Professional Documents
Culture Documents
) INTRODUCTION
Recording studio is a facility for sound recording. Ideally, the space is specially designed
to control audio reflections. Different types of studios records bands and artists, voiceovers and
music for television shows, movies, cartoons, and commercials, and/or even record a full
orchestra.
This is a study that has been conducted in order to measure the recording industrys
capability to survive under a different market conditions as well as to meet the peoples demand
of such enterprise. It also seeks the resources needed with its corresponding amounts in order for
the proper allocation of the resources.
The Studio was named Rockoholic because many people are addicted in music. The
Rockoholic recording studio will be located at Matina Town Square fronting Ateneo de Davao
University Grade School building. The studio is located right wing of the Matina Town Square
vicinity.
We gathered a lot of data given by the different establishments. We interview some
persons who have a lot of knowledge about music and by observing and studying the
informations given. We also make use of our little knowledge about music because most of us
are member in the band and also tried recording. Our data gathering started on the month of
January, year 2007 and what we did was we went to different kinds of recording studio, practice
studio and music stores here in Davao City. We ended on the month of January, year 2008. We
make use of our critical minds and careful analysis in order the study will be sufficient and
adequate.
The names of the Entrepreneurs with their cell phone numbers are the following:
Joseph Gubantes
09192276613
Johnwyn Maruhom
09187103063
Joshua Paguican
09205113146
Kashmeruddin S.Abdul
09283112548
09176981592
A. Situational Analysis
1. Industry Analysis
a. Industry Background and Overview
Our company, which is the Rockoholic, belongs to the recording industry. The
said industry is not that big because it is just 12% of Davao Citys total industry, and been
recognize for almost 10 years in Davao.
Rockoholic is a full service recording studio that provides a high-class / highquality sound using the new Equipments and offers the following:
Sound quality
4
Digital Mastering
Arranging / composing
The total industry sales for the past five years were, 2003 has P6,108,658.00. On
2004, it increased to P8,952,341.00 and on 2005 decreased to P5,361,752.00. But for
2004 and 2005 was P7,668,431.00 and P9,253,224.00 respectively.
b. Growth Rate
The anticipated growth rate in this industry will be positive and expecting that the
Return of Investment will be 25% of this coming year. There were only 1 new firm who
entered this industry in the last three years. The new service that the said firm introduced
in the industry were high quality and well maintained equipments. Our competitors
sales were changing depending on the different factors, as what was shown on the graph
below.
Figure 3.1
Sound Quality
Service
Polyfusion
Polyfusion
Mix a Tune
Rockoholic
Mix a Tune
Rockoholic
Equipments
Polyfusion
Mix a Tune
Rockoholic
city have been acquainted to their services. They were known as the sound technicians of
music in the region. Their strategies in attracting customers to avail their services are simply
by way of advertising through local radio stations and by sponsors. In this way, they make
the people aware to their services. Potential customers in our target market avail there
services as of now because there is no other good services that provides such services that
they need and if they want to avail a better service, they will have spend more money
because high quality recording studio are situated somewhere in Manila which would lead
them to cost more.
After giving out questionnaires, we have identified some of the major concerns of
the people to about the recording studio services. Through these, we can distinguish our
services from theirs. Existing recording studios have some weaknesses as shown in the
illustration below. We can use this information in order to cover up their weaknesses in our
proposed recording studio. Covering up their weaknesses can make our recording studio a
high class studio and these involve a high quality sound, clean and well maintained, and
spacious studio with a friendly staff. We can distinguish our services from theirs in this way
and we can attract more customers.
Figure 3.2
(The following illustration shows Strengths, Weaknesses, Opportunities and Threats of Polyfusion and Mix-a-Tune Recording
Studio.)
POLYFUSION
MIX-A-TUNE
Strengths:
Opportunities:
Strength:
Good quality
Increasing
New
of sound
number
of
equipments
aspiring bands
Efficient
in
Friendly staff
or local artists
recording
Highly
National
Used hi-tech
maintained
music
equipments in
Clean facility
competition
recording
that requires
demo
from
Opportunities:
Increasing
number
of
aspiring bands
or local artists
National
music
competition
that requires
the
artists
local
Weaknesses:
Threats:
Weaknesses:
Threats:
Lack
of
Increasing
Small space
Increasing
maintenance
number
of
for recording
number
of
to
their
music studios
music studios
Crowded
equipments
who have the
who have the
potential
to
potential
to
Old and dirty
offer
a
offer
a
facility
recording
recording
services
services
(The chart illustrates how big their market is.)
