Documente Academic
Documente Profesional
Documente Cultură
1
Author(s)’ Recommended Key Words
The Big O, doughnuts, snack food, yogurt, wheat, low calorie, doughnut industry
2
THE BIG O
LS126Q
Members:
Francis Apolinar
Jose Angelo Castro
Justin Gabitan
Kathrina Koa
Patricia Malabanan
Laurence Miranda
Byron Montiel
Lorenzo Nanagas
Scott Si
Stephanie Tornilla
Ryan Zamora
3
TABLE OF CONTENTS
Executive Summary
Appendix
5
Executive Summary
The Big O doughnuts
The Big O doughnuts are healthy baked doughnuts with sugar-free dips and yogurt
filling. The doughnut itself comes in two variants: Original and Wheat. These variants are
additionally flavored with sugar-free chocolate dip, and mango, strawberry, pineapple, or vanilla
flavored yogurt filling. The Big O doughnuts are low in calories and product variants have the
added benefits of wheat germ and yogurt. The Big O also offers flavored chocolate drinks in
strawberry and peanut butter variants as the ultimate complement to its healthy doughnuts.
The Big O is a playful brand name that immediately captures the attention of consumers
from the product’s target market, attracting them to The Big O kiosks and stalls serving high
quality healthy treats in a fast and friendly manner. The brand name connotes a certain fullness
and satisfaction that the company aims to provide its customers with a light, delightful feeling
that promotes the fun dynamically energetic aura of a healthy lifestyle among the Filipino youth.
The Big O doughnuts will be offered as a healthy alternative to current doughnut industry
offerings primarily targeting a niche market composed of students and young adults with excess
disposable income from the middle upper class of low A to broad B socio-economic classes.
These include teenagers, young professionals and other people in their twenties and thirties
residing in Metro Manila. They live active lifestyles and can often be noted to frequent malls,
bazaars, cinemas and gyms during their free time. These targeted consumers are attuned to the
growing health trend in the country and are greatly influenced by it. They are impulse buyers
who have the age and background to appreciate the joys of doughnuts.
Financial Features
The Big O aims to generate Php 122,000 in sales revenues for the first trimester of
operations. Furthermore, the business has an average profit margin of 35%, making it a profitable
venture from the get-go. The business will be financed solely by the owners’ capital. Total initial
investment required is estimated at Php 5,000 per member, or Php 55,000. The table below
details the initial investments.
6
Initial working capital of PhP PhP 55,000.00
5,000.00 per member
SEC filings, business registration, and 1000.00
similar procedures
Market testing and product sampling 1000.00
Advertisement 1500.00
Equipment maintenance 1000.00
Transportation 1500.00
Stall 10000.00
Purchases (Initial Supplies) 32500.00
Rent Deposit 6500.00
Total Initial Expenditures 55000.00
Major Achievements
The Big O is confident in its product offerings as the company has received highly
encouraging, positive feedback from random product sampling sessions conducted over the last
three months. The Big O is enthusiastic about its future in the doughnut industry in the months to
come. The following table details the objectives and sustainability of the product.
Time frame Objectives
Year 1 – Successful entry The Big O Doughnuts will be launched in Ateneo and free samples
into the market will be given to potential consumers.
Participation in school bazaars and outside events.
Year 2 – Expand to wider Increase promotions to reach wider audience.
customer base Adding new flavors to suit the variety of preference in the expanded
market
Catering services for parties, university and corporate events.
Open up our own permanent stall in a school or office cafeteria.
Year 3 – Extend product More flavors for the existing product line.
line and capacity New healthy product line of other desserts and healthy sandwiches.
Increase distribution networks through good client and supplier
relationships.
Pour in retained earnings to optimize production processes
Open up a stall in a high-traffic mall.
Year 4 – Expand stalls to Open up more stalls in malls and food courts
other venues, open up a Expand to a café type setting for one branch of The Big O
café Doughnuts
Year 5 – Franchising Open up more stalls in malls and food courts
options and higher market Expand to a café type setting for one branch of The Big O
share Doughnuts
The fast-food market has grown rapidly over the past ten years with a proliferation of local and
foreign establishments. This has been spurred in part by a relaxation of restrictions on foreign
entrants and by the slow but steady rise in per-capita GDP of about 1.4% per year over the past
decade, according to the World Bank. Food consumed outside the home has risen steadily from
3.8% of total family spending in 1991 to 4.9% in 2000, according to government figures, a jump
from 24.6 billion pesos in 1991 to 89.2 billion pesos. The chart below shows the market value
each classification.
The most popular fast food establishments in the industry are those under the restaurant
sector serving food such as hamburgers, chicken meals, pizza and ethnic food. But when it
comes to the side of the industry that leans towards the snack portion of consumerist diets, in
other words the baked goods portion of the industry, the pack is being lead donuts. Donuts are
undoubtedly one of the country’s favorite snack foods as the proliferation of donut shops in the
country today shows. Brands like Dunkin Donuts, Go Nuts Donuts and more recently the Krispy
Kreme Donuts, have gained a steady following. More recent entrants include those developing a
8
mini-donuts sub-sector in the industry such as the competitor Lil Orbits. DPI reckons the
doughnut market in the Philippines is worth about 3.8 billion to 4 billion pesos a year.
Taking note of the figures in Table 1 we see a fairly stable level of expenditure by the
average Filipino consumer on food and non-alcoholic beverages within the 1990-2015 period.
The highest percent of spending (nearly 40% of total expenditure) is directed towards this
category, under which The Big O falls. These expenditures are expected to amount to a total of
beverages
tobacco
services
medical services
Misc goods and services 11.87 11.89 11.90 11.05 10.67 10.29
Though minimal concrete data on the industry is available, the doughnut industry in the
Philippines is of an arguably respectable size and as can be seen by the brisk business
being done by current competitors in the industry, a rather attractive one. Despite the
many competitors within the present day industry, it remains an appealing venture for
that others cannot. The market is currently characterized by stiff competition among
the various competitors in the industry for whom no significant differentiation exists
other than in the matters of taste and price. The Big O intends to base its
doughnuts: health. The product endeavors to set itself apart from competitors
The Philippines is one of the countries with exceptionally high sugar consumption. This
can mostly be attributed to the inherent Filipino sweet tooth and the success of the fast food
culture within our heavily westernized society. Given the levels of intake as illustrated in figure
2
Ibid.
10
2, Filipinos are more prone to obesity and diabetes as well as certain other chronic-dietary
diseases that have been gaining recognition as a danger to health in recent years.
