MARKET FEASIBILITY

INTRODUCTION

The heart of your business lies in its marketing. It involves getting the right product at the

right price, promoted using the right messages/media and sold in the place (the 4p’s). At the core

of affective marketing is the requirements to satisfy customers needs precisely, the closer the

marketing mix of product, price, place, and promotion are to customers requirements, the more

likely is that a business will be successful. Marketing has to determine what customers need now

and anticipate future needs in order to design appropriate products to meet these needs.

The topic covers the following aspects; demands, supplies, demand and supply gap

analysis, marketing programs and the projected sales.

Every business is practically aspiring for productivity but practicality. In order to last in the

business world, the first thing to take into consideration is the target market. The customers will

be the key factor to achieve the objectives of the organization. Finding opportunities and spotting

the right target market are both important in establishing a business. Knowing customer’s

demand and supplying them with the right product at reasonable prices.

GENERAL OBJECTIVES
  To determine the feasibility of the business.

 To analyze the market demand and supply of the business.

 To define the target customer of the business through market segmentation.

 To determine the marketing strategy to be applied in the business.

 To determine the market potential of the business.

SPECIFIC OBJECTIVES:

INDUSTRY ANALYSIS

Grocery stores are traditional destination for consumers looking to stock up on many of

the items they use on a day-to-day basis. The need for shoppers to replenish their pantries and

refrigerator typically results in frequent trips to the supermarket. Consumers typically have a

variety of options to choose from when deciding where to purchase items. Not only do they often

have a choice between competing neighborhood supermarkets, but they can also shop at

alternative retailers. Because of this, individuals, parents or mostly sari-sari store owner find

supermarket or grocery stores at great convenience. The rise of merchandise industries as often

been linked with urban development, this kind of notion can be typically seen in Filipinos.
  A growing wholesale retail industry

Over the past decade, the county’s retail industry has grown significantly,

benefiting from the steady economic and population growth, higher disposable

incomes, and increasing urbanization. This trend is expected to continue growing

forward.

KEY SUCCESS FACTORS IN THE INDUSTRY

In a company such as Puregold Supermarket, innovation is important because

competition in the merchandising industry is very tight. Product innovation is a must as it add

value to the company since products are being offered to the market for attention, acquisition

or consumption that may satisfy the need and want (e.g. packaging, promotional tools). In this

case products innovation is done to get the attention of customers and most especially the non-

customers market share of their competitors.

It is imperative for Puregold Supermarket, being in the merchandising industry, to offer

its customers with good quality products. They grow accustomed, should be maintained and

standardized, to keep the customers hooked and coming back for more.

Pricing also is an important to consider given that the largest target market of Puregold

Supermarket is considered to be price sensitive. Any sudden and drastic changes in price might

push the customers to find other grocery stores. And in the industry that Puregold Supermarket

is in, there are many others that can provide Puregold customers with other alternatives. It must
then be ensured that products of Puregold are priced in a way that highlights value at the same

time, still affordable to its customers.

RESEARCH METHODOLOGY

The researchers used different techniques in gathering information to support the study.

A. SURVEY

The proponents conducted survey among 400 respondents to get their opinion

regarding the establishment of PUREGOLD here in Talavera. These respondents came

from the total number of population of different barangays in Talavera, Nueva Ecija. The

survey was distributed among individual household and Sari-Sari store owners.

B. SAMPLING TECHNIQUES

The researchers used Random Sampling Technique to gather information from

the target market. Through the use of Sloven Formula, proponents came up with the

number of respondents which is 400.

Sloven’s formula:

N
n = 1+Ne ²

where:
 n=sample size

N =sampling population

e=margin of error

Computation for the sample size

The population of Talavera last 2013(latest) is 117,752 as total. To compute for

the sample size of this population we used a ±5 margin of error. Using Sloven’s

formula:

N
n = 1+Ne ²

117572
n = 1+(117572)±5 ²

=398.64

By using the Sloven’s formula we came up to the sample size of 399 respondents which

is rounded up but to increase our level of confidence we made it 400 respondents to be exact.

C. SURVEY QUESTIONNAIRE

In order to have an accurate information data, the researchers agreed to used

questionnaire.

