THE INTRODUCTORY PRODUCT LINE OF PARALINK:

BOOKPORT, AN ERGONOMICALLY DESIGNED BOOK STAND THAT MULTI-

FUNCTIONS AS A FILE FOLDER

A Research Study and Business Plan Submitted to the

Decision Sciences and Innovation Department

Ramon V. del Rosario College of Business
De La Salle University - Manila
2401, Taft Avenue, Malate, Manila 1004

In Partial Fulfillment of the

Requirements for the Course

Practical Research 2
First Trimester A.Y. 2018-2019

BANSIL, Arvel John J.

MEDINA, Ron Edward G.
NICOLAS, Paolo Ian U.
TABORA, Antoninio N.

Professor Reynaldo Mones

Adviser

August 30, 2018

 Table of Contents
LIST OF FIGURES ........................................................................................................................ i
LIST OF TABLES ....................................................................................................................... iii
EXECUTIVE SUMMARY............................................................................................................ iv
CHAPTER I: INTRODUCTION AND BACKGROUND OF THE STUDY .................................. 1
Conceptual Framework .......................................................................................................... 1
Problem Statement ................................................................................................................. 1
Hypotheses/Propositions ........................................................................................................ 2
Research Objectives .............................................................................................................. 2
Significance of the Study ........................................................................................................ 2
Significance to the Preferred Target Market ........................................................................ 2
Significance to ParaLink...................................................................................................... 3
Scope and Limitation .............................................................................................................. 3
Research Design .................................................................................................................... 3
Respondents .......................................................................................................................... 4
Data Collection ....................................................................................................................... 4
Presentation and Analysis of the Data .................................................................................... 4
Conclusion ............................................................................................................................. 4
CHAPTER II: MANAGEMENT AND ORGANIZATION ........................................................... 6
Management Team ................................................................................................................ 6
Compensation and Ownership ..............................................................................................14
Compensation ....................................................................................................................14
Ownership..........................................................................................................................15
Capitalization .........................................................................................................................15
Board of Directors/Advisory Council ......................................................................................16
Contracts and Franchise Agreements ...................................................................................17
Employment Contract.........................................................................................................17
Partnership Contract ..........................................................................................................18
Retail Distribution Agreement.............................................................................................18
Organizational Chart..............................................................................................................19
FINANCE AND ACCOUNTING DEPARTMENT ....................................................................20
MARKETING DEPARTMENT ................................................................................................20
STRATEGIC OPERATIONS DEPARTMENT ........................................................................21
 HUMAN RESOURCES DEPARTMENT ................................................................................22
CHAPTER III: PRODUCT ........................................................................................................23
Purpose of the Product/Service .............................................................................................23
Unique Features ....................................................................................................................23
Stages of Development .........................................................................................................24
Future Research and Development .......................................................................................25
Trademarks, Patents, Copyrights, Licenses, Royalties ..........................................................26
Brand Name.......................................................................................................................26
Brand Logo ........................................................................................................................26
Government Approvals ..........................................................................................................26
Product Limitations ................................................................................................................27
Product Liability .....................................................................................................................27
Related Products/Services and Spin-Offs ..............................................................................28
Production .............................................................................................................................29
Production Process ............................................................................................................29
Labor Requirements ..........................................................................................................29
Production Output ..............................................................................................................30
Facilities ................................................................................................................................30
Suppliers ...............................................................................................................................31
Environmental Factors...........................................................................................................31
CHAPTER IV: MARKETING PLAN ........................................................................................32
Industry Profile ......................................................................................................................32
Current Size .......................................................................................................................32
Growth Potential ................................................................................................................32
Geographic Locations ........................................................................................................33
Industry Trends ..................................................................................................................33
Seasonality Factors ...........................................................................................................34
Profit Characteristics ..........................................................................................................34
Distribution Channels .........................................................................................................35
Basis of Competition ..........................................................................................................35
Competition Profile ................................................................................................................36
Porter’s 5 Forces................................................................................................................36
Customer Profile ....................................................................................................................37
 Demographic Segmentation ...............................................................................................37
Behavioral Segmentation ...................................................................................................38
Target Market Profile .............................................................................................................39
Pricing Profile ........................................................................................................................40
Policies for Large Orders ...................................................................................................40
Sensitivity of Price..............................................................................................................40
Gross Margin on Products/Services ......................................................................................41
Break-Even Analysis .............................................................................................................41
Year 1 Break-Even Analysis...............................................................................................41
Year 2 Break-Even Analysis...............................................................................................42
Market Penetration ................................................................................................................42
Distribution Channels .........................................................................................................42
Sales Representatives .......................................................................................................43
Direct-Sales Force .............................................................................................................43
Direct Mail/Telemarketing ..................................................................................................44
Advertising and Promotion.....................................................................................................44
Packaging and Labeling ........................................................................................................44
Service and Warranties .........................................................................................................45
Trade Shows .........................................................................................................................45
Future Markets ......................................................................................................................46
CHAPTER V: OPERATING AND CONTROL SYSTEMS .........................................................47
Administrative Policies, Procedures and Controls ..................................................................47
ParaLink’s Standard Operating Procedures .......................................................................47
Documents and Paper Flow ...............................................................................................51
Planning Chart ...................................................................................................................53
Risk Analysis .....................................................................................................................55
CHAPTER VI: FINANCIAL PLAN ...........................................................................................56
Sales and Income Projections ...............................................................................................56
First Year of Operation ..........................................................................................................56
Second Year of Operation .....................................................................................................61
Cash Requirements ...............................................................................................................65
Sources of Financing .............................................................................................................66
Attached Financial Projections ..............................................................................................68
Balance Sheet and Statement of Financial Position...............................................................71
 LIST OF FIGURES

Figure 1: Conceptual Framework of the Study

Figure 2: ParaLink’s Chief Executive Officer
Figure 3: ParaLink’s Chief Operating Officer and Marketing Department Head
Figure 4: ParaLink’s Chief Financial Officer
Figure 5: ParaLink’s Human Resources Department Head
Figure 6: Organizational Structure of ParaLink
Figure 7: Idea Generation Flowchart
Figure 8: Brand Logo
Figure 9: Production Process Flowchart
Figure 10: National Capital Region.
Figure 11: Official Receipt of ParaLink.
Figure 12: Direct Selling Flowchart
Figure 13: Online Selling Flowchart
Figure 14: Marketing Flow Chart.
Figure 15: Breakdown of the Monthly Purchases of ParaLink for the First Year of Operations
Figure 16: Breakdown of the Units Sold per month by ParaLink for the First Year of Operations
Figure 17: Breakdown of the Monthly Cost of Goods Sold by ParaLink in the First Year of
Operations
Figure 18: Breakdown of the Monthly Total Revenue and Gross Profit of ParaLink for the First
Year of Operations
Figure 19: Total Breakdown of the Net Income/Retained Earnings of ParaLink for the First Year
of Operations
Figure 20: Breakdown of the Monthly Purchases of ParaLink for the Second Year of Operations
Figure 21: Breakdown of the Units Sold per month by ParaLink for the Second Year of
Operations
Figure 22: Breakdown of the Monthly Cost of Goods Sold by ParaLink in the Second Year of
Operations
Figure 23: Breakdown of the Monthly Total Revenue and Gross Profit of ParaLink for the
Second Year of Operations

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Figure 24: Total Breakdown of the Net Income/Retained Earnings of ParaLink for the First Year
of Operations
Figure 25: ParaLink’s Income Statement for the First Year of Operations
Figure 26: ParaLink’s Income Statement for the Second Year of Operations
Figure 27: ParaLink’s Statement of Financial Position for the First Year of Operations
Figure 28: ParaLink’s Monthly Balance Sheet Breakdown for the First Year of Operations
Figure 29: ParaLink’s Monthly Balance Sheet Breakdown for the Second Year of Operations
Figure 30: ParaLink’s Statement of Financial Position for the Second Year of Operations
Figure 31: ParaLink’s Financial Ratio Analysis for the First Year of Operations
Figure 32: ParaLink’s Financial Ratio Analysis for the Second Year of Operations

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 LIST OF TABLES

Table 1.1 Breakdown of the Compensation of Executive Officers of ParaLink.

Table 1.2 Investments of the Partners
Table 1.3 Board of Directors of ParaLink
Table 2.1 Distribution of Labor
Table 2.2 Production Output Goals
Table 2.3 Supplier Details of the BookPort
Table 3.1 Gross Profit Margin
Table 3.2: Year 1 Break-Even Analysis
Table 3.3: Year 2 Break-Even Analysis
Table 4.1: Start-up Cash Requirements of ParaLink
Table 4.2: Operating Cash Requirements of ParaLink

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 EXECUTIVE SUMMARY
ParaLink is a start-up business in the school and office supplies industry who mainly
caters to the population of De La Salle, Manila. Its main focus is to provide its market with
ergonomically sustainable products, mainly during studies. These products are to be
continuously innovated in order to satisfy a larger future market.

Venture Description
ParaLink's venture falls under the school and office supplies industry. The company is
currently in position to give their suppliers funds to begin production. After production and
selling, the company is to address feedback from the buyers in order to improve the product and
customer relations. The main difference of the products to be provided by ParaLink would be on
its purpose and situations where they are to be used. These products are to create a more
comfortable and efficient working environment for its users.

Venture Organization
The partners of ParaLink are Mr. Arvel Bansil, Mr. Ron Medina, Mr. Paolo Nicolas and
Mr. Antoninio Tabora. The business is equally owned by the partners because it is a limited
partnership. This means that each of the partners have a limited liability - the partners are not
personally liable for the obligations of the business. ParaLink will employ a top-down
management approach. Although multistream and mainstream approaches to management can be
observed, mainstream approaches will be more evident in the management of the business.
The key management personnel of ParaLink consists of the partners themselves. Mr.
Arvel Bansil is the Chief Executive Officer with the utmost responsibility to ensure the overall
success of the company. Important corporate decisions, as well as managing the entire business
will be one of his main job. Mr. Antoninio Tabora is the Chief Operating Officer and will also
act as the Head of the Marketing Department. Alongside his responsibilities in overseeing the
overall operations of the business is making sure that the marketing communications program is
effective. Mr. Ron Medina is the Chief Financial Officer with the main responsibility of making
sure that the company is generating profit. All concerns regarding the financials of the company
and ensuring that specific financial goals are met will also be directed to him. Lastly is Mr. Paolo

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Nicolas acting as the Head of the Human Resources Department. His role of improving the
people function of the business is vital in ensuring success. By training employees and assisting
them in reaching their potential, the mission and vision of ParaLink can be realized through the
human resources.
Aside from the key management advisors, ParaLink also has an advisory council that will
serve as resource persons in creating decisions for the business.

Venture Market
The global industry of school and office supplies is open to a large market, if not
everyone. With respect to that idea, ParaLink is to only cater to a market who believes in the
need for efficiency and comfort when in their workspace. Since majority of the companies in this
industry provides supplies used which are directed towards purpose, ParaLink aims to provide its
market with equally valued products, and with more value to comfort. In addition, the increase of
volume in technological advancements have resulted to trends the industry must adapt to. These
trends are to be closely monitored by the marketing and strategic operations department for the
business to gain a proper grasp of its market.
The company will position itself to its target market being a company that focuses on
their needs in the workplace. Major competitors in the industry are indirectly bookstores across
campus, and others alike. The strengths of the competitors are mostly on the purpose of the
products they create, ParaLink will have the upper hand by how the products they create will pay
more value to comfort and efficiency, without the cost of its purpose.

Venture Operations
The operations area will explain on how cash shall go in and out of the company.
ParaLink shall startup the company with a capital of PHP 50,000 and this shall be equally
distributed to the costs of production, marketing, and operations. Budget is monitored at all times
to ensure that the company is not losing profits already, this shall be monitored by following a
yearly budget plan made. The operations section will contain an explanation as to how orders
shall be processed since the company shall serve online orders as well. Warranties shall also be
given but the company will require a receipt upon acquisition. Reports about how the operations
are going and how the information shall revolve around the management will be based on

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weekly update reports from each department to be given to the Board of Directors. It is also
mentioned how the staff will be developed, rewarded, and taught based from each individual’s
performance. To assure the cash of ParaLink, they shall safely keep it inside safe deposits and
bank accounts. To avoid future mishaps, it is also analyzed what are the possible risks and how
each operation is planned through with charts and images of the paper/documents of ParaLink.

Venture Financing
ParaLink’s cash requirements will be taken care of by the Board of Directors with a
monthly investment of PHP 50,000. It is projected that the PHP 50,000 would not be fully
consumed in a monthly basis and an excess will always be expected and will be reinvested for
the following month. ParaLink projects the business to be profitable and earn back the money
invested in starting up the business as soon as the first month of operations. This is due to the
monthly purchasing strategy implemented by the management. Steady growth in the first two
years of operations is to be expected of by the company. The company's projected financial ratios
are of extremely good condition considering that ParaLink is only a start-up company with
minimal capital to work with

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 CHAPTER I: INTRODUCTION AND BACKGROUND OF THE STUDY

Conceptual Framework

Formulation
Identifying of product
the demand idea to satisfy ParaLink’s
and need the demand BookPort
and need

Figure 1: Conceptual Framework of the Study

If a person experiences discomfort during reading, studying, or working, a product must
be thought of to ease this discomfort as the goal of innovating is to improve human life.
Ergonomics is the study of the efficiency of people in a working environment and that is the
need to be satisfied. Ergonomically speaking, the goal is to provide a more efficient workaround
to the current situation. This lead to the eventual formulation of BookPort, an ergonomically
designed book stand that can also multi-function as a file folder. The idea is to be able to create
something that is both ergonomically sustainable and practical. Adding the feature of the book
stand also being able to function as gives the product a sense of practicality.

This converges the idea of the conceptual framework for ParaLink’s study on BookPort.
Incorporating an Input-Process-Output (IPO) Model, allows the proponents of the study to try
identifying a need or demand to be satisfied (ergonomic products) and formulating a product idea
to satisfy that demand or need (combining ergonomic and practicality principles) which resulted
into ParaLink’s BookPort, an ergonomically designed book stand that multi-functions as a file
folder, which translate into the output.

Problem Statement
Main Problem
-Will the preferred target market of ParaLink respond positively on the company’s sole
product BookPort, an ergonomically designed bookstand that multi-functions as a file folder?

