TABLE OF CONTENTS

Page

I. Company Profile
A. Brief History
B. Mission / Vision Statement
C. Product / Service Offerings
D. Selected Product / Brand to be studied
II. Macroenvironment Analysis
A. Economic
B. Political-Legal
C. Socio-cultural
D. Demographic
E. Technological
III. Industry Analysis
A. Industry participants
B. Competitor analysis
i. Product
ii. Target market
iii. Product features and benefits
iv. Packaging
v. Labeling
vi. Wholesale and suggested retail price
vii. Distribution network
I. Company Profile
A. Brief History

Gardenia Bakeries Philippines Incorporated

The year was 1978, Gardenia started out as Horatio “Sye” Slocumm, an American baker with over
35 years of experience, opened an in-store bakery in Singapore. His original recipe is credited for
Gardenia’s dramatic rise in the region. Fast-Forward to 1997 Gardenia entered the Philippine bread market
and established its factory in Biñan, Laguna. Shortly thereafter, the factory was rated as one of the largest
and most modern bread manufacturing facility in the country. From 1999 to the early 2000s, several new
product lines were added to Gardenia’s lineup. In 2003-2004, Gardenia was accorded Superbrands status
and inagurated two new plants. The years 2009-2012 saw new highlights as increased production, three
Program Achievement Awards from the Department of Trade and Industry, and another batch of products
increased the company’s value. In 2016, Gardenia again expanded operations and invested another
sophisticated and world class plant capable of producing 6000 loaves per hour.

B. Vision / Mission Statement1

Vision Statement
To be the premier company in the baking and food industry that provides best quality products enjoyed, valued, and
loved by customers.

Mission Statement
To provide an assortment of best quality, great tasting, nutritious, and enjoyable bakery and food
products that are within sight, within reach, and within the hearts of consumers; produced using world
class manufacturing facilities and processes utilizing quality and safe ingredients, thereby creating values
beneficial to stakeholders, including employees, suppliers, trade partners, financial institutions, investors,
and the community.

C. Product / Service Offerings2

1. White Breads - High Fiber Whole Wheat Bread – 600g

- Regular – Slice 600g - High Fiber Whole Wheat Bread – 400g
- Thick-Slice – 600g - High Fiber Wheat Raisin Loaf – 600g
- Regular – 400g - High Fiber Wheat Raisin Loaf – 400g
- Slim Fit Wheaten Bread – 350g
2. Health Breads - Wheat Cranberry Loaf – 370g

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https://www.gardenia.com.ph/about-us September 14, 2018
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https://www.gardenia.com.ph/products September 14, 2018
 - Peach Mango Fun Bun
3. Flavored Breads
- California Raisin Loaf – 400g 6. Pocket Sandwiches
- Chocolate Chip Loaf – 400g - Cheese Filled, Filled White Bread
- Double Delights Ube and Cheese Loaf – - Strawberry Pastillas Filled White Bread
400g - Peanut Butter Filled White Bread
- Double Delights Choco and Mocha Loaf - Chocolate Filled White Bread
– 400g
- Double Delights Strawberry and 7. Snack Cakes
Blueberry Loaf – 400 - Twiggies Yellow Cake
- Amazing Black Forest Loaf – 400g - Twiggies Pink Cake
- Amazing Butterscotch Loaf – 400g - Twiggies Choco-Brown Cake
- Chocolate Muffin
4. Pandesal & Buns - Blueberry Muffin
- Premium Pandesal – 350g - Banana Chocolate Muffin
- Soft Delight Pandesal – 300g
- Whole Wheat Pandesal – 350g 8. Toasts
- Cheese Buns – 250g - Butter Toast
- California Raisin Buns – 300g - Garlic Toast
- Cinnamon Toast
5. Filled Buns - Honey Wheat Toasties
- Cheese Pimiento Cream Roll - Butter Toasties
- Pizza Cream Roll - Cheese Toasties
- Butter Sugar Cream Roll
- Chocolate Cream Roll 9. NeuBake
- Cookies N’ Cream Roll - NeuBake White Bread – 450g
- Choco Strawberry Cream Roll - NeuBake Super Slice White – 300g
- Rocky Road Cream Roll - NeuBake Wheaten Bread – 300g
- Chocolate Fun Bun
- Ube Fun Bun 10. Delicia Sandwich Spread

