Executive Summary

Introduction

Love & Pair Co. is a partnership business with a purpose of selling

lovebirds within and outside the Philippines. It offers many breeds of lovebirds

such as Fischer’s, Peached face, Black Masked and Nyasa Lovebirds for various

choices of customers. Love & Pair Co. has the potential to compete with other

sellers of love birds and pet shops because the facility will not only include a

store but also a capacity for breeding and an aviary to ensure the good quality of

the love birds. Love birds are to be sold in the international (Southeast Asian

Countries, particularly in China) market as export products. Additionally, Love &

Pair Co will cater the domestic market by being a supplier to pet shops within the

vicinity and also selling to walk-in customers.

Summary and Findings:

Marketing Aspect

Lovebirds as the product of Love & Pair Co. is marketable to people. Factors

that support this conclusion are as follows: the trend of owning lovebirds as pet

has paved the way for this unique business venture. These factors tied up with a

good use of marketing strategies and impeccable location suggests success in

market positioning with the use print ads like flyers, brochures and posters to

easily inform the target audience. On the grand opening of the shop, the store

will offer promotions to encourage the poeple to buy. The broad variation of

people as the main target market of Love & Pair are type of market that

influences big market or has the ability to aim viral marketing, in that way Love &

Pair would be easily known by the market.

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Technical Aspect

Love & Pair Co.’s need for materials (both direct and indirect), labour,

equipment, tools, utilities, and aviary and shop location is affordable, existing and

accessible. The processes used for manufacturing the products such as Process

of Breeding, Breeding/Reproduction, Sexing Lovebirds, Egg Laying and

Hatchlings, Hatchling Care and Weaning, Selling Lovebirds within and outside

the country are technically possible.

Management Aspect

The owner of Love & Pair Co. decided to manage the business to be a hands-

on type business in order to maintain the quality of the products that is being

produce during the production process. Employees will be compensated and

treated well by the owner and will have a seminars and trainings focusing on how

to make the product and explain the benefits that could get in the product to

make sure that the products to be sold will be understood well by the consumers.

Financial Aspect

The 5 Partners will contribute Php 400, 000 each totalling Php 2,000,000 as

an initial investment for the business and each of them has a wide knowledge in

managing the day-to-day and business operation. Profits will be shared by the

partners equally as a form of return of their contribution. Earnings of the

corporation are taxed with accordance of Tax Laws and Regulations. Financial

statements are projected for ten (10) years consisting of Statement of Financial

Position, Statement of Financial Performance, and Statement of Changes in

Owner’s Equity, Statement of Cash Flows, and Notes to Financial Statements.

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Social Aspect

Love & Pair Co. provides good quality and satisfactory service to its

customers. Additionally, it gives those out of work the opportunity to be

employed. It also builds a well-balanced relationship among its employees.

Moreover, it complies with different requirements of government agencies.

Environmental Aspect

Proper waste management is adopted and put into operation to ensure that

the environment will not be sacrificed for the firm’s purposes. Since Love &

Pair Co. is an environment-friendly business, its biodegradable wastes are

handled and used as fertilizers. Furthermore, Love & Pair Co. carries out

activities that comply with different environmental regulations. The company

has its two socio-economic plan, first Environment consciousness program in

this program it is to help maintain the clean environment near the facilities,

also it helps to avoid floods and prevent clogged drainages.

Owner and workers of Love & Pair will be participating in the corporate social

responsibilities by helping cleaning a barangay near the shop, in order to

show their concern with the surroundings, which they are willing to participate

with other environment maintenance programs.

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Project Background and History

The following names listed are the project promoters who will be

contracting under a corporation type of business:

PROMOTERS RESIDENCE

Castillo, Jophet M.10th Avenue, Caloocan City

Cañas, Arbiegail D.Marilao, Bulacan

Indiongco, Mark Harold V.Liparo, Caloocan City

Naranjo, Pauline Mae L.Parada, Valenzuela City

Tumalad, KlevinEmilor E.Sangandaan, Caloocan City

Mission

The company endeavours to be acknowledged in the national and

international market, specifically Southeast Asian Countries as a highly regarded

source of a wide selection of good variety and quality lovebirds. The company

aspires to be involved in the endorsement of the sustainable progress of lovebird

species by adopting ethical breeding practices, and supporting its preservation

both in their captive and natural environments.

Vision

Cognizant of the challenges of the rapidly developing digital age, Love &

Pair Co. envisions to eventually be a One-Stop Bird Shop in the vast global

market with the upgrade of the company's telecommunications technology,

thereby making web-based viewing and purchasing of bird variety fast and easily

accessible.

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Objectives

The primary objective of the business is to offer quality and finest lovebirds both

inside and outside the country and o provide accessible lovebirds breeding and

selling in Metro Manila.

Secondary objectives are the following:

1. To satisfy the needs of those who owned and wants to own lovebirds.

2. To offer comfort to customers with the joy that lovebird can provide.

3. To earn revenue in return for the lovebirds sold.

Customer Service Goals

• To set up questionnaires and feedback channels to quickly respond on

their complaints

• To constantly conduct customer service research process to quickly

adapt to their changing demands and improved quality of product

• To build a strong customer relationship so as for them to continuously

patronize our products

Revenue Goals

• To cover up daily operating expenses

• To efficiently use available resources

• To increase sales and net profit by the end of each current year

• To maximize the wealth of the owner by providing a positive

return on investment

• To pool excess into funds for expansion

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Community and Environmental Goals

• To involve the company and its employees on environment-friendly

practice and policies

• To continuously use eco-friendly packaging materials

• To promote campaigns and outreach programs that has positive

effects on environment

• To alleviate unemployment in the locality

Logo

This is the logo of the company. L & P represent the words love and pair.

A simple yet elegant logo to show that simplicity will show the beauty on it. Just

like the products, Love and Pair Co. offers good quality lovebirds.

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Business Name

LOVE & PAIR Co. The business is named love & pair because it primary

deals with lovebirds, the researchers believed that in able for the owners to

achieve a successful owning and breeding of lovebirds, the owner should love

the lovebirds first. By doing so, they can pair and match their lovebirds gradually.

Another thing is that, lovebirds cannot live alone, it must be in pair. With this, the

researchers came out with the idea of naming the business as Love & Pair. Love

& Pair Co. is a business name not only pertaining to taking good care of the

lovebirds but also the customers because this type of business is created for

lovebirds enthusiasts.

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Chapter I

Marketing Aspect

Current Market Situation

Love is in the air – lovebirds that is. The lovebird is one of the many

breeds and varieties of birds that people choose to keep as pets.  The most

popular pets are dogs and cats. Although a bird is not the most popular pet, it is a

very nice addition to the home and can even become part of the family.

Lovebirds are most commonly kept in pairs since their popularity is largely due to

their monogamous pair bonding and the long periods in which the pair will spend

sitting together. They usually eat fruits, vegetables, some grasses and seeds. 

They are rather small but can be a marvel to look at since they possess different

bright colors which are part of their natural characteristics.

These pets are now becoming popular as business ventures as well.

Good business, low maintenance and a tidy return investment all combine for an

ideal alternative to the old school tradition of breeding of other kinds of pets.

Most breeders of lovebirds would take the time to share selling tips with

each other. They freely lecture on care and other know-hows and are happy

simply to find others who share their interest. A lot of large breeders have

established aviaries in different part of Luzon. You can find one in Bulacan,

Valenzuela City, Parañaque City, Cainta, Rizal, as well as in San Pedro, Laguna.

Small breeders can be found in the Manila and Quezon City areas. Breeders

though in Bulacan, Cainta, Laguna, and Batangas are often willing to bring their

birds to the city by arrangement at no or minimal additional costs. With that, the

researchers came up with the idea of breeding and selling lovebirds not just in

NCR area but also outside the country. Direct selling will also be applied for

those people who just want lovebirds as their pet.

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Love birds exporting industry grows bigger. As such, Asian countries like

Thailand, Malaysia, Indonesia, and Korea are just some which exports this kind

of bird.

Varying methods of selling lovebirds are currently employed. Word of

mouth, print advertising, placing ads in Pet Care and classified ads magazine

such as Buy & Sell, also with the trends of new technology and social media, it

will be easier to market lovebirds through selling online on personal websites and

advertising at different community seller and social sites such as Ayosdito.ph,

Sulit.com, Facebook, Tumbler, etc. Most customers make another purchase if

they are happy with the initial bird/pair bought. Referrals from seller to seller are

also given.

SWOT Analysis

Strengths

1. Accessibility of the shop. Love & Pair is located along McArthur Highway,

Valenzuela.

2. Experienced management and well-mannered personnel. Love & Pair’s

aviary is managed by well-experienced and knowledgeable breeders of

lovebirds to maintain the quality.

3. Love & Pair Co. will offer a variety of breed of which the customers can

choose from. Moreover, different colour mutations of love birds as a

product of pairing will also be a factor for customers’ purchasing decision.

Weaknesses

1. Taking care of love birds need adequate attention. If they do not have

adequate attention either from another lovebird or from the caretaker they

may become depressed and die.

2. Higher cost will be incurred in hiring well-experienced love bird breeder.

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3. There is a need for premium pricing of love birds depending on the age,

breed, and colour mutations.

Opportunities

1. Bigger market. Love & Pair exports lovebirds not just in the Philippines but

also in some other parts of the world. In the domestic setting, Love & Pair

can be a supplier of love birds for small pet shop owners because it has

breeding facility.

2. Unlike any other pet shops, Love & Pair Co sells love birds alone. This is

to establish, maintain and keep the specialty for love birds. It is a shop for

lovebird’s enthusiasts. They can provide everything who is indulge into

taking care of lovebirds.

3. The demand for love birds fluctuates from period to period.

4. The number of love birds grow rapidly in a short span of time through

breeding, thus, the demand for love birds can be satisfied because of

adequate supply.

5. It opens Philippines’ doors to foreign investors as Love & Pair partnership

goes well in the foreign market. It promotes Philippines, lovebirds industry

all over the world.

Threats

1. Love birds exporting industry is growing faster. Competition is growing. as

Thailand, Malaysia, Indonesia, Bahrain, Korea and Australia are just some

of the love bird exporting countries in the world.

