Marketing Plan Alaska

TABLE OF CONTENTS I. Executive analysis2 II. Situational Analysis- Macro environs Analysis5 a. Technological Environment6 b. Economic Environment7 c. Socio- Cultural Environment8 d. Natural Environment9 e. Political-Legal Environment10 III. Situational Analysis- trade Analysis f. Market Definition11 g. Market Size12 h. application Structure14 i. Porters Five Forces Analysis15 j. Competition19 k. Market Trends21 IV. Situational Analysis Consumer Analysis22 V. Situational Analysis Internal Analysis26 VI. SWOT Analysis35 VII. trade inquiry37 VIII. selling Strategies40 IX. Implementation43X. Financial Summary64 XI. Scenario/Contingencies65 XII. Appendix66 I. Executive Summary Alaska d blunt Corporation (AMC) is adept of the star(p) companies in draw mathematical crossroad from the dairy farm intentness. We draw been manufacturing dairy fruitions in the Philippines since 1972 starting with transpargonnt canned draw produces and eventu all toldy expanded to manufactu re fine-grained fil take take out and Ultra High Temperature (UHT) draw products. For e developedlywhere thirty days, AMC has emerged to be as one of the both major players in the Philippine milk persistence and is consistently master(prenominal)taining its blot leadership in the crystalline anned milk division and holds a strong maturation position in close-grained milk. AMC as well expanded into laid-backer survey-added milk products, particularly in UHT/ take in-to-Drink milk category. Since 1972, we have been caring for every Philippine family by providing them their good nutrition and health by dint of lumber milk products. Also in every other charge such as programs that promote sports rise upment, campaigns that nurture good values among children and product innovations aimed at enhancing the Filipinos health and welfare. And we shall continue caring for every Filipino family from every part of the country, may it be Luzon, Visayas or Mindanao.The tr adeplace for milk and dairy products in the Philippines comprises two very polar particles market for milk and dairy products that are processed in the Philippines from imported dairy ingredients that comprises 99% of the original market and the other 1% which is the market for products that are produced from locally produced raw milk by the Philippines dairy farming patience. Dairy products are ordinarily seen in every store, from wholesale to retail stores, and the demand for it never diminishes. Every individual pass on always have to put in attend the desire for their health and nutrition.milk products are one of the elementary necessities we should provide our bodies and that is programmed especially on the minds of every Filipino family in the country. Alaska provides the best kinds of milk from liquid to powderize that can ever be provided to every consumer market. AMCs target markets are consumers ranging from 4-12 years old. Majority of the customers are female a nd only a couple of(prenominal) are men. in the main because most of the buyers are housewives or one parents and the children they have are the consumers of the milk produced by AMC.AMC continues building the strengths and competitive props of its brand and develop its full marketing electric potential in the dairy industry. Serve every consumer to their level of satisfaction and forget move to the call to deliver higher persona nutrition to every Filipino home. To sum up product awareness, specifically on its pulverised milk product and the rise of our market share by 2 percent annually in three years. AMC has experienced and headspring-trained employees that athletic supporters in driving AMC forward with continuous superiority on product quality and strong supplier relationships.But then as costs increases, product prices also tend to increase and results to higher prices over competitors and let in the products seasonal demand and the limitation of its supply base. AMCs edge over other brands is our strong and popular reputation in the market that reveals that we have a lead in every consumer mind. Rapid technological advancements have led to innovation and lusher production with still better and high quality of goods and wider product distribution nationwide.As AMC rises, m whatsoever threats al wretched stand in the way such as competitors tend to escalate and siege AMCs produce in the market that leads to the purchasing behavior of consumers to alternate by substituting Alaska Milk Products to these cheaper brands, price wars between competitors, price cuts and so on could damage profits for AMC brought about by the economic crisis in the country. Alaskas powdered milk is creamier and tastier than any other brand in the market. Its availability and affordability may be like other brands but its focus bequeath stay on the powdered milks creaminess which makes it deliciously tasty that is enjoyed by many consumers.Also, a unique source of Alaska powdered milks production is that it uses the finest vegetable embrocate from coconuts to make it as creamy and tasty as full cream milk. II. Situational Analysis Macro-environment The macro-environment analysis are the factors that massively affects the dairy industry. These are considered the external analysis. It is sub-divided into louver aspects technological environment, intrinsic environment, political-legal environment, economic environment and socio-cultural environment.The technological environment deals with how the advent of technology affects the production of dairy products and the way the consumers receive the final products. With the modernity of facilities and equipment, the production of milk be begets better and faster. The natural environment deals with the natural issues that affects the dairy industry. Certain issues can either help or deter the buying decision of consumers. The political-legal environment deals with certain laws and regulations passed by the government that must be followed.It affects the dairy industry in a way that all companies must abide to this laws in severalise to operate. The economic environment is about the current economic changes that affects the society, the industry and the consumers. It greatly affects the consumer spending. The last aspect is the socio-cultural environment which is about the beliefs, norms, values and culture practiced by the consumers. It indicates persons behavior and social graces that leads to the buying preference of consumers. a. TECHNOLOGICAL i. With the demand of people for faster and better products and service, technology was created.It has provided the industry for the tools needed to levy the techniques and strategies to make dairy products better. Through technology, the way people search for information about the products, the way on how to purchase, and the way on receiving goods are greatly influenced. Factors effects on the Industry Online Retailing Vas t market can be reached by selling goods to people over the give the axe. This