Gardenia Final Paper

I. SITUATIONAL ANALYSIS A. SWOT/TOWS ANALYSIS Strengths Gardenia bread is a top-bread maker and a well-known brand in the bread industry. The company is recognized as the most outstanding bread manufacturing in the product category by the consumer Urion of the Philippines (CUP) held yearly during its Annual National Consumer Award (ANCA). Gardenia, being a consumer-focused and branded food company, is singularly driven in delivering superior consumer value through providing consumers with superior products. The Gardenia trademark means value and is respected all over Asia. Gardenia Philippines pioneers a unique distribution system, ensuring only fresh breads reach consumers every day. Gardenia strictly follows its international policy of keeping only fresh stocks on the store shelves. The combination of superior product quality, advanced bread-making technology, and extensive system of distribution reflects the consumer-oriented vision of Gardenia Philippines that brings consumers the highest level of product satisfaction. Its better marketing skills and ability to make rapid expansion, contribute a lot to Gardenia’s success which is evident with its continuous and rapid sales growth. Weaknesses Gardenia uses price skimming strategy which targets Class B and C with ₱15,000 and above income which results to limited availability to lower-end market. Gardenia distributes only its products to wholesalers/retailers but has no stand-alone stores to sell its own products. Gardenia also lacks online

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services for its customers’ convenience. In terms of profitability, Gardenia is doing well but not that much because bread sector is not a highly profitable sector. Opportunities Gardenia is continuously expanding and striving to maximize the opportunities such as rapid market growth, changing customer needs/preferences, economic boom/downturn, new technology, sales decline for substitute products, and evolving business models in the industry to remain competitive and meet the needs/preferences of its customers. New technology will help Gardenia produce more fresh and high quality products to offer to its several customers. Different social media sites will also help Gardenia reach and serve other customers easily and conveniently. Threats Economic boom/downturn, bargaining power of buyers/suppliers, changing customer needs/tastes, new technology, increase in government regulation, and introduction of new substitute products are some of the threats that might affect the market demand and sales of Gardenia if not monitored and controlled properly. Affordability among Filipino customers is also one of the threats faced by Gardenia because they cannot price its products in the Philippines as they should be. Different economic issues and government malpractices could affect Gardenia’s operations and strategies and could make the business uncompetitive. Even a small change can affect the position of the brand.

TOWS ANALYSIS

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External Opportunities (O) 1. Rapid market growth 2. Changing customer needs/tastes 3. Economic boom/downturn 4. New technology 5. Sales decline for substitute products 6. Evolving business models in the industry

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1. 2. 3. 4. 5. 6.

External Threats (T) Economic boom/downturn Bargaining power of buyers/suppliers Changing customer needs/tastes New technology Increasing government regulation Introduction of new substitute products

Internal Strengths (S) 1. Well-known brand image 2. Superior quality products 3. Better marketing skills 4. Growing product line 5. Wide coverage and distribution 6. Ability to make rapid expansion 7. Supply power

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Internal Weaknesses (W) 1. Limited availability/penetration to lower-end market 2. No stand-alone stores 3. Online services

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SO Strengthen brand image through better marketing skills and promotional tools Maximize the use of technology for better performance towards producing quality and health conscious products to retain loyal customers and gain potential customers Continue developing advertisements and other marketing programs/activities to promote new products and attract target market Enhance product line to increase market share

WO Look for suppliers offering cheaper yet quality raw material to produce affordable products that will cater the lower-end market Adopt new technology to provide online services and create online promotions that will strengthen its brand image and gain potential market Expand business by Page 4

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ST Continue producing innovative, distinctive, and high quality products to retain loyal customers and gain new potential customers Develop marketing skills and promotional tools to attract new customers and increase sales Empower brand name through advertisements in making quality and health conscious products to overcome threats Adapt to policy, technological and other changes to continue providing quality products/services WT Innovate products to overcome threat of customer changing needs/tastes and other threats Produce affordable yet quality products that will cater the lowerend market Establish stand-alone stores to expand business and offer more products to increase market share

building stand-alone stores to offer new products and other services to cater more customers

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and attract more customers/investors Maximize the use of websites and social media sites to promote products and create buzz online Provide online services for convenience and easy access to products and product info.

B. PEST ANALYSIS Political/Legal Factors Government rules and regulations affect Gardenia’s operation because of it has to cope with the changes imposed by the Government. These rules will help Gardenia improve its business operation but also it could have negative impact on it since the government has control over the products and its price. Gardenia is expected to comply with the requirements ordered by the government. Taxation policy affects the production costs of Gardenia. The price of Gardenia breads depends on the price of its raw materials and higher taxes on these raw materials indicates an increase in price in production costs of Gardenia which is also an indication of an increase in the price of Gardenia products. Economic Factors Key economic indicators include interest rates, gross domestic, retail price index, unemployment rates and exchange rates. Philippines provide a growing market for premium food product. Economy growth, and especially employment in services sector jobs, is driving demand for more convenient and prepared Page 5

foods. Gardenia believes that the Gardenia’s success is brought regarding by the dedication and commitment of each member of the Gardenia family. These dedications are leading Gardenia to be the no1 in bread industry. During global economic crisis, the industry had a flat growth but Gardenia continue to grow by two to four percent. Gardenia should continue encouraging and providing more opportunities for employment while making Gardenia bread more widely available conveniently to customer. Due to changes in economic factors such as increase in interest rates could affect demand of customer for Gardenia products and this could be an opportunity for the substitute products which might have negative impact on Gardenia’s operation and profit. Socio-Cultural Factors Rapid growth of population in the Philippines is an indication of growth of potential customers of Gardenia which could increase the demand for its products. Socio-cultural forces will affect the values, beliefs, and lifestyles of a society. Over the past few years, rising levels of obesity, heart disease, and diabetes in the Philippines have rapidly increased consumer interest in healthy and nutritionally food and government interest in promoting healthier eating and lifestyles. Breakfast is important for people for having healthier. According to the Philippine Association of Flour Millers Inc. (PAMFIL) said that 85 percent of Filipinos’ prefer to eat bread instead of rice for their breakfast. Consumers are willing to pay anything that will make healthy and fit. Technological Factors Developments in technology lead to new products and services and improve how they are produced and delivered to the end user. As the top-bread maker and leader of bread manufacturing industry, Page 6