2. In domestic setting, a number of small pet shop owners which also sells

love birds can lead to tight competition.

3. There are risks and exposure love birds to health problems (e.g bird flu)

that may be transferred to humans as well as the effect of natural and

environmental threats to these love birds.

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Objectives

4. To satisfy the needs of those who owned and wants to own lovebirds.

5. To offer comfort to customers with the joy that lovebird can provide.

6. To provide accessible lovebirds breeding and selling in Metro Manila.

7. To offer quality and finest lovebirds both inside and outside the country.

8. To earn revenue in return for the lovebirds sold.

Market Segment

Market segmentation is the process of identifying groups of buyers with

different buying desire or requirements. It involves targeting and narrowing-down

the markets. It is the division of a market into a distinct group of consumers that

require different products or marketing mixes.

By giving it a marketing edge, the business will find its way to be more

effective and marketable. Segmenting a group of consumers as the target market

will make it easier for Love & Pair to promote the product effectively rather than

focusing on the average customers. With that, Love & Pair will apply two market

segmentations due to the domestic and foreign markets which the said business

is involved. For the domestic market, Love & Pair Co. will primarily apply

Psychographic Segmentation which means the business will focus on the group

of consumers according to their lifestyle, values, and personality being

considered. For the foreign market, Love & Pair will apply Geographic

Segmentation; this involves the geographic criteria as to nation, location, cities,

and neighbourhoods.

Target Market

The researchers of Love & Pair had identified two target markets of

lovebirds, the domestic and foreign market.

For the domestic market, Love & Pair will target the pet shop owners in

Metro Manila and across the Philippines to be their supplier of lovebirds. In

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addition, Love & Pair Co. will target the individual or household pet lovers who

reside in Metro Manila. Also, the company will serve walk-in customers for either

retail or wholesale purchases of lovebirds.

For the foreign market, Love & Pair will target the importers of lovebirds in

Southeast Asian region such as China, Indonesia, Japan, and Singapore. The

countries that are included here are based on the results of the accomplished

survey, tied up with internet research of some information regarding the countries

that import birds.

Competitors

Since the business is intended for domestic and export selling, Love &

Pair considers two types of competitors based on geographic location; the

domestic and foreign competitors. Competitors that are considered in this portion

are those who are involved or engaged in selling or breeding primarily birds

alone and not any other live animals. For domestic competitors, the researchers

take into account the location of its competitors in relation to the location of the

Love & Pair Shop and Aviary. Thus, only direct competitors from the National

Capital Region are considered. On the other hand, competitors in the Southeast

Asia region are considered for foreign engagements.

A. Domestic Competitors

Badilla Aviary

Badilla Aviary is situated in Parañaque City which is currently breeding

seven of the nine species of African love birds. This aviary is engaged in

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exporting. Eighty percent (80%) of their breeder birds are imported from

Belgium, Thailand, United States and Holland and the other twenty

percent (20%) comes from the top five percent (5%) of their own

production. They import love birds from these countries to infuse new

blood to their existing flock and to acquire the latest mutations other

countries has to offer. They perform out-breeding or cross-breeding to

heighten the diversity of love bird mutations.

Manny Ballada Farm

Ballada Farm is located in Valenzuela City. The farm has around 6,000

species of small birds including parakeets, eyering love birds, African love

birds, cockatiel, zebra finches, gouldian finch, society finch, opalinelutino

and opaline white face. In addition, Manny Ballada also owns a pet shop

situated in Pasay City. The business is also engaged in exporting birds.

B. Foreign Competitors

Pin Farm

Pin Farm is located at the tropical country of

Thailand. It has a tagline “Only the quality love

birds you can find”. The farm has 700 pairs of

male and female breeders. The farm is open

for visitation and maintains excellent quality

when it comes to cleanliness and use of

technology for its facilities. They export love birds to different countries

around the world with Cites Paper and Certificate of Health. Aside from

being an exporter of love birds, the owner of Pin Farm,

YutthanaImanothai, also owns a bird shop called Pin Shop.

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Marketing Mix Strategies

Love & Pair plans to have more than a few advertising tools and strategies

in promoting the product as well as its shop and aviary, among these are print

media, interactive, social and internet media, as well as customer relationship

management. The researchers plan to establish customer awareness regarding

the products offered, and work toward building purchaser constancy and

referrals. Falling under this marketing mix strategies are the successful

identification of the factors affecting the marketability of love birds. With this, the

researchers used the following strategies, the seven P’s:

1. Product

Love & Pair offers a variety of love birds. Lovebirds based on their

species, kind, color and age.

2. Price

Love birds are reasonably priced depending on its age, breed and color.

For export, Prices excludes freight charges, CITES and Veterinary

charges subject to change, subject to devaluation and that the birds are

unsold.

3. Place

Love & Pair Co. will be situated at the #38 MacArthur Highway, Potrero,

Malabon City. It is strategically located in the place because it is

accessible and can be easily found by customers. It has as its neighbour a

school where there are many children who can be the target market of

selling love birds.

4. Process

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The process that may be involved in the business is the caretaking and

breeding of love birds. To ensure the good quality of the product,proper

and adequate knowledge of the technical aspects of caring for love birds

should be possessed by the caretaker. Love birds must be provided with

sufficient nutrition (food, water and vitamins), proper ventilation, clean

shelter and a nestling area within its cage. Also, a well-trained and keen in

observing the proper pairing of love birds in order to ensure that they will

produce an offspring on expected time after pairing, and to avoid lapse of

time if the pairing is not successful.

5. People

The personnel that will be employed in Love & Pair will undergo a

thorough screening and tests to ensure that they would fit in and qualify

for the positions or work they are task to do. With regards to the

caretaking of the love birds, the caretaker must be well-experienced and

knowledgeable about the love bird stuffs and must possess a loving and

caring attitude towards animals. Caretakers will be required to undergo

trainings or workshops in relation to the proper caring and treatment,

technical knowledge (feeding, pairing, breeding, nestling) about love

birdsin order to heighten competence, as well as, to develop

communication skills in dealing with customers.

6. Promotion

Promotion is a way of communicating or introducing a new product to the

market. By way of promoting the product, the potential customers may

have a grasp of what the product is all about, the details of it and it helps

in the decision of the market whether to buy the product or not. For Love &

Pair Co., the following promotion strategies will be executed:

a. Print Media

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Flyers, brochures and business cards will be given to the target

market containing message that proponents will seek to

communicate. The said flyers and brochures will contain the

company name, location of the shop and list and pictures of the

products offered. Print ads will be posted on different areas in

Metro Manila.

Below is a sample design for the print ads of flyers, brochures and

business cards.

Broadcast Media

The researchers of Love & Pair strongly believe in the power and

influence of online technology and internet in gathering information

and as a means of communication. Nowadays, it is much easier to

connect with other people from different places through social

networking sites like Facebook, Twitter, Multiply and the like. Added

factor to this is the wide access of people to the internet. Love &

Pair will be able to reach a vast array of prospective customers and

spread a more explanatory form of advertisement for both domestic

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and foreign market. Love & Pair will also create an official website

for online advertisements wherein pictures of product lines, prices

and contact details will be included to provide the customers with

convenience and a preview of what the company is offering to

them. This is the web design of Love & Pair Co. :

c. Customer relationship management

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Love & Pair will prioritize in establishing long-term and good

relationship with the customers, as well as building the trust and

confidence of the customers to the quality of lovebirds and products

that Love & Pair are providing. Word of mouth and referrals are

effective advertisement.

d. Interactive marketing

Know customer’s satisfaction level, feedback and new expectations

to help increase the enjoyment of the customers. Ask the

customers how they found out about the business. Know their

complaints and handle it promptly. Accept comments from

customers. Query handling on telephone as well as personally.

MARKETING PROGRAM

DATE PROGRAM MECHANISM BUDGET

One week

before

operation

Flyers Flyers will be distributed in some

malls in Metro Manila to

increase the awareness and

attention of having a Lovebird

shop and aviary near place/

Php 600.00

Tarpaulins Love & Pair will be using

tarpaulin to attract and call

attention of the target market

Php 2500.00

At least once

a month

during the

operation

cycle

Leaflets/

Brochures

Love & Pair will use leaflets and

brochures to showcase not just

the species and breeds of love

birds that Love & Pair is offering

but also to showcase our shop

and aviary as well as the quality

of our facilities.

Php6,000.00

Start of Social Media This marketing mechanism will Php 6,000.00

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operations to

an indefinite

period

Marketing and

Internet

website

be used to communicate

virtually with almost all people to

bring to their attention the

existence of the Love & Pair.

Through creating social network

accounts in sites like Facebook,

Twitter, Tumbler and blogs,

Love & Pair can discuss matters

related with providing

introducing the product to the

target market. In addition, an

official business website will be

developed in order to provide a

wide range of information to the

potential customers with

convenience and ease

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PRODUCT SURVEY

A monkey survey was conducted in the internet through Google and Facebook.

The online survey questionnaire was spread on to different people across the

country and to some other parts of the world through Facebook chat.

Survey Results

Location of Respondent No. of Respondents Percentage

Philippines 96 76.80%

Others 29 23.20%

TOTAL 125 100.00%

The location or residence of the respondents is considered in determining

the target market as well as the probable demand for love birds in different

locations. According to the survey conducted, majority are residing in the

Philippines. In that case, the business will not only cater foreign transactions

(exporting) but also, will attend to the demand of Filipinos (domestic).

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Location of Respondents

Philippines

Others

Location of Respondents

Philippines

Others

Location of Respondents

Philippines

Others

Location of Respondents

Philippines

Others

The 23.20% of the total survey population answered “Others” in this

question. Primarily, it is identified that this percentage represents the number of

foreign respondents who took the survey. The following figures show the tally of

foreign respondents with their respective locations/countries:

Survey Questions:

1. What kind of pet do you prefer? No. of Respondents Percentage

Dog 49 39.20%

Cat 31 24.80%

love birds 28 22.40%

Fish 17 13.60%

Total 125 100.00%

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CountryNo. of

Respondents

California 3

Canada 3

Chicago 1

China 2

Colorado 1

Dubai 1

Hongkong 1

Indonesia 4

Japan 3

New Jersey 2

Singapore 2

Taiwan 1

Thailand 2

UK 3

Total 29

The respondents were asked what kind of pet they prefer in order to

estimate the potential buyers of the product.