D. Selected Product / Brand to be studied

Gardenia Pocket Sandwiches is a relatively new product introduced to the market just recently.
This concept in the local setting is relatively new as Pocket Sandwiches has served as a means of
having something to eat while being on the move, part of a busy lifestyle, or having something
convenient. Also, its features of simplicity, portability, versatility has made it popular for several
people looking for a way to have nutritious food that is accessible and does not create much clutter
 or mess. The group chose this product as they believe that there is large untapped potential that
can be seen in something that is compact, in which they intend to expand. This includes the
spawning of several variants, and the increase of a more dynamic Filipino population and lifestyle
through this product.

II. Macroenvironment Analysis

Economic Macro-Environment Factors

Factor Implication Effect on Product

September Inflation Rate is at 6.7%
in 20183
Foreign Exchange Rates have
reached the $1:PHP54 mark4
Rising Costs of Diesel for the past
5 weeks5
There might be a possible
increase in prices of general
commodities, including bread.
Possible increase of costs due to
increase in prices of certain
imported raw materials that
Gardenia Bakeries may use for
their product lines.
Increase of transportation and
possible utility costs for Gardenia
Bakeries to ship products
nationwide.
Possible Decrease in Demand
for staple goods due to rising
prices. Possible Minimal
Decrease in Sales Revenues.
Price may increase substantially
coupled with the inflation rate as
mentioned earlier, but likewise
Sales Revenues will take a hit as
well as Sales Profits.
Prices of each product line may
be adjusted substantially to
account and accommodate for
this cost.

Inflation Rate
As of recent, the inflation rate of the Philippines has increased greatly. According to the latest
data from the Philippine Statistics Authority, September Inflation Rate have reached 6.7% in 2018. This
puts a strain on consumers as this means that costs for necessities have risen substantially by several
pesos. But as of recent, the price of our product has barely changed, if any, as it still sells between P12 to
P15 depending on which outlet which may imply the manufacturer has managed a mastery of cost control
in line with this issue.
Foreign Exchange Rate
According to the latest data from the Bangko Sentral ng Pilipinas, the Foreign Exchange Rate has
recently reached the PHP54: $1 mark. This means a great deal to Gardenia, as they source their raw
materials and ingredients from abroad (www.ijbmi.org, 2017). As such, importation and costs may increase
as the mode of currency to pay for these suppliers are in dollars whereas general revenue depends on the
local currency.

3
www.psa.gov.ph September-October 2018
4
www.bsp.gov.ph September-October 2018
5
www.doe.gov.ph September-October 2018
Rising Costs of Diesel
Over the course of 6 consecutive weeks, Fuel Prices in general have increased substantially.
Starting with a baseline price at the beginning of this document with the latest fuel prices, the price of Diesel
has increased by almost as much as P5. As each logistics operation involves the use of fossil fuels to move
around all goods and services, and for Gardenia Bakeries Philippines to ensure their “Guaranteed
Freshness”, appropriate measures must be accounted for this increase in cost.

Political-Legal Macro-Environment Factors6

Factor Implication Effect on Product

R.A. 11035 – “Balik Scientist Act”
R.A. 11052 – “Philippine Food
Technology Act”
Possible Technical and Scientific
Influx of Information in creation,
production, and processing of
certain items
Possible Improvements on Food
Technology and Increased Food
Quality Standards
Possible improvement of bread
production, processing, and
preservation
Increased food standards,
Improved processing, and
Increased Product Shelf Life