Gardenia using state-of-the-art-bread manufacturing plant is capable making 6000 loaves of bread per hour or nearly 150000 loaves per day. It is the equipment whereby almost untouched by human hands. Therefore, it ensures providing safe and best quality of bread product. New baking tools and equipments will help enhance/speed up Gardenia’s production. The development of internet is an opportunity for Gardenia to promote its products online and enhance its brand image. Gardenia could enhance its website and maximize the use of social media to offer online services and reach new potential market. This will help Gardenia increase its market share and influence customer purchasing decisions. C. INDUSTRY ANALYSIS Threat of New Entrants (Medium Pressure) In these high competitive industry, there are a lot possibility that new competitor enter to the industry. Indirectly, new entrants to industry will lead threat that might decreasing level of customer loyalty and will be highly competition in between. Capital requirement for investment in bread industry in purchasing those raw material and machinery before the entrant could begin selling the product. In additional, certain market share need to be capture for the new entrant before it could reap the necessary economies of scales to allow it with rival firm. Gardenia produces affordable products and enjoys the economies of scales to compete effectively. Gardenias enjoy fairly high product differentiation whereby retailers prefer of brand recognition and customer loyalty. Therefore, it results harder for new entrants to enter the market. Bargaining Power of Buyers (Low Pressure)

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Individual customer does not influence much to bakery industry. Gardenia main buyers are like hypermarket and retailers which pay lots for every year. Therefore, bargaining power is low due to a lots distributor getting resources (bread product) from Gardenia and selling it to end-user. The product for Gardenia is differentiated base on the quality. Buyers are not easy to always find alternative suppliers. In relation to buyer power in Gardenia industry seeks to enhance customer loyalty in focusing existing relationships and trying maintaining in longterm relationships with buyers. Bargaining Power of Suppliers (Medium to High Pressure) Suppliers of Gardenia have a great bargaining power especially for those monopoly products. For example, flour is the main raw material in producing bread. There are few substitutes to their product.

Threat of Substitute Products (High Pressure) The threat of substitute for Gardenia product is high within the industry. Consumer is looking for bread with attracting topping and decoration. For example, those bakery shop usually providing filling bread and attractiveness bread which meet the expectation of customer. Other industry such as fast food also providing breakfast value which meal serve with bread. It becomes a threat to Gardenia. Current Category Rivalry (Medium to High Pressure) Gardenia’s operates in a highly competitive industry. Some of the competitor are by low priced confectionery producers which are small family-run businesses whereby producing bread that are sold Page 8

in the neighborhood which called small-scale production for the local market. On the other hand, a few large competitors such as Golden Donuts, Inc or Red Ribbon Bake Shop, Inc also produce affordable products. Baking of bread, cakes, pastries, pie and similar “perishable” bakery products D. MARKET ANALYSIS a. Market Size Philippines market in Baked Goods industry is growing fast by this time. Filipino market who consumes baked goods products such as pastry, cakes, breads and cereals. Market of Baked goods industry reached 48% share of total sales as of 2013 and expected to reach higher on 2015. There is a big part of new potential market that is health conscious and can account a lot of share in the sales of the baked goods since the trend in the industry is healthier products to come out.

b. Market Growth Rate In 2013, Philippines’ strong performance in economy helped the Baked Goods industry to work well. Due to fact that Filipinos are starting to consume breads, pastries and cakes more frequently. The market for the baked goods and cereals industry in Philippines increased at aggregate annual growth of 3.4 %. Baked goods industry is dominated by small bakeries which bake and sell their products on-site. In 2013, it is expected that unpackaged/artisanal offerings will account for a 48% share of total sales in baked goods. Amongst packaged/industrial players, Gardenia Philippines is expected to see the biggest revenue contribution. The company share is expected to reach 11% in 2013. Gardenia Philippines Page 9

banks on its reputation as a manufacturer of freshly baked bread which is delivered to retailers daily. In recent years the company expanded its product line to include pastries, high fiber bread and healthier alternatives. c. Market Profitability • Buyer Power - This has a lot of effect on the profitability of Gardenia since they have loyal buyers and alliances that make their profit higher. • Supplier power – Supply for the products are bound to be attainable since it is available nationwide and they have extensive mass distribution of the products. • Barriers to entry - The profitability in this force can affect the market and its industry since switching costs in the market are likely to happen in Philippines economy. • Threat of substitute products – Implications in this force is low because of the fact that Gardenia has strong brand image and large amount of market. They can still get higher market profitability. • Rivalry among firms in the industry – Rivalry can affect the profitability of the company but since Gardenia top the market share for the past few years, their profitability in this force are much unlikely to step down. d. Industry Cost Structure Firm Infrastructure: Market strategy, market policy, organizational structure, company culture Human resource management: staff’s training and development, market research, hiring, compensation Technology Department: transaction processing system, production unit database, sales Procurement: purchasing raw materials, supplies, equipment e. Distribution channels Gardenia Philippines pioneered a unique distribution system, ensuring that only fresh breads will reach consumers every day. It strictly follows its international policy of keeping only fresh stocks on the store shelves. Delivery vans leave the production plant as early as 4 o’clock in the morning to distribute the products in specific locations nationwide as soon as it is produce from the factory. Page 10

