PAMANTASAN NG LUNGSOD NG MARIKINA 2

Chapter 1 D
E
The Industry and the Company and Its Products and Services P
A
R
The Industry T
M
E
A coffeehouse, coffee shop or café (sometimes spelled cafe) is an N
T
establishment which primarily serves hot coffee, related coffee beverages (e.g., café
O
latte, cappuccino, espresso), tea, and other hot beverages. Some coffeehouses also F

H
serve cold beverages such as iced coffee and iced tea. Many cafés also serve some O
S
type of food, such as light snacks, muffins or pastries. P
I
T
A
In the modern life, a lot of company employees leave their job because they L
I
T
do not find job interesting. They feel pressured and boring. A set of young people Y

today do not like working for the company after graduated, they like to challenge A
N
themselves. They wanted to establish their own company or business where they can D

T
show all their best skills and personal passion. We are people belongs to this part. We O
U
learn business and we have passion for business. It goes without saying that necessity R
I
is the mother of invention, so merchants created the business to make good use of S
M
people’s need of drinking water.
M
A
N
A
It goes without saying that necessity is the mother of invention, so merchants G
E
created the business to make good use of people’s need of drinking water. In the past, M
E
N
we would drink plain water or juice to quench our thirst. Nowadays, there are much T

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more competitions as more and more prosperous tea cafes spring up. To appeal to D
E
more customers, the increased sorts of beverages followed the increase of innovative P
A
ideas. Then, milk tea came into being. Modern people drink beverages instead of R
T
M
plain water. Among that, Milk tea is a drink in great demand.
E
N
T

Milk tea refers to several forms of beverage found in many cultures, O

F
containing some combination of tea and milk. Beverages vary based on the amount of
H
O
each of these key ingredients, the method of preparation, and the inclusion of other S
P
ingredients (varying from sugar or honey to salt or cardamom). Instant milk tea I
T
powder is a mass-produced product. A
L
I
T
Y
Milk tea is also an extremely popular drink in most of Asian countries. It
A
originally started from Taiwan in 1988. Milk teas specialist drink increasingly being N
D
offered in cafes, coffees shops and bars. It originates from Asia and is made up of hot
T
O
or cold tea, milk, sugar and giant black tapioca balls. Ice is then added and the drink U
R
shaken to create the bubble effect. Bubble tea is often referred to as pearl shake, I
S
tapioca ball drink; bob ice tea and bubble drink among other things. The term M

M
"bubble" refers to the tapioca balls in the drink. These chewy tapioca balls, or A
N
"pearls," are consumed along with the beverage through a wide straw. A
G
E
M
E
Bubble tea is especially popular in many East Asian and Southeast Asian
N
T
regions such as Taiwan, Brunei, China (including Hong Kong and Macau), Malaysia,

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the Philippines, Singapore, South Korea, Thailand, Indonesia, Vietnam and Australia D
E
populated by urban professionals with high disposable incomes and an interest in P
A
alternative eating and drinking venues. Compared to opening a full size restaurant, the R
T
M
startup costs to open a milk tea cafe are low. The wide range of our contacts &
E
N
relationships mean we will open a milk tea cafe with minimal investment ensuring we T

get the biggest bang for our buck. A milk tea cafe is not labor intensive, is simple to O
F
operate and does not necessitate that the owner be on site. The key is to get things set
H
O
up correctly in the early stages and to use effective operating systems to save valuable S
P
time, effort, and money. I
T
A
L
I
From a cultural standpoint, cafes largely serve as centers of social interaction: T
Y
the cafe provides patrons with a place to congregate, talk, read, write, entertain one
A
another, or pass the time, whether individually or in small groups. Since the N
D
development of Wi-Fi, cafes with this capability have also become places for patrons
T
O
to access the Internet on their mobile phones, laptops and tablet computers. A cafe can U
R
also serve as an informal club for its regular members. I
S
M

M
The Company and the Concept A
N
One of the trends which attracts most of the youth is chain of coffee and milk- A
G
tea shops. Because they have air conditioning and free Wi-Fi so now they become E
M
E
ideal hangout spaces. Many famous milk-tea trade-names appear in recent years such
N
T
as: Infinitea, I Love Milktea, Gong Cha, so on. They have a lot of branches around

