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Chapter 2

Marketing Feasibility
This aspect involves the product description and target market of Soyammy, as
well as the demand-supply analysis, factors affecting the market, price study and its
marketing programs and strategies.
Product Description
Soymilk is a pleasant sweetish and nutritious beverage of white or creamy color
with a slight pleasant smell. In this study, the soymilk was innovated to give different
taste of the soymilk people were used to drink; the product will be SOYAMMY, which
will be offered with different flavours like strawberry, pandan, melon and chocolate.
Since consumers were used to the refreshments offered in the market having tapioca
pearl, the researchers adopted it.
Target Market
In this study, in order to identify the target market of the proposed business, the
researchers used stratified quota sampling. In the application of which, the target market
of the business will be the students of Colegio de Dagupan, of all levels, as well as the
nearby community of the location.

Demand Analysis

There are many factors to know and consider in determining the demand. In this
study, the researchers used survey questionnaire to analyse and get the demand.
Table 2.1 Behaviour of Respondents
Behaviour of Respondents
Gender
- Male
- Female
Are you aware of the different kinds of shake?
- Yes
- No
What particular shake do you buy?
- Coffee shake
- Fruit shake
- Vegetable shake
- Chocolate and Vanilla shake
- Chocolate and Fruit shake
- Coffee, Chocolate and Vanilla shake
- Fruit, Chocolate and Vanilla
- All
How often do you buy shake?
- Twice a day
- Once a day
- Thrice a week
- Twice a week
- Once a week
Where do you buy it?
- Food Carts
- Restaurant
- Fast Foods
- Food Carts and Restaurant
- Food Carts and Fast Food
- Restaurant and Fast Food
- All

F(150)

50
100

33.3
67.7

138
12

92
8

14
42
3
55
2
6
17
11

9.3
28.0
2.0
36.7
1.3
4. 0
11.3
7.3

14
27
14
26
69

9.3
18.0
9.3
17.3
46.0

69
25
27
10
6
8
5

46.0
16.7
18.0
6.7
4.0
5.3
3.3

How much do you pay for it?


- P100 above
- 100 70
- 70 50
- 50 30
- 30 below

17
13
29
59
26

11.3
8.7
19.3
39.3
17.3

Profile of respondents. The table above shows the characteristics of the


respondents in terms of their consumption of different shakes offered in the market. Part
of the survey was the profile of the respondents. As to the profile of the respondents, the
researchers asked their age, gender and daily allowance. In terms of age, the computed
mean age of the respondents is 19.20. When it comes to the gender of the respondents, a
great majority or 67.7% are females and many or 33.3% are males. Lastly, the computed
mean for the daily allowance of the respondents is 1.71.
Respondents awareness about different shakes. Table 2.1 shows the
respondents behaviour in the consumption of the different shakes already existing in the
market. When it comes to the awareness of the respondents about the different kinds of
shakes, almost all or 92% are aware and very few or 8% are not.
Particular shakes the respondents buy. When asked if what particular shakes
the respondents buy, chocolate and vanilla shakes garnered the highest percentage which
is 36.7%, followed by the fruit shake with a percentage of 28.

Frequency of respondents in buying shakes. As shown above, almost half or


46% of the respondents buy shakes once a week. On the other hand, very few or 9.3%
buys shakes twice a day and thrice a week.
Store/ business lay-outs where respondents purchase shakes. When asked if
where the respondents buy shakes, almost half or 46% purchase on food carts, followed
by fast foods which earned 18% from the respondents.
Price of shakes the respondents spend. As to the price the respondents spend to
purchase shakes, almost half or 39.3% of the respondents spend 50-30 pesos to avail
one. On the other hand, very few or 8.7% spend 100-70 pesos in purchasing shakes.
Table 2.2 Behaviour of Respondents to Try Soyammy
Behaviour of Respondents to Try Soyammy
Do you drink soy milk?
- Yes
- No
Are you willing to try soy milk shake
with different flavours?
- Yes
- No
What vegetables do you prefer for your salad?
(you can choose more than 1)
- Vanilla
- Chocolate and Melon
- Chocolate and Strawberry
- Chocolate and Coffee
- Chocolate and Pandan
- Melon And Strawberry
- Melon and Coffee
- Chocolate
- Strawberry and Pandan
- Coffee and Pandan

80
70

53.3
46.7

133
12

88.7
11.3

16
3
10
5
3
2
2
37
1

10.7
2.0
6.7
3.3
2.0
1.3
1.3
24.7
.7
7

Melon
Strawberry
Coffee
Pandan
Vanilla and Chocolate
Vanilla and Melon
Vanilla and Strawberry
All

How much are you willing to spend for it?


