Business Plan

Kae and Bae Apparel

Malugay St., Brgy. Ipil, Bongabong,

Oriental Mindoro
0948 157 4622

March 11,2025

Bea Bless Kristel M. Castillo

Princes Keanah R. Abacan

This document is confidential.

 Table of Contents

Table of Contents.................................................................................................................2
Executive Summary.............................................................................................................3
Vision/Mission Statement and Goals...................................................................................4
A. Vision Statement.........................................................................................................4
B. Goals and Objectives...................................................................................................4
C. Keys to Success...........................................................................................................4
Company Summary.............................................................................................................5
A. Company Background.................................................................................................5
B. Resources, Facilities and Equipment..........................................................................5
C. Marketing Methods.....................................................................................................5
D. Management and Organization...................................................................................5
E. Ownership Structure....................................................................................................5
G. Internal Analysis.........................................................................................................6
Products and/or Services......................................................................................................7
Market Assessment..............................................................................................................8
A. External Analysis........................................................................................................8
B. Customers....................................................................................................................8
C. Strategic Alternatives..................................................................................................8
Strategic Implementation.....................................................................................................9
Financial Plan.....................................................................................................................11
A. Financial Projections.................................................................................................11
B. Contingency Plan.......................................................................................................11
Monitoring..........................................................................Error! Bookmark not defined.

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 Executive Summary
A. Vision/Mission Statement
Kae and Bae Apparel envisions a world where fashion is truly inclusive,
empowering individuals of all body types and personal styles. Our mission is to
break barriers and redefine fashion by offering high-quality, stylish, and comfortable
clothing that promotes confidence and self-expression. We are committed to
sustainability, ethical craftsmanship, and creating a brand that values individuality.

B. Company Summary
Kae and Bae Apparel was founded by Bea Bless Kristel M. Castillo and
Princes Keanah R. Abacan, driven by their shared passion for fashion and
inclusivity. Our brand offers a diverse range of apparel that caters to various
demographics while maintaining a strong commitment to sustainability. We operate
from a dedicated studio equipped with state-of-the-art design software and sewing
machines, allowing us to create high-quality clothing. With an investment of ₱5
million to ₱15 million, we aim to establish ourselves as a trusted name in the
industry through innovation, strategic marketing, and customer engagement.

C. Products/Services
Kae and Bae Apparel specializes in stylish, high-quality, and inclusive fashion
for individuals seeking self-expression through clothing. Our product line includes:
 Casual wear, corporate attire, and streetwear.
 Customization services for unique and personalized designs.
 Bulk orders for businesses, schools, and organizations.
Our brand stands out due to its emphasis on quality, affordability, and sustainability.
Unlike mass-produced clothing, we ensure ethical production and the use of eco-
friendly fabrics. Limited-edition collections and customization options further
differentiate us from competitors.

D. Market Assessment
The Philippine apparel industry is highly competitive, with a growing demand
for inclusivity and sustainable fashion. Consumers are becoming more conscious of
ethical practices and prefer brands that align with these values. While competition
from fast fashion is a challenge, Kae and Bae Apparel capitalizes on the lack of
brands catering specifically to body positivity and personalized fashion. Our target
market includes young adults, professionals, and trend-conscious individuals who
value style, comfort, and sustainability.

E. Strategic Implementation
Kae and Bae Apparel will leverage a combination of modern manufacturing
techniques and local artisans to create high-quality products. Our competitive
advantage lies in our commitment to sustainability and inclusivity. Key strategies
include:
 Expanding our online presence and e-commerce platform.
 Partnering with influencers and retailers to enhance brand visibility.
 Implementing an efficient supply chain and inventory management system.
 Introducing pop-up stores and collaborations with established brands.

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 Our financial strategy involves securing partnerships with local suppliers and
investors while maintaining cost-efficient production. We will allocate 20% of our
budget to digital marketing and influencer collaborations to maximize exposure.