Gardenia Philippines always replace unsold breads with their freshly baked premium quality breads and other products. Gardenia conducts extensive mass distribution of their product through Retail Stores, Supermarkets, direct selling and grocery stores. Sponsorship in events helps the company to distribute and promote their product by this new channel. Products of Gardenia are mostly available nationwide, because of its availability in the channel power. f. Market Trends Product Quality - The preference for high-quality product of Market is increasing in light of the fact that they appreciate the qualitative differences. Health Consciousness – People nowadays want to live in healthy way, seems everyone is getting fit and healthy, these are potential market and they are growing. Appearance – Market who consumes bread and wheat products are tend to look for more appealing products than the usual. Selection - People are demanding a larger variety of breads. They don’t look for common breads, pastry, cakes nowadays. g. Key Success Factors Gardenia provides premium quality products that give satisfaction to their customers. Since Gardenia Bakeries established their brand image through the years it is one of the key success factors that they have.

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Technologies nowadays, tapped industries along the lines of computer, phone and other gadgets, having advance bread-making technology of Gardenia, it made as their edge to the other competitors. Gardenia has extensive system of distribution to the country, they have pedicarts, pushcarts and now they are available to supermarkets, sari-sari store and every so often they are also conducting school to school programs that help them to be efficient to the consumers. Gardenia being an established company their key success factor would be the strong financial position in the industry that makes them more in demand. E. CUSTOMER ANALYSIS The Gardenia Bakeries Philippines Inc. exists to satisfy the consumers’ needs. They are able to provide breads for many different target markets including, people of all ages, sexes, races, etc. Gardenia products are able to sell to a diverse worldwide population. MARKET SEGMENTATION Gardenia is certainly for everybody-whether you are a student, working professional, young, young-atheart, dieters, nutrition-seeking families, health conscious and On-The-Go. DEMOGRAPHIC SEGMENTATION 

Social Class

Gardenia products are purchased by all the different classes, but mainly by the

middle and upper class citizens. Freshly baked products at a reasonable and justifiable price is what Gardenia strives to provide for their customers. A comfortable and convenient atmosphere provides a place where the customer can free themselves from buying the products. Page 12

Gardenia have supply the bread to all the convenience shop, hospital, school, supermarket, provision store and hypermarket. Due to the increase in demand of bread, Gardenia has to start to increase the supply of bread to the market. Gardenia focused on meeting the expectations of its target consumers. These are: First, freshness. Everyone likes to eat bread that’s just come out of the oven. Gardenia responded to this need with the G-lock as assurance for freshness. The g-lock is a small but durable resalable clip used to seal in the bread’s freshness. There is seven G-lock colors assigned for the seven days of the week, making it easier in pulling out unsold breads every day of delivery, and to make sure that only newly baked breads are displayed on store shelves. Gardenia’s unique G-lock system keeps consumers informed of the date the bread is baked for, the suggested retail price, the production line the bread was produced, and batch number. Second is taste. The local term for loaf bread is “tasty.” In the case of Gardenia, to differentiate the promise of taste, it claimed “masarap kahit walang palaman.” Gardenia uses only the finest ingredients from all over the world. Next is aroma. Filipinos believe that food must smell good to taste good. Inaamoy muna bago kinakagat. The natural freshness and enticing smell of Gardenia breads stand out among other brands. Fourth is softness. They also prefer soft breads, because for them, softness means freshness. For them, the bread is old if it is not soft. It is a common observation that when buyers approach the bread shelves, they pinch and squeeze the bread. And did you ever notice that Gardenia loaf slices can be rolled without breaking? Try this out!

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Nutritive Value. And of course, eating’s purpose is primarily for nourishment and nutrition. The nutrients most of us need are Vitamin A, Iodine, and Folate. Gardenia breads are fortified with essential vitamins and minerals that make it really nutritious.

MARKET NEEDS Gardenia Bakeries Philippines Inc. offers the following benefits to its customers Nutrition, Accessibility, Convenience, Customer Service, Atmosphere and Selection MARKET TRENDS Every consumer has different needs and wants, so Gardenia supplies many variety of bread in order to meet the demand of the consumer in order to satisfy them. Demand is a principle that the consumer willing to pay for the price and also desire to buy the goods and services. Consumers are very delicate when it comes to the food purchasing. Especially in the Philippines, they want their breads to be fresh in the oven. Knowing this, Gardenia Bakeries Philippines Inc. thought of how to ensure their market in the country whenever purchasing their product. SURVEY RESULTS: Table 1. Demographic profile of the respondents according to their age: AGE

FREQUENCY

PERCENT

12-20 20-30 30-40 40-50 50 and up

15 10 0 6 0

48% 32% 0% 19% 0%

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TOTAL

31

100%

Table 1 (See Appendix for chart presentation) The researchers conclude that most of the respondents are students and belongs to Gen Y. Table 2. Demographic profile of the respondents according to their location: AGE

FREQUENCY

PERCENT

Laguna Imus Las Piñas Cavite Muntinlupa Silang Dasmariñas Bacoor Makati Manila TOTAL

1 6 7 2 1 1 3 4 1 1 27

.04% 22% 26% .07% .04% .04% 11% 15% .04% .04% 100%

Table 2 (See Appendix for chart presentation) The researchers conclude that most of the respondents are from Las Piñas City. Table 3. Do you eat bread? AGE

FREQUENCY

PERCENT

Yes No TOTAL

31 0 31

100% 0% 100%

Table 3 (See Appendix for chart presentation) The researchers conclude that all of the respondents eat bread. Page 15

