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ALUGBATEA

BUSINESS PLAN PROPOSAL

12 ABM –G

Liceo-de La Salle, University of St. La Salle

Proposed by:

Aristosa, Kristen May

Concepcion, Febe Ann

Golobiogo, Denise Grace

Ramos, Franz

Saludo, Jowil

Year 2019
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INTRODUCTION

Alugbatea is a start-up tea business that is going to be located in B.S Aquino

Drive, Bacolod City, Negros Occidental. This business tend to catch the interest of the

health conscious people such as professionals, adults, passers-by, and residents that

are located in the specific location since it is placed near hospitals and offices.

This business offers a very healthy tea with the use of alugbati or what you call

vine spinach in other words and has honey in it; thus it is placed in a 200 ml plastic

bottle. Alugbati is gaining rapidly popularity worldwide and it simply means that this

would be a good opportunity to build a tea business that has something to do with this

vegetable plant. What makes this business unique is that it is the first product or tea

that will produce here locally. It is determined to become a daily necessity for local

tea addicts, a place to dream of as one try to escape the daily stresses of life and just a

comfortable place to meet. It also provides a better life habit and to move people from

junk taste to a healthy taste.

Alugbatea is being owned and managed by Mr. Jowil Saludo who has

extensive expertise in marketing, sales, operations strategy and previous marketing

consultant of a successful boutique coffeehouse. His love and knowledge of tea will

make the transition to owning and running his own tea business. The other members

will also have significant roles as managers and leaders for this business venture to be

fully successful. This business expects to raise ₱ 2,500 to serve as its capital for

starting this business.

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Vision

To bring health and best organic tea drink to the world.

Mission

To provide customers with the best tasting, all natural, and organic tea for

their everyday lives.

Goals

The business goals for Alugbatea are the following:

 To maximize the profit in one year

 To provide efficient customer service knowing the power of mouth

advertisement.

 To build image among general public

Objectives

The objectives for Alugbatea are the following:

 To increase sales of Alugbatea to 8% by the end of year

 To maintain a positive cash flow of the business

 To implement a local campaign with the company’s targeted market via the

use of flyers, local newspaper advertisements, and word of mouth.

Keys to Success

 Experienced owner who is Mr. Jowil Saludo that have years of experience in this

and related industries.

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 Enough working capital to survive the first year as to build a customer base

 Value customer’s relationship and satisfaction through providing them the best

service and tea drink that this business can offer.

 Competitive pricing to prevent the loss of customers and market share to the

competitors.
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ENVIRONMENTAL ANALYSIS

Pestel Analysis

 Tax Policies
Political

 Inflation
Economic
 Economic Growth

 Consumer Preference
Sociocultural
 Lifestyle Changes

 Advancement of Technology
Technological
 Uses of Social Media

Ecological  Health Consciousness

 Employment Laws
Legal
 Tax Laws

Political

- Tax Policy

There are various taxes that are applicable to businesses operating in the

Philippines. The value-added tax rate in the Philippines is currently 12%. It is

imposed on all types of sales, leases, and services, and is collected by the Bureau of
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Internal Revenue (BIR) either on a monthly or quarterly basis. VAT is collected for

all businesses, whether big and small, local or foreign-owned and that includes

Alugbatea.

Economic

Food and non-alcoholic beverages drove September 2018 inflation even

higher for the ninth straight month at 6.7 percent, the Philippine Statistics Authority

(PSA). Inflation can impact how the business is doing, it can serve as beneficial to

economic recovery. In the recent years, the rapid modernization and expansion of the

Philippine food and drink retail industry have led to the increase of national and

upscale businesses chains throughout the country.

Sociocultural

Price is one the essential factors consumers consider when they purchase

products and when there are price adjustments, consumers also tend to adjust their

buying behavior. Alugbatea offers an affordable tea drinks and targets the interest of

the students, passers-by, and residents near the area. The Philippines is a youthful and

vibrant consumer market with strong growth potential. Generations by generations,

the lifestyle of each people changes. People can drink anything that they want in order

to satisfy their mood, cravings and others.

Technological

As of 2018, there are 67 million social media users in the Philippines. That is

70.28% of the country’s population. This is one of the many ways to make the
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business-- Alugbatea stand out. Positive and audience engagement is one of the goals

of this business and this is also where potential clients or customers come from. Here

in the Philippines, the modern technology is one of the usable things that all Filipino

use and follow. Technology has important effects on business operations. Alugbatea

would have the ability to communicate with customers. In today’s busy business

environment, it is very a helpful tool for the business to interact with customers

quickly and clearly.

