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Blue Heaven Memorial Park and Resort Business Plan
The Blue Heaven Memorial Park and Resort business plan presented on the following pages is based on research for a Blue Heaven Memorial Park and Resort business in Inawayan, Sta. Cruz, Davao del Sur. It was developed by self-made marketing specialist, Bernardo F. Basmayor, Proprietor of Bottomline Interactive Multimedia Speech Laboratory and Educational Technology. Blue Heaven Memorial Park and Resort Scenario Blue Heaven Memorial Park and Resort is located at Inawayan, Sta. Cruz, Davao del Sur. The currently non-operational organic fertilizer facility, containing an area of 23,240 sq. m., is available for sale at Php250.00 per sq. m.. Blue Heaven Memorial Park and Resort is seeking a Php7,793,000.00 loan to completely purchase the land located at Inawayan, Sta. Cruz, Davao del Sur and to develop the site into a memorial park, coupled with a well landscaped resort facility.
The business can have a minimum total sales revenue of Php84,000,000.00 for the total 5,600 lots available for sale at a minimum of Php15,000.00 per lot, aside from the income generated from the sales of mausoleum, maintenance service fees and the resort fees. Prevailing price of memorial lots is Php20,000.00 to 79,000.00 per lot (from actual interviews and from internet sources). The purchase of this 23,240 sq. m. area is a good purchase because this is cheap and the area is very strategically located near the Inawayan cemetery; located in an area where industries are speedily booming; and the property includes: a building for the main office, a chapel, 2 dormitories, a training facility, a kitchen and dining area, a demo house, and fence • •
• • • • •
Big bonuses to the purchase are the main office building, chapel, dormitories, training facility, kitchen and dining area and demo house. The dormitories, training facility, kitchen and dining area and demo house can be renovated to suit to the design of a mausoleum.
By owning the facility, Blue Heaven can increase its equity for an amount twice of the loan amount or even higher, because the current selling price in the area is now at Php500.00 to Php700.00 per square meter. Aboitiz Power is buying the lots for the Coal Fired Power Plant at Php700.00 per square meter, while Abear family and other land owners in Binugao, a barangay adjacent to Inawayan, are offering their land for sale at Php1,000.00 per square meter. This is because of the sprouting investments in Binugao and Inawayan, like the following: Beer Na Beer, Virgin Cola, Pop Cola, CJ Toyota, Ayala High Ponds, Aboitiz Power and many others. • • • • • • •
Blue Heaven Memorial Park and Resort will establish its niche in the memorial service and resort facility. Projections for 2011 show that it is reasonable to expect expansion of its customer base to new markets and territories. Cash Flow projections support the assumption that the company
will have sufficient funds to purchase other lots and equipment and hire additional employees to support implementation of the marketing programs and expansion plans. How is this business plan organized? The Organizational and Marketing Plans for Blue Heaven Memorial Park and Resort reflects the company’s current status and its plans for its future expansion. It is important that the marketing plan provide convincing evidence supporting the feasibility of the loan. The lender needs to know that the company has the ability to increase its market share (and revenues) enough to insure that it can repay the loan and interest and still maintain its profitability.
Financial Documents need to reflect the company’s history and project its future. T0 provide better presentation, it is assumed that this company has been in business for one year (2011) and is seeking a loan. Therefore, the financial documents need to begin with a summary of financial needs and dispersal of loan funds statement. The next section includes projections and historical financial statements for the 2011 business year (first year in business). They will show how well the company met its original projections and what its current financial status is. The third area to be covered in financial documents will address the company’s projections for the future (2011-2015)— projected cash flow, fiveyear income projection, and projected balance sheet. The closing pages of the financial section contain a financial statement analysis of the company’s history and future projections. Utilizing the financial information developed previously, ratios are computed and matched against industry standards. Management: Blue Heaven Memorial Park and Resort is managed by Bernardo F. Basmayor. He has five prior years of experience in the funeral and memorial business, working for a local funeral parlor and as a salesman of memorial plans. Previously, he worked in a variety of service industries selling and marketing products and services. Basmayor has prospective employees to establish a strong team of very dedicated people who love to work with nature. As manager his role is to identify new business, develop and implement marketing activities, and to negotiate and close new contracts. Current Market: Today the memorial park business serves only individual accounts, with small family accounts, and currently no large corporate accounts. The services include: entombment, lawn care and maintenance. The success of the company is a direct result of Blue Heaven’s ability to provide personal service at a competitive rate, offering unique resort facility, landscaping and design, lawn care and maintenance, thus creating a dedicated customer base.
Currently, the minimum average cost for a memorial lot is Php25,000.00. Due to congestions in public cemetery and the new law decongesting the public cemetery, memorial park becomes an important part of the society to give decent burial for the departed. Projected Market: The projected growth rate for the funeral and memorial services industry, based on the previous years is 28%. Blue Heaven Memorial Park and Resort is expected to be expanding its business with new location, new equipment, marketing, and additional employees to meet and exceed that demand. Blue Heaven Memorial Park and Resort is expecting to grow its customer base by 50% based on the demand, its unique offering, and planned marketing activities.
Loan Repayment and Loan Security: The Php7,793,000.00 in loan funds will be required for the acquisition of the 23,240-square meter lot and for its development into a memorial park and resort. Repayment of the 5-year loan, plus interest, can begin promptly in January, when loan is approved and released in November. Early retirement of the loan is anticipated, possibly by the end of tax year 2013.
In addition to the property and facility, itself, the loan can further be secured by the lot to be acquired as owner’s equity which is, currently valued at, Php11,162,000.00, if based on the price value of Php500.00 per square meter or Php16,680,000.00, if based on the buying price of Aboitiz for the Coal Fired Power Plant at Php700.00 per square meter. The property can have a market value of Php23,240,000.00 if based on the selling price of Abear family and other land owners in Binugao who are offering their land for sale at Php1,000.00 per square meter. The lot can even have a high Php84,000,000.00 when it is based on the projected sales of memorial lots plus the sales and maintenance of the mausoleums and the revenues of the resort. Summary Description of the Business Blue Heaven Memorial Park and Resort, as a single proprietorship, handles memorial services, landscaping, lawn maintenance and resort facility, of individuals, family accounts and corporate or cooperative accounts in Inawayan, Sta. Cruz, Davao del Sur. It aims to begin with individual accounts and family accounts. It also aims to target corporate or cooperative accounts. Of the 23,240 square meters, Only 20,000 square meters is allocated for memorial park. It is assumed that 14,000 square meters or 70% of the land area allocated for memorial park is available for sale, with 5,600 lots at 2.5 square meters per lot.