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Sub-Problem
-Does the preferred target market of ParaLink know about book stands and their purpose?
-What factors does the preferred target market of ParaLink consider when buying file
folders/organizers?

Hypotheses/Propositions
This study hypothesizes that if ParaLink will successfully market and advertise BookPort
to the preferred target market then an ergonomic and expressive need when reading or studying
will be satisfied. Discomfort when reading depends on the position of the reader and ParaLink
believes that by providing a portable book stand it would ease the discomfort incurred by bad
reading positions. Allowing the book stand to multi-function as a file folder helps the product
become for practical usage to customers.

Research Objectives
ParaLink’s management team aims to achieve the following objectives:
1. To be able to gauge the interest for the product.
2. To specifically design the product to cater to the preferred target market’s demands,
wants, and preferences
3. To find out if the preferred target market truly experience discomfort when reading and
prove that book stands will help the situation
4. To be able to gauge if pursuing to sell this product lead into a sustainable and profitable
business

Significance of the Study

Significance to the Preferred Target Market

-This study would be of importance to the preferred target market to be able for
them to see the benefits, especially the ergonomic benefits, of BookPort. This study is of
importance to those experiencing discomfort when reading to know that a portable and practical
product is there to be offered in ParaLink’s BookPort

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 Significance to ParaLink
-This study is of significance to the company as it will provide the necessary
details that will help in successfully running and operating the company. This will also serve as a
guide for the company in setting both short and long-term goals and objectives that will lead to
growth in the future.

Scope and Limitation

The study to be conducted will focus on the purchasing pattern made by the population of
De La Salle University, more specifically the student body consisting of the Senior high school,
undergraduates, and graduates. The purchasing pattern to be studied is to be inclined by their
opinions on the purpose and design of the bookstand to be sold, also known as BookPort.
Through this study, the patterns to be determined will be based on the interest level of the buyer,
as well as an influence from the opinions to be gathered.

Research Design
The research conducted by ParaLink was a survey questionnaire distributed in different
online groups. The questionnaire shall contain no less than 15 questions revolving around the
respondent’s interest in reading, and opinions about BookPort and similar products to it. The
company aims to have at least 100 respondents to be able to acquire enough information into
carefully pushing through with its first product, BookPort.

Research Locale
ParaLink’s main population for this study would be the whole population of DLSU; but
for the main target population where data is to be most valuable will be based on the Senior high
school students as well as undergraduate students. The company has picked this group for the
main reason being how they are most likely to be using both purposes of the BookPort, these
students who tend to study more often will want a bookstand as well as value its storage
capabilities especially when all they need to bring are papers. Through this claim, ParaLink can
conclude that majority of its market in terms of buyers will consist of these two (2) populations.

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Respondents
The survey to be conducted by ParaLink will be done through the means of Google
forms. The purpose of this survey is to gather necessary information for the company to
determine the style, purpose, and design required for the final product. The respondents will
consist mainly of students ranging from senior high school to college students. It is to be noted
that the responses made and gathered will be kept confidential, and no information is to be
manipulated as well as used for other purposes than research.

Data Collection
Data collection will be made through the interpretation of results through Google forms.
This data to be gathered will be information to be used by ParaLink in order to create the
BookPort to what the buyers want. Through this process, value between the company and the
customers will be created and molded, this bond is to be strengthened by giving the customers
the final product that suits most of their wants.

Presentation and Analysis of the Data

The data gathered will be used to determine the chosen size of the BookPort, as well as
its color to be mass produced. Other than the data expected to be gathered, opinions of the
respondents will also be entertained. Through this, the company will be able to produce the
BookPort in the manner where majority of the demands of its chosen market is to be observed.
The data gathered will be purely from ParaLink’s respondents, and with this data the company
may be able to conclude what actions and changes are to be necessary.

Conclusion
Continuously aiming to improve and make life easier, ParaLink decided to create a
product that helps ease a student’s everyday endeavors. With the high demands of studies or
work and time consumption, BookPort aims to support its customers’ studying/working
experience by combining a bookstand and file-folder for their paperwork and books. The
company shall aim to know more about its target market on what are their experiences with their
everyday means of storage and usage of books through the survey questionnaires to be
distributed. However, ParaLink shall not stop on one product and the company shall continue to

4
pursue the goal of producing more and more innovative products for the ease of life in the
coming future.

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 CHAPTER II: MANAGEMENT AND ORGANIZATION

This chapter summarizes information about ParaLink’s vision and mission, founders,
management team, form of ownership, organizational structure, areas of expertise, as well as
details regarding incentives and compensation of business members. Information about
infrastructures and contracts will also be discussed for the smooth flow of operations. Details
regarding the operational plans for an effective distribution of tasks among workers will also be
discussed in this chapter.

Management Team
At one eventful day in March of 2018, a group of innovative friends from the
Accountancy, Business, and Management Strand in Senior High School of De La Salle
University concocted an idea of creating a lightweight portable bookstand that could double as a
file folder. That was the moment when the company ParaLink was born. ParaLink is a Metro-
Manila based company that provides customers an ergonomic product in a bookstand that can
also function as file folder. ParaLink’s name is rooted from the founders’ first names and the
company’s mission-vision statement. The founders of the company are Paolo Nicolas, Arvel
Bansil, Ron Medina, and Anton Tabora and together will be working together at ParaLink to
provide customers a quality experience and relaxation from the comfort of virtually anywhere.

The founding fathers of ParaLink have all been granted the knowledge of running a
business competently, efficiently, and effectively by the specialized core subjects of the
Accountancy, Business, and Management program brought upon us by the prestigious De La
Salle University. The main goal of the company is not just to be able to produce significant profit
and income but also to be able to create an opportunity to improve the well-being and lifestyles
of countless people and reach a global audience to enjoy the luxury of ParaLink’s innovative
products. The founders hope to be able to continue to strive for excellence and to be able to
utilize the ELGAs (Expected Lasallian Graduate Attributes) to further the business’ success.

Every business needs the right people who are capable of leading and managing and
ParaLink is extremely fortunate to have the right of group of people with the right mindset and

6
the right skillset to produce a fruitful and prosperous business. The founders of ParaLink each
have their own specialty and expertise that complements each other very well and thus, leads into
a harmonious relationship with balance of authority and power. Effective distribution of labor is
key to ParaLink’s envisioned success in the corporate realm. The founders believe in themselves
and are confident in the business strategy laid out by them.

Figure 2: ParaLink’s Chief Executive Officer

The Chief Executive Officer (CEO) is the highest-ranking executive manager in an

organization; this necessitates utmost responsibility to ensure the overall success of the company.
ParaLink’s Chief Executive Officer (CEO) is Mr. Arvel Bansil and will be the company’s
highest-ranking executive and his primary responsibilities include making major corporate
decisions, managing the overall operations and resources of a company and developing strategies
and plans that were thoroughly conceptualized and are in-sync with the company’s short-term
and long-term objectives and the company’s mission and vision statement. He is deserving of
this position because of his excellent leadership, analyzing, managerial, and critical thinking
skills. He has the capabilities of leading the company into success. He knows what is best for the
company and always puts the organization first when making decisions. He ensures that the

7
organization’s leadership upholds constant awareness of and involvement in both external and
internal competitive landscape, opportunities, markets, and new industry developments.

The job and responsibilities of a CEO demands meeting the needs of employees,
customers, investors, community, and the law; primarily, the leader and face of the company and
should be able to effectively and efficiently create, communicate, and implement the
organization’s vision, mission, and overall direction. He must also evaluate the success of the
company in reaching its goals, making sure that the outcomes can be agreed upon by the whole
company. The CEO will be the main person to decide, set budgets, form partnerships, make
acquisitions, and hire a team to lead the business accordingly to be able to successfully clear the
path in achieving the company’s goals.

The position of CEO entails a great amount of initiative to create an organization that will
continue to grow and flourish by constantly improving the skills and abilities of employees.
Demonstrating the right level of leadership is necessary to make the company’s mission a
success. Given the highest authority within the organization, she is also given the responsibility
to represent ParaLink for civic and professional association responsibilities and activities within
the local community. Without responsibility and accountability that is actively expected and
reinforced, the he will fail to attain desired success and profitability. When it comes to the legal
responsibilities, the CEO will have an essential role to play regarding loyalty and disclosure. He
also must fulfill the duty of disclosure that mandates her to fully inform the Board of Directors,
the executive managers, and the department heads about the major internal problems to be faced
by the company. The duty of loyalty requires the CEO to always act in the best interest of the
company and its employees; he should place their interest above her own in business decisions.
He must enforce adherence to legal guidelines to maintain the company’s legality and business
ethics to avoid legal problems.

8
 Figure 3: ParaLink’s Chief Operating Officer and Marketing Department Head

A Chief Operating Officer (COO) is the one who act as a catalyst in getting the daily
operations of a business done effectively and within the specified time. Anton Tabora would be
taking the position of Chief Operating Officer (COO) of ParaLink and his responsibilities are
taking charge of the day-to-day operations of the company and will be directly and routinely
reports issues and happenings in the company to the CEO. He deserves this position for his
exemplary skills in supervising, controlling, decision making, and strategic thinking. These skills
go together with his personality of being data-driven, meticulous, and having no ego. He will be
assisting the CEO in routine work and looks after the optimization of different operations in
every department of the company. He must make sure to that the business operations are smooth
and efficient daily as the company’s second-in-command.

In addition to his position as the COO, Mr. Anton Tabora would also be named the Head
of the Marketing Department of ParaLink and will be essentially tasked with understanding and
analyzing the behavior and capturing the value of consumers in the market. This position entails
the responsibility of leading and driving the brand marketing department while building strong
relationships across the business as well as externally. He will be spearheading and designing the

9
Integrated Marketing Plan to be incorporated by ParaLink to be able to reach sales goals as
quickly and as efficient as possible. The Marketing Department Head will lead all of ParaLink’s
marketing activities from social media and digital campaigns to advertising and creative projects.

As the Chief Operating Officer; his primary duty is to design and implement business
strategies, plans, and procedures that aim to improve the flow of operations of the company. As
he oversees daily operations and work of the executives, he must able to routinely submit reports
to the CEO and to the rest of the Board of Directors to inform them of both good and bad news.
He is also the one given the responsibility to manage service employees and train them in
leadership and technical skills that coincide with the company’s mission-vision statements, so
they can effectively contribute in the business operations more efficiently to be able to ensure the
quality of the products being manufactured and sold to the public. The COO also helps the head
of the organization in executing the mission and vision of ParaLink by utilizing his judgement,
vision, management, and leadership skills. The COO must undertake the responsibility of
optimal resource allocation to gain the maximum value of the company. It is extremely important
for the company’s success to have a COO that is great in time-management as well as decision
making.

Being assigned as the Head of the Marketing Department, he must exhibit exemplary
communication and interpersonal skills to effectively reach out to the target market and segment
the company wants to primarily utilize. Since the competition in the market is high, disruption
and innovation go hand in hand with his ability to successfully position and plant ParaLink to be
able to be seen as a demand; he should keep in mind that to be able to successfully market the
product, transformation, reinvention, and leadership will play a major role. Mr. Anton Tabora
must have an experience in running, organizing and designing successful marketing strategies
and campaigns. Knowledge regarding web analytics, editorial designing, and creation of
publicity materials is also needed. It will also be essential for the company to have a marketing
head that is updated with the current trends in the popular culture and media.

Every organization requires both operational and programmatic support; in order to

develop the well-being of an organization, especially its financial facet, the Chief Financial

10
Officer (CFO) fill in the responsibility and is tasked to provide financial projections and
accounting services, prepare growth plans, and direct its staff. Heading the daily financial
operation of the company is Mr. Ron Medina, ParaLink’s Chief Financial Officer (CFO), and has
the primary responsibility for managing the company's finances, including financial planning,
management of financial risks, record-keeping, and financial reporting. His accounting skills is
exceptional and certainly knows the company's financial status and how to keep the company
profitable and sustainable. He is deserving of this position because of his past background in
accounting and his understanding of the financial world.

Figure 4: ParaLink’s Chief Financial Officer

As the Chief Financial Officer of ParaLink, he must able to ensure the company is always
generating income in a daily basis and the company’s assets must exponentially grow year by
year. It is vital that he will set a certain percentage growth target per year and must strategize and
cooperate with other departments to successfully reach those goals in the time said. Asset and
debt management would be another of Mr. Ron Medina’s main responsibility and should always
keep the company afloat in terms of financial status. He is the one to decide on the business’s
financial approaches to be implemented that must cut across the entire business, reaching the
established goals of ParaLink. The Chief Financial Officer will have the primary day-to-day

11
responsibility of monitoring cash balances and cash forecasts, arranging for debt and equity
financing, maintaining banking relationships, and reporting financial results to the authority.
Financial projections and forecasting are a task he must accomplish, and this will provide the
company the right set of expectations coming into the future.

Figure 5: ParaLink’s Human Resources Department Head

The Head of Human Resources Department guides, manages, and provides strategy on
the people function for the entire organization. It is the fundamental role of the HR Department
Head to develop the company’s culture and reputation by effectively training employees to reach
their potential and encompass the company’s mission and vision statement. Mr. Paolo Nicolas
will be named the Head of the Human Resources Department of ParaLink and will be who given
the responsibility to the promotion and implementation of human resource values by managing
human resources programs and directing its staff to cohesively work towards a certain goal. It is
expected from him to take a leadership role in developing a culture that enables employees to
perform in accordance to the company’s objectives. He will be taking the lead in executing
policies and programs for the improvement of performance and satisfaction of the employees.
The Head of Human Resources Department is a very crucial position that need scrupulous

12
attention to detail and exceptional decision-making skills given that it controls the manpower of
any organization; because of this, filtering candidates for this position with the guidance of
certain qualifications is extremely important.

Mr. Paolo Nicolas would also be named and held accountable for the duties of being the
Head of the Information and Technology Department. His primary responsibility in this
department of the company is to oversee all the technological operations and to evaluate them
according to the mission and vision statement of the company. This position entails the
maintenance of information technology strategies by managing staff, researching, and
implementing technological strategic solutions. He is also responsible and accountable for the
consistent running of computer processes and systems with optimal speed and efficiency and that
these should be within the limits of requirements, specifications, costs and timeline.

The company believes that Mr. Paolo Nicolas is capable of managing two positions as he
is also good in multitasking and is efficient. Since he has a fair share of expertise in two different
departments, this enhances his versatility in the field of business management; fulfilling the
responsibilities demanded by separate divisions enables his to utilize her organizational skills
comprised of personal efficiency, time management skills, and the ability to prioritize competing
demands.