(57 percent of the total local artists and bands in the region have chosen Mix-a-Tune recording
Studio as the most excellent studio.)
b. POTENTIAL COMPETITORS
WHO: Aside from the existing recording studios locally, we also assume that theres a lot more
competitors in the future. Those competitors are capable of building a recording studio that is in
harmony of making the public satisfied with what the Rockoholic aims at. The Potential
Competitors would be the department stores that are selling musical equipments. This would
include malls and appliances stores.
WHEN: Competitors will surely appear if our business, The Rockoholic, would be successful
and be in-demand locally. Based on our study, this business will shine to the public after several
years or maybe more or less 3 years after the business is put up.
WHY: Practically speaking, competitors will take place simply because they want to take advantage also
of the financial capability or the ability to earn high on this type of business. Based on our survey, at
present, the recording studio locally does not satisfy the customers. We believe that the Rockoholic will
absolutely provide the necessary or all the demands of the people where in they could not find it in the
present existing recording studio locally. Thats the nature of competence, to imitate once business, that
click the market. All of us wants to earn more than the others, thus potential competitors arise because of
money. Competitors will try all their best to attract the people who are in demand of a good recording
studio.
Figure 3.3
ADVERTISING EXPENSE
DESCRIPTION
QUANTITY
UNIT
AMOUNT
Banner
Pieces
270.00
1,350.00
Poster
10
Pieces
600.00
6,000.00
Leaflets
100
Pieces
2.60
260.00
Radio
Radio Station
8,000
8,000
TOTAL
TOTAL AMT.
15,610.00
(The table shows the following composition of the Companys advertising expense and the
projected amount on the advertising expense)
11
1. Applicant must secure two copies of registration form and pay Php 500 for the
registration processing fee.
2. Accomplish DTI Form no. 16B.
3. If the partnership is fully owned by an alien or the capital of which is more
than 40% owned by aliens, the SEC Certification must specify that it is in accordance
with the foreign investment Act of 1991.
4. In case there is an increase of capital, submit certificate issued by SEC.
Partnership using only its registered corporate partnership or cooperative names may
no longer register under the Business Name Law.
An applicant who maintains a business with branches must register the main business
and every branch thereof.
Present your DTI Certificate of Business Name the fill up the application form.
Get the printed application and process the application by letting sign the authorize
government agency reflected in the application, like
1. Real Property tax-in-charge
2. Notarization of lawyer worth P50
3. Business bureau assessment
12
Secure a partnership residence certificate (Cedula) worth P500.00 from the barangay.
Pay to cashier the corresponding amount as assessed by the assessment division for
the first quarter of operation.
Submit the application to the Business Bureau for a LOGO or for a Business permit.
i. Organizational Chart
Figure 3.4
Owner
Manager
Senior Technician
Cashier
14
Maintenance
Supervisor
Assistant
Technician
Maintenance
Personnel
(The chart shows the structure of the Company Top Management (Owner and Manager), Middle (Bookkeeper, Cashier, Senior Technician and Maintenance Supervisor), and Lower Management
2.) Personnel
1.) Manager
15
4.) Cashier
-
The person responsible for computing the amount due for the service charge
of the consumer.
16
Job specification
Manager
Senior Technician
Qualifications
-
Pleasing personality
Music lover
20 years of age
Maintenance
Supervisor
Knowledgeable
instruments.
17
in
working
with
musical
Cashier
Assistant Technician
.pleasing personality
Pleasing personality
Maintenance
personnel
Gross pay
SSS
Phil
Pag-IBIG
Health
Withhol
Net Pay
ding Tax
Manager
10000.00
333.30
125.00
200.00
1208.00
8133.70
Senior Technician
8500.00
283.30
100.00
170.00
1008.00
6938.70
Maintenance
8000.00
266.70
100.00
160.00
858.00
6615.30
Cashier
6000.00
200.00
75.00
120.00
483.00
5122.00
Assistant Technician
5,500.00
183.00
75.00
110.00
530.00
4602.00
Supervisor
18
Maintenance Personnel
5,000.00
166.00
70.00
105.00
510.00
4149.00
Total
43,000.00
1,432.3
542.00
865.00
4,597.00
35,560.70
(The table shows the following cost of the companys salary and benefits)
D.) Facilities
The Rockoholic recording studio will be located at Matina Town Square fronting Ateneo
de Davao University Grade School building. The studio is located right wing of the Matina
Town Square vicinity. The size of the place is 70 sq. meters with a rental rate of Php. 395.50/ sq.
meter. The contract for renting the place would be Php. 90,000.00 for five (5) months. And the
total monthly rate would be Php. 27,685/ month. The payment may be made in cash or through
check.
