Chapter 2 Feasibility Study for Dance Studio

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Chapter 2 MARKETING ASPECT

Marketing is a vital part of a business triumph. It involves the production and distribution of products and services and is also concerned with the ethical and social responsibility functions found in the domestic and global environment. The market is essential to this study to know if the proposed project is feasible or not.

This aspect deals with the nature of the target market, the description of the service and the service fee, identification the competitor’s price, and the demand-supply analysis. This will also emphasize the marketing plan which is relevant to the operation of the business.

To be successful, business that deals with customers on a daily basis must not only be customer-driven, but customer-obsessed. The target market should be given first hand priority since income will generate from them. An apparent apprehension of demand and supply analysis, organized and precise interpretation of data and

identification of the target market are substantial elements in any feasibility study.

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Name of the Business

The proponents named their proposed business as “JAST Dance

Studio”. The acronym JAST comes from the nicknames of the researchers, Joseph, Alex, Sab and Trixia.

Figure 1. Business Logo

General Market Information

Market Description

The proposed project is the establishment of dance studio that will provide rental services and workshops to the respondents aging 10 years and above. JAST Dance Studio will offer high-quality services and convenience to our customers. The studio was designed to have a positive and creative atmosphere, well-ventilated facilities with the

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combination of excellent working sound system and fully-furnished sprung wood floor so that every dancer can master their craft. Other facilities include open lounge space, comfort rooms, and others. The proponents also exerted extra effort to keep in mind the value of comfort living so we can definitely assure our customers the best rehearsal experience.

The studio will be located at Barangay Uno Calamba City. The proponents choose the said place because it is populated. They believe that it will be a great place to start the business.

Demand Analysis

Demand is an economic principle that describes a consumer’s desire or willingness to pay a price for a specific goods or services. The proponents determine demand of its proposed service by conducting surveys to people who are willing to avail their proposed project. In this study, the demand is determined by the need for the service to be marketed to the target market and is used to come up with a fairly accurate assumption about the project.

Factors Affecting Demand 1. Service Price

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Price is the only element in the marketing mix that produces revenue. (Ac-Ac, 2009. Principles of Marketing). This factor has a great impact on the demand. They say that setting low prices increase the demand, in effect; the quality of the service will be affected. And if it does not meet the customer’s desire will effect to revulsion of the service, and greatly affect the demand.

2. Price of Related Services

The demand for dance studio is affected by people who visit fitness centers and people who enroll in talent workshops. Additionally, salaries of dance instructors are also necessary. 3. Customer’s Income

Demand for this service is affected by the income of the customer. People with higher income are more likely to avail the said services than those people with lower income especially those who do not have job like the students. Lower income earners tend to find cheaper alternative services.

4. Population

The rapid increase in population directly affects the demand of the said business. The more people there is in a particular place, the more the demand will definitely increase.

5. Customer’s Preference

The preference of the customers directly influence the demand. These include the changes in trends, habits and lifestyle.

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The population of the study used for the computation of the sample

size of the respondents who are dancing or an aspiring dancer aged 10 years and above was obtained from multiplying the total

population of Barangay Poblacion 2015 to the margin of error, 5%

n= 34457

1+34457 (.05)2

= 396 total respondents

The following tables were obtained by the proponents through figures gathered from the survey conducted and were interpreted based on actual results.

Table 1 indicates that most of the respondents of this study are aging 15 – 19 with 227 (57.32%) while aged 55 – 59 with 3 (0.76%) are the least respondents.

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Table 1. The number of respondents aged 10 years and above

From – To Frequency_(f) Percentage_(%)

10 – 14 15 – 19 20 – 24 25 – 29 30 – 34 35 – 39 40 – 44 45 – 49 50 – 54 55 – 59 18 227 100 13 11 10 5 5 4 3 4.55 57.32 25.25 3.28 2.78 2.53 1.26 1.26 1.01 0.76 Total 396 100%

Table 2 shows that majority of the respondents aged 10 years and above were females with a total of 247 (62.37%) and males with 149 (37.63%).

Table 2. The gender of the respondents

Response Frequency_(f) Percentage_(%)

Male Female 149 247 37.63 62.37 Total 396 100%

The table below indicates that 301 (76.01%) of the total

respondents were dancing or an aspiring dancer while 95 (23.99%) were not.