2. Are you willing to have love

birds?No. of Respondents Percentage

Yes 73 58.40%

No 52 41.60%

Total 125 100.00%

22

39%

25%

22%

14%

1. What kind of pet do you prefer?

dog

cat

love birds

fish

58%

42%

2. Are you willing to have love birds?

Yes

No

The respondents were asked if they wish to have love birds. This question

also estimates the demand for love birds in the population. In here, majority of

the respondents, which constitute 58% of the total population sample affirmed.

3. From where do you buy pets? No. of Respondents Percentage

Pet shop 102 81.60%

Market vendors 8 6.40%

Online sellers 4 3.20%

Breeders 5 4.00%

Others 6 4.80%

Total 125 100.00%

The inference that may be gathered in this question is the marketplace or

location where there is a demand for pets. Also, in these places, there are

possible threats, in the form of competition, and opportunities. Majority of the

respondents answered “pet shop” as the main source. Those who answered

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82%

6%

3%

4% 5%

3. From where do you buy pets?

Pet shop

Market vendors

Online sellers

Breeders

Others

“others” have acquired their pets as a gift from someone and some through direct

purchase from breeders.

4. Why do you buy pets? No. of Respondents Percentage

Passion for pet 80 62.50%

Breeding purposes 13 10.16%

Buy and sell 3 2.34%

Hobby/collection purposes 21 16.41%

Others 11 8.59%

TOTAL 128 100.00%

*Respondents can have more than one answer.

Some reasons are motivating the respondents to buying love birds. These

may particularly relate to the different preferences of them which may result to

the demand of customers to a product. The results of the survey shows that

majority (62.40%) of them buy love birds because of their passion for pet.

5. What benefits do you get in

having pets?No. of Respondents Percentage

Happiness and satisfaction 107 82.31%

Form of income 8 6.15%

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63%10%

2%

16%9%

4. Why do you buy pets?

Passion for petBreeding purposesBuy and sellHobby/collection purposesOthers

Others 15 11.54%

TOTAL 130 100.00%

The more benefit and satisfaction that a customer gets from a certain

product, the more that he is willing to buy and ask for more. Thus, more demand

will generate to more revenue.

6. If given a chance, how many love

birds are you willing to buy?No. of Respondents Percentage

One to three pairs 98 78.40%

Four to ten pairs 9 7.20%

Eleven to twenty pairs 4 3.20%

Twenty to one hundred pairs 3 2.40%

Others 11 8.80%

TOTAL 125 100.00%

25

82%

6% 12%

5. What benefits can you get in having pets?

Happiness and satis-faction

Form of income

Others

Question No. 6 generally answers in numerical terms the demand of

potential customers for love birds. In relation to the previous question nos. 4 and

5, of which majority answered passion for pet and happiness and satisfaction, the

researchers may conclude that a large number of potential buyers are individual

purchasers and they buy for personal or emotional satisfaction, not for business

purposes. The findings in this question shall be used as a basis for the analysis

of demand to be further discussed in preceding sections of this chapter.

7. How much are you willing to spend in

buying a love bird?

No. of

Responde

nts

Percentage

P600 – P1500 (approximately 15 to 37 USD) 86 68.80%

P1500 – P3000 (approximately 37 to 73 USD) 22 17.60%

P3000 – P6000 (approximately 73 to 146 USD) 9 7.20%

P3000 – P6000 (approximately 73 to 146 USD) 5 4.00%

P9000 above (approximately 220 USD and 3 2.40%

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78%

7%3%2% 9%

6. How many love birds are you willing to buy?

One to three pairsFour to ten pairsEleven to twenty pairsTwenty to one hundred pairsOthers

above)

TOTAL 125 100.00%

The costing of the product is also considered by the researchers by asking

the respondents how much they are willing to pay for a love bird. This will serve

as the basis on the range of prices the researchers can sell their product that the

customers are still willing to buy.

8. What type of love birds do you

want to buy?No. of Respondents Percentage

African 29 23.20%

Eyering 42 33.60%

Any type available in stores 34 27.20%

Others 20 16.00%

TOTAL 125 100.00%

27

69%

18%

7%

4% 2%

7. How much are you willing to spend in buying a love bird?

P600 – P1500 (approximately 15 to 37 USD)

P1500 – P3000 (approximately 37 to 73 USD)

P3000 – P6000 (approximately 73 to 146 USD)

P3000 – P6000 (approximately 73 to 146 USD)

The variety of love birds are also considered by the market in buying.

Here, the researchers would want to know the breed of love bird which will

provide greater demand and that to be able to observe the fill up the demand for

that specific breed. Exposed in the survey, most of the respondents would like to

buy Eye-ring love birds. Each breed has an assortment of species and

subspecies.

9. Are you willing to buy love birds

from outside the country?No. of Respondents Percentage

Yes 53 42.40%

No 72 57.60%

TOTAL 125 100.00%

28

23%

34%

27%

16%

8. What type of love bird do you buy?

African

Eyering

Any type available in stores

Ohers

42%

58%

9. Are you willing to buy love birds from outside the country?

YesNo

The analysis that can be reaped from this question is the potential

demand of love birds in the export industry. Out of 53 respondents who said Yes,

26 are foreigners (about 90% or 26/29 of the total non-resident respondents who

took the survey). This implies the positive demand for love bird exports in other

countries. Furthermore, out of the 72 respondents who said No, 70 are Filipinos

(representing a majority of Filipino respondents who took the survey). From that

information, it may be concluded that there are also great demand for love birds

in the domestic setting.

10. If yes, what country? No. of Respondents Percentage

Philippines (for foreign respondents) 25 32.47%

Africa 22 28.57%

Thailand 15 19.48%

Malaysia 7 9.09%

Indonesia 5 6.49%

Others 3 3.90%

TOTAL 77 100.00%

29

32%

29%19%

9% 6% 4%

10. If yes, what country? (Refer to previous question.)

Philippines (for foreign respondents)

Africa

Thailand

Malaysia

Indonesia

Others

*Respondents who answered “Yes” in the previous question may select more

than one option in this question.

This question identifies which among love bird-exporting countries are

likely to be the tight competitor. From the information gathered, Africa is the most

selected after by the Filipino respondents. Though, Philippines seem to have

good standing when it comes to exporting, evidenced by having the biggest

percentage in the survey population. This shows a great opportunity of the love

birds exporting in the business industry.

Computation of Demand

To compute for the estimated total demand for love birds, the researchers

conducted the following:

a. In an interview conducted by the researchers on November 24, 2012 they

were able to get data regarding the demand for lovebirds. Engr. Fred R. Pangan,

a breeder for almost 10 years, said that demand for lovebirds is increasing.

During 2011, he only delivered lovebirds to small pet shops and he had four

regular customers who regularly ordered an average of 10 lovebirds every week.

As of 2012, he already had 6 regular customers who commonly ordered 15

lovebirds and he honestly said that he could not supply this at some time.

Through this, it is showed that demand for lovebirds is increasing.

b. The researchers also interviewed a middleman who was buying lovebirds to

Engr. Fred. He told the researchers that there are four (4) businesses that he

was working to regarding the exportation of lovebirds. He ordered four (4)

lovebirds costing Php 3,800.00 each. The middleman told the researcher about

the countries who were importing lovebirds namely: Thailand, Indonesia, Korea,

Bahrain and Malaysia. Through this, the demand and supply for exportation is

based.

30

Weekly (in pairs) Growth rate

Vendor demand supply demand supply

1

2011 14 8

2012 18 10 0.29 0.25

2

2011 14 6

2012 20 8 0.43 0.33

3

2011 12 6

2012 16 8 0.33 0.33

Average

Growth

Rate

(Export) 0.35 0.29

In the table above, it showed the demand and supply of three vendors

from China interviewed via Internet. They were also selling via online. Through

this, we gathered the needed information to get the growth rate of exportation.

c. Another interview was conducted last January 18 at five (5) pet store owners in

Cartimar Shopping Center in Recto. Through this, the researchers were given

estimations regarding the demand for lovebirds and it is shown in the table

below:

Weekly (in pairs) Growth rate

Vendor demand supply demand Supply

1. Sir Raymond

2011 14 8

2012 20 10 0.43 0.25

31

2. Sir Jessie

2011 10 6

2012 14 8 0.40 0.33

3. Sir Joseph

2011 14 8

2012 18 10 0.29 0.25

4. Jun

2011 10 4

2012 16 6 0.60 0.50

5. Sir Gerald

2011 8 6

2012 12 8 0.50 0.33

6.Engr. Fred

2011 10 6

2012 14 8 0.40 0.33

7.Sir Francisco

2011 18 10

2012 22 12 0.22 0.2

Average

Growth

Rate

(Domestic

) 0.41 0.31

For the computation of growth rate, the given data from 2011 and 2012 are used.

By getting the difference of present and past demand then divide the difference

to the past demand you will get the growth rate.

Growth Rate = (Present Demand – Past Demand)

Past Demand

32

d. Based on the question number 1, it showed that the countries where lovebirds

had a large market. These countries were California, Canada, Chicago, China,

Colorado, Dubai, Hongkong, Indonesia, Japan, New Jersey, Singapore, Taiwan,

Thailand and United Kingdom. However, among these countries, only in China

had a bigger market in order to sell lovebirds.

Projected Demand and Supply

In computing the demand and supply every year, add all the lovebirds of

every vendors interviewed then multiply by two since the quantity indicated in the

table is by pair then multiply by 52 which is the number of weeks every year

since the indicated demand and supply of every vendor is every week. Through

this demand and supply of every year will be computed.

For Year 2011 (demand): ((14+10+14+10+8+10+18) x 2) x 2) = 8736

For the growth rate, we compute the growth rate of every vendor then get the

sum of it then divide by seven (the number of vendors interviewed) to get the

average growth rate. The average growth rate of .41 and .31 are used for the

projection of demand and supply, respectively.