The company’s mission-vision statement is “Create quality aesthetically-pleasing

innovative products that provide customers convenience and satisfaction with a goal of
improving the well-being of people and linking them to the future”. This emphasizes that
ParaLink is a company that is all about giving customers quality experience by giving them
innovative, timely, and aesthetically pleasing products that provide customers a way to improve
their current state of well-being. ParaLink’s company slogan is “Your Link to the Future” and
this encompasses the mission-vision statement in a much shorter context. ParaLink offers only a
file folder that can be transformed into a pillow and vice-versa in an instant that will help in
reducing stress and pain and give customers the luxury of sleep or rest which one of the most
vital functions for survival but in the near future more products will be expected to launch. It is

13
the company’s utmost priority to be able to offer a plethora of other quality products that link the
future to the people in the most innovative way possible.

Compensation and Ownership

Compensation
Every employee hired by the business will be fairly compensated. Everyone is given
monthly salaries, that will serve as their compensation for the services they have rendered to the
company. The monthly compensation of every employee is determined by the Board of Directors
and approved by the Chief Executive Officer. The pay that the employee will be receiving is in
accordance with the laws promulgated by the government and the employee’s employment
contract with the company.

The management team of ParaLink will all be granted equal ownership in terms of
partner shares which means each board member will receive a 25 % equity stake in the company
and will all be granted limited liability in the business. The compensation for each of the board
members will be equal in terms of what the company’s generated income will be but in term of
the salary of each board member it will vary according to the position they hold in the company.

POSITION SALARY

Chief Executive Officer PHP 500.00

Chief Operating Officer and Head of the PHP 450.00

Marketing Department

Chief Financial Officer PHP 400.00

Head of the Human Resources Department PHP 400.00

and Information and Technology Department

Table 1.1 Breakdown of the Compensation of Executive Officers of ParaLink.

Shown in Table 1.1 is the breakdown of the compensation of ParaLink executive officers.
Increases in salary can be further coordinated with the Board of Directors and Chief Executive

14
Officer. ParaLink has observed government regulated laws for the protection of laborers such as
the Labor Code.

Ownership
ParaLink is a manufacturing business with limited partnership as the type of ownership
and structure. The business is viewed as a manufacturing business because its operations involve
the gathering and sourcing of materials to be transformed into its introductory line of product.
The organization is a general partnership, composed of partners who take a dynamic role are in
the everyday administration of the business. As a general partnership, all partners also share the
same unlimited liability and claims of the business.

Capitalization

NAME PARTNER SHARE

Arvel John J. Bansil PHP 12,000.00

Ron Edward G. Medina PHP 12,000.00

Paolo Ian U. Nicolas PHP 12,000.00

Antonino N. Tabora PHP 12,000.00

Julius Raphael C. Tenorio PHP 2,000.00

TOTAL PHP 50,000.00

Table 1.2 Investments of the Partners

As mentioned by Nykiel (2017), a general partnership is a business owned and run

equally by general partners who share responsibility for the business’ profits, losses, debts, and
management. To begin operations, all partners agreed to invest and raise an amount of PHP
50,000. This amount will serve as capital for the manufacturing of its products. Given that each
has invested in the company, each founding partner shall be given a 24% share in the business’
charges and earnings while the company’s key advisor and the fifth member of the Board of
Directors, Julius Raphael C. Tenorio is given a 4% share in the company. If a partner wishes to
withdraw from the organization, an appraiser shall be given the decision on the cost of the
partnership interest.

15
 ParaLink decided that PHP 50,000 would be enough to jumpstart the start-up business
and that includes all the operating expenses and cost of sales for at least the first few months of
operation. If the working capital is not enough to sustain the business model, then the partners
would be willing to add additional investment in order to continue business operations and
creating relationships and capturing value from customers.

Board of Directors/Advisory Council

Name Citizenship Address Contact No. Email Address

Arvel Filipino Amberwaves St., +63 908 888 arvel_bansil@dlsu.edu.ph

John J. Barangay 2267
Bansil Telebastagan,
City of San
Fernando,
Pampanga

Ron Filipino 6845 Milagrosa +63 915 979 ron_medina@dlsu.edu.ph

Edward St., Clarmen 3920
G. Village,
Medina Barangay San
Isidro, Paranaque
City

Paolo Filipino 40 B, +63 916 303 paolo_nicolas@dlsu.edu.ph

Ian Luxembourg St., 0938
U. Barangay Don
Nicolas Bosco, Better
Living
Subdivision,
Paranaque City

16
 Antonino Filipino 15 Imelda Street, +63 905 321 antonino_tabora@dlsu.edu.ph
N. BF Homes 4585
Tabora Almanza Dos,
Las Pinas City

Julius Filipino One Archers’ +63 943 010 julius_tenorio@dlsu.edu.ph

Raphael Place, 2311 Taft 8035
Tenorio Ave, Malate,
Manila, 1004
Metro Manila

Table 1.3 Board of Directors of ParaLink

The Board of Directors of ParaLink is composed of five (5) students namely Arvel John
J. Bansil, Ron Edward G. Medina, Paolo Ian U. Nicolas, Antonino N. Tabora, and Julius Raphael
Tenorio. Mr. Julius Tenorio serves as the key management advisor of the company. The five of
them are the duly elected officers by the founders tasked to supervise, monitor and oversee the
business operations of the company. The Board of Directors are held responsible for making
strategic decisions for the welfare of ParaLink Co. For urgent matters concerning the business
and emergency situations that need to be discussed by the Board of Directors, they can be
contacted by sending a letter to their address, calling their cell phone numbers, and/or by mailing
them an email in their respective email addresses that are listed on Table 1.3.

Contracts and Franchise Agreements

This section of the business plan has within it the fundamental contracts that will show
ParaLink's obligations and conditions. Furthermore, the company's other agreements such as in
terms of franchise will also be presented for future transactions that would give access for the
company to become more dominant in its industry by means of investors and future
incorporators.

Employment Contract
Through this contract, all the terms and conditions to be met for hiring employees for
ParaLink will be presented. Bound to this contract will be the agreements made by both the
employer and employee. This includes the lease of employment, position and job title, salaries,

17
benefits, and the rules and regulations to be observed by the employees while working for
ParaLink.

Partnership Contract
Through this agreement, the responsibilities of each partner within the business will be
defined. Examples of these responsibilities are: voting power, shares, tax obligations, ownership,
and capital share.

Retail Distribution Agreement

The retail distribution agreement contains the by-laws and regulations of ParaLink.
Examples of these are its scope and limitations, and acquisition costs. Also present in the
contract is the terms to be respected by the company with regards to the selling and distribution
of their products.

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Organizational Chart

Figure 6: Organizational Structure of ParaLink

For a business to smoothly and properly operate, it needs an organizational structure that
was well-built and thoroughly conceptualized. Companies without an established organizational
structure often face problems in implementing policies and procedures and operating at efficient
production levels. Therefore, ParaLink will be divided into five departments namely: Financial
and Accounting Department, Marketing Department, Strategic Operations Department, and
Human Resources Department as illustrated in Figure 6 The primary reason in diverging the
companies into different clusters is to delegate and accomplish the tasks in a more supervised
and focused manner.

ParaLink will be following a top-down approach in implementing policies and executing

business operations; this means that the initial commands and decisions will come from the
officers at the top of the organizational chart and will be ordered to the different departments at
the bottom. The Board of Directors, given the highest position in the company, will relay all their

19
decisions and concerns to the Chief Executive Officer since the CEO and the President of the
Board shall work hand in hand. This information will cut across the divisions and will be taken
into action. To give light to the purpose of each department in ParaLink, the functions of these
divisions are explained in the final part of this chapter.

FINANCE AND ACCOUNTING DEPARTMENT

The finance department is expected to record all day-to-day transactions of the
business, as well as prepare financial statements for the company. Through the supply of
financial statements for the company, the managers as well owners will be able to create
strategic decisions for the profit of the business. It is to be noted that the finance
department covers even the simplest of accounting tasks such as bookkeeping.

The most valuable asset to be observed by the finance department is cash. This
mostly involves the cash flow of the business throughout each transaction made. It is the
duty of the finance department to make sure that the cash flow of the business is to not go
beyond the expected outflows. Through this, the cash of the business is to be preserved.
This area also monitors the credit and collection of cash from its market

The finance department is responsible for the handling of advice in long term
financing. This mostly involves exchanges of funds and possible actions that will
increase the value of cash for the business. It is to be noted that financing may be
obtained from the bank and possible future investors. The finance department is also to
be expected to provide information to assist managers in order for them to be able to
make strategic decisions that are to determine the future of the business.

MARKETING DEPARTMENT
The image of the company is to be molded by the marketing department. The marketing
department is also responsible for the display of what the company stands for as well as customer
relations. It is also to update its customers consistently on new products throughout the
company’s yearly operations. It is the main goal of the marketing department to disburse
information to the company’s market.

20
 It is to be noted that with respect to the growing and evolving technological world, the
marketing department is to be expected to quickly adapt to these changes. With this, the
marketing department is to be able to create means in which cater to these changes while still
promoting products of which the company is selling. These means are also expected to be able to
capture attention of the customers. With that regard, the marketing department is also expected to
manage the social media accounts of the business. This is because majority of the business’
target market possess at least a single account on one of the platforms.

Lastly, the marketing department is expected to conduct market and marketing research
for the business. The information to be gathered will be of great value when the managers are to
take further actions to grow the business. Other than this, it will also create a more
understandable scope to how the customers see the products offered to them, and thereby
informing the owners of what must be done in order to produce the most desired products in the
industry.

STRATEGIC OPERATIONS DEPARTMENT

The strategic operations department oversees majority of the operations of the business.
This department is expected to have proper knowledge on ongoing trends as well as how to
predict future trends, and the ability to meet customer demands. They are expected to manage the
materials of the business as well as how work is to be done; this is in order to match the
expectations of the target market.

The operations department is expected to guarantee the best of products to be produced

by creating a functional and efficient set of operations to be done. It is to oversee the day-to-day
operations of the business, through this they will manage to evaluate the flow of operations with
their main objective being efficiency and profit through reduced operational costs. In the end, the
department is expected to conduct quality checks of the final product itself in order to spot
defects in both the product and in its production. Through this the operations of the company as
well as customer value would be met by the expected standards.

21
HUMAN RESOURCES DEPARTMENT
The human resource department is to be in-charge of the recruitment of new employees
mainly for tasks that have not yet been filled by current workers of the business. The recruitment
follows a simple three (3) step procedure: Opening of positions that are to be advertised, evaluate
applicants, and hire said applicants are meet the company’s standards and needs. Other than
recruitment, this department is also expected to handle disputes or conflicts between employees
in order to have a safe working environment. Through this sense of security, the job satisfaction
of the employees is to be met.

The human resource departments are also expected to monitor the operations of its
employees. This department is also authorized to provide compensations and benefits for the
employees as long as the reasons are justified. Through these compensations, the outputs of the
employees are expected to be at their highest, satisfying both the company and its customers.

It is to be noted that the operations of this department are to be based on what is

applicable according to the laws on labor. This justifies most of the tasks handed to the
employees and guarantees a safe working environment for an individual. The human resource
department is also expected to conduct training programs for its employees. Interaction among
workers will be encouraged as well as the outputs of each worker is to be grown. Through this,
the final outputs of the business will reach a higher quality and manage to satisfy a larger market.

Since each one of these divisions have specific functions to perform inside the company,
they are the ones held accountable if something went wrong in their scope. Every action or
adjustment that will be made in just one department will surely influence the processes in other
departments; this is why the divisions of ParaLink makes sure that every department head is
well-informed regarding the changes that one makes. The department heads should regularly
report to the Chief Executive Officer regarding the concerns that were initially addressed by the
Board of Directors. This process reflects the importance of having an organizational structure;
following the top-down approach in management, a system of command was put into practice.

22
 CHAPTER III: PRODUCT

Purpose of the Product/Service

BookPort aims to provide students an ergonomically sustainable position while reading.
It is noticeable how many students are bringing traditional wooden book stands to school, used in
reading for a long period of time. The use of these book stands help sustain their reading
positions and lessen the strain on the neck of readers. Moreover, many students tend to find ways
in lessening the weight of things brought to school. These alternatives to backpacks include
smaller bags such as drawstring and messenger bags, file cases, and the like.

To address both this need for sustaining an ergonomic position while reading and
lessening the weight brought to school, ParaLink will introduce the BookPort to the market. It is
a bookstand that can be convertible into a file case/folder. The core benefit provided by the
product is both efficiency in terms of storage, and comfort to those who use it as a book stand.
Not only will the product address the issue of bookstand users which is portability, but it will
also fulfill expectations of file case users in functionality.

Majority of the book stands seen around the campus, mainly the library, are wooden and
bulky. With BookPort, students do not have to go through the extra stress with carrying such
stands and could even lessen the weight carried around by putting only what is needed inside the
BookPort. The product is not an actual day to day necessity but would greatly affect the student’s
weight of items carried daily. A book stand’s main purpose is to alleviate neck issues while
reading by allowing to read in a position that would not need to have an arched neck and fatigued
hands.

Unique Features
The unique features that the BookPort provides is its ergonomic design mainly for
students who study for extended periods of time. It is a different take on the traditional book
stands students have, mainly because of its material. Instead of being wooden the main fabric
material to be used is leatherette otherwise known as synthetic leather that contains pockets
which acts as a means of storage the students may use to place their papers in. Going further into
detail on its storage capabilities, the size of the BookPort is 8.5 by 11 inches large enough to
23
carry papers the size of a short bond. The stand is designed to hold books as thick as two inches
and as tall as 12 inches.

To be able to appeal to a larger market, the BookPort will be designed in such a way that
it both satisfy needs of book stand users and provide functionality with its convertible into a file
case/folder feature. The colors that will be produced is based on the usual colors for file cases
and folders which are Jet Black, Leather Brown, Burgundy Red and Midnight Blue. There is also
room for inclusion of other colors as the business progresses and a demand for other colors
presents itself. Another unique feature of the BookPort will be based on the lower price that will
be set against competitors. Another company produces a similar product but the BookPort can
compete against it by offering the same benefit for a lower price.