Table 1 shows the distribution or allocation of land to memorial park and resort facility, as well as its profit potential. TOTAL LAND AREA
Memorial Park Resort Facility 30% for road and facilities Net Area for Memorial Park Area Per Memorial Lot Total Memorial Lots For Sale Price Per Memorial Lot Total Projected Gross Sales Loan Amount Projected Gross Sales Profit
23,240 square meters 20,000 square meters 3,240 square meters 6,000 square meters 14,000 square meters 2.5 square meters 5,600 lots Php15,000.00 per lot Php84,000,000. 00 Php11,689,500.00 Php72,310,500.00
For the first year of operation, the company is expected to conservatively sell 10% of the 5,600 lots available for sale, totaling Php8,400,000.00 in revenue, for Individual accounts alone, at the price of Php15,000.00 per lot.
Family Accounts may generate Php5,000,000.00, when 10 mausoleums are sold at Php500,000.00 per account. Table 2 clearly shows the Projected Sales with 20% Sales Increase Per Year.
Lots Annual Increase Amount Total
Year 1 560
Year 2 672
Year 3 806.4
Year 4 967.68
Year 5 1161.216
8,400,000 .00 8,400,000 .00
20% 10,080,000 .00 18,480,000 .00
20% 12,096,000 .00 30,576,000 .00
20% 14,515,200 .00 45,091,200 .00
20% 17,418,240 .00 62,509,440 .00
When business is tied up with cooperatives that are offering mortuary and funeral services or cooperative with funeral parlor, it is assumed that it would generate a sell of 1,000 cooperative or corporate accounts, totaling Ph15,000,000.00, in just two years. The business can have a total sales revenue of Php84,000,000.00 for the total 5,600 lots available for sale at Php15,000.00 per lot, aside from the income generated from the sales of mausoleum and the resort fees.. Mission Blue Heaven Memorial Park and Resort’s mission is to be perceived as the most valued provider of memorial, landscaping and resort services. The company can be very successful due to the high standard of service and care provided to the customer and because of its reputation for quick response times for memorial, landscaping and resort services. Business Model The company also offers a unique service of Memorial Park and Resort with oriental garden design landscaping, the only one in the area. Today that service will be offered in Inawayan and Binugao only. The plan is to open markets in Digos, Panabo and Tagum over the next 3 years. It is important to note that these Memorial Park and Resort with oriental garden design landscaping are not only a unique service; they are also the company’s premium high ticket service and provide a larger profit margin, directly impacting the company’s bottom line. Strategy The company’s growth strategy is to buy out 2 to 10-hectare lots as we expand the business in Digos, Panabo and Tagum and increase our Large Corporate or Cooperative accounts, while maintaining focus on Individual and Family Accounts. Currently, with local corporations and cooperatives offering mortuary benefits, these services to the employees and members of cooperatives, respectively, has become prevalent.
Facility The company currently envisioned to purchase a 23,240 sq. m. area, in Inawayan, St. Cruz, Davao del Sur, which includes a building for the main office, a chapel, dormitories, training facility, kitchen and dining area and a demo house fenced in for parking and security. The dormitories, training facility and demo house may be renovated to suit to the design of a mausoleum. These facilities are a bonus to the purchase. Products and Services Blue Heaven Memorial Park and Resort offers three categories of memorial services to three varieties of customers. The customers consist of
Individuals, Families, and Large Corporations or Cooperatives. Each group has the option of purchasing the same types of services. A memorial service includes funeral cortege, last rites and entombment. Lawn care includes, mowing, weeding, planting, re-sod, pest control, and maintenance. The third service offered is resort viewing. This will attract more customers and advertize the memorial park through word of mouth advertizing which us now termed as Viral Advertizing. Landscaping gives the site soothing and enticing quality. All the plantings are high quality and are purchased from a local nursery that has been in the business for over 15 years. Blue Heaven also aims to have an arrangement to use the nursery as a consultant when there is a need for it. Customer Profiles The following are descriptions of the three types of customer and the services that are typically purchased by each. 1.
Individuals in mid-income to high-income areas, typically purchase memorial lots, lawn care that consists of mowing, weeding, pest control, and maintenance. Additionally, 50% of the Individual customers also purchase lawn maintenance contracts for their lots, and these customers are charged a minimal flat fee and a per call fee, with an up-front deposit to insure they get priority service.
There are two people assigned per lawn care and maintenance job: two part-time college students, over-seen by a supervisor. This job can take an average of two hours to complete. 2.
Family is the second type of customer. They typically consist of family members or immediate relatives and require a mausoleum and landscaping care, weed and pest control and minimal lawn mowing. The average time required to service this type of account is three to four hours with one supervisor and two or three part-time employees. All the family accounts have a contract for maintenance and security. A pre-determined amount for the contract is negotiated in Oct. for the four months November thru February, with a per call fee for the month of May, which can have unpredictable rains. These customers require quick response times and are charged for that level of service, as they need to accommodate their own family members during visiting hours, especially during All Souls’ Day and All Saints’ Day.
3.
Large Corporate Accounts or Cooperatives Accounts are the third type of customer. They require the same services as the Individual and Family Accounts. The accounts that are being targeted will require an average of one follow up per month. This is the area to be expanded over the next three years. To support the marketing campaign every week during the marketing months, one sales representative is hired and dedicated to marketing for every company and cooperative.
Corporate and Cooperatives Account contracts are negotiated individually, and may be paid through salary or membership deduction, which range from Php500.00 to Php1,000.00 per month depending on the length of installment and specific landscaping and maintenance requirements. These customers also require immediate response times especially in November during the All Souls’ Day, All Saints’ Day and anniversary visitation.