Domestic

Demand Supply

Unfilled

Demand Percentage

Quantity Per

Year

HISTORICAL

2011 8736 4992 3744

2012 8772 5007 3764

2013 8808 5023 3785

2014 8844 5039 3805 16% 609

2015 8880 5054 3826 18% 689

2016 8917 5070 3847 20% 769

2017 8953 5086 3868 22% 851

2018 8990 5101 3888 24% 933

2019 9027 5117 3910 26% 1016

33

2020 9064 5133 3931 28% 1101

2021 9101 5149 3952 30% 1186

2022 9138 5165 3973 32% 1271

2023 9176 5181 3995 34% 1358

The computation of demand and supply as well as the growth rate of

domestic and export have the same computation of growth rate.

Export

Demand Supply

Unfilled

Demand Percentage

Quantity

Per Year

HISTORICAL

2011 3952 1872 2080

2012 3972 1877 2094

2013 3992 1883 2109

2014 4012 1888 2123 18% 382

2015 4032 1894 2138 20% 428

2016 4052 1899 2152 22% 474

2017 4072 1905 2167 24% 520

2018 4092 1910 2182 26% 567

2019 4113 1916 2197 28% 615

2020 4133 1921 2212 30% 664

2021 4154 1927 2227 32% 713

2022 4175 1933 2242 34% 762

2023 4196 1938 2258 36% 813

34

CHAPTER II

Technical Aspect

This chapter deals with the methodological phase that will give people

understanding about the exportation and domestic selling of love birds as well as

the shipping services, requirements from different government agencies and the

breeding process.

A. Description of the Product

Love & Pair Co. is a partnership business with a purpose of selling

lovebirds within and outside the Philippines. It offers many breeds of lovebirds

such as Fischer’s, Peached face, Black Masked and Nyasa Lovebirds for various

choices of customers. Love & Pair Co. has the potential to compete with other

sellers of love birds and pet shops because the

facility will not only include a store but also a

capacity for breeding and an aviary to ensure

the good quality of the love birds. Love birds

are to be sold in the international (Southeast

Asian Countries) market as export products.

Additionally, Love & Pair Co will cater the

domestic market by being a supplier to pet

shops within the vicinity and also selling to

walk-in customers.

Lovebird is a small breed type parrot. It

has its original birthplace in Africa and can be

divided into 9 types. It is a charming and

playful bird. It lives with its couple. There are a lot of colors in lovebird. With the

original color of green, lovebird colors have been developed to a variety colors by

human. Until now, violet color lovebird has existed. Lovebird has average age of

15 to 20 years and it can be breed throughout the year.

35

According to Wikipedia, they belong to one of the nine species of the genus

Agapornis, a Greek term which means “agape for love and ornis for bird”. They

are a social and affectionate small parrot. Seven species are native to the African

continent, while the Grey-headed Lovebird is native to Madagascar. Their name

stems from the parrots' strong, monogamous pair bonding and the long periods

which paired birds spend sitting together.

Lovebirds are 13 to 17 centimetres in length and 40 to 60 grams in weight.

They are among the smallest parrots, characterized by a stocky build, a short

blunt tail, and a relatively large, sharp beak. Wild type lovebirds are mostly green

with a variety of colors on their upper body, depending on the species. The

Fischer's Lovebird, Black-cheeked Lovebird, and the Masked Lovebird have a

prominent white ring around their eyes. The Abyssinian Lovebird, the

Madagascar Lovebird. Many color mutant varieties have been produced by

selective breeding of the species that are popular in aviculture.

All species are native to Africa; eight species live on continental Africa

while one, the Grey-headed Lovebird, inhabits Madagascar off the African east-

coast. This is a very good reason why African lovebirds adapt well in tropical

countries like the Philippines. In the wild the different species are separated

geographically. They live in small flocks and eat mainly fruits, vegetables, some

grasses and seed.

B. Classification of Love & Pair Co.’s Lovebirds

In this chart, it shows the product lines of Love & Pair Co. Lovebirds are

divided into two main classifications: eye ring and non-eye ring. Under each

categorization is divided into four (4) categories which pertain to the ages of

every lovebird. Under this, there are four species of lovebirds. And then, each

species are classified into many colors as shown below. Through this

classification, prices of every lovebird are determined.

36

Lovebirds

Fischer's Lovebird

Normal (Pure)

Normal (Split)

Blue, Light Blue, White,Dilute Jade, Dilute Olive

Violet

Peachfaced Lovebird

Normal (Pure)

Black Masked Lovebird

Normal (Split), Blues

Opalines, various colours from

Silver Cherry, Red Eyed Yellow

Other Colors

Nyasa Lovebird

Normal

Eyering

Egg

Young

Breeder

Adult

Non-eyering

Egg

Young

Breeder

Adult

African Lovebirds

Lovebird Species and Mutations

A. The White Eye Ring Group

1. Black Masked Lovebirds

The Black Masked has many mutations including violet, lutinos, albinos

and pieds, the parYellow and parWhite are are much more rare. They

have a red beak, yellow collar, green body, bluish rump, and black and red

band on the tail. Length: 6-6 inches

2. Fischer's Lovebirds

Normal Fischer's have an orange face and throat, red forehead, red beak,

green body, and green tail with blue tips. There are also blue, yellow,

37

seagreen, lutino, pied, and spangle mutations.

Length: 4 inches

3. Black-Cheeked Lovebirds

The overall colour of these birds is green, with brown/black cheeks and

forehead. The back of the head is yellow/green, and the throat is orange.

They have a red beak, and green body. While no color mutations are

known, many of these birds have been hybridized with Maskeds, Nyasas,

and Fischer's.

Length: 4 inches

4. Nyasa Lovebirds

Mainly green birds, with a red beak, red forehead, and orange/red throat

and cheeks. The tail has a dark band near the tip. There is a Lutino

mutation of the Nyasa Lovebird, which has a red head and yellow body.

These Lutinos are smaller in size.

Length: 4 inches

The Intermediate group

1. Peach-Face Lovebirds

The normal Peach-Face is primarily green, with a red face and throat and

horn colored beak. They have blue rumps and a green tail with some

black, rust, and red colors in it. There are more than 75 mutations of the

Peach-Face. The most popular being the Lutinos with the same red head

face, but with a yellow body, and the Blues who have a pale blue body

and a softer peach colored face.

Length: 6-7 inches

38

C. Growth Development of Lovebirds

Age Description Period of Time

Egg Laying and Incubation

Time

31 days = 1 month old

Chicks After hatching of the egg

and development of the

bird

36 Days = 1.2 months;

44 days before leaving

the nest = 1.47 months

Young From the day the lovebird

if fully formed

2 months old

Breeder The lovebird will start to

mate and reproduce

10 months old

Adult The lovebird does not lay

eggs anymore

5 – 10 years old

D. Description of the selected manufacturing process

A. Process of Breeding

Breeding/Reproduction

For breeding lovebirds, each

pair of birds has 2 nest boxes for

sleeping and nesting. These boxes

are at the same type and size, and

placed at the same height on the

same wall. Lovebirds breed

willingly as single pairs and some

species of lovebirds can bred in a

colony setting.

Breeding Age for Lovebirds

39

Lovebirds are at least 10 months old, though 12 to 13 months is

better. Also birds that are 5 to 6 years or older are retired from breeding.

Sexing Lovebirds

Visual characteristics are needed to determine in order to know

the sexes of the lovebirds. A female’s tail appears squarer while males

appear more rounded. The female will do most of the nest building work.

An anal inspection is done but takes experience in sexing these birds to

make a fair determination.

Egg Laying and Hatchlings

The female will lay about 5 eggs, though the clutch could be as few

as 3 eggs or as many as 8 eggs. The incubation period is 22 - 25 days,

with 75% to 80% of the eggs hatching. The hen will start to brood after the

second egg is hatched. Often the male will join the hen in the nest. The

chicks will begin to leave the nest in about 38 - 50 days and will be

independent about 2 weeks after leaving the nest.

Incubation Time

On average, Lovebirds incubate their eggs for about 23 days. This

can vary by a couple of days in either direction. For calculation of future

hatch dates, Love & pair Co. always count forward from the day the hen

begin to sit on the eggs.

Hatchling Care and Weaning

Love & Pair Co. allows the hen to feed the babies from hatching to

the age of 2 or 3 weeks. From there, they will pull the babies out of the

nest and place them in a brooder for hand feeding. Most Lovebirds need

to be handfed until they are between 6 and 8 weeks old.

B. Selling Lovebirds (Within the Philippines)

40

Love and Pair Co. will sell lovebirds through a pet shop located along

McArthur Highway in Potrero, Malabon City. It will accept walk-in customers and

enthusiast breeders within Metro Manila. It will offer many types of lovebirds that

they could choose in the aviary. Also, it offers bird accessories, bird foods and

maintenance materials for birds. Love and Pair Co will also distribute lovebirds to

other places in the National Capital Region.

C. Selling Lovebirds (Outside the Philippines)

Love and Pair Co will export lovebirds to their target customer from China.

Love and Pair Co. will establish a website that will serve as a medium to the

foreign customers. Through online, customers will choose their lovebirds and will

order in bulk. There will be middleman to assists Love & Pair Co. in transacting

exports. Complete shipping requirements will be submitted then the lovebirds

will be delivered in the said country.

These are the agencies that are concerned regarding the exportation of

live animals like lovebirds.

LOGO NAME

Bureau of Animal Industry is the agency that

provides Import - Export procedures for

much different kind of living animals. They

provide the permits and legal papers for the

approval of selling lovebirds outside the

country.

Philippines Pet Passport & Quarantine

Information - Pet immigration rules are

specific to each country worldwide, and pet

owners/sellers/breeders need to be familiar

with these rules before traveling/selling to

avoid pet quarantine in countries that

require it.

41

Pet Passport

The Pet Travel Scheme ("PETS") is a

system which allows animals to travel easily

between member countries without

undergoing quarantine. A Pet Passport is a

document that officially records information

related to a specific animal, as part of that

procedure.