Stages of Development
The idea for the BookPort was created from the use of book stands by students in various
universities, including De La Salle University. These book stands are used to provide comfort to
students who read a lot of books and other reading materials for a long period of time. It is also
noticeable that many Lasallians bring file organizers to school as a substitute for a bag. These
file cases serve as storage for papers, notebooks, pens, and power banks. Because of the trend in
lessening the weight of things that are carried to school, the proponents developed a product that
would combine file cases with bookstands to completely lessen the weight brought compared to
bringing the traditional wooden book stand. The BookPort serves the functions and features of
the two products including additional features that the market would prefer such as
personalization of the product.

After the final decision of the BookPort as the final product, research was conducted to
evaluate feasibility and research on processes that will be needed to create the product. A
meeting with the manufacturers and sourcing of materials was done in order to determine the
most effective way to use existing capital to match with the desired cost and pricing. The
feasibility of the product was also investigated through a survey questionnaire. The target market
and segment were identified, and certain strategies were formulated in order to reach them.

24
Below is an Idea Generation Flowchart that was used as guidance in coming up with the product
idea and planning of activities.

Figure 7: Idea Generation Flowchart

Future Research and Development

ParaLink is in its first year of business. Because of this, there are certain limitation in
terms of its operations and products. There is also an expected difference in market trends as
time goes by, and ParaLink will remain observant for these changes. The introductory product of
the company, the BookPort, also has certain limitations that can be improved in the future. As
ParaLink continues to progress, it expects to be able to produce products under the product line
of folders which would enhance the user’s work experience. Users of these items can also change
and grow in number. At the moment, the BookPort caters to users of bookstands which are
mostly students. As the product line grows, more needs of varying kinds of people can be
satisfied and it will result to a larger market and profitability for ParaLink.

In terms of product specifications, ParaLink aims to improve its efficiency for storage,
functionality and design according to current trends. It will enable our products to store more
items, lightweight and easy to carry, functional, durable, and aesthetically pleasing. All of which
are characteristics of file cases or folders that customers usually consider in buying these items.

25
Trademarks, Patents, Copyrights, Licenses, Royalties
The company will apply for the following in the Intellectual Property Office;

Brand Name
ParaLink’s BookPort, an ergonomically designed bookstand that multi-functions
as a file folder. The brand name is to give emphasis on the idea of being a portable
bookstand for the customer’s comfortability upon reading books and convenience with
bringing their papers for their everyday endeavors.

Brand Logo

Figure 8: Brand Logo

Government Approvals
The company ParaLink has decided to take on the title of a business a step further and not
remain just a simulated business. ParaLink will be registered as a Partnership (Limited) company
with its business partners being: Arvel Bansil, Ron Medina, Paolo Nicolas, and Anton Tabora.
The business documents and permits are to be registered by the Securities and Exchange
Commission (SEC). Through this, ParaLink will receive a certificate of registration that would
allow the company to begin operations. ParaLink must also secure a mayor's permit before the
operations begin. With respect to its operations, the company will be having taxes collected upon
sales which are to be filed by the Bureau of Internal Revenues (BIR). All permits and
certifications are going to be filed in the government offices of the city of Manila, Philippines.

26
Product Limitations
The product is very specific in its purpose and features to a defined market. It caters to
the needs of students who read books often and bring file cases or organizers to school. Because
of this, the product is limited to certain functions that does not fit with the needs of everyone in
the entire student population.

From a perspective outside the desired market segment, the product will be limited to
students who often read. These people are more likely to be interested in using bookstands if
they have not used it before. Their reading habits are caused by a lot of factors such as
personality, ingrained interest in reading, and/or a need for extensive reading in the case of
students. These factors can also be considered as limitations toward their need for the product.
Electronic books or e-books can also replace traditional books and can be used by these readers.
However, the product remains functional to these types of readers because e-book readers,
tablets, and other gadgets can be docked in the book stand and serve its purpose.

In addition, the product also cannot cater to students who bring a lot of things to school.
This is because file cases/folders are used to minimize the things brought, and those needing a
large amount of storage will opt to use a bag or backpack instead. However, this is not entirely
bad because there is a number of backpack-using students who also use file cases/folders to
organize their important documents. This product is to serve only as an accessory item to a
customer current items brought to school.

Product Liability
The product holds little to none with respect to liabilities. It is a simple school supply
accessory that is lightweight and could be carried around effortlessly. The materials used in
producing the product are also biodegradable, meaning the final product itself is not harmful to
its environment even when disposed. With that regard, ParaLink will not be held liable for any
misuse or improper disposal of their products.
ParaLink will not be liable for the following:
a. Damages after customer use of the product - There will be no refund, replacement or
allowance given to customers whose products have been reportedly damaged or

27
 mishandled under their care. However, it can be considered if the duration from the date
of purchase fits in the warranty period.
b. Returns after the given 7-day warranty period - Request for returns and exchanges will
not be honored after the allotted warranty period. As stated in Article 68 of Republic Act
No. 7394 or the Consumer Act of the Philippines, retailers have the freedom in
establishing guidelines for warranty and replacement. However, consumers must also
provide necessary information and documents such as the proof of purchase. ParaLink
will also make sure that customers are aware of the warranty policies upon purchase.

Related Products/Services and Spin-Offs

The product is currently part of the Office and school supplies industry. Therefore, there
are a lot of products that are introduced and are currently in the market which are similar to the
benefits that BookPort delivers to its customers.
The following products are similar to the BookPort:
a. Book Stands
- Book stands are commonly used by students who read in large amounts of time. This aids
the students in sustaining an ergonomic position while reading.
b. File Cases/Folders
- File cases and folders are widely used by Lasallians for different purposes. While some
use it as compartments for important documents, others opt to use it as replacement for
backpacks because it is easy to carry and much more miniature.
c. Laptop Bags
- Many students opt to bring laptops instead of notebooks and other note taking materials.
This is because laptops can also be used for readings and many other purposes. Not only
does this reduce the need to bring a notebook, but it also compresses all needs into one.
Laptop bags and sleeves are also being innovated to cater to other needs for storage.

As ParaLink continues to grow, products other than folders such as laptop or tablet cases that
students can use in school which can also store papers will be developed. ParaLink will also be
open to customer feedback and suggestions. The company envisions creating similar products
and expanding the product line by offering more innovative combinations of products that are

28
already currently offered separately. This is for a more proper assessment on the demand of the
customers, and to improve customer relations.

Production

Production Process

Figure 9: Production Process Flowchart.

Labor Requirements
The labor shall be equally divided among the current members of the company, ParaLink.
Based from the Production Process Flowchart, the activities mentioned would require attention.

Company Member Activity Description Member Assigned

Arvel Bansil Supply Gathering The member assigned Arvel Bansil & Ron
to this shall look for Medina
the main supplier and
possible substitute
suppliers (if
necessary) to
successfully mass
produce BookPort.

Ron Medina Product Assembling The member assigned Ron Medina & Paolo
shall overlook the Nicolas
whole product
assembling of
BookPort as guidance
and if it is being done
right.

Paolo Nicolas Quality Inspection The product made are Arvel Bansil &
inspected if it shall Antonino Tabora
pass as a quality
finished product to be
sold to the market.

Antonino Tabora Packaging The products to be Paolo Nicolas &

29
 sold are then Antonino Tabora
packaged and the
member assigned
shall inspect the
packaging if it houses
the product properly
and safely.
Table 2.1 Distribution of Labor

Production Output
The company aims to successfully produce 100 units of BookPort in its startup selling
and will not go any lower than 80 units to be produced and sold. Production is based on the
material to be bought by the supplier. If the material is bought in a bulk larger than the goal units
to be produced, the company shall not exceed a maximum of 140 units of BookPort to be
produced. Cost is inclusive of delivery to the headquarters of ParaLink.

Costs 350 PHP Per Unit

Goal Output 100 Units 350 PHP * 100 units = 35000 PHP

Minimum Output 80 Units 350 PHP * 80 units = 28000 PHP

Maximum Output 140 Units 350 PHP * 140 units = 49000 PHP
Table 2.2 Production Output Goals

Facilities
ParaLink is new to its industry, and with that regard it is to be expected that its facilities
are to be of little amount. For retail purposes, ParaLink will be stationed on a booth in the
Yuchengco lobby, which is located in De La Salle University. Other than a station for retail, the
company will have its manufacturer’s factory in order to perform the production of its products.
This factory is located in Binondo, Manila. Lastly, the main office of ParaLink will be located in
WH Taft Residences Floor 18 room G. This location serves as the main office by how
geographically close it is to De La Salle University, where the selling of its products is to take
place. It is to be noted that this location also has access to multiple modes of transportation and is

30
in vicinity of multiple malls which may soon serve as future outlets for sales. This condominium
unit is owned by one of the founders, Arvel John Bansil, as supported by a lease.

Suppliers
ParaLink decided to have only one supplier for the whole product because BookPort
cannot have separate parts from different suppliers. Various possible suppliers were sourced
from existing businesses that offered or manufactured similar products to the BookPort. After the
process of pitching the design and idea to different manufacturers and finalizing the
specifications regarding the materials to be used, ParaLink decided to go with EMG Enterprises
as the manufacturer for the BookPort. The design was accepted, and certain agreements were
made. There are no backup suppliers because management does not think that a backup would be
needed as of the moment. Significant purchasing contracts are shown below.

EMG Enterprises is a family owned company based in Metro Manila that specializes in
making souvenirs. ParaLink finds EMG Enterprises as the best choice because they are open to
cater innovative designs and ideas for new products since they are a souvenir making company.
Below are the supplier details.

Name of Supplier Address Contact Person Contact Number

EMG Enterprises Binondo, Manila Mrs. Ritz Go +63 916 765 4896
(Owner)
Table 2.3 Supplier Details of the BookPort

Environmental Factors
Much like all plastic based products, BookPort appears to be dangerous to the
environment. However, ParaLink ensures that all processed BookPort finished products are made
with the finest of quality which makes the product last long periods of time and therefore keep
waste and disposal at a minimum. Also, leatherette does not harm any animals in the process of
its making which makes BookPort an animal-friendly product and this avoids the disposal of
excess animal waste. However, even with the durability of BookPort, if the product is improperly
used, the product may break and result to its quick disposal and deal damage to the environment.

31
 CHAPTER IV: MARKETING PLAN
This chapter presents the analysis of the School and Office Supplies industry in the
country and in the current market where ParaLink will operate. Moreover, a target market has
been identified to be the basis of marketing strategies that will be employed. This will enable the
company to communicate effectively the market being targeted.

Industry Profile
ParaLink, along with bookstores, stalls, and other companies that manufacture and sell
supplies that are used in school and in the office are under the School and Office Supplies
Industry. Even though one might say that the industry is seasonal, it continues to be a dynamic
industry because of the consumable nature of most products that this industry includes. In fact,
MarketGate (n.d.) notes that the back-to-school shopping season is the second-largest seasonal
shopping period of the year in terms of consumer spending.

Current Size
ParaLink is under the School and Office Supplies industry, which is an extremely large
industry in terms of its scope of products. The company is offering a book stand that also serves
as a storage for papers. If looked more into detail, the industry of book stands is actually small
where majority have similar design, but for paper storage there is a wide variety made for almost
anyone’s preference. With the product being a file-folder bookstand, not only does it enter the
industry of paper storage or bookstands, but also the industry for folders in terms of additional
compartments which holds other school/office everyday items such as ball pens, pencils,
calculators, etc.

Growth Potential
With respect to the growing number of readers each day, as well as students, the number
of buyers is constantly increasing. BookPort is a taking a new design to the visibly present
industry, the growth of the product in the industry is most likely to be stable. Using the data
gathered from the survey form given out, it was also found that most of the respondents read
books and felt discomfort while doing so. Considering that e-books exist as a way to keep up
with the advancement of technology, bookstands may also be of use to mobile devices such as
cellphones & tablets. This also tackles the use of cellphones and tablets for the viewing of videos

32
and/or films which may serve as a stand to ease the viewer’s use of hands and bowing of head as
they watch. With e-books, videos/films as part of technology, BookPort may be of use for the
years to come.

Geographic Locations
BookPort is a product that is mostly used by students because of their need for reading in
large amounts of time. Its convertible function as a file case/organizer can also be used by
students because of their habit in using these products as storage for important documents.
ParaLink will focus on the National Capital Region or NCR because this is where the School and
Office Supplies Industry thrives. Most offices are located in certain cities from this region and
there are also a large number of schools in this region, both public and private. Below is a picture
containing the cities within the NCR.

Figure 10: National Capital Region.

The Commission on Higher Education (2018) stated that there are currently 2, 981,803
students enrolled in higher education. In addition to that, the University Belt is also located in
NCR. The term was coined because of the high concentration of universities in the area.

Industry Trends
ParaLink currently belongs in the school and office supplies industry. Trends have
remained consistent without any major changes in its recent years. As the founders are students
of De La Salle University, a trend noticed through observation would be how the students limit

33
their supplies to only what is needed for daily activities. The students who tend to pack light
often choose to carry a file folder rather than actual bags. Students who study using books often
have a bookstand being used as the text is being read. Trends in sales often rise during the start
of the academic season. There are multiple companies that supply products that fall under both
school and office supplies as a classification.
The switching cost of the buyers are low, resulting to a high threat to the business.
Although the product is unique compared to most products, there are also a number of products
that can provide the same benefit but in a different manner. With that being said, substitutes may
appear to have a high attractiveness to the buyers, but once the factor of how BookPort provides
all through a single product, it would be safe to assume it is to stand out in its industry.
With respect to the technological advancements going on in the industry such as innovative ways
to efficiently store school supplies, and with attention to the technological advancements of this
era, it is expected that future trends would involve major deviations from the traditional supplies.
An example of a technological trend would be the conversation to electronic books that are to be
used during classes.

Seasonality Factors
The School & Office Supplies industry would bloom the most during back to school
seasons. With BookPort having the main target audience of students, back to school days are
when students buy their new books for the new academic year to come as well as look for
supplies in office/school supplies stores. Catching the eye of students buying new supplies,
BookPort makes a great combination for their new set of books to be used in their everyday
endeavors in school. Although it could pass as a leisure item for regular book readers, majority
of its market is on students who would mainly use it for school. Adults from family vacations are
most likely to go back to work as well. This opens the opportunity for office workers who use
bookstands in presentations or simply to hold their paperwork to make use of BookPort.

