Chapter I
Introduction
Name of the Project
Bamboo is one of the agricultural resources abundant in Eastern Visayas and remains underutilized until recently because of the lack of information on economic, financial, technology and market prospects and the fragmented efforts among the key supply chain players. While there are existing bamboo farming, trading and processing initiatives, these are primarily customer-driven and is a reaction to sporadic demand.
Abundance of this bamboo in the country is one to take advantage of. That’s why we choose to build a bamboo business. Our business is named BAMBOOGLE. It is a general partnership business of a manufacturing type. The partnership were composed of the following members namely: Jestoni Gomez and LiezlVillacarlos (general partners), LeylangenCinco (managing partner) and JonalynMontera (limited partner). Our business complies all legal and regulatory requirements.
Location
Our business is located in Tanauan, Leyte. A place just ____meters away from the downtown and is conveniently accessible by residents even from nearby towns in just few minutes ride via any form of transportation vehicles. Our office will be located just near the plantation and manufacturing area in order to minimize cost.
Descriptive Definition
Our project is a manufacturing type of business producing products relating to Engineered bamboo or e-bamboo primarily bamboo tiles. This is commonly done by processing the bamboo pole by laminating or gluing two or more layers of crushed, split or veneered bamboo. This can be further converted into handicrafts, boards as our by products.
The project involves overall site development covering 15,000 square meters. This site development covers plantation area and office area. The total site development budget cost is P8M.
Our office site will be constructed near the manufacturing and plantation area.
Long range objectives
Needless to say, businessmen wanted their business to be successful and to contribute more in society by means of implementing corporate social responsibility. We, the partners in Bamboogle would likewise practice this mindset. Other than aiming primarily to generate stable revenues, we would also make our counterpart in promoting an environment-friendly business.
Furthermore, the following are the long range objectives of Bamboogle:
* To gain profit * To become one of the leading producers of e-bamboo products in Leyte. * Present potential economic contributions of e-bamboo industry in Eastern Visayas.
Feasibility Criteria
a. Financial Viability
Our company is targeting an average yearly income of more or less 800,000 (inclusive of taxes and other operating expenses) from this project which can sustain its long term operation.
We would ensure further that the return of investment of each stage of production and the payback period would be indicative of competitiveness and viability of the business.
b. Flexibility and Functionality
Tiles made of bamboo have a great impact in the minds of people who wish to have floorings in their houses for it offers a more convenient effect to them. In comparison with China products, the locally produced e-bamboo presents price competitiveness as it can be offered within or even lower for as long as the key enterprises in the supply chain, i.e. plantation, nursery, node and hub will operate efficiently. The value chain approach is necessary in order to ensure sustained development. Our natural and organic tiles will ensure various sources of income and this attracts more people to come to the market, increasing sales opportunities for the market occupants. The ensured functionality of the utilities and services would draw more business takers from other places in the region.
c. Stability of Opportunities in the Industry
Having a wide range and technical knowledge in business and accountancy, entry of competitors is not a problem for we will also hire competitive personnel who is knowledgeable and has an expertise in e-bamboo business. Moreover, we will ensure that we could offer quality bamboo tiles (and others) at an affordable cost and could satisfy the convenient preference needs of customer. Furthermore, bearing the fact that this business is rare in Leyte, our company would surely be patronized and conduct advertisements in radio and internet. Furthermore, we will also offer our products online. Municipal ordinances, policies and regulation are expected to favor the sustainability and feasibility of the project.
Highlights of the Project
Our business mainly produces industrial e-bamboo products made primarily bamboo tiles. Bamboo boards, plybo ,and other finished processed bamboo items is our by product. Our items a bamboo tile is composed of 5 classes of designs while bamboo boards and other finished process bamboo items are jointly produced as a by-product.
Project Timetable
Before the project can fully operate the following stages of tasks are involve:
a. Forming and organizing the BAMBOOGLE Partnership business. Investments were as follows:
Jestoni Gomez (General Partner) has a profit share of 2/4 and will contribute a cash of 2.5 M.
Leylangen Cinco (General Partner) has a profit share of 1/4 will contribute land in Tanauan plus 1 M.
Liezl Villacarlos (Managing Partner) will contribute her industry and would just have a fixed salary.