F. Expected Outcomes
Within the first year, Kae and Bae Apparel aims to achieve ₱20 million in sales
and establish a strong brand identity. By the second year, we plan to expand product
offerings, collaborate with retail stores, and increase customer retention. Long-term
goals include opening physical stores and positioning Kae and Bae Apparel as a
major fashion brand in the Philippines.
Through a well-executed strategy, commitment to sustainability, and focus on
customer satisfaction, Kae and Bae Apparel is poised for success in the fashion
industry.

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 Vision/Mission Statement and Goals

A. Vision Statement
At the heart of our vision is a place where fashion is truly for all. We are committed to
designing apparel that values individuality, ensuring that every customer, regardless of
their features and attributes, feels empowered, confident, and valued. We believe in
breaking barriers, challenging norms, and designing clothing that fits and satisfies every
body. More than just a brand, we are dedicated to sustainability, ethical craftsmanship,
and self-expression which ensure that fashion is a source of confidence and
empowerment for every fashionistas.

B. Goals and Objectives

Our clothing brand aims to establish itself as a well-known and trusted fashion brand
by offering a wide variety of designs and styles that satisfy different customer
preferences. We want to create a brand that not only delivers high-quality and stylish
clothing but also builds a loyal community of customers who trust our products.

We are committed to dedicating full-time efforts to product development, marketing,

and customer engagement. Our initial investment will be between ₱5 million to ₱15
million, which will be allocated across production, branding, logistics, and marketing.
We plan to invest 20% of our budget in digital marketing strategies, including social
media ads and influencer collaborations, to maximize brand exposure and sales growth.

Milestones and Timeline

 First 6 Months: Official brand launch, establishment of an online store, and

brand promotion through social media and influencer marketing.
 12 Months: Achieve at least ₱20 million in sales, develop a strong brand identity,
and introduce new seasonal collections.
 2 Years: Expand product offerings, collaborate with established retail stores or
marketplaces, and increase customer retention.
 3-5 Years: Open physical retail locations or pop-up stores and position the brand
as a major name in the fashion industry.

C. Keys to Success
For our clothing brand to succeed, we need a strong and recognizable brand identity,
high-quality products, and an effective marketing strategy that builds customer loyalty.
Investing in social media, influencer collaborations, and digital advertising will help us
reach and engage our target audience. Efficient supply chain management and smart
inventory control will ensure smooth operations while minimizing financial risks.
Excellent customer service and a focus on community engagement will turn buyers into
loyal supporters. Most importantly, adaptability to fashion trends, smart financial
planning, and a dedicated team will drive long-term growth and sustainability in a
competitive market.

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 Company Summary

A. Company Background
Kae and Bae Apparel is a fashion-forward business founded by Bea Bless
Kristel M. Castillo and Princes Keanah R. Abacan, driven by a shared passion for
style and individuality. The journey began as a partnership rooted in their love for
fashion, leading to the establishment of a brand that celebrates unique tastes
through carefully curated clothing collections. Key milestones in the development of
Kae and Bae Apparel include the launch of their first collection, a successful pop-up
shop event that garnered local attention, and the expansion into online retail,
allowing them to reach a broader audience and establish a loyal customer base.

B. Resources, Facilities and Equipment

Kae and Bae Apparel utilizes a combination of human, financial, and material
resources to produce its stylish clothing collections. The business operates from a
small studio space equipped with sewing machines, design software, and inventory
management systems, which are essential for creating and managing their apparel
line. Additionally, they employ a talented team of designers and marketers who bring
the vision of Kae and Bae to life, ensuring that each piece reflects the brand's
commitment to individuality and taste.
The necessary resources for Kae and Bae Apparel are provided by a mix of
local suppliers and financial backers. Fabric and material suppliers offer high-quality
textiles, while local artisans contribute to the production process. Financial resources
are secured through personal investments from the founders and potential small
business loans, enabling the business to grow and thrive in a competitive market.
Resource providers are rewarded through a variety of incentives, including
loyalty programs that offer discounts on bulk orders, exclusive access to new
collections, and appreciation gifts like bundles of apparel for significant contributions.
This approach fosters strong relationships with suppliers and encourages continued
collaboration, ultimately enhancing the brand’s value and reach.