According to WHO, by 2030, it is expected that most of the diabetic sufferers would be
living in Asia with respect to the rising diabetic rates. India is the biggest home to the diabetics
housing 33 million cases, China with 23 million cases, and Pakistan and Japan with 9 and 7
million cases respectively. Health indicator statistics from the DOH have pegged diabetes as the
ninth leading cause of death in the Philippines. There are an estimated 3.36 million suffering
11
from the disease today, meaning that 1 out of 25 Filipinos are affected by diabetes. 3 The
Resulting in high blood glucose rates, diabetes is often seen to affect the eyes, kidneys,
nerves, and heart that would eventually lead to acute and chronic complications such as loss of
vision, kidney failure, amputations, and heart disease. These health problems will adversely
affect the quality of life as well as increase the health care progress and might thus decrease the
Obesity, on the other hand, impedes on the work productivity of the employee.
Overweight and Obesity are clinically defined as having a Body Mass Index (BMI) over 25 and
30 respectively. Obesity significantly increases the likelihood of health problems such as type 2
diabetes, high blood pressure, high cholesterol and triglycerides, coronary artery disease (CAD),
stroke, and sleep apnea. These and the added stigma attached to body image problems also
One of the 25 global consumer trends in 2008 is “a focus on health and wellbeing but
with a parallel growth in obesity” as predicted by Euromonitor International. Many Filipinos find
themselves subscribing to this trend and respond well to products labelled as healthy despite
having a higher price tag. 5 Many young people today enroll in gyms and follow a diet to live
healthier and to have a better body image. data gathered from the NUTRISTAT Protocol at St.
Luke's Medical Center (1999 - 2000), states that 34% of the total admitted patients are
3
Bio-Medicine.org. Diabetes on the rise among Filipinos.[http://www.bio-
medicine.org/medicine-news/Diabetes-on-the-Rise-among-Filipinos-15022-1/] Accessed: July 3,
2009.
4
Jane C. Baltazar et. Al. Prevalence and correlates of diabetes mellitus and impaired glucose
tolerance among adults in Luzon, Philippines.
[http://www.journals.elsevierhealth.com/periodicals/diab/article/PIIS0168822703002821/abstract
] Accessed: July 4, 2009.
5
"Consumer Lifestyles - Philippines." (2005): Euromonitor International. [Database online.] 04
May 2005.
12
malnourished and rouhly one-fourth of them are obese. There was more overweight (2/3) than
undernourished (1/3) patients6. FNRI data from 1998 reveals an incidence of overweight and
obesity in the Philippines of 16.9%. Coupling this information with the established steady
growth of the fast food industry and the lifestyle it encourages, the current estimates of
Population deaths
1. Heart diseases 84.8 17.6
2. Vascular system diseases 61.8 12.8
3. Malignant neoplasm 48.5 10.1
4. Accidents 41.3 8.6
5. Pneumonia 38.4 8.0
Cardiovascular conditions, diabetes and obesity have become a primary concern in the health
industry today. All three—and as chronic-dietary diseases, the last two in particular—are directly
correlated with personal choices of nutrition and lifestyle. Alteration of these personal choices
has an impact on these conditions. In addition to all this, young adults, aged 20-29 and with a
such external sources (such as those derived from work, home, traffic, etc.). 8 These rising
directly diet related health issues in the country today are prompting Filipinos to watch what they
6
Asian Bariatrics. “Morbid Obesity presents clear and big risks to our health, Filipino experts
say.” http://asianbariatrics.rxpinoy.com/new_challenge.html. Accessed August 3, 2009.
7
Rosa Allyn G. Sy. “Prevalence of Obesity in Medical Practice in the Philippines”.
http://www.iotf.org/oonet/philippines.htm. Accessed: August 2, 2009.
“Beating Obesity”. Philippine Daily Inquirer. June 14, 2008.
8
"Street Stalls/kiosks - Philippines." (2008): Euromonitor International. [Database online.] Feb
2008.
13
eat and makes the need for healthy versions of all time favourites such as The Big O quite
prominent.
A. Business Concept
The Big O doughnuts are healthy baked doughnuts with sugar-free dips and yogurt
filling. The doughnut itself comes in two variants: Original and Wheat These variants are
additionally flavored with sugar-free chocolate dip, and mango, strawberry, pineapple, or vanilla
flavored yogurt filling. The Big O doughnuts are low in calories and product variants have the
added benefits of wheat germ and yogurt. The Big O also offers flavored chocolate drinks in
strawberry and peanut butter variants as the ultimate complement to its healthy doughnuts.
The concept will make money through selling not only the doughnut itself but the
experience of eating a sweet, guilt-free treat. The doughnuts will be sold per piece, or in boxes of
three and six. The fruit-infused chocolate drinks will also provide additional revenue, as with the
combo treats that come with offering doughnuts and drinks together. Franchising will become an
option in the future once brand image has been established. This model can be sustained, through
aggressive marketing strategies, which highlight the stall as the first to offer doughnuts in a
The Big O is a playful brand, promoting a fun, full and satisfyingly healthy
lifestyle. This playful and fun image is a direct attempt to appeal to the target market. It is short
and catchy, reinforcing the statement the company wishes to make with its products: That health,
14
goodness and fun can mix. The company will be living proof that health and indulgence are not
mutually exclusive. It is not necessary to give up the benefits of living and eating healthy and
the joys of a sweet treat at any time of the day. The Big O does not want their consumers to have
B. Customers
. Given that the unique thing about The Big O is its healthy nature the product will be
marketed to a segment of the population that appreciates and seeks out this quality. The company
has identified teens and yuppies (young professionals or adults in their 20’s and 30’s) in the
upper middle class of low A to broad B as the most receptive to The Big O. The company targets
both males and females though the latter is generally more conscious of diet nutrition and image.
It is this demographic that is most attuned to the growing health trend and has the disposable
income to pursue premium products directed towards this purpose. (Euromonitor International)
The target market is geographically situated within Metro Manila and is concentrated in
universities, business districts and call centers. They also frequent malls, after school hangouts
and bazaars. The older members of this segment have also taken to frequenting gyms to live
healthier and build a positive body image.9 The typical customer for this product will include
active, health-conscious students and young professionals looking for an alternative guiltless
snack and doughnut consumers looking to shift to a healthier snack that still fulfills their hunger
cravings.
As with every business venture certain risks are involved. One of the biggest risks that
the company faces is entering an industry with such high levels of competition. There are certain
9
"Consumer Lifestyles - Philippines." (2005): Euromonitor International. [Database online.] 04 May 2005.
15
difficulties encountered when penetrating a market with so many direct and indirect competitors
present. Among the direct competitors are Dunkin Donuts, Mister Donut, Go Nuts Donuts,
Krispy Kreme, as well as smaller competitors like Cellos, Happy Haus Donuts, Hot Loops. All
other pastry products or sweet food items are taken as indirect competition for those consumers
just looking to get their “fix” and fulfill the basic need of food and craving satisfaction.
Penetration of other new firms in the industry, given low capital requirements and
normally low switching costs to consumers, is another main concern that The Big O faces. With
all these competitive offers the company maintaining customer loyalty becomes of high value.
The Big O’s response to these threats is in the strengthening of its position as a healthy
alternative offering what no other doughnuts can. In line with this continuous product
development is needed to ensure that offerings continuously surprise and delight the customer.