Administrative Plan Legal Structure Blue Heaven Memorial Park and Resort is a single proprietorship filed under the same name. The legal and financial advisors recommended a single proprietorship as the most efficient structure based on the plan to purchase the lot in Inawayan, Sta. Cruz, Davao del Sur. This will leave the flexibility of having additional expansion plans on hand.
Business Officers:
Bernardo F. Basmayor Sheba B.Lanzo, Djouhanna Fe B. Pelimer Rose C. Goloso Aries P. Basmayor Constantino R. Rabara
Proprietor Secretary Treasurer Bookkeeper Internal Auditor External Auditor
(on call) Aquarius P. Basmayor Pyro Nardz P. Basmayor Ysrael P. Basmayor Supervisor Atty. Daniel O. Evangelio call)
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Marketing Officer Marketing Officer Maintenance
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Legal Counsel (on
The officers of the company determine the direction of the company through its staff meetings. Additionally, there is an incentive plan for staff members to acquire company profit shares based on set profit goals. It should be noted that the Proprietor, Secretary, Treasurer, Bookkeeper, Marketing Officers and Maintenance Supervisor are the only officers working in the day-to-day business. All other officers interact at the monthly staff meetings as well as on an “as needed” basis. This allows the company to have access to expertise and advice at large cost savings, which has a direct impact on the bottom line and growth of the company. Management & Personnel Management Bernardo F. Basmayor is the Proprietor and sole shareholder of Blue Heaven Memorial Park and Resort. He has five prior years of experience in the funeral and memorial business, working for a local competitor. Previously he worked in a variety of service industries selling and marketing memorial plans and other products and services.
Blue Heaven Memorial Park and Resort will be realizing a big growth rate between January to November. The growth rate is attributed to high standards set for customer service. Many customers shifted from the prior cemetery services because of their convenience to memorial park services, the discomfort in the already congested cemetery and the impending implementation of the law decongesting public cemetery. Bernardo F. Basmayor has set up an incentive plan for his employees that rewards them for outstanding customer service based on year-end survey results, or when contracts are renewed for landscaping and maintenance or new business is closed. Under Bernardo F. Basmayor’s management, a strong team of very dedicated people who love to work with nature will be formed. As proprietor
and manager, his role is to identify new business, develop and implement marketing activities, and to negotiate and close new contracts. The Marketing Officers manage the accounts and the Maintenance Supervisor manages maintenance and part-time workers. They also determine staffing and equipment needed to maintain the account. There are also two design specialists, one of which is specifically trained in oriental landscape design to make the Blue Heaven Memorial Park and Resort more attractive and enticing to customers. Personnel There are five full-time office employees –Proprietor/Manager, Secretary, Bookkeeper and two Utility Personnel. Marketing Officers work in the field interacting with clients and opening new accounts. Maintenance Supervisor and four maintenance crews are working in the park and resort. The two design specialists work on an “as needed” basis. The remainders are parttime workers, numbering from four to five or more, depending on the time of the year and work load.
Personnel shall be remunerated as follows: 1. Owner: Guaranteed Salary Php20,000.00 per month with yearly
increases justified by profitability. 2. 2 Design Specialists: Salaries @ Php1,000.00 per call. 3. Two Marketing Supervisors: Salaries @ Php9,000.00 + 5% commission and 3% bonus for excellent year-end customer surveys. 4. Office Manager: Salary @ Php20,000 per month 5. 3Administrative Assistants (Secretary, Treasurer and Bookkeeper): Salaries @ Php7,000.00 per month. 6. 1 Utility Personnel (Janitor): Salary @ Php7,000.00 per month. 7. 3 Security Personnel: Agency Contract @ Php7,000.00 per month 8. 1 Maintenance Supervisor: Salary @ Php9,000.00 per month. 9. Part-time workers: 5-7 @ Php100.00 per hour; (more added as volume increases). Training All employees receive training from the Proprietor and the Supervisors in the following areas: Given by the Proprietor a. Company policies and procedures regarding the customers and company standards b. Memorial service and landscaping orientation at the time they are hired c. Liability and safety procedures d. Equipment care and theft policies Given by the Supervisors a. Overview of each account assignment b. Accounts assignment and training - operation of mowers, tools, and supplies c. Chemicals precautions Personnel Duties 1. Proprietor a. Sets company policies and trains all new employees
b. c. d. e. f.
Solicits, interviews and hires new employees Assigns accounts to Supervisors Negotiates new and large contracts Approves the purchases of equipment and supplies Handles customer service issues that cannot be satisfied by the Supervisor g. Reviews and signs all checks h. Follows up on Supervisors sales leads 2. Marketing and Maintenance Supervisors - report to Proprietor a. Manages on average 25 Individual Accounts Sales Representatives and 10 Family Accounts Sales Representatives b. Will be managing 1-2 Large Corporate or Cooperatives accounts c. Responsible for training part-time help on account profiles and equipment d. Forecasts services and supplies needed for each account e. Forecasts and manages work schedules f. Conducts second round of interviews of part-timers and approves g. Handles account problems related to service and quality issues h. Solicits new business leads to President. i. Responsible for inventory and equipment assigned to their team 3. Office Manager - reports to the Proprietor a. Manages account scheduling b. Supports Supervisors - back-up supplies miscellaneous c. Takes account calls and passes to supervisors d. Performs yearly customer survey e. Answers phone f. Dispatches and is in close contact with supervisors g. Assigns and maintains equipment for supervisors
4. Administrative Assistants - reports to the Proprietor a. Responsible for Bookkeeping functions of: Daily sales reconciliation Accounts receivable and accounts payable Payroll General Ledger b. Computer Typing - 60 WPM, with software knowledge - WP/Excel/DBase c. With knowledge to 10- key adding machine d. Access to safe e. Tracks orders placed for equipment and supplies • • • •
5. Part-time Employees - report to the Supervisor a. Assigned to work specific accounts b. Mows, weeds, does manual labor c. Identifies any problems d. Follows instructions from supervisor e. Manages inventory of supplies Employee Profile All employees must be: a. Hard working and neat in appearance b. Like working outdoors c. Good communicators d. Team workers e. Educated for full-time work with a minimum HS degree, or in College f. Able to follow directives and be a quick learner g. Dedicated to doing an outstanding job h. Responsible, regarding safety
Accounting and Legal Accounting All bookkeeping is kept on computer, on a regular basis, by the Administrative Assistant on the software “QuickBooks Pro” from Intuit. At the end of the year the files are printed and passed to the accountant Constantino R. Rabara, CPA, who has been a personal friend for many years and has 35 years experience as a CPA. His fees are reasonable and there is a high level of trust in his input to the business.
