Market Analysis

John Arsenio G. Barrion Jethro B. Capino

I.

Product In modern times, people are always in a hurry, going to work or school and have no enough time for a heavy bountiful breakfast so they result in cereals. But cereals can’t live   without milk, ready-to-drink milk in carton to the rescue. People have been enjoying the convenience milk carton brought back in 1906 and still continue to date.

II.

Brands, Serving, and Manufacturer

Brand

 Alaska Fresh Milk  Alaska Hicalcium Non-fat Milk  Alaska SLIM Low Fat Milk Bear Brand Sterilized Full Cream Cowhead Lite Milk Cowhead Pure Milk Cowhead Pure Milk Omega-3 enriched Cowhead Low Fat Milk Cowhead Lactose-free Pure Milk Cowhead Pure Milk Fat-free Harvey Fresh Full Cream Milk Harvey Fresh Lite Milk Harvey Fresh Skim Milk Harvey Fresh Lactose-free Fresh Milk Harvey Fresh

Serving

Manufacturer Manufactur er

250mL

Alaska Corporation Alaska Corporation

Price (PhP)

Est. Price per Serving (PhP)

Milk 69.50

17.38

Milk 69.50

17.38 17.13

200mL

Alaska Milk 68.50 Corporation Nestle Philippines 79.50

15.90

250mL

QAF Limited

79.50

19.88

250mL

QAF Limited

74.50

18.63

200mL

QAF Limited

79.50

15.90

200mL

QAF Limited

79.50

15.90

200mL

QAF Limited

86.50

17.30

250mL

QAF Limited

79.50

19.88

250mL

Sermasison Corporation Sermasison Corporation Sermasison Corporation Sermasison Corporation

64.50

16.13

67.50

16.88

67.50

16.88

114.50

28.63

114.50

28.63

250mL 250mL

250mL 250mL 250mL 250mL

Sermasison

John Arsenio G. Barrion Jethro B. Capino Lactose-free Skim Milk Jolly Cow Fresh Milk Jolly Cow Nonfat Milk Magnolia Pure Fresh Magnolia Pure Fresh Low Fat Magnolia Full Cream Milk Milk Magic Full Cream Milk

Corporation 200mL

Fly Ace Corporation

68.50

13.70

200mL

Fly Ace Corporation

71.50

14.30

250mL

Magnolia Incorporated

72.50

250mL

Magnolia Incorporated

76.50

250mL

Magnolia Incorporated

74.50

27.50 (based on the 250mL variety) 30.00 (based on the 250mL variety) 18.63

250mL

69.50

22.50 (based on the 250mL variety)

69.50

17.38

59.50

14.88

250mL

Consolidated Dairy and Frozen Food Corporation Consolidated Dairy and Frozen Food Corporation Consolidated Dairy and Frozen Food Corporation Nestle Philippines

72.50

18.13

250mL

Nestle Philippines

79.50

250mL

RFM Corporation

60.00

30.00 (based on the 250mL variety) 15.00

250mL

RFM Corporation

69.50

21.50 (based on the 250mL variety)

250mL

RFM Corporation

69.50

17.38

Milk Magic Low 250mL Fat Milk Milk Magic Sterilized Filled Milk Nestle Fresh Milk Nestle Non-fat Milk Selecta Fortified Milk Selecta Low Fat Fortified Milk Selecta Full Cream Milk

III.

250mL

History A. Alaska Milk Corporation

 Alaska is a milk brand that's originally from the Netherlands. For many years, Alaska products were imported into the country. But in 1972, Alaska Milk Corporation decided to produce one product locally  – the evaporated filled milk. Eventually, they proceeded to manufacture other products in the local plant. But all throughout, quality has always been the brand's topmost priority. It is assured in every pack of Alaska. Beyond its products, Alaska also provides emotional benefits to its consumers. It is caring, trustworthy and good for the whole family. Then and now, the brand has always stood for health and nutrition. This is encapsulated in the

John Arsenio G. Barrion Jethro B. Capino brand line “Sa sustansya't lasa wala pa ring tatalo sa Alaska”. Aside from being

tasty and nutritious, Alaska is also highly affordable. No wonder millions have made Alaska milk products part of their daily life. Then with the creation of the Alaska Aces, the company's basketball team, the brand has become highly associated with sports. This helped create an image of a healthy, active and sports-oriented lifestyle for the brand. But in the heart of consumers, the picture of a healthy and happy boy on the pack is still the most well-known brand symbol. It embodies what Alaska is all about and the role it plays in the lives of consumers.  Alaska guarantees its customers that all products are made with the best ingredients and delivered to the market in top quality. Alaska has a new seal of quality signifying a renewed vigor in providing its customers with the best and freshest products. B. Magnolia Incorporated