entrust provide better handiness for the users of the product. Electronic Data Interchange It will link the attach to to its suppliers through communication advancements.Making products available to variant establishment. Customer Relationship steering (CRM) A marketing tool that binds the power of computers and databases to provide the ability to collect data about consumer buying behavior on individual basis. It will help the industry to familiarize the demands of the consumers and analyze their buying behavior and produce products that will meet the needs and wants of the consumers. b. ECONOMIC ii. The economic environment scan determines the economic changes that will have an impact to the society, dairy industry and AMC like unemployment rate, exchange rate and inflation rate.In the dairy industry, these factors affect the level of income of people. Thus, affecting the buying behavior and pr eferences of consumers. Factors do on the Industry Decreasein unemployment rate The decrease in unemployment rate gives probability to an increase in family income resulting to increase in purchasing power. This will lead to remunerative commerce and increase in gross revenue of the industry. Changes in exchange rates The appreciation of Philippine Peso against US Dollar will lead to a less operating expense in the dairy industry. Inflation Rate Due to increase of expenditures in the industry, cost of sales will swell devising the consumers carry the bear down of expenses. c. SOCIO-CULTURAL iii. Socio-cultural trend analysis is one of the fundamental factors in making and developing strategic analysis. The socio-cultural environment shapes our beliefs, values and norms. In relation to the dairy industry, this socio-cultural environment analysis indicates persons behavior and social graces that may lead to change in preference and variation in consumers buying behavior. Also, certain beliefs and values can serve as advantage or disadvantage for the part of AMC.Factors Effects on the Industry Campaign for Milk Benefits and physical exertion Consumers will have better awareness over the industrys product which will attract more potential customers. Projected increase in the population With a population of 101,833,938 (July 2011 est. ) will lead to increase in the need of product. As population gets bigger, a result of higher sales and winnings is expected. Breast feeding vs. Formula milk Nutrients found in the mothers breast milk can be compared to this formula milk. But with the fast pacing everyday routine, formula feed milk can be prepared anytime. Thus it will lead to more consumers and sales. d. NATURAL/ECOLOGICAL iv. The natural environment scan is about the issues that affects the dairy industry. In particular with the environmental issues like melamine extravasation and jet marketing. As well as the nutritionary facts of the products produc ed in the dairy industry. Certain issues can either help or deter the buying decision of consumers. Factors Effects on the Industry Global problems and green industry Natural calamities and disasters can delay the production of dairy products. Thus, it may lead to decrease in the total sales of the industry. Green marketing will enable the industry to reduce its waste material.Thus, making a cleaner planet. Cholesterol content of dairy products Health and body conscious people will not consider consuming practically of dairy products as source of energy. Melamine Outbreak and contamination of dairy products. Contamination like the melamine outbreak threatens the industry growth and decreased sales of products that use milk as an ingredient. As a result, it slackens the growth of dairy industry. e. POLITICAL-LEGAL v. The political-legal environment is about how the dairy industry will adapt to changes in relation to proposed legislations, programs and other government associate issues.It is beta to know the factors affecting the political and legal environment so that AMC will be able to abide to certain legislations and programs. Factors Effects on the industry democracy Act No. 7581 The Price Act Automatic freezing of basic necessities prices in areas where a state of calamity is declared. Republic Act no. 7884 National Dairy Development Act of 1995 Improve livelihood opportunities and thereby increase income level through the dairy industry. In effect, there will be an increase in the milk produced locally and an increase in quality of living. Republic Act 7394 Consumers Act Establishes standard and quality measures for milk and adopt measures for their pure and safe supply. III. Situational Analysis Market Analysis * Market Definition Dairy industry involves processing raw milk into products such as consumer milk, butter, cheese, yogurt, condensed milk, milk powder, and ice cream, using processes such as chilling, ultimoeurization, and homogeniz ation. The dairy industry is divided into 5 varied product categories yogurt, butter, milk. Cheese and ice cream.The milk category is subdivided into 6 types, cream, powdered milk, evaporated milk, condensed milk, dried powder milk and cultured buttermilk. INDUSTRY STRUCTURE form 1 Industry Structure acknowledgment www. nda. da. gov. ph/ * Market Size The Philippines, with a population of 95,687,643 (July 2011 est. ), growing annually at 1. 903% (2011 est. ), is a large market for milk and milk products. Dairy products are the countrys scrap largest agricultural import after wheat. The countrys dairy industry, which sources 99% of its inputs from abroad, is estimated to generate sales of up to P 43. 45B annually.Philippines is a huge market for milk and milk products with a small dairy farming community that has been growing vigorously for the past two years. The dairy market generates sales amounting to P44B annually. Although Filipinos are generally considered non milk drinker s with consumption at 19 kilograms per year, the Philippine dairy market, including the market for imported milk, generates over P44billion in revenues annually. 