.The next major risk that the company faces concerns its limited capital. Increasing rent
rates in bazaars and for stalls pose a notable risk for the company. This calls for careful
deliberation on stall location and which bazaars the company will participate in. Access to the
taret market through these selections is vital to ensuring the maximization of the portion of
Additionally the company must ensure the stability of its supply source for raw materials.
Despite the fact that doughnuts are basically made from commodity products, quality of certain
key components is still crucial. External economic forces and fluctuations in supply may affect
the price and availability of these ingredients and affect the profitability of the firm. The only
remedies for this exist in strong supplier relations and contigency plans..
16
There are four major considerations that are crucial in establishing the success of The Big
O. The First key success factor is the health and wellness trend which the company uses as the
foundation for The Big O doughnuts. With the growing concerns of diet related illnesses and the
stigma proliferated by the media attached to being overweight, consumers are becoming more
conscious of their health and are beginning to look for products that will fulfill their wellness
needs. The Big O believes that catering to this health trend will infuse something new and
exposure. Because this kind of product is unheard of in the industry the firm must create
visibility and awareness to attain higher sales. This is also necessary for the firm to establish a
differentiation between its products and those currently available in the industry. It also enables
the firm to penetrate the minds of their target consumers and entice new customers.
Quality and Affordability are important, linked considerations. As consumers today are
much more difficult to please, a product has to provide both quality and value for money to
succeed. This can be achieved through thorough and efficient operations and is of great
importance as these factors can increase customer loyalty and repeat purchases.
It is also important for The Big O to offer rich variety through product innovation to
satisfy the aggressive demands of the present day consumer. Product development must be
geared towards producing flavors and variations that appeal to the target consumers as well as
the cultivation of different product lines for the future. Such expansion is not restricted to
doughnuts but also covers drinks sandwiches and possibly even full meals.
E. Feasibility
The doughnut industry is currently in the mature stage, and with the number of
competitors rivalry is very high. There is a low bargaining power for suppliers because the
ingredients are mostly commodities. There is a moderate bargaining power for consumers which
17
was lowered by the pioneering vision of The Big O as the first healthy donuts in the country.
However, there is a very high threat of substitutes for sweet products such as other doughnuts
and pastries since consumers have a myriad of choices facing them when buying sweet snacks or
desserts. A more detailed analysis can be found in the Porter’s Five Forces analysis in the
appendix section.
The newcomer can only succeed by offering something radically new that can shake up
the market. Even if the donut industry is already very competitive, many consumers shy away
from the current donut products because of the high sugar and fat content. It is this segment of
the market that the company wants to tap. As for high threat of substitutes, this can be combated
as long as the product delivers great taste and good value for the customers. Upon entry of the
The Big O into the market, it offers something unprecedented in the donut industry – a menu
revolving around a line of healthy doughnuts. The business will thus rally on its first mover
Going into this business is attractive and reasonable because there is an opportunity in
filling the void of the healthy doughnut market. Although there are some baked/healthy variants
for the doughnut sellers today, no doughnut company has yet positioned itself to offer primarily
to the health conscious. The fruit-infused chocolate and coffee drinks are also new products that
could appeal to the market. Furthermore, going into business is also attractive since the group
has connections with skilled pastry bakers and the central office of Mister Donut.
The trend towards and subsequent proliferation of food stalls and kiosks shows a
particular characteristic of the Filipino consumer as an impulse buyer and is something that the
company intends to exploit. In the Philippines, “food and drink offerings are still based around
impulse foods such as fried menu items, pastries or ice cream, which are mostly sought by
18
consumers to indulge themselves when on the move”. 10 Establishing the business in a kiosk type
of set up would help cater to this particular consumer buying habit and offer a convenient avenue
for product purchase. Stalls and kiosks are also highly customizable, which presents further
opportunity to pull in consumers with fun looking, attractively designed stalls. Due to the smaller
scales stalls also require much lower financial capital input than a full sized café or store.
Market feasibility has been ascertained through the positive overall reception of
the product in the surveys and focus group discussions conducted over the past three months.
The strong demand for healthy products as dictated by the current trend also drives the salability
of the product. Technically speaking these healthy doughnuts are feasibly produced as will be
discussed in detail in later parts of the paper. Instead of frying the doughnuts, they will be oven-
baked and this has already been done by one of the group members. The use of sugar-free
sweeteners and wheat as key ingredients is proven by extensive research. The only operational
challenge for the product is the storage and maintenance, including the shelf life of the raw
materials and work-in-progress. Financially, this business is also feasible since it does not require
heavy capitalization, and can be started in a small, stall set-up scale. Details for feasibility will be
Vision/Mission/Objectives
Mission
Golden Halo Inc. strives to give the best combination of health, great taste, and affordable
convenience in our products. We will provide the highest customer satisfaction for health-
conscious sweet lovers by providing them with excellent products and service that cater to their
10
"Street Stalls/kiosks - Philippines." (2008): Euromonitor International. [Database online.] Feb 2008.
19
needs. Through constant innovation, we will transform guilty food into guiltless delights. As the
pioneer of healthy donuts, we will come up with a wide variety of forms and flavors which will
Vision
Guiltless eating pleasure will become synonymous with our company and our products. Our
products will be recognized as the best value for their excellent quality and value. We will be the
healthy sweets of choice for the people. Our customers will feel light and delighted whenever
they consume our products. We will be among the top five donut shops in the country within
eight years.
Objectives
The company will be pursuing its strategy based on the objectives set by a five year plan. The
following goals and objectives within the stipulated time frame will guide the company in its
envisioned direction.
Table 3: Objectives timeline
Time frame Objectives
Year 1 – Successful The Big O Doughnuts will be launched in Ateneo and free
entry into the market samples will be given to potential consumers.
Participation in school bazaars and outside events.
Year 2 – Expand to Increase promotions to reach wider audience.
Adding new flavors to suit the variety of preference in the
wider customer base
expanded market
Catering services for parties, university and corporate events.
Open up our own permanent stall in a school or office
cafeteria.
Year 3 – Extend product More flavors for the existing product line.
New healthy product line of other desserts and healthy
line and capacity
sandwiches.
Increase distribution networks through good client and
20
supplier relationships.
Pour in retained earnings to optimize production processes
Open up a stall in a high-traffic mall.
