00 2,610.00 2,610.00 2,610.00

11,890.00 9,280.00 6,670.00 4,060.00 1,450.00

Furniture & Fixture Monoblock Chair Cost Per Unit 249.75 Year 2009 2010 2011 2012 2013


Salvage Value None Net Value 4,995.00 3,996.00 2,997.00 1,998.00 999.00

Depreciated Cost 49.95 Depreciated Cost 999.00 999.00 999.00 999.00 999.00

Cost Per Unit

Useful Life

Salvage Value

Depreciated Cost

89 Year 2009 2010 2011 2012 2013 Computer Table

5 Quantity 5 5 5 5 5

None Net Value 445.00 356.00 267.00 178.00 89.00

17.80 Depreciated Cost 89.00 89.00 89.00 89.00 89.00

Cost Per Unit

Useful Life

Salvage Value

Depreciated Cost

1,300.00 Year 2009 2010 2011 2012 2013

5 Quantity 14 14 14 14 14

None Net Value 18,200.00 14,560.00 10,920.00 7,280.00 3,640.00

260.00 Depreciation 3,640.00 3,640.00 3,640.00 3,640.00 3,640.00

Book Value Per Unit 199.8 BookValue 3,996.00 2,997.00 1,998.00 999.00 0.00

Tool chair Book Value Per Unit 71.20 BookValue 356.00 267.00 178.00 89.00 0.00 Book Value Per Unit 1,040.00 BookValue 14,560.00 10,920.00 7,280.00 3,640.00 0.00

25

Server Table Cost Per Unit 1,500.00 Year 2009 2010 2011 2012 2013


Salvage Value None Net Value 1,500.00 1,200.00 900.00 600.00 300.00

Depreciated Cost 300.00 Depreciated Cost 300.00 300.00 300.00 300.00 300.00

Cost Per Unit

Useful Life

Salvage Value

Depreciated Cost

2,000.00 Year 2009 2010 2011 2012 2013


None Net Value 2,000.00 1,600.00 1,200.00 800 400

400.00 Depreciation 400.00 400.00 400.00 400.00 400.00

Cost Per Unit

Useful Life

Salvage Value

Depreciated Cost

1,000.00 Year 2009 2010 2011 2012 2013


None Net Value 1,000.00 800.00 600.00 400.00 200.00

200.00 Depreciation 200.00 200.00 200.00 200.00 200.00

Cost Per Unit

Useful Life

Salvage Value

Depreciated Cost

4,000.00 Year 2009 2010 2011 2012 2013


Net Value 4,000.00 3,200.00 2,400.00 1,600.00 800.00

800.00 Depreciation 800.00 800.00 800.00 800.00 800.00

Book Value Per Unit BookValue 1,200.00 900.00 600.00 300.00 0.00

Other Equipment Book Value Per Unit 1,600.00 BookValue 1,600.00 1,200.00 800.00 400.00 0.00

Cabinet Book Value Per Unit 800.00 BookValue 800.00 600.00 400.00 200.00 0.00

Signage Book Value Per Unit 3,200.00 BookValue 3,200.00 2,400.00 1,600.00 800.00 0.00 26

FINANCIAL ASPECT Financial aspect conform the detailed computation of every financial needs of the business to determine and evaluate the project requirements, possible sources, capital financing and also the limitation of the business such as terms and condition. Capital is the most important asset in the business; it must be available at least cost when it is needed and the most important aspect among others. It admits how the business is made possible and determines the profitability of the business. Major Assumption o

The Initial capital will be Php 700,000.00.

o The projected financial statement will cover up to 5 yrs. o Equipment will be depreciated for 5 yrs. o Other Assets will also depreciated for 5 years o Software will be amortize for 5 years o Salaries will be increase 3% annually. o Light expense will be increase 3% annually. o Telephone bill/DSL increase 3% annually. o Supplies will purchase annually. o Additional equipment will purchase before the business year operate o Division of net income is a bonus method (bonus after tax) to industrial partner will be 40% and 60% to capitalist partner for the following years within 5 years of operation. o 60% of the net income is divided equally to the capitalist partner o Drawings will be 2.5 % every month based on the net income which is 30 % for the whole year. There are some objectives and guidelines to be met: o To make a safe, realistic and complete of operating revenues and costs. o To determined the liquidity, profitability and soundness of its financial position. o To determined the accumulated capital financing from partners. o To determined and ensure the necessary financial management of business will have monetary resources whenever necessary. o To make an accurate estimated total cost. 27