Magnolia started in 1981 as a business unit of San Miguel Corporation's Magnolia Ice Cream Division. It entered into a joint venture with New Zealand Dairy Board (NZDB) in 1987; named as Philippine Dairy Products Corporation (PDPC); SMC owning 70% until in July 2002 buying out NZDB share and became Magnolia Incorporated, a subsidiary of San Miguel Pure Foods Company. Magnolia in its 5-hectare Plant facility in General Trias, Cavite diversified from Butter, Margarine and Cheese into one of the top manufacturers of Dairy, Fats and Oils in the Philippines with its new product line jelly, jams, UHT milk, specialty oils, salad aids and cookingoil. Magnolia is the first dairy company certified by the International Standard Organization ISO 22000:2005 and recently awarded the ISO 9001:2008 certification. SGS Philippines Inc. also granted Magnolia HACCP and GMP certifications. Magnolia also received HALAL product certifications from Islamic Daiwah Council of the Philippines - IDCP. Magnolia guarantees to continuously provide quality foods that nourish generations through its adherance to utmost control of food safety and quality management C. RFM Corporation

RFM Corporation was originally incorporated in 1967 as Republic Flour Mills, Inc. to manufacture flour in the Philippines despite wheat not being grown in the Philippines. Its founders include Salvador Araneta, Jose

John Arsenio G. Barrion Jethro B. Capino Conception, Sr., BJ Server, Albino SyCip, Zoilo Alberto, Leonardo Eugenio, Francisco Gamboa. The venture proved to be a success despite critics saying it was impossible. It ventured into bakeshop business and food franchising with the acquisition of Rollin Pin trademark and, Dairy Queen and Lit tle Caesar’s Pizza brand. Both franchises were under the Asia Food Franchsing Corporation formed by RFM in 1996. However, despite the massive expansion RFM is undertaking, the Asian Financial Crisis put a stop on it. With a looming bond of USD83 million, RFM was forced to sell Cosmos to San Miguel Corporation. To date, among the branded food products RFM operates are Swift processed chilled and canned meats like hotdogs, vienna sausage, and corned beef, Sunkist Juices, Selecta Milk, Fiesta Pasta Noodles, White King Hot Cake, and Butterfresh Margarine. D. Nestle Philippines

 Although Nestlé products were already available in the Philippines as far back as 1895, it was not until 1911 when The Nestlé and Anglo Swiss Condensed Milk Company was established in the country, with its first sales office in Calle Renta, Binondo. The Company was forced to suspend its operations during World War II, but soon made a comeback after Liberation, under a new name: Filipro, Inc. It continued to import products such as MILO, NIDO powder milk, MILKMAID and NESCAFÉ from other countries. In the early 1950’s, Filipro encountered difficulties when the Philippine government imposed import control. Due to lack of imported products to sell, it was forced to become a distributor of peanut butter, napkins, fruit preserves, and patis (fish sauce)  just to keep its operations going. E. Fly Ace Corporation

In 1972 Lucio Cochanco, Sr., and Ederlina Cochanco, began a family legacy by setting up Jolly General Merchandise. After starting out as a retailer of agricultural products such as rice, sugar and cooking oil, Jolly General Merchandise evolved to include trading of imported grocery items in the early 80's Despite a backdrop of economic crisis that shook the country, Lucio steered the company to achieve steady growth that led to the incorporation of Fly Ace Corporation in 1993. At present, Fly Ace offers a wide variety of high quality products sourced from trusted partners all across the globe. It was in 1997 that Fly Ace ventured into private labeling under the Jolly brand, from canned fruits to cooking enhancers.

John Arsenio G. Barrion Jethro B. Capino This was followed by several other private labels to include Jolly Cow Fresh Milk, Good Life Oriental condiments and Doña Elena, which brings out the best of Olive Oils, anchovies and sardines to the local market. The company exclusively distributes high-grade products that have become part of the Filipino household. Indeed, Fly Ace has come a long way from its humble beginnings to what it is today one of the country's leading importer-distributors of high quality consumer products. Sustaining the operations and growth of the family legacy is now a challenge undertaken by the Cochanco children. Now headed by Lucio Cochanco, Jr., Fly Ace Corporation is at the forefront of the importing and distributing trade. The company now enjoys a significant share of the imported goods market, catering to all major supermarkets, wholesale clubs, wholesalers and food service customers nationwide. Family kinship, value for money, hard work, and the commitment to bring the best of the world at reasonable prices  – these are the driving forces that pushed Fly Ace Corporation to become a leader in its industry today. Now with over 30 years of combined experience in the venture, Fly  Ace has established solid foundations, cultivated growth, strengthened relationships, forged friendships and built a reputation that allows for its development. These milestones set the stage for a prosperous future as Fly  Ace continues to soar to greater heights. F. Consolidated Dairy and Frozen Food Corporation

 A company that started through trading sugar and rice in the 1940s, Consolidated Dairy and Frozen Food Corporation, grew to become one of the leading wholesalers and distributor of processed foods in the Philippines. Under the current leadership, the company expanded their product lines from milk powders to retailing their own brand of UHT milk and from frozen potatoes to other frozen food products. There are two divisions in Consolidated Dairy, the industrial and food service division, which caters to the manufacturing, food service and hospitality industry, and the consumer based division, which distributes retail products to supermarkets and grocery stores. Consolidated Dairy is still on its way to expanding its operations as well as line of products in the coming years. Included in the top 1000 corporations, the management is still continually looking for ways to better their operations and look for other principals from other countries to add to their existing product portfolio.