Year 4 – Expand stalls Open up more stalls in malls and food courts
Expand to a café type setting for one branch of The Big O
to other venues, open up
Doughnuts
a café
Year 5 – Franchising Open up more stalls in malls and food courts
Expand to a café type setting for one branch of The Big O
options and higher
Doughnuts
market share
A. Value Proposition
The doughnuts being sold in the market today are traditionally fried and respond to the
Filipino’s natural craving for sweet snacks by layering on thick coats of sugar and artificial
flavoring resulting in a high calorie product that though quite delicious, can be detrimental to
your health. With the rising trend towards health-consciousness, consumers find themselves torn
between caring for their bodies and satisfying their desire for tasty treats. The Big O offers them
a solution by providing a healthy alternative to the high calorie doughnuts available in the market
Value Statement
The Big O Doughnuts aim to encourage a healthy Filipino lifestyle by offering their
consumers a healthy way to enjoy their doughnuts. These doughnuts encapsulate delightful
Product
21
Golden Halo Inc. fills a void in the market with The Big O Doughnuts: a deliciously
healthy alternative to the high-calorie doughnuts being sold by all the other doughnut
establishments in the country. The product will be marketed as a better, healthier alternative to
the popular but fatty donuts abound in the industry today. The Big O Doughnuts offers low
calorie treats with even healthier variants. Through the use of yogurt, wheat flour (whole and
enriched), and sugar substitutes, The Big O gives provides its patrons with more health benefits
and fewer calories. The doughnut dip and fillings come in a variety of delightful flavors such as
chocolate, mango, strawberry, pineapple, and vanilla. The special formulation of these doughnuts
result in a tasty bite of health will keep The Big O customers coming back for more.
To cater to the discriminating needs of the company’s target market, The Big O
Doughnuts will also be offering customizability options for the doughnuts that customers
purchase. The stalls will have a dips selection consisting of the mentioned yogurt flavors and
chocolate dip which would allow our customers to mix and match flavors for a more satisfying
doughnut experience.
Aside from the core product that is doughnuts, The Big O Doughnuts will also offer
drinks that will enhance the dining experience of its customers. It will offer hot or cold chocolate
drinks infused with strawberry or peanut butter. These drinks will be offered as standalone or
combo purchases in order to give better value to customers. The pervading and unifying themes
of all the products will be the low calorie aspect, the fun, dynamic flavors and the healthfulness
22
Low calorie content
Calories are a unit of measurement for energy. The recommended calorie consumption
for an average adult is estimated at 2700 for men and 2000 for women. Though calories are
needed by the body to function an excess intake of calories that cannot be burned in one’s day-
to-day activity leads to weight gain and in extreme cases obesity. The health implications of
being overweight are well known and include: heart diseases, stroke, diabetes, high blood
pressure, sleep apnea, osteoarthritis and even certain types of cancer. By limiting sugar content
through a mediated isomalt-sugar mixture and using only the best healthy ingredients, The Big O
Doughnuts are lower in calories than other doughnuts in the market. Studies show that in
addition to avoiding weight gain and its subsequent health problems, low calorie diets have the
Whole wheat flour is a type of flour retaining the bran germ that are usually discarded in
the processing of regular white flour. Wheat germ is a veritable source of nutrients including B
vitamins, Calcium, Fiber, Iron, Magnesium, Manganese, Omega-3 fatty acids and Vitamin E
among other things. These nutrients (including phytosterol which lowers cholesterol and benefits
the heart) produce such benefits as lowered blood pressure, aids in nervous system functions, and
reduces risk for type 2 diabetes. The high fiber content of wheat flour also improves
gastrointestinal health, reduces the risk of heart disease and prevents weight gain 12. By using this
type of flour for its wheat variant, The Big O Doughnuts pass these benefits on to their
consumers.
11
Jim Dryden. Heart benefits from a low-calorie balanced diet. http://www.medicalnewstoday.com/articles/36124.php. Jan 14, 2006
12
Jennifer Murray. Nutritional Benefits of Wheat Germ. Feb 17, 2009
23
Yogurt Dips and Fillings
Yogurt is a fermented dairy product made by adding bacterial cultures to milk, which
causes the transformation of the milk's sugar, lactose, into lactic acid. Yogurt is a viable source of
calcium for lactose intolerant individuals and in fact has even higher calcium content than milk
due to the actions of the bacteria culture. In terms of nutritive content yogurt is considered a
good source of protein, calcium, riboflavin zinc, potassium, protein, and B vitamins (B2, B5,
B12). Additional health benefits of yogurt stem from its “probiotics.” Health benefits of yogurt
include boosts to the immune response, improved digestive health, promotion of burning of fat
and building of bones and reduce the risk of high blood pressure13. Glazes and fillings present the
highest concentration of sugar in most doughnuts but in The Big O Doughnuts it becomes a
Market Segment
. The chosen target market is composed of discerning, health conscious individuals who
experience an underlying conflict between their health concerns and desire to indulge. These
consumers are constantly looking for healthy versions or alternatives to their favorite products.
13
Elaine Magee. The Benefits of Yogurt
24
The company has identified teens and young professionals from the upper middle class as most
fitting the chosen profile. As having the background to appreciate doughnuts and the privilege to
prioritize their health, these low A to broad B consumers are the most receptive to the benefits
offered by The Big O and the most likely to pursue products of its nature. The firm targets both
males and females though the latter is generally more conscious of diet nutrition and image.
The target market is geographically situated within Metro Manila and is concentrated in
universities, business districts and call centers. They also frequent malls, after school hangouts
and bazaars in their spare time. The older members of this segment have also taken to
standards these consumers are attentive to new offerings in the market and are adventurous
enough to try new things particularly if they appeal to their sense of health and wellness. They
will choose to pay special attention to products that cater to their busy on-the-go lifestyle and
impulse buyer nature. More often than not they will choose items that are delicious, filling and
easy to eat. The company makes use of the focus differentiation strategy by addressing the needs
Competitive Strategy
endeavoring to establish itself as a unique player in the industry with a new revolutionary
product. The firm aims to provide their target customers with benefits that are currently not
offered in the current product offerings of the industry. These healthy doughnuts cater to a void
in the industry creating a special need driven by today’s consumer’s demand for high quality
products that cater to their dreams of health and wellness without sacrificing the pleasure of a
14
"Consumer Lifestyles - Philippines." (2005): Euromonitor International. [Database online.] 04 May 2005.
25
tasty snack This has come to the industry in line with the recent health trend. The Big O believes
that offering this kind of value in the industry will reap returns in the form of consumer’s
willingness to pay premium prices for our product. The focus strategy comes into play in
recognizing that we are catering to a very specific group of health conscious consumers.
However the company aims to expand its base and capture even the not so health concerned
individuals through the quality of their product and proper spread of information to aid in
A. Target Market
The target market can be easily illustrated through four segments. Summary of Consumer
Demographic
The Big O will be targeting consumers ranging from 18 to 35 years old, both male and
female, who are either college students or working professionals. These consumers have
Geographic
The target customers live in Metro Manila, primarily in universities, business districts,
malls, and call centers. However, the early stages of the business will focus on Ateneo,
26
Psychographic
targeted. They also have to love sweets, particularly donuts. These people are
adventurous enough to try new things but responsible enough to care about their welfare.
