I have canvassed most of the equipment needed. But before I purchased any of these, I had to do two things. 1) measure whether everything fits the space, and 2) check costing.
I had initially finished tallying the projected cost for the bakery. But I talked it over with my financier and the costing needed to be revised. The new costing had updated prices from the suppliers I found last week. And it also had projections on labor. Not everything is set in stone but I've found that the cost projections should always be updated because it's impossible to know all costs from the start. It's also important to overproject to make sure you don't get surprised midway through the business with a unexpected cost.
Our conservative projections showed that we need a little less than P1,000,000, to operate for 1 full year assuming that no sales are made. The next step is to check each item to see if they're necessary, not for right now, or can be removed. Then after, we can look into projections for sales and possibly assign sales goals.
Monday, July 20, 2015
Thursday, July 16, 2015
The Search for Baking Equipment
Up until today, I've only checked one equipment supplier. I was set to get all my equipment from them because their store was just a ride away. Until a few days ago when I learned that the deck oven I had my eyes on was not available and that ordering it would mean I need to wait for 1-2 months.
I checked online for bakery equipment suppliers and most were in Manila (Quiapo and Binondo). So today, I set out to check them out. I'm glad I did because the shops I visited were a lot cheaper and more complete than the supplier I originally wanted to use. I can't comment on the quality but it looks like they're the go to place for bakery owners.
Lesson for the day, canvas before committing yourself to buying something. Especially if it's a major item.
I checked online for bakery equipment suppliers and most were in Manila (Quiapo and Binondo). So today, I set out to check them out. I'm glad I did because the shops I visited were a lot cheaper and more complete than the supplier I originally wanted to use. I can't comment on the quality but it looks like they're the go to place for bakery owners.
Lesson for the day, canvas before committing yourself to buying something. Especially if it's a major item.
Tuesday, July 14, 2015
Expense Tracking
Since I started with this whole process, I've been tracking all of my expenses. I haven't stated it in my previous posts but I've listed every little item that was spent. This includes fare, permits, supplies, food.
As much as possible, everything must have a receipt. This would be tagged as an expense when the time comes when I have to file for income tax. Strictly speaking, you can't declare an expense if it doesn't have a receipt. I still don't know what to do with receiptless expense but I'll deal with that when the time comes.
As much as possible, everything must have a receipt. This would be tagged as an expense when the time comes when I have to file for income tax. Strictly speaking, you can't declare an expense if it doesn't have a receipt. I still don't know what to do with receiptless expense but I'll deal with that when the time comes.
What now?
Since I couldn't continue with the Mayor's Business Permit, I didn't know what to do today. I knew I had to be doing something. I realized that this was the other side of being in control of everything. When you're an employee, you will always have people guiding or forcing you to do what you need to do. When you run your own business, it's all up to you. It's very easy to "call in sick" because there's no one to answer to. But I needed to prove that I have what it takes to run a business. So I decided to visit my soon to be bakery.
On my way to the site, I came across a steel manufacturing company just a few buildings away from where I would be setting up shop. They made lockers, file cabinets and steel shelves which was precisely what I had in mind. I asked for a quote but it looks like I'll be getting my shelves from them. It's surprising for me to pass through their building this whole time and not even notice their huge building. Anyway, that's one less item I need to search a supplier for.
Next, I went to the space I was renting where I measured everything. I wanted to study the space so I can plan the layout before buying anything. I didn't want to be stuck with a table or a shelf that would make my space smaller than it really is.
Then I went to a kitchen equipment warehouse. I canvassed for an oven and countertops. After that, I bought some office supplies which was also for the store.
Today's activities were pretty minor as far as the big picture goes but it's better than sitting around and doing nothing.
On my way to the site, I came across a steel manufacturing company just a few buildings away from where I would be setting up shop. They made lockers, file cabinets and steel shelves which was precisely what I had in mind. I asked for a quote but it looks like I'll be getting my shelves from them. It's surprising for me to pass through their building this whole time and not even notice their huge building. Anyway, that's one less item I need to search a supplier for.
