PROFITABILITY OF SELECTED INTERNET CAFES IN LEGAZPI CITY

An Undergraduate Thesis Presented to the Faculty of the College of Business Education Divine Word College of Legazpi Legazpi City

In Partial Fulfillment of the Requirements for the Degree of Bachelor of Science in Management and Accountancy

By: MARISTELA, KATHERINE KATE M. LEGASPI, AIMEE R.

March 2013

DIVINE WORD COLLEGE OF LEGAZPI i

College of Business Education Legazpi City

RECOMMENDATION FOR FINAL DEFENSE This thesis entitled, PROFITABILITY OF SELECTED INTERNET CAFES IN LEGAZPI CITY prepared and submitted by KATHERINE KATE M. MARISTELA and AIMEE R. LEGASPI, in partial fulfillment of the requirements for the Degree of Bachelor of Science in Management and Accountancy is hereby recommended for consideration and approval. PROF. DIANA MILLENA, CPA Thesis Adviser THESIS COMMITTEE This thesis entitled, PROFITABILITY OF SELECTED INTERNET CAFES IN LEGAZPI CITY prepared and submitted by KATHERINE KATE M. MARISTELA and AIMEE R. LEGASPI, as recommended, is hereby endorsed for Final Oral Defense.

TERESITA Ll. NACION, Ed. D. Chairperson

ENGRAGIO M. LUCIADA, CPA Member Date: March 2013

NICETAS F. MARILAG, CPA, MBA Member

ii

DIVINE WORD COLLEGE OF LEGAZPI College of Business Education Legazpi City

RESULT OF THE ORAL EXAMINATION Candidate Thesis Title Place Date Time : : : : : ACTION TAKEN KATHERINE KATE M. MARISTELA AIMEE R. LEGASPI PROFITABILTY OF SELECTED INTERNET CAFES IN LEGAZPI CITY CBE DEFENSE ROOM MARCH 2013

PANEL OF EXAMINERS

TERESITA Ll. NACION, Ed. D. Chairperson

_______________

ENGRAGIO M. LUCIADA, CPA Member

_______________

NICETAS F. MARILAG, CPA Member

_______________

DIVINE WORD COLLEGE OF LEGAZPI College of Business Education iii

Legazpi City

APPROVAL SHEET Upon the recommendation of the Oral Examination Committee, this thesis entitled, PROFITABILITY OF SELECTED INTERNET CAFES IN LEGAZPI CITY prepared and submitted by KATHERINE KATE M. MARISTELA and AIMEE R. LEGASPI, in partial fulfillment of the requirements for the Degree of Bachelor of Science in Management and Accountancy is hereby approved.

PROF. MA. DARIA N. LABALAN, CPA, MBA Class Adviser

TERESITA Ll. NACION, Ed. D Dean, College of Business Education

DIVINE WORD COLLEGE OF LEGAZPI College of Business Education Legazpi City iv

CERTIFICATION This is to certify that the thesis entitled, PROFITABILITY OF SELECTED INTERNET CAFES IN LEGAZPI CITY prepared and submitted by KATHERINE KATE M. MARISTELA and AIMEE R. LEGASPI for the Degree of Bachelor of Science in Management and Accountancy has been edited by the undersigned, and reviewed to conform to the institutional format of Divine Word College of Legazpi, College of Business Education and elements of technical writing. ISSUED this _____ day of __________ 2011.

Editor

ACKNOWLEDGEMENT

The success of this labor is due to the enthusiasm that the researchers attained from different individuals who aided them to complete this research. The researchers want to express their deep admiration and humble gratitude to the following: To the whole administration of Divine Word College of Legazpi headed by REV. FR. CRISPIN A. CORDERO, SVD, President, in guiding and upholding as a role model in the institution and in exemplifying professionalism, excellence and service. TERESITA Ll. NACION, Ed. D., Dean of the College of Business Education and chairperson for her available time and suggestions in completing a quality research paper. PROF. ENGRACIO M. LUCINADA, CPA, and PROF. NICETAS F. MARILAG, CPA, MBA the panel members for giving the researchers suggestions and recommendations in this studies to complete a quality research manuscript. PROF. DIANA MILLENA, CPA, the thesis adviser who patiently guided the researchers on the constraints encountered in providing insights and understanding to achieve quality content in the study. PROF. MA. DARIA N. LABALAN, CPA, MBA, the class adviser who unselfishly offered and extended guidance by entertaining the questions of the researchers and explaining important information in the study. To the respondents of this study for their cooperation, patience and willingness to provide the necessary information made a lot of help in this study. The Librarian and other library personnel of Divine Word College of Legazpi for lending the necessary materials used in this study. Our group of friends for giving encouragement and strength in pursuing with this endeavor.

vi

Our dear parents and family relatives who have rendered assistance on financial, emotional and moral aspect to be able to continue swiftly with the research. And above all, the researchers would like to extend their deepest gratitude to the Almighty God for endowing them with blessings, strengths, courage and wisdom in accomplishing their goals and in guiding them through this presence in the entire process of this venture.