Behavioral
Busy, stressed and constantly on-the-go, the target consumers will look for something
that is delicious, filling, and easy to eat. They have no time or space to eat full, balanced
meals; hence they resort to unhealthy snacks and sweets. The healthy fruit donuts will
Bulls Eye Target - Active and Health-conscious College Students and Young Professionals in
a) Lienne Chai represents the image-conscious, active and overworked college student. She
University. Because of the heavy load of her academics and extra-curricular activities, she
often gets stressed out. As a busy college student she often resorts to quick snacks and
unhealthy sweets including doughnuts. Lienne is a closet doughnut lover, loving the
sweetness of this guilty pleasure but hating the thought that every doughnut she eats goes
old entrepreneur trading toys and candies. He loves to search for the latest trends in food,
business, and technology, and counts himself as a discriminating customer. Although he loves
to eat, he always takes caution because he comes from a family of diabetics. His love for
27
sweets takes a backseat in favor of his priority that is his health. He is on a constant lookout
for food that will both satisfy his cravings and benefit his health.
POSITIONING
Identified Marketing Opportunity
Upon entry of The Big O product into the market, it offers something unprecedented in
the donut industry – healthy donuts. The Donuts have the image of being fat and unhealthy, but
this product aims to reinvent the image of donuts from a guilty pleasure to a guiltless delight.
Although there are some baked/healthy variants for the donut sellers today, no donut company
has yet positioned itself primarily on the health aspect. Furthermore, the core product of donuts
will be reinforced with the fruit-infused chocolate drinks. The company will employ the focus
differentiation strategy to address the specific needs of health-conscious or even diabetic sweet
lovers.
o It will position itself as the first healthy donuts in the country, while employing focus
unfavorable effects.
o Unique Selling Proposition: “From a guilty pleasure to a guiltless delight.”
o Slogan: “The healthy doughnuts that make you go O!”
o The positioning of the company is made in a way that will first register the idea of a
great-tasting donut in the minds of the consumers before we will introduce the idea of a
28
o It concentrates on the upper end of the middle-priced market, being more expensive than
regular doughnuts such as Mister Donuts and Dunkin Donuts but being careful to remain
below the price ranges for other premium doughnut competitors such as Krispy Kreme.
PRICING
The pricing strategy of Healthy Fruit Donuts is based on market-oriented pricing with the
Combo pricing will also be employed. Drink+donut combos will also be introduced, as
with half dozen and one dozen orders. This will provide more options for the customers.
More detailed costings are found in the operations section of the paper.
SALES POTENTIAL
Upon the start of operations and up until the short term time frame, the company might
find it hard to make a noticeable mark in the whole doughnut industry and to pose a big threat
against its major competitors due to its limited operational capacity and geographic reach as a
small start-up company. However, the company firmly believes that its products will slowly but
29
surely gain acceptance and recognition by offering something unprecedented that addresses a
The company strongly believes that its products have a very big potential because it will
capitalize on Filipino’s love for sweets and the market’s need for a healthy alternative which
makes the company’s oil-free and sugar-free doughnuts a strong viable option. Consumers will
now have a choice as they could give in to their sweet cravings without jeopardizing their health.
This potential coming primarily from the health aspect provided by the products will be
intensified once consumers know that the company is the first doughnut company to offer a full
Aside from the health aspect, the product’s main success drivers will be its taste and
appeal to consumers. These two product characteristics, taste and appearance, will also play a
vital role in determining the product’s sales potential all throughout the product’s life cycle. Its
physical appearance will attract consumers to try the product while its taste will keep consumers
on buying the product more and more. Therefore, it is important for the company to employ
quality control processes to ensure that the products are produced within company quality
PROMOTIONAL PLAN
Upon its entry, the company will aggressively introduce and market its products and
brand name as the first healthy doughnut company in the country. The company realizes that its
successful entry and sustainability in the market heavily relies on its ability to effectively create
product visibility, brand awareness and brand equity. Given the limited budget constraints, it will
have to do with readily available resources to promote and make its product known to its
The product’s packaging, displaying the product name and logo, is one simple way of
establishing brand equity and recall in the mind of the consumers. Attractive packaging also
serves as free advertisement striking curiosity and proliferating brand image (figure 2). For per
piece sale transactions of less than three doughnuts, packaging will come in the form of
environmentally-friendly paper bags while three and half-dozen purchases will be packaged in
boxes for convenience. The flavored chocolate drinks will come in styrofoam cups of various
sizes.
The company will also utilize the Internet through various social networking websites
such as Facebook, Multiply and Yahoo!groups to further introduce and market the company
brand and its products. Since the company will initially start its operations inside the University
targeting Ateneo students, online marketing will be an easy and economical way of information
dissemination and product advertising especially when the chosen target market is very familiar
31
with and has access to such technological advancements. From first degree relations, friends to
friends and family to family associations, this can work all the way out to higher degrees of
relations and can spread through word of mouth therefore reaching a greater number of the target
market.
Events
The company will also take part in different events and bazaars inside and outside the
school campus wherein the target market can be reached. It will create partnerships with different
organizations inside the University to provide food and drinks during their general assemblies or
just even conduct product sampling to establish product visibility and brand awareness. It can
also join other food bazaars in different schools and geographic areas especially during
Christmas season and the New Year to penetrate into the market even further.
Flyers/Posters
Flyers and Posters can also be an effective promotional tool for the company. Creatively
designed and informative in content, they will be given away during events and bazaars to strike
curiosity among potential customers and entice them into trying and buying our food products.
This will help in creating awareness among and disseminating information to consumers on what
the company and its products is all about. The design of the posters emphasize a fit, healthy
lifestyle while emphasizing the Big O brand through the attractive models and sumptuous
donuts.
DISTRIBUTION
Distribution channels will be simplified and targeted, especially for the initial phases of
the operation. The company intends to sell in kiosks spread out through the University (similar to
Figaro and the calculated placement of vendo machines). This allows not only the emphasis of
32
our product being a healthier and equally delightful alternative to buying manufactured sweets in
vending machines (like Pillows), but also the increase in visibility and brand awareness.
Other than this, partnerships with Ateneo’s student organizations are the best choice for
the company early on to improve brand equity, brand awareness, and product visibility. Product
sampling can be done for these organizations’ small-scale projects (such as 1.5 hr seminars
intended to immerse applicants into organization’s culture and key functions) that restrict 30 or
more students to one location for a given period of times allows us to exploit short term captive
markets. With a heightened probability of taste-testing the product, brand equity can be built
Product selling in these organization’s large-scale events and bazaars such as LFC’s
Under the Stars project, AMA Mall, Celadon Week, AMA Bazaar, can also be pursued as
distribution channels. Furthermore, the company will participate in outside food bazaars.
Partnerships with organizations and the installment of kiosks beyond the scope of Ateneo
will also spread visibility and increase brand equity once the company has reached a sufficient
In the long-term, the company hopes to establish its own stall in a high-traffic area near
the target market like the university belt or call center areas in Ortigas and Eastwood.