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the country. Especially, around university zones, they usually have about 5 big or D
E
small milk-tea shops. This proves that milk-tea is one of favorites drinking of youth P
A
community, particularly pupils and students. R
T
M
E
N
Another trend which is very popular among the social media account users T

nowadays is the term “hugot”, a Filipino word which means to draw or to pull out. O
F
The usage of the hashtag “#hugot” became popular not so long ago and is usually
H
O
used along with song lyrics, a quote, etc. that the person tweeting relates to; “#hugot” S
P
means the accompanying words draw emotions out of him/her. I
T
A
L
I
Hugot. Usually words with potentially and personally deep sentimental or T
Y
emotional undertones. Because feelings come from "deep within" so you have had to
A
"hugot" your emotions first "from deep within" before you would've actually blurted N
D
them out in somehow emotionally undertoned words — subconsciously or otherwise.
T
O
You can find a lot of these on Twitter and Tumblr — even whole accounts dedicated U
R
to churning out such quotes at a rate of one a minute. I
S
M

M
Starting from individual favorite, business passion and faults which are still in A
N
milk-tea market, with that it comes the idea to combine the two trends which is Milk A
G
Tea and Hugot to establish the Hugot Milk Tea Cafe from general interests of 5 E
M
E
students who are looking to be challenged themselves after school in the group. We
N
T
are confident that we will become the first best beverage quality products supplier

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and professional service style here in Marikina. With the mission to bring D
E
convenience to the consumers and to meet their customer satisfaction. We will apply P
A
our very own Filipino’s service style and service system and combine with new R
T
M
flavors from other countries. Besides that we also hope with new processing formula,
E
N
milk-tea not only a beverage but also a nutrition drink for all ages, from kids to T

teenagers to students, to the workers or employees working in large firms and so on. O
F

H
O
The Products and the Services S
P
The main products are milk tea with delicious taste that is named after famous I
T
hugot lines where the millennials nowadays are hooked into it. The traditional A
L
I
coffee-milk along with fruit smoothies for refreshment and vitamin supplements T
Y
during hot days in Marikina City. Specially, customers can chose how many
A
percentage of ice and sugar (25% - 50% - 75%) and they can also mix drinks with N
D
mouth-watering snacks at a very affordable prices.
T
O
HUGOT MILK TEA CAFÉ MENU U
Hugot Name Milktea Flavor Price R
Regular Large I
Milktea ng Single Wintermelon Milktea Php 90 Php 120 S
M
Milktea ng Iniwan Chocolate Almond 90 120
M
Milktea A
Milktea ng Diyosa Strawberry Milktea 90 120 N
Milktea ng Sexy Kiwi Milktea 90 120 A
Milktea ng Virgin Vanilla Milktea 90 120 G
E
Milktea ng Richkid Oreo Milktea 90 120 M
Milktea ng Goodgirl Blueberry Milktea 90 120 E
Milktea ng Taro Milktea 90 120 N
T

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Friendzoned D
Milktea ng Na-fall Banana Milktea 90 120 E
Milktea ng Sawi Iced Coffee Milktea 90 120 P
Milktea ng Bitter Dark Almond Milktea 100 130 A
Milktea ng Broken Dark Cocoa Milktea 100 130 R
T
PETMALUNG PASTRIES M
Rebound Blueberry Cheesecake Php 100 E
Complicated Redvelvet Cheesecake 100 N
Taken Bavarian Donut 30 T
Single Glazed Donut 30
O
Thirdwheel Chocolate Donut 30 F
Loner 1pc Chocolate Waffle 30
Couple 2pcs Chocolate Waffle 50 H
WERPANG SNACKS O
Friends with Fries ( Cheese, 50 S
P
I
Benefits Sourcream,BBQ) T
Back Together Nachos 50 A
L
I
The services: We apply the hygienic and best quality services. In addition, there will T
Y
have delivery milk-tea service for bulk buyers. A
N
D

Entry and Growth Strategy T

O
In order to choose right entry strategy, it should consider such facts as culture U
R
I
of the country, population, habits and etc. S
M