•

Advertising and Marketing expense it will stated on the cash flow amounting P11,377.58 on the first year because it has an expense before the operation of the business. The computation of the expense are as follows - for the membership card (100pcs. X 100.00) P10,000.00 - stamp card for points (100pcs. X 10.00) P1,000.00 - small tarpaulin 157.08 - small fliers 220.50

P11,377.58 x 2 (twice a year) Advertising and Marketing Expense composed of membership card and stamp (11,000.00) tarpaulins,fliers Total Cost 22,755.16 for the following year ● Cleaning material expense was 1,735.00 which covered one year of operation. Brooms Soap Dust Pan Trash Can Feather Dust Mop Air Freshener

120.00 120.00 45.00 100.00 50.00 250.00 1,050.00

The projected income statement, partners equity, balance sheet and cash flow it’s indicated what is the standard of the business will be. The Financial Analysis its indicate on how many percent is the return of the Current Assets and Investment. It also indicate the margin of safety of the business in order to avoid the net loss.

28

EVALUATION SUMMARY AND CONCLUSION Top 5 things to consider when putting up an Internet café 1. Capital- Planning is very important. The risks are high when going for this kind of business so you should only allot the right amount of money needed. Be sure you won’t be touching any of your family savings. Also, spare some money for your future expenses, just to be safe. 2. Study your niche/market- See to it that there is a great demand for an Internet café in your area. Obviously, the urbanized areas are the ones you would target, or as long as the place is busy with people and they will have a need for the services you’re offering. 3. Location- If your area is situated near a school then that would be a big plus. Just observe the law regarding how many meters away, your Internet café should be, from any schools or colleges. Some are not following it but the law is the law. Commercial zones within residential areas are also advisable. 4. Hardware, software and other utilities– Consider first what services you’re going to offer. For example: o

If you would only provide Internet services such as web surfing, chatting, etc., then you could go for the low-end or the average specifications for your computers. The Internet doesn’t demand much from your hardware. Just apply for a relatively fast Internet connection (DSL, Broadband, Cable) with a high bandwidth. Then install operating systems and other programs needed. Headsets with microphones are often used when chatting.

o

If you would consider adding gaming then the best specs, as much as possible or whichever the games require, should be your priority. There are the offline and online games which require Internet connection. Your clients, especially the gamers, are very demanding when it comes to the speed and reliability of both your PCs and Internet connection. You would often hear complaints about logging, hanging, or slow Internet connection. So make sure that your clients are satisfied to avoid all of those. Buy the best performance PCs and avail a faster Internet connection.

o

There are other services that you may offer your customers. You could do printing (b&w or colored), typing services, CD/DVD burning, some even have fax machines or photocopiers. 29

5. Pricing and Promotions- Know how much you’ll charge for your services. Studying the market will play a great role here. If the price is right then people will avail of your services. Some owners often use pricing as a tool to have an edge over other competitors *Be sure to apply for the necessary documents needed if you want to start your own Internet café, such as Barangay Clearance, Mayor’s Permit, DTI permit, etc. Just so your business would be legalized.

30

Recommendations When starting a new business, there are many important decisions to make and many rules and procedures that must be addressed. The number of task you need to complete and the information you need to track down before you begin a business. The followings are: I.

Basic needs to open a new business ○ Where to open your business- Deciding where to open and when to open your new business is often one of the most difficult decisions a business owner faces. These decisions may also be the most important ones because the ultimate success of the business can hinge on where it’s located and when it’s opened. To work through these decisions, choose one of the following: 1. Choosing whether to lease space or from home. 2. Choosing the best geographic location for your business. o Selecting a location- An important factor in selecting a location is that you keep a long term perspective. Site selection can be a big investment. Choosing the right site now can avoid the cost of relocation in the future. Here are some factors that you should consider in making your site decision: 1. Location of competitors. 2. Target market. o Leasing space- A lease agreement is a contract between you and the owner of the property. Since it’s a legal document, you should review it before you sign it. o Marketing your product or services- How you will market your product depends on your budget. Here are some suggestions: 1. Distribute fliers announcing your business. 2. Put a business sign. 3. Create several promotional gimmicks. o Getting licenses and permits- Before your business start to operate all the necessary legal requirements must be complied, to avoid problem in the near future. o Hiring employees- This is very important, hire people, who is trustworthy and have knowledge at your business, consider relatives and those recommended by friends.