The customer base and prospect database is kept on the software “ACT” from Contact Software International that allows Blue Heaven to keep precise timelines of scheduling and manage accounts accurately. “Office Professional” from Microsoft allows Blue Heaven to perform Word Processing, develop customized Spreadsheets, and develop proposals and presentations to larger accounts. All the above programs are “off-the-shelf” and are easy to get support for at very reasonable prices. Legal All contracts and other legal matters are handled by Atty. Daniel O. Evangelio, a Cooperative Chair and a personal friend. Atty. Daniel O. Evangelio is the Past President of Rotary Club of Toril South, which the proprietor is the Past Vice-President, and had been working with the Floirendo Group of Companies. Security Problems situations to be considered and protective measures to be taken: 1. Internal theft - Employee Dishonesty a. Shoplifting - of supplies - (4) closed circuit cameras in garage recording 24 hours b. Cash Theft - petty cash limit of Php2,000. Daily receipt drop-off to bank of all receivable c. Falsifying signatures - all checks signed by Proprietor at the end of the day d. Employee orientation - to reduce theft and stress security procedures e. Monthly Inventory - responsibility of the Supervisors 2. External Theft a. Walk-in theft - Cameras at each doorway entrance and exits (2) b. Cameras in garage and on parking area, and fenced in plant lot c. Break-in theft/robbery - Alarms set nightly and connected directly to local Police station Marketing Plan Author Note: The Marketing Plan for Blue Heaven Memorial Park and Resort focuses on three of the basic elements—Market Analysis(Target Markets and Competition), Sales Strategy, and Advertising. This marketing plan has a special strength in the target marketing area in that the company planned its strategy for each of its market segments by evaluating the target in terms of: who they are, what the company will do to approach the target, when the campaign will take place, and where the campaign will be positioned. • • • •
Also, the Target Market Worksheet for Target #1 at the end of this section is a great tool for analyzing and planning the target marketing.
It is suggested that the marketing plan for the company should address the components in a way that more closely follows the marketing plan. However, this marketing plan may provide us with an organized means for developing the strategy for individual market segments.
Target Markets and Strategies Target #1 Large Corporate Facilities and Cooperatives Who: Corporations that are providing mortuary benefits to their employees or Cooperatives that are providing mortuary benefits to their members or Cooperatives that offer funeral services. There are approximately 15 accounts that are potential customers within a 20 kilometer radius. Our goal is to secure 5 in 2012. What: Tele-market for background information, and send a direct mail with telemarketing follow-up. Describe Blue Heaven Memorial Park and Resort services with landscaping, lawn maintenance, pest control and all other memorial services, such as corpse removal and re-interment of cadaver from the congested public cemetery to the Blue Heaven Memorial Park and Resort. Provide a guarantee for the services and show competitive comparison pricing from local companies. When: Begin October to inform prospective customers about Blue Heaven Memorial Park and Resort and to invite them to visit the site and persuade them to transfer their beloved departed members of the family from the congested public cemetery to Blue Heaven Memorial Park and Resort before All Saints’ Day so that they can feel the comfort during All Saints’ Day’s visit. Call each account to determine the timing and arrange for an on-site inspection. Where: Position joint services with local garden stores for promotions and advertising.
Target #2 Families Who: Families that want to transfer their beloved departed members of the family from the congested public cemetery to Blue Heaven Memorial Park and Resort or families who are unhappy with the congested public cemetery where their departed family members were buried at different sites in the public cemetery. In the 20 kilometer radius there are approximately 125 accounts that are potential customers. Our goal is to add 5 new contracts in this category in 2012. What: Tele-market for background information and send a direct mail with telemarketing follow-up. Describe all the memorial services, referencing existing satisfied customers. Provide a guarantee for services rendered, show the cost savings using Blue Heaven Memorial Park and Resort, and develop a plan for continued lawn and landscape maintenance.
Offer the company’s quality guarantee, and comparison chart of competitive pricing. When: Beginning October to inform prospective customers about Blue Heaven Memorial Park and Resort and to invite them to visit the site and persuade them to transfer their beloved departed members of the family from the public cemetery to Blue Heaven Memorial Park and Resort before
All Saints’ Day so that they can feel the comfort during All Saints’ Day’s visit. Call each account to determine the timing and arrange for an on-site inspection, to determine the amount of work needed and special needs to develop an estimate. Where: Position joint services with local garden stores for promotions and advertising. Advertise in the local papers, Yellow Pages, radio, TV, billboard and Business to Business Directory.
Target #3 Individuals Who: Target all residential homes in the 20 mile radius that are in middle to high income areas and subdivisions. Contact all existing customers with satisfaction survey, and solicit at the same time for:
a. Additional business –for family members and relatives b. New customers - referrals What: Develop and send company brochure that targets the Individual Accounts supplying them with information on all services offered by Blue Heaven Memorial Park and Resort with price comparisons. When: Develop brochure in September and mail in October prior to All Saints’ Day. Follow-up with existing customers and potential customers, in September to persuade them to transfer their beloved departed members of the family from the congested public cemetery to Blue Heaven Memorial Park and Resort before All Saints’ Day so that they can feel the comfort during All Saints’ Day’s visit. Where: Position joint services with local garden stores for promotions and advertising Competition Blue Heaven Memorial Park and Resort currently has two competitors in the local area: The Toril Memorial Park in Lubogan, Toril, Davao City and the Memorial Park in Bangkas Heights, Toril, Davao City. While they have been in the Toril area for several years, they are family-owned businesses that have a limited number of clientele and the same number of accounts year after year. They also have no type of Memorial Park specialty. Only the Toril Memorial Park offers coffin. Bangkas Memorial Park purely offers to sell memorial lots. Methods of Distribution Blue Heaven Memorial Park and Resort sells directly to the customer, is primarily a service business, offering a memorial service that includes funeral cortege, last rites and entombment. Lawn care includes, mowing, weeding, planting, re-sod, pest control, and maintenance, with the exception of selling the landscaping plants and shrubs, which come from a local nursery wholesaler.