- 30 35
- 35 40
- 40 45
- 45 50
- 50 above
What size of the container are you willing to buy?
- Small
- Medium
- Large
Where do you want to buy soy milk shake?
- Food Carts
- Restaurant
- Fast Food
- Food Carts and Restaurant
- Food Carts and Fast Food
- Restaurant and Fast Food
- All

2
26
4
12
6
6
12
1
2

1.3
17.3
2.7
8.0
4.0
4.0
8.0
.7
1.3

90
23
11
6
13

60.0
15.3
12.0
4.0
8.7

28
86
36

18.7
57.3
24.0

77
27
25
9
4
6
2

51.3
18.0
16.7
6.0
2.7
4.0
1.3

Soymilk consumption. The table above shows the characteristics of the


respondents to try Soyammy. When asked, if the respondents drink soymilk, majority or
53.3% said yes and almost half or 46.7% answered no.

Willingness of the respondents to try Soyammy. As to the willingness of the


respondents to try Soyammy, most of the respondents or 88.7% are willing and few or
11.3% are not.
Respondents preference for Soyammy flavours. When it comes to the flavours
of Soyammy, chocolate flavour gathered the highest percentage, 24.7%, followed by
melon flavour with a percentage of 17.3%.
Respondents price willingness to spend for Soyammy. When asked if how
much the respondents is willing to spend for Soyammy, a great majority or 60% of the
respondents are willing to spend 30-35 pesos for Soyammy and very few or 4% are
willing to spend 45-50 pesos to buy Soyammy.
Size of the container the respondents are willing to buy. As to the size of the
container the respondents are willing to buy, a great majority or 57.3% are willing to buy
the medium size. Some or 24% are willing to buy the large size and few or 18.7% are
willing to avail the small size.
Respondents desire where to buy Soyammy. In terms of the respondents desire
where to buy Soyammy, food carts gathered the highest percentage, which is 51.3%,
followed by restaurant, with a percentage of 18.

Demand Projection
Table 2.3 Average consumption
Frequency
Twice a day
Once a day
Thrice a week
Twice a week
Once a week
Total

Montly
16, 800
16, 200
5, 040
6, 240
8,280
52, 560

Annually
201, 600
194, 400
60, 480
74, 880
99, 360
630, 720

The table above shows the average consumption of the respondents, which is
needed for the computation of the demand projection. In order to project the demand, the
researchers used the formula:
Demand = Population x Annual Demand Sample / Sample Population
Where:
Population = 3, 100
Annual Demand Sample = 630, 720
Sample Population = 150
From the formula given, the researchers derived with P13, 034, 880 as the
demand projection.

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Table 2.4 Projected Demand for 5 years


Year
2014
2015
2016
2017
2018

Projected Demand
13, 176, 960.19
13, 320, 589. 06
13, 465, 783.48
13, 612, 560.52
13, 760, 937.43

Since the proposed product is new to the market, there can be no data to base an
annual increase of demand. The researchers decided to use the annual growth rate of
Pangasinan which is 1. 09%. Using the annual growth rate, the table above the shows the
demand projection of the proposed business from 2014 2018.
Supply Analysis
The proposed product belongs to the refreshment category, particularly shakes
category. In the market, there are already different refreshments offered. The location of
the business, however, is near to mall wherein there are already existing suppliers or the
direct competitors of the proposed product, such as Zagu, Shago, KFC Krushers and
Greenwhich Pearl Coolers, Buko Express, Buko House, La Fruitta, I love Milk Tea, Zen
Tea, and Mang Cha-a area also present. However, in determining the supply, the
researchers focused more on the competitors who offers almost the same to the proposed
product (Shago, Zagu, KFC Krushers, Greenwhich Pearl Coolers, La Fruitta and Buko

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Express). In order to get the data needed, the researchers did an interview personally to
the direct competitors. After gathering the data, the researchers used the formula:
Supply = Daily Sales x 360
Table 2.5 Annual Sales of Competitors
Direct Competitors
Shago
Zagu
KFC Krushers
Greenwhich Pearl Coolers
La Fruitta
Buko Express
Total

Daily Sales
P 3, 000. 00
4, 000. 00
2, 000. 00
3, 500. 00
4, 000. 00
2, 000. 00
P 16, 500. 00

Annual Sales
P 1, 080, 000. 00
1, 440, 000. 00
720, 000. 00
1,260,000. 00
1, 440, 000. 00
720, 000. 00
P 6, 660, 000. 00