The studio is composed of 5 rooms and a reception area. Upon entering the studio, you
will see the reception area where you find the cashiers desk. Situated behind the cashiers desk
is the managers office. The next room is the storage room and followed by the editing bay. The
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rooms parallel to the managers office is the practice room. The door positioned at the end of the
hallway is the location of the recording room.
20
21
Equipment / Technologies
The equipments that the company will be using are first-class because it came from
the different well-known stores in the Philippines which are known in terms for their high-end
and technologically advanced equipments and gadgets. The brands of our equipments for
recording studio are the following - M-Audio ProjectMix I/O Control Surface, Laney LC15R
Electric Guitar Valve Amplifiers Combo, Squier Affinity Stratocaster Electric Guitars RW Black,
Squier Affinity P-Bass Guitar RW Brown Sunburst, Collins DCM57 Dynamic Instrument
Microphones, Korg microX Keyboard Synthesizer White, Pearl Vision VLX 5-Piece Standard
Drum Set, 1 Metre Mono Jack to Mono Jack Cables, Fender Bassman 100 100-watt Bass Combo,
AKG K171 Closed Back Studio Headphones, Event TR8 Tuned Reference 8 Active Studio Speaker
(Pair), Edirol OP-R09C Microphone Stands R-09, Arturia Moog Modular V Software Synthesizer, Collins
CC120 Classical Acoustic Guitar and a Computer.
22
For our practice studio, these are the following equipments - Behringer GM108 V-Tone
Modelling Guitar Combo Amplifiers, Yamaha Pacifica 012 RM Electric Guitars Red Metallic, Ibanez
SR900 TKF Electric Bass Guitar Trans Black Flat, Collins DCM57 Dynamic Instrument Microphones,
Korg microX Keyboard Synthesizer White, Pearl Vision VLX 5-Piece Standard Drum Set, Fender
Bassman 100 100-watt Bass Combo Amplifier, Edirol OP-R09C Microphone Stands R-09, and 1 Metre
Mono Jack to Mono Jack Cables.
Equipment
Quantity
Amount
Total
Useful
Depreciation
Net Book
Life
Value
Value
43,667.00
43,667.00
10
4,366.70
4,366.70
16,100.00
48,300.00
15
1,073.33
3,220.00
8,857.00
17,714.00
1,771.40
3,542.80
10,142.00
10,142.00
2,028.40
2,028.40
Collins
DCM57
Dynamic
Instrument Microphone
2,415.00
9,660.00
483.00
1,932.00
23
Korg
microX
Synthesizer White
Keyboard
26,973.00
26,973.00
10
2,697.30
2,697.30
5-Piece
27,076.00
27,076.00
10
2,707.60
2,707.60
245.00
1,470.00
49.00
294.00
15,138.00
15,138.00
15
1,009.20
1,009.20
4,830.00
19,320.00
966.00
3,864.00
25,200.00
25,200.00
10
2,520.00
2,520.00
Edirol OP-R09C
Stand R-09
1,200.00
4,800.00
10
120.00
480.00
15,000.00
15,000.00
3,000.00
3,000.00
6,420.00
6,420.00
1,284.00
1,284.00
Computer
35,000.00
35,000.00
7,000.00
7,000.00
31,075.93
39,946.00
Microphone
TOTAL
31
238,263.00
305,880.00
24
Equipment
Quantity
Amount
Total
Useful
Depreciation
Net Book
Life
Value
Value
16,100.00
48,300.00
10
1,610.00
8,045.00
16,090.00
1,609.00
3,218.00
10,100.00
10,100.00
2,020.00
2,020.00
2,415.00
4,830.00
483.00
966.00
26,973.00
26,973.00
10
27,076.00
27,076.00
10
2,707.60
2,707.60
15,138.00
15,138.00
15
1,009.20
1,009.20
Edirol
OP-R09C
Microphone Stand R-09
1,200.00
1,200.00
10
120.00
240.00
245.00
980.00
49.00
196.00
TOTAL
17
107,292.00
150,687.00
12,305.10
17,884.10
2,697.30
Additional Equipments:
Guitar Strings
Bass Strings
10 sets
PHP150.00/set
PHP1,500.00
5 sets
PHP550.00/set
PHP2,750.00
PHP245.00
PHP 490.00
25
4,830.00
2,697.30
Guitar Ampliifier
(Extra)
PHP16,100.00
Total
PHP36,940.00
PHP493,507
Custome
r
Process Flow
Select
Service
26
Reservatio
Practice
PHP32,200.00
Recording
Instrument
set up for
recording
Preparation of
instrument
Practice
Payment
Inspection
and
keeping
the
instrument
Preparation
of
instruments
Record
Mixing /
Editing
Rental
Inquire
reservation
Down payment
Preparation
of
instruments
Deliver of
instruments
Transfer to CD
Set up
instrument
Payment
Process Flow
Payment
(Recording Studio)
27
possible. After having the necessary preparations, the customers are then allowed to perform.