The researchers used the check-list format. Questions are made for the

respondents in order to get their personal opinions and willingness regarding the proposed

project. The group provided 400 copies of survey questionnaire written in English language.
 D. INTERVIEW

The researchers interviewed relevant people who is relatively fitted to the study

in addition to the information gathered in survey questionnaires. It includes individual household

and Sari-Sari store owners.

E. RESEARCH

In conducting the study, the proponents used libraries, internet and websites as

an additional source of information for the project.

MARKET SEGMENTATION

SEGMENTATION
DEMOGRAPHIC LIFE STAGE GEOGRAPHIC PSYCHOGRAPHIC BEHAVIORAL

CHARACTERISTICS

Gender: Age: Individual Social Class:

Male, Female 15 – 55 years Household and Middle Class (C- Price

old Sari – Sari Store Class) and Lower Quantity

Education: owner Class (D-Class) Quality

All types of Status: operating in Convenience

educational Single, Talavera Lifestyle:

attainment Married, These are

Separated, individuals

Widowed whose

purchasing

decision is made

upon its personal

and family needs

and consumer

preferences in

terms of a Sari –

Sari Store

Buiness.

Personality:
 Housewife

Students

Employed

Unemployed

MARKETING STRATEGY

The most critical element of Puregold’s success will be its marketing and advertising.

Supermarkets or grocery stores serve the entire purchasing population of its geographical area

but focusing on customers who need to purchase items with lower cost and a wide variety of

commodities. In order to capture customers. Many of the initial customers will be drawn to the

unique nature of the store and will then have the opportunity to realize the cost savings of

Puregold. Puregold will also use Tarpaulin in its introductory stage as well as transit advertising,

which means the use of vehicles to carry the advertising materials for the customers to be aware

of the existence of the proposed business. Puregold will also reach out to different charitable

institutions such as orphanage, churches and organizations. Help will be extended to those

chosen charity by means of goods and financial help.

MARKETING MIX STRATEGY

PRODUCT STRATEGY
 Puregold Talavera engages in retail of sale of food and non-food products. It offers food

products such as dairy products, meat and sea food products, vegetables and fruits, beverages

such as wines and liquir, and other products used for personal consumption; and non-food

products including clothing, shoes, household chemicals, appliances, toys and sports items. These

food and non-food products are arranged in shelves corresponding to its uses and consumption.

PRICING STRATEGY

PLACE/DISTRIBUTION STRATEGY

Location is one of the major factors to be considered in starting up a business. It must be

assured that it is accessible to the target market. If location is later found to be incompatible to

the situation as to give consideration to its target market, it may lead the company to failure.

Right choice of location means reaching your target customers and you respond correctly to their

market needs. Puregold Talavera will be located in an open area at blank street, Matias, Talavera,

Nueva Ecija in front of the Basketball Court and beside Friendship Supermarket. (Kulang pa)

PROMOTION STRATEGY

 TV ADVERTISEMENT

Puregold will use TV Advertisement that could attract and encourage consumers to

patronize their products. One way to increase brand popularity is to use an effective endorsers.
Eat Bulaga host Vic Sotto and Joey De Leon are the endorsers of Puregold because they are well-

known comediennes and has the ability to portray different roles and characters effectively.

 BILLBOARDS/POSTERS/TRANSIT MEDIA/FLYERS

As a franchisee of Puregold, outdoor advertisement like billboards, posters, transit media

and flyers are taking considerations to grab attention of consumers and potential customers; it

can also be cost effective for it reaches thousands of people of Talavera on their daily basis, and

message is delivered continuously and frequently.

 SALES PROMOTION

Sales promotion is another tool used by Puregold in capturing the attention of their

customers such as giving up to 50% off products, promo packs and bonuses.

 RAFFLE PROMO

Raffle ticket is another way to urge thecustomers to buy products. Customer will purchase

an additional product until they avail a raffle ticket. This strategy has a great impact on the

company whereas it create an increase in demand of a product.

COMPETITORS PROFILE
MAIN COMPETITORS

›DIRECT COMPETITORS

I. CVC- An air-conditioned supermarket which has TV monitors endorsing their products inside

the store. They are offering different variety of products such as groceries, meats, fruits and

vegetables and some appliances. CVC have DFL (Definite Fun Lifestyle) inside the store in which

they are offering garments, accessories and other personal uses. One of their weakness is that

the most of their products are quite expensive.