31

II.

Starting a new business ○ Ownership Responsibilities- Probably the two most common reasons that a business doesn’t succeed are that 1) the business is poorly managed because the owner lacks the necessary skills and 2) the owner underestimates how much money it will take to start the business. To begin the process of preparing yourself, let’s take a look at: 1. Pros and Cons of owning a business: PROS: A. You have the chances to make a lot of money than you can make working for someone else. B. You’ll be your own boss and make the decisions that are crucial to your business’ success or failure. C. You may be the boss of other people. D. You’ll have job security—no one can fire you. E. You’ have the chance to put your ideas into practices. F. You may participate in every aspect of running a business. G. You’ll learn more about every aspect of a business and gain experience in a variety of disciplines. H. You’ll the chance to work directly with your customers. CONS: A. You may have to take a large financial risk. B. You will probably have to work long hours and may have fewer opportunities to take vacation. C. You may end up spending a lot of your time attending to the details of running a business and less time in those things you really enjoy. ○ Goals Setting- For many people, it helps to translate their expectations and desires into concrete terms by setting goals and these is a “Personal goals”- unlike money, many of these factors can’t be quantified but are important nevertheless. For many people, the chance to build something of their own, according to their own vision, drives them to start a business. Typical reasons that people choose to start a business include: 1. Freedom- owning your own business is a way to achieve personal freedom on many levels.

32

2. Career change- Most people change jobs or even careers several times during the course of their lives. Sometimes, it’s by choice; other times, existing jobs simply disappear. 3. Professional growth- Some people believe their ideas are being ignored or not being used properly in a corporate setting, and they want the chance to do it the “ right” way. III.

How to get Exposure for my business ○ Exposure through Advertising and Promotions- Advertising and promotions is bringing a service to the attention of potential and current customers. The goals of the plan should depend very much on the overall goals and strategies of the organizations. The plan usually includes what target markets you want to reach, how much money is budgeted for this effort.

IV.

Minimizing risk for my business o Hiring family members- A family member will more willing to step into your shoes when needed. For example, if you get tied up doing something, a family member usually makes a reliable fill-in. o Franchising- A good way to reduce your risk of failure is to purchase a franchise because franchises typically have a higher success rate than other types of small business. o Know when to cut your losses- If you don’t decide the financial commitment to your new business in advance, you may regret it in the future. o Financing assessment- Finding the money to start a new business is almost always one of the most difficult hurdles new owners face. At this point in the process of analyzing your business idea. You should have examined both the results that you know how much it should cost and how much you should be able to earn. o Legal assessment- In making a legal assessment of your business idea, you need to determine to what extent the operation of your business might expose you to legal liability.

33

Bibliography Samuel, Philip J. How to start my Business (ways to success) Yuga tech. Philippine Technology News and Reviews Real World Business, Phil FAQ’s, Really living in the Philippines Silvester, James L. 401 questions every Entrepreneur should ask Teodoro, : Benjamin D, and De Leon Hector S. The Law on Income Taxation Valix, C.T. GIC Enterprise & Co., Inc. 2008, Theory of Accounts. Manila Philippines

34

Appendices Technical Aspect * Price information of Norton Anti Virus was gathered from Microserve Computers Co. a company who merchandise a computer gadgets and software which is located at #91 Del Monte Ave Manresa 1 Quezon City. We purchase 3 packages, every package is good for 5 units with the price of 3,600.00 each and a total cost of 10,800.00. On the next year we purchase 1 package for the additional computer. •

Computer software such as Ms Office Software, Game Software and Anti-Virus will be amortized annually. -In a question about the amortization of computer software, C.T. Valix explain that “Under PAS 38, the

amortization method for a computer software shall reflect the

pattern in which the assets future economic benefits are expected to be consume by entity. - If such pattern cannot be determined reliably, the straight line method is used (683) -Based on personal interview of Mr .Emmanuel Sadiua CPA, SGV Auditing firm that the computer software product shall be charge to expense when incurred until at technical feasibility has been established for the product.