Table 4. If you don’t eat bread, do you buy bread for your family? AGE

FREQUENCY

PERCENT

Yes No TOTAL

23 8 31

100% 0% 100%

Table 4 (See Appendix for chart presentation) The researchers conclude that most of the respondents buy bread for their family. Table 5. How often do you eat bread? AGE

FREQUENCY

PERCENT

Once a day Twice a day Once a week Others (every other day,

15 4 9 3

48% 13% 29% 10%

31

100%

most of the times in a week pag may tinapay lang or trip mag burger TOTAL

Table 4 (See Appendix for chart presentation) The researchers conclude that most of the respondents consume bread once a day. Table 6. Which meal of the day do you consume bread? AGE

FREQUENCY Page 16

PERCENT

Breakfast Lunch Snacks Dinner Others (every other day,

26 0 23 4 0

49% 0% 43% % 0%

53

100%

most of the times in a week pag may tinapay lang or trip mag burger TOTAL

Table 5 (See Appendix for chart presentation) The researchers conclude that most of the respondents consume bread during Breakfast. Table 7. Have you tried Gardenia before? AGE

FREQUENCY

PERCENT

Yes No TOTAL

31 0 31

100% 0% 100%

Table 7 (See Appendix for chart presentation) The researchers conclude that most of the respondents prefer Gardenia bread. Table 8. Where do you usually buy bread from? AGE

FREQUENCY

PERCENT

Supermarket Sari-Sari Store

28 3

84% 10%

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Convenience Store Bakeries Drug Stores Others TOTAL

4 7 1 1 31

13% 23% 3% 3% 100%

Table 8 (See Appendix for chart presentation) The researchers conclude that most of the respondents buy breads Supermarket. Table 9. Why do you choose bread from there? AGE

FREQUENCY

PERCENT

Quality Services Convenience Locations Publicity of the Store Membership Rebates Others TOTAL

18 19 2 1 1 41

58% 61% 6% 3% 3% 100%

Table 9 (See Appendix for chart presentation) The researchers conclude that most of the respondents buy breads Supermarket because of Convenience and Quality Service. Table 10. What are the criteria(s) you look for when choosing the brand of bread to eat? AGE

FREQUENCY

PERCENT

Softness Freshness Availability Nutrition Price

21 28 8 14 14

68% 90% 26% 45% 45%

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Packaging Flavors Others TOTAL

9 8 0 41

29% 26% 0% 100%

Table 10 (See Appendix for chart presentation) The researchers conclude that the top 3 qualities that consumers consider in choosing bread to eat are softness, freshness and nutrition and price. Table 11. Which new forms of packaging would you prefer? AGE

FREQUENCY

PERCENT

Box-form (Travel-pack, Picnic-pack, etc) Ziplock Mini Size Sandwich I don’t want to change the

5

16%

16 2 11

52% 6% 35%

packaging Others TOTAL

0 41

0% 100%

Table 11 (See Appendix for chart presentation) The researchers conclude that most of the respondents prefer Zip Lock as the new packaging for Gardenia Breads. Table 12. Which type did you try before? AGE

FREQUENCY

PERCENT

White Bread (Classic White Bread Regular and

27

87%

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Thick Slice, Health Bread (High Fiber Whole Wheat Bread, High Fiber Wheat Raisin Loaf and Slim n Fit Wheaten Bread), Snack Items (Twiggies Yellow Cake, Cream Roll, Fun Bun, Muffin) Health Bread (High Fiber Whole Wheat Bread, High Fiber Wheat Raisin Loaf and Slim n Fit Wheaten Bread) Pandesal and Buns (Premium Pandesal, Softdelight pandesal, Whole wheat pandesal, Hotdog Bun, Hamburger Bun) Snack Items (Twiggies Yellow Cake, Cream Roll, Fun Bun, Muffin) Crunchy-licious Toasts (Butter Toast, Garlic Toast, Cinnamon Toast) Others TOTAL

18

58%

14

45%

13

42%

11

35%

0 83

0% 100%

Table 12 (See Appendix for chart presentation) The researchers conclude that most of the respondents prefer have tried White Bread (Classic White Bread Regular and Thick Slice, Health Bread (High Fiber Whole Wheat Bread, High Fiber Wheat Raisin Loaf and Slim n Fit Wheaten Bread), Snack Items (Twiggies Yellow Cake, Cream Roll, Fun Bun, Muffin) products of Gardenia Breads.

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Table 13. If Gardenia Bakeries would add products on their product line, what products you think would be appealing to the consumers? AGE

FREQUENCY

PERCENT

Gardenia Spreads Gardenia Jam and Marmalade Gardenia Cream Filled Biscuits Gardenia Mamon and Ensaymada Gardenia Filipino Biscuit Gardenia-To-Go (Ready to eat sandwich) Gardenia Hot Drinks Others TOTAL

12 7

39% 23%

4

13%

19

61%

5 9

16% 29%

4 0 60

13% 0% 100%

Table 13 (See Appendix for chart presentation) The researchers conclude that most of the respondents prefer “Gardenia Mamon and Ensaymada” to be part of the new products for Gardenia Breads. Table 14. If Gardenia Bakeries would launch the "Gardenia Spreads", what flavors would you consider buying? AGE

FREQUENCY

PERCENT

Tuna Spread Choco Spread Chicken Spread Ham Spread Peanut Butter Spread Others TOTAL

15 14 12 6 12 2 61

48% 45% 39% 19% 39% 6% 100%

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Table 14 (See Appendix for chart presentation) The researchers conclude that most of the respondents prefer Tuna flavoured spread. Table 15. If Gardenia Bakeries would launch the "Gardenia Jams and Marmalade", what flavors would you consider buying? AGE