Table 3. The number of respondents who are dancing/aspiring dancer

Response Frequency_(f) Percentage_(%)

YES

NO 30195 76.0123.99

Total 396 100%

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Table 4 shows that most of the respondents belong in a group with 241 (80.07%), others do not belong to any group with 46 (15.28%) while 14 out of 301 (4.65%) prefer to dance with a partner.

Table 4. The group that the respondents belong to

Group Duo Solo 241 14 46 80.07 4.65 15.28 Total 301 100%

Table 5 implies the types/genres that the respondents usually dance. And on top of the list is Hip-Hop with 145(30.40%). Hip-Hop is popularly known in the Philippines since early 80’s and has been a major genre that is usually dance. Next is jazz or modern dance with 123(25.79%). The difference between Hip-Hop and Jazz/Modern dance is that Hip-Hop has a faster tempo; funky and new while Modern dance is the sharper version of lyrical dance. On the other side, the least chosen by the respondents is Vogue with 1(0.03%).

Table 5. Types/Genres usually dance by the respondents

Hip-Hop Jazz/Modern Dance Contemporary Ballroom Folkdance Zumba Cheer dance Interpretative Vogue 145 123 44 39 50 55 10 10 1 30.40 25.79 9.24 8.18 10.48 11.53 2.11 2.11 0.03 Total 477 100%

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The table 6 indicates that the respondents generally rehearse or practice their house with 107(30.31%) while minority is at the street with 33(9.35%).

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Table 6. The place where the respondents usually dance

House Street Open area Court School 107 33 93 85 35 30.31 9.35 26.35 24.08 9.91 Total 353 100%

Table 7 suggests that majority of the respondents are willing to avail the rental service offered by the proponents with 261(86.71%) and others prefer not to with 40(13.29).

Table 7. The number of respondents who are willing to avail rental service

YES NO 261 40 86.71 13.29 Total 301 100%

Table 8 shows that most of the respondents rehearse or practice occasionally with 83(27.57%) while others prefer every once a month with 14 (4.65%)

Table 8. The number of respondents on how often they usually dance

Everyday Once a week Twice a week Thrice a week Once a month Occasionally 41 60 68 35 14 83 13.62 19.93 22.59 11.63. 4.65 27.57 Total 301 100%

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Table 9 on the next page implies that majority of the respondents are willing to undergo dance workshop to develop their dancing skills with 277 (92.03%) while others prefer not to with 24 (7.97%).

Table 9. The number of respondents who are willing to undergo dance workshop to enhance their dancing skills

YES

NO 27724 92.037.97

Total 301 100%

Table 10 shows that 147(33.64%) of the respondents have personal interest in dancing as their purpose while 6(1.37%) as their past time. Table 10. The respondents’ purpose in dancing

School purposes Entertainment Exercise Personal interest Past time 94 86 104 147 6 21.51 19.68 23.80 33.64 1.37 Total 437 100% Present Demand

The proponents obtained the actual demand of dance studio in Barangay Poblacion, Calamba City by conducting a self-administered survey within the target area. The table below indicates the tabulated results gathered.

Table 11. Present demand for dance studio rentals

Response Frequency_(f) No. of operating_{days per year} **Annual_Demand

Everyday Once a week Twice a week Thrice a week 38 58 56 34 289 48 24 10,982 2,784 1,344

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Once a month *Occasionally 9 66 12 12 6 408 108 396 Total 261 391 16,022

*The proponents describe ‘occasionally’ as more seldom than ‘once

a month’.

**Annual demand is obtained by multiplying the frequency to the no. of operating days per year

Table 12. Present demand for dance workshop

Type/Genre Respondents who are willing to undergo dance workshop

Percentage (%) *Annual Demand Hip-hop 277 30.40 84 Jazz/Modern 277 25.79 72 Folk dance 277 10.48 29 Zumba 277 11.53 32 Others 277 21.7 60 Total 100% 277

* Annual demand is computed by multiplying the percentage of

each genre to the total annual demand Computations: Hip-hop = 277 x .3040 = 84 Jazz/Modern = 277 x .2579 = 72 Folk dance = 277 x .1048 = 29 Zumba = 277 x .1153 = 32 Others = 277 x .217 = 60

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Projected Demand

The projected demand for dance studio rental is calculated based on the present demand in the market compared with the growth rate of population per year which is approximately 3%. The table below shows the projected demand for dance studio for the next five years.

