For the Board of Directors:
This office is forwarding to you a brief of the investments we are about to make. This paper summarizes and consolidates the key points of the above mentioned proposed investment for your notation and approval
Executive Summary
This paper/document summarizes the concept, the computations, the MVP and the business model of the proposed businesses that this office has been working very hard on since the start of H2
The Chapel Memorial Services (funeral services) shall utilize the existing chapels we have built and fully furnished at Pangasinan, Calamba, La Union, and Morong which are built for memorial services as they come with: Chapel Display Room, Embalming room and all stuff needed to complete the memorialization experience:
Place for burial - ash crypts, bc, and memorial plots
Services: Funeral service
Interment service
Plans: vehicle to buy this at pre need:
plots, crypts, (body and ash) CHEAPER, PAYABLE IN INSTALLMENTS MONTHLY
We will have 3 companies that puts together all of these:
HOLY GARDENS MEMORIAL PARK
HOLY GARDENS MEMORIAL CHAPELS AND CREMATORIUM
HOLY GARDENS MEMORIAL PLANS
A. Opportunities:
1. Increase of sales: the three businesses can increase /triple our sales from mere P100 million to over P300 million
2. Utilization of our existing chapel infrastructures which are unproductive
3. Legally selling IS to and funeral services as pre need. A financial plan company is available for a premium of P5 million and P6 million to cover the capital impairment.. There are 22 remaining MP companies; one of them is Destiny. This was offered before to Forest Lake in January. They are now running after this company because OIC sat on their application to set up one.
1. Increasing sales:
From Memorial Park - P108,000,000
From Chapel Memorial Services:
Calamba - P25,000,000
Pangasinan 15,000,000
La Union 5,000,000
HAMP ? 40,000,000
Memorial Plan company
Sale of IS Pre need to
Existing customers 83,400,000
CMS 68,250,000
151,650,000
Total 299,650,000
2. Opportunities (External Analysis)
Population and death rate:
Holy Gardens Pangasinan:
SCC pop - 175,103
Catchment area
within 25 km radius
Calasiao 91, 106
Dagupan City 163,676
Malasiqui 123,566
Total 378,348
Death rate - 1891
Our uptake 201
% 5.7%
Opportunity 94% of the catchment area
# of Dead in SCC 1,901
Potential market for CMS (hi estimate) 1,901 x 50t = P95,075,000
Low estimate 1,901 x 305 = 57,030,000
Our projection of P15 million is only 15% of the high estimate and 26% of the estimate
MPlan potential market: 726,000 / persons per household = 145,200
Low estimate 145,200 x 30t P4,356 million
145,200 x 50t 7,260 million
Total population of entire SCC and catchment area
Our uptake: 201
% of effectiveness 10.52
Holy Gardens Calamba
Population - 389, 377 (2010)
# of deaths 1,945 estimate
Take note that Calamba is a crossroad
Catchment area:
All as of 2010
Cabuyao 248, 436
Los Banos 101,884
Sto Tomas Batangas 124,740
Catchment Area Total 475,060
# deaths estimate 2375
Potential market for CMS and MPlan
For CMS
High estimate
CMS x 50t x (2,375 + 1,945) = 4320 x P50t packages P216 million
CMS x 30t (x 4320) 124 million
The 25 million projected for Calamba is only 10% of the high estimate and 20% of the low estimate (which should be easy because of our competitive pricing and better service
For Memorial Plan
Total population for CC and catchment area. - 864, 437
864,437 / 5 172,887 households
Low estimate 172,887 x 30t = P5,186 million
High estimate 172,887 x 50t = P 8,644 million
Holy Gardens La Union
Population and death rate
San Fernando City pop 114,463
Death rate: 572
Our uptake 134
% 23%
Unutilized potential 77%
Catchment area:
San Juan - 35,098
Bauang - 70,735
Total 105,833
Estimated # deaths: 529
Potential market for CMS
Total death rate at SFDO and catchment - 1101
Low estimate: 1101 x 30t 33,030,000
High estimate 1101 x 50t 55,050,000
The 5 million estimate target for LUMP is only 15% of the potential market
and 9.09% of the high estimate
Potential market for memorial plan
Total population of SFDO and catchment area 220, 296
Estimated Number of household: 220,296/5 44,959
Potential market for memorial plan
Low estimate: 44,959 x 30t 1,321 million
HIgh estimate 44,959 x 50t 2,247 million
THE TARGETS THEREFORE FOR THE TARGETTED AREAS ARE REALISTIC AND ACHIEVABLE
3. Investment requirement and ROI
For chapel memorial services:
List of FFE required:
Karuwahe - P160,000 (reduced)
L300 200,000
Expedition 280,000
F 150 flower car 200,000
Lights and chandelier 70,000 max
(we can have a 38t set low end)
Mass card holder 6,000
Atrille (folding casket carrier) 8,000
Casket dolly in display room 7,000
Casket rack 5 x 8t 40,000
Embalming table SS 20,000
Casket inventory 100,000
1,091,000 x P3,273,000
which can be borrowed from IF
Notes: Expedition and F150 can be bought at 50% downpayment and balance with PDC for 6 months. This can be paid in cash less 3%
Karuwahe is 30% dp upon signing and will finish 1 in 30 days, we pay the balance and he will finish the second one and so on. The Karuwahe can:
1. Used free or +5t for luxury
2. Can be rented out for low of 10t (it is rented out at 20t in Calamba)
Casket shall be paid in cash for initial delivery; and 60 to 90 days PDC thereafter; they will give us free infant casket for every delivery
All others are cash payment only
For MP company:
According to our latest discussion with ABartolome, the cash requirements are:
P5,000,000 for the premium for him and Bayani Tan
6,800,000 to fill up the capital impairment (this shall be part of our capital
11.800,000 shall include the premium of P5 million; AB3 suggests that we can flip this if we have great sales force.
Upon receipt of the OIC approval, the P5 million, for a period of not to exceed ninety days, shall be paid to AB3 and the new owners can take over and operate the DFP
There will be withdrawal of assets (mostly Heavens Gate Plots in the of P37 million by AB and Tan within a period of 90 days, and the same on a staggered basis replaced by assets of Holy (The other assets are trust fund assets of DFPI at Union Bank) We can use the trust fund at Union bank in the meantime; the cut off has been established.
THeir assets now are:
P37.8 Memorial Park Lots
2.+ trust funds and some P300t cash in bank
39.8 total
and the capital impairment
Total Investment required:
Memorial Plan Company P11.800,000
Chapel Memorial Service 3,300,000
Total P15,100,000
This can be funded by SBUs sales, IF, repayment by Asia Prime of 6 million
Recap of Revenues Sales Collection GP
Chapel Memorial Services 40,000,0000 P12,000,000
30% margin
ROI 12 million/ 3.3 million 363%
Memorial Plan
Sales estimate: P150,000,000
20% Cash receipt 30,000,000
20% margin 6,000,000
ROI 6/11 54%
If we can flip the P5,000,000, that will be 6/6= 100%
THE ESCROW DEPOSIT SHALL BE MADE THIS TUESDAY IN THE AMOUNT OF 1,000,000
I WILL REQUEST FOR THE APPROVAL OF THE CAP EX FOR THE SBUS AND THE PO FOR THE EQUIPMENT AND EVENTUAL EXECUTION BY JANUARY OF 2015.
For your information and notation
Jorge S
Noted by:
Elvira R Saguinsin Madelene R. Saguinsin
Please reply. CCD 2.27
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