Operation Aspect *The information of signage, membership card and stamp amount was came from Mr. Richard Corpuz designer of NANETSKI ARTS & SIGNS located at #2 J.P Rizal .St.Nangka Marikina City tel. no. 942-0944/942-3331 a

* We gathered the pricelist of the office supplies from Ms. Rose of Robens Commercial, except for Fire Extinguisher from Mr. Gil

G.Guindayao of JCI Junior Chamber International

Philippines (Bronco Fire Extinguishers/ Tear Gas.

* Information of the equipment’s amount came from many sources like online internet shop such as PCgilmore,

35

*We gathered information of chairs amount at 4th floor Ever Gotesco Caloocan. - The amount of Computer table/table for server & cabinet was based according to Ms. Rhea Cunanan owner of Counter Strike Computer Shop at #191 Gen. Evangelista St., Bagong Barrio Caloocan City. * The amount of padlock was based according to Ms. Maricel Tan of Seahorse Hardware at Malabon City *We gathered information of chairs amount at 4th floor Uniwide Sales Caloocan. * The allocated amount of Maintenance for Aircondition is 450.00 according to Mr. Radian Ramos of Maintenance head of MKZ Collection.

36

Processor- Intel ® Pentium ® 4 CPU 1.50 Ghz 1.50 Ghz, 512 MB of RAM Monitor- 16” Nexview Keyboard Webcam Headset Powerplus 500w AVR Php. 19,500

HP OFFICEJET 2610 PRINT/SCAN/COPY (PSC)

Php. 14, 500.00

37

SOFTWARE OUTLET.COM Microsoft Office 2007 Professional (Academic Box) Price: 19,200 Product Code: Platform: Package Type:

COUNTERSTRIKE

PRICE: Php 350.00

WARCRAFT

O2 JAM

LIST

PRICE: Php 1,968.00

PRICE: php 1,450.00 DANCE AUDITION PRICE: Php 1,968.00

BATTLE REALMS LIST PRICE: Php 720.00

NORTON ANTIVIRUS 38

PRICE:

Php. 10,800.00

MEMBERSHIP CARD



INNOVISION TRADING 227A Mayon St., Maharlika Quezon Tel No. 0923-9370029 39

QUOTATION

March 10, 2009 To : Cyberkadahan Internet Café #82 Samson Road Caloocan City Dear Sir/Madam, Below is our quotation for the following requirements ITEM

PRICE

1 pc. 35”x 70” Tarpaulin

P340.27

1 pc. 29” x 39” Tarpaulin

P157.08

Total

P497.35

Terms: 50% Downpayment , 50% Balance upon delivery Schedule of Delivery:2-3 days from receipt of downpayment. Sincerely yours Ms. Flor N. Pinili Account Executive Noted by: Peter Beng Hui General Manager

GLORY TO GOD ENTERPRISES WHOLESALER & RETAILER 40

Dealer of Hardware, Electrical Appliances, Kitchenwares Furniture, School & Office Supplies

Date : March 11, 2009 To : CYBERKADAHAN INTERNET CAFÉ

Below are our respective prices for the following items:

1 unit

Condura Aircon 1.5 HP

P14,500.00

Terms: ____________________ Delivery Date: _____________

Mr. Eddie Chua Proprietor

41

PCGILMORE All Digital Hub (Caloocan) Unit 113 Aurelio Bldg., 1 Rizal Ave. Ext. cor. 9th Ave. Grace park, Caloocan City Tel No. 721-3496 Attention : CYBERKADAHAN INTERNET CAFÉ We are pleased to submit herewith our price quotation for ink product enumerated below as per your requirements INK CARTRIDGE for HP OFFICEJET 2610 Photocopier/ Scanner/ Printer HP 96 BLANK INK CARTRIDGE

