A Feasibility Study of Establishing a Pawnshop in General Santos City
CHAPTER I
INTRODUCTION

This chapter discusses about the background of the study, rationale of the study, objectives of the study, significance of the study and definition of terms.

Background of the Study
Too many people are in difficulty today due to economic or unstable economy people may find an alternative way to find a solution to their problems, many of them go to the houses of the creditors owing money to be able to meet their needs even in a small amount, but sometimes they cannot borrow money because they have not paid their first loan. So, people will go to other areas to take instant cash. Some will apply a bank loan, and wait for an answer only to be able told that they are denied. That’s why people will go to their local pawnshop for much need help. Pawnshop brokers are seeing people from all walks of life pawning everything that has value that will put the cash they desperately need in their hands when they need it. (www.business.whatitcosts.com) 1
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Pawnshop is a store which offers loans in exchange for personal property as equivalent collateral if the loan is repaid in the contractually agreed time frame, the collateral may be repurchased at its initial price plus interest. If the loan cannot be repaid on time, the collateral may be liquidated by the pawn shop through a pawnbroker or secondhand dealer through sales to customers.
(http://www.businessdictionary.com)
As a result, the researchers choose to study this kind of business to understand the needs of the people within the community of General Santos City. This serves as an opportunity to the business to cater the needs and wants of those pawners looking for low interest rate of their pawned items. This kind of business will be more liked by the people who needs money immediately because, this business is the common and quickest way to address an urgent need for small amount of cash not offered by other institutions or banks.
Rationale of the Study This study was conducted because pawnshop is a highly in demand business especially many people nowadays are facing an economic problem or financial crisis due to economic changes and unstable economy and expected to produce profit out of this demand in the city. However, many people engaged in this kind of business, the researcher still want to invest because of the market size and increasing demand and population in the city. These also supply those customers who cannot be accommodated by the existing players in the industry. In addition, it can provide employment to the job seekers in the city and it will contribute to the country’s development through payment of taxes.

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Objectives of the Study
Specifically, it aims to determine the viability of the proposed pawnshop in General Santos City.
Specifically, it aims to: 1. Describe the Pawnshop Industry in General Santos City. 2. Determine the viability of establishing a Pawnshop in the following aspects: a. Marketing Aspects; b. Technical Aspects; c. Management and Organization; d. Financial and; e. Socio-Economic
Scope and Delimitation This study sought to determine the viability of Pawnshop in General Santos City conducted in 2014. The scope of the study covered the three existing players namely; Elnaki Pawnshop in Daproza St., Rd Pawnshop in J Catolico St., and Henry Lhuillier Pawnshop in Cagampang St. The historical background of the study was taken from the secondary sources; internet, books and magazines. The primary data was taken from interviewed players in the industry using interview guide to ensure that the information is relevant to the study. It covered the viability of the following areas: Marketing, Technical, Management and Organization, Financial, and Socio-Economic.
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This study is limited only in General Santos City. We started searching an establishment in the third week of June 2014 and it ends on the first week of July 2014. We conducted our interview thrice a week in the morning. There are many pawnshops here in General Santos but only few are agreed to conduct an interview to them. For us, there is no big and small establishment as long as it’s a pawnshop and we try our best to get the approval.
Significance of the Study
This study is beneficial to the following:
The Owner- in this study he/she could attain some of the benefits. And there are opportunity to gain profit from establishing this kind of business, and a possibilities of a higher capitalization return.
The Manager- the result of the study helps him/her the idea on how to operate and develop business effectively, throughout their skills on proper management that could lead to their success.
The Customers- the proposed business will also benefit this study through the information that there is existing pawnshop in the city, by that they can invest there valuable item in exchange for money.
Future Investors- the result of this study helps the future investors to engage and invest in this kind of business because of the high demand of pawnshop in the industry.
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The Employees- the result of the study help them to know what characteristics they should possess to achieve certain position.
The Researchers- are informed and will have an undertaking or schemes that involves some risks and have an idea how it operate, and who can benefit.
Future Investors- this study will basically help future investors enhance their skill as well as ensure that they are getting specific strategies on how to operate the business.
The Local Government- the result will help minimize the unemployment problems of the community. The local government can benefit because of the taxes that came from it.
Research Methodology This part of the study discusses about the research design, respondents, locale of the study, data gathering tools, data gathering procedure. It will enable the reader to understand the research process
Research Design The researcher used a descriptive analysis method of research. Descriptive analysis is a discipline that describes the current situation of existing phenomena. This type of study follows creative exploration to serve to organize the findings in order to fit them on explanations to test or validate an explanation. This is more helpful in analyzing the data gathered from the respondents in the aspects of marketing, technical, management and organization, financial and socio-economic. The research design shows the flow of operations in conducting the study. Figure 1 show the Research Design of the proposed business.
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A Feasibility Study of Establishing a Pawnshop
A Feasibility Study of Establishing a Pawnshop

Industry Analysis
Industry Analysis
Research Methodology
Research Methodology

Description of the Business
Description of the Business
Research Design
Research Design

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Socio-Economic
Socio-Economic
Management and Organization

Management and Organization

Technical
Technical
Objectives of the Study
Objectives of the Study
Marketing
Marketing
Financial
Financial
Figure 1
Research Design

Research Design
Figure 1
Research Design

Research Design
A Feasible Pawnshop in Brgy. Lagao
A Feasible Pawnshop in Brgy. Lagao
Internet
Internet
Questionnaire
Questionnaire
Data Gathering Procedure
Data Gathering Procedure
Interview Guide
Interview Guide
Data Gathering Tool
Data Gathering Tool
Elnaki Pawnshop
Elnaki Pawnshop
Henry Lhuillier Pawnshop
Henry Lhuillier Pawnshop
Rd Pawnshop
Rd Pawnshop
Respondents
Respondents
General Santos City
General Santos City
Locale of the Study
Locale of the Study
Descriptive Analysis
Descriptive Analysis