Added to the service package is the excitement that the resort facility could give to the customers. Advertising Strategy Paid Advertising We currently participate in several forms of advertising:
1. Newspaper ads: All ad copy is identical, and includes information required by the newspaper: a. Ads Information : 1. Ad size: The ad is two columns x 3 inches. 2. Timing: Monthly 3. Section: People and Events section b. Ads Location, Contact and Fees: The Mindanao Daily Mirror R. Magsaysay Avenue, Circulation:50,000 Davao City Fee:Php350.00
Mindanao Times Bolton Street, Davao City Anda Street, Davao City
Circulation:20,000 Fee:Php350.00
Sun Star Davao R. Castillo Street Davao City
Circulation;20,000 Fee:Php350.00
2. Yellow pages and directories a. PLDT Yellow Pages Ad Information: Coverage: Yearly Fee: Ad Size: Renewal date:
Philippines Php 2,000.00 1/4page February1st
b. Directories Philippines Ad Information: Coverage: Yearly Fee: Ad Size: Renewal date:
Philippines Php 2,000.00 1/4page February 1st
3. Local Cable Channels Ad Information: Length of ad “spot”: Development cost: Length of campaign: Runs per month: Cost for 3months: Total campaign cost:
60 seconds Php25,000.00(one time fee) 3 c months Three times per day, everyday Php75,000.00. Php80,150.00
Direct Mail Note: There was no direct mail done in the first year of business. With the development of the Marketing Plan, two direct mail pieces will need to be developed to target three potential customer bases for 2012. (See detailed plan of this activity) Direct mail #1 Designed for: Target market #1- Large Corporations and Cooperatives Target market #2 - Family Accounts.
Creative Strategy: Design needs to be glossy, appropriate for corporate, professional environment. Highlight:
Customer service - testimonials Quick response time All services Guarantee Free evaluation
Direct mail #2 Designed for: Target market #3 –Individual Accounts
Creative Strategy: Design should be a tri-fold brochure “self-mailer” (no envelope required) Direct highlights for the homeowner Highlight:
Customer service - testimonials Quick response time All services Guarantee Free evaluation
Community Involvement The Proprietor is an Auxiliary Member of the Inawayan Tourism Committee, Board Member of Doňa Carmen Denia National High School PTA, involved with teaching kids about plants and nature, as well as involved with the “Beautification of DCDNHS” program. Worksheet for Marketing Promotion Target Market #1 : Large Corporate or Cooperative Accounts Date : 01/12 Program Name : Corporate Promo Media : Direct Mail & Telemarketing Program Objectives: Generate a minimum of Php5,000,000.00 in additional revenue in 2012 Increase corporate account and cooperative account base by 5 new accounts Establish Blue Heaven Memorial Park and Resort as a master memorial service provider to large corporations and cooperatives • •
•
Audience: Direct Mail Who - the 15 identified accounts consisting of cooperatives and large corporations. What - Send direct mail (company brochure) to Corporate and Cooperatives managers, listing the services and benefits of Blue Heaven Memorial Park and Resort. Position money back guarantee as an added promotional value. Where- in the Astorga, Darong, Inawayan, Binugao, Tibuloy, Catigan, Barakatan, Marapangi, Sirawan, Lizada, Toril, Dumoy, Bago and Ulas area (20 kilometer radius). When - Drop mail in mid- January. Telemarketing (Prior to mailing): Who - Call all accounts to identify Memorial Park and Resort contact in the large
corporation or cooperatives. What- Find out the mortuary and memorial benefits for each prospect. When - Make phone calls first two weeks of January. Where – NA Telemarketing (Post Direct Mail): Who - Call all contacts and confirm receipt of direct mails What- ask if they received the direct mail and offer a free memorial and resort service consultation. When - Calling begins 5-8 working days after the direct mail is received. Where – NA List source: The list will be taken from the Barangay Offices of Astorga, Darong, Inawayan, Binugao, Tibuloy, Catigan, Barakatan, Marapangi, Sirawan, Lizada, Toril, Dumoy, Bago and Ulas area. Creative Strategy - for Direct Mail: Position Blue Heaven Memorial Park and Resort as a leader in quality service Position Guarantee Leverage existing customer base with success stories Position against the competition Position “free” consulting offer The telemarketing call back in a week •
• • • • •
Creative Strategy - for Telemarketing: Develop script with the same messages as the direct mail will have If possible position - Company and Promotional offer • •
Components of mailing: Tri-fold brochure - components Self-mailer, with reply card Address hand written on the backside • •
Timing: Pre- Mailing Telemarketing %Calle Location d 50% Darong, Inawayan, Binugao, Marapangi, Sirawan, Lizada, 50% Toril, Dumoy, Bago and Ulas
50% Direct Mail %Mail ed 50%
50% 50%
Astorga, Tibuloy, Catigan, Barakatan
Location
Darong, Inawayan, Binugao, Marapangi, Sirawan, Lizada, Toril, Dumoy, Bago and Ulas Astorga, Tibuloy, Catigan, Barakatan
Post- Mailing Telemarketing %Calle Location d 50% Darong, Inawayan, Binugao,
Call Dates
January 2 to 9 January 2 to 9 January 9 to 18
Mail Dates
January 2 to 12 January 2 to 12 January 9 to 18
Call Dates January 22
50% 50%
Marapangi, Sirawan, Lizada, Toril, Dumoy, Bago and Ulas Astorga, Tibuloy, Catigan, Barakatan
January 22 January 29
Call to action: Reply card to be sent to office or sent through text at 09205394711 Lead criteria: “Hot” leads are classified as anyone getting a proposal, evaluation, or call back from the mailing or telemarketing. They have the potential of closing in 2012. “Warm” leads are any accounts that are interested and cannot do anything until 2013 due to their current company’s policy. “Cold” leads are those accounts that are not interested at all, and have no revenue potential in the future. •
•
•
Training: Employees in the field - will be given an overview of the entire promotion to prepare them for customers asking questions, while on the job. Office staff - will receive training and instructions on how to answer the phone and track the responses from the dedicated telephone number and mailer. They will also be assisting on the pre and post telemarketing activities. Expenses: Will not exceed Php80,000.00 for the entire promotion. Measurement: Revenue Goal Php5,000,000.00 Expenses Php80,000.00 Total No. (List) 70 Number of Responses TBD Number of leads TBD Cost per Response TBD Cost per Lead TBD Revenue/Expense Ratio TBD
*TBD = To Be Determined at the end of the program.