Profit Characteristics
Since the target market of the company are mainly students, most of the profits would be
based on the student’s allowance. The company shall aim to sell BookPort at the lowest price
possible fitting for the average allowance of a student based on the survey we conducted.
However, as we attempt to give way for students to be able to purchase this product, ParaLink is

34
still subject to change its prices if necessary to achieve its goal profitability or to reach its break-
even point.

Distribution Channels
The current businesses under the School and Office Supplies Industry commonly use a
one tier approach in their distribution channels. This includes stores like National Book Store
and Expressions, as well as stores that are commonly found near school campuses. In a one-tier
approach, the manufacturer sells its products to a retailer. The retailers are the main distributors
of the products to the users. The retailers usually buy products from manufacturers so that these
products can be named after their specific brand such as Best Buy of National Book Store. Some
manufacturers also employ a direct approach to distribution and serve as distributors as well to
customers or end users.

Basis of Competition
ParaLink bases its competition for the BookPort with 2 factors: its main purpose and its
benefit. For the competition in book stands, it threats of other competitors are not so high. In
contrast, the competition for storage is high due to the sheer amount of designs other products
have. Explaining further in detail for the competition of storage, many products in the industry
sell file-folders of different sizes and compartments for additional storage not limited to paper.
Also putting into consideration, the competition into creating the base of file-folder itself in
terms of durability, design, and weight. According to the data results of the survey questionnaire
based on 120 respondents, 27.5% (33 respondents), 8.3% (10 respondents), and 19.2% (23
respondents), of the respondents considered durability, aesthetic designs, and lightweight,
respectively. This gives the product a lot more things to consider into pushing through with
BookPort against its competitors in the perspective of storage.

35
Competition Profile

Porter’s 5 Forces
High Competitive Rivalry
For the industry of School & Office Supplies, there isn’t much difference in every
product being sold. The number of unique features that every product can contain is usually
similar in some way to another product being sold by other companies. For example, BookPort
has only the unique feature of the bookstand and most of the other features are common among
products such as more capacity, lightweight, appealing design, etc. Having also different
companies in the industry of School & Office Supplies, both local and international, we the
competitive rivalry of the School & Office Supplies industry is high.

Strong Supplier Power

ParaLink is in continuous search of suppliers, but there is still difficulty in finding quality
suppliers for BookPort. If the main supplier of BookPort attempts to increase its price or has any
decline in production, ParaLink may need to adjust to their price if they fail to look for substitute
quality suppliers, thus, the strong supplier power.

Weak Buyer Power

With the very minimal to no competition in file-folder bookstands, buyer power is
considered to be weak. Even though there are many other file-folders or bookstands in the
market, there isn’t any competition to the combination of both. Buyers of BookPort does not
have much choice when trying to attain of such a product if not ParaLink’s BookPort.

Strong Threat of New Entry

With School & Office Supplies being quite feasible in being produced, it is very much
possible for new competition in the market as time passes by. It does not require much skill to
create such products and there are many other similar designs that can be produced and become
competition for BookPort. The costs for starting a company based on the Office & Supplies
industry is not that high as well making it easier to enter the industry competition.

36
Strong Threat of Substitution
The bookstand being the main product of BookPort and not the file-folder, there are
many other ways to make a book or tablet stand. Also, in the aspect of the file-folder for
BookPort, there are many other products with more focus given on the capacity, design,
durability, that BookPort may be deemed inferior to. There are also other bookstands much more
sturdy or bigger in size that may support bigger books which may cause the market to lead to
individual bookstands instead.

Customer Profile

Demographic Segmentation
Age
Majority of the current available market of ParaLink’s BookPort are students for reasons
that are specific to the age groups that they belong to. These include Senior High School,
Undergraduate, and Graduate school students. While Senior High School and Undergraduate
students are usually between the ages 16-18 and 17-21 respectively, Graduate school students are
included in various age groups. However, most of the Graduate school students who often read
are young professionals that are aged between 21-26. Therefore, these age groups will be mainly
considered in employing marketing strategies. It is also important to note that the product will
also be available for purchasing online. People who belong to these age groups are well
acquainted with technology and are more likely to buy online.

Gender
ParaLink does not consider gender as a consideration in marketing its product. This is
because gender does not have relationship with the buying behavior of the market towards book
stands and file folders. The business will provide an equal number of variety and choices to any
gender.

Occupation
The users of book stands are students. Even though reading habits vary from each
student, the market research conducted shows that almost all students believe that book stands
will help them specifically in maintaining a sustainable and comfortable position while reading

37
whether it might be for leisure or a requirement. Majority of the buyers of file cases/folders are
also students who use them in organizing school papers and other important documents. De La
Salle University is a good start-up market to sell the BookPort because of its large student
population.

Income
The target market of ParaLink are students from senior high school and college. Because
of this, the money available for spending is from the allowance given to them. As students, most
of the allowance go to varying needs and wants, including school-related expenses. For some,
cost of living expenses is also an additional. From the market research conducted, it can be
concluded that most members of the target market only have a certain amount that are allocated
for purchasing unsought products such as the BookPort. However, because most have enough
savings based from the expenses and allowances, there is a potential for sales from these people.

Education
College students, including Undergraduate and Graduate, are more likely to use book
stands because of the many reference books that they are using to aid in their academics. The
senior high school students are also potential customers, but ParaLink will focus on marketing
the product to college students because of their increased.

Personality
The personality types to be recognized by ParaLink as their market are: The aspirers, explorers,
and mainstreamers. Aspirers for the aesthetic vibe that BookPort provides upon usage. Explorers
are for those who are willing to take upon the chance to try the new product, and Mainstreamers
for those who seek the convention and values to be provided by the product.

Behavioral Segmentation
Usage Rate
In terms of light, medium, and heavy users of the product, majority or ParaLink’s customers are
to be expected to fall under the medium users. Although there will be a significant amount in the
light users, these people are classified under medium for the reason being how the product can be

38
utilized. Even with the user not using BookPort to hold a book up, the user will also most likely
use the product as a means of storage for the papers they carry.

Benefits Sought from the Product

ParaLink’s market for the product BookPort revolves around its main benefit being its
ergonomic design for the user. The benefit of comfort and efficiency for storage would be what
is to be satisfied by the product.

Loyalty
The company is new in its industry, but in terms of the product not many competitors
have designed a bookstand that would also act as a means of storage for their paper. Through the
emergence of a new product type, the company is expected to gain loyalty from its market by
being one of the first for production. The growth in loyalty is expected to increase future sales
for the company.

Occasion
The company will aim for the following occasions to where BookPort will be purchased
most often: Beginning of each academic term for the year which are June, September, and
December. Other than the beginning of each term, the market is also to be expected to have an
increase in purchases during Christmas, as a means for gifts.

Target Market Profile

ParaLink will be targeting two (2) different market segments upon initial sales. The
primary target market of ParaLink are the all the students of De La Salle University, mostly the
senior high school and undergraduate students. Ages 16-24, including both male and female.
These students have an allowance ranging from 1000-2000 php but are willing to spend about
500-1000 php, roughly half of their weekly allowance. The company has chosen this market
because they are the ones who are most likely to purchase the product for the following reasons:
Students are most likely carrying around books when reviewing as well as papers but often do
not have a bookstand with them, BookPort was made to assess this problem. These students also

39
have the easiest access to the outlet because the initial selling of the product will be located at De
La Salle University.
The secondary market ParaLink will target would be the staff, mainly the professors of
De La Salle University, followed by students and teachers outside of DLSU. ParaLink believes
that not only students will see the need of purchasing the product, but professors may also
choose to purchase it for the need and problem it solves. ParaLink also believes that the market is
not only limited to the population in DLSU, mainly because once online selling is to take place
people outside the population may be interested as well; provided they search for the same
benefits BookPort may provide.

Pricing Profile
BookPort’s pricing shall be based on cost-based pricing. Having a production cost of 350
Philippine Peso (PHP) for every unit, ParaLink shall price BookPort at 500 PHP. This is in
respect to the 120 respondents based from the survey given which has almost 95% of the entire
respondents answering that they will go for a price range of around PHP 300-500. With this, for
every unit sold, ParaLink shall gain a profit of PHP 150.

Policies for Large Orders

ParaLink will only recognize and receive larger orders from trusted and profitable
retailers with at least a year of operation that can pay the price of a minimum order of 50 pieces
up front with cash or within 30 days. A contract and official receipt would be in place for proof
of purchase. A customer cannot purchase in bulk of more than 20 order unless he/she represents
a trusted and profitable retailer. Payments through account must be supported by a promissory
note with terms that is agreed upon by the management of ParaLink.

Sensitivity of Price
With the idea of market skimming, ParaLink shall start selling BookPort at its highest
initial price of 500 Philippine Peso (PHP) independently even if demands go higher. However,
with the possible changes in competition in the coming future of new products entering the
product, BookPort is prepared to be marked down in price. It shall also vary in terms of supply &
demand, in which if BookPort is having low demands for long periods of time, ParaLink shall
aim to at least reach its break-even point and lower down BookPort’s price temporarily.

40
Gross Margin on Products/Services
The gross profit margin below shows the percentage of profit BookPort shall generate for
the company. After calculating BookPort’s projected costs, net sales and gross profit, using the
formula for Gross Profit Margin, the company shall receive a 30% profit from the sales of
BookPort.

Gross Profit Net Sales - Cost of Goods Sold

= PHP 425,000 - 297,500

= PHP 127,500

Gross Profit Margin Gross Profit / Net Sales

= 127,500 / 425,000
= 0.3 or 30%
Table 3.1 Gross Profit Margin

Break-Even Analysis
ParaLink will order units of the product monthly which various from each month. The
break-even analysis will be based on a year of operations, specifically Year 1 and 2. This will
show how many units must be sold in a year to be able to cover total costs for each unit even
without gaining profit.

Year 1 Break-Even Analysis

Break-even Analysis

Cost PHP 297,500

Revenue 500x

500x = PHP 297,500

x = 595 units
Table 3.2 Year 1 Break-Even Analysis

41
Year 2 Break-Even Analysis

Break-even Analysis

Cost PHP 446, 250

Revenue 500x

500x = PHP 446, 250

x = 893 units
Table 3.3 Year 2 Break-Even Analysis
Based on the tables above, ParaLink has displayed 2 years of break-even analysis for
their operations. Where x symbolizes the number of units needed to be sold in order to match its
cost otherwise known as break-even. For year one, BookPort has accumulated an approximate
cost of 297,500 Philippine Pesos (PHP). With the selling price of each unit being PHP 500,
ParaLink must be able to sell 595 units in order to breakeven. With respect to the 2nd year of
operations, it is expected that ParaLink will increase in sales for the said product. With that being
said, the cost is to increase as well; it is expected to increase to a total of PHP 446, 250. The
selling price of the BookPort is to remain constant and with the same formula ParaLink will be
able to break-even at a total sale of 893 units.

Market Penetration
The strategies that will be described will highlight the methods that ParaLink will employ
for the business to successfully penetrate the market and communicate effectively to the target
market the introductory product which is the BookPort. Moreover, this will explain the important
roles of distribution channels, sales representatives, direct sales force, and telemarketing in
selling the product to the market.

Distribution Channels
ParaLink will only be introducing its first product to the market. Therefore, the expected
number of customers would be just enough for the current members of ParaLink to facilitate.
ParaLink shall use the one-tier approach for the distribution channel of the product. BookPort
shall come from the suppliers and ParaLink will serve as the intermediary to selling it to its
customers. As the first step for BookPort in the market, it shall be sold via a stall in the campus

42
of DLSU during the bazaar. However, BookPort will also be open to online communication for
different universities wishing to attain BookPort, in which the product shall be delivered to
customers who doesn’t have access inside the DLSU campus for its bazaar via meetups.
ParaLink also has a backup plan of having a delivery service via courier in partnership with LRC
Xpress if the market becomes too large for meetups. The delivery fee shall be shouldered by the
customer.

Sales Representatives
The founders of ParaLink acting as sales representative has a main objective of
increasing value for both the product and between customers. As sales representatives, they will
be the first encounters of the customers with regards to feedback and complaints. Through this,
the founders will develop the main goal of how the product would satisfy the most of its market.
The founders will serve as the sales representative and will not have anyone hired for the primary
reason of: the company is still starting. In this process the increase in salaries expenses are to be
deducted, and overall reducing the expenses of the company.
For the online selling aspect of the operations, the roles of the sales representatives will
be to handle the advertising of the product through means such as the social media platforms.
The sales representatives will also handle the interpretation of data for online purchases as well
as online feedback. Through the process of the founders being sales representatives, for both in
person and online, the founders believe that they will be able to widen their scope in marketing
tactics by understanding their market more.

Direct-Sales Force
The business will not hire new or outside sales representatives. The partners themselves
will act as the sales representatives and so the direct sales force will depend on strategies that
will be employed according to the specific plans made. This will be better for the business
because the partners have a more in-depth knowledge of the business, the product and the
strategies that will be used allowing ParaLink to build stronger customer relationships. A direct
sales force will be the primary method for distribution of ParaLink. Through this, the desired
message for the market to received will be communicated more effectively because end users or
customers can directly ask the sales representatives their inquiry right away. This method is also

43
deemed more fitted for the business because people in the target market do not usually go
directly to retail shops for unsought products and a sale can be initiated more conveniently.

Direct Mail/Telemarketing
ParaLink will also employ such marketing techniques for higher sales. Nowadays where
the internet is used as a platform to communicate messages specifically marketing
communications, the partners believe that effective marketing of our product will be beneficial.
In the market research conducted, there were some interested respondents who opted to include
their contact information for the purpose of being updated when the BookPort is available
already. When its operations start, these interested respondents are going to be contacted through
their given information. Also, other people that also express their interest toward the product will
be consistently updated through messages in various social media platforms. These people
include those who react (such as likes, shares, or comments) to any of the advertising materials
that ParaLink will be releasing. The target market, which is composed of students from De La
Salle University, can also be reached by messages in Facebook. People who react to posts in any
of the public groups composed of De La Salle University community members will be
considered potential buyers, who are to be treated with respect.

Advertising and Promotion

Since ParaLink’s initial target market are students of De La Salle University, promotional
materials are going to be focused in places and mediums where majority of the audience are
composed of them. Considering their demographics and behaviors, most students spend a lot of
time using various social media platforms. This includes Facebook, Twitter and Instagram.
ParaLink shall create posters to be posted on the mentioned social media platforms through
ParaLink’s account. This shall serve as the primary advertising tool to raise awareness of the new
product in the market, BookPort. The secondary advertising tool of BookPort shall be word of
mouth. Once the product is introduced in the market through social media viewers, the product
will be open for exposure and sharing to a much larger pool of the internet.