During their performance, the technician is prepared for whatever problems that will occur. After
the customers are finished with their practice session, they will pay to the cashier while the
maintenance supervisor and his personnel inspect the condition of the equipments and
instruments recently used.
For customers who want to record in our studio
The customer must go to the cashier first to inquire. This will give time for the technician
to prepare the necessary instruments for recording. This would include preparation of the
computer and mixer. Next, the instruments would be prepared after the preparation of the
computer and mixer. After having the necessary preparations the customer then would start the
recording session. After the customer is done, mixing and editing would follow. This process
would involve the technician and customer himself. Editing and Mixing is aimed on giving the
customer on what type of quality sound he prefers. After the customer is satisfied, the mixed and
edited piece would then be transferred to a compact disc (CD). After transferring to the compact
disc, the customer then would pay to the cashier.
remaining balance when returning the rented instruments. The returned instruments and
equipments will be checked by the maintenance supervisor and his personnel.
29
that there would be 2,100 customers who will avail our services. 1,300 of these customers
came from recording service while the remaining 1000 customers are from practice
service. In the second year of operation, there 3,100 customers. 1,900 customers are from
recording while 1,200 customers are from practice. In the third year, there would be
3,900 customers. 2,500 customers are from recording while the remaining 1,400
customers are from practice.
2. Initial working capital would be P 100,000.00.
3. The expenses of the Rockoholic Recording Studio are assumed to be fixed and variable.
Fixed expenses are composed of Salaries and Wages, Depreciation (Straight-line
method), Telephone, Electricity, Water, Maintenance, Office Supplies, Advertising, Rent,
SSS premiums, Philhealth premiums, and PAG-IBIG premiums. Variable Costs include
installation costs and organization cost.
4. Straight-line method would be used in computing for the depreciation of the equipment
and furniture.
5. Advertising expense in the 2nd year and 3rd year would only be composed of leaflets and
Radio.