P800.00

HP 97 TRI – COLOR

P850.00

We thank your for giving us the opportunity to quote our prices to you. For further questions please contact us at all PC GILMORE outlet as are follows:

Gilmore Branch 3F Computer Graphics Bldg., Gilmore Ave., Quezon City 721-3496 0922-599-8032 [email protected] pcg_main_inquiry

West Avenue Branch 144 West Ave., Philamhomes, Near Edsa Quezon City 924-5914 0922-599-8053 [email protected] pcg_west

VMall Branch Unit V338 3rd Floor Vmall, Greenhills, San Juan M. Mla. 727-8988 0922-811-3616 [email protected] pcg_vmall

All Digital Hub (Caloocan) Unit 113 Aurelio Bldg., 1 Rizal Ave. Ext. cor. 9th Ave. Grace park, Caloocan City 361-1902 0922-746-5474 [email protected] pcg_caloocan

PC Gilmore Xtreme 2F Gilmore Commercial Plaza, Gilmore Ave., Quezon City 727-8852 0922-928-5085 [email protected] pcg_xtreme

Sincerely Yours Ms. Kate Permida PC Gilmore Admin

ROBENS COMMERCIAL

42

QUOTATION March 11, 2009

Attention : Cyberkadahan Internet Café QTY.

UNIT

DESCRIPTION

UNIT PRICE

Ms. Rose

March 11, 2009 Attention to Ms. Jackie Number of hours: 15 43

Number of days : 7 Number of weeks : 4 APPLIANCES

COST/ HOUR

AIRCON ( 1hp) 3 IN 1 PSC 1 CEILING FAN 15 COMPUTER SET FLOURESCENT BULB TOTAL COST

7.44 1.33 1.27 24.48 4.00

COST/ DAY 111.60 19.95 19.05 367.20 60.00

COST/ WEEK 781.20 139.65 133.35 2,570.40 420.00

COST/ MONTH 3,348.00 598.50 571.50 11,016.00 1,800.00 17,334.00

REFER KO PO SA INYO ANG AMING "MAC" MERALCO APPLIANCE CENTER. MAKIKITA PO DITO KUNG MAGKANO PER HOUR / DAY/ WEEK AT MONTH ANG BAWAT APPLIANCE.

http:// meralco.com. Ph./ Consumer/mybill/calculator.htm

THANK YOU PO. FEEL FREE TO ACCESS OUR MAC ENGR. YSID NICOLAS 4498712 FEDCHEM MARKETING COMPANY INC. March 12, 2009 CYBERKADAHAN INTERNET CAFÉ Caloocan City Tel.No. 448-8888

Attention: Ms. Evelyn Macabodbod We are pleased to submit herewith our price quotation for paint product enumerated below as per your requirement Description

Size

Color

Amount

Aquabloc Elastomeric Sealant

4 ltrs.

Powder Blue

P500.00 44

Discount : Net of price Terms : C.O.D Delivery : 2- 3 days from the day of purchase order We thank your for giving us the opportunity to quote our prices to you. For further questions please do not hesitate to call the undersigned at tel nos. 361-0291/361-0292 look for Roland.

Sincerely Yours Reny Medina Sales Representative

45

SURVEY Name

School

Games Print

Photocopy

Internet

Counter Strike

Ezekiel Mersigan

UCC

x

x

x

Floriza Juat

UCC

x

x

x

Kenneth Adrian Lorico Mark Kevin Remoliza

Gomburza ( Elem.) UE (High School) UE (High School) UE (High School) MCU ( Elementary)

x

x

x

x

x

x

x

x

x

x

x

x

x

x

x

x

Jerwel Abogador Rafael Dimayuga Jelyn Ramos

Perfect World

Left for Dead

Dota

x

x

Dance Audition

O2 Jam

x

x

x

Andrew Makinano

UCC

Arian Uy

UE

Anna Segura

Divine Mercy

x

x

x

Maribel Mejia

Divine Mercy

x

x

x

x

Julie Ann Dumario

Divine Mercy

x

x

x

x

x

x x

x x

x

46

A Feasibility Studies of Cyberkadahan Internet Cafe

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