C. Marketing Methods
Our annual sales volume is approximately 25 to 20 million pesos, with more
than 10,000 units sold each year. To improve returns, we actively collaborate with
suppliers and customers through strategic alliances, allowing us to negotiate better
pricing and enhance product offerings. We utilize forward contracting to secure raw
materials at fixed prices, minimizing the impact of market fluctuations. The cost to
produce and deliver our products is about 10 million pesos annually, and we
leverage contracting to ensure timely deliveries and maintain quality standards.

D. Management and Organization

The management team of Kae and Bae Apparel consists of four key
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executives who oversee different aspects of the business. Bea Bless Kristel M.
Castillo and Princes Keanah R. Abacan serve as Co-Chief Executive Officers (Co-
CEOs), responsible for setting the company’s strategic vision, making high-level
decisions, and managing stakeholder relations. They ensure the company remains
competitive and aligned with market demands.

Queensly Kessiah R. Abacan holds the position of Chief Financial Officer

(CFO). She is responsible for overseeing the financial health of the business,
including budgeting, financial planning, cash flow management, and ensuring
compliance with financial regulations. Additionally, she determines employee
salaries and handles payroll matters.

Denise Casabuena serves as the Chief Operations Officer (COO). She

manages the company’s day-to-day operations, ensuring efficiency across all
departments, from production to logistics. She also conducts employee performance
reviews and ensures that all operational processes align with the company’s long-
term goals.

The authority structure within Kae and Bae Apparel follows a clear hierarchy to
ensure effective management and workflow. At the top of the structure are the Co-
CEOs, who lead the company and represent it externally. Reporting directly to them
are the CFO and COO, who oversee financial and operational matters, respectively.

Below the CFO and COO are the department heads, who manage various
aspects of the business, including marketing, sales, production, and customer
relations. These department heads are responsible for implementing company
strategies and ensuring that employees meet business objectives. Employees and
staff report to their respective department heads, following the leadership set by the
management team.

E. Ownership Structure
The primary stakeholders in our business include the co-CEOs, our families
and relatives, employees, and investors. We operate as a partnership, allowing for
shared responsibilities and profits among partners. To operate legally, we require
special permits, including a business permit application form, a curriculum vitae for
each partner, and a communication letter outlining our business activities.
Compliance with inspection records is also essential for maintaining operational
standards.

F. Social Responsibility
 Environmental Practices - Kae and Bae Apparel is committed to sustainable
practices throughout our operations. We source fabrics from environmentally
conscious suppliers who prioritize organic cotton, recycled materials, and low-
impact dyes. We minimize waste by using efficient cutting techniques and
donating leftover fabric to local art programs. We also encourage our

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 employees to recycle and compost, and we partner with organizations that
promote sustainable textile production.

 Noise, Dust, Timing, and Odor Policies -We prioritize a clean and comfortable
work environment for our employees. We use dust-collecting equipment and
maintain regular cleaning schedules. Our sewing machines are equipped with
noise-reducing features, and we schedule potentially noisy tasks during off-
peak hours. We also monitor air quality and odor levels to ensure a healthy
work environment.
 Community Involvement - Kae and Bae Apparel believes in giving back to the
community. We encourage our employees to volunteer their time and skills to
local organizations. We also participate in community events and sponsor
local initiatives that promote arts, education, and social justice. We are
actively involved in industry-specific organizations at the local, state, and
national levels, advocating for ethical and sustainable practices in the apparel
industry.
 Hazardous Materials and Equipment Training - All new employees receive
comprehensive training on safe handling of materials and equipment. This
includes instruction on proper use of sewing machines, cutting tools, and
other equipment, as well as procedures for handling hazardous materials,
emergency response protocols, and workplace safety guidelines. We also
offer ongoing training programs to keep employees up-to-date on best
practices and industry regulations.