FREQUENCY

PERCENT

Mango Strawberry Orange Pineapple Coconut Blueberry Others TOTAL

11 17 1 5 6 12 1 61

35% 55% 3% 16% 19% 39% 3% 100%

Table 15 (See Appendix for chart presentation) The researchers conclude that most of the respondents prefer Strawberry flavoured Jam and Marmalade. Table 16. If Gardenia Bakeries would launch the "Gardenia-to-go" (Ready to eat sandwiches), what flavors would you consider buying? AGE

FREQUENCY

PERCENT

Ham and Cheese Sandwich Chicken Sandwich Bacon and Egg Sandwich TLC Sandwich

19

61%

13 18 13

42% 58% 42%

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Tuna Others TOTAL

13 0 76

42% 0% 100%

Table 16 (See Appendix for chart presentation) The researchers conclude that most of the respondents prefer Ham and Cheese flavoured Sandwich. Table 17. Overall, are you satisfied from the products of Gardenia Bakeries? AGE

FREQUENCY

PERCENT

Strongly Agree Agree Neutral Disagree Strongly Disagree TOTAL

16 13 2 0 0 76

52% 42% 6% 0% 0% 100%

Table 16 (See Appendix for chart presentation) The researchers conclude that most of the respondents prefer Ham and Cheese flavoured Sandwich. Table 17. Monthly Income AGE

FREQUENCY

PERCENT

below P 5,000 P 5001 - P 15,000 P 15, 001- P 25,000 P 25,001- P 35,000 P 35, 001- P 50, 000 P 50, 001- P 100, 000

15 5 5 5 1 1

48% 16% 16% 3% 10% 3%

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P 100, 000 and up TOTAL

1 33

3% 100%

Table 17 (See Appendix for chart presentation) The researchers conclude that most of the respondents prefer Ham and Cheese flavoured Sandwich. E. COMPETITOR ANALYSIS a. Competitor Profile COMPANY

MISTER PULLMAN

COMPANY PROFILE

MISSION AND VISION

Established in 1985, Mister Pullman began as a provider of fresh, high-quality bakery products at affordable prices in the Metro Manila area. With initial manufacturing facilities and a small work force, it expanded its business through the installation of state-of-the-art machinery and systems from the best bakery equipment suppliers from Japan, North America, China, and Taiwan making its plant a technology-driven production site aimed at leading continuous improvement. Consequently, it continues to satisfy customer needs by providing quality goods and excellent service.

Information Not Available

Today, Mister Pullman has become one of the leading brands of bread and pastries in the country and is now available in thousands of supermarkets and bakeries. Its daily production has exceeded 10 tons of flour. Mister Pullman offers a wide range of superior bakery products including its classic white bread, customer-loved mongo bread, butter loaf, cheese bread, and Page 24

tasty pastries like mammon, ensaymada, cup cake, brownies, hopia, and many more. Mister Pullman breads are known for their good taste, freshness, softness, oven-baked aroma and reasonable prices. Many of its products are cholesterol free and bromate free, have zero transfat, and are vitamin fortified, which are a good part of a healthy diet. Its product slogan "Cant forget the great taste" best describes the product benefits. As a result of the greatness of its products, the company has won the National Shoppers Choice Award and the Philippine Marketing Excellence Award for three consecutive years.

MARBY FOOD VENTURES

Established 1976, Marby Food Ventures, a Filipino owned company and among the pioneers of the trade, carries various baked products viewed as the benchmark of quality by the bakery industry. Since its inception in the 70's, Marby's bakery products have been a household name, providing each family with bread and pastries that are highly affordable and available. Its increasing demand prompted the company to make the product accessible to its market through widespread distribution and unique selling techniques. At a time when breads were sold in the bakery and sari-sari stores (Filipino small scale convenience stores) along residential areas, Marby proprietors decided to come up with a modern and more flexible marketing strategydelivery service. Long before this innovative system became popular, Marby started its own delivery scheme that reached consumers regardless of proximity. With its effective Page 25

From the company's conception, Marby Food Ventures has embarked on a mission of providing unparalleled service. With its slogan "Quality Baking Traditions", motivated by its quest for excellence, Marby has pledged to carry on its tradition of ensuring utmost satisfaction through continuous guiding principles of improvement and dynamism to build trust and confidence with its valuable clientele. As the 3rd millennium goes full swing, Marby Food Ventures envisions to be the largest manufacturer and distributor of high quality baked products, as well as

distribution system, Marby was catapulted to being one of the industry's leading manufacturers and distributors in the market. And in no time, Marby became a household name. From a small proprietorship, it has grown into one of the leading bread manufacturing companies in the Philippines.To ensure its customers of continuous product innovations, Marby has been in partnership with several market research firms to recognize the behaviors of consumers and today's trends.

providing a vast range of food products for the retail market. Its high rate of production will be backed by sophisticated, high-technology bakery machines, skilled manpower, an efficient distribution system, and facilities which will ensure the quickest and easiest access to even the most remote region of the country and the rest of the global market.

Today and for many years, Marby holds the over all market leadership in baked product manufacturing and distribution serving more than 2000 outlets in GMA and Luzon. Consequently, by virtue of its daily output, Marby is considered as one of the major consumers of bakery ingredients. Its overall production comes from a massive manufacturing plant in Bulacan, operating 24 hours daily to produce over a hundred varieties of bread, pastries and biscuits that Marby is currently known for.