II. Savemore Supermarket- An air-conditioned Supermarket with a wide and convenient to shop

commodities. They play quite music for their customers. It is also like one stop shop because they

are not offering grocery products but also vegetables, fruits, meats, fishes, appliances, garments,

cosmetics and they also have Watsons inside. They have a comfort room inside the building for

their customers, they are also offering different cards for discount. The said supermarket has

many customers because they offered variety of products. The groceries they offering is more

expensive than other grocery/supermarket near them.

III. Friendship Supermarket – Friendship are offering school supplies/ office supplies, toys/stuff

toys, furniture, accessories, garments, kitchen utensils, gadgets, and a little car toy where a kid

can ride it to the corner of the building. Friendship Supermarket is a second floor and have

elevator when you can go up and down. The size of it is wide but don’t have air condition. They

have many customers, because the price of their products is cheap. Some of the retailers bought

their commodities here to resale.

IV. Myra Grocery Store – Myra is not a supermarket but only a grocery store. The grocery store

is not too large in terms of space inside. Not too convenient to shop because they only have two

(2) counters and they only have few electric fans. They offered grocery products. Even thought

they have a little problem to their equipments or the satisfaction of the customers, they also

have many customers. It is compatible to those retailers who buy commodities or their business

because the price of their products is cheap.

V. 7MM Grocery Store – Some of the time, when we say grocery stores the customers are one

who get the products they buy. But in this kind of grocery store, they are the one who gives you

the products you want to buy because the customers are not allowed to go inside. The products

they sell is limited not like the others. They have only few customers. The price of their products

is cheap you would see this grocery store at the front of Friendship and beside 7MM Drugstore.

COMPETITIVE EDGE

Puregold is currently one of the largest and fastest growing hypermarket and

supermarket chains in the country. With the success of Puregold, competitors might decide to

replicate the company’s business model. Puregold’s current scale, extensive experience and

established brand name are some of the advantage over other players. Puregold focuses on

resellers; targeting the lower income segments.

BARRIERS TO ENTRY
 BARGAINING POWER OF CONSUMERS

The prices of the products and services have become the standard of how

consumers would want to spend on groceries. Anything above the price range

would be considered expensive, while anything lower would mean it’s cheap.

Most consumers think that the prices by the grocery stores are reasonable and

affordable because they offer value products and other pricing strategies. This just

goes to show that the consumers in this industry really do not have much

bargaining as they think they do.

 BARGAINING POWER OF SUPPLIERS

This force represents the power of suppliers that can be influenced by major

grocery chains and that fear of losing (influenced by major) their business to the

large Supermarket. Therefore, this consolidates further leading positions of stores

like Puregold in negotiating better promotional prices from suppliers that small

individual chains are unable. In return, Philippine based suppliers are also

threatened by the growing ability of large retailers’ source their products from

abroad at cheaper deals. The forces of competitive rivalry have reduced the profit

margins for Supermarket chain and suppliers.

 THREAT OF SUBSTITUTE PRODUCTS

Great substitution is able to reduce demand for a particular product, as there is a

threat of customers switching to the alternatives. In the grocery industry this can
 be seen in the form of product for product or the substitute of needand is further

weakend by new trends.

EXTERNAL ASSESSMENT

PESTEL ANALYSIS

Political Factors

For employment legislations, the government encourages wholesalers and retailers to

provide or mix of job opportunities from flexible, lower-paid and locally-based jobs to highly

skilled, higher paid and centrally-located jobs. Puregold Supermarket understands that

wholesaling and retailing has a great impact on jobs and standard living of people within the

community being on inherently local and labor-intensive sector. Puregold employs High School

Graduate that could be in qualified for the position such as cashier, bagger, clerk and others.

Political factors include possible difficulties in obtaining regulatory or local government

approvals and distributing or transporting inventories. Puregold also experienced difficulty in

building its brand and location. While the risk maybe substantial, PUREGOLD believes that the

risk are worth taking given its growth potential.