G. Internal Analysis
 Strengths and Weaknesses - Kae and Bae Apparel boasts a strong brand
identity and a loyal customer base. We have a talented team of designers and
craftspeople who are passionate about creating high-quality, stylish clothing.
However, we face challenges in terms of limited resources and a need to
expand our online presence to reach a wider audience.
 Relative Strengths – Our unit is known for its innovative designs and
exceptional craftsmanship. Our unit excels in customer service and
personalized attention.
 Core Competencies - Our core competencies include. These strengths allow
us to differentiate ourselves from competitors and provide value to our
customers.
 Exit Strategy - We are currently evaluating the performance of our. While it
has potential, it requires significant investment and restructuring. We are
considering options for its future, including a potential exit strategy.
 Promising Units - Our unit shows great promise with its growing customer
base and positive feedback. We plan to invest in its expansion and
development to capitalize on its potential.

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 Products and/or Services
Product Line and Offerings
Kae and Bae Apparel specializes in designing, producing, and selling high-
quality, stylish, and comfortable clothing for various demographics. Our product line
includes casual wear, corporate attire, and trendy streetwear, catering to individuals
who value both fashion and functionality. We offer customized apparel, allowing
customers to personalize their clothing with unique designs, prints, and embroidery.
Additionally, we provide bulk order services for businesses, schools, and
organizations that require uniforms or customized merchandise.

Uniqueness and Differentiation

Our brand stands out due to its combination of quality, affordability, and
modern designs. Unlike mass-produced clothing, Kae and Bae Apparel ensures that
each piece is made with attention to detail, using premium yet affordable materials.
Our commitment to sustainability also sets us apart, as we incorporate eco-friendly
fabrics and ethical production methods. One of our unique selling points is our
customization service, which allows customers to create one-of-a-kind pieces that
reflect their personal style. Additionally, our limited-edition collections ensure
exclusivity, making our products more desirable compared to mass-market brands.

Comparison with Competitors

 Quality - Our apparel is made from high-quality fabrics, ensuring durability

and comfort. We maintain strict quality control measures to ensure that each
product meets our standards.
 Price - We offer competitive pricing that balances affordability with premium
quality, making our products accessible without compromising excellence.
 Location - Our physical store is located in a strategic commercial area,
making it convenient for walk-in customers. We also have a strong lonline
presence, allowing customers to purchase from anywhere with ease.

Industry Experience
Our management team and staff have extensive experience in the fashion and
retail industry, including backgrounds in business, textile production, marketing, and
customer service. We have successfully built relationships with reliable suppliers,
ensuring that we source the best materials at cost-effective prices. Additionally, our
experience in digital marketing and e-commerce has helped us establish a strong
brand presence online.
Through years of market research, collaboration with fashion designers, and
hands-on experience in production, we have developed a deep understanding of
consumer preferences, current trends, and efficient business operations. This
expertise positions Kae and Bae Apparel as a trusted and competitive brand in the
apparel industry.

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 Market Assessment

A. Examining the General Market

The apparel market in the our community and in the country is indeed diverse,
with clear segments such as budget-conscious consumers, mid-range buyers, and
premium shoppers. Each segment is driven by unique factors like income levels,
lifestyle preferences, and fashion consciousness.

The market, however, lacks a strong focus on inclusivity and clothing that
accommodates all body types and personal expressions. This gap presents a growth
opportunity for Kae and Bae Apparel, which offers fashion-forward, body-positive
designs for every individual. Market growth potential is significant across all
segments, especially as the demand for sustainability, inclusivity, and ethical fashion
rises. Opportunities for growth lie in tapping into the rising awareness of body
positivity and eco-friendly fashion.

On the other hand, competition is fierce, with established brands dominating

the market. Using Michael Porter's Five Forces model, the threat of new entrants
remains moderate, while the bargaining power of customers is high, given the
availability of alternatives. Key trends include a growing demand for sustainable,
ethical fashion, and changing attitudes toward body image.

Drivers of change include social movements advocating for inclusivity and

environmental sustainability. Politically, we must navigate compliance with
regulations related to labor rights, environmental standards, and import/export laws.