Galactica Food Corporation has been in the GALACTICA bakery business for 34 years now. Since it’s FOOD establishment in 1979, the owner Mr. Lam A. CORP. (PAN- Santos has set a goal of serving the Filipino A-CUP) people with baked goods that are reasonably proced but exceptionally high in quality and in taste. Though Mr. Lam is a Half Filipino and Half Chinese in Blood, he being born here in the Philippines, already gave him the edge on what the Filipino Taste buds would prefer in terms of baked goods. Pan A Cup, our brand name was first known for the primary product the “Pullman bread”. The Page 26

This Filipino owned corporation hopes to maintain the high quality and goodness of its low-processed baked products that its loyal customers have enjoyed. Through the years, Pan-A-Cup bakeshop firmly believes it’s customers deserve only the best and we will continue to exist under the principle of pur logo “Basta Pan-A-Cup masarap”.

bread has a very distinct taste, which to our opinion still compares to none in the market. We boast not only of quality and taste of our bread line selection, but now we have over 30 varieties of pastry goods selling in the market. For more than two and a half decades now, pan-a-cup have been doing business with top supermarkets in the metropolis area and now even with chains of convenience store in Metro Manila and surrounding provinces.

B. Competing Product Features COMPANY

MISTER PULLMAN

MARBY FOOD VENTURES

GALACTICA FOOD CORP. (PAN-A-CUP)

PRODUCT FEATURES good taste freshness softness oven-baked aroma and reasonable prices Superior quality products Innovative Good taste Wide range of variety

Distinct taste Wide range of variety Good quality Low processed baked products

C. Target Market Selection

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Mister Pullman- Mister Pullman aims to target bread lovers with its product offerings. It caters

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to target moms and young adults and students who are looking for easy to go snacks. Marby Food Ventures- With its variety of flavors and products, Marby aims to target family, moms, also students and young professional to be their preferred snack. They also target those who are looking for healthy breads and products.

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Galactica Food Corp. (Pan-A-Cup)- Pan-A-Cup with it’s innovative and healthy product line aims to target young professionals and students who are looking for snack alternatives which is healthy and affordable.

D. Positioning Strategy COMPANY

TAGLINE

POSITIONING STRATEGY

MISTER PULLMAN

"Can’t forget the great taste"

Mister Pullman positions itself to be the bread that you will never forget, the bread that you can always remember because of it’s good taste, freshness, softness and oven-baked aroma.

MARBY FOOD VENTURES

"Quality Baking Traditions"

Marby Food Ventures positions itself to be the superior quality of bread in terms of baking process. They want to be remembered as the company that is known for quality baking.

PAN-A-CUP

“Basta Pan-A-Cup masarap”

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Pan-A-Cup positions itself to be the bread that has distinct taste and the bread that customers will immediately consider because of it’s deliciousness.

E. Marketing Mix Strategies

COMPANY

PRODUCT

PLACE

PRICE

PROMOTION

MISTER

Wide range of

Availability in

Reasonable price

Use of website

PULLMAN

variety products

leading

Use of Facebook

supermarkets and

fan page

grocery stores.

MARBY

Wide range of

Availability in

variety products

leading

FOOD VENTURES

Affordable price

Use of website

Affordable price

Use of website

supermarkets, Produces healthy

grocery stores,

Products

convenience stores and drug stores.

PAN- A-

Wide range of

Availability in

CUP

variety products

leading supermarkets and

Produces healthy

grocery stores.

Products

Page 29

Differential Advantage Analysis WEIGHT GARDENIA

Key

SCORE MARBY SCORE PAN-

SCORE Mister

SCORE

A-

Pullma n 0.6

6

0.6

2.8

7

2.8

.10

7

.70

5

0.5

CUP 6

.40

9

3.6

7

2.8

7

Industry Success Factors Extensive distributio n

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Customer

.20

8

1.6

6

1.2

7

1.4

7

1.4

.10

7

.70

6

0.6

6

0.6

6

0.6

.20

9

1.8

8

1.6

8

1.6

7

1.4

focus Economies of scale Product Innovation TOTAL

1.0

8.4

6.7

7

Market Target (s) Description Primary Market The primary target market of Gardenia Bakeries is Generation X from ages 33-53 years old and Generation Y from ages 25-32 years old of Class B and C with ₱15,000 and above income, mostly mothers who are regular or occasional users of bread and who highly value the freshness, taste, and nutritional content of the product. They are devoted to their family so they value work-life balance. They easily adapt to change and practice healthy lifestyle. Secondary Market Page 31

6.8

The secondary target market of Gardenia Bakeries is composed of the children, students, and young professionals. They are the ones who have great influence on the primary market’s buying decisions. The children ages 4-11 years old who are exposed in various have significant influence over family purchases. Students who look and spend for quality, convenient, and ready to eat products is also part of Gardenia’s secondary market since Gardenia breads were made available in several school canteens. Young professionals who also seek for instant yet healthy products are also a target market for Gardenia. Objectives    

To acquire significant share in the new target market To increase market share by 5 % over the next two years To increase demand for Gardenia products To expand its channel distribution in other parts of the Philippines and other countries in Asia

Marketing Program Positioning Strategy The management wants the brand Gardenia to be positioned and associated with the qualities of freshness, good taste, and uniqueness. It also wants the brand to be associated with a diverse product line and ready-to-eat products. It wants to be positioned in the minds of the consumers as the top, growing brand of bread company. Marketing Mix Strategy A. Product Strategy Gardenia Bakeries Philippines should continue innovating by producing new products and product lines that will cater larger market needs and preferences. The company should continue producing quality, fresh, tasty, nutritious, and instant products to maintain loyal customers and gain more Page 32

customers. They should also adapt to changes by improving their products’ packaging design and offering new flavors that will suit the market’s needs and preferences. According to the survey conducted with 31 respondents (See Appendix), the suggested new products/product lines for Gardenia are; Gardenia-to-go (ready to eat sandwiches), Biscuits, Cookies, Mamons, Ensaymadas and Gardenia spreads, jams & marmalade are the new products Gardenia Bakeries could produce to increase demand and market share. Here are the lists of the new products with its descriptions: 