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Table 13. Projected demand for dance studio rental

Year Preceding Year’s Demand Growth Rate *Projected Demand

2017 2018 2019 2020 2021 16, 022 16, 503 16, 998 17, 508 18, 033 3% 3% 3% 3% 3% 16, 503 16, 998 17, 508 18, 033 18, 574

*Projected demand is obtained by multiplying the previous year

demand to the growth rate (1+0.03).

2017 = 16, 022 x 1.03 = 16, 503 2018 = 16, 503 x 1.03 = 16, 998 2019 = 16, 998 x 1.03 = 17, 508 2020 = 17, 508 x 1.03 = 18, 033 2021 = 18, 033 x 1.03 = 18, 574

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2017 2018 2019 2020 2021 15,000 15,500 16,000 16,500 17,000 17,500 18,000 18,500 19,000 16,503 16,998 17,508 18,033 18,574

Projected demand for dance studio rental

Year Projected Demand

Figure 2. Projected Demand for dance studio rental in the next 5 years

The projected demand for dance workshop is calculated based on the present demand in the market compared with the growth rate of population per year which is approximately 3%. The table below shows the projected demand for dance studio for the next five years. Table 14. Projected Demand for Dance Workshop

Year Preceding Year’s Demand Growth rate *Projected Demand

2017 2018 2019 2020 2021 277 286 295 304 314 3% 3% 3% 3% 3% 286 295 304 314 324

* Projected demand is obtained by multiplying the preceding year’s demand to the growth rate (1.03).

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Computations: 2017 = 277 x 1.03 = 286 2018 = 286 x 1.03 = 295 2019 = 295 x 1.03 = 304 2020 = 304 x 1.03 = 314 2021 = 314 x 1.03 = 324

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2017 2018 2019 2020 2021 260 270 280 290 300 310 320 330 285 294 303 313 323

Projected demand for dance workshops

Year Projected Demand

Figure 3. Projected Demand for dance workshop in the next 5 years

Supply Analysis

Supply is the schedule of various quantities of a specific product or service that will be available to consumers at a given time and place. Supply can also relate to the choice of consumers regarding price range. In this study, it pertains to the amount of service that the

proposed business can offer. Factors affecting supply in this study are the cost of service, related services, skills, and customer: dance

instructor ratio.

Factors affecting supply 1. Cost of service

Season of the year, employee salaries, utilities and other expenses affect the costs of the services offered.

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2. Related service

Competitions always exist in the market. The more business that offer the same service, the lesser market share will result. Related service that is offered by competitors could be the basis to determine how the service will be offered, promoted, advertised and innovated so that the service business will be more endorsed in the market than the other existing related services if there is any.

3. Skills

The skills and talents of the dance choreographer and instructors should be considered as a factor affecting the supply. The quality of service that will be rendered will depend on the coaching and

apprenticeship of the employee regarding dance tutorials and workshops.

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4. Customer: dance instructor ratio

The capacity of the dance instructor to handle customer and the recommended ratio to be administered affect the quality of service they give. The smaller the ratio of customer per instructor, the better supervision they can provide, otherwise the fewer supervision they can offer.

Unsatisfied Demand

Unsatisfied demand usually rises when the supply is insufficient to cover the demand in the market. It is realized by deducting the

demand for the year from the supply of the same year. This study has no supply because there is no available business offering the same service. Here in Calamba City, particularly in Barangay Poblacion, there is no existing business service related to the establishment of a dance studio.

There are aspiring dancers and those who just wanted to dance out there that do not have the place where they can enhance their talents. Currently in Calamba City, there are a few dance studios but treated as other services offered because they are actually focused on a dance school business. These dance schools who offer the same service as this dance studio will offer are located distant from the location indicated in the general market description. Therefore, there is no supply and it is equivalent to zero as formulated here in the equation:

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Unsatisfied demand for studio rental = Total Demand – Total Supply

= 16, 022 – 0 = 16, 022

Unsatisfied demand for dance workshop = Total Demand – Total Supply

= 277 – 0 = 277

Market Share of JAST Dance Studio Rental

Market share is the portion of total sales in relation to the market it operates within. It can be computed from a company’s total sales revenue in the market divided by the total sales revenue available from the market.

Total Annual Capacity (dance studio) =

2

(

Operating Hours

2 Minimum Hours

)

×Total Operating Days

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(9.5/2)*48 228

2,51 8

Market Share = Total Annual Capacity_{Projected Demand} ×100

=

(

_16,0222,518

)

× 100 = 15.72%

16%

84% Market share for JAST dance studio rental Unsatisfied demand for dance studio rental

Figure 4. Market share of dance Studio Rental for 2016 Table 15. Market share for dance studio rental for the next five years.