Philippines Customs, Currency & Airport

Tax regulations details - Pets may enter as

passenger's checked baggage

REQUIREMENTS:

One-Stop Export

Documentation Center

The One Stop Export Documentation Center (OSEDC) houses under one roof

different government agencies that handle the processing of Export

Declaration/Authority to Load, Commodity Clearances/Certificates and Certificate

of Origin. These are:

Bureau of Animal Industry (BAI);

Bureau of Customs (BOC);

DENR-Protected Areas and Wildlife Bureau (DENR-PAWB)

Department of Environment and Natural Resources – NCR Office

I. Bureau of Animal Industry (BAI)

A. Quarantine/Veterinary Certificate – document issued by Bureau of Animal

Industry, Department of Agriculture (BAI-DA) for animals certifying that these are

free from evidence of dangerous communicable animal diseases or exposure

thereto.

42

Requirements for Pet Export from the Philippines

This may also be applicable for local air travel in the Philippines.

Information required in applying for an Export Permit from BAI (Bureau of

Animal Industry)

- Name of Pet

- Breed

- Sex

- Age

- Color

- Weight

- Species

Documents required supporting the above application:

1. Vaccination Record – containing details of the vaccines administered

and date of vaccination.

2. Health Certificates issued from a licensed veterinarian – issued within

10 days of the travel date and should state that the animal has been

examined and free from any communicable disease.

(A 2-sheet (1 original pink copy and 1 duplicate) veterinary health

certificate (Export Certificate) will be issued by BAI. No fees were

collected from acquiring the Export Certificate. Upon arrival at NAIA

(Ninoy Aquino International Airport), report to the quarantine desk and the

officer will get the copy and issue you another travel permit upon payment

of 100PHP.)

43

II. Bureau of Custom

Export Transactions

1. Processing of Export Declaration and Issuance of Certificate of

Identification

2. Issuance of Certificate of Origin with Pre-exportation Evaluation of

Goods

3. Processing of Certificate of Origin

4. Issuance of Certificate of Shipment

III. DENR-Protected Areas and Wildlife Bureau (PAWB)

A. CITES Export Permit – permit authorizing an individual to bring, send, or

transport wildlife listed under CITES Appendices, including its by-products or

derivatives, from the Philippines to other countries.

B. Non-CITES Export Permit – permit authorizing an individual to bring out non-

CITES wildlife from Philippines to any other country.

C. Re-issuance Fee – payment made for processing and issuing the same

document for replacement of expired CITES/non-CITES permit.

D. Wildlife Farm Permit – permit to develop, operate and maintain a wildlife

breeding farm for conservation, trade and/or scientific purposes.

E. Large-scale Farming - commercial breeding/propagation of wildlife with capital

of more than Php 1,500,000.

IV. Department of Environment and Natural Resources (DENR) – National

Capital Region (NCR) Office

Since Love and Pair Co. office and bird farm is location within National

Capital Region, the permit from the Department of Environment and Natural

Resources of selling and breeding lovebirds will be released for the DENR-NCR

Office.

Costing of Permit

Certificate of Wildlife Registration 1000.00

Wildlife Local Transport Permit (LTP) 100.00

44

Processing Fee 100.00

Wildlife Export Certification (WEC) 200.00

Certification of Export Permit 200.00

Exportation Fee (3% of Value of Product)

Inspection Fee 300.00

Travel Permit 100.00

Shipping Policy of Love & Pair Co.

Deposit and Payments

1. Deposit of 50%should be received within 7 working days upon agreement to

purchase.

2. Full payment of balance should be received 14 days before the schedule

delivery. If payments of balance and arrangements for shipping delivery have not

been made by the purchaser within that period, Love & Pair Co. reserves the

right to cancel the order.

3. Payment is through telegraphic transfer only in US Dollar.

Telegraphic Transfer

A telegraphic transfer represents the fastest, most secure and inexpensive

method of transferring funds internationally, especially when denominated in the

beneficiary's local currency. Love & Pair Co. will coordinate with Society for

Worldwide Interbank Financial Telecommunication (S.W.I.F.T), a member-owned

cooperative through which the financial world conducts its business operations

with speed, certainty and confidence. This will serve as the main currencies

direct telegraphic transfer in connection with BDO here in the Philippines.

45

The following bank details.

Account Name: Love & Pair Co.

Bank: Banco de Oro (BDO)

Branch: Banco De Oro (BDO) in Malabon City

Address: 110 MacArthur Highway corner Riverside Street, Potrero Malabon City,

Metro Manila

Phone No.: +63 52 481 4482 / +63 52 481 4481

US $ Account No.: 181003863

SWIFT Code: DNORTHMM

Health Guaranty

1. Love and Pair Co. does guarantee all our birds to be free of pathogenic

bacteria, viral and congenital defects. Birds coming with 3 day guarantee from

day of shipment. If a health concern should arise after arrival, notification within

24 hours of any signs and symptoms and the birds should be seen by an avian

veterinarian to perform a health examination within the same time frame. If there

is health problems determine that cannot be cured or cost prohibitive, at Love &

Pair Co. discretion, we will refund the money. We do reserve the right to get a

second opinion at our expense.

2. If a bird should die, it must be examined by an avian veterinarian for necropsy

and histology within 24 hours of death. Love & Pair Co. are not responsible for

airfreight charges nor do veterinary charges after birds leave our facility.

3. Birds are not returnable except under these conditions set out in this health

guarantee. Any purchase of any of our birds indicates acceptance of this

guarantee.

46

Love & Pair Co. Terms and Conditions

Prices

Prices excludes freight charges, CITES and Veterinary charges subject to

change, subject to devaluation and that the birds are unsold.

Packing

All our boxes are made according to International Air Transport Association

(IATA)rules.

Payment

Payment has to take place in advance via Telegraphic Transfer 50% within 7

days upon agreement to purchase with telephone confirmation to our banker.

Bank Account Details:

Account Name: Love & Pair Co.

Bank: Banco De Oro (BDO)

Branch: Banco De Oro (BDO) in Malabon City, Metro Manila

Address: 110 MacArthur Highway corner Riverside Street,

PotreroMalabon City, Metro Manila

Phone No.: +63 52 481 4482 / +63 52 481 4481

US $ Account No.: 181003863

SWIFT Code: DNORTHMM

Delivery Time

The delivery is within 2~3 weeks upon receipt of balance payment. Will depend

on how fast CITES/PERMITS are released.

47

Month Quantity (Per Piece) Age of Lovebirds Number of Lovebirds DescriptionJanuary 600 Breeder

February Lovebirds will look for their partners.March April 280 Eggs 140 (B), 280 ( E ) This month lovebirds will start to lay their eggs.May 280 Chicks 140 (B), 280 ( C ) The eggs will be cracked and turn into chicks.June 280 Eggs 140 (B), 280 ( E ), 280 ( C ) Second hatchling of lovebirdsJuly 280 Chicks 140 (B), 280 ( C ), 280 (Y)

280 YoungAugust 280 Eggs 140 (B), 280 ( C ), 280 (Y) 280 (E ) Third hatchling of lovebirds.

September 280 Chicks 140 (B), 280 ( C ), 560 (Y) 280 Young

October 280 Eggs 140 (B), 280 (C ), 560 (Y), 280 (E ) Fourth hatchling of lovebirdsNovember 280 Chicks 140 (B), 280 (C ), 840 (Y)

280 YoungDecember 280 Eggs 140 (B), 280 (C ), 840 (Y), 280 (E ) Fifth hatchling of lovebirds

Love and Pair Co. will buy 300 pairs of lovebirds. 140 forbreeding purposes and 460 for selling purposes.

Third batch of eggs will turn into chicks as well as the third batch of chicks into young.

The second batch of eggs will crack. Lovebirds turn into young.

Fourth batch of eggs will turn into chicks as well as the fourth batch of chicks into young.

Guarantee

Love & Pair Co. guarantees shipment is alive at airport of destination if you

collect the consignment within one (1) hour upon arrival of the plane. If it is

collected later from the airport, our guarantee is over. Same as transport from

airport to destination to your farm is your own responsibility.

Claims

If any of the birds die en route, it should be accompanied by a damage report

from the carrier signed by Ninoy Aquino International Airport (NAIA). Consignee

should notify Love & pair Co. within 4 hours upon arrival, via email/fax about the

damage, at the airport of destination. A colored photo should also accompany

said report.

D. Determination of the size and production schedule

Love and Pair will start breeding using 300 pairs of different breeds of

lovebirds. 230 pairs will be sold and 70 pairs will be used as breeders.

Table 1.1

48

Table 1.2

The table above explains the meaning of every letter on Table 1.1 as well as the

total number of lovebirds for the first year which will be the basis on the

succeeding years.

E. Selection of machinery, equipment, furniture and fixtures

1) Housing of Lovebirds

Age Number of Lovebirds Cage Size

Breeder 2 – 4 81 x 50 x 50 cm

Young, Chicks, Adult 5 – 10 183 x 183 x 91 cm

Lovebirds need a cage which has at least two places to perch, with room

to fly from one to the other. When they already a breeder, in every cage there

will be minimum of two lovebirds per cage and a maximum of four lovebirds.

These cages are for breeders. When are already adult, they are transferred for

display in the pet shop, which is a flight cage.

Perches have a size that is appropriate for the love birds for them to move

from one to another. It is convenient to have two sets of food and water dishes so

that they can be alternated and washed each day. Water must be changed and

the dish washed every day. Food dishes can stay longer, with food added each

day if preferred, but food dishes do need to be completely emptied, washed, and

refilled at least once a week. Lovebirds need activity in the cage to stay healthy.

Swings, ladders, and interlocked bamboo rings are favourite’s.

