Simulation Activity 1

Beverages in Philippines
Beverages in Philippines
P160
P141.90

P140
P104.08

P120
P76.34

P55.99
P100
P41.07
P30.12
P80

P60

P40

P20
Fig.1 GDP Contribution of Beverages
P0

FIGURE 2

Fig. 2 Population of the Target Market

 Since our business will be located outside University of St. La Salle Bacolod, our
target market will be the nearest Baranggay which is the Villamonte.
Simulation Activity 2

A. Product/Service Idea

Fruit shakes can be an easy way to nourish our body with essential nutrients.
Fruits are rich in fiber which is very essential for the smooth movement of the
digestive system. Our products name is “Shakes Pair”. Customers will be able to
combine their favorite fruits and control the amount of sugar they want to put in their
shake.
Our price will depends on how bigger the cups are. We will sell 10, 12, 15, 20
onz cups and price to be followed.

B. Location of the Enterprise

C. Research Data on the idea, sector and location

The Fruit Shake is one of the more popular cold beverages among Filipinos,
especially during the hot summer season. It is composed of one, fresh tropical fruit
blended with milk, crushed ice, water and granulated sugar. Some fruit shakes have at
least two, fruits mixed together to provide a different taste for the consumers.
The mango is the most popular fruit used for making fruit shakes. Other delightful
flavors of this favorite beverage include langka (jackfruit), pineapple, avocado,
strawberry, buko and melon.
The Juice and Smoothie Bars industry has grown steadily over the past five years
as operators have adapted to rapidly changing consumer preferences. In recent years,
the perceived high sugar content of some smoothies and juices has forced the industry
to adapt its offering. The industry will continue to evolve over the next five years, in
line with consumer preferences. Due to increasing competition and less certainty
about future consumer tastes, the industry is expected to become nimbler, with juice
bars subletting space from existing retailers.
The location of the business will be outside the school since our target market
will be the students, teachers and the public.
Simulation Activity 3

A. Mission Statement

Our mission is to provide fresh fruit shakes in town with a cheaper and affordable
prices.The business aims to enhance a breezy and a healthier shake from people of all
ages within the university and providing quality service to fellow customers.

B. Goals

 To be able to achieve the target profit.

 To be able to apply what we have learned from our previous subjects like
accountancy, finance, operation management and marketing

Objectives

 To purchase directly our ingredients in the market to lessen the expenses.

 To provide shakes for all types of customers.

C. Strategies

 Employee training to insure they know the best shake preparation techniques
 Marketing strategies aimed to build solid based loyal customers
Simulation Activity 4: Environmental Analysis

Macroenvironment
Political. Firstly, the business would be affected by a great raise of taxes from the
government. The increase will dealt a huge amount of damage in the profit of the
business. Raising the amount minimum wages of the employees would also affect the
business. The amount of increase will change the liabilities and the basic flow or
assets of income of the business. Newly implemented laws may occur which abstain
the totality of the business. The current political environment or a sudden change from
democratic to communist may affect the business. Dictatorship of a leader may also
lead to disrupt and change to the dealing. Lastly, endorsement of political leader to a
business would most likely be challenge to the business on the supporters.
Economic. A significant decline in economic activity spread across the economy,
caused by recession. A recession is a significant decline in activity across the
economy. The result of such may cause a loss of jobs, a decline in real income, a
slowdown in industrial production and manufacturing and a slump in consumer
spending which may affect the business. Whole sale raise prices may hurt the business
but in order for an efficient and productive run of the business it needs to cope with
the change. In addition, one of the challenges the business face is recruitment and
retention of employees.
Social-Cultural- The society and its people have a big role for the business especially
the students and its administration of the University of St. La Salle as they have the
most power in purchasing. One of the problems the business faces in order to live up
to the standards of its customers is the trends on the latest wants of the people that can
affect the profit gaining due to curiosity of new markets. Social preference of the
customers is challenging for a business which one may encounter in a daily status.
Technology- Technology is a benefit in order for fast and comfortable flow of the
business. The depreciation of the technology within the business may require
expenses for a new purchase due to daily use. Advanced technology of other business
would be a tough test of social preference and customer loyalty.
Legal- The business would most likely be affected if the image of the business would
be destroyed by unsatisfied customers with negative feedbacks to the customers.
Unsanitary beverages and place of business may involve the business overall.
Improper payment of taxes and permits may dealt the fruit stand.