Year

Annual Capacity

(AC)

Efficiency

Rate (ER) AC x ER Projected Demand _{share (%)}*Market

2017 2,518 90% 2,267 16, 503 13.73

2018 2,518 92% 2,317 16, 998 13.63

2019 2,518 94% 2,367 17, 508 13.52

2020 2,518 96% 2,418 18, 033 13.41

2021 2,518 98% 2,468 18, 574 13.29

* Market share is computed by dividing AC x ER to the projected demand.

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14%

Figure 5. Market share for dance studio rental for 2017

14%

Figure 6. Market share for dances studio rental for 2018

14%

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13%

Figure 8. Market share for dance studio rental for 2020

13%

Figure 9. Market share for dance studio rental for 2021 Total Annual Capacity (workshop) = CC x level x genre

= 15 x 2 x 3 = 90

= customer per day = 20

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Market Share = Total Annual Capacity_{Projected Demand} ×100

=

(

110₂₇₇

)

×100

= 39.71%

Legend: CC – customer per class

Level – this is either “beginner” or “intermediate”

Genre – this are the types of dance a customer want to enroll (Hip-Hop, Jazz, Folk dance)

40% 60%

Market share for JAST dance workshop Unsatisfied demand for dance workshop

Figure 10. Market share for dance workshop for 2016 Table 16. Market share for dance workshop for the next five years.

Year CapacityAnnual (AC)

Efficiency

Rate (ER) AC x ER Projected Demand Marketshare (%) 2017 110 90% 99 286 34.62 2018 110 92% 102 295 34.58 2019 110 94% 104 304 34.21 2020 110 96% 106 314 33.63 2021 110 98% 108 324 33.27

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35% 65%

Figure 11. Market share for dance workshops for 2017

35% 65%

34% 66%

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34% 66%

33% 67%

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Competitive Position

Competitive Positioning is about carving out a spot in the

competitive landscape and being known for something and it sets the service apart from the competitors. (www. marketingmo.com/strategic planning/competitive-positioning/)

It is said to be in a competitive position when the service has attained a noticeable percentage share of the market. The proposed business, which will be the first dance studio to be established here in Barangay Poblacion, will offer high quality services that would be a great advantage over the target market. JAST Dance Studio will be positioned in a community with the right demography that will attract customers upon the first day of operations.

Lastly, our employees will be provided with a good compensation program and benefits that will motivate them to work at their best all the time.

Marketing Program

Service

The proposed business’ aim is to provide Innovative, Trendy, and

Fresh experience to the customers. And in order maintain its quality; the people behind the future success of the project should be

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working condition. Facilities are well-maintained and well-ventilated for the comfort of the customer.

Price

Pricing plays a vital part in marketing the services offered. The

price for the rental service will be P450.00 per hour with 2-hour

minimum practice. On the other hand, offered price for zumba under a choreographer will be on a per session basis while workshops will be P900.00 per session or with a total of P10,800.00 for the whole

enrolment (P900.00 x 12 sessions) for both beginner and intermediate level exclusive of recitals. The recital fee will be based on the venue of the said activity. More or less it will cost each students P200.00.

Place

The place of the proposed business will be established along

Barangay Uno, Calamba City. The secondary target markets are the remaining barangays in Calamba. These remaining barangays are applicable only if the proponents decided to expand the business.

Promotion

In promoting JAST Dance Studio, the social media will be used as

the main platform. A Facebook page will be created containing the list of services that will be offered and will also be used to communicate with the customers, the location of the studio, and the features of the

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said business by means of uploading photos to the said page.

Tarpaulin will be posted at areas located around Barangay Poblacion. Furthermore, business cards will also be available for other

customers. Additionally, the proposed business will be having its “ZumBarangay: Free Zumba Class for a week” to promote the proposed business to each residents of Barangay Poblacion. “JAST Dance Contest” will also be conducted to encourage dancers of

different genres to showcase their talents. Winners will be given cash prize and discounts for every dance studio rental they will avail. Table 17. Marketing cost and expenses

Particulars Quantity Unit cost in Peso Amount in Peso

Tarpaulin (6 x 8 ft.) 3 720 2, 160

ZumBarangay (Free Zumba

Class for 1 week) 1,750

JAST Dance Contest 4,500