44% of the demand for milk is concentrated in Metro manila paper. Luzon 46,228,000 (2011 est. ) Luzon 46,228,000 (2011 est. ) Visayas 27,877,103 (2011 est. ) Visayas 27,877,103 (2011 est. )Mindanao 21,582,540 (2011 est. ) Mindanao 21,582,540 (2011 est. ) * Industry Structure The market for milk and dairy products in the Philippines comprises two very different segments * The market for milk and dairy products that are processed in the Philippines from imported dairy ingredients or imported in retail packed form. This comprises well over 99% of total consumption and, * The market for products that are produced from locally produced raw milk by the Philippines dairy farming industry. This comprises 1% of total raw milk. Suppliers of imported milk (2011) Percentage Australia 61%USA 23% otherwises 16% TOTAL 100% Table 1 Ma jor Suppliers of imported milk(2011) Source www. nda. da. gov. ph/ The Philippines dairy industry consists of two distinct orbits. One is the milk powder based sector that imports, re-processes and repacks milk and milk products. The other is the liquid milk sector that has its imported UHT milk component and the locally produced fresh milk component. SECTOR IMPORTER- REPROCESSOR LOCAL draw PRODUCER-PROCESSORS TOTAL Liquid milk market 70 30 100 Powdered and other milk market 100 0 100 Table 2 Sectors in dairy industry. Source www. nda. da. ov. ph/ Figure 2 Total Raw Milk Segmentation Source www. nda. da. gov. ph/ * Porters Five Forces Analysis Figure 3 Porters Five Forces Analysis Threat of New Entrants (Barriers to Entry) The easier it is for forward-looking-fangled companies to enter the industry, the more cutthroat aspiration there will be. Factors that can limit the threat of young cranks are known asbarriers to entry. * Existing allegiance to major brands Consumers buy s pecific Alaska products that they unremarkably buy. Other local or new entrant companies will be having a hard time competing with Alaska brands since their consumers are loyal to them. Scarcityof resources Philippines imports 99% of its raw milk and only 1% are produced locally. New entrant companies will need a huge budget for importing raw milk. * Government restrictions or legislation Certain requirements provided by the government should be met by the new entrant companies in send to start their business. These restrictions and legislations help AMC to minimize competitors and to remove illegal distributors. Power of Suppliers This is how much pressure suppliers can place on a business. If one supplier has a large enough impact to affect a communitys margins and deals, thenit olds substantial power. Here are a few reasons that suppliers might have power * Number of Suppliers Large number of suppliers will then result to a high inventory level for raw milk employ for the pr oduction of dairy products. * Capacity of Supplier Suppliers must be able to sustain the quantity of raw milk needed by the companys dairy production. * Cost of Changing The total money, time and resources associated with the change of supplier. Buyer Power Buyers are the people or organizations who create demand in an industry.The bargaining power of buyers is greater when * Number of Customers Large number of buyers will then result to large amount of sales in the consumption of dairy products. * Size of each order The capacity of a customer to buy a certain product on a single purchase in order to fulfill their satisfaction. * Price sensitivity Gradual price changes should be observed to not greatly affect the consumption of the goods in the market. Threat of heterotaxy The aim of substitute products can lower industry attractiveness and profitability because they limit price levels.The threat of substitute products depends on * Substitute Performance Other brands that offer th e same quality of dairy products but have lower prices will threaten the competency of the companys products throughout the market. * Cost of change Improving the product quality and decreasing the price at the same time to reach the same demand as the competing brand. Intensity of Rivalry The impregnation of rivalry between competitors in an industry will depend on * Number of competitors Large number of competitors can threaten your position in the market. * tonus differencesAside from quantity, companies must maintain the quality of their products. In dairy industry, it is important to monitor the quality of the products because it will be your advantage over your competitors. * Customer loyalty There will be a little possibility that loyal customers will be persuaded by the competitors to switch over their products. Also, loyal customers can be companys asset since they can use the word-of-mouth. * Competition Nestle remains the undisputed leader in drinking milk products in 2 011 with a market share of 72%, 64% for Bear Brand and 8% for Nido.The companys very strong position is attributed to its long standing presence in the Philippines which enabled it to achieve strong brand equity for its brands. Alaska ranks second with 20% market share. One percent lower than the previous market share. Competitor fellowship Placement Promotions Product sizes and Price Bear Brand Nestle Philippines Available in all leading supermarkets nationwide. Free items, TV, Print and Radio advertising, Events and Sponsorships 33g P9. 5080g P25150g P46. 75300g P89. 25680g P192. 251. 1kg P331. 252. 2kg P634. 0 Nido fortify Nestle Philippines Available in all leading supermarkets nationwide. Free items, TV, Print and Radio advertising, Events and Sponsorships 160g P68. 70370g P157700g P274. 50900g P3361. 2kg P467. 251. 8kg P680. 402. 5kg P929 Anchor Full Cream Milk Fonterra Brands Philippines Inc. Available in all leading supermarkets nationwide. Free items, TV and Print ads 150g P68. 75350g P157. 50700g P276. 50 Birch Tree Snow Mountain Dairy Corporation Available in all leading supermarkets in GMA, North and South Luzon TV ads 80g P25. 75150g P48300g P93. 50700g P212. 0 Table 3 Market share of Powdered Milk Category Comparison Table Source AC Nielsen Figure 4 Market Share of powdered milk for 2011 Source AC Nielsen * Market Trends The lifestyleof the urbanFilipino is continually ever-changing wherein a local patron not only spends more time away from home but home cooked meals are being replaced by box orready-to-eat meals. With the Filipino propensity for buying only for their daily needs, the variety and availability of smaller retail packs has increased. fodder processors realize that this is a huge segment ofthe market and develop sachet packaging accordingly.Metro manila paper remains as the major market for fresh milk classified into business and consumer markets. The business markets include the institutional markets a nd the retail sector such as coffee shops, hotels, restaurants, supermarkets and small retailers. Meanwhile, the consumer markets include kins and schools through the milk feeding program of the government. Consumption of drinking milk products remains dependent on the level of consumer disposable income. During 2011, there has been a challenge for customers to stretch their budgets due to skyrocketing commodity prices coupled by the volatile prices of dismiss and utilities.With these struggles, disposable income has declined which became unfavorable in the consumption of drinking milk. Some middle and lower income consumers are not really milk consumers and milk has a low priority on grocery lists. IV. Situational Analysis Consumer Analysis The main customers of Alaska powdered milk are composed of parents who have children ages 4-12 who are currently in the so called growth gap years. Teens also consume the product because of its rich taste and creaminess. * Nature of the buyin g decision According to seek 25% of the total grocery budget of people are spent on beverages.And 10 percent of it goes to milk drinks while 5-7 percent goes to milk/dairy products. The average budget for grocery is P 7, 703. Figure 5 Consumer Spending 2011 SourceTNS Global Research * Geographic Philippines is chosen to be the target location of this strategic plan. It has a population of 95,687,643 (July 2011 est. ). The population of Luzon is 46,228,000 (2011 est. ). Visayas has 27,877,103 population (2011 est. ) and Mindanao has a population of 21,582,540 (2011 est. ). Below are the areas with their following percentage in grocery budget for milk beverage.Metro Manila together with Rizal got the highest percentage among all the areas with 13%. And urban areas give higher priority in milk beverages rather than those in rural areas. Table 4 Average Current Budget 2011 SourceTNS Global Research * Demographic The consumers are ranging from 4-12years old. Majority of the customers ar e female and only few are men. This is because the main customers are housewives or single parent and men are usually in their own jobs. The household income bracket of the consumers ranges from P30, 000. 