33
Projected Market Share
There are four major competitors in the doughnut industry, Mister Donut (19% share),
Dunkin Donuts (14% share), Gonuts Donuts! (11% share), and Krispy Kreme (12%).
Overall, 56% of the total market share is dominated by major competitors in the industry, with
the remainder captured by multiple firms. Keeping this in mind, it is hoped that the company is
capable of acquiring 0.11% of the market share by the end of year 1. On year 2, this is expected
The market share is derived from appropriation of the growing health trend, the target market’s
perception of quality taste of the product, the market shares of the established donut sellers, and
the current growth rate of the industry. Market share acquisition has been conservative due to the
Krispy Kreme.
V. Competitive Analysis
Bakery products fast food grew the most in sales value terms with a rate of 11% in 2007 and
11.6% in 2008. This growth pushed sales value to more than P4 billion from different outlets
34
across the Philippines. Most of the sales come from normal bakery stores, with doughnut stores
such as Mister Donut and Dunkin’ Donuts increasing in popularity as this has become a common
dessert and an easy way to fill an empty stomach. Filipinos like doughnuts to the extent that an
enormous number of independent doughnut producers have entered the market in the last few
years. Among them are Go Nuts doughnuts and Krispy Kreme, which are priced higher than the
two brands mentioned above. For a more detailed reading of the competitor’s SWOT, see
Out of the total 3% market share held by Chained Bakery products fast food and another
3% by individual bakery products fast food, the following are the major competitors playing
1. Dunkin Donuts
Dunkin’ Donuts is known and loved around the world for quality menu items and an
unrelenting commitment to customer service. Their customers are passionate about the
Dunkin’ Donuts experience because they can expect a consistently superior product delivered
fast and at a great value and their lives would feel empty without a cup of their daily Dunkin’
Donut coffee. In fact, Dunkin’ Donuts has been ranked No. 1 for customer loyalty in the
“Coffee and Doughnuts” category in Brand Keys Customer Loyalty Engagement Index for
2. Mister Donut
one of the fastest growing fast food chains with over 700 outlets which include its innovative
tie-ups with 7-Eleven, Shell Select, Petron and other convenience stores, petroleum outlets
and shipping lines nationwitde with future potential franchisees that are ambitious and
dedicated.
3. Go Nuts Donut
36
Go Nuts Donuts’ firm belief that despite the “saturation” situation in the doughnut
industry marked by multinational companies, the doughnut sector was asking for a new face,
new products, and a new taste. Therefore, the company’s first step was geared towards
“market research programs such as test panels, consumer tests, and even disguised selling to
put the product through several trials” ending with fun-designed, “melt-in your-mouth”
donuts.
4. Krispy Kreme
Its founder started working in the doughnut sector by selling the doughnuts in his bicycle,
thereby yielding critique conclusions that the owner was able to understand the hardships and
limitations of sending one’s products to and fro. This brought the understanding of keeping
the trade secrets close to heart and try working in the respective departments themselves to
better understand the employees’ incapacity to work. Their motivation to keep on pushing
their product is through the belief “half of our business is done in the AM and the next half in
the PM. So in the morning, we compete with anyone in the breakfast business. In the
5. Hot Loops
Hot Loops is part of the Robina Corp. which is also its source for raw materials. The
name is quite literally put. Hot signifies the freshness of donuts as it is delivered to store outlets
fresh from the fryer, freshly frosted, and topped with mouth-watering, irresistibly aromatic
flavors. Loops refer to the ring shape that is typically associated to donuts. At the start of its
operations in 2004, Hot Loops offered nine distinct flavors designed to tickle the taste buds of
Filipinos everywhere.
37
6. Happy Haus
Happy Haus Donuts is one of the fastest growing donut franchise companies in the
country today. From its inception in 2005, it currently has some 400 franchise outlets mostly in
Luzon and Greater Manila Area, and the number continues to grow. Their winning strategy of
marketing low-priced high-quality donuts has proven to be a big hit among budget-conscious
consumers. Happy Haus Donuts is also a hit with franchisers because of their attractive
franchising schemes such as the Happy Haus Donuts and Coca-Cola agreement to give Filipinos
If the inflation experienced in early 2008 continues, costs will shoot up, and will
therefore increase the prices of products from fast food chains. In addition, the world recession
is believed to majorly hit the Philippines by the last quarter of 2009, which will be a general
barricade to the mobility of almost all industries, including the baked products fast food
industry. The rapid price increase in the prices of customary ingredients for baked products will
affect both the supply and the demand sides of the market. It will increase the input price,
hurting the manufacturer, and will most likely decrease the buying capacity of the Filipinos.
Nevertheless, the operators are expected to push through only minimal price increases in order
expected to be well patronized, helped by the growing fitness trend among Filipinos. More
innovations are therefore expected in these lines. It is this kind of broad-based demand that
makes snack items such an appealing opportunity for the largest global fast-food chains,
38
particularly as they look to expand beyond the largest urban areas and into less affluent (though
fast food outlets in the country, jumping 15.06% from 2007 to current 2009 figures. Food
service value increased 16% from 2007, and for the whole of the bakery products fast food
industry, doughnut products classify under 92% of the sales of the whole industry. According to
global company researches and international estimates, there is a minimum annual growth of
6.2% in the number of company outlets within the country and 7.68% in forecasted sales for the
next 3 years, yielding to a total of 33.8% and 38.3% in the conjectured growth in percentage of
Capital infusions for the business will be provided solely by the incorporators. This translates
into a relatively low starting capital of 55,000 php. This sets particular financial limitations that
months of operation.
Growth is not a primary focus but is instead a long-term objective.
Designed for analysis in order to implement improvements/adjustments to:
The aim of the design is to be able to improve and make adjustments to the business
operations, from the purchase raw materials to the production up to sale, in order to attain
Healthy donuts will come in two basic options: original and whole wheat.
Flavor variants (for the two options) include:
o Sugar-free chocolate dip
o Fruity-Yogurt filling in mango strawberry and pineapple variants
The unique characteristics that differentiate healthy donuts from existing commercial
doughnuts are:
o Oven-baked instead of deep-fried
o Low calorie
Product Development
Additional flavors of dips and fruity yogurt filling will be researched, tested and launched
Production Process:
Processes
1. Mixing of ingredients Sugar-free chocolate dip
2. Shaping
Processes
1. Mixing
2. Applying
3,
3. Cooling
Baking
4. Cooling
5. Flavoring
6. Serving/Packaging
40
Selling and Quality Control:
Consumers can choose among variants of whole wheat or original doughnuts and flavors
distribution up to the sale of the product. In purchasing raw materials, quality would be achieved
through:
product to be produced
Store excess, unused supply appropriately as to avoid spoilage and unnecessary waste
And finally, during distribution, the finished product should be stored in a sterilized container.