The table above shows the annual sales of the direct competitors of the proposed
business. Using the formula, the researchers derived with the supply of P 6, 660,000. 00.
Table 2.6 Projected Supply for 5 years
Year
2014
2015
2016
2017
2018

Projected Annual Supply


6, 732, 594. 00
6, 805, 979.28
6, 880, 164.45
6, 955, 158. 24
7, 030, 969. 47

Because of insufficient data in determining the annual increase of supply for the
proposed product, the researchers also used the annual growth rate of Pangasinan,1. 09%.
Using the annual growth rate, the table above shows the projected supply of Soyammy
from 2014 - 2018.
Demand-Supply Analysis
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After determining the demand and supply, the unsatisfied demand can now be
determined. In order to find the unsatisfied demand, the researchers used the formula:

Unsatisfied Demand= Demand Supply,


Where:
Demand = Population x Annual Demand Sample / Sample Population
= 13, 034, 880
Supply = Daily Sales x 365
= P 6, 660,000
From the above formula, the researchers derived 6, 374, 880 unsatisfied demand.
Factors Affecting the Market
Demand
There are several factors that affect the demand of every consumer as purported in
most books of Economics. A change by one or combination of them will basically change
the demand data for Soyammy. The factors affecting demand includes: Price, income,
expectations, taste, and presence of childhood in the household.
Price. The law of demand states that when prices rise, the quantity demanded
falls. This also means that, when prices drop, demand will rise. People base their
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purchasing decisions on price, if all other things are equal. In a study entitled Market
Competitiveness and Demographic Profiles of Dairy Alternative Beverage in the United
States: The Case of Soymilk ( Dharmasena, et.al, N.D), consumers of soymilk are not
very price sensitive. But an increase in price would move the consumers to substitutes.
Income. When income rises, so will the quantity demanded. When income falls,
so will demand. In this study, the target market is students, which means that their income
derived from their allowance. An increase in their income can lead to purchase of
refreshment like soymilk shake, vice versa. ( Dharmasena, et.al, N.D)
Taste. This is the desire, emotion, or preference for a good or service. When tastes
rise, so does the quantity demanded. Likewise, when tastes fall, it will depress the
quantity demanded. Not all people are attracted to the taste and smell of soymilk which
might affect the demand of the product.
Presence of children in the household. Soymilk is more nutritious than other
milk like cows milk. (Pressner, 2013). In the same study, this factor affects the demand
for soymilk because parents prefer nutritious milk for children.
Supply
Like demand, supply too, has several factors affecting. The researchers must
know that the main reason why there is a change in supply is because of the cost. Other
factors affecting supply are, the number of sellers, price of inputs and taxes and subsidies.

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Number of Sellers. As more or fewer producers enter the market this has effect
on the amount of a product that producers are willing and able to sell. More competition
usually means a reduction in supply, while less competition gives the producer an
opportunity to have a bigger market share with a larger supply. The product has existing
competitors which might cause difficulty to gain bigger market share.
Price of Inputs. If the price of inputs goes up, the cost of producing the good
increases. Thus, an increase in the price of inputs leads to a decrease in supply and a
decrease in the price of inputs leads to an increase in supply. In this study, the products
used soybean which dont have a fixed price. As the price of soybeans change, it will
affect the production.
Taxes and Subsidies. Although taxes are intended for the development of our
country, business owner consider taxes as costs, therefore Soyammy tend to lower its
supply when they have a high tax. While subsidies are being given by the government to
lessen the burden of business owners in production cost, therefore the output price
becomes lower.

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Price Study
Table 2.7 Indirect Competitors
Business Name
Shago
Zagu

KFC Krushers
Greenwhich Pearl Coolers
La Fruitta

Buko Express

Size
12 oz.
16 oz.
Babby-Z
Regular
Grande
Mini
Regular
Regular
12 oz
16.oz
22 oz.
12 oz.
16 oz.
20 oz.