00 to P 7,000. 00 and below. And the average budget they arrogate for grocery is P7, 703.Wherein P8, 400 are the average grocery budget of people in urban areas while P5, 400 are being spent in rural areas. Class C allots an average of P 12,000 for their grocery budget. * Psychographics The socio economic status is Class C. Class C is the majority of the consumers which composes of families with regular compensation. Consumers are in the main College Undergraduate and High School Graduate. The consumers are identified as Makers. These consumers are the low-resource group of those who are motivated by self- expression. They are practical people who value self- sufficiency.They are focused on the familiar- family, rub down, and physical recreation- and have little amuse in the br oader world. As consumers, they appreciate practical and functional products. The customers of Alaska milk products are housewives and single parents. They are practical in choosing products to buy and are more focused in family life while single parents are focused on their work at the same time with their child. They are also practical in buying products since they are the only one that supports the child. * Benefits Good quality of milk products, nutritional value and value for money are the most expected welfares of the customers.The product should be produced with good quality containing all the nutrients needed of children during their growth gap years with reasonable price. * Usage Patterns Customers are considered to be long time users since the Alaska brand has been trusted for 40 years. People grew up with the Alaska Powdered Milk and because of the inter coevals effect, tellings and mothers are usually the entities to influence the manipulation of the product. Advertise ments also influence the usage pattern of the consumers. * Purchase Patterns The frequencies of purchasing product were in work work calendar workhebdomadly and monthly basis.The numbers of milk products brought per workweek or per month are depending on consumers necessities and preferences. In supermarkets, groceries, and sari- sari stores mostly the products are brought. * Consumer/ Customer Preferences Consumers prefer a milk product that has their demanded qualities like deliciously sweet and creamy, nutritious and affordable. The four Ps, Product, Price, Place, and Promotion were all important factors considered in selection of what milk products/brand to buy. V. Situational Analysis INTERNAL ANALYSIS ALASKA MILK CORPORATION (AMC) is a leading manufacturer of milk products in the Philippines.It has established a strong brand heritage and recognition among Filipino consumers with its traditional liquid canned milk products, marketed under the Alaska brand. In addition, the smart set has developed a strong competitive position in the powdered milk category and a growing presence in the UHT ready-to-drink and ready-to-use segments. association Resources * Financial Alaska Milk Corporation delivered some other year of solid performance, ending 2010 with a new record net income of P1. 82 billion, a 29% improvement over the P1. 41 billion net income earned in 2009.Fueling the growth was the strong sales volume expansion across the Companys portfolio of milk products alongside lower input costs as well as prudent spending. Net sales for 2010 grew by 15% to P12. 16 billionfrom P10. 58 billion a year ago, underpinned by the double-digit growth of the domestic milk market as the Philippine thrift sharply rebounded from the slowdown in 2009. In addition, sustained advertising campaigns and demand-generating promotional initiatives help pushed sales volumes higher yearon- year, a significant achievement amidst aggressive contestation and market challenges.O perating expenses for the year increased significantly, by 22% at P2. 28 billion from P1. 87 billion in 2009. The increase can be attributed to higher advertising and promotional spending to boost consumer demand for Alaska Milk products. (In million pesos) Figure 6 Net Sales of AMC (In million pesos) Figure 7 Net operating expenses of AMC (In million pesos) Figure 8 Net Income of AMC (In million pesos) * People Alaska Milk Corporation recognizes that their people, the Alaska Team members, are one of their most important assets and they are committed to promote their safety and welfare.Their wealth of experience, ideas, dedication and strong work ethic lay the foundation for the Companys continued success. It is the companys goal as much as it is theirs, to pursue and reach their full potentials through continuing education, training, and skills-enhancement programs. They challenge each individual by providing the luck to contribute to the Companys endeavors. Total employees headcou nt as of celestial latitude 31, 2010 are as follows Executives-14 Managers and Supervisors-225 Rank and File-488 Consultant-1 Board of Directors Our display board of directors have successful careers in businese, academe and public service.With their wealth of experience, they add significant perspective and direction into how management shapes and executes business strategies. The Board of Directors is being led by Chairman Antonio Ozaeta. Management Team Our senior management team shares the same mission, vision and values driven by a sense of accountability to be successful as individuals and as a company. The President and CEO of Alaska Milk Corporation is Wilfred Steven Uytengsu Jr. * Product Offerings * Liquid Canned Milk The Companys setoff generation of milk products are Alaska Evaporated Filled Milk and Alaska Sweetened Condensed Filled Milk.Alaska Evaporada and Condensada are the perfect enhancers for various food and beverage preparations. Today, Alaska Milk Corporatio n has a prevalent position in the liquid canned milk category, accounting for nearly 80% of the market. * Alaska Evaporated Filled Milk * Alaska Sweetened Condensed Filled Milk * Cow chime Condensada * Alaska Creamer * Alaska