Assumptions: Average value per contract = Php15,000,000.00 Response rate = 2.0 % on the Direct mail and 15-20% on the telemarketing or 1.5 responses on the direct mail, and 10-14 on the telemarketing. “Hot” lead rate = 0.5% on the direct mail and 5%- 7% on the telemarketing or 3.5 leads on the direct mail and 3.5-5 leads on the telemarketing • •
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Lead tracking Process: All Direct mail responses will be tracked All Phone calls will be logged when responding on the dedicated telephone number. All regular calls will be screened “Are you calling regarding our direct mail promotion?” • •
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Program review: 30 days after last tele-marketing follow-up call. Summary of Financial Needs I. Blue Heaven Memorial Park and Resort is seeking a loan to increase its equity capital through real estate investment: A. By purchasing the 23,240 sq. m. area, in Inawayan, St. Cruz, Davao del Sur, which includes a building for the main office, a chapel, dormitories, training facility, kitchen and dining area and a demo house fenced in for parking and security. B. By renovating the dormitories, training facility and demo house to suit to the design of a mausoleum. These facilities are a bonus to the purchase. C. By subdividing the 70% of the property into 5,600 memorial lots D. By selling the memorial lots at an affordably low price of Php15,000.00 per lot and Php300,000.00 to Php500,000.00 per mausoleum. E. By exotically landscaping the periphery of the lot and develop a resort facility
II. Blue Heaven Memorial Park and Resort needsPhp7,793,000.00 in loan funds to completely purchase the 23,240 sq. m. area, in Inawayan, St. Cruz, Davao del Sur. Repayment of the 5-year loan, plus interest, can begin promptly in April 2012. Early retirement of the loan is anticipated, possibly by the end of tax year 2013. Loan Fund Dispersal Statement Dispersal of Loan Funds Blue Heaven Memorial Park and Resort will utilize the anticipated loan in the amount of Php7,793,000.00 to purchase the facility (land and buildings) in Inawayan, Sta. Cruz, Davao del Sur and to support the cost of development and marketing. The full purchase price is Php5,810,000.00 and the other Php1,983,000.00 will be used to develop the site as an attractive memorial park and resort. The present owner of the premises is TACDRUP. The parcel of land and accompanying buildings, located at Inawayan, St. Cruz, Davao del Sur, are currently registered under the name of Rey Magno Teves, being the previous director of TACDRUP.
Table 3 shows the simple computation of the total loan amount which may differ from the lender’s computation. Loan Amount Php7,793,000. 00
Interest Per Year Php779,300.00
Total Interest For 5 Years Php3,896,500.00
Total Loan Amount Php11,689,500. 00
2. Back-Up Statement a. The land is currently has a market value of Php6,000,000.00 to Php7,000,000.00 per hectare. Attached buildings are appraised at Php1,557,492.72. The owner, TACDRUP, through its Managing Director, Migdonio C. Clamor, Jr. issued an Authority To Sell to Bernardo F. Basmayor.
b. Bernardo F. Basmayor, having the Authority To Sell from TACDRUP, through its Managing Director, Migdonio C. Clamor, Jr. for the above-mentioned parcel of land, initially offered the property to Korean nationals who expressed their interest in organic fertilizer production and to a businessman who wished to use the area as hospital waste management facility.
c. Blue Heaven Memorial Park and Resort came to the mind of Bernardo F. Basmayor after intensive research as he received some queries about the availability of lots in the area to be used as memorial park but these investors shy away because the price of land in the area is so high that sky rocketed to Php1,000.00 per square meter because of the massive industrial development in Binugao, Davao City and Inawayan, Davao del Sur. d. Bernardo F. Basmayor might be so lucky that he has the
Authority To Sell the property at only Php250.00 per square meter. Purchase of the land and buildings will enable Blue Heaven Memorial Park and Resort, with no additional expense, to repay the loan + interest and to use the value of the land, as equity, which value is estimated to be at Php16,268,000.00 using the price of land purchased by Aboitiz for their Coal fired Power Plant at Php700.00 per square meter. The land can have a market value of Php23,240,000.00 when the Abear family’s price of Php1,000.00 per hectare is used in the assessment. e. The buildings sit on a 23,240 square meter parcel of land,
centrally located in Inawayan, Sta. Cruz, Davao del Sur, near the Inawayan Cemetery. f. The lot is fenced and gated at the front side. There is a 30 square
meter building, more or less, that serves as the main office and a large attached training center, with 2 dormitories, a kitchen and dining area, a chapel and demo house. The Php7,793,000.00 in loan funds when approved by October can be used just-in-time in order to present it for public viewing during All Saints’ Day and All Souls’ Day. g. When the loan is approved and released in October, loan