Next, I went to the space I was renting where I measured everything. I wanted to study the space so I can plan the layout before buying anything. I didn't want to be stuck with a table or a shelf that would make my space smaller than it really is.
Then I went to a kitchen equipment warehouse. I canvassed for an oven and countertops. After that, I bought some office supplies which was also for the store.
Today's activities were pretty minor as far as the big picture goes but it's better than sitting around and doing nothing.
Monday, July 13, 2015
Business Bank Account
It was still early in the day and I still had time to go to the bank. I intended to open an new bank account solely for the bakery.
I went to BPI because all my other bank accounts are with BPI. They told me that there was a Sole Proprietor Bank Account. It functioned the same way a normal savings account did but the difference was that the account name is my name as well as the business name which was Obiwan's Bakery.
These are the requirements:
1. Application Form
2. Business Name Registration from DTI
3. Barangay Business Clearance
4. Valid ID
5. Proof of Billing
6. ID pic
Minimum Initial Deposit: P3,000
Minimum Maintaining Balance (to earn interest): P5,000
Interest rate: 0.250%
The interest rate was really low but I intended to just have a separate bank account to ease tracking money for and from the bakery. Assuming that all rquirements are complete, the whole process takes around 30 mins.
I went to BPI because all my other bank accounts are with BPI. They told me that there was a Sole Proprietor Bank Account. It functioned the same way a normal savings account did but the difference was that the account name is my name as well as the business name which was Obiwan's Bakery.
These are the requirements:
1. Application Form
2. Business Name Registration from DTI
3. Barangay Business Clearance
4. Valid ID
5. Proof of Billing
6. ID pic
Minimum Initial Deposit: P3,000
Minimum Maintaining Balance (to earn interest): P5,000
Interest rate: 0.250%
The interest rate was really low but I intended to just have a separate bank account to ease tracking money for and from the bakery. Assuming that all rquirements are complete, the whole process takes around 30 mins.
Mayor's Business Permit - Requirements
Typhoons from last week stopped me from continuing filing the permits needed. But that's done and I was now able to go to Mandaluyong City Hall.
I intended to apply for a Mayor's Business Permit but part of the requirements was the lease contract and I didn't have that yet. Here's the complete list as per the officer of the day:
1. Barangay Clearance
2. Business Name Registration from DTI
3. Lease Contract
4. Pictures of establishment in 3R format showing left and right neighbors as well as inside of the establishment.
5. Community Tax Certificate or Cedula
I already had 1 and 2. 3 was on its way. 4 can be done another day.
While I was in city hall, I applied for a Cedula. It cost P63. And I was done within 10 mins. They asked me how much I earned monthly and as I didn't have fixed income, I made it up as P6,000. I think they computed the P63 from the declared P6,000 income but I can't be sure. They took me by surprise. My suggestion, underdeclare your income when filing for a Cedula. Then comment here if your fee is lower.
I intended to apply for a Mayor's Business Permit but part of the requirements was the lease contract and I didn't have that yet. Here's the complete list as per the officer of the day:
1. Barangay Clearance
2. Business Name Registration from DTI
3. Lease Contract
4. Pictures of establishment in 3R format showing left and right neighbors as well as inside of the establishment.
5. Community Tax Certificate or Cedula
I already had 1 and 2. 3 was on its way. 4 can be done another day.
While I was in city hall, I applied for a Cedula. It cost P63. And I was done within 10 mins. They asked me how much I earned monthly and as I didn't have fixed income, I made it up as P6,000. I think they computed the P63 from the declared P6,000 income but I can't be sure. They took me by surprise. My suggestion, underdeclare your income when filing for a Cedula. Then comment here if your fee is lower.
Wednesday, July 8, 2015
Barangay Business Clearance
Next step for me was to apply for a Barangay Business Clearance. My business is located in Barangay Plainview in Mandaluyong. The whole process took just around 5 minutes, probably due to the typhoon.