Gardenia-to-go (ready to eat sandwiches)- Tuna, Bacon and Egg, Ham and Cheese, TLC



(Tomato, Lettuce and Cheese), Chicken sandwiches Biscuits- Healthy biscuits with dip of different flavors (Chocolate, Strawberry, Vanilla, Ube-

   

Cheese), biscuits with fillings of different flavors (Chocolate, Strawberry, Vanilla, Ube-Cheese) Cookies- Sugar-free/Wheat Cookies for health conscious customers Mamons & Ensaymadas- Fluffy Mamons and Cheesy Ensaymadas Gardnenia Spreads- Choco Hazelnut, Choco, Ham, Chicken, Peanut Butter, Tuna Spreads Gardenia Jams & Marmalades- Blueberry, Strawberry, Coconut, Pineapple, Mango

Gardenia should also improve its packaging to attract more customers and ensure the quality of its products. The suggested packagings according to the survey are; Zip-Lock pack, Box-form (Travelpack, Picnic-pack, etc), Zip-Lock pack, and Mini-size Sandwich. B. Distribution Strategy Since the start of Gardenia’s operations, its distribution had grown rapidly. Gardenia is now considered as the most widely distributed loaf brand in Metro Manila and other parts of the Philippines such as Isabela, Abra, Cagayan, and Ilocos provinces in North, Bicol and Sorsogon in the South, and Negros Samar, Antique, Iloilo, and Leyte in Visayas region and other parts of Mindanao. Page 33

Manufacturer – Wholesaler – Retailer –Consumer Manufacturer- Gardenia should continue using hi-tech and advanced machineries and equipments in producing their products. Gardenia uses the traditional American Sponge and Dough bread-making method to bake soft-textured loaf with a tender crust and distinct taste. This unique method ensures that Gardenia's bread stays fresh longer and tastes so good you can even eat it on its own. Gardenia should enhance and expand its manufacturing facilities to produce more high quality, tasty, and fresh breads to be distributed and offered to its customers. Wholesaler- Gardenia pioneered a unique distribution system, ensuring that only fresh breads reach customers every day. Gardenia should continue its international policy of keeping only fresh stocks on the store shelves. Delivery vans leave the production plant as early as 4 o’clock in the morning to distribute the products in specific locations nationwide as soon as it is produce from the factory. Gardenia Philippines always replace unsold breads with their freshly baked premium quality breads and other products. This is to earn wholesalers’ trust that their products are of good quality and will be patronized by sellers and customers. Gardenia’s wholesalers should improve its marketing strategies through different promotional strategies such as offering product bundles, discounts, and coupons, to attract retailers and other sellers to offer the products to several customers. Retailers- Gardenia should maintain its good relationship with the retailers offering their products by following their rules and regulations and offering them good deals and benefits to have a good position in their stores. Gardenia should provide evidences that will ensure that their products will be bought by several customers. Page 34

Retailers such as supermarkets, hypermarkets, convenience stores, bakeries and other retail stores selling Gardenia products should improve its services and its store atmosphere to satisfy its customers and make them buy their products. They should also conduct different promotions such as buy 1 take 1, product bundles, discounts, patronage reward such as coupons, raffle tickets, etc. to remain loyal customers and gain new customers. Gardenia Stand-Alone Stores- Gardenia should build stand-alone stores that will offer all their products to several customers. Since one of the qualities customers are looking for a product is its availability and convenience in buying it, Gardenia should make its products widely available in locations convenient and accessible for their customers. Kiosks should be placed in MRT stations, bus stations, and other locations where customers usually look for ready to eat products. C. Price Strategy Maintain premium pricing for Gardenia - It used to maximize profit in areas where the customers of gardenia are happy to pay more, where there are no substitute for the product, where there are barriers to entering the market or when the seller cannot save on costs by producing at a high volume. D. Promotions Strategy Gardenia should build brand preference among C and D market while strengthening hold of the A B market through high impact advertising and promotions. Gardenia will maximize the use of online and online advertising. Integrated Marketing Communications (Promotion) Strategy

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•

Integrated Creative Message Strategy

- ‘So good… you can even eat it on its own’ or ‘masarap kahit walang palaman’ •

Advertising

•

Sales and Promotional

- Tie up some events and festivals. •

Publicity/pr

- Conduct a survey “house to house” to reach house wives/house people and introduce their products, give sample and collect feedback. •

Digital Marketing

- Gardenia Bakeries will use push/pull digital marketing. •

Collaborate general knowledge quizbee competitions on highschool campuses and product

innovation contest on universities IMC OBJECTIVES Gardenia Bakeries’ objective should be expansionary, given its current standing in the market. A market leader can maintain, grow and prospect its position in the market by employing strategies focused on the following: a. b. c. d. e.

To acquire loyal customers. To encourage more frequent usage form consumers. To find new uses of product. To increase sales. To establish Brand Recall. Page 36

BUDGET Print Advertisements (leaflets, tarpaulins etc) - Leaflets will contain the basic facts such as price, appearance and basic nutrient contents. This is intended to be distributed to the public markets and stores during the launching of the products. Tarpaulins will contain the layout of the leaflets and to be posted on the distributing places of the products all over the Philippines. Php 50,000.00 Media Advertisements (Radio and TV) - An effective attention getting advertisement will be aired on the different channels of media. Php 1,000,000.00 Commissions - It will be given to stores and distribution channels that sell the product. A 15% of the sales will be given to the distributors. Php 2,250,000.00 Purchase Discounts - It will be given to the customers that will be purchase the 10 pieces packs of the product during peak seasons such as Christmas sale. A 20% discount on purchase price will be given. Php 3,000,000.00 Free Taste - This will be done during the launching of the product. Samples of the product will be distributed to the customers through the product stall in different distribution channels nationwide. Php 65,000.00 Php 15,000,000.00 (estimated sales related to pan de sal per year) Marketing Implementation A. Structural (Internal) Team buildings in the company and in the factory will enhance the capabilities and strengthens the power of work force in the company of Gardenia bakeries. Page 37