A.O. 13 Series 2018 – Removal of
non-tariff barriers and the
streamlining of administrative
procedures on the importation of
agricultural products7
Reduction of duties and taxes Possible reduction or status quo
aside from the costs incurred from on prices, considering the current
purchasing imported raw materials inflation rate

R.A. 11035 – Balik Scientist Act

The Balik Scientist Act is a Program initiated by the Department of Science and Technology to
lure back and entice several intellectual persons to improve the scientific and technological standing of
the country. Though more specific on these two premier topics, it does not also limit to other perspectives,
such as business to foster development and progress in the Philippines.
R.A. 11052 – Philippine Food Technology Act
As stated in Sec. 2 of this Act, “The State recognizes the importance of professional food
technologists in nation-building and development” In line with this, the government has created a new
section under the Professional Regulatory Commission called The Professional Regulatory Board of Food
Technology. Under this act, there will be a standardization of Food Technology Practitioners and
Certification exam, as well as a Code of Ethics. This would ensure quality Food Technologists which
would improve the quality and standard of foods produced in the Philippines.

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www.congress.gov.ph, 17th Congress
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www.officialgazette.gov.ph September 2018
A.O. 13 Series 2018 – Removal of non-tariff barriers and the streamlining of administrative
procedures on the importation of agricultural products
As a measure to counter the rising costs of necessities due to inflation, the President issued this
Administrative Order to combat particularly the costs of agricultural products. The intention is to increase
the quantity of products by means of imports and streamlining of import procedures and regulations. This
applies to our product in two products: Flour and Sugar. This means that with streamlined policies and a
reduced import tariffs on these products, Gardenia may be able to maintain price control throughout the
production of their products with regards to the rising inflationary costs.

Socio-cultural Macro-Environment Factors8

Factor Implication Effect on Product

Consumers increasingly choosing
to live in smaller households
Filipinos are increasingly looking for
convenience and accessibility.
Increase in consumer demand for
packaged or ready-made or
ready-to-eat goods
Increase in several convenience
outlets and changes in consumer
eating habits
Increased demand for the
product; may require further
variations of the product to meet
consumer wants
Increased product availability
and product demand

Rising Income and busier lifestyle Increase in consumer demand for Increased demand for the
of Filipinos are driving high convenience goods, particularly product
demands for convenience or foodstuffs
packaged foods

Consumers Increasingly choosing to live in smaller households

Based on the data given on the Euromonitor report concerning Consumer Lifestyles in the
Philippines, there is a becoming trend among the younger consumers to reside in smaller household units
in urban centers which have fueled the demand for packaged foods and other food items in nearby
convenience stores. This is brought about by these individuals due to education and employment
opportunities. A possible effect of these trend will be an increase in outlets wherein packaged and ready-
made or ready to eat goods will be made available to supplement demand by these consumers.
Filipinos are increasingly looking for convenience and accessibility
Based on the same data from the Euromonitor report Consumer Lifestyles in the Philippines under
Shopping Category in the Main Household Shop section, Filipinos are increasingly looking for convenience
and accessibility, particularly in urban areas. This drives the demand for convenience stores and small
format supermarkets. This also replaced cooking or eating at home with eating out or purchasing take-

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http://0-www.portal.euromonitor.com.ustlib.ust.edu.ph/portal/analysis/tab
aways. As such, a possible result of this will be that there will be an increase in product availability and a
larger increase of product demand.
Rising Income and busier lifestyle of Filipinos are driving high demands for convenience or
packaged foods
Based on the same data from the Euromonitor report Consumer Lifestyles in the Philippines
under Eating and Drinking Category in the Eating Habits section. Like the previous factor, hectic lifestyles
by urban dwellers has prompted Filipinos to eat out more frequently than at home. Likewise, convenience
stores have attracted urban workers with simple meals and quick snacks to save them having to prepare
food themselves.