The brgy representative asked for a photocopy of my DTI Certificate of Business Name Registration. He also asked if there was a lease contract but it didn't seem to matter that I didn't have the contract with me as I was still able to get the Barangay Business Clearance. No other documents was asked from me.
Here's the breakdown of how much it cost me there:
Barangay Business Clearance - P500
Barangay Business Plate - P250
Notary - P60 (no official receipt)
Total - P810
———
I realized during this part of the process that it's adviseable to start a business where one lives. It's not a requisite but it's very convenient.
The brgy representative asked for a photocopy of my DTI Certificate of Business Name Registration. He also asked if there was a lease contract but it didn't seem to matter that I didn't have the contract with me as I was still able to get the Barangay Business Clearance. No other documents was asked from me.
Here's the breakdown of how much it cost me there:
Barangay Business Clearance - P500
Barangay Business Plate - P250
Notary - P60 (no official receipt)
Total - P810
———
I realized during this part of the process that it's adviseable to start a business where one lives. It's not a requisite but it's very convenient.
Lease Contract
I won't go into details on my arrangement with my lessor as each property manager is different and have different terms.
In my case, the lessor needed to finish repairs on the unit before I could sign the contract. But I was able to pay the advance and the deposit which secured me the unit. Up until today, there was always the threat of someone else taking the unit and all the time I spent waiting would've been for nought.
In my case, the lessor needed to finish repairs on the unit before I could sign the contract. But I was able to pay the advance and the deposit which secured me the unit. Up until today, there was always the threat of someone else taking the unit and all the time I spent waiting would've been for nought.
Tuesday, July 7, 2015
Business Name Registration
The property manager required me to provide the business name for the lease contract. I have not registered the business yet. I thought that I would need the lease contract before I could apply for a business name. But I was wrong.
So I registered my business name with DTI. We decided to create a sole proprietorship business for simplicity. It was very difficult to find an available name. It's suggested that a list is prepared beforehand. My business ended up being named Obiwan's Bakery. I wanted it to be Obiwan Bread Company but as per DTI, I needed to use bakery.
The whole process took around 30 minutes. There were 4 types of scope, Barangay, City, Regional, National and it costs P200, P500, P1000, P2000 respectively.
So I registered my business name with DTI. We decided to create a sole proprietorship business for simplicity. It was very difficult to find an available name. It's suggested that a list is prepared beforehand. My business ended up being named Obiwan's Bakery. I wanted it to be Obiwan Bread Company but as per DTI, I needed to use bakery.
The whole process took around 30 minutes. There were 4 types of scope, Barangay, City, Regional, National and it costs P200, P500, P1000, P2000 respectively.
Obtaining Necessary Skills
The other problem I was faced with was that I do not know how to bake. I have never used an oven. I don't even like eating bread. But I figured this little road block shouldn't stop me from starting a bakery. This is contrary to the saying that you should start a business based on your passion. Let me try to disprove it.
I figured I had to start small. If there was one thing I needed to learn how to make, it was to make a pandesal. I've seen bakeries that make only pandesal and they look like they're striving. It would be a great starting point.
So I searched for organizations that offered training and found Negoskwela. They conducted seminars on various topics including Native and Malunggay Pandesal Making. It was perfect. It costs P1980 and there was a discount if you paid 4 days before the seminar.
The seminar had it's flaws. I would've wanted more hands-on exercises and it would be ideal if there was an overview of what each ingredient was for. But I think it did the job. I'm not sure about this as I've yet to apply what I learned in the real world. For now, I'm still not sure whether the seminar was worth P1980.
I figured I had to start small. If there was one thing I needed to learn how to make, it was to make a pandesal. I've seen bakeries that make only pandesal and they look like they're striving. It would be a great starting point.
So I searched for organizations that offered training and found Negoskwela. They conducted seminars on various topics including Native and Malunggay Pandesal Making. It was perfect. It costs P1980 and there was a discount if you paid 4 days before the seminar.