49

Total: (First Year)E eggs 280C chicks 280Y young 840B breeder 140A adult NA

Legend:

Bird Size Age Bar Spacing of Cage (inch) Perch Diameter (inch)

Chicks & Young 2 months-old Lovebirds No more than 1/2" 3/8" to 3/4"

Breeder 1 - 3 years old lovebirds 1/2" to no more than 3/4" 5/8" to 1-1/4"

Adult 4 – 10 years old lovebirds 3/4" to no more than

1-1/4"

1" to 2"

Table 1.3 Size of Bar and Perch for the Cage

Quantity Picture Price Amount

200

Cage

Php

1,000.00

Php 200,000.00

400 Php 45 Php18,000.00

50

BIRD PERCH

200

Nest box

Php 60 Php12,000.00

200

Water container

Php 15 Php 3,000.00

200

Food container

Php 15 Php 3,000.00

TOTAL: Php 236,000.00

51

2) Care and Feeding

In the wild, lovebirds feed on seeds, berries, fruits, grains, grasses, leaf buds,

and agricultural crops of corn, maize and figs. Their food and water dishes are

best if earthenware or porcelain as they will get gnawed if plastic.

A. Bird Food

Foods available for Lovebirds include formulated diets, either pelleted or

extruded, seed only diets, and small parrot mixes which offer a mixture of both.

- Formulated Diet:

A formulated diet provides a good nutritional base so does not

require the addition of vitamins. Phytonutrients are believed to boost the

immune system, help a body to heal itself, and to prevent some diseases.

- Seed Diet:

A seed only diet offers much more variety but requires additional

vitamin and calcium supplements.

B. Bird Supplements

Supplements include fresh vegetables, greens, and tree branches

for the bark, some fruits, and millet spray. Some of the fruit supplements

include berries, apples, grapes, pears, bananas, and kiwi. Some of the

greens and vegetable supplements include spinach, endive, watercress,

chickweed, radish, parsley, dandelions, carrot tops, corn on the cob, peas,

endive, field lettuce, and various garden herbs. Additional proteins can

be offered such as nuts. Vitamins can be added to the food or drinking

water.

C. Water

Lovebirds drink a lot of water, so will need fresh drinking water

every day.

D. Bird Baths

Most lovebirds love a bath either in a flat earthenware dish or by

spraying them with a light mist of lukewarm water. If you use a bathing

52

dish, you will see the birds perch on the edge and dip their heads and

upper bodies in the water and beating their wings. They prefer this kind of

bath to getting into the water.

E. Bird Grooming

Lovebirds generally maintain their nails and beaks on their own

through climbing and chewing. Another good use they make of their tree

branches.

Quantity Picture Price Amount

4 Pack

(Good for

a one

month)

sunflower seeds

Php250.00 Php 1,000.00

4 Pack

(Good for

a one

month)

Bird seeds

Php 235.00 Php 940.00

53

4 Pack

(Good for

a one

month)

Canary seed

Php 279.00 Php 1,116.00

200

Cuttle bone

Php 90.00 Php 1,800.00

4 Sacks

Wood shavings

Php 100.00 Php 400.00

Total Php 6,292.00

54

3) Office Equipment

Qty. Picture Product Price Total

1 Desktop

Computer is

used for

keeping files

and records

such as

breeding,

customer

orders and

other

important

files.

Php

23,285.5

0

Php

23,285.50

1 Printer

This would

be placed

along with

the desktop

computers to

convert an

electronic

version of

document to

its printed

form.

Php

3,599.00

Php

3,599.00

55

1 Scanner

This would

be used to

convert a

printed

document to

its electronic

form.

Php

4,198.50

Php

4,198.50

1 Fax machine

This would

be used to

send and

receive

documents

over a

telephone

line.

Php

4,790.00

Php

4,790.00

2 Television

This would

be placed at

the pet shop

for

entertainment

purposes of

the

customers.

Another will

be placed in

the office to

monitor the

pet shop

25,000.0

0

50,000.00

56

through a

CCTV

Camera.

2 Closed-circuit

television

camera

This will

monitor the

pet shop, the

breeding

room and

stock room.

Php

12,700.0

0

Php

25,400

1 Cashier

Counter

For receiving

the order and

payment of

the lovebirds.

Php

20,000.0

0

Php

20,000.00

Total: Php

131,273.00

57

4) Furniture & Fixtures

Qty. Picture Product Price Total

2 Sofa bed

This would be

placed at the

pet shop for

receiving area

for the

customers.

Another two in

the office for

relaxation

purposes.

Php

6,500.0

0

Php 13,000.00

1 Office table

This would be

used in the pet

shop, office

and breeding

room.

Php

5,490.0

0

Php

5.490.00

2 Office chair

This would be

used in the

office.

Php

4,100.0

0

Php

8,200.00

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1 Computer

chair

This would be

placed at each

computer

desktop.

Php

500.00

Php

500.00

4 Whiteboards

This will serve

as the manual

record in the

breeding room

to monitor the

lovebirds’

hatching of

eggs.

Php

3,200.0

0

Php

12,800.00

1 Washroom

fixtures

These would

be used for

the sanitary

needs of the

people inside

the premises.

Php

38,107.

00

Php

38,107.00

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2 Air

conditioning

unit

This would

serve as

ventilation

purposes in

the pet shop

and office.

Php

14,200.

00

Php

28,400.00

TOTAL Php

106,497.00

5) Tools

Quantity Picture Product Price Total

18 Fluorescent

Light

This would be

used for

lighting

purposes of

the rooms and

the whole

building.

Php

124.00

Php

2,232.00

3 Fire

extinguisher

This would be

used as

protection to

small fires

during

Php

1,380.0

0

Php 4,140.00

60

emergency

situations.

3 Fire alarm

This would be

placed along

the halls of the

school to

detect

unwanted

presence of

fire.

Php

1,300.0

0

Php 3,900.00

Total: Php 10, 272.00

6) Delivery Equipment

Quantity Picture Product Price

1 Delivery Truck

This will be used for

delivering birds to our

sellers as well as going to

airports for exportation.

Php 695,00.00

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F. Identification of plant location

Love and Pair Co. will rent a building for its pet shop and breeding center. It I

located at #38 Potrero, Malabon City along McArthur Highway. The rent will cost

Php 70,000 per month excluding electrical and water bills. It is a two-storey

commercial building. Each floor measures 120 square meters. It requires two

month deposits, two months advance and a lease contract.

Project Engineering

After identifying the possible and suitable location for the project’s site, the

next thing to be done is to create a design of the pet shop layout for renovation

purposes.

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Floor Plan Design

This will be the design of Love and Pair Co. Pet shop. The first floor will

serve as the shop where customers will be accomodated by the staffs. On the

second floor, office, stock room and the breeding room can be found.

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.

This will be the replica of the arrangement of the cages on the second floor of the

Love & Pair Co. Building

G. Production Scheme

There will be 300 pairs of lovebird breeders that will breed in an aviary

located at McArthur Highway. At the second floor of the Love and Pair Co Pet

shop, there will be the breeding place of the lovebirds. Domestically, the pet shop

will sell 230 lovebirds. Customers may choose from those love birds.

Internationally, Love and Pair Co will export birds depending upon the demand of

the targeted customers outside the country.

H. Study of the availability of raw materials, utilities and labor requirements

The project has available materials in the form of love birds accessories,

maintenance and food supplies. These consist of cages, perches, food dishes,

maintenance, etc. These are obtained from JBlaza Lovebird and Pet Supplies

located at J. P. Rizal Street, Marikina City 1800, Philippines. This will be the main

supplier of Love and Pair Co for all the needs of the lovebirds. Weekly purchases

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of food-for-one-week supplies will be done to ensure the proper diet of the

lovebirds. Also, lovebirds will be given a monthly check-up to ensure their health.

Utilities include services to provide for water supply, electricity, sanitation, and

maintenance. The water supply will be primarily run by the Maynilad Water

Supply. MERALCO will be the trusted electricity provider of Love and Pair Co.

Pet Shop for proper ventilation and lightning in the pet shop as well as the

breeding room of love birds. Sanitations and cleanliness of the Love and pair Co.

Pet Shop’s facilities will be entrusted on the utilities personnel employed through

different agencies. Daily clean-up and weekly general cleaning will be executed

also so that cages will be properly maintained. Cleanliness of the cages will

ensure the lovebirds to be protected from any illness. This will also prevent any

unpleasant odor that could possibly arise if it not cleans properly.

Labor force of Love and pair Co. Pet Shop will be composed of the

employees who will be in the shop that will entertain the needs of the customers.

These employees undergo the process of recruitment to ensure that only

qualified personnel will comprise the organization. Also, Love and Pair Co. will

hire employees who are knowledgeable enough in taking care of lovebirds and

they will be assigned in the Breeding room. In addition, Love and pair Co. will

hire a veterinarian to check the lovebirds and maintain their healthy living.

I. Determination of type and quantity of waste to be disposed

Love and Pair Co. will maintain the cleanliness of its pet shop to avoid

having problems regarding waste disposal and also to attract customers. There

will be segregation process when it comes to garbage. Utilities personnel will be

the responsible for handling, processing and disposing all types of wastes on a

daily and weekly basis.

Biodegradable

Bird Food

Bird faeces

Rotten eggs

Non-biodegradable

Sacks

Plastics

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Chapter III

Management Aspect

This involves the determination of the form of ownership to be adapted, the

management procedure in the day-to-day operations, and the qualifications,

duties, and responsibilities of the employees, the organizational chart, and the

required documents to be submitted. It explains the pre-operating actions of the

business of the company.

Mission

The company endeavours to be acknowledged in the national and

international market, specifically Southeast Asian Countries as a highly regarded

source of a wide selection of good variety and quality lovebirds. The company

aspires to be involved in the endorsement of the sustainable progress of lovebird

species by adopting ethical breeding practices, and supporting its preservation

both in their captive and natural environments.

Vision

Cognizant of the challenges of the rapidly developing digital age, Love &

Pair Co. envisions to eventually be a One-Stop Bird Shop in the vast global

market with the upgrade of the company's telecommunications technology,

thereby making web-based viewing and purchasing of bird variety fast and easily

accessible.

Business Logo

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Love & Pair Co. is a pet shop with specialization for lovebirds only. Lovebirds are

known to be partners and they will die if they will have no companion. Because of

this, the partners decided to name the business Love & Pair Co.