Suppliers
Since the company is a startup operating in a smaller scale, we would be purchasing supplies
at quantities we estimate as ample for our current operation to avoid overstocking. Therefore, it
is unlikely that we will be sourcing our supplies from wholesalers because those types of
41
suppliers would require a larger minimum order amount. To save time cost of transportation, we
would source our supplies from an establishment specializing in selling baking supplies while
offering discounts on bulk orders. The location should also be near our area of operations.
Thus, we have chosen to source most of our supplies from “The Cocoa Pantry” and the other
supplies in Shoppersville and Furatos. Both establishments are located along Katipunan Avenue.
Distribution
Since the company is still a startup business, we will concentrate on a smaller area as our first
market. The company will distribute our products by selling through kiosks inside the Ateneo de
Manila University campus. We will also participate in different bazaar events inside the campus
Aside from selling inside the campus, the members of the company will also use our network
of friends to look for potential customers. A networking website such us Multiply.com may also
be used to connect all our contacts to promote our products to a larger audience.
42
Distribution Scheme
The two diagrams simply show the flow of materials from our suppliers to our customers.
The first diagram represents the flow of materials for the doughnuts while the second diagram is
The first diagram shows that the baking ingredients and packaging for the doughnuts will be
bought from our suppliers first. We will then transfer them to a bakeshop of Patti Malabanan, a
member of the group, to bake the actual doughnuts. We will be paying their bakeshop as we
make use of their equipment and their personnel. We will then transport the finished products to
The second diagram shows that the supplies for the tsokolate drink will be bought from our
suppliers and then be transported directly to our kiosk/bazaar. The reason for this is that the
beverage will be made in the kiosk itself, as tsokolate is usually served hot right after being
brewed.
D. Market Testing
The company conducted an initial survey with the objective of testing out the Big O
product. The main concern of the survey was the acceptability of the taste and the look of our
donuts, especially the Whole Wheat – Fruit Jam filled variant. The survey was conducted on 40
people and were asked to rank the overall appeal of the product (range of 1-10, 1-4 being the
least appeal and therefore unsatisfactory, 4-8 as satisfactory and 9-10 rating as excellent therefore
providing highest appeal) in comparison with other doughnut brands. They were asked to rate the
product “Unsatisfactory” if the product is generally unappealing and is definitely inferior to other
doughnuts available in the market. A grade of “Satisfactory” means that the doughnuts are at par
with most of the existing brands of doughnuts and “Excellent” if the taste and overall appeal is
superb and is greater than the products served by existing doughnut brands. The results show
Rating Given
The data shows that the majority of the people surveyed rated our product at the
Excellent level, at 23 votes, meaning that they think the taste is excellent as well as the
presentation and also more importantly, they think that our doughnuts are better than existing
brands. It is also to be noted that nobody thought that our products were inferior to existing
doughnuts already in the market, as no one voted for a score of 4 and below. This means that,
according to the survey, they thought that at the very least, our doughnuts are a tough competitor
in terms of taste and appeal to existing doughnut shops. Further market testing will be conducted
44
E. Personnel Required
The company has decided, for the purposes of production and operations, to not yet hire
employees at least for the first few months of operations. Because of capital constraints, doing so
will be able to reduce costs and also more importantly to have a first-hand experience on and to
be able to gather data and analyze on the major operations of the start-up business so further
improvements can be made and mistakes be spotted and corrected. For the first few months of
Distribution to kiosk(s)
Delivery to customers
Storage of supplies
Quality Control
Actual selling
Kiosk and cashier duties
45
F.&G. Location and Layout
The area where the business will primarily operate for now is inside the Ateneo campus.
Possible location for the kiosk is the allotted area near the Colayco Pavillion. The baking
Kiosk/Bazaar Layout
1. Counter
2. Display area for the doughnuts
3. Area for making the tsokolate drink
4. Area for the inventory of doughnuts for the day
5. Area for the customers
Can have some seats and tables where some customers may hang out
H. Inventory Management
The company will depend on the projected demand of our products in making decisions on
the amount of stocks that we will keep and the amount of doughnuts we will be manufacturing.
Since we will be employing the services of a bakeshop in making our doughnuts, the personnel
of the bakeshop will be handling the management of the baking supplies while the group will
46
handle the purchasing of the necessary amount of supplies that will be suggested by the
bakeshop.
We will need to have accurate demand projections because our products are perishable and
best served when fresh. The entire inventory levels will also depend on these demand
projections.
I. Maintenance
Supplies will be sealed with air-tight containers and stored in a cool dry place or
Oven, baking pans and other cooking utensils used will be cleaned regularly and after
every use.
The kiosks used for selling will be maintained by sanitizing/cleaningup the area before
opening and also upon closing everyday. Also materials used will likewise be cleaned and
The 11 members of the group will be divided into functional production teams. As the recipes
are fairly simple the group will break into four pairs and a group of three. Three of the
functional groups will be dedicated to doughnut production while the other two will be
assigned to dips (yogurt filling and chocolate dip) and tsokolate respectively. Fifty minutes of
simultaneous production will result in enough batter for approximately 54 donuts. Due to the
stipulations of the kitchen rent contract, production is limited to a maximum of 8 hours daily
with 6 hours of oven time. A one day cycle of production will result in 216 doughnuts With a
fixed biweekly schedule the group can produce up to 432 doughnuts a week. In the hectic
bazaar filled month of December, production will extend to Sundays and reach a maximum
49
Other factors to consider:
Activity Duration
Business registration and similar filings 2 days
Product sampling 3 days
Scouting of possible selling points 2 weeks
Deliberation of a selling area and finalizing contracts 2 day
Procurement of materials from suppliers 1 day
Production and preparation 1 week
Product selling 1 week
Financial status and evaluations 1 day
Yogurt Filling
Ingredients Quantity Price
Low Fat Milk 8 cups PhP 246.00
50
Powdered milk ¼ Cup 8.06
Starter culture ½ cup 10.00
Fruit bits (vanilla extract) 1 ½ tbsp. (1 6.00
tsp.)
Total Ingredients (Makes 85 Servings) PhP 270.06
Total Ingredients per piece PhP 3.16
Tsokolate (strawberry)
Ingredients Quantity Price
Water 1 cup Php 0.25
Tablea 1 tablet 3.40
Isomalt-Sugar mix 3 tbsp. 5.08
Salt 1/8 tsp. 0.01
Milk ¼ cup 7.68
Strawberry Jam 1 tbsp. 2.18
Total Ingredients (Makes 1.5 servings) PhP 18.6
Total Ingredients per serving PhP 2.4
Packaging
Item Quantity Price
Paper Bag 1 piece PhP 1.48
Label / Sticker 1 piece 1.50
Total Packaging PhP 2.98
51
K. Development Budget
To minimize unnecessary employee outsourcing the product will be made by members of the
group in batches two times a week to keep up with production requirements. Ovens used in
the production of the doughnuts, and as incubators for the yogurt filling, will be provided by
members of the group. A sufficient amount will be allocated to costs for the electrical/gas
consumption of these. This cost will be noted as “oven rent.” This negates issues related to
the disposal of said ovens in the event of the company’s dissolution. No rent will be required
52
3rd Product Selling (January)
Working capital P51,940
Purchases(ingredients, production) 53,856
Oven Rental 3,000
Stall space/ Bazaar Rental 13,500
Other Expenses 30,900
Unused capital / Remaining cash-on-hand (49,316)
Expected revenue from sales 132,000
New cash-on-hand P82,684
The number of servings given in the tables indicates the quota of sales. Profits may be increased
through efforts towards alternative selling methods such as personal sales and concessions. The
cost of booth rental or space for the product stand may vary depending on the bazaar in which
the group will participate. Under certain circumstances it is possible for rent to be negotiated on
L. Risk Assessment
Organizational Structure
Golden Halo Inc. will have three major departments under the Executive director:
Operations, Finance and Marketing. These three departments will be further subdivided and each
department and sub committee will have a respective manager to supervise, oversee and monitor
the performance of their specific function. The departments and subcommittees are enumerated
below.