Demographic Macro-Environment Factors

Factor Implication Effect on Product

Expanding middle class driving
increased demand for wide range
of products and services9
The Philippines’ economic growth
sets Social Class B and C to rapidly
expand10
High Demand for several products
and services; High competition for
the best product or service for the
best value
High Economic growth sets a
trend for increased purchasing
power
Increased demand for variation
and differentiation on the
product, increased competition
from competitor’s product
offering
Increased demand for product in
larger quantities or portions

The Philippine Employment rate High Employment equals High Increased demand for product
stands at 94.6% as of July 201811 demand for foodstuffs to sustain across several sectors
long working hours

Expanding middle class driving increased demand for wide range of products and services
According to the Consumer Lifestyles section of the Euromonitor about the Philippines, despite
the high unequal income distribution, the purchasing power is rising. This is attributed to younger
consumers who are better educated and connected to the internet. This has implications that many of
these consumers are very knowledgeable about several products and that by increasing their online
exposure this will also relate to better sales.
The Philippines’ economic growth sets Social Class B and C to rapidly expand
According to the Consumer Expenditure section of the Euromonitor about the Philippines, the
economic growth in the Philippines will continue to allow a portion of poor households to access the middle
class, with class C having the strongest rate of expansion over a 5-year period. Now this means that there

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http://0-www.portal.euromonitor.com.ustlib.ust.edu.ph/portal/analysis/tab
10
http://0-www.portal.euromonitor.com.ustlib.ust.edu.ph/portal/analysis/tab
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https://psa.gov.ph/content/employment-rate-july-2018-estimated-946-percent
will be more people having access to goods and services that they never had before. This means that many
products can be now within reach of these persons, particularly food products.
The Philippine Employment rate stands at 94.6% as of July 2018
According to the latest data from Labor Force Survey from the Philippine Statistics Authority,
Employment rate stands at 94.6% as of July 2018. Most of those persons are employed in the service
sector. As performing a service may usually require long hours, one would think about the type of food
one would need to keep going. As such, a possible effect of this increase in the labor force is an
increased demand in the product.

Technological Macro-Environment Factors

Factor Implication Effect on Product

Self-checking RFID counters in Reduced staff operations, Increased consumer information
Supermarkets Increased speed of checkout time for the manufacturer

Robotic Process Automation – Rule Increased efficiency in processing Increased efficiency in

Based Robots and manufacturing foodstuffs production of the product

Electromobility: Use of Electric Lowers operational costs for Lowers cost on product;
Trucks in Delivery transportation and logistics Increases efficiency in delivery
and transportation of the product

Self-checking RFID counters in supermarkets

According to Panasonic, who conducted a demonstration experiment on the industry’s first "RFID
based walk-through automatic checkout solution" featuring Trial's "RFID tagging," which manages
manufacturing and distribution data. The idea is that customers can automatically checkout by walking
through the checkout lane with the basket containing products with RFID tags. By scanning information
of, for example, prepaid cards in advance, the solution will automatically scan products and complete
payment, thereby significantly shortening the checkout time. The implications of this is that there would be
reduced staff operations and increased speed of checkout time. But this also has a direct effect on
Gardenia as it may provide them with increased consumer information that they may need in order to
effectively market their products.
Robotic Process Automation – Rule Based Robots
According to the data provided by SAP, RPA can lead to an estimated 25-50% in cost savings. The
group recently conducted a plant tour to see if there are any technological changes in the bread
manufacturing process. They found that Gardenia recently purchased a machine called a Robo Grip Lidder
and plans to procure several other machines in the coming years. As a result, Gardenia increased efficiency
by reducing manpower and used automation for certain repetitive tasks. Likewise, this will also lead in a
reduction of costs and Increased output of their products.
Electromobility: Use of Electric Trucks in Delivery
According to Volvo, Electromobility is playing a key role in our move towards sustainable
transportation. Electric Trucks are now becoming a reality and a viable commercial solution for cities and
businesses. As such, the effects of these machines soon may allow reduced costs in operations,
particularly in transport, logistics, and fuel costs. Likewise, it may also reduce the overhead costs thereby
reducing the cost of the product and increased efficiency in its transport and delivery.