Packaging and Labeling

Upon initial selling of the BookPort, ParaLink will only be providing a paper bag with no
design to incase the product. Provided sales are successful and sales were to continue via online
44
selling, a portion of the profit will be placed for the creation of a cardboard box that flips open,
similar to the packaging of a smartphone. The company's logo will be placed inside the box, the
product logo will be visible in the exterior of the packaging, while the specifications such as the
color, size, and other details will be present at the back.

Service and Warranties

ParaLink shall offer its customers a 7-day warranty on full replacement of the product if
there are any defects on the product liable to the company’s fault. However, ParaLink shall try
and commence repairs and it shall only be replaced if it cannot be fixed by the company. This
warranty shall be voided if the product is tampered with, misused, or if there are any incidental
and direct damages dealt to the product by its user. Upon acquisition of the warranty, the
customer is needed to present their receipt given upon purchase of the product.

Trade Shows
The core product of ParaLink is the comfortability and convenience of frequent readers.
Because of this, the business deems that book related events and places such as book launches,
book fairs, symposiums and the like are great places to set up distribution strategies. ParaLink
will join and cooperate with small and medium enterprises in trade shows that will be held within
Metro Manila. The following are the specific trade shows that are being targeted:

1. Manila International Book Fair

- It is a yearly event organized by Primetrade Asia Incorporated that is usually held
in September. ParaLink is looking forward in joining the largest and most sought-
after book fair in the country because there is large sales potential. According to
Manila Book Fair (n.d.), the book fair visitors are regular visitors who have been
attending for an average of five years and belong to the highly educated sector of
the population. This is also a great avenue for the business to advertise and
introduce the product to a larger audience.
2. Philippine Readers and Writers Festival
- A yearly festival organized by National Book Store and Raffles Makati that offers
an exciting series of book signings, discussions, and panels about books,

45
 literature, and culture from top Filipino writers and artists, as well as international
bestselling authors (Readers and Writers Festival, n.d.).
3. Book Binge Bazaar
- A book expo that showcases books ranging from local writers to bestselling
authors. Its main proposition is the lower prices of books. According to CNN
Philippines (2018), it also includes a book signing and a question and answer
forum with the authors themselves.

Future Markets
ParaLink is currently focusing on students inside the university belt. However, being in
the industry of School and Office Supplies, our future market may extend to office workers. The
products to be made in the coming future shall be focused on combined products that offer
convenience much related to BookPort. A reason why ParaLink wishes to focus on combined
products that offer convenience is because of how these products are usual everyday items that
are very much open to any market. ParaLink is open to creating more innovative products that
focus on improving the efficiency of study and work or in other words focusing on creating
ergonomically sustainable products. Taking BookPort as an example, BookPort’s main market
would be students or bibliophiles. However, according to our survey, there are actually graduates
of law wishing to attain of BookPort as soon as possible even if it is not yet in sale. From this
basis, ParaLink sees office workers as a potential future market.

46
 CHAPTER V: OPERATING AND CONTROL SYSTEMS

Administrative Policies, Procedures and Controls

ParaLink’s Standard Operating Procedures

Receiving Orders
ParaLink will be receiving orders from both online and through the physical
booth. The online ordering procedure of the company would be accessible through ParaLink’s
official Facebook page, Twitter account, and Instagram account via Google Forms. Payment by
customers who ordered online would be through cash on delivery and if they wish for the
product to be shipped, shipping costs and freight-on would solely fall under the customer as
ParaLink will not be offering free shipping. All transactions and orders received would be tallied
via Microsoft Excel and would be reported monthly to top management for analysis.

Billing the Customers

ParaLink will prioritize customer orders on a first-come first-serve policy and will strictly
not accept non-monetary compensation in exchange of the company’s products. Payment via
Debit or Credit Card will also be accepted as compensation in exchange of the company’s
products, but customer’s will have to cover the necessary extra payments accompanied by this
payment method. The only physical currency to be accepted by the company is the latest edition
of the Philippine Peso (PHP) which is the new generation currency banknotes.
ParaLink, as a start-up company, prefers customers to be able to purchase products in
cash. Discounts on products will only be given if and only if majority of the Board of Directors
have agreed upon on it. The company will observe a policy that entails cashiers to always give
receipt and when a customer does not receive a receipt, he/she will receive a full refund of the
product in cash equivalent while also getting to keep the product.

Paying the Suppliers

ParaLink’s will strictly adhere to the term and conditions of the payment process agreed
upon by both the suppliers and the company. The company would prefer to pay suppliers upfront
right then and there to effectively and efficiently make use of the company’s funds. If in the case
that the company cannot pay the suppliers upfront, down payment of 25% and a promissory note

47
would immediately be appealed for. ParaLink would like to pay their Notes Payable as quickly
as possible and would prefer one-time payment to cover the whole debt. Payment terms would
always be negotiable and ParaLink would take terms into serious considerations to ensure it is fit
with the company’s short-term and long-term goals.

Collecting the Accounts Receivable

ParaLink will be using a collection agency to help the company in retrieving money owed
to the company. This will incorporate the company to hiring a third-party agency that will handle
all of the debt collection. This helps ParaLink be assured that the company will indeed receive
full payment of debts alongside the interest income it produced in due time. The company policy
and procedures on collecting accounts receivable would be totally dependent and adhere to the
terms and conditions set by the third-party collection agency.

Reporting to Management
ParaLink’s Management Reporting System is as follows:
1. Every report runs through a set of standardized activities and procedures in order to
ensure effective and efficient processing.
2. Each department is required to create a weekly update report for the Board of Directors to
review and act upon.
3. If the department cannot come up with a weekly update report, the Board of Directors
must immediately be informed of the reason why and must strictly be able to create the
report the following week.
4. In the case of proposals to the Board of Directors, an employee must first secure an
authorization for proposal from the Strategic Operations Department. Once approved, the
employee must submit its proposal abstract to the Board of Directors and if again,
approved, a meeting will be set for the employee to defend their proposal.
5. In the case of concerns and complaints, the procedure for the proposals would also be
implemented before getting a chance to meet with the Board of Directors.
6. Every authorized report facilitates the monitoring of services and service quality and
every implemented reporting is documented.

48
 7. Reports are classified by the following priorities: basic and superior. Basic means the
report need to be executed following in basic order, while superior means the report has
higher priority and needs to be executed in first row.
8. All reports are going to be kept in record physically and digitally for future reference.

Staff Development
ParaLink’s management will be extremely keen on staff development as it is extremely
important to uplift a healthy work environment where every employee is motivated to do his/her
work efficiently and productively. The top managers are more than willing and able to mentor
future employees and mold them into the culture of innovation that ParaLink wants to achieve.

Constant performance appraisal will be expected for well-performing employees and

additional mentorship and guidance will be given to those employees with mediocre and poor
performance. This is only applicable to future employees as currently only the Board of
Directors are the employees working for ParaLink as of the moment.

Inventory Control
ParaLink will be purchasing every month which means inventory would be much easier
to clear out due to only needing sell a set number of units per month rather. All inflow and
outflow of units from the inventory would be regulated and recorded via Microsoft Excel. Units
unsold from the prior month would be the priority units to be sold before the newly purchased
units for the following month. It will be a goal for the company to clear out inventory at year-end
and the number of units to be purchased will be decided on by the Board of Directors and will
solely base it on the sale performance for the month prior.

Handling Warranties and Returns

Employees must see to it that the product to be sold and received by the customer is of
superior quality and will be free of defects. In the case that a product sold is with defect and
issues, ParaLink will offer a full or partial refund and a replacement policy depending on the
damage or defect that the product had. A one week or 7 days warranty policy would be
implemented on all products sold by ParaLink to customers. Within this period, customers will

49
be able to appeal for either a partial refund, full refund, or replacement depending on the
circumstances of the product has. Beyond the one-month period, a customer would no longer be
able to appeal for either a partial refund, full refund, or replacement and the company would no
longer be held liable for any damage of defect the product sold has underwent.

Monitoring the Company Budgets

ParaLink’s Finance and Accounting Department would be the main department to handle,
monitor, and plan the company’s budget for the year. They will strictly adhere to the proposed
budget plan and would let all the departments know where the funds would be allocated. The
proposed budget plan would always be needing an approval from the Board of Directors before
being implemented. Non-compliance or alteration of the proposed budget plan will be not
tolerated unless the Board of Directors are informed and agreed to it.

The company would prioritize transparency on all transactions done within all the
departments. This is to ensure that every employee is aware of what and how the company is
doing. There would be written financial and transaction reports weekly sent to all the
departments for information to be disseminated and dissected properly by everyone. Once an
abnormality or concern about the budget occurs, everyone in the company is free to consult or
ask the Finance and Accounting Department for clarification.

Security Systems
ParaLink would perform internal auditing to avoid financial and legal problems for
security reasons. All cash that ParaLink has will be safely stored in either a safe deposit box or
be stored in the company’s official bank account which only the Board of Directors would have
access to. Inventory will all be stored safely in the residences of the Board of Directors to cut
costs for requiring a warehouse or storage area.

50
Documents and Paper Flow
As a registered business, ParaLink will be issuing official receipts to customers. Below is
an example of the official receipt.

Figure 11: Official Receipt of ParaLink.

An acknowledgement of every transaction is the only document needed for the business.
ParaLink will be selling in two methods which are physical or direct selling and online
transactions. The following will show the flow of each transaction and how the document will be
used.

51
 START

Identify
potential

Give Use
business marketing

No Success END
ful?

Ye
No Is Ye Record
custome transaction

Figure 12: Direct Selling Flowchart

Check for Prepare

STA and products

Receive Is
payment ther

Ship Record Get

ordered transactio contact

END

Figure 13. Online Selling Flowchart

52
Planning Chart
Product Development
The product will be ready for selling by the month of September 2018 and will plan to
continue increasing targeted sales monthly. Conceptualization of the product idea started in
March of 2018. The management team decided on how the product design will look like and
what will be its main features and functions in May of 2018 to June of 2018. The marketing plan
was concretized and finalized by the management team by August of 2018, subsequently the
product design was sent out to the main supplier, EMG Enterprises, for formal manufacturing. In
September of 2018, ParaLink’s BookPort will set out to the free market available for purchase in
four different colors and the advertising and marketing campaign will also launch. ParaLink’s
social media accounts will be up and running by the first week of September to be formally
accepting online orders via Google Forms. September onwards will be the final phase of
development, actual selling and operating ParaLink for growth and profit.

Financial Requirements
ParaLink would only be needed the capital by the month of August 2018, as this marks
the start of the purchasing and manufacturing of BookPort. From then on, a monthly investment
of PHP 50,000 will be required from the Board of Directors for the company to operate
successfully. The PHP 50,000 required monthly is not fully going to be consumed by ParaLink
every month but will be used as a contingency plan in the case that an emergency occurs. Excess
money will just be placed as extra capital to work with and can be withdrawn by any of the four
(4) managing partners when deem it be.

53
Marketing Flow Chart
The strategies that will be used by ParaLink for marketing will be based on a market
research to be able to understand and identify the right market to target. From this, a marketing
plan can be formulated, and specific promotional strategies can be employed based from these
plans. After the implementation, the business will make sure that evaluation of effectiveness will
be done to know if it is better to change and improve the plans than continuous implementation.

Conduct a Formulate
START marketing plan
market research

Implement the Develop related Create an

marketing advertising integrated
communications materials needed marketing

Is it
No Improve
effective marketing
program

Yes

Continue
implementation and END
re-evaluate from

Figure 14. Marketing Flow Chart.

Market Penetration
The initial entrance of ParaLink to its market will take place through online
advertisement, making the presence of the company noticeable. This advertisement is to continue
on until the day physical selling is to be permitted. ParaLink aims to skim through its market for
selling by beginning with selling prices as high as the market is willing to pay provided the
company is to not have a loss. Soon after, online selling will take place increasing the size of its
market that is able to purchase the products. Prices are to be expected to lower after two (2) years
of a products reveal. Changes are also to be made on the product in order to satisfy its market.

54
Management and Infrastructure
ParaLink believes that additional management and infrastructure would not serve the
company good in at least the first two (2) years of operation. ParaLink deems that it should only
need extra management members and infrastructure when gross annual sales exceed PHP
1,000,000. This is because when a company generates a revenue of PHP 1,000,000 it can no
longer only have a labor force of five people and little infrastructure to show for. Expanding the
company comes with its overall growth and this is not to be expected in the first few years of
operations as this is only a start-up business with limited funds to work with.

Risk Analysis
A major potential risk for BookPort is that it can be easily copied and sold at a different
name. The idea could be easily copied, and competitors might just change a little aspect of the
product and ParaLink cannot do anything in terms of legal aspects. Competition being too steep
and BookPort might not have a place in the market could be a possible but unlikely risk as the
product idea is quite unique, unheard of, and innovative.

Another risk than ParaLink runs is customers not being able to see the value of BookPort.
Failing to capture value from customers is definitely possible but target marketing would surely
ease the possibility of this happening. This means that the company would only target those
particular people that may have interest in a product of such and avoid those who seem to not
gain interest from BookPort.

