Feasibility Study of Establishing a Sapinit (Rubus Rosifolius) Processing Plant in Lucban, Quezon

Date

4-2023

Degree

Bachelor of Science in Agribusiness Management

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Hanna D. Miranda

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Abstract

The idea of establishing a sapinit processing plant in Lucban, Quezon is proposed by the Quezon Agricultural Experimental Station since sapinit fruit is highly perishable. This

processing plant will prolong the shelf-life of the sapinit by processing it to more value- added products such as the wine, jam and juice. They are planning to build one-storey sapinit processing plant in Brgy. Palola Lucban, Quezon. The project can provide income for the farmers or co-operators from whom the processing plant will procure the major raw materials. It will create employment in Lucban since the processing plant is an organization that needs workers, employees and staff to function orderly.

The study aims to investigate and evaluate the viability and possibility of establishing a sapinit processing plant in Lucban, Quezon. Specifically, it aims to present the sapinit processing plant and its planned area of operation; to identify potential risks and problems to be encountered in the establishment of sapinit processing plant and give recommendations. Primary data were composed of interview from researchers in QAES and co-operators in Lucban. It also includes survey from owners of business establishments such as bakeries, wine shop, pasalubong centers and groceries. There were 51 business establishment surveyed: twenty-six (26) bakery owners, three (3) wine shop owners, twelve (12) pasalubong center owners and ten (10) grocery owners. Secondary data were consisted of websites available in the Internet, data and information from Lucban Municipal Office, old thesis and special problems.

The survey results showed that 67% of the respondents are unaware of sapinit. Out of the 22 respondents who answered the survey, 16 are willing to buy the products. The expected demand in a year is 2,040 bottles of wine; 3,300 jars of jam and 4,920 bottles of juice given that the volume of order per month of the target market is the same every month. The most common reasons why they like to buy were because of the taste and its health benefits. Based from the results from the perceived value pricing, the cost price of the buyers for wine, jam and juice is P250, P75 and P30, respectively.

The sapinit processing plant will operate 8 hours per day, twice a week from November to April. It will operate forty-eight (48) days in a year. It is open during Monday and Thursday since harvesting is also done during the same day. Monday and Thursday are the days of operation since a three-day interval is required for every harvest. The processing plant will manufacture 150 kg of sapinit fruit per week which equally divided for the production of each sapinit product. The project will start in March 2013 and the actual operation will start in November 2013 since that is the harvesting season of the sapinit.

QAES will supervise first the management of the processing plant but it will be transferred and managed by the association when it is stable. The organization is headed by the general manager or the associate president. There will be six divisions in the association headed by the following: plantation foreman, processing foreman, marketing head, finance head, records officer or association secretary and purchasing or supply officer. There will be no specific job qualifications as long as the person is a member of the association.

The total initial investment for the establishment of the sapinit processing plant includes the pre-operating expenses, fixed assets investment and working capital investment. The total initial investment for the processing plant is P 651,050.00 wherein forty-four percent (44%) is working capital investment, fifty-four percent (54%) for the fixed asset investment and the remaining two percent (2%) is for the pre-operating expenses.

Based from the sensitivity analysis, the proposed project is acceptable in base scenario and scenario 1 since they have positive NPV and IRR greater than the cost of capital. The project is financially viable and worth investing into. However, if the projected sales decreased by 5% the investment will yield negative NPV of (P 185,688.14) and an IRR less than 12% which is -3.51%.

As shown in the marketing aspect, there is a potential market for these sapinit products. The demand for healthy and nutritious products like sapinit is increasing because of the trend towards healthy lifestyle. The project is technically viable since it can be manufactured into many products.

Potential risk and problems to be encountered in the establishment of the sapinit processing plant are unawareness of the market on sapinit, smallness of demand, lack of supply of sapinit fruit and six months of non-operation in the processing plant. Some of the recommendation for these risks and problems are aggressive promotion, distribution the excess supply of sapinit products to other nearby towns, looking for possible cooperators to increase production and using of other raw materials for wine, jam and juice when sapinit is not available.

Language

English

LC Subject

Raspberries--Varieties, Raspberry industry

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993 2013 M17 N66

Notes

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Document Type

Thesis

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