Ecological

With the popularization of knowledge, the consciousness of health and environmental

protection concept are increasingly valued by the consumers and green consumption

is widely discussed in recent years. The number of consumers in the Philippines who

are willing to pay more for sustainable products and services continue to rise,

according to a new study by global performance Management Company, Nielsen. The

2015 Nielsen Global Corporate Sustainability Report shows the inclination among

Filipinos to buy socially responsible brands is among the strongest globally.

Legal

The normal hours of work an employee has to render must not exceed eight (8)

hours a day and should be exclusive of the one (1) hour daily lunch break. Philippine

laws, however, do not prohibit work done for less than eight hours. In this business,

all the employees of Alugbatea would have seven working hours a day for the

manager and cashiers, and eight working hours for the rest of the staffs.
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Five Forces of Competition

Buyer Power

Alugbatea provides high quality of taste of tea that came from a plant; vine

spinach in English or “Alugbati” in Tagalog. This business will surely be enticed by

the customers because it is a new invention and thus, who would have thought that

this plant can be turned into a tea with a lot more benefits than other teas in a human

body.

Threats of New Entries

There are a lot of people who want to build the same as this tea business but

what makes Alugbatea outstanding, it is the first health drink to be produced locally in

the Philippines in which no business could have ever done before.

Competitive Rivalry

Rivalry among competitors in the tea industry is relatively intense. While each

major competitor namely qualitea, bon appe tea and other famous businesses. They

are already known for their famous products and this would cause Alugbatea to have

an obstacle bringing this business an image to the people.

Suppliers Power

This business will get their products from Libertad Market and it will serve as

their main supplier of fresh Alugbati’s. Another advantage is that it’s available and

located near Bacolod which can have an easy access to the business.
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Threats of Substitution

Alugbatea is not the first tea business to build here especially in Negros

Region. Other people also may still prefer to buy native coffees, soft drinks and other

hot and cold beverages. Especially to the millennials who are following the trend of

drinking milkteas.
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SWOT Analysis

S W
 Smart business location  Less recognizable brand
 Good quality product with fresh ingredients  Lacks on online presence
 Doesn’t contain sugar  Low customer awareness

O T
 Introduce new flavors  People claiming to have health issues in the
 Trend toward health conscious lifestyle product
 New target market  Another tea brands competitor

Strengths

The location of Alugbatea will serve as its strength since it is near hospitals
and offices that can catch the interest of the health conscious people such as
professionals, elders, passers-by, and residents of an area. It is located in the middle of
the city. In result, people can have easy accessibility of the product and will also lead
to customer loyalty. Another advantage is that the product doesn’t contain sugar and it
is suitable for people who have diabetics and other health problems.

Weaknesses

Alugbatea is just a start-up business and the downfall side is that not all people
are aware of this product since it is just new. Customers are not yet aware of an
alugbati kind of tea exist. It also lacks an online presence since they still don’t have
yet their own website and doesn’t sell online.
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Opportunities

The external opportunities for Alugbatea are many, but they are time
consuming and costly. First they need to consider if they are willing to open up their
segmentation for younger people. Then they need to adjust their products – more
different flavors as well as innovative value-added products. They can boost the
products they already have and add caffeine-free flavors or refreshment teas such as
different ice teas. Business expansion can be also applied in the future by opening
more than 2 branches of Alugbatea nationwide.

Threats

One of the potential threat of Alugbatea are there might be people claiming to
have health issues or side effects in the product which can result to a bad image. Tea
industry is very intense since there are a lot of competitors who offers the same
products. Direct or indirect competition are both threats for Alugbatea. Direct
competition comes in the form of society tea or other such herbal tea concoctions
which are loved by tea drinkers. Indirect competition comes in the form of coffee,
beverages and other hot as well as cold drinks.

Strategy Formulation

Alugbatea will utilized product development strategy specifically brand

extensions since it is used to increase brand equity and repackaging. Market situations
change, so it makes sense to change up the product mix as well. The product
development strategy is a path forward in an evolving marketplace, keeping the
business relevant and interesting to both customers and employees. Since it is a tea
business, it is important to keep pace with the changing times, appealing to customers
who get bored with always seeing the same offerings.