John Arsenio G. Barrion Jethro B. Capino Consolidated Dairy is ranked 786 in the year 2011 among the country's top 1000 corporations. The corporation recently completed their new Sucat distribution center with a cold storage capacity of 5000 MT. G. QAF Limited

They were formerly known as Ben & Company, a sole proprietorship established in the 1950s, carrying on the business of food trading and distribution. In March 1958, we were incorporated as a private limited company. In August 1967, Ben and Company Limited was listed on the Singapore Stock Exchange, and by the 1970's we had become one of the largest food importers and distributors in Singapore and Malaysia. In October 1984, we changed our name to QAF Limited. Today, our traditional food trading and distribution business remains one of our core businesses and we are a leading importer and distributor of a wide range of international food brands. In August 2004, we acquired a 305-hectare dairy farm in Victoria,  Australia. This was followed by the acquisition of a second farm of 418 hectares in the same area in March 2005. H. Sermasison Corporation

The Siy Family, led by the matriarch Dominga Siy, has been practicing these since it started a wholesale textile business in Binondo. After 40 years of operations, the Siy Family decided to diversify into a complementary business -- food. Sermasison Corporation has a nationwide distribution network covering Luzon, Visayas and Mindanao, Sermasison Corporation services a wide range of distribution channels from supermarkets, convenience stores and groceries to hotels, restaurants, specialty shops, hospitals, bakeshops, pet shops and coffee shops. Manufacturers who partner with Sermasison to bring their products into the Philippines know that Sermasison gives special attention to each and every product it takes on. Sermasison is a brand builder with a unique eye for quality, value-conscious products. Sermasison Corporation is already a major player in its product categories and enjoys a sizable share in the imported food market. Sermasison Corporation looks forward to the future of making lives

John Arsenio G. Barrion Jethro B. Capino even better by making available to Philippine consumers the best foods the world has to offer!

IV. Process Cows’ milk is sucked from the

teats by a breast pump to a tank.

Tanks are then transported to the nearest processing plant.

The Tanker is tested again in a laboratory to ensure that it has been kept at or below 4 degrees Celsius during transport, and delivered within 24 hours of milking

The tests also monitor protein levels and check for the presence of bacteria and antibiotics.

 After testing, the milk is pumped into insulated vats (liquid storage) at the factory.

 At the factory, milk is sent through a processing line to be packaged in cartons that are made from cardboard lined with a polyethylene plastic.

John Arsenio G. Barrion Jethro B. Capino Once the correct amount of milk has been put in, the carton is heat sealed, stamped with the use-by date and packaged in milk crates which are stored in a huge cool room until the are collected from the factor .

V.

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John Arsenio G. Barrion Jethro B. Capino

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John Arsenio G. Barrion Jethro B. Capino

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John Arsenio G. Barrion Jethro B. Capino

VI. Share Price, Market Capitalization, and Structure Market Capitalization

1. 2. 3. 4. 5. 6. 7. 8.

Alaska Milk Corporation  – 11.9 Billion Philippine Pesos Magnolia Incorporated  – 2.16 Million US Dollars RFM Corporation  – 5.4 Billion Philippine Pesos Fly Ace Corporation  – n/a Nestle – 233 Billion US Dollars Consolidated Dairy and Frozen Food Corporation  – n/a QAF Limited  – 488 Million US Dollars Sermasison Corporation  – n/a

Share

1. 2. 3. 4. 5. 6. 7. 8.

Alaska Milk Corporation  – 13.50 Philippine Pesos Magnolia Incorporated  – n/a RFM Corporation  – 1.69 Philippine Pesos Fly Ace Corporation  – n/a Nestle – 100 Philippines Pesos Consolidated Dairy and Frozen Food Corporation  – n/a QAF Limited  – n/a Sermasison Corporation  – n/a

Structure

The structure of the milk industry in the Philippines is a monopolistic competition; there are numerous manufacturers having each a small share of the market. VII. References History Alaska Milk Corporation

http://www.alaskamilk.com/v2/advertising/&usg=ALkJrhhgWoQ4Qao2N1v0PB8StfnnraWaq  A Magnolia Incorporated

http://www.magnolia.com.ph/about.php RFM Corporation

http://en.wikipedia.org/wiki/RFM_Corporation Fly Ace Corporation

http://www.flyacecorp.com/history.html Nestle Philippines

http://www.nestle.com.ph/aboutus/history Consolidated Dairy and Frozen Food Corporation

http://www.consolidateddairy.com/about.php QAF Limited

http://www.qaf.com.sg/aboutus/history.asp#history

John Arsenio G. Barrion Jethro B. Capino Sermasison Corporation

http://www.sermasison.com/about.php