55
 CHAPTER VI: FINANCIAL PLAN

Sales and Income Projections

These sales projections are based on the results and responses of ParaLink’s Marketing
Research Survey Questionnaire, which garnered 120 responses and has shown favorable results
towards BookPort. ParaLink will start to receive orders via Google Forms by the first week of
September and is expected to sell more in the upcoming months as the company’s social media
following increase. Listed below are the breakdown of all of ParaLink’s sales and income
projections for the first two years of operation

First Year of Operation

Units Sep- Oct- Nov- Dec- Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- YEAR 1
Purchased 18 18 18 18 19 19 19 19 19 19 19 19 TOTAL
Jet Black 15 15 15 15 15 15 16 16 17 17 17 17 190
Midnight
Blue 20 20 20 20 20 25 25 30 30 30 30 30 300
Burgundy
Red 15 15 15 15 15 15 15 15 15 15 15 15 180
Leather
Brown 15 15 15 15 15 15 15 15 15 15 15 15 180
Total
Units
Purchased 65 65 65 65 65 70 71 76 77 77 77 77 850
Figure 15: Breakdown of the Monthly Purchases of ParaLink for the First Year of
Operations

56
 Sep- Oct- Nov- Dec- Jan- Feb- Mar Apr- May Jun- Jul- Aug YEAR 1
Units Sold '18 '18 '18 '18 '19 '19 -'19 '19 -'19 '19 '19 -'19 TOTAL
Jet Black 14 15 18 15 17 13 13 15 13 19 17 21 190
Midnight
Blue 18 20 22 20 24 27 21 24 21 34 32 37 300
Burgundy
Red 10 8 12 12 15 23 14 15 15 18 19 19 180
Leather
Brown 12 11 15 13 16 10 13 14 12 20 21 23 180
Total Units
Sold 54 54 67 60 72 73 61 68 61 91 89 100 850
Figure 16: Breakdown of the Units Sold per month by ParaLink for the First Year of
Operations

Cost of Goods Sold Sep-'18 Oct-'18 Nov-'18 Dec-'18 Jan-'19 Feb-'19

Jet Black ₱4,900.00 ₱5,250.00 ₱6,300.00 ₱5,250.00 ₱5,950.00 ₱4,550.00

Midnight Blue ₱6,300.00 ₱7,000.00 ₱7,700.00 ₱7,000.00 ₱8,400.00 ₱9,450.00
Burgundy Red ₱3,500.00 ₱2,800.00 ₱4,200.00 ₱4,200.00 ₱5,250.00 ₱8,050.00
Leather Brown ₱4,200.00 ₱3,850.00 ₱5,250.00 ₱4,550.00 ₱5,600.00 ₱3,500.00
Monthly COGS ₱18,900.00 ₱18,900.00 ₱23,450.00 ₱21,000.00 ₱25,200.00 ₱25,550.00

Mar-'19 Apr-'19 May-'19 Jun-'19 Jul-'19 Aug-'19 YEAR 1 TOTAL

₱4,550.00 ₱5,250.00 ₱4,550.00 ₱6,650.00 ₱5,950.00 ₱7,350.00 ₱66,500.00
₱7,350.00 ₱8,400.00 ₱7,350.00 ₱11,900.00 ₱11,200.00 ₱12,950.00 ₱105,000.00
₱4,900.00 ₱5,250.00 ₱5,250.00 ₱6,300.00 ₱6,650.00 ₱6,650.00 ₱63,000.00
₱4,550.00 ₱4,900.00 ₱4,200.00 ₱7,000.00 ₱7,350.00 ₱8,050.00 ₱63,000.00
₱21,350.00 ₱23,800.00 ₱21,350.00 ₱31,850.00 ₱31,150.00 ₱35,000.00 ₱297,500.00
Figure 17: Breakdown of the Monthly Cost of Goods Sold by ParaLink in the First Year of
Operations

57
Revenue Sep-'18 Oct-'18 Nov-'18 Dec-'18 Jan-'19 Feb-'19
Jet Black ₱7,000.00 ₱7,500.00 ₱9,000.00 ₱7,500.00 ₱8,500.00 ₱6,500.00
Midnight Blue ₱9,000.00 ₱10,000.00 ₱11,000.00 ₱10,000.00 ₱12,000.00 ₱13,500.00
Burgundy Red ₱5,000.00 ₱4,000.00 ₱6,000.00 ₱6,000.00 ₱7,500.00 ₱11,500.00
Leather Brown ₱6,000.00 ₱5,500.00 ₱7,500.00 ₱6,500.00 ₱8,000.00 ₱5,000.00
Total Revenue ₱27,000.00 ₱27,000.00 ₱33,500.00 ₱30,000.00 ₱36,000.00 ₱36,500.00

Mar-'19 Apr-'19 May-'19 Jun-'19 Jul-'19 Aug-'19 YEAR 1 TOTAL

₱6,500.00 ₱7,500.00 ₱6,500.00 ₱9,500.00 ₱8,500.00 ₱10,500.00 ₱95,000.00
₱10,500.00 ₱12,000.00 ₱10,500.00 ₱17,000.00 ₱16,000.00 ₱18,500.00 ₱150,000.00
₱7,000.00 ₱7,500.00 ₱7,500.00 ₱9,000.00 ₱9,500.00 ₱9,500.00 ₱90,000.00
₱6,500.00 ₱7,000.00 ₱6,000.00 ₱10,000.00 ₱10,500.00 ₱11,500.00 ₱90,000.00
₱30,500.00 ₱34,000.00 ₱30,500.00 ₱45,500.00 ₱44,500.00 ₱50,000.00 ₱425,000.00

Gross Profit Sep-'18 Oct-'18 Nov-'18 Dec-'18 Jan-'19 Feb-'19

Jet Black ₱2,100.00 ₱2,250.00 ₱2,700.00 ₱2,250.00 ₱2,550.00 ₱1,950.00
Midnight Blue ₱2,700.00 ₱3,000.00 ₱3,300.00 ₱3,000.00 ₱3,600.00 ₱4,050.00
Burgundy Red ₱1,500.00 ₱1,200.00 ₱1,800.00 ₱1,800.00 ₱2,250.00 ₱3,450.00
Leather Brown ₱1,800.00 ₱1,650.00 ₱2,250.00 ₱1,950.00 ₱2,400.00 ₱1,500.00
Total Revenue ₱8,100.00 ₱8,100.00 ₱10,050.00 ₱9,000.00 ₱10,800.00 ₱10,950.00

Mar-'19 Apr-'19 May-'19 Jun-'19 Jul-'19 Aug-'19 YEAR 1 TOTAL

₱1,950.00 ₱2,250.00 ₱1,950.00 ₱2,850.00 ₱2,550.00 ₱3,150.00 ₱28,500.00
₱3,150.00 ₱3,600.00 ₱3,150.00 ₱5,100.00 ₱4,800.00 ₱5,550.00 ₱45,000.00
₱2,100.00 ₱2,250.00 ₱2,250.00 ₱2,700.00 ₱2,850.00 ₱2,850.00 ₱27,000.00
₱1,950.00 ₱2,100.00 ₱1,800.00 ₱3,000.00 ₱3,150.00 ₱3,450.00 ₱27,000.00
₱9,150.00 ₱10,200.00 ₱9,150.00 ₱13,650.00 ₱13,350.00 ₱15,000.00 ₱127,500.00
Figure 18: Breakdown of the Monthly Total Revenue and Gross Profit of ParaLink for the
First Year of Operations

58
Figure 19: Total Breakdown of the Net Income/Retained Earnings of ParaLink for the
First Year of Operations
59
 ParaLink will be incorporating a monthly purchasing plan to avoid having excess
products as the company will seek to clear out inventory before starting the second year of
operation. As the year progresses, management will continue to reassess how much units to be
purchased according to how much the product sell. By the 4th quarter of the year, units
purchased are increased by 18% to accommodate the increasing demand the company expects
for the product. Purchases for the color Midnight Blue is significantly higher than the others as
based on the marketing research survey conducted this color has been selected as the preferred
color. Purchases for the color Jet Black is seen to increase in the 4th quarter of the fiscal year as
it is seen to be the second-most preferred color based on the responses received from the survey
questionnaire. Burgundy Red and Leather Brown round up the top 4 most preferred color
according the survey conducted by the marketing department. The total purchases for the first
year of operation is 850 units and each and every unit is expected to be sold at year-end which
would explain why there is no Merchandise Inventory account in the Statement of Financial
Position as of year-end August 31, 2019. One unit of BookPort will have a cost price of PHP
350.00 and this will stay consistent for at least the first 2 years of operation. It is indeed a goal
for the company to lessen costs per unit to increase the gross profit margin.

The number of units sold, and the number of units purchased are in correlation which
each other as both will be at a total of 850 which means all units purchased are also to be sold
within the first year of operation. A slow and steady monthly growth in sales is to be expected as
more people would be aware of BookPort and the audience of the products grows. Midnight Blue
is again expected to be the best-selling color at year-end followed by Jet Black. A total of 300
units of Midnight Blue BookPorts will be expected to be sold at year-end. The company will
BookPort at PHP 500.00 a piece for all the colors currently available for purchase. Cost of goods
sold would be at PHP 297,500 to be able to cover the 850 units ParaLink aims and project to sell
for the first year of operation. The total revenue to be projected is at PHP 425,000 and minus the
cost of goods sold of PHP 297,500, a gross profit of PHP 127,500 total for the first year of
operations. Operating expenses of PHP 37,900 will be deducted to the gross profit to acquire a
net income/ retained earnings value of PHP 89,600. The company believes that this is the
estimated sales forecast for the first year and will use this as a guide to be able to have set sales

60
goal going into the future. The company is expected to profitable just after the first month but
only with a net income of PHP 800. Deciding to purchase monthly rather than just purchasing
once for the whole year helps ParaLink to stay profitable and break-even every month as an
extremely large cash outflow of a one-time purchase is harder and longer to receive profit from.
Purchasing monthly gives ParaLink the chance to create short-term objectives that will help
complete and progress on long-term objectives.

Second Year of Operation

Units Sep- Oct- Nov- Dec- Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- YEAR 2
Purchased 19 18 18 18 19 19 19 19 19 19 19 19 TOTAL
Jet Black 25 25 25 25 25 25 25 25 25 25 25 25 300
Midnight
Blue 30 30 35 35 35 35 35 35 35 35 35 35 410
Burgundy
Red 22 22 22 22 22 22 22 22 22 22 22 23 265
Leather
Brown 25 25 25 25 25 25 25 25 25 25 25 25 300
Total
Units
Purchased 102 102 107 107 107 107 107 107 107 107 107 108 1275
Figure 20: Breakdown of the Monthly Purchases of ParaLink for the Second Year of
Operations

61
 Sep- Oct- Nov- Dec- Jan- Feb- Mar Apr- May- Jun- Jul- Aug YEAR 2
Units Sold '19 '19 '19 '19 '20 '20 -'20 '20 '20 '20 '20 -'20 TOTAL
Jet Black 21 23 22 25 26 24 26 24 28 29 26 26 300
Midnight Blue 33 31 31 32 33 31 34 33 36 40 38 38 410
Burgundy Red 19 18 19 21 20 24 21 22 23 24 28 26 265
Leather Brown 22 18 24 20 26 23 27 25 26 27 30 32 300
Total Units
Sold 95 90 96 98 105 102 108 104 113 120 122 122 1275
Figure 21: Breakdown of the Units Sold per month by ParaLink for the Second Year of
Operations

Cost of Goods Sold Sep-'19 Oct-'19 Nov-'19 Dec-'19 Jan-'20 Feb-'20

Jet Black ₱7,350.00 ₱8,050.00 ₱7,700.00 ₱8,750.00 ₱9,100.00 ₱8,400.00
Midnight Blue ₱11,550.00 ₱10,850.00 ₱10,850.00 ₱11,200.00 ₱11,550.00 ₱10,850.00
Burgundy Red ₱6,650.00 ₱6,300.00 ₱6,650.00 ₱7,350.00 ₱7,000.00 ₱8,400.00
Leather Brown ₱7,700.00 ₱6,300.00 ₱8,400.00 ₱7,000.00 ₱9,100.00 ₱8,050.00
Monthly COGS ₱33,250.00 ₱31,500.00 ₱33,600.00 ₱34,300.00 ₱36,750.00 ₱35,700.00

Mar-'20 Apr-'20 May-'20 Jun-'20 Jul-'20 Aug-'20 YEAR 2 TOTAL

₱9,100.00 ₱8,400.00 ₱9,800.00 ₱10,150.00 ₱9,100.00 ₱9,100.00 ₱105,000.00
₱11,900.00 ₱11,550.00 ₱12,600.00 ₱14,000.00 ₱13,300.00 ₱13,300.00 ₱143,500.00
₱7,350.00 ₱7,700.00 ₱8,050.00 ₱8,400.00 ₱9,800.00 ₱9,100.00 ₱92,750.00
₱9,450.00 ₱8,750.00 ₱9,100.00 ₱9,450.00 ₱10,500.00 ₱11,200.00 ₱105,000.00
₱37,800.00 ₱36,400.00 ₱39,550.00 ₱42,000.00 ₱42,700.00 ₱42,700.00 ₱446,250.00
Figure 22: Breakdown of the Monthly Cost of Goods Sold by ParaLink in the Second Year
of Operations

62
Revenue Sep-'19 Oct-'19 Nov-'19 Dec-'19 Jan-'20 Feb-'20
Jet Black ₱10,500.00 ₱11,500.00 ₱11,000.00 ₱12,500.00 ₱13,000.00 ₱12,000.00
Midnight Blue ₱16,500.00 ₱15,500.00 ₱15,500.00 ₱16,000.00 ₱16,500.00 ₱15,500.00
Burgundy Red ₱9,500.00 ₱9,000.00 ₱9,500.00 ₱10,500.00 ₱10,000.00 ₱12,000.00
Leather Brown ₱11,000.00 ₱9,000.00 ₱12,000.00 ₱10,000.00 ₱13,000.00 ₱11,500.00

Mar-'20 Apr-'20 May-'20 Jun-'20 Jul-'20 Aug-'20 YEAR 2 TOTAL

₱13,000.00 ₱12,000.00 ₱14,000.00 ₱14,500.00 ₱13,000.00 ₱13,000.00 ₱150,000.00
₱17,000.00 ₱16,500.00 ₱18,000.00 ₱20,000.00 ₱19,000.00 ₱19,000.00 ₱205,000.00
₱10,500.00 ₱11,000.00 ₱11,500.00 ₱12,000.00 ₱14,000.00 ₱13,000.00 ₱132,500.00
₱13,500.00 ₱12,500.00 ₱13,000.00 ₱13,500.00 ₱15,000.00 ₱16,000.00 ₱150,000.00
₱54,000.00 ₱52,000.00 ₱56,500.00 ₱60,000.00 ₱61,000.00 ₱61,000.00 ₱637,500.00

Gross Profit Sep-'19 Oct-'19 Nov-'19 Dec-'19 Jan-'20 Feb-'20

Jet Black ₱3,150.00 ₱3,450.00 ₱3,300.00 ₱3,750.00 ₱3,900.00 ₱3,600.00
Midnight Blue ₱4,950.00 ₱4,650.00 ₱4,650.00 ₱4,800.00 ₱4,950.00 ₱4,650.00
Burgundy Red ₱2,850.00 ₱2,700.00 ₱2,850.00 ₱3,150.00 ₱3,000.00 ₱3,600.00
Leather Brown ₱3,300.00 ₱2,700.00 ₱3,600.00 ₱3,000.00 ₱3,900.00 ₱3,450.00
Total Gross Profit ₱14,250.00 ₱13,500.00 ₱14,400.00 ₱14,700.00 ₱15,750.00 ₱15,300.00