Form of Ownership

Love & Pair Company will be established as a general partnership type of

merchandising business. The chosen business type is merchandising since the

business is involved in selling lovebirds inside and outside the country. The

company endeavours to be acknowledged in the national and international

market, specifically Southeast Asian Countries, as a highly regarded source of a

wide selection of good variety and quality lovebirds.

There will be five capitalists consist of the following persons:

NAME NATIONALITY RESIDENCE

Castillo, Jophet M. Filipino Caloocan City

Cañas, Arbiegail D. Filipino Marilao, Bulacan

Indiongco, Mark Harold V. Filipino Caloocan City

Naranjo, Pauline Mae L. Filipino Valenzuela City

Tumalad, KlevinEmilor E. Filipino Caloocan City

Each of them has an extensive knowledge in supervision of the day-to-day

and business operation. The main goal of this formation of ownership is to earn

money from selling domestically and among Southeast Asian Countries. Profits

will be shared by the partners equally as a form of return of their contribution.

Earnings of the corporation are taxed with accordance of Tax Laws and

Regulations.

Capitalization

The Love & Pair Co. will have a total contribution of Php 2,000,000 as

contributed by the following:

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Pre-operating Activities

In relation to the formulation of the partnership, legal processes are needed to

be followed with strict conformity in local government units and government

agencies. All the necessary requirements must be approved before the

organization can be put up. These are the basic requisites in opening up the

Love & Pair Co.:

SEC Registration

Articles of Partnership

Barangay Clearance

Community Tax Certificate (Cedula)

Photocopy of Original Transfer Certificate of Title/ Photocopy of Contact of

Lease

Picture of Establishment with sketch of location

o Outside view with Signboard

o Inside view

Agencies concerned:

1. Securities and Exchange Commission- Its major functions included

registration of securities, analysis of every registered security, evaluation of

the financial condition and operations of applicants for security issue.

Basic Requirements

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NAME CONTRIBUTION

Castillo, Jophet M. Php 400,000.00

Cañas, Arbiegail D. Php 400,000.00

Indiongco, Mark Harold V. Php 400,000.00

Naranjo, Pauline Mae L. Php 400,000.00

Tumalad, KlevinEmilor E. Php 400,000.00

1. Name Verification Slip;

2. Articles of Partnership; and

3. Joint affidavit of two partners undertaking to change partnership name,

provided in its Articles of Partnership or as amended thereafter, immediately

upon receipt of notice or directive from the Securities and Exchange

Commission that another corporation, partnership, or person has acquired a

prior right to the use of that name or that name has been declared

misleading, deceptive, confusingly, similar to a registered name, or contrary

to public morals, good customs, or public policy (not required if Articles of

Partnership has provision on this commitment).

Additional requirements 

1. Endorsement/clearance from other government agencies, if applicable

2. For partnership with  foreign partners

a)   SEC Form No. F- 105

b)   Bank certificate on the capital contribution of the partners

c)   For foreign partners who want to register their investments with the

BSP:  Proof of remittance

         Note: If it is a limited partnership, the word “Limited” or “Ltd” should be

added to the partnership name.  Articles of Partnership of limited

partnerships should be under oath only (Jurat) and not acknowledged before

a notary public.

SEC

Reservation of the Partnership Name P 120.00

Articles of Partnership 5,000.00

Legal Research Fee 100.00

Total P 5,220.00

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2. Local Government Units - Love and Pair Co. must get requirements for its

city of operations from different local government units. The needed papers in

putting up a business are:

Business Permits

Community Tax P 3,500.00

Barangay Clearance 500.00

Business Tax 156.25

Mayor's Permit Fee 600.00

Business Plate/Sticker 200.00

Refuse Fee 1,528.00

Garbage Fee 1,500.00

Sanitary Permit 1,000.00

Health Certificate Fee 100.00

Building Inspection Fee 400.00

Electrical Inspection Fee 400.00

Plumbing Inspection Fee 400.00

Billboard/Signboard Inspection Fee 200.00

Fire Safety Inspection Fee 24.00

Filling Fee 100.00

Processing Fee 18.00

Zoning and Land Use Verification Fees 400.00

Locational Clearance Fee 4,460.00

Mayor's Certificate 50.00

Total P 25,386.25

BIR

Registration Fee P 500.00

Certification Fee 100.00

Documentary Stamp 15.00

Print Receipts and Invoices 3,500.00

Total P 4,115.00

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4. Department of Trade and Industry – Love & Pair Co. must register with the

agency in order to legalize all the transactions involved in the conduct of its

business in local and international market. Also, this would help for the

diversification of Philippine trade both in domestic and foreign.

DTI

Basic Application Fee P 500.00

Documentary Stamps 15.00

Total P 515.00

5. Social Security System, Home Development Mutual Fund (Pag-Ibig),

PhilHealth- Love & Pair Co. must secure an employer number in every

agency as a reference of their monthly contributions. There are requirements

that Love & Pair Co. needs to have for the registration of the

employer/company:

Each Agency:

SEC Registration

Initial Mayor’s Permit

SSS

a. Employer registration form (Form R-1);

b. Employment report (Form R-1A);

c. List of employees, specifying their birth dates, positions, monthly

salary and date of employment; and

d. Articles of incorporation, by-laws and SEC registration.

PhilHealth

a. Employer data record (Form ER1);

b. Report of employee-members (Form ER2);

c. SEC registration;

d. BIR registration; and

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e. Copy of business permit.

Pag-Ibig

a. Employer’s Data Form (EDF)

b. Member’s Data Form (MDF)

6. Agencies about Animal Protection and Exportation

Exportation needs a lot of legal papers to be able to have transaction

especially Love & Pair Co. is selling live animals. The following agencies will

provide various permits regarding exporting lovebirds, procedures in proper

shipment of lovebirds and lastly, the protection of the lovebirds.

a. Bureau of Animal Industry is in-charge of the Import - Export procedures

for many differentkind of living animals, specifically lovebirds.

b. Philippines Pet Passport & Quarantine Information – The agency that will

provide papers regarding approval of selling lovebirds outside the

Philippines regards to the health condition of the lovebirds.

c. Pet Passport - The Pet Travel Scheme ("PETS") is a system which allows

animals to travel easily between member countries without undergoing

quarantine. A Pet Passport is a document that officially records

information related to a specific animal, as part of that procedure.

d. International Airport Travelling Association – the agency that take in-

charge of Philippines Customs, Currency & Airport Tax regulations.

e. PetRelocation.com – The agency that manages about how the lovebirds

will be delivered to the customers of Love & Pair Co. It depends on the

shipping that will be negotiated.

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f. Jet pets Animal Transport - The trusted Pet Travel Experts (Same with

PetRelocation.com)

Project Schedule

These are the activities of the business with their respective time

allocation starting from the month of September 2013 up to the start of the

operation:

Feasibility Planning

Time Span: One month (September 2013)

The first month is the feasibility planning phase. It determines the demand

and supply for the lovebirds, the target market and potential competitors of the

business. In this phase, forecasting and assumptions regarding the business are

planned in order to have clear preview of what will happen in the business.

Contribution of capital by the partners

Time span: Two weeks (First two weeks of October 2013)

The partners contributed Php 500,000 each as the initial capital of the

partnership to finance all the pre-operating activities. These activities include the

rent of the building, renovation of the building, registration fees, instalment of

utilities and other expenses.

Finding a premeditated location

Time span: Two weeks (First two weeks of October 2013)

73

To be able to have this business, there must be a strategic location. The

partners chose a place where it is accessible and easily to be seen by the

prospect customers.Love and Pair Co. rents a building located at #38 McArthur

Highway, Potrero, Malabon City. It is a two storey building with the area of

approximately120 square meters in each floor and it costs Php 70,000 a month

excluding electricity and water bills.

Registration and completing required business permits and licenses

Time span: One month (Last two weeks of October to first two weeks of

November 2013)

These consist the following steps:

1. SEC registration of name and incorporation of the business.

2. Securing business permits and license to operate from the office of the

mayor.

3. Getting Barangay Clearance from the office of the barangay chairman

where the business will be located.

4. Registration of the business with the BIR, Philhealth, SSS and Home

Development Mutual Fund.

Building Improvements

Time span: One month and two weeks (November 2013 to first two weeks

of December)

The building will undergo improvement to accommodate the services that

will be offered by the business. It will be composed of a pet shop on the first floor

and a breeding room, office and a stock room on the second floor. Renovations

are needed in order to attract future clients of the business.

Acquisition of furniture and fixtures

74

Time span: One month and two weeks (November 2013 to first two weeks

of December)

The acquisition of furniture and fixtures will be made during the building

renovations. These are selected to suit the facilities of the pet shop. The

acquisition of these furniture and fixtures are based on the needs of the pet shop

and the breeding centre of Love and Pair Co. All selected furniture and fixtures

are chosen by means of its usefulness as well as the price of it.

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Hiring of Employees

Time span: One Week (Third Week of December 2013)

Employees are important in the business because they will serve the man

power. The hiring will be administered by the partners. Stated job qualifications

should be met by the applicants to know if they are capable of the job that will be

given. They will be informed as well of their duties and responsibilities to the pet

shop as well as taking care the love birds in the breeding area.

Start of Operation

Time span: First week of January 2014, onwards

The Love & Pair Company will commence its operation after almost five

month.

GANTT CHART

Activities 2013 2014

Sept Oct Nov Dec Jan

Feasibility study

planning

Contribution of capital

by partners

76

Finding strategic

location

Registration and

completing required

business permit and

licenses

Building improvements

Acquisition of furniture

and fixtures

Hiring of employees

Start of operation

Organizational Chart

77

Key Personnel

Job title: Manager

Job specification:

At least 20 Years old and above

Must be a graduate of any business course

Must have at least 1 year experience in a managerial position

Must have the knowledge and skill about management

Strong leadership skills

Ability to effectively teach/develop others to next level.

Good merchandising skills and a flair

Strong interpersonal, motivational, communication and organizational

skills

Job description:

78

Manager

Storekeeper/ Caretaker Veterinarian

Accountant

Cashier

Daily duties and responsibilities:

Monitors the daily operation of the pet shop

Handles customer’s grievances and needs

Ensure all orders are properly documented and released for pick-up

Communicate, execute, and manage marketing and merchandising

programs

Supervision of employee tasks and training

Monthly duties and responsibilities:

Communicate, execute, and manage marketing and merchandising

programs

Responsible for preparation of work schedules.

