AMIGO SEGURADO Spaghetti Marketing Plan

I.

Executive Summary
La Filipina Uy Gongco Corporation launched its Amigo Segurado Spaghetti and

Macaroni in the last quarter of 2012. Amigo Segurado premium pasta is health friendly pasta made from the choicest durum wheat, guaranteeing the consistent pasta firmness and nutritious goodness that only an all-natural product can give. It is the pasta for todays discerning consumer who wants high quality and healthy food products. This report forms the marketing plan for Amigo Segurado Spaghetti in the Philippine consumer market. The plan contains the groups views on the overall product concept and proposition, the products target market, positioning, marketing strategies for product, price, place and promotion and short and long-term projections for Amigo Segurado Spaghetti. La Filipina Uy Gongco Corporation is investing P1 Billion in modern plant and equipment facilities for mass production of their new pasta product line and it is planning for expanding its distribution network. This marketing plan propeses to expand its operations in Panay area which includes the provinces of Iloilo, Antique, Aklan and Capiz. The place strategy will focus on retail stores around Panay because retail stores are the primary sources of Filipino households in-home consumer packaged goods. Intensive dealerdistributor network is desired focusing on retailers as key channels for end consumers. As for the promotion strategy, the company will invest in print, broadcast, and outdoor advertising. The promotions will be started in the third quarter of 2013 until the second quarter of 2014. In implementing this proposal the company expects to generate the following net income for the year; P15,097.18 for 2014 and 2015; P662,556.23 for 2016; P759,007.21 for 2017 and P1,463,499.71 for 2018.

II.

The Challenge

About Amigo Segurado For the longest time, the market in the Philippines was created to by brands that bespoke

AMIGO SEGURADO Spaghetti Marketing Plan of good quality but leaves more for wanting. Amigo Segurado, on the other hand, was coming in as a player promising to give more for typical pasta consumption and become the ultimate pasta perfection locally. Amigo believes in the power of the cooking woman and mother. Cooking is more than just transforming raw ingredients into a dish. It is the creation of flavor into food, which sparks delight into everyday meals. With the power of cooking in their hands, women create relationships and strengthen bonds. Brand Values The challenge is to make our products the healthy choice for consumers without compromising taste, convenience and affordability. Amigo Segurado believes that good food matters. It adds untold pleasure to our lives. And everyday meals can be just as magical as special occasions by adapting it to Filipino cuisines. Amigo Segurado further believes that it can be: A food solution that elevates you out of everyday life and provides you the exciting ability to create an incredibly tasty meal without any hassles and thus ensure your familys good health while remaining within your budget.

III.

Situation Analysis

Company Analysis In 1901, Mr. Uy Yan Gong (Julian Uy Gongco) opened a bakery and grocery store. The business thrived thru his hardwork, diligence, and integrity. La Filipina Uy Gongco grew to become a reputable importer and distributor of general merchandises from the U.S.A., China, Thailand, Hawaii and Europe. It was one of the biggest trading houses in Panay and Negros Islands.

AMIGO SEGURADO Spaghetti Marketing Plan The Second World War destroyed almost all material wealth he accumulated. Only his good reputation remained intact. He was incarcerated by the Japanese imperial army and died shortly after his release from detention. His eldest son, Mr. Uy Chiong (Jose Uy Gongco) reopened the store after the liberation in 1946 under the name La Filipina Uy Gongco de Uy Chiong. Strong supports were provided by the old suppliers of La Filipina Uy Gongco. In 1949, La Filipina Uy Gongco de Uy Chiong became a partnership adopting the name La Filipina Uy Gongco. Mr. Tan Chin Eng, a cousin and a new partner, took the helm of the business. The company became a corporation in 1971 under the name La Filipina Uy Gongco Corporation. Mr. Alfonso A. Uy (Alfonso Uy Gongco), who joined the company in 1954 at the age of 15, took over the leadership of the company in the late 1960s up to the present. From a small bake shop and grocery store, La Filipina has grown into a company involved in trading of feeds ingredients, fertilizers, sugar, vegetable oils, grains, wheat flour, and owner-operators of sugar mill, flour mills, animal feeds mills, livestock farms, cargo ships, hotels, housing projects, shopping mall, and bank. The companys success is attributed to its policy of high integrity, reliability as a provider of quality products and services to customers, equal opportunity employer, responsible corporate citizenship, and trust worthy relationship with stockholders. The company takes pride in its people. The strong team composed of a group of able executives and staff who assist the president in the planning and operation of the group of companies. The goals of La Filipina Uy Gongco Corporation are the following: To expand production facility while maintaining the quality of its products To establish strong sales in the countrys major supermarket chains La Filipina Uy Gongco Corporation focuses on the following:

Value. We offer greater value to the consumer with nutritous products that have exquisite

AMIGO SEGURADO Spaghetti Marketing Plan flavor.

Integrity. Our commitment to the highest standard is the foundation of our customers trust.

About Pasta A serving of cooked spaghetti (1/2 cup) contains mere 99 calories, less than half a gram of fat, and less than 5 milligrams of sodium. Pasta is high in complex carbohydrates, which helps give us energy. Pasta comes in many different shapes and sizes. There are simple string-shaped pasta like spaghetti and vermicelli, ribbon-shaped ones like fettuccine and linguine, short tubes like elbow macaroni and penne, decorative fancy shapes like farfalle and rotelle, large sheets like lasagna, and hollow pasta stuffed with filling, like ravioli, manicotti, and tortellini. It has been part of the Filipino culture to associate pasta with occasions like birthdays, fiestas, Christmas, etc. Todays consumers have redefined this tradition. Everyday could be a very special day without any occasion, thus everyone can eat pasta anytime they want. No matter what your background or cooking skills may be, everyone should be able to create an incredible meal without having to spend hour in the kitchen. Its association with quality, taste, convenience and innovation and the increasing health consciousness in consumers are the major strengths of the company while its major weaknesses are its limited distribution, customers lack of brand awareness and the highly competitive established brand competitors. Customer Analysis The Philippines population has been growing by approximately 2 percent annually, currently reaching nearly 100 million. This has had a compounding effect on the demand for food and beverage products. Consumers in the Philippines have become increasingly price-sensitive due to the

AMIGO SEGURADO Spaghetti Marketing Plan economic recession. Consumers are expected to continue searching for economy brands, allowing for private label brands to increase their market presence. The Amigo Segurado Spaghettis primary target market is the mothers comprising the housewives, working or professionals who cook regularly or cater food preparations for family occasions. Potential market also includes the urban professional segment, which has little time to prepare dinner and will be attracted to quality and freshness of The Amigo Segurado products. The pasta products are ready to eat in half the time of dry pasta (one to three minutes) and are fresher than the competition. This gives the Amigo Segurado products a decidedly better taste and consistency. Spaghetti is a popular and favorite dish in Philippines. In most of the occasions like parties and gatherings, spaghetti will be the one of the main stays; even McDonalds and other popular fast food chains have spaghetti on their menu. Since, Filipinos are also very fond of pasta and pizza- the reason why these are always available whether in fast foods or in casual dining restaurants. Whats not to love about Filipino Sweet Style Spaghetti, a must for a Pino y childrens birthday party along with fried chicken and hotdogs on bamboo skewers with a marshmallow on each end. Mothers housewives, working or professionals who cook or cater parties for family occasions are the primary target market for dried pasta in most of the studies conducted, dominantly Class C and D but also includes Class B aging 20 to 55 years old. Purchasing dried pasta is highly seasonal. Higher sales revenue can be achieved during the 1 quarter of the year for fiesta and graduation celebration purposes. December holidays like Christmas and New Year is also a good time to generate income. Celebrations like birthdays, baptism, anniversaries and other special occasions may include spaghetti on their menu. The followings are the needs, wants and demands of spaghetti to the mothers: Mothers need to satisfy hunger, express love, be recognized and prepare the best food for
st

their family