Jonalyn Montera (Limited Partner) has a profit share of ¼ and will contribute a cash of 1 M.
b. Enactment of local expropriation act authorizing local executive to expropriate the land to be used for this business and authorizing the local executive to enter into contract with any construction company and partnership with any private individual who can finance the project.
c. Securing business permits and licenses required before the construction could start.
d. The construction phase of the project.
e. Formation of the management setup for the newly formed public market.
From the inception period until the project could fully open and operate, it requires a period of eight (8) months as shown by the program of work through the gantt chart.
Nature of the Industry
The economic ability of the middle class families in Eastern Visayas ranging an income of 20,000/month and up suggests an upward trend in terms of number of households according to the data presented by the National Statistics Office Leyte. This positive development is likewise evident in some neighboring regions. Thus, given this kind of business environment this project is deemed timely, appropriate and viable even at the succeeding years. Failure to pursue this project as early as this time would mean a big loss of income opportunity and would put the town behind in terms of economic progress.
Mode of Financing The project is financed primarily by the partners and other agencies offering assistance in this Bamboo Business. The amount appropriated is complemented by any individual investors and those who wish to become one of the partners. Further cash requirements would be financed by obtaining loans.
Investment Costs
The project requires a total amount of 4,169,858.65 to normally and fully commence its operation. The amount includes the site development, construction of the buildings, and initial operating capital.
(Based on estimate in research conducted by: Regina Irene A. Gaza (Bamboo Tile Business) )
Market Feasibility
The project is expected to accommodate about 80% of the middle class families with a range of monthly income of about 20,000 and up. From this commanding share of the market, an average yearly income of P500,000 is highly possible. These expectations are highly probable considering the proponents control over the business atmosphere. It is expected that any promulgated policies and ordinances are in favor to the interest of the project.
Likewise, the observed population growth of Leyte and neighboring regions and stable growth of number transport franchises are helping for the viability of the project even on succeeding years.
Management Feasibility
To minimize operational costs, the project must ensure conservative but efficient costing methods and techniques. From recruitment to hiring it is assured that people with technical knowledge in e-bamboo production, with competence, teamwork and service oriented are to be hired.
At construction stage of the project, required skilled workers must come from town only. This is one way of helping the residents. Skilled worker not having an adequate experience in this type of business would be shouldered by the company to undergo further technical training in cooperation with agencies supporting this business. At full operation periods the project entails fourteen (14) personnel composing the production manager, supervisory level, finance, down to utilities and maintenance.
The structure of operation shows cohesive teamwork from the top management to the public market occupants or associations.
The Mariano Marcos State University [MMSU] presents the production process in producing bamboo tiles, one of the by-products of a hub as outlined below:
MMSU Model: Steps/Process of Making Bamboo Tiles
1) Fresh or partially dried bamboo poles
2) Pole cross-cutting to 8 ft
3) Boiling
4) Kiln Drying
5) 20-30 mm width sizing
6) Manual separation of slats
7) Thickness sizing
8) Strips sides jointing
9) Color matching
10) Manual gluing
11) Clamping or hydraulic pressing
12) Re-jointing and squatting
13) Thickness planning
14) Sanding
15) Finishing coat
16) Quality control
17) Finished Products
Laminated board
Dried, cut and rejoined, planed slats of bamboo wider than bamboo tiles used as alternative for plywood
Bamboo veneer
Laminated, bamboo-covered plywood produced by rotary cutting of bamboo using rotary lathe and laminating bamboo veneer.
Panel Door
Thicker than laminated board used as door for houses.