6. There will be no salaries for the first year to cover up for the expenses.
A.) Project Cost
30
Capital, and Initial Advertising cost. The computation for the total project cost is shown as
follows:
Definition
Organizational Cost
Purchase of Equipment:
Practice Studio (table 1.2)
Recording Studio (table 1.1)
Additional Equipments
Sub-Amounts
150,687.00
305,880.00
36,940.00
493,507.00
161,532.00
56,000.00
9,000.00
3,000.00
9,600.00
4,680.00
26,280.00
1,000.00
100,000.00
1,350.00
260.00
6,000.00
8,000.00
Electricity
33,286.20
Telephone
3,000.00
Water
Initial Rent Payment
Amounts
14,120.00
15,610.00
868,049.00
450.00
36,736.20
(table 1.7)
83,595.00
P990,380.20
Rockoholic Recording Studio
INCOME STATEMENT
As of December 31, 2007, 2008, 2009
2007
Service Revenue
Gross Income
Operating Expenses:
Salaries & Wages
820,000.00
820,000.00
0
2008
1,155,000.00
1,155,000.00
426,728.40
31
2009
1,525,000.00
1,525,000.00
426,728.40
Water Expense
Electricity Expense
Telephone Expense
Advertising Expense
Maintenance Expense
Depreciation Expense
Rent Expense
SSS Premiums
Phil Health Premiums
Installation Cost
Office Supplies
Expense
Total Operating
Expense
Income before tax
Less:
Income taxes (35%)
Net Income/loss
1,800.00
133,144.80
12,000.00
187,320.00
4,500.00
87,360.38
334,380.00
17,187.60
6,504.00
1,000.00
1,800.00
133,144.80
12,000.00
99,120.00
4,500.00
87,360.38
334,380.00
17,187.60
6,504.00
1,800.00
133,144.80
12,000.00
99,120.00
4,500.00
87,360.38
334,380.00
17,187.60
6,504.00
22,620.00
13,032.00
13,032.00
807,816.78
12,183.22
1,135,757.18
19,242.82
1,135,757.18
389,242.82
4,264.13
7,919.093
6,734.99
12,507.83
136,234.99
253,007.83
32
913,959.67
2009
1,013,827.89
913,959.67
1,354,196.09
1,013,827.89
1,354,196.09
493,507.00
26,280.00
161,532.80
56,000.00
737,319.80
493,507.00
26,280.00
161,532.80
56,000.00
737,319.80
493,507.00
26,280.00
161,532.80
56,000.00
737,319.80
2,628.00
11,200.00
57,830.10
16,153.28
87,811.38
5,256.00
22,400.00
115,660.20
32,306.56
175,622.76
7,884.00
33,600.00
173,490.30
48,459.84
263,434.14
Total Assets
Liabilities
Current Liabilities:
Total Liabilities
Equity
Partners Equity
2008
1,525,548.99
33
619,508.42
561,697.04
473,885.66
1,533,468.09
1,575,524.93
1,828,081.75
0.00
0.00
0.00
1,563,017.10
1,575,073.92
Net Income
Total Liabilities and Equity
7,919.093
12,507.83
1,533,468.09
34
253,007.83
1,575,524.93
1,828,081.75
The Rockholic Recording studio has a net income of P7,919.093 on its first year,
P12,507.83 income on its second year, and P 253,007.83 income on its third year. This shows
that income increases by each year. The company has recovered from the first year of operations
to the second year of operation. The sales of the company increased by 96.87% from the first
year of operations to the third year of operations
Year 2
Year 3
1,500,000.00
913,959,67
1,013,827.89
820,000.00
1,155,000.00
1,525,000.00
2,320,000.00
2,068,959.67
2,538,827.88
1,800.00
1,800.00
1,800.00
Telephone Expense
12,000.00
12,000.00
12,000.00
Electricity Expense
133,144.80
133,144.80
133,144.80
35
Installation Cost
1,000.00
Maintenance Expense
4,500.00
4,500.00
4,500.00
334,380.00
334,380.00
334,380.00
Office Supplies
22,620.00
13,032.00
13,032.00
SSS
17,187.60
17,187.60
17,187.60
6,504.00
6,504.00
6,504.00
426,728.40
426,728.40
4,264.13
6,734.99
136,234.99
Advertising
187,320.00
99,120.00
99,120.00
Equipments
493,507.00
1,406,040.33
1,055,131.79
1,184,631.79
Excess
913,959,67
1,013,827.89
1,354,196.09
913,959,67
1,013,827.89
1,354,196.09
Rent Expense
Philhealth
Salaries
Income Taxes
Furniture
Renovation/Leasehold
Total Cash Disbursements
26,280.00
161,532.80
36
D.)Return on Investment
The formula for Return on Investment is Earnings before interest and taxes/total assets.
Based on the projected balance sheets and income statements, the Return on investment on year
2007 is .8% In year 2008, the return on investment is 1.22%. And in year 2009, the return on
investment is 21.29%. The results showed that after the first year, the recording studio has found
ways to utilize their assets more to contribute more income to the recording studio. The Return
on investment on each year is computed as follows:
Year 2007
P 12,183.22/ 1,533,468.09
= .8%
Year 2008
P 19,242.82/ 1,575,524.93
=1.22%
Year 2009
P 389,242.82/1,828,081.75
=21.29%
37
Year 1
Sales
Year 2
820,000.00
Year 3
1,155,000.00
1,525,000.00
819,000.00 (99.87%)
1,155,000 (100%)
1,525,000.00 (100%)
806,816.78
1,135,757.18
1,135,757.18
807,867.01
1,135,757.18
1,135,757.18
1,000.00
Note: figures are shown from the balance sheet and income statement
38