Evaporada * Alaska Condensada * Alaska Milk Corporation bought from Nestle * Alpine * Liberty * Krem- make * Krem-top All purpose Cream * Also long-term licensing understanding for AMC to manufacture and sell the ff. brands for liquid canned milk products * Carnation * Milkmaid * Powdered MilkThe Company has likewise built a solid position in the Powdered Milk Category. With the heritage gained by the Alaska line of liquid canned milk products, the Companys Alaska Powdered Milk Drink, the most nutritious powdered milk, has emerged as the second leading brand in the market. * Alaska Powdered Milk Drink * UHT Ready -to -Drink Milk Alaska Milk Corporation also offers a line of Ready-to-Drink milk products that come in both plain and flavored milk. The Companys line of Ready-to-Drink milk products use Ultra High Temperature (UHT) process combined with aseptic packaging to undertake product quality, hygiene and longer shelf life. Alaska Fresh Milk * Alaska Slim Milk * Alaska Choco * Alaska Sweet Milk * Alaska Yoghurt Drink (Strawberry, Blueberry, Orange and Green Apple) * UHT Ready -to -Use Product Alaska Crema All-Purpose Cream is a result of the Companys effort to broaden its product portfolio in higher value-added segments. Launched in 2003, Alaska Crema enhances the taste of a variety of food preparations, bringing gourmet goodness at home. * Alaska Crema All-Purpose Cream * Non-Dairy Coffee Creamer The latest addition to the Companys portfolio of quality products is Alaska Krem-Top Coffee Creamer.A non-dairy coffee creamer, Alaska Krem-Top enhances coffee experience with its rich flavor and aroma. In a blind test, more coffee drinkers in Metro Manila like Alaska Krem-Top better than the leading coffee creamer brand. * Alaska Krem-Top Coffee Creamer Alaska Milk Corporation currently has a partnership with Kelloggs due the complementary temperament of the two products and the two companies thrust in promoting healthy breakfast = cereals + milk, and the formers strong operational structure and distribution capabilities. * ObjectivesMission story and Vision statement OUR VISION Is to be a leading consumer foods company with a change portfolio of consumer food brands and products that are market leaders in their respective categories. OUR MISSION harvest-tide DEVELOPMENT We will continue to build on the strengths and competitive attributes of the ALASKA brand and develop its full marketing potential. We will develop new products and identify market opportunities, mindful of our task to be responsive to the ever changing and growing needs of our consumers. PEOPLEWe recognize that our people, the Alaska Team Members, are on of our most important assets and we are committed to promote their safety and welfare. Thei r wealth of experience, ideas, dedication and strong work ethic lay the foundation for the Companys continued success. It is our goal as much as it is theirs, to pursue and reach their full potentials through continuing education, training, and skills-enhancement programs. We challenge each individual by providing the opportunity to contribute to the Companys endeavors. PROFITABLE GROWTH harvest-feast that creates value for our shareholders is paramount.We will deploy our resources on investment opportunities that are within our core competence and yield excellent offsprings relative to its risks and which are consistent with our growth objectives. SOCIAL RESPONSIBILITY We recognize our role in nation building by promoting the protection of the environment and taking part in various community-building projects that help enhance and uplift the quality of life of the underprivileged and the marginalized sectors of our society. * Financial objectives * To increase sales by 25. 5% wit hin the strategic plan period. To increase the gross profit by 37% prior to the gross profit annually. * To lower operating expenses by 2% annually. * Marketing objectives * To increase product top of mind awareness amongst the target audience by 15% for the next three consecutive years. * To increase market share by 2% annually in three years. * To increase the BUMO (Brand used more often) percentage by 13% annually . VI. SWOT ANALYSIS INTERNAL FACTORS STRENGTHS WEAKNESSES * Experienced and well trained employeesExperienced employees are the key to the success of AMC helping to drive them forward with expertise and knowledge. Superior quality of productsHigh quality products/services is a vital strength, helping to ensure customers return to AMC. * Good Supplier RelationshipSupplier relationships are strong at AMC, which can only be seen as strength in their overall performance. * Higher price than competitorsCost and expenses in the production of milk results to high price of t heir product in the market. Thus, it will add up to the out-migration costs of the product. * Fluctuating Demand of the product. The demand for the product is inconsistent. * Limited supply baseAMC uses imported milk for its products.Future events that might happen, causing delay and disturbances in the supply chain, can affect the operation of AMC. EXTERNAL FACTORS OPPORTUNITIES THREATS * well-set brand imageAMCs reputation is strong and popular, meaning people view it with respect and believe in it. AMCs position in the market is high and strong a major strength in this industry as they are ahead of many rivals. * Technological AdvancementThe trend in the dairy industry is the use of new machineries and technology for faster production and better quality of milk. AMC can follow the trend to be able to top the industry. Limited choices of productsAMC can have diversified line of related milk products to offer in the market. * Competition The dairy industry gets bigger and bigg er because new entrants in the market. Existing competitors still creates and innovates products. Thus, competition becomes intense. * Product substitutionDue to consumers practicality, they prefer to buy cheaper substitute products. * Economic CrisisA slow economy or financial slowdown could have a major impact on AMC business and profits. In effect, price wars between competitors, price cuts and so on could damage profits for AMC. VII. selling RESEARCH AC Nielsen conducted a marketing interrogation last August 19, 2011 entitled Project Silk Report A Usage, Attitude and Image Study on Milk Products Used by Food emolument Outlets . According to reasearch, powdered milk is not a widely used ingredient in food outlets. Only kapihans use powdered milk regularly. Moreover, relative to other milk categories, kapihans weekly purchase and usage volume for powdered milk is fairly low. Kapihans use powdered milk because it is creamy. Powdered milk is also liked because it is tasty and lik ed by customers. Alaska precedes Bear brand in terms of awareness and usage.Bear brand owns the powdered milk category with high brand saliency and regular usage. Despite this, Alaska performs relatively better than other powdered milk brands, since they