Ply Bamboo [Plybo]
Layered flattened bamboo sheets used as alternative for
Plywood
Furniture
Furniture, fittings, fixtures, equipment and other finished stuff utilizing laminated
Board and planks as replacement for timber
Handicraft
Hand-made crafts from e-bamboo
Material
Ply Bamboo [Plybo]
Layered flattened bamboo sheets used as alternative for
Plywood
Furniture
Furniture, fittings, fixtures, equipment and other finished stuff utilizing laminated
Board and planks as replacement for timber
Handicraft
Hand-made crafts from e-bamboo
Material
Raw Material Requirement
The raw material requirements for Plantation, Nursery, Node and Hub are enumerated below: 1. Plantation Raw Material | Description | Requirement | Cost [Php] | Bamboo seedling | also termed as propagule or potted cuttings, 4-6 months old depending on the method and specie | 1 piece/clump or 240 seedlings for 1 ha. Plantation [with 20% mortality rate] | P20.00/piece 360,000 | Fertilizer | chemical and natural fertilizers used in nourishing the clump | 1.2 kgs/clump/year or 240 kgs/year for 200 clumps/year | 13.50/kg or 3,240 for 200 clumps/year |
2. Node Raw Material | Description | Requirement/slat | Cost | Bamboo pole | bamboo stem that is not less than 3 year old | 50 poles/day or 15,000 poles [on the 1st Year] | P25/pole P375,000 [on the 1st Year] | Treatment Material | chemical added to water and used in treating bamboo | 2.5grams/slat or 1,200 kgs. for 480,000 slats [on the 1st Year] | P170/kg or P204,000 for 480,000 slats [on the 1st Year] |
3.HubRaw Material | Description | Requirement/sq.ft. | Cost | Slats | bamboo sticks with dimensions of: 5mm x 1inch x 4 ft. | 6 slats or 480,000 slats for 80,000 sq.ft. tiles/planks/plyboo/ laminated board | P3.00 or P1,440,000 for 80,000 sq.ft. tiles/planks/plyboo/ laminated board | Glue | adhesive use in assembling and laminating bamboo slats | 50 grams or 4,000kgs for 80,000 sq.ft. tiles/planks/plyboo/ laminated board | P130/kg or P520,000 for 80,000 sq.ft. tiles/planks/plyboo/ laminated board | Lacquer | clear or colored varnish used for curing bamboo | 10 ml or 800 liters for 80,000 sq.ft. tiles/planks/plyboo/ laminated board | P30/liter or 24,000 for 80,000 sq.ft. tiles/planks/plyboo/ laminated board |
Socio Economic Feasibility
Given all other considerations favorable to the project's viability, it is therefore expected that the project would bring sufficient revenues. Above all, the project will propel an expanded e-bamboo business environment in consideration of opportunities and location resulting to more jobs and income to the residents of Tanauan, Leyte.
Chapter II
Market Study
Market Demand for Engineered Bamboo
(based on research conducted by: Regina Irene A. Gaza)
Traditionally, the market for bamboo products were communities located within the range of the plantations. Bamboo was used basically as raw material distributed amongst industries and sectors for making traditional furniture and handicrafts using the whole bamboo poles or parts of it for construction of houses, animal cages, and fences, etc.
The application of technology expanded the market for bamboo. The development of e-bamboo such as laminated panels, ply, veneer, tiles and planks have opened an emerging market in the furniture and construction sectors not only in the Philippines but also in different parts of the world. Since the 19th century, China has been producing bamboo panels. However, it was only in the mid ‘80s when massive development on e-bamboo has been explored as a valuable substitute for wood. Bamboo replaces wood in many industrial applications including bamboo housing and modern construction materials as flooring, roofing, partitions, window and door frames and even in the production of furniture and handicrafts. Major importers of bamboo products as reported by the International Network for Bamboo and Rattan [INBAR] in 2004 are the European Union, Hong Kong, Japan and the US. This report however, did not provide specific detail on the volume of trade for engineered bamboo1 .
Based on the published prices of e-bamboo products by CaliBamboo2 , a company in China, the average price for ¾ inch thick, bamboo plywood is USD 6.09/sq.ft. or USD 195 with 4ft. x 8 ft. size. In comparison with the existing locally manufactured ¾ inch thick, bamboo plywood with introductory price ranges from Php60 to Php100 or USD 1.40 to USD 2.33 per square foot, the Philippines has a potential to compete in terms of price with China.
In the domestic setting, e-bamboo is at its infancy stage. It was only in the year 2009 when the government started to seriously promote and engage the private sector to invest and manufacture e-bamboo and its by products. China e-bamboo planks [with dimensions of 960mm x 96mm x 15mm and is almost equal to 1 sq.ft.] are being sold at Php 153.75 to Php 193.33 or USD 3.58 to USD 4.50 at Citi Hardware in Iloilo. This further supports the price competitiveness of locally manufactured e-bamboo products in comparison with China products. 