Mar-'20 Apr-'20 May-'20 Jun-'20 Jul-'20 Aug-'20 YEAR 2 TOTAL

₱3,900.00 ₱3,600.00 ₱4,200.00 ₱4,350.00 ₱3,900.00 ₱3,900.00 ₱45,000.00
₱5,100.00 ₱4,950.00 ₱5,400.00 ₱6,000.00 ₱5,700.00 ₱5,700.00 ₱61,500.00
₱3,150.00 ₱3,300.00 ₱3,450.00 ₱3,600.00 ₱4,200.00 ₱3,900.00 ₱39,750.00
₱4,050.00 ₱3,750.00 ₱3,900.00 ₱4,050.00 ₱4,500.00 ₱4,800.00 ₱45,000.00
₱16,200.00 ₱15,600.00 ₱16,950.00 ₱18,000.00 ₱18,300.00 ₱18,300.00 ₱191,250.00
Figure 23: Breakdown of the Monthly Total Revenue and Gross Profit of ParaLink for the
Second Year of Operations

63
Figure 24: Total Breakdown of the Net Income/Retained Earnings of ParaLink for the
First Year of Operations

64
 Heading into the second year of operations, a 50% or 425 unit increase in the total
number of units to be purchased for the whole year is expected as units purchased will increase
to 1275. This is due to the expected continued slow and steady growth for the second year of
operations as again the exposure of BookPort will increase in compliance to the subsequent
audience and following increase of ParaLink’s social media platforms. The company also again
expects to be able to sell of the units in their inventory at year-end. As the total units sold
increase, a subsequent increase in revenue, gross profit, and net income will also be expected to
cater to the growth of the business. ParaLink believes revenue would increase by PHP 212,500
or a 50% increase from the prior year as it comes to a total of PHP 637,500 and a monthly net
revenue of PHP 53,125. Cost of goods sold also increased by 50% to a total of PHP 446,250 and
deduct that to total revenue to get a gross profit of PHP 191,250. Operating expenses have
dropped from PHP 37,900 the prior year to PHP 36,600 and that resulted into a much larger net
income of PHP 154,650 from PHP 89,600 the prior year, that is a 72.6% increase in income from
the prior year. This is a result of estimating company growth after a year and by purchasing more
units. Purchasing of units increased by a lot comparing it from August 2019 to September 2019.
That is because of the noticeable higher units sold during the month of August 2019, which
became a sign that the amount the company must purchase increase as the demand for BookPort
has increased.
Cash Requirements

ParaLink’s Cash Requirement (September 2018)

Total Funding PHP 50,000.00

Monthly Purchases (PHP 22,750.00)

Administrative Expenses (PHP 2,200.00)

Distribution Costs (PHP 600.00)

Office Equipment (PHP 15,000.00)

Store Equipment (PHP 2,000.00)

Store Furniture and Fixtures (PHP 2,500.00)

Total Remaining Cash PHP 4950.00

Table 4.1 Start-up Cash Requirements of ParaLink

65
 The cash requirement incurred by ParaLink to successfully operate is at least PHP 50,000
monthly. PHP 50,000 will be enough to jumpstart the business and successfully start-up the
company. Details of the how the PHP 50,000 will be used is displayed on the table above. All
remaining cash would again be used to continue operation the following month.

ParaLink’s Cash Requirement (August 2019)

Total Funding PHP 50,000.00

Monthly Purchases (PHP 26,950.00)

Administrative Expenses (PHP 2,200.00)

Distribution Costs (PHP 600.00)

Total Remaining Cash PHP 20,050.00

Table 4.2 Operating Cash Requirements of ParaLink

ParaLink’s operating cash requirement will depend on the month’s inventory and
purchases value. The remaining cash balance every month will be in turn used to either fund the
following month’s operation or as an emergency cash reserve that can be withdrawn by any of
the managing partners in cases of contingency. PHP 50,000 every month would ensure company
growth and would secure that operations would go smoothly.

Sources of Financing
All of the financing costs required to start-up ParaLink will be covered by the initial
investments of the company’s Board of Directors. The company would not be requiring a loan
for the first two years of operation as operating expenses and cash requirements needed by the
company can all be shouldered by Board of Directors. The four managing partners would each
chip-in PHP 12,000 and the fifth director would only be investing PHP 2,000. ParaLink would as
much as possible avoid applying for loans as the needed capital is still relatively low and the
company does not manufacture its own products and would not yet require a manufacturing plant
for the first two years of operation. If company growth is sustainable and steady throughout the

66
following years, then a loan will be applied for to either start setting up an actual shop,
expanding product line, or setting up a manufacturing plant.

67
Attached Financial Projections
· Income Statement
ParaLink
Income Statement
For the year-ended August 2019
Sales Revenue
Jet Black ₱95,000.00
Midnight Blue ₱150,000.00
Burgundy Red ₱90,000.00
Leather Brown ₱90,000.00
Total Revenue ₱425,000.00
Cost of Goods Sold
Jet Black ₱66,500.00
Midnight Blue ₱105,000.00
Burgundy Red ₱63,000.00
Leather Brown ₱63,000.00
Monthly COGS ₱297,500.00
Total: Gross Profit ₱127,500.00

Less: Operating Expenses ₱37,900.00

Administrative Expenses:
Utilities ₱3,000.00
Rent ₱2,400.00
Salaries ₱21,000.00
Distribution Costs:

Store Furniture and Fixtures ₱2,500.00

Store Equipment ₱2,000.00
Store Supplies ₱4,600.00
Advertising/Marketing ₱2,400.00
Total Operating Expenses ₱37,900.00
Net Income/Retained Earnings ₱89,600.00
Figure 25: ParaLink’s Income Statement for the First Year of Operations

68
 ParaLink
Income Statement
For the year ended August 2020
Sales Revenue
Jet Black ₱150,000.00
Midnight Blue ₱205,000.00
Burgundy Red ₱132,500.00
Leather Brown ₱150,000.00
Total Revenue ₱637,500.00
Cost of Goods Sold
Jet Black ₱105,000.00
Midnight Blue ₱143,500.00
Burgundy Red ₱92,750.00
Leather Brown ₱105,000.00
Monthly COGS ₱446,250.00
Total: Gross Profit ₱191,250.00
Less: Operating Expenses
Administrative Expenses:
Utilities ₱6,000.00
Rent ₱2,400.00
Salaries ₱21,000.00
Distribution Costs:
Store Supplies ₱4,800.00
Advertising/Marketing ₱2,400.00
Total Operating Expenses ₱36,600.00

Net Income/Retained Earnings ₱154,650.00

Figure 26: ParaLink’s Income Statement for the Second Year of Operations

69
 ParaLink’s projected net income for the first year of operations is PHP 89,600 which can
be considered a good enough number as the business is only a start-up and not a large-scale
business with unlimited capital to work with. This is a modest expectation for a business that
only plans to sell 850 units and a starting capital of only PHP 50,000. Total operating expenses
incurred and paid for in the first year of operation amounted to PHP 37,900. Sales revenue from
selling BookPorts amounted to PHP 425,000 and the gross profit from selling is PHP 127,500.

For the second year of operations total revenue is expected to grow to PHP 637,500 and a
gross profit of PHP 191,250 and that is a 50% increase in sales. This is primarily due to the
higher amount of purchases done in the second year of operations which also increased by 50%.
ParaLink projects that the company would be able to sell 50% than the prior year due to increase
in demand and awareness about the product. Total operating expenses incurred for second year
of operations is noticeably lower than the prior year down to PHP 36,600 from PHP 37,900. This
is due to expenses incurred from Store Equipment and Fixtures being no longer there in the
second year of operations. Net income or retained earnings increase from PHP 89,600 to PHP
154,650 the following year, which is a 72.6% increase or a PHP 65,050 increase in income. This
is again largely due to the greater of amount of purchases and units expected to be sold. The
company again expects to sell all units purchased which leaves the inventory with zero balance
at year-end. The company will continue to increase units purchased by 50% yearly until it does
not make sense to do so.

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Balance Sheet and Statement of Financial Position

ParaLink
Statement of Financial Position
As of August 31, 2019
ASSETS
Current Assets
Cash ₱139,600.00
Inventory ₱0.00
Store Supplies ₱0.00
Total Current Assets ₱139,600.00
Fixed (Long-Term) Assets
Store Equipment ₱2,000.00
Office Equipment ₱15,000.00
Store Furniture and Fixtures ₱2,500.00
Total Fixed Assets ₱19,500.00
Total Assets ₱159,100.00
LIABILITIES AND OWNER'S EQUITY
Current Liabilities
Accounts Payable ₱0.00
Total Liabilities ₱0.00
Owner's Equity
Initial Cash Investment ₱50,000.00
Retained Earnings, beginning ₱77,200.00
Net Income ₱12,400.00
Retained Earnings, end ₱89,600.00
Other Investment (equipment, etc.) ₱19,500.00
Total Owner's Equity ₱159,100.00
Total Liabilities and Owner's Equity ₱159,100.00
Figure 27: ParaLink’s Statement of Financial Position for the First Year of Operations

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Figure 28: ParaLink’s Monthly Balance Sheet Breakdown for the First Year of
Operations
72
Figure 29: ParaLink’s Monthly Balance Sheet Breakdown for the Second Year of
Operations
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 ParaLink
Statement of Financial Position
As of August 31, 2020
ASSETS
Current Assets
Cash ₱294,250.00
Inventory ₱0.00
Store Supplies ₱0.00
Total Current Assets ₱294,250.00
Fixed (Long-Term) Assets
Store Equipment ₱2,000.00
Office Equipment ₱15,000.00

Store Furniture and Fixtures ₱2,500.00

Total Fixed Assets ₱19,500.00
Total Assets ₱313,750.00
LIABILITIES AND OWNER'S EQUITY
Current Liabilities
Accounts Payable ₱0.00
Total Liabilities ₱0.00
Owner's Equity
Initial Cash Investment ₱50,000.00

Retained Earnings, beginning ₱229,000.00

Net Income ₱15,250.00
Retained Earnings, end ₱244,250.00

Other Investment (equipment, etc.) ₱19,500.00

Total Owner's Equity ₱313,750.00
Total Liabilities and Owner's Equity ₱313,750.00
Figure 30: ParaLink’s Statement of Financial Position for the Second Year of
Operations

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 Financial Ratio Analysis

PARALINK FINANCIAL RATIOS (YEAR 1)

Profitability Ratios

Gross Margin Gross Margin ÷ Net Sales

Percentage = Revenue = 30.00%

Return on Sales (Profit Net Income ÷ Net Sales

Margin) = Revenue = 21.08%

Operating Income ÷ Net Sales

Operating Margin = Revenue = 21.08%

Net Income ÷ Shareholder's

Return on Equity = Equity = 56.32%

Return on Assets = Net Income ÷ Assets = 56.32%

Liquidity Ratios

Current Asset ÷ Current No current assets are coming

Current Ratio = Liabilities = from liabilities.

No cash/marketable
Cash + Marketable Securities securities are coming from
Cash Ratio = ÷ Current Liabilities = liabilities.
Leverage/Solvency Ratios

Total Liabilities ÷ No liabilities have been

Debt/Equity Ratio = Shareholder's Equity = incurred by the company.
Figure 31: ParaLink’s Financial Ratio Analysis for the First Year of Operations

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 PARALINK FINANCIAL RATIOS (YEAR 2)
Profitability Ratios

Gross Margin Gross Margin ÷ Net Sales

Percentage = Revenue = 30.00%

Return on Sales (Profit Net Income ÷ Net Sales

Margin) = Revenue = 24.26%

Operating Income ÷ Net Sales

Operating Margin = Revenue = 24.26%

Net Income ÷ Shareholder's

Return on Equity = Equity = 49.29%

Return on Assets = Net Income ÷ Assets = 49.29%

Liquidity Ratios

Current Asset ÷ Current No current assets are coming

Current Ratio = Liabilities = from liabilities.

No cash/marketable
Cash + Marketable Securities securities are coming from
Cash Ratio = ÷ Current Liabilities = liabilities.
Leverage/Solvency Ratios

Total Liabilities ÷ No liabilities have been

Debt/Equity Ratio = Shareholder's Equity = incurred by the company.
Figure 32: ParaLink’s Financial Ratio Analysis for the Second Year of Operations

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 ParaLink’s financial ratio are for the first year of operations are decent enough in terms
of profitability as the Gross Profit Margin Percentage is at 30.00%. The company’s Return on
Sales (Profit Margin) is 21.08% and this measures the proportion of sales dollar which is
retained as profit. Maintaining 21.08% of the sales as profit is already considered good for
the management. The Operating Margin of ParaLink is also 21.08%, same as the Gross Profit
Margin. Return on Equity is an indicator of how profitable a company is relative to its total
shareholder equity, while Return on Assets is an indicator of how profitable a company is
relative to its total assets. ParaLink’s Return on Equity Ratio and Return on Assets is at both
at 56.32%. Liquidity and Solvency ratios do not apply to ParaLink as in the first two years of
operations there have been no liabilities incurred by the company. No current assets, cash,
and marketable securities are coming from liabilities. Inventory and Accounts Receivable
Turnover Ratios also do not apply to ParaLink as ParaLink did not have any accounts
receivable for sales in the first two years of operation. The company also projects to clear out
inventory at year-end resulting to not having a balance of inventory remaining.

ParaLink’s estimated financial ratios in the second year of operations can be compared
and contrasted with the first year of operations. Gross Profit Margin Percentage is still at
30% as the cost per unit sold is still relatively the same at PHP 350.00. The company’s
Return on Sales (Profit Margin) increased by 3.18% to 24.26%. This is due to the lessening
of the total operating expenses for the second year of operations. Return on Assets and
Return on Equity both decreased by 7.03% to 49.29%. This is due to the increase in total
assets and equity for the second year of operations and the net income did not increase in the
same pace as total assets and equity did. Similar to the first year of operations, liquidity and
solvency liabilities do not apply as there is still no liabilities incurred by the company.

77
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