Microenvironment

Porter’s Five Forces:

Rivalry among competitors. It includes price competition, advertising battles and
product introduction. It affects the competitive and influences the ability of existing
businesses to achieve higher profitability. High intensity of competitive rivalry can
make a business more competitive and decrease profit potential for the existing
businesses. This will affect the business growth in the industry since there will be a
huge competition in the market and if it results to high intensity of rivalry among
competitors there will be an excess in production. Therefore, if there will be more
competitors in the market the flow will be more intense. The business rivalry would
be: Thirsty, Infinitea, Fernando’s Buko, English Cafe and ICAFE.
New entrants. A business may be affected when new ones are being built because
there will be more options for the customers and there will be a 50-50 chance that
customers will go to the same business. It is not a guarantee that the customers would
choose the business as a place to go to daily. Since new ones are being built up,
customers often get curious and they tend to go to the new restaurants and businesses
especially Filipinos who are known to be food lovers like to try new kinds of food and
products in order to satisfy them. To add up, customers also like to explore more and
to compare the differences of the products from other business. The new entrant is the
Nescafe stand located at the University of St .LaSalle College Canteen which serves
coffee based beverages and shakes. The business has its personal stall and accessible
to customers.
Substitutes. There will be a threat in the competitive environment which can affect
the profitability of the business because consumers can choose to purchase the
substitutes instead of the business’s product. The availability of more substitutes can
make an industry more competitive and decrease the profit for the firms in the
business. The substitutes would be the vending machines, 7/11, Munsterific, and
I-mart.
Suppliers. They are known as the resources of a business and because of them a
business can operate. However, if suppliers cannot maintain in supplying the
resources needed by the business the business will run low and will profit less. If
different businesses get their supplies and resources from only one supplier there will
be a higher percentage that the market will increase in competition. The potential
suppliers would be: Rose Fruit stand-Fruit Wholesalers and Puertas Variety Fruit
Stand.
Buyers. The customers play a big role in the industry. They are known to be current
buyers or potential users that may consume the product each business offers. The
business depends on their buyers however if the business cannot perform well and
cater the additional demands of the customers there will be a possibility that the
consumers would be disappointed and they would discourage themselves to go back
to the shop and they will find another alternative for them to be satisfied. The buyers
would potentially be: students, teachers, school administration and staff, USLS
Alumni and the guardians of students. Moreover, competition is a natural part of life
when having a business. For a business to strive and compete against major
competitors they should focus on their market segment and on their basic consumers.
Recognizing and marketing to basic consumers allow for more revenue for marketing
and the ability of the business to grow. In relation to business owners, you should
know how to convince your customers and how to make your business stand out from
other competitors. The products of your business should be designed for your
customers and it should deliver a valuable promise and experience which is totally
different from your competitors. One advantage of having a business is the ability to
interact with customers directly. To be create more space, to deliver a better
experiences and exceed the customers’ expectations. There is a huge possibility for
the consumer to have another choice of interest of other business because they tend to
test new things in order to satisfy them with a new taste and product. This is also a
way of changing the perspective and desire of a customer. There are a lot of
possibilities that customers will go to different businesses because each one has its
own uniqueness and customers would like to witness and experience it.
SWOT Analysis
Strengths
 Uniqueness of the product
 High quality of products and services
 Location-based convenience for capable customers
 Efficiency and effectiveness in the supply chain
 Affordable and friendly budget prices
Weakness
 Weather condition accuracy for the products to be consumed
 Dependent on the relationship from suppliers
 Lower future growth dependency from customers and consumers

Opportunities
 The use of technology and social media websites for the business
 Advertising and promotional strategies by posters, flyers and through
technological advancements
 Higher future growth dependency from customers and consumers
Threats
 Health issues on the studies on taking the prescribed doses of sugar
 Supply and prices of ingredients gets higher
 Number of competitors, new entrants and substitutes
Simulation Activity 5
Simulation Activity 6
Simulation Activity 7
Product Description: Quality Standard
Shakespair offers different variety of fruit For shakespair we ensure the cleanliness
shakes. Such as fresh mango, of our product for every shake made
watermelon, buko, banana and melon because the safety of our customers is our
flavor. first priority. When it comes to the
ingredients, our milk is made from cows
ilk so it is fresh. For the ice , we are using
mineral water. We also use brown sugar
for the sweetness of our shake.Also, for
the main ingredient which is the fruit, it is
washed and cleaned before blending and
well-refrigerated.

Supplier Description: Volume Discounts and Delivery

Charges:
Shakespair has 2 supliers namely:
For every 5 kilos of fruit, we will have a
Rose Fruit Stand - Fruit wholesalers
10% discount to both Rose and Puertas
Puertas Variety Fruit Stand Fruit stand. Meaning to say, If the
mangoes are 80 pr kilo, and we order 10
kilos, we are going to pay 800 pesos but
Both offers variety of fruits which is there is a 10% discount. We will only pay
capable in suppying the orders and 720 pesos.
demand of the business. For every delivery they charge 500 pesos
that is from CL Montelibano to
University of Saint Lasalle. No maximum
and minimum number kilos for every
fruit delivered.
Cost of Sales: Direct and Indirect cost for product
purchases:

Direct Labor cost 15,000

Manufacturing overhead cost:
Property taxes 2000
Depreciation Equipment 10,000
Maintenance 2,000
Insurance 4,000
Rent (stall) 5,000