M
A
N
A
G
E
M
E
N
T

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D
E
P
A
R
T
M
E
N
T

O
F

H
O
S
P
I
T
Joint Ventures A
L
One of the strategies the company could pursue is the Joint venture. The Joint I
T
Y
Venture parties are in agreement to expand a new entity and a new asset by providing
A
equity. Both parties have control over the company and divide assets, expenses and N
D
revenues. This strategy has advantages and disadvantages. On the one hand, it
T
O
provides access to new markets and sectors. Partners can break down their company
U
R
and then form their own enterprises. On the other hand, there are some disadvantages I
S
of forming joint ventures. First, it could be very difficult to make good relationships M

with the partner. Second, the structure and the kind of management of the companies M
A
N
can be very different. A
G
Franchising E
M
Franchising is now very common marketing strategy. It is when two E
N
T
companies agree to cooperate, one of these companies permits another one to sell its

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products and services created of the first firm. Another company gets label, trademark D
E
and idea of selling products. There are many pluses of this strategy. First is that P
A
buying franchise from one company, you can help to expand this company and make R
T
M
it known all over the world. Second, the company, which sells franchise, earns more
E
N
money by providing its products and services. The second company, which buys T

franchise, also gets revenue by using trademark of the company. For example, a O
F
company can use the products and services of the well known enterprise. It means
H
O
that the services and products will be demanded until the franchiser becomes a S
P
bankrupt. On the other hand, franchisee must sell only the definite product with the I
T
one trademark not changing the idea. Moreover, franchisee could fail selling services A
L
I
in the wrong way, so consumer can see the company not right. After opening a café in T
Y
Marikina. The business can expand by using Franchise strategy. The owners can later
A
sell franchise in order to make their brand widely known. N
D

T
O
To sum up, the most appropriate strategy to use for the Hugot Milktea Café U
R
is Franchising and to reduce risks, the company should have strict control for the ones I
S
who will buy franchise of the café. M

M
One of the most important thing which helps to succeed in starting business is A
N
the choice of the right entry strategy as well as the growth strategy. A
G
A growth strategy or also known as product strategy is the ultimate vision of E
M
E
the product, it as a map guide direction for the cafe’s development. As it mentioned
N
T

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above, the target customers are students and official employers, so the products need D
E
to be diversify. P
A
For every 3 months, it is nice to launch new product to meet diversity demand R
T
M
of customers as well as bring freshness for the café.
E
N
T

O
F

H
O
S
P
I
T
A
L
I
T
Y

A
N
D

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O
U
R
Chapter 2 I
S
Market Research and Analysis M

M
Customers A
N
Knowing your customers is an essential part of business planning. The more A
G
you know about your customers, the more you know about where to find others just E
M
E
like them, how to reach them with media or other marketing communications, and
N
T
what kinds of messages, offers, and incentives move them toward buying.

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D
E
P
A
R
T
M
E
N
T

O
F

H
O
S
P
I
T
A
L
I
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Y

A
N
D

T
O
U
R
I
S
M

M
Hugot Milktea Café aims to serve everyone a budget-breaking proposition. It defines A
N
their chosen customers by location, descriptive facts, lifestyle characteristics, and A
G
purchase behaviors that’s why their target customers are highschool or college E
M
students (15-20 years old), middle class men and employees such as faculties . E
N
T

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Market Size and Trends D

E
Hugot Milktea Cafe will serve to people who want to get their daily cup of P
A
great-tasting milktea and snacks in a relaxing atmosphere. Such customers may vary R
T
M
in age, although the location is close to the school campuses means that most of the
E
N
customers will be highschool or college students and faculty or employees. The T

market research shows that these are perceptive customers that influence towards O
F
better tasting milktea. Furthermore, a lot of college students consider cafe to be a
H
O
convenient studying or meeting location, where they can read or meet with peers S
P
without the necessity to pay bigger charges. This will provide a unique possibility for I
T
building a loyal client base like Starbucks and other famous café. A
L
I
T
Y
General trend toward quality among Filipino consumers definitely plays an
A
important role in the recent growth in milk tea lovers. Additionally, such factors as N
D
desire for small service, for something more exotic and unique, provide a good selling
T
O
opportunity for cafes. U
R
I
S
M

M
A
N
A
G
E
M
E
N
T

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Competition and Competitive Edge D