KKMM and ARL

ABSTRACT

MARISTELA, KATHERINE KATE M. vii

PROFITABILITY OF SELECTED

LEGASPI, AIMEE R.

INTERNET CAFES IN LEGAZPI CITY (An Undergraduate Thesis, Divine Word College of Legazpi, March 2013)

Summary The research work was conducted to determine the profitability of selected Internet Cafes in Legazpi City. The research focused on the profile, profitability status along monthly revenues and monthly expenses and the strengths, weaknesses, opportunities and threats of the selected internet cafes.

This research is focused on the profit of Internet Cafes in Legazpi City. Precisely, the study attempted to answer the following questions: 1. What is the profile of the selected internet cafes in Legazpi City in terms of : 1.1. Type of Business 1.2. Numbers of Years in Operation 1.3. Capitalization 1.4. Number of Computer Units 1.5. Average Number of Daily Customers 2. What is the profitability status of the internet cafes along the following areas: 2.1. Monthly Revenues 2.2. Monthly Expenses viii

3. What are the strengths, weaknesses, opportunities and threats of the selected internet cafes? The researchers used descriptive method in analyzing, interpreting and presenting the information gathered. Statistics used were frequency count and percentage. This study was conducted in a span of one semester during the school year from the month of November 2012 until March 2013. The researchers gathered data necessary to answer the questions aided by the questionnaire guide.

Findings Based on the analysis of the data, the findings were: 1. Business Profile. Majority of those who operates internet caf business in Legazpi City are under sole proprietorship. As to numbers of years in operation, it shows that 4 of the respondents have been operating for 3 years, 3 are operating for 1 year, 2 are operating for 2 years and the rest are operating for more than 3 years. In terms capitalization, the entire internet caf started operating out of their own investment. 5 out of 15 have invested P500,001 and above, 6 have invested in the range of P250,001 to P500,000, and 4 have invested in the range of P100,001 to P250,000. In terms of number of computer units, shows that 5 of the respondents have 10 to 14 computer units and 10 of the respondents have 15 to 20 computer units. And in terms of average number of daily customers, it shows that 8 of the internet cafes have range of 10 to 19 customers daily, 3 have a range of 20 to 29 customers daily, 3 have a range of 30 to 39 customers daily and 1 have 40 and above customers daily.

ix

2. Profitability Status. The average monthly revenue, shows that majority of the respondents have monthly revenues ranging from P30,000 to P49,999 while average monthly expenses, shows that majority of the respondents have monthly expenses ranging from P10,000 to P19,999. 3. The SWOT analysis reveals the following: In terms of strengths, all respondents considered the up-to-date software, provides many services and accessible place as their strengths that contributes to the profitability of their business. In terms of weaknesses, majority of the respondents do not have a

check or have a minimal number of checks on the list of weaknesses given in the questionnaire. As to opportunities, majority of the respondents have a high

number of checks to the list of opportunities given in the questionnaire. And in terms of threats, majority of the respondents have high number of checks on the list of threats given in the questionnaire.

Recommendations Based on the findings of this study, the following recommendations are formulated. Conclusions Based on the findings,

TABLE OF CONTENTS PAGE TITLE PAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RECOMMENDATION FOR FINAL DEFENSE . . . . . . . . .. . . . . . . . . . . . . . . . . . . . THESIS COMMITTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RESULT OF THE ORAL EXAMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . APPROVAL SHEET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CERTIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ACKNOWLEDGEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ABSTRACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . TABLE OF CONTENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . LIST OF FIGURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CHAPTER I: THE PROBLEM AND ITS SETTING Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Statement of the Problem . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Scope and Delimitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Significance of the Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CHAPTER II: REVIEW OF RELATED LITERATURE AND STUDIES Related Literature. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Synthesis of the State of the Art . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gap Bridged by the Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xi 7 17 17 1 3 4 4 6 i ii ii iii iv v vi viii xi xiv

Theoretical Framework . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Conceptual Framework. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Definition of Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CHAPTER III: RESEARCH DESIGN AND METHODOLOGY Research Method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Sources of Data. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Population and Respondents of the Study. . . . . . . . . . . . . . . . . . . . . . Research Instrument . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Data Gathering Procedure. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Statistical Treatment of Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CHAPTER IV: PRESENTATION, ANALYSIS AND INTERPRETATION OF DATA Business Profile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . a. Type of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . b. Numbers of Years in Operation . . . . . . . . . . . . . . . . . . . . . . . . . . c. Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

19 20 23 25

27 27 27 28 28 28

29 29 29

30 30 30
31 37

d. Number of Computer Units. . . . . . . . . . . . . . . . . . . . . . . . . e. Average Number of Daily Customers . . . . . . . . . . . . . . . . .

Operational Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Swot Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

CHAPTER V: SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Findings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Conclusions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BIBLIOGRAPHY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xii 40 41 43

APPENDICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A Letter Request to Conduct the Study. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B Questionnaire Based Interview Guide. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C Sources of Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D Tourist Arrival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E Rules and Regulations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CURRICULUM VITAE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

xiii

LIST OF FIGURES FIGURES 1 Theoretical Paradigm. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Conceptual Paradigm. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . PAGE 19 20

xiv