happen to have minimal or no usage at all from kapihans. Alaska and Bear brand excel on the same attributes affordability & availability. Building a creamy image for Alaska will be an advantage since the attribute is not strongly associated with Bear Brand. Also, creaminess happens to be one of the main reasons why kapihans use powdered milk. RESULTS In general, powdered milk is not a widely used ingredient in food outlets with its usage primarily to kapihan.Figure 10 Usage of Powdered Milk Another marketing research done by TNS International Research entitled Project Hermes Lifestyle and Brand Health Check, suggests the following actions in the powdered milk category of AMC * Sustain current retention strategies as well as current strengths on being easily available and affordable * Address challenges in brand usage in Ilocos, Cebu, Davao and among middle class by * further understanding their current needs and any white spaces * continuing with communication efforts addressed to these segments * come along strengthen branding of ads aired to maximize motivational promise.It also discussed the advertising efforts of AMC and its competitors in the powdered milk category. The figure below shows the performance of the ads in powdered milk category. Figure 11 Ad performance measurement The TV ad of Alaska entitled Alaskas Buboy featuring Caesar Montano gained positive comments. According to the research, the company did a great job in choosing Montano as the endorser of powdered milk. Montano gained 83% positive comments while 4% of the respondents viewed it negatively. And the remaining 11% did not comment. This shows that TV advertisements contributes alot to brand awareness.VIII. MARKETING STRATEGY * Solution The first strategy to be used by the company is redesigning the product. AMC will create a new packaging design for the powdered milk so that it can capture the interest of the people. The next strategy to be used is development. We will add nutritional value to current powdered milk so that it can fully satisfy the needed nutrition of the children. The last strategy to be used is creation. We will innovate the product into another variety like Alaska Powdered Milk for Adults or Alaska Powdered Chocolate Milk to capture different segments of the market. Information The strategies to be used in creating and building brand awareness are focused advertising and sales promotions. One way to spark interest for AMCs product is through advertising. We will develop a TV commercial since almost all household owns a television set. The next action that we will do is to advertise through transportation medium like taxis and buses. This action is applicable for Mega Manila. Lastly, we will pri nt out stickers to be posted at the back of tricycles in the provinces. Another strategy is through sales promotion.This can be through coupons and gift certificates, contests and collectibles and freebies. Lastly, we will be having events and sponsorship. We will conduct concerts for a cause and other fund raising activities. The monetary resource that we will get will be used for school feeding programs and activities and for charitable institutions. We will also be having caravan tour for brand activation. With the caravan tour, we will be giving samples of our product. * Value This strategy focuses on how will the company reduce its price to be more competitive in the market. The first strategy is through competitive pricing.This can be done by lowering the distribution costs. Thus, it will result to lower price of the product. Another one is through discounts. This will be applicable for bulk purchasing. The next strategy will be promo package. We will be having bundles where in the powdered milk will be partnered in other products of Alaska. * Access In order to boost the sales, one way is to improve the distribution system and increase the number of distribution channel that can be used to distribute. In order for the product to be more accessible, our strategy will be through online marketing. The economies of scale will lessen.Thus, the burden of distribution expense will not be carried by the consumers anymore. We will also be having free deliveries within Mega Manila. Lastly, we will be offering online services for loyal customers. The next strategy will be Direct Marketing. We will promote the powdered milk in different retail stores to make the product more accessible to all targeted locations. Next will be thru door-to-door selling. We will designate certain number of sellers to offer the powdered milk to household consumers. The problem of mobility of our product will be resolved with the use of carts to sell the product.IX. Implementation Pl an SOLUTION * Product Repackaging One way to capture the interest of target consumers is through creative packaging. We will be planning what will be the best packaging design and size for the powdered milk. Action subdivision use up condemnation Frame Budget preparation and organizing a team to create a new packaging design Marketing department representatives 5 days1st week of celestial latitude P 50,000 Finalizing and approval of new packaging design plan Product department 1 day1st week of celestial latitude P 20,000 operate Testing Marketing surgical incision 1 week 2nd week of December P700, 000 Reevaluation of the pilot exam Operation department 1 week tertiary week of December P 50, 000 Start of repackaging process Operation division 1 week4th week of December P 2, 500, 000 Start of distribution on newly repackaged products 1st week of January P 1,000, 000 * Product Development The Product development strategy will focus on adding nutritional value to the current product of AMC which will benefit the target consumers. With its improved nutritional facts, more health conscious parents will be attracted to purchase the product.Thus, leading to an increase in sales for the company. Action/Activities discussion section/Person involved Time frame Budget Planning and generating ideas for the product development. Research and Development Department 1 monthJanuary P 3, 000, 000 Product screening and evaluation. Top Level Management and Marketing Department 2 weeks1st to 2nd week of February P 50, 000 Register/ event of License to Operate (LTO) and approval of Bureau of Food and Industry (BFAD) Marketing Department 3 months3rd week of February to 2nd week of May P 60, 000 Producing sample products that will be used in product examination. Production Department 1 week3rd week of May P 1, 500, 000 Test Marketing. Marketing Department 1 week4th week of May P 500, 000 Pilot testing Marketing Department 1 monthJune P 2, 500, 000 Reviewing the results of the pilot testing. Marketing and Research Department 1 week1st week of July P 80, 000 Producing product samples and real(a) products that will be distributed. Production Department 2 weeks2nd and 3rd week of July P 3, 500, 000 Introducing the product to the market and distributing