E
SWOT Analysis for Hugot Milktea Café P
A
Strengths R
T
M
One of the competitors’ aspect is the various services and products offered. A
E
N
café that serves milktea, pastries, snacks and beverages. In addition, the ambiance and T

atmosphere is so well-rounded the relaxation of the customers is guaranteed. The O

F
price is cheaper than to the other milktea brands out there but it is same to the quality
H
O
of both the product and service. S
P
Moreover, the proposed business is unique kind of service since it will be the I
T
first hugot café in the Marikina and it's at good location accessible for potential A
L
I
customers. The business have sufficient fund to execute the service, highly T
Y
technological equipment and skilled workers. The security and convenience of the
A
customers is of high-priority as well. N
D
Weakness
T
O
Every young and new business has a weakness. It could be that due to the U
R
budget, or to keep the location small or that won't be able to order premium I
S
ingredients from overseas. The weaknesses are those areas that either the cafe do not M

M
perform well in, are missing the mark on or at an overall disadvantage. A
N
Opportunities A
G
A milktea café is fast growing franchise, a lot of people love drinking E
M
E
milktea, spending time with friends at cafes or even alone time there. Its trends are
N
T
already grasped by many. The target location is accessible to the target market.

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Creating new opportunities is where you can plan for growth in products such as D
E
adding a "milktea of the month" and special discounts for frequent customers. P
A
Moreover a high-end café to be patronized, a lot of people who love milktea R
T
M
are looking for new places, desiring a new taste, and the uniqueness of the café
E
N
theme. T

Threats O
F
The competition is an obvious threat to the business, but there are other key
H
O
factors should take into account. The first, competitor is available from the S
P
weaknesses, along with the growth of competition from direct competitors. I
T
Owners must be wise. The Hugot Milktea Cafe has more shortcomings than A
L
I
other milk tea stores in the same areas such as: small investment capital and new T
Y
young brand. Secondly is the customers taste. Customers are stricter in choosing
A
drink for themselves. Flavor issue is more concerned, but to ensure health N
D
requirements. This is a major challenge in the flavor issue as well as improvement of
T
O
Hugot Milktea Cafe’s hygiene during processing drinks. U
R
I
S
Estimated Market Shares and Sales M

M
Hugot Milktea Cafe will target its marketing activities on reaching the A
N
University students and faculty, people working in offices located close to the cafe A
G
and to the millenials nowadays, particularly here in Marikina. On market research E
M
E
shows that these are the customer groups that are most likely to drink milktea. Since
N
T
café addiction is universal across different income categories and mostly depends on

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the level of higher education. D

E
P
A
The chart and table below outline the total market potential (in number of R
T
M
customers) of milktea drinkers in Marikina City.
E
N
YEAR 1 YEAR 2 YEAR 3 T
Potential Market
O
F
Customers %
H
Growth O
15-16 years old 2% 3500 4200 4900 S
P
Middle Class 2% 2500 3000 3500 I
Employees 2% 1000 1200 1400 T
A
Others 1% 500 550 600 L
I
Total 7500 8950 10400
T
Y

On-Going Market Evaluation A

N
D
Milk tea, specifically bubble tea, has become a popular beverage for Filipino
T
consumers over the past years. Its popularity has given rise to hundreds of milk tea O
U
stalls and stores and has made major restaurant chains include it in its menu. Clearly, R
I
S
the demand for milk tea in the country is steadily rising with smaller stores selling
M

around 300 drinks a day. M

A
In order to have a complete running milk tea business, you need to procure the N
A
right ingredients for your selection of milk tea products. Basic ingredients include G
E
M
tapioca pearls, syrup or powder flavorings, tea powders and leaves, milk, sugar, E
N
creamers, artificial sweeteners, ice and water. Keep in mind that milk tea shops are T

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expected to offer a diverse menu so don’t limit your product offerings. D

E
(https://www.businessnews.com.ph/guide-starting-milk-tea-business-philippines- P
A
20161126/) R
T
M
E
N
T

O
F

H
O
S
P
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A
L
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Y

A
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D

T
O
Chapter 3 U
R
The Economics of the Business I
S
The Economics of the Business M