repayment can begin promptly on April 1 st, 2012 for a 5-year period. The company has a strong cash flow and a rapidlygrowing market. Early payoff is anticipated in 2013. Basic Assumptions: Land Acquisition Php250.00 per square meter X 23,240 square meters = Php5,810,000.00 Development Cost 2 model mausoleums @ Php250,000.00 Php500,000.00 2 Interment Equipment 100,000.00 Landscaping 200,000.00 Resort Structures 250,000.00 Promotion and Marketing 250,000.00 Salaries and Wages 252,000.00 Office Building Renovation 250,000.00 3 computers @ Php21,000.00 63,000.00 Communications @ Php1,000.00 12,000.00 Supplies 10,000.00 Light and Water 12,000.00 Miscellaneous 50,000.00 Maintenance 84,000.00 Php1,983,000.00
TOTAL Php7,793,000.00
Schedule of Loan Amortization Loan Amount 7,793,000.00 10% Interest (Assumed) Php779,300.00 X 5 years 3,896,500.00 Total Amount Payable Php11,689,500.00
Php
Php11,689,500.00 ÷ 5 years
Annual Amortization Php 2,337,900.00
5-YEAR PROJECTED STATEMENT OF CONDITION 2011
2012
2013
2014
2015
ASSETS: CURRENT ASSETS:
P Cash Account Receivables Inventories P
P 10,000.00
11,000.00
396,103.00 2,000,000. 00 2,406,103. 00
435,713.30 2,200,000. 00 2,646,713. 30
P
P
P
12,100.00
P
13,310.00
P
14,641.00
479,284.63 2,420,000. 00 2,911,384. P 63
527,213.09 2,662,000. 00 3,202,523. P 09
579,934.40 2,928,200. 00 3,522,775. 40
NON-CURRENT ASSETS (Net):
Land Buildings Office Equipment Furniture and Fixtures P TOTAL ASSETS: LIABILITIES AND OWNER’S EQUITY:
9,388,400. 00 1,557,492. 72
10,327,240 .00 1,713,241. 99
11,359,964 .00 1,884,566. 19
12,495,960 .40 2,073,022. 81
13,745,556 .44 2,280,325. 09
63,000.00
69,300.00
76,230.00
83,853.00
92,238.30
110,000.00 11,118,892 .72 13,524,995 P .72
121,000.00 12,230,781 .99 14,877,495 .29 P
133,100.00 13,453,860 .19 16,365,244 .82
P
146,410.00 14,799,246 .21 18,001,769 P .30
161,051.00 16,279,170 .83 19,801,946 .23
CURRENT LIABILITIES:
P
11,689,500 P .00
12,858,450 .00 P
14,144,295 .00
P
1,184.19 11,690,684 .19 P
1,302.61 12,859,752 .61 P
1,432.87 14,145,727 .87
P
P
Accounts Payable Income Tax Payable
OWNER’S EQUITY: BF BASMAYOR Capital Beginning
11,000.00 2,791,923. 83
P
713,801.04 1,834,311. 53
785,181.14 2,017,742. 68
P
13,524,995 .72 P
Drawings
P
P
15,558,724 .50 1,576.16 15,560,300 .66
P
10,000.00 2,538,112. 57
Net Income
P
P
P
P
17,114,596 .95 1,733.77 17,116,330 .72
P
12,100.00 3,071,116. 21
13,310.00 3,378,227. 83
P
863,699.26 2,219,516. 95
P
950,069.18 2,441,468. 65
14,877,495 .29 P
16,365,244 .82
P
18,001,769 .30
P
14,641.00 3,716,050. 61 1,045,076. 10 2,685,615. 51
P
19,801,946 .23
TOTAL LIBILITIES AND OWNER’S EQUITY
5-YEAR PROJECTED STATEMENT OF OPERATION
2011
Sales
P
8,400,00 0.00
2012
P
9,240,00 0.00
P
2013
2014
2015
10,164,00 0.00
11,180,40 0.00
12,298,44 0.00
P
P
Less: Cost of Sales: Materials:
Inventory Beginning Purchas es
P
Inventory End P Direct Labor
Total Cost of Sales
P
10,000.00 1,000,000. 00 1,010,000. 00 1,010,000. 00 252,000.0 0 1,262,000. 00
P
P
P
1,010,000 .00 1,200,000 .00 2,210,000 .00 2,210,000 .00 277,200.0 0 2,487,200 .00
P
P
2,210,000. 00 1,440,000. 00 3,650,000. 00 3,650,000. 00
P
P
304,920.00
P
3,954,920. 00
3,650,000. 00 1,728,000. 00 5,378,000. 00 5,378,000. 00
P
P
335,412.00
P
5,713,412. 00
5,378,000. 00 2,073,600. 00 7,451,600. 00 7,451,600. 00 368,953.20
P
7,820,553. 20
Marketing Overhead
Consultancy Fee Meals and Snacks Transportation Expense Light and Water Depreciation Expense Communication Expense
Gross Profit
P
180,000.0 0 15,825.00
P
198,000.0 0 17,407.50
P
217,800.00 19,148.25
P
239,580.00 21,063.08
P
263,538.00 23,169.38
10,304.00 16,205.35
11,334.40 17,825.89
12,467.84 19,608.47
13,714.62 21,569.32
15,086.09 23,726.25
15,000.00
16,500.00
18,150.00
19,965.00
21,961.50
50,650.00 287,784.3 5 1,549,784. 35 6,850,215. 65 P
55,715.00 316,782.7 9 2,803,982 .79 7,535,237 .22
61,286.50
67,415.15
74,156.67
348,461.06 3,084,381. 06 8,288,760. 94
383,307.17 3,392,819. 17 9,117,637. 03
421,637.89 3,732,101. 09 10,029,400 .73
P
P
P
P
Operating Expenses:
Salaries and Wages
P
Commissions Travel and Meals Representation Expense Ads and Donation Telecommunication Expense Taxes and Licenses Light and Water Office Supplies Loan Amortization Miscellaneous Expense Total
P
252,000.0 0 2,520,000. 00 244,250.0 0
P
277,200.0 0 2,772,000 .00 268,675.0 0
P
304,920.00 3,049,200. 00
P
335,412.00 3,354,120. 00
P
368,953.20 3,689,532. 00
295,542.50
325,096.75
357,606.43
75,620.00 50,000.00
83,182.00 55,000.00
91,500.20 60,500.00
100,650.22 66,550.00
110,715.24 73,205.00
14,176.00 15,625.00 14,104.38 5,830.35 2,337,900. 00
15,593.60 17,187.50 15,514.82 6,413.39 2,337,900 .00
17,152.96 18,906.25 17,066.30 7,054.72 2,337,900. 00
18,868.26 20,796.88 18,772.93 7,760.20 2,337,900. 00
20,755.08 22,876.56 20,650.22 8,536.22 2,337,900. 00
15,025.75 5,544,531. 48
16,528.33 5,865,194 .63
18,181.16 6,451,714. 09
19,999.27 7,096,885. 50 P
21,999.20 7,806,574. 05
1,305,684. 17 31,571.60 1,274,112. 57
1,670,042 .59 34,728.76 1,401,523 .83
1,837,046. 85 38,201.64 1,541,676. 21
2,020,751. 53 42,021.80 1,695,843. 83
2,222,826. 68 46,223.98 1,865,428. 21
1,541,676.