Other duties:

Can only make minor decision-making.

Develop and implement employee performance evaluations and

improvement plans.

Hires and fires an employee

Job title: Accountant

Job specification:

At least 20 Years old and above

Must be graduate of Bachelor of Science in Accountancy

Must have at least one year experience in General accounting and Book

keeping, preparation of financial reports and bank transactions.

Must have good decision-making skills specifically in management

advisory.

Must have a pleasing personality and credibility in giving advises and

decisions.

79

Must have good communication skills

Must have good mathematical and analytical skills

Must be computer literate

Job description:

Daily duties and responsibilities:

Prepare forms and manuals for accounting and bookkeeping personnel,

and direct their work activities.

Records the daily financial transactions of the business

Provide clerical and administrative support to management as requested

Monthly duties and responsibilities:

Process payroll in a timely manner

Prepares schedule for receipts and disbursements

Keeps the records of the inflow and outflow of cash

Processes the utility bills

Develop, maintain, and analyze budgets, preparing periodic reports that

compare budgeted costs to actual costs.

Other duties and responsibilities:

Maintain an orderly accounting filing system

Advise management about issues such as resource utilization, tax

strategies, and the assumptions underlying budget forecasts.

Examine and analyze accounting records, financial statements, and other

financial reports to assess accuracy, completeness, and conformance to

reporting and procedural standards

Job title: Cashier

Job specification:

80

At least 20 Years old and above

Must be a college graduate of bookkeeping/accountancy course

Must have knowledge of basic arithmetic.

Must have skill in handling and counting cash.

Must have skill in communications with public.

Job description:

Daily duties and responsibilities:

Counts money, gives change and issues receipt for funds received.

Maintains sufficient amounts of change in cash drawer.

Balances cash drawer and receipts; documents discrepancies.

Assists customers in locating specific items.

Keeps register area neat and stocked with necessary supplies.

Assists in other areas of store, such as clean-up, shelf-stocking, or

keeping merchandise displayed in an orderly manner.

Job title: Veterinarian

Job specification:

At least 20 Years old and above

Must be a graduate of Veterinary Medicine course

Must be a license veterinarian

Must have skill and passion in working with animals

Must have at least one year experience in veterinary position

Job description:

To ensure that love birds are in good health condition

To inform the management in case the love birds are infected of a disease

To provide medical aide to infected love birds

81

Job title: Storekeeper/Caretaker

Job specification:

At least 20 Years old and above

Must be a college graduate

Must have knowledge and experience in storekeeping

Must have skill and passion in working with animals

Must have skill in concentrating on routine tasks

Must have at least two years driving experience as professional driver (for

delivery purposes)

Job description:

Daily duties and responsibilities:

Feed, water, nurture, and care for lovebirds

Clean and disinfect cages

Securing the condition of lovebirds

Other duties and responsibilities:

Ensure safe transport of animals

Store and release supplies or equipments

Record the number and the kinds of love birds supplies

Compile the records of the supplies

Checking the supplies from time to time

Internal Policies

Love & Pair Company set these following policies in order to promote

harmonious relationship and provide a health working environment for the

owners and the employees.

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General Policy

1. Working Hours

The store will operate from 8:00 AM to 5:00 PM. Each personnel will work

for eight hours. Working hours are recorded using a database system to

ensure the number of working hours.

2. Attendance, Absenteeism and Tardiness

The personnel are required to come to the shop 30 minutes before the

shop open.

The employees are expected to have a regular attendance.

If a staff will not be able to come to work, he/she will inform the managers

two hours before his/her shift starts and state a valid reason.

Leave of Absence

The following are the rules concerning specific leaves:

1. Sick Leave - A medical certificate shall be presented in all cases of

absence by an employee for three (3) consecutive days or more.

The regular pay rate shall be received by the employee during the

said leave. Employees shall receive a maximum allowable sick

leave of seven (7) days.

2. Vacation Leave – Love & Pair Company personnel are granted

vacation leave to be used for personal purposes. Employees shall

receive a maximum allowable vacation leave of five (5) days.

3. Maternity Leave - Women employees of Love & Pair Company are

granted maternity leaves for their childbirth and will be paid based

on their regular pay rates. A total of seventy five (75) days of

maternity leave are allowed for the women employees.

4. Paternity Leave - Men employees of Love & Pair Company are

granted paternity leaves to attend to their legitimate wife’s delivery

or miscarriage. There would be a maximum of seven (7) days of

paternity leave which will be paid in full.

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5. Emergency Leave – Love & Pair Company will grant emergency

leave to its personnel for a maximum of ten (10) days each

calendar year. Employees can use their emergency leaves in case

of injury, medical emergency, death and any other urgent matters

relating to their family members and immediate relatives.

3. Uniform

Every employee is required to wear proper uniform every time they will go

to work. Their uniform is designed with the logo of the Love & Pair Co.

Below is an illustration of the t-shirt of the Love & Pair Co. uniform:

(Front & Back View)

3. Payday/Compensation

The salary of the employees will be given on a semi-monthly basis. All

employees will be paid on the 15th and 30th day.All personnel will be

paid Php525 per day and the bookkeeper will be paid Php 12,000

84

monthly. The manager of the shop, who is also a partner, will be paid

Php 15,000 monthly.

3.1 Employee Benefit

Mandatory benefits such as SSS, PhilHealth and Home Development Mutual

Fund (Pag-Ibig) Premiums are also provided to the employees and are based on

the SSS,PhilHealth and HDMF Contribution table provided by the law. Each

employee is entitled to a basic salary of P525.00 per day, accumulating to

P10,500.00 each month to which the said benefits are computed.

Number of employees SSS PhilHealth PAG-IBIG Total Employer's Share Monthly ER Annual ERCashier 1 P742.00 P125 P210.00 1077 1077 12924Storekeeper 2 P742.00 P125 P210.00 1077 2154 25848Total P2,226.00 P375.00 P630.00 3231 38772

Employee Number of employees SSS PhilHealth PAG-IBIG Total Employee's Share Monthly EE Annual EECashier 1 350 125 210 685 685 8220Storekeeper 2 350 125 210 685 1370 16440Total 1050 P375.00 P630.00 2055 24660

Social Security System (SSS) – The Social Security System was created by

the Philippine government.  All employees hired by private companies are

required to become an SSS member (Republic Act No. 8282).  This system

aims to protect its members for when they are unable to work such as

sickness, disability, maternity, old age and death, or other such contingencies

not stated but will result in loss of income or results to a financial burden.

Philippine Health Insurance (PhilHealth) – The Philippine Health Insurance

Corporation is the medical insurance company of the Philippines.  All

employees are required to be contributors of this service (Republic Act

7875).  Members are given health and hospitalization subsidies should they

or a dependent be hospitalized.  Monthly contributions are based on actual

85

employee monthly salaries and the amount of employee contribution is

matched equally by the employer.

Home Development Mutual Fund (Pag-ibig Fund) – Employers are also

required to contribute, on behalf of their employees, to the Home

Development Mutual Fund (Republic Act 7835).  This company provides the

lowest interest housing and land acquisition loans to its members that are

payable for up to 30 years.  This gives every Filipino worker an opportunity to

own a house in easy-payment plans that can directly be deducted from their

monthly wages.

13th Month Pay – Based on Presidential Decree No. 851, all Filipino

employees are entitled to a year-end bonus equivalent to one (1) month

salary regardless of the nature of their employment.  The 13th month pay is to

be given no later than December 24 of every year a worker is employed.

Overtime Pay and Holiday/Rest Day Pay - Under Article 87, an employee

who renders over eight (8) hours of service per day shall be given an

overtime pay which is equivalent to his regular hourly wage plus at least

twenty-five percent (25%) thereof.  Under Article 93, if an employee is asked

to work on their scheduled rest day or on a non-working holiday, the

employee shall be paid an additional compensation of at least thirty percent

(30%) of his regular wage.

Other company benefits – Other company benefits that are not government

mandated, but are usually given to employees anyway are:

a. Mid-year Bonus – A midyear bonus is given to employees for P2,000.00

each

b. Christmas Bonus – This is given in December, on top of the 13th month

pay.  This is considered as the company’s Christmas gift to their

employees.

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Chapter IV

Financial Aspect

Statement of assumption

Love & Pair Co., a partnership type of business, is managed by a partner,

Pauline Naranjo and has the following assumptions:

Each partner has a capital contribution amounting to Php 400,000.

Financial statements are projected for 10 years.

87

The fair values of Biological Assets are based on the ages of lovebirds.

The inflation rate is 2.41%.

Operating rent expense for the lease is fixed for the 10 years.

Utilities expense increases by 5% every year.

90% of the purchased supplies will be used every year.

Advertising expense will decrease every year by 10%.

Repairs and Maintenance will increase every year by 10%

Property, plant and equipment are depreciated using the straight line

method.

SSS, PhilHealth and PAG-IBIG, contributions are based on the table

provided by the government.

Income tax is 30% of net income before taxes.

A bonus of 10% of net income after tax will be given to the managing

partner.

Remaining balance of net income will be shared equally by the partners.

The exchange rates of dollar to peso for 2014 to 2023 are and 41.48,

41.80, 41.60, 40.88, 41.20, 41.35, 41.72, 41.40, 41.80 and 41.65

respectively.

The 40% purchase is on account and 50% of it will be paid during the

year.

20% of sales are accounts receivable at the end of the year.

The salaries of Managing Partners, Pauline Mae L. Naranjo and Arbiegail

Cañas will be directly accounted to their capital.

Every partner withdraw Php 30,000 for 10 years except Pauline Mae L.

Naranjo and Arbiegail Cañas who withdraw 6th to 10th year Php 300,000

After 5 years we purchase Tools and Office Equipment and depreciated

using the straight line method.

We classified the breeders as biological asset and their chicks are

reclassified to inventory which is intended for sale.

The Mark-ups is 50% on domestic sales and 150% on export sales.

The export sale is zero rated vat.

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89