B. Customer Analysis
Our primary customers are fashion-forward individuals who value self-
expression, sustainability, and inclusivity. This includes consumers across various
demographics, such as young adults, professionals, and individuals seeking trendy,
comfortable, and eco-conscious clothing. We sell a wide range of apparel designed
to cater to different body types, ensuring inclusivity and comfort. Our product solves
the key customer problem of finding stylish, well-fitting clothes that respect diverse
body shapes and align with sustainable values. Retaining customers is relatively
easier given the strong emotional connection that comes from providing
personalized and body-positive apparel, although competition remains a challenge.
The cost of supporting customers is moderate, as it involves maintaining high-quality
materials, ethical production processes, and responsive customer service.

C. Industry Analysis
The apparel industry in the Philippines is dynamic, with a growing inclination
toward online shopping and sustainable fashion. Consumer behavior is increasingly
shifting toward ethical brands that prioritize environmental sustainability and social
responsibility. Key challenges in the industry include fluctuating raw material costs,
competition from fast fashion, and the need to continuously innovate to meet
evolving customer expectations. Despite these challenges, there is a rising demand

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for more personalized and inclusive fashion options, which gives Kae and Bae
Apparel a competitive edge. Additionally, the growing e-commerce trend and shifting
fashion preferences create opportunities for direct-to-consumer sales.

D. Strategic Alternatives
To achieve long-term success, Kae and Bae Apparel should focus on
expanding its online presence, capitalizing on the growing e-commerce market, and
leveraging digital marketing strategies to connect with customers who align with its
values of inclusivity and sustainability. Expanding product lines to include more
options for various body types, along with introducing limited edition and custom-
made items, can further engage customers and foster brand loyalty. Additionally,
exploring partnerships with influencers and like-minded brands will help strengthen
the brand’s position in the competitive landscape. Another strategic option could be
opening pop-up stores or physical spaces that emphasize the brand's inclusivity and
sustainable ethos. This would allow the brand to build a tangible connection with its
community while enhancing visibility.

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 Strategic Implementation

A. Production
Kae and Bae Apparel will produce its products using a combination of local
artisans and modern manufacturing techniques, focusing on sustainable materials
and ethical craftsmanship. Our value proposition lies in creating apparel that fits
every body type, empowering individuals through inclusive designs. We will capture
value by ensuring that every customer feels confident, valued, and self-expressive.
Our competitive advantage is rooted in our commitment to sustainability, diversity,
and our unique designs that cater to all body shapes and sizes. We will use
advanced technologies like automated fabric cutting and 3D design software to
ensure precision and reduce waste. Our production process will involve sourcing
organic fabrics, using local sewing artisans, and implementing a just-in-time
manufacturing system to minimize overproduction. For business growth, we will
focus on enterprise expansion by partnering with retailers, replicating our operations
in key urban areas, and integrating eco-friendly practices across the supply chain.
The anticipated timeline for full operational launch and expansion is 18 to 24
months.

B. Resource Needs
To effectively organize the business, we need to ensure that human, financial,
and physical resources are in place. On the human side, key skills required will
include fashion design, pattern making, marketing, logistics, and customer service.
We plan to hire locally, providing training to artisans in sustainable practices while
hiring experts in business management and marketing. Financially, the business will
require a significant investment for initial production, marketing, and operational
setup, with an estimated capital of 5 million pesos for the first year. Physical
resources will include sustainable fabric inventory, sewing machines, and office
space, requiring a balance of quantity and high-quality standards to ensure both
production capacity and design integrity.

C. Sourcing/Procurement Strategy
Our decision to buy products or services will be based on a combination of
price, quality, and sustainability. We will prioritize local dealers and manufacturers
who share our commitment to ethical and environmentally friendly practices. By
sourcing locally, we can minimize shipping costs and reduce our carbon footprint
while ensuring that our supply chain is transparent. We will also explore direct
relationships with manufacturers to ensure high-quality, sustainable fabrics and
materials. Convenience and extra services such as timely delivery and flexibility will
also be important factors in building long-term relationships with our suppliers.