Time to time inspecting of machines in the factory would help to avoid malfunction of machineries. Gardenia could do marketing programs like giving rewards to the employees that will make them motivated and inspired to their work. B. Tactical Marketing Activities Specific Tactical Activities Product Activities Launch the new Gardenia products: Gardenia Spreads Gardenia Jams and Marmalade Gardenia Ready-ToGo Sandwiches Gardenia Cream Filled Biscuits Gardenia Filipino Biscuits Gardenia Mamon and Ensaymadas Pricing Activities Christmas Package Basket (Consumers can buy Christmas basket filled by Gardenia products, this basket may serve as their Christmas gift) Bundle Promo (Bundle promo is suggested to help consumers save) Pasalubong Bundle Pasalubong bundle is

Person/Department Responsible

Required Budget

Completion Dates

Marketing Department

31, 500, 000

January 2014December 2014

10,500,000

March 2014December 2014

Operations Department Finance Department

Marketing Department Operations Department Finance Department

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March 2015December 2015

also created to help the consumers save by buying in bulk than by piece.) Discount Coupons Distribution/Supply Chain Activities Stand Alone Stalls Food Kiosks - All kiosks and stalls would be placed on more foot traffic areas and where people are always on the go like MRT and LRT stations, schools and universities and other transport stations. IMC (Promotion Activities) 1.Launch Gardenia Bread Apps for Kids - Gardenia would launch apps that would be very interactive to children and definitely an educational one. 2. General Knowledge Quizbee on Highschool Campuses - this is to promote education and to create brand awareness and

Marketing Department Operations Department

21,000,000

January 2014March 2014

Finance Department

Marketing Department Finance Department

Page 39

January 2014December 2016

recall 3. Product Innovation Challenge and Search for the new Gardenia flavors competition on top performing universities - collaboration on universities would be held for product innovation specifically on marketing students and search for the new flavors competition that would target HRM and culinary students. 4. Launch new interactive website - Website would be more fun and interactive, blogs would be posted that would advise consumers regarding healthy living. 5. Gardenia Photo Contest - Gardenia will look for the best family photo promoting family bonding while enjoying Gardenia products. 6. Gardenia Give Love on Christmas Day - Consumers would be highly encourage to be part of the Gardenia Outreach program that would benefit Page 40

homeless families. 7. Use of the Traditional Media - placements of ads on magazines and newspaper, placing ads on radio and TV to increase brand awareness and recall. 8. Maximize the use of Social Media - Gardenia will use social media to hype the market about Gardenia’s new products and will use contests and games on the following social media platforms like Twitter, Instagram and Facebook. 9. Support Fun Run and Sports Clinic. 10. Conduct Baking Workshop Activity during Summer for Kids.

Monitoring and controls A. Marketing metrics Product-Based Metrics  Customers  Customer feedback through surveys  Customer feedback through social media accounts and website  Measuring the size of the market through referrals, word of mouth and awareness Page 41

 

 

Quality of Product  Through customer’s comments and suggestions  Through number of sold to customers Sales Volume  Conducting sales report on a weekly, monthly, quarterly and whole year basis for the advertising media, events and sponsorships. Market Share  Conducting research on market share information  Collecting data from Primary and Secondary data Marketing Programs  Evaluation of market program implementation  Measuring effectiveness of strategies  Feedback from the customers  Conduct marketing audits

2. Secondary data The company could collect secondary data from:        

Local Newspaper Annual reports Customer communication Government Industry research and survey General business publications Social networking sites News releases

3. Primary Data      

Customers Employees Consultants Suppliers Salesforce Survey Page 42

FORECASTS AND BUDGET 3 years (2011-2013 (weighted moving average)) YEAR 2011 2012 2013

INCOME 2,000,000,000 2,500,000,000 3,500,000,000

WEIGHT .2 .3 .5

RESULT Php 400,000,000 Php 750,000,000 Php 1,750,000,000

BUDGET 3,500,000,000 x .03= 105,000,000 ALLOTED BUDGET for 3 years ACTIVITY/PROGRAM Creation of New Products Pricing Activities Traditional Media (Print, Radio and

BUDGET 31, 500, 000= 30% 10,500,000= 10% 21,000,000= 20%

Television Ads) Distribution/Supply Chain Activities Other IMC (Promotion Activities) Contingencies TOTAL

21,000,000= 20% 15,750,000= 15% 5,250,000= 5% Php 105,000,000

SOURCES: http://www.ohiodominican.edu/uploadedFiles/Library/CoursePages/Courses/Bus/Bus498/SWOT %20Matrix%20and%20Organizational%20Strategic%20Plan%20Paper.pdf http://www.uniassignment.com/essay-samples/management/management-in-the-food-processingindustry-management-essay.php#ftn9

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http://www.euromonitor.com/baked-goods-in-the-philippines/report http://pana.com.ph/gardenia-is-happy-to-be-part-of-the-filipino-household-for-15-deliciousyears/ http://gohsookching0307949.blogspot.com/2013_06_01_archive.html http://www.misterpullman.com/#!pastries http://www.marbyfoodventures.com.ph/MarbyProducts.html http://panacup.wix.com/panacup#!about_us/c1se

APPENDIX Survey Online Question

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SURVEY RESULTS CHART PRESENTATION

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SAMPLE NEW PRODUCTS

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