Price
P 30.00
35.00
35.00
45.00
55.00
45.00
65.00
39.00
35. 00
45. 00
55. 00
35. 00
45. 00
55. 00

The table above shows the prices of the indirect competitors of the proposed
product, wherein, the difference of the prices are very competitive. In comparison with
the price of the proposed product which is P30.00, the price is still favourable for it
belongs to the lowest price offered in the market.
Sales Forecast
Table 2.8 Sales Forecast of Soyammy for 5 years
Year
2014
2015
2016
2017

Annual Sales
P 600,000.00
606, 540.00
613, 151. 29
619, 834. 64
16

2018

626, 590. 83

In order the forecast the sale of the Soyammy, the researchers used the same rate
used in the projection of the demand and supply for 5 years, which is 1. 09%. Using the
rate, table 2.8 shows the sales forecast of the proposed product from 2014 2018.
Market share
In determining the market share, the researchers used the formula:
Market Share = Projected Sales/ Unsatisfied Demand x Unsatisfied Demand Percentage,
Where:
Projected Sales =P 720, 000. 00
Unsatisfied Demand = 6, 374, 880
Unsatisfied Demand Percentage = 49% (Unsatisfied Demand / Annual Demand)
Using the formula, the researchers derived a market share of 5.53%. Figure 2.1
shows the market share of Soyammy together with the percentage of the unsatisfied
demand and satisfied demand.

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MARKET SHARE
Market share

5%

Satisfied Demand
Unsatisfied demand

46%
48%

Figure 2.1 Market Share of Soyammy


Marketing Programs and Strategies
Product. Soymilk has been offered in the market, and recently it has been proven
that innovations for soymilk are taking place. As featured in 24 Oras (2013), Soymilk is
offered with different flavours to twist its taste. In this study, the flavoured soymilk will
be offered as shake product, which can be used as refreshment for the hot weather.
SOYAMMY is a new product, so the researchers decided to offer it for just one size,
medium, for it garnered the highest percentage on the survey conducted.
Figure 2.2 shows the picture of the proposed product, Soyammy. It will be offered
with four different flavours such as pandan, chocolate, melon and strawberry.

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Pandan

Chocolate

Melon

Strawberry
Figure 2.2 Sample Product

Price. The product will be offered at an affordable price that suits its target
market. The researchers decided to use the cost based pricing strategy for the business to
still earn profit. Though, the said pricing strategy is advantageous more on the part of the
business, the researchers still considered the target market, wherein, the selling price of
the proposed product, P 25.00. In comparison to the results of the survey conducted,
P30.00 had the highest percentage as to the question of how much the respondents are
willing to spend to try Soyammy. This means that the selling price of the proposed
product is acceptable.

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As mentioned above, the product will be offered for P 25.00. This was formulated
using a computation taught by the Product Management professor showed below:
Raw Materials
Flavours
Pandan
Strawberry
Melon
Chocolate
Soya beans
Tapioca Black Pearls
Crushed Ice
Mineral Water
Plastic Cups
Straw
Sticker
Total :
Divided by: Total Outputs produced
Total:
Multiply by 95.54% mark up:
Selling Price:

Cost
P 130. 00
130. 00
130. 00
130. 00
96. 00
120. 00
50. 00
30. 00
350. 00
36. 00
100. 00
P 1, 302. 00
100
P 13.02
95%
P 25. 00

In comparison to competitors price, Soyammys price is favourable and based on


the information gathered; it will be one of the lowest prices that will be offered in the
market.
Place. Before settling to the final location of the proposed business, the
researchers did an observation method to find a perfect place that would create a demand
for the product. But after a three- round trip, the researchers decided to locate the
proposed business at Rioferio Road, Arellano Street, Dagupan City. Looking at the better
side, in this location, it is very accessible to its target market as well as to the nearby
community of the said location.

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As shown below, Soyammy will have a Channel A or the manufacturer to


consumer distribution channel. Since Soyammy is manufacturing in its nature, Channel
A will be the perfect channel to be used. Also, having a direct contact between the
business and its customers can help the business to get a direct feedback from the
customers who in turn can suggest the necessary adjustments or improvements needed for
the product. And in this way, the business can have the greater chance to build a good
customer relationship.

MANUFACTURER

CONSUMER

Figure 2.3 Distribution Channel

Promotion. Promotion will be the means to reach the costumers about the
product. In this study, the product would be promoted in different ways. Television has
been one of the ways businesses used to advertise their product. This only means that the
influence of television to the target market is vast. Considering this idea, Soyammy,
should have an advertisement at the regional TV stations like ABS-CBN Channel 32 and
GMA TV 10. But this would be done when the business can already handle the costs.
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This will serve as a mean to give awareness about the product to the people of Dagupan
City. The advertisement can also be uploaded or posted in the social media like facebook
and youtube to reach wider audience, due to the fact that a lot of people spend more time
on the internet.
Another way to promote the product is by using tarpaulin indicating the price and
the location of the business. In this study, the researchers set one tarpaulin which will be
posted on the front part of the food cart. Since there are many people passing the street,
the word-of-mouth can also help to disseminate the existence of the product.
These strategies will change as the taste of the target market changes.

Figure 2.4 Sample Tarpaulin

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