Economic Factors

Economic factors are of concern of PUREGOLD because they are likely to influence

demand, cost, prices and profits. Increase in unemployed people create decrease demand for
many goods, adversely affecting the demand required to produced such goods. These economic

factors are largely outside the control of the company, it affects food market, and are exposed

to market concentration risk. PUREGOLD overcome this economic factors by improving standing

living of people through employment.

Social/Cultural Factors

Filipino customers considered “one-stop” and “bulk” shopping, which is due to a variety

of social changes. Therefore, PUREGOLD increase the amount of non-food items available for sale

such as kitchen utensils, household appliances, and apparels. Also, the types of goods and

services demanded by consumers is a function of their social conditioning and they’re attitudes

and beliefs. These are the reasons why PUREGOLD focuses towards the own-label share of

marketing strategy which can drive costs of the business.

Technological Factors

Another major macro-environmental variable to consider is the development of new

technologies which have great benefit both in customers and the company: customer satisfaction

rises because goods are readily adapted new technologies such as Electronic Point of Sale (EPOS),

Electric Funds Transfer Systems (EFTPOS) and Electronic Scanners.

Environmental Factors

As a manager of a company, various responsibilities will occur, such as responsibility to

its employees, suppliers, and the company responsibility to its society. The major societal issue

threatening food industry has been environmental issues, a key for company to act in a socially
responsive way. PUREGOLD sets various regulation and corporate governance in order to

accompany this corporate social responsibility.

TECHNICAL STUDY

INTRODUCTION

OBJECTIVES

A. PRODUCT DESCRIPTION

PRODUCT NUMBER TITLE DESCRIPTION

1A Appliances

1B Furnitures

2A Linen

2B Soft and Hard Candies

Local Chocolates

Mallows/Jellies

3A Imported Cookies and Biscuit

 Local Cookies and Biscuit

3B Native Biscuit

Wafers

Pretzels

4A Local Snacks

Imported Snacks

4B Popcorn

Dried mangos

Raisins

5A Local Snack

Nuts

5B Canned Vegetables

Canned Fruits

Native Preserves

6A Canned Meat

6B Canned Fish

7A Instant Noodles

7B Cup Noodles

Soup

Pansit

8A Catsup
 Sauces

Pasta

8B Seasonings

9A Toys

Ladies Wear

Men’s Wear

9B Bags

Footwear

10A Baby Diaper

10B Adult Diaper

Alcohol

Feminine Care

Cotton

Baby Toiletries

11A Dental Care

11B Health Care

12A Bath Soap

12B Laundry

13A Household Maintenance

13B Tissue Disposables

14A Doy and Tetra Packed Juices

14B Canned Juices

Powdered Iced Tea

Powdered Juice

15A Creamer

Coffee

15B Choco Drink

Regular Milk

16A All-purpose cream

Culinary Milk

Cereals

Oats

16B Bread fill

A.1 PRODUCT PRICING

A.2 PRODUCTION/OPERATIONAL PROCESS

 MANUFACTURER

DISTRIBUTOR (INTERMEDIARIES

RETAILER

SARI-SARI STORE OWNER INDIVIDUAL HOUSEHOLD

A.3 FLOW CHART OF SERVICE

GREETINGS

ACCOMODATION AND PRODUCT SELECTION

FALLING IN LINE

PUNCHING THE PRODUCT

PAYMENT
 PROCESS FLOW DIAGRAM

STEP 1: Anyone who walks in by the store is considered as a customer and will be treated

special and welcomed by the employees with a smile and respect

STEP 2: Salesperson will accommodate the customer and will guide her to her destination

and tell her where she can get the product

STEP 3: After the selection of the products, the customer will fall in line to the counter

STEP 4: The cashier will punch the product

STEP 5: The customer will pay the price

STEP 6: After accepting the payment, the bagger will place the products according to the

customer wants, either a box or a paper bag

 B. BUSINESS PROCESS

The start of the store’s operation will be 8:00 am in the morning to 6:00 pm in the

afternoon, Monday to Sunday. The personnel and assigned salesperson must be on time, at least

thirty (30) minutes before the opening of the store.

C. BUSINESS LOCATION

C.1 Vicinity Map

C.2 Floor Plan

D. MACHINERIES AND EQUIPMENT

E. OFFICE SUPPLIES

F. STORE UNIFORM

G. UTILITIES REQUIREMENTS