The seminar had it's flaws. I would've wanted more hands-on exercises and it would be ideal if there was an overview of what each ingredient was for. But I think it did the job. I'm not sure about this as I've yet to apply what I learned in the real world. For now, I'm still not sure whether the seminar was worth P1980.
Finding Capital
Between the two problems I was faced with, finding capital for the business was more immediate. Everything depends on having money to start the business.
I could save money on my own since I have existing endeavors. But it would take time and it might mean that the space wouldn't be available anymore. As mentioned in the previous post, it has been a habit to inquire about spaces for rent and I know how rare a space that fits my needs comes along.
I didn't want to borrow from the bank. I have an existing loan and I didn't want to borrow again until the existing loan has been paid in full.
The other option was to find a financier/partner. And it just so happened that my mother was looking for a new business venture. She had always wanted to have a business but office work prevented her from having one. I proposed to her that we start a bakery and she liked the idea. I gave her a rough estimate of how much it would cost to set up based on some assumptions on rent, utilities, equipment, ingredients, etc. and she was ok with the amount.
One problem down, on to the next...
I could save money on my own since I have existing endeavors. But it would take time and it might mean that the space wouldn't be available anymore. As mentioned in the previous post, it has been a habit to inquire about spaces for rent and I know how rare a space that fits my needs comes along.
I didn't want to borrow from the bank. I have an existing loan and I didn't want to borrow again until the existing loan has been paid in full.
The other option was to find a financier/partner. And it just so happened that my mother was looking for a new business venture. She had always wanted to have a business but office work prevented her from having one. I proposed to her that we start a bakery and she liked the idea. I gave her a rough estimate of how much it would cost to set up based on some assumptions on rent, utilities, equipment, ingredients, etc. and she was ok with the amount.
One problem down, on to the next...
How to Start a New Business - Take 2
The business we started from the previous post is still running. I just wasn't able to continue documenting how we started the business.
Now, I'm starting a new business. This time, I'll try to document all the steps for the benefit of other newbies who want to be an entrepreneur. Note that I am by no means an expert at starting a business so follow my instructions and recommendations with a grain of salt.
Since we started our first business, I've been on a constant lookout for new business opportunities. When I roam around, I'd take note of commercial spaces for rent and I would think what business would fit that space. Then I'd check if it's something I want to pursue. I would contact lessors and inquire about rates so that I would be more informed on commercial space rates.
Sometime last April of this year, I saw a commercial space for rent along Boni Ave in Mandaluyong. And as my practice, I inquired to get the details. From the start I knew I was not going to rent the space because it was way above budget but had I not inquired, I would not have known of another space that would be available. The property manager informed me that their other unit would be available soon. The other unit is in a residential part of Mandaluyong and the price was more reasonable. It's perfect for a bakery.
I was now faced with 2 new problems; 1) I have no capital, and 2) I don't know how to bake bread.
Now, I'm starting a new business. This time, I'll try to document all the steps for the benefit of other newbies who want to be an entrepreneur. Note that I am by no means an expert at starting a business so follow my instructions and recommendations with a grain of salt.
Since we started our first business, I've been on a constant lookout for new business opportunities. When I roam around, I'd take note of commercial spaces for rent and I would think what business would fit that space. Then I'd check if it's something I want to pursue. I would contact lessors and inquire about rates so that I would be more informed on commercial space rates.
Sometime last April of this year, I saw a commercial space for rent along Boni Ave in Mandaluyong. And as my practice, I inquired to get the details. From the start I knew I was not going to rent the space because it was way above budget but had I not inquired, I would not have known of another space that would be available. The property manager informed me that their other unit would be available soon. The other unit is in a residential part of Mandaluyong and the price was more reasonable. It's perfect for a bakery.
I was now faced with 2 new problems; 1) I have no capital, and 2) I don't know how to bake bread.
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