D. Marketing Strategy
Kae and Bae Apparel's sales plan will focus on a direct-to-consumer model
through an e-commerce platform, supported by pop-up shops in high-traffic urban
areas. To increase awareness and drive sales, we will use social media marketing,
influencer partnerships, and sustainable fashion campaigns. We will also collaborate
12
with local fashion retailers to expand our reach. The products will be priced
competitively, balancing quality with affordability to cater to a wide audience. We will
use hedging techniques such as forward pricing to lock in costs for raw materials
and minimize risks associated with market fluctuations. Marketing contracts will also
help secure long-term partnerships with influencers and retailers. To protect the
business, we will invest in liability insurance and, if necessary, product insurance for
our apparel line.

E. Performance Standards
To monitor the success of our business, we will establish clear performance
standards based on sales growth, customer satisfaction, and operational efficiency.
Acceptable performance standards will include achieving a 10% increase in sales
quarterly and maintaining a high customer satisfaction score (above 90%). Efficiency
levels will be measured by reducing production costs per unit and optimizing the
supply chain to minimize waste. Performance will be monitored through monthly
reviews, customer feedback, and industry benchmarks such as sustainability
standards and fashion sales metrics. The management team will be responsible for
overseeing performance, with clear roles for monitoring product quality, customer
engagement, and financial performance.

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 Financial Plan
Financial Projections
A. Declaration of Captured Total Market Size
Kae and Bae Apparel is a newly established clothing business in Brgy. Ipil,
specializing in trendy and affordable casual wear. The owner wants to determine
the market size before fully launching operations. Based on the community survey,
there are 3,500 households in Brgy. Ipil, and each household purchases an average
of 4 clothing items per month. The average price per clothing item is ₱350.
Market Size = Total Households×Purchase Frequency×Average Price
= 3,500 x (4 x 12) x 350 = ₱58,000,000

To assess competition, the owner conducted a Competitor Profile Matrix and

identified four direct competitors in Brgy. Ipil, capturing the following market shares;
Style Haven - 21%, Trendy Hub - 19%, Urban Vogue – 23%, and Fashion Hive -
17%.

B. Competitors Market Share

 Style Heaven (58,000,000) (21%) = 12,180,000
 Trendy Hub (58,000,000) (19%) = 11,020,000
 Urban Vogue (58,000,000) (20%) = 11,600,000
 Fashion Hive (58,000,000) (17%) = 9,860,000

C. Owner’s Market Share

Kae and Bae Apparel Market Share = 100% - 23% = 20%

Owner’s Market Share = Market Size x Market Share
= 58,000,000 x 23%
= 13,340,000
D. Annual Gross Revenue Projection (5 years)
YEAR 2026 2027 2028 2029 2030
23% 10% 20% 25% 30%
ANNUAL 13,340,000 14,674,000 17,608,800 22,011,000 28,614,300
GROSS
INCOME
In the year 2026, Kae and Bae Apparel started their clothing business. In the
succeeding year they plan to have 10% increase of revenue. In Year 2028
they desires for a great increase of 20%. In year 2029, they aims to increase
the revenue to 25% and in 2020, 30% respectively.
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 KAE AND BAE APPAREL
Projected Income Statement
January 2026-December 2026

Gross Income ₱14,340,000

Less: Costs of Goods Sold
Materials ₱2,500,000
Consumables ₱1,500,000
Implements used in Production ₱1,830,000
TOTAL COST ₱5,330,000

Less: Operating Expenses

Labor ₱1,500,000
Utilities ₱600,000
Sales Promotion ₱700,000
Delivery and Transportation ₱800,000
Miscellaneous ₱500, 000
TOTAL EXPENSES ₱4,100,000

Net Income Before Taxes ₱3,910,000

Less: Income Taxes ₱782,000
NET INCOME AFTER TAXES ₱3,128,000
Assumptions
 Sales Growth: The business is expected to achieve a 23% increase in
revenue, reaching ₱13,340,000 in gross income.
 Cost of Goods Sold (COGS): COGS remains 40% of gross income, covering
materials, consumables, and production costs.
 Operating Expenses: Estimated at 30% of gross income, including labor,
utilities, insurance, and marketing.
 Market Stability: Demand for the products remains strong, with no significant
external economic disruptions.