product samples. Marketing Department 1 week4th week of July P 1,500, 000 Distributing the actual products. Marketing Department 1st week of August P 1, 000, 000 * Creating New Product Another strategy that we will be using is the creation of new product. AMC will create a new product that will satisfy the demands of the consumer. We will make another segment of powdered milk that will process not only the children under the growth-gap years, but also other potential customer that consumes powdered milk in their daily basis.The creation of new product will expand the target consumers of AMC and will also increase the potential buyers of the product. Thus, it will increase the sales of AMC. Action/A ctivities Department/Person involved Time frame Budget Planning and creating a research study about consumer demands. Research and Development Department 3 monthsJanuary-April P 2, 500, 000 Reviewing research report and planning and brainstorming of ideas for the new product development. Marketing Department 3 weeks1st week of May- 3rd week of May P 90, 000 Creating the new product Production Department 1 month4th week of May- June P 4,000,000 Product screening and evaluation. Top Level Management and Marketing Department 1 week1st week of July P 50, 000 Register/Issuance of License to Operate (LTO) and approval of Bureau of Food and Industry (BFAD) 3 months2nd week of July to 2nd week of October P 100, 000 Producing sample products that will be used in product testing. Marketing Department 1 week4th week of October P 3,000,000 Test Marketing. Marketing Department 1 week1st week of November P 300, 000 Pilot testing Marketing Department 1 month2nd week of November to December P 3 , 000, 000 Reviewing the results of the pilot testing. Marketing Department 1 week2nd week of December P 50, 000 Producing product samples and actual products that will be distributed. Production Department 2 weeks3rd and 4th week of December P 4,000, 000 Introducing the product to the market and distributing product samples. Marketing Department 1 week1st week of January P 2, 000, 000 Distributing the actual products. Marketing Department 2nd week of January P 500, 000 INFORMATION * ADVERTISING Transit Advertising Transit advertising will be done to create product awareness. We will be using different transportation medium to advertise. We will use taxis and buses to roam around the meddling streets of the metro, While in the provinces we will use stickers to be posted at the back of tricycles. Action Department take aim Time Frame BudgetPlanning and Selecting of modes of transportation for transit advertising Marketing department representative 2 days1st week of February P 20 ,000 Planning and making of the stickers for tricycles and jeepneys. Marketing department representative 3 days2nd week of February P 1,200,000 Finalizing of transit advertising plan Advertising department 1 day2nd week of February P 30,000 Meeting with representatives of the chosen Bus companies and jeepney operators Marketing department representative 2 days3rd week of February P 30, 000 Start of transit advertising.Coverage of transit advertisement(Bus, Tricycles, Jeepney) 1st week of March P 5,000,000 * Television Advertising about all Filipino household owns a television set. TV advertising has the power to show and tell many people about the product, and actually demonstrates the benefits of getting it. Since they see how it works and how it is packaged, every time they see it they will be psychologically reminded of their desire to have it.Action Time Frame Department Involve Budget Planning and Selecting of artists, celebrities and personalities to endorse the product in TV ad. Marketing Department Representative 1 week1st week of February P 50,000 Meeting with managers of selected artists regarding payments, endorsement, terms of agreement Marketing Department Representative 1 week2nd week of February P 150, 000 Contract signing and partial payment of the company to the selected endorsers. Company project head, Mangers and Endorsers 1 day3rd week February P 2,000,000 Meeting with representatives of advertising company regarding the execution of advertising plan. Marketing Department Representative 1 week1st week of March P25, 000 Creation of story board by the chosen Advertising Agency Advertising Agency 6 weeks2nd week of March P 2,000,000 Finalizing the advertising plan for television. Advertising Department 1 week1st week of May P 50,000 Pilot airing of TV ad Advertising Department 1 week3rd week of May P1, 500, 000 Coverage ofTV advertisement. (ABS-CBN 2, GMA 7 and TV5) 1st week of June- July1st week of October- December P 30,000,000 SALES PROMOTIONS * Events and Sponsorship We will be holding events like concert for a cause, fun run and different fund raising activities from which we can promote the products of the company. The proceeds of the events will be used for school programs and activities for the betterment of children. Also we will accept application for sponsorship related to the objectives and goals of the company.Action/Activities Department/Person involved Time frame Budget Review the sponsorship and exhibitor packages and related benefits Marketing Department 1 week1st week of October P 30, 000 Determining and selecting which best potential event/ exhibit meets the companys goal Marketing Department 1 week2nd week of October P 50, 000 Meeting and organize with the event/exhibit organizers Marketing Department 2 weeks3rd week to 4th week of October P 50, 000 Evaluation and approval for the sponsorship Top Level Management 1 week 1st week of November P 50, 000 Preparing and allocating funds for the ev ent that will be sponsor Finance Department 1 week2nd week of November P 2, 000, 000 arrogate data and measure results Top Management 1 week3rd week of November P 30, 000 * Caravan This strategy will be focused on visiting different schools on the month of August, in line with the celebration of the Nutrition Month. There will be selected schools around the country that will be visited by our team and we will give powdered milk pouch samples to the students of the chosen school. It will contribute to the increase of brand awareness to our target consumers. Action Department Involve Time Frame Budget Planning and organizing a team to conduct the caravan. Marketing Department 1 week1st week of June P 30,000 Identifying the school that will be the scope of the caravan. Marketing Department 1 week2nd week of June P 20,000 Contracting a certain bus company for the leasing of the bus and for the terms and conditions. Marketing Department/ Finance Department 1 day3rd week of June P 500, 000 Designing the bus that will be used in the caravan. Advertising Department 1 week4th week of June P 50,000 Preparing the sample products that will be given out to the students of the chosen school. Production Department 2 weeks1st-2nd week of July P 1,500,000 Start of the caravan. Logistics Department alone month of August