1,695,843.
1,865,428.
Net Income Before Tax Provision For Income Tax
P
Net
P 1,274,112.
P
P
1,401,523
P
P
P
P
57
Income
.83
21
83
Notes: Blue Heaven Memorial Park and Resort has taken advantage of the very low selling price of the lot and a rapidly-increasing memorial service marketplace, and has also neatly incorporated funeral cortege, landscaping and maintenance services and resort facility to increase revenues significantly during November and December, March to May. The company is expected to earn an unusually high net profit for a start-up memorial park and resort service business.
Projections indicate high sales growth with the acquisition of new personnel, vehicles, and equipment to service the increased customer base. The company is experiencing rapid, but controlled growth. Financial projections indicate that the company will be more than able to fulfill its obligations to repay the Php7,793,000.00 loan plus interest and still maintain good cash flow and increased profitability. Financial Assumptions Blue Heaven Memorial Park and Resort Business Plan Seeking Bank Loan Purpose facility.
: To purchase land to be used as memorial park and resort
Projected Terms : Php7,793,000.00 for 5 Years @ 10%; need funding by October 1, 2011, repayments can begin on April 1, 2012, if scheduled quarterly with three months grace period or as may be scheduled by the lender
Financial Assumptions 5% required up front fees for all Individual contracts 5% Sales Commission to be paid to Marketing Supervisors. 3% Sales Bonus for Supervisors 30% Sales Commission to be paid to free lance sales representatives 30% Sales Commission to be paid to the cooperative, when tied up with the cooperative. Salaries for (2) Supervisors @ Php9,000.00, totaling Php18,000.00. (+ benefits and payroll taxes) Salary for the Proprietor to be guaranteed @ Php20,000.00 per month; projected raise to Php30,000 for the next year. Salary for the Office Manager @ Php20,000.00 (+ benefits and payroll taxes). Salary for Administration Assistants @ Php7,000.00 (+ payroll taxes and benefits). Salary for part time people at Php200.00 per hour. Hired as needed to meet volume Licensing permit fees with the Municipality during the year. Water and Electricity at Php1,000.00 per month, and Php12,000.00 per year. 2 Interment Equipment at Php50,000.00 = Php100,000.00 Income Taxes charges at 7.5% of net profits. Estimated Taxes paid on schedule quarterly, based on actual and projected net profits for 2011. • •
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Summary
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The proprietor has the strong foundation to manage and expand the business with his experience: Five years’ experience in the Funeral and Memorial Service Industry. Skilled in sales, support and operations of new accounts for an established memorial plan company. Managed office of 5 employees related to customer service. Proficient in management and workings of the customer service industry. Knowledgeable in landscaping design, and planning. • •
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Experience Diaz Funeral Homes (now Angel Funeral Parlor) Office Manager, Jan. 1972-December 1974 Managed 3 employees that rendered embalming and funeral service. Responsible for planning scheduling, and managing inventory (equipment and tools) for the three employees. Developed a tool “check-in” process saving the company Php1,000 a year in lost inventory. Organized the Barangay Informer that informs the funeral home when somebody died in their barangay for a commission resulting in additional sales revenue of Php25,000.00 Responsible for the schedule of burials Responsible for all employees that worked at the sites •
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Pacific Memorial Plans Sales Supervisor, Dec. 1981 – Dec. 1984 Managed 10 Sales Agents. Responsible for reporting to the Manager all account updates and potential revenue opportunities. Maintained 200 Personal Accounts Trained Sales Agents in proper sales presentation Managed the inventory and supplies of each Sales Agent Managed all customer service issues and received excellence award for all accounts at the end of the year. Scheduled all promotional campaigns and coordinated with higher management • •
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Abiva Publishing House, Inc. Sales and Service Consultant, February 1993 – February 1998 Sold books to private schools Assisted the company in providing seminars for new book releases Got awards as Top Producer in 1997 • • •
Bottomline Interactive Multimedia Speech Laboratory, Present Proprietor and Manager • • • • •
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Jan. 1999 –
Managed 5 employees that sold and installed diagnostic speech laboratory. Responsible for the marketing and sales of the diagnostic speech laboratory. Responsible for designing and making flyers, brochures and sales letters. Personally conducted sales presentations. Responsible for planning scheduling, and managing inventory (equipment and tools) for the five employees. Implemented the first “customer satisfaction survey” over the phone, to the entire base of customer’s. Personally writes copies for the promotion of diagnostic speech laboratory Implemented the Direct Mailing System Organized the telemarketing necessary for the customer survey resulting in additional sales revenue Implemented and managed service issue “hot line” for dissatisfied customers. Responsible for all major accounts and employees that worked at the sites
Personal Strengths Excellent organizational and communication skills Dedicated to customer service excellence Strong management training and experience Strong knowledge of funeral and memorial service industry • • • •
Education College drop out at the University of Mindanao taking Bachelor of Arts. Independent and self trained - buying books that are deemed beneficially useful • •
Affiliations and Interests Past Vice-President of Rotary Club of Toril South Past President of Doňa Carmen Denia National High School Parent Teachers Association President of United Fishermen of Daliao, Inc. Sectoral Representative to the Provincial Agrarian Reform Committee (PARCOMM) Sectoral Representative to the Regional Agriculture and Fisheries Council XI Committee member of the City’s “Beautification Program” in 1987 Member of Technical Assistance for Community Development for Rural and Urban Planning Volunteer Consultant of Happy Valley Ventures, Inc. Copywriter of Happy Valley Ventures, Inc. and Bottomline Interactive Speech Laboratory and Educational Technology • •
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PREPARED AND SUBMITTED BY:
BERNARDO F. BASMAYOR, TQM Tel. No. 09205394711 Email:
[email protected]