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 KAE AND BAE APPAREL
Projected Income Statement
January 2027-December 2027

Gross Income ₱14,674,000

Less: Costs of Goods Sold
Materials ₱3,400 ,000
Consumables ₱2,000,000
Implements used in Production ₱2,640,000
TOTAL COST ₱8,040,000

Less: Operating Expenses

Labor ₱2,000 ,000

Utilities ₱800,000
Sales Promotion ₱900,000
Delivery and Transportation ₱1,000,000
Miscellaneous ₱700, 000
TOTAL EXPENSES ₱5,400,000

Net Income Before Taxes ₱4,168 ,000

Less: Income Taxes ₱833,760
NET INCOME AFTER TAXES ₱3,335,040
Assumptions
 Market Expansion: The business successfully expands to new customer
segments, leading to a 10% increase in gross income.
 Cost Control: Material and production costs remain stable, keeping COGS
at 40% of gross income.
 Brand Growth: Increased brand awareness allows for higher engagement,
reducing the need for excessive promotional expenses.
 Economic Stability: No major economic disruptions affect consumer spending
power, ensuring steady demand.

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 KAE AND BAE APPAREL
Projected Income Statement
January 2029-December 2029

Gross Income ₱22,011,000

Less: Costs of Goods Sold
Materials ₱4,400,000
Consumables ₱2,500,000
Implements used in Production ₱3,404,000
TOTAL COST ₱10,304,000

Less: Operating Expenses

Labor ₱2,500,000
Utilities ₱1,000,000

Sales Promotion ₱1,000,000

Delivery and Transportation ₱1,200,000
Miscellaneous ₱900, 000
TOTAL EXPENSES ₱6,700,000

Net Income Before Taxes ₱5,007,000

Less: Income Taxes ₱782,000
NET INCOME AFTER TAXES ₱4,005,600
Assumptions
 Competitive Pricing Strategy: Adjusting prices slightly to stay competitive
results in a 25% increase in sales.
 Enhanced Logistics: Improved delivery and transportation management
reduces shipping delays and enhances customer satisfaction.
 Workforce Expansion: More employees are hired to manage increased
production, keeping labor costs aligned with growth.
 Loyalty Program Implementation: Repeat customer purchases increase due
to the launch of a rewards program.
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 KAE AND BAE APPAREL
Projected Income Statement
January 2030-December 2030

Gross Income ₱28,614,300

Less: Costs of Goods Sold
Materials ₱5,800,000
Consumables ₱3,000,000
Implements used in Production ₱4,645,000
TOTAL COST ₱13,445,000

Less: Operating Expenses

Labor ₱3,000,000
Utilities ₱1,200,000

Sales Promotion ₱1,400,000

Delivery and Transportation ₱1,500,000
Miscellaneous ₱1,200,000
TOTAL EXPENSES ₱8,300,000

Net Income Before Taxes ₱6,869,300

Less: Income Taxes ₱1,373,860
NET INCOME AFTER TAXES ₱5,495,440
Assumptions
 Major Market Breakthrough: The business experiences a 30% revenue
growth due to increased brand recognition and new retail partnerships.
 Premium Product Offerings: High-end product lines are introduced, leading to
higher profit margins.
 Operational Streamlining: Automation and technology adoption reduce
production inefficiencies and waste.
 Sustainable Practices: Eco-friendly initiatives enhance the company’s
reputation, attracting more environmentally conscious consumers.