P 150,000 * FUND RAISINGAction/Activities Department/Person involved Time frame Budget Developing goals and making fundraising plans Marketing Department 2 weeks1st week of June P 70, 000 prying for prospects that can help in the fundraising activities Marketing Department 2 weeks3rd to 4th week of June P 50, 000 Searching for venue/facilities needed in the fundraising and other related materials Marketing Department 1 week1st week of July P 40, 000 Estimating and allocation of fundraising programs costs Finance Department 1 week2nd week of July P 30,000 Finalizing plans and evaluation of the programs and events Top Level Management 2 days3rd week of Jul y P 20, 000 Meeting and coordinating with organizers and other sponsors Marketing Department 1 week4th week of July P 60,000 Fundraising Activity 1 month August P 1,000,000 Program evaluation Marketing department 1 week1st week of September P 50, 000 PRICING PRICING * Promotional Package ( Bundle ) Promotional package will attract more potential customers since they can avail discounts when they buy a bundle of AMC products in line with the Alaska Powdered Milk. Action Department Involve Time Frame Budget Planning and choosing of products that will be used for the promotional package. Marketing department 1 week2nd week of September P 50,000 Meeting with the owners of the chosen supermarkets wherein the promotional package will be distributed. Marketing department 1 day3rd week of September P 20,000 Finalizing and creating the design of the packaging. 1 week4th week of September P 1,000, 000 Distributing the promotional package. (SM supermarkets, Robinsons Place supermarkets and Puregold) 1st week of October Last week of December P 800,000 * Minimizing Distribution Cost This strategy will be focusing on minimizing the distribution costs. Minimizing the cost will contribute to the aim of having a competitive pricing. By reducing the cost, we can also reduce the price. Action/Activities Department/Person involved Time frame Budget Reviewing distribution system. Logistics Department 1 week2nd week of January P 10, 000 Brainstorming about the documents. Logistics Department 1 week3rd week of January P 15, 000 Planning and organizing Distribution system Logistics Department 3 weeks1st 3rd week of February P 30, 000 Eliminating unproductive labor and Reducing waste and material usage. Top Management 2 monthsMarch- April P 100, 000 Improve equipment performance and space usance through consolidation Logistics Department 2 months1st week of May-June P 500 ,000 Implementation of the new distribution system Logistics Department 1st week of July P 1, 000, 000 * Discounts As competition in the milk industry arises, several discounts and promos are coming out in the market. So we also plan to have discounts as one of our strategies to generate interest in getting customers to try Alaska milk products.It will enable more target markets try Alaska Milk products within their budget capability. Action Department Involve Time Frame Budget Planning the discounts to be place in the market. Marketing department representatives 1 week1st week of December P 10,000 Identify the target location/area to put the discounts. As well as, identifying how much discounts there would be. Marketing department 1 day2nd week of December P 5,000 Consultation and evaluation of the discount plan. Top Level Management/ Marketing department 1 week3rd week of December P 1, 500, 000 Allocation and budgeting of the discounts to be placed. 1st week of January P 500, 000 ACCESS * Online MarketingOnline Marketing is one way of making Alaska milk products more accessibi lity in the market in which it less time consuming and more convenient to the wholesale target consumers. We will be offering the products only and they can acquire the products in wholesale through the internet. We will also be having free delivery service. Action Department Involve Time Frame Budget Planning and making a web layout design that will be used for the Online Marketing. Advertising Department 2 weeks1st-2nd week of January P 100,000 Hiring an additional workforce that will maintain and respond to the customers demand/inquiries. Human Resource Department 1 month3rd week of January-3rd week of February P 10,000 Launching of the Online Marketing Website of Alaska Milk Corporation. March P 200,000 * Direct Marketing This strategy is designed to increase the sales in which the sales force of Alaska Milk Corporation will conduct door-to-door selling in order to offer the products directly to the customers and generate sales. Action Department Involve Time Frame Budget Pla nning and organizing a team that will conduct the door-to-door selling. Marketing Department 1 week1st week of March P 50,000 Identifying the location in which the door-to-door selling will be conducted. Marketing department 2 weeks2nd-3rd week of March P50,000 Orienting and training the sales force about the door-to-door selling. Human ResourceDepartment 3 weeks4th week of March- 3rd week of April P200,000 Preparing the materials and products that will be used in the door-to-door selling. Production Management 1 week4th week of April P2,000,000 Start of the door-to-door selling. May P500,000 X. Financial Summary XI. Contigencies 1. uncaused Events like natural calamities The company must have inventory management to assure the availability of supply in case of these events. 2. Contamination of raw materials The Company should have an alternative supplier to still meet the demand for their products. 3. Problems regarding pests and rodents Quality control should be practiced b y the company to assure the safety and quality of the products. . Recession The Company must still be able to meet the demands of consumers by means of inventory management. 5. Change in Technological environment The Company should adapt to the advent of technology to be able to have better and faster production and service. XII. Appendix I Alaska Milk Corporation Corinthian Plaza, walkway de Roxas Building, Makati City, Manila www. alaskamilk. com. ph National Dairy Authority www. nda. da. gov. ph National Statistics Office www. census. gov. ph www. nso. gov. ph Chanrobles Virtual Library www. chanrobles. com Department of Trade and Industry www. dti. gov. ph Ivory Qual Full Report AC Nielsen Research www. ielsen. com Projecy Hermes Final Report TNS Global Market Research www. tnsglobal. com Project Silk Report AC Nielsen Research www. nielsen. com Appendix ll Powdered Milk Offtake June 2008 Nov 2011 (In Tons) www. alaskamilk. com. ph Usage Performance Cesar Montano for APM TNS G lobal Market Research www. tnsglobal. com How Is The Budget Spent? TNS Global Market Research www. tnsglobal. com regular Grocery Budget TNS Global Market Research www. tnsglobal. com Weekly Purchase Volume of Powdered Milk AC Nielsen Research www. nielsen. com Quality Awareness AC Nielsen Research www. nielsen. com APPENDIX III AMC Annual Report www. alaskamilk. com. ph