M
Milk tea is also known as pearl milk tea, boba milk tea, boba tea, tapioca tea, A
N
bobanai cha, pearl tea, bubble tea, bubble drink, tapioca pearl drink, momi, momi A
G
milk tea, QQ, or any combination above. The oldest known milk tea consisted of a E
M
E
mixture of hot Taiwanese black tea or green tea, small tapioca pearls, condensed milk,
N
T

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and syrup. Many variations were created, the most common of which is served cold D
E
rather than hot. P
A
Milk tea is generally offered in two distinct ways as a fruit-flavored cream R
T
M
drink and a sweetened fruit drink. Most fruit-flavored cream drink includes powdered
E
N
non-dairy creamers to "cream" the drink, but some shops also offer fresh milk, ice T

cream, soy milk, or lactic milk as an alternative. These creamed drinks may or may O
F
not include tea as its base liquid. A sweetened fruit drink usually includes crushed-
H
O
fruit smoothies with tapioca pearls to add fun. Milk tea comes in a variety of different S
P
flavors, the most popular being the fruity and creamy ones. Some widely available I
T
fruity and creamy flavors include strawberry, mango, watermelon, banana, blue berry, A
L
I
and kiwi. Other popular non-fruity and creamy flavors include taro, chocolate, coffee, T
Y
mocha, black milk tea, oreo milktea, vanilla milktea and almond milktea. There are
A
now 250 varieties of flavors and choices of a milk tea drink. N
D
There are many health benefits of milk tea. This benefit produced by the
T
O
combination of milk and tea. A milk and tea have some health benefit in their self, U
R
and when this two beverages are mixed, it will gives health benefits. The health I
S
benefit that gives by this beverage is keeping our immune. Immune is the most M

M
important thing inside the body because has function to guard our healthy. A
N
With the combination of the features and benefits of drinking milktea together A
G
with the theme of Hugot which is very popular to the millenials now a days. Hugot E
M
E
Milktea is not just about the product but also its concept where the customers can
N
T
express their Hugot feelings and emotions. The aura of the place also connects with

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the customers and even employees know how to manage and deal with the customers D
E
needs and wants that made the café different from other cafes. P
A
R
T
M
Gross and Operating Margins
E
N
Gross Profit Margin T

Ingredients Php 10,000 O

F
Raw Materials 5,000
H
O
Utilities S
P
 Water 2,000 I
T
A
 Electricity 5,000
L
I
Rent 10,000 T
Y
Total Php 32,000
A
Expected income in a day Php 4, 500 N
D

x 30 days T
O
Expected income in 1month Php 135, 000 U
R
I
S
M
Gross Profit Margin = Revenue – Cost of Good Sold
M
Revenue A
N
= 135, 000 – 32, 000 A
G
E
135, 000
M
E
GPM = 0.76 or 76% N
T
Operating Gross Margin

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Equipment Php 25, 000 D

E
Maintenance 10, 000 P
A
Taxes & Licenses Expense 10, 000 R
T
M
Salary & Wages 24, 000
E
N
Total Php 69, 000 T

O
F
Operating Profit Margin = Operating Income
H
O
Total Revenue S
P
= 69, 000 I
T
135, 000 A
L
I
OPM = 0.51 or 51% T
Y

A
Profit Potential and Durability N
D
According to our computation about gross profit margin and operating gross
T
O
margin, we estimated possible expenses and get the total revenue of Php 135, 000. U
R
And we found out that we get at least half of 100% revenue. I
S
M

M
A
N
A
G
E
M
E
N
T
Fixed, Variable and Semi-variable Cost

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Variables D
E
The variable cost that the café considered are the following: P
A
Ingredients Php 10,000 R
T
M
Raw Materials 5,000
E
N
Utilities T

 Water 2,000 O
F

 Electricity 5,000
H
O
Rent 10,000 S
P
Total Php 32,000 I
T
A
Expected income in a day Php 4, 500 L
I
x 30 days T
Y
Expected income in 1month Php 135, 000
A
N
D

Fixed T
O
The fixed variable cost that the café considered are the following: U
R
I
S
M
Equipment Php 25, 000
M
Maintenance 10, 000 A
N
Taxes & Licenses Expense 10, 000 A
G
E
Salary & Wages 24, 000
M
E
Total Php 69, 000 N
T
Months to Breakeven

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D
E
Months to reach Positive Cash Flow P
A
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F

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Y

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