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 KAE AND BAE APPAREL
Projected Income Statement
January 2028-December 2028

Gross Income ₱17,608,800

Less: Costs of Goods Sold

Materials ₱3,400,000
Consumables ₱2,000,000
Implements used in Production ₱2,640,000
TOTAL COST ₱8,040,000

Less: Operating Expenses

Labor ₱2,000,000
Utilities ₱800,000
Sales Promotion ₱900,000
Delivery and Transportation ₱1,000,000
Miscellaneous ₱700, 000
TOTAL EXPENSES ₱5,400,000

Net Income Before Taxes ₱4,168,800

Less: Income Taxes ₱833,760
NET INCOME AFTER TAXES ₱3,335,040
Assumptions

 Product Line Expansion: The company introduces new clothing styles,

contributing to a 20% revenue increase.
 Efficiency in Production: Bulk purchasing of raw materials reduces per-unit
costs, maintaining profitability.
 Increased Marketing Efforts: Higher spending on promotions drives more
sales but remains within the allocated 30% expense cap.

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  E-commerce Growth: A stronger online presence boosts nationwide orders,
compensating for any local sales slowdowns.

KAE AND BAE APPAREL

Projected Balance Sheet
December 2026

Current Assets
Cash 8,500,000
Accounts Receivable 7,230,000

Inventory 2,500,000
TOTAL CURRENT ASSETS 18,230,000
Fixed Assets
Building 3,500,000
Equipment 2,000,000
GROSS FIXED ASSETS 5,500,000
Less Accumulated Depreciation 2,350,000

NET FIXED ASSETS 3,150,000

TOTAL ASSETS 20,380,000

LIABILITIES AND OWNERS EQUITY

Liabilities
CURRENT LIABILIITIES
Accounts Payable 3,100,000
Accrued Payables 2,200,000
TOTAL CURRENT LIABILITIES
Long Term Liabilities
Mortgage Payable 1,500,000

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TOTAL LIABILITIES 6,800,000
OWNER'S EQUITY
Ms. Castillo’s Capital 4,400,000
Abacan’s Capital 4,400,000
TOTAL LIABILITIES AND OWNER'S EQUITY 15,600,000

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 CONTINGENCY PLAN
1. Alternative Strategies for Ineffective Promotions
If our initial marketing efforts, such as social media ads and influencer
partnerships, fail to generate sufficient customer engagement, KAE AND BAE
APPAREL will shift its focus to alternative promotional strategies. This
includes collaborating with local fashion events, offering exclusive discounts
for first-time buyers, and implementing a referral program to encourage word-
of-mouth marketing. If no significant improvement is seen within three
months, we will invest in professional marketing consultants to refine our
branding and outreach strategy.

2. Addressing Declining Sales

If sales show a downward trend, KAE AND BAE APPAREL will conduct an in-
depth market analysis to identify potential reasons, such as pricing issues,
quality concerns, or changing fashion trends. To address this, we will launch
customer feedback surveys, introduce limited-edition collections to reignite
interest, and offer loyalty rewards to encourage repeat purchases. If
necessary, we will adjust pricing strategies or expand to new sales channels,
such as online marketplaces, to reach a broader audience.

3. Differentiation in a Competitive Market

In a highly competitive market, KAE AND BAE APPAREL will differentiate
itself by focusing on unique product designs, superior fabric quality, and eco-
friendly production methods. We will also build strong customer relationships
through personalized service, exclusive membership perks, and interactive
social media engagement. Additionally, we will explore niche markets, such
as custom apparel or limited-edition collaborations, to establish a unique
brand identity that sets us apart from competitors.
4. Relocation and Expansion if the Business Location is Unsuitable
If we observe that foot traffic and local demand are declining after the initial
hype, KAE AND BAE APPAREL will analyze customer demographics and
buying behavior. If necessary, we will consider opening a pop-up store in a
different location while maintaining a strong online presence. Expanding into
e-commerce and partnering with nationwide delivery services will help us
reach a broader audience, reducing dependency on a single physical
location.

5. Sustaining Earnings During Off-Peak Seasons

To sustain revenue during off-peak seasons, KAE AND BAE APPAREL will
introduce diverse product lines suitable for different weather conditions and
occasions. For example, we will offer exclusive collections for summer and
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holiday seasons while launching pre-orders and early-bird promotions to
maintain sales flow. Additionally, we will create limited-time offers and bundle
discounts to encourage purchases during slow months.

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