Executive Director
Director of Branding
Director of Sales
a. The Executive Director is in charge of all business functions and the corporate
b. As the Director, he must take the initiative to set short-term corporate goals yearly
in accordance to the company’s mission and vision and its long-term objectives.
c. He must also seek out other ways to improve the organization, through value-
a. The COO is in charge of all business operations, from the supply chain to sales, to
b. She is expected to work together with the Executive Director and the other two
line with branding standards and the company’s mission and vision.
a. The CFO is in charge of all accounting functions, and basically must oversee the
creation of pertinent documents to be submitted to the SEC and BIR (for tax
balance sheet, income statement, and the like. He must ensure that the accounting
principles used in the accounting of business activities fall under IFRS or GAAP.
b. He must approve the accountants hired for his department as endorsed by the
Director of Accounting
c. He must work with all other departments to determine the revenue and costs
55
4. Chief Marketing Officer – Stephanie Tornilla
The CMO is in charge of External Relations and Branding. She works with almost
The Director for PD leads his department in the innovation of the product and its
development. He seeks new ways to improve operation and sales, with heavy
customers. He also works with the CFO to promulgate the expenses incurred in
his department.
distributors, if any. He works with the CFO for production costs, storage costs,
etc.
The Director of Partner Management handles the company’s employees and any
ensures that the supply chain, inter-department communications, and other such
56
details are streamlined and taken care of. He takes care of most of the country’s
administrative work.
The Director of ER handles proposals from organizations for events and the like.
She also seeks opportunities for the company to increase brand exposure. Being in
charge of ER, she also manages the promotions and marketing strategies of the
its mission, vision, and differentiator, and ensures that every single facet of the
channels and its stalls. His job is to maximize sales and make sure that the sales
process fits the company’s branding standards, and ultimately, to report his sales
Plain Flavored
Pricing 20 22
Gross margin 7.8 10.8
Profit margin 0.52 0.6
Sales mix 0.1 0.9
58
Target monthly sales 100000 120000 132000
Monthly sales 10000 90000 12000 108000 13200 118800
Monthly sales units 667 5000 800 6000 880 6600
Daily sales 500 4500 800 7200 660 5940
Daily sales units 33 250 53 400 44 330
Schedule of marketing
expenses
Sample production 900
Tarpaulin printing 2000
Photo shoots 3000
Poster printing 2500
Total 8400
59
Cash Flow from
Financing
Activities
Cash outflow - - -
from dividends
Appendix
o Main ingredients for donuts are only commodities like flour and sweeteners.
o Hence, they are cheap and readily available.
o Threat of forward integration for suppliers is also low since they are mostly
commodity traders.
o Cost of raw materials can be driven down with larger scales of production.
o Consumers generally have a moderate bargaining power because they are constrained
by their cravings and budget yet they remain primary drivers of the donuts business.
o The bargaining power of consumers is driven down by the pioneering position of
healthy fruit donuts as the first healthy donuts available in the market.
o The competition within the industry is fierce, especially the neck-to-neck competition
target markets.
can be very difficult to compete with the established companies on a wider scale.
o Still, there is an opening for products which offer innovation and good value.
choose from.
o Since Filipinos love sweets, sweet products of all kinds appeal to them.
o Donuts are easily substituted with other kinds of pastries.
o Donuts usually serve as the middle ground between the cheaper pastry breads and the
high-end cakes. This position enables it to survive but makes it difficult to thrive.
61
Sample Posters
Consumer Profile
62
Gender
40% men 60% women
Age
18-22 (college) 23-35 (working)
60% 40%
Income per month
P1000-2500 P2500-5000 P5000 and
above
10% 40% 50%
Occupation
Student Working
60% 40%
PEST Analysis
63
SWOT Analysis for Golden Halo, Inc.
64
Competitor SWOT
SURVEY QUESTIONNAIRE
Good day! We’re Management students from the Ateneo de Manila
University conducting a survey for a possible business venture. Please
take your time in answering our survey.
I. Respondent Information
Age: ___
Gender:
[ ] Male [ ] Female
Working Status:
[ ] Student [ ] Professional
Monthly Allowance/Salary:
[ ] less than P5,000
[ ] P5,000 – P9,999
[ ] P10,000 – P19,999
[ ] P20,000 – P29,999
[ ] P30,000 and above
II. Preferences
2. Would you like to try some donuts? (if yes, go to #7; if no, have a nice day)
[ ] Yes [ ] No
66
[ ] once a week
[ ] twice a week
[ ] thrice a week
[ ] more than thrice a week
6. What do you like most about the establishments mentioned? (mark all that apply)
[ ] Ambiance [ ] Brand
[ ] Variety [ ] Price
[ ] Healthiness
7. Would you be interested in low-calorie donuts? (if no, have a nice day)
[ ] Yes [ ] No
9. Would you buy doughnuts from a brand called, “The Big O!”?
[ ] Yes
[ ] No, then please choose from which you prefer from these alternatives:
[ ] Whoa! Donuts
[ ] Halo Donuts
[ ] Wicked Donuts
10. Which of these logos appeals to you the most? (encircle your preference)
13. How much would you be willing to spend for a box of 3 low-calorie donuts?
[ ] P30 – P59 [ ] P90 – P119
[ ] P60 – P89 [ ] P120 and above
14. How much would you be willing to spend for a box of 6 low-calorie doughnuts?
[ ] P30 – P59 [ ] P90 – P119
[ ] P60 – P89 [ ] P120 and above
15. Would you want a hot chocolate beverage to go with your box of doughnuts? If yes,
continue. If not, then alrighty.
16. How much would you be willing to spend for a combo that has a chocolate drink
and 3 doughnuts?
[ ] P50-69 [ ] P100-119
[ ] P70-99 [ ] P120-139
17. How much would you be willing to spend for a combo with a chocolate drink and
6 doughnuts.
[ ] P80-119 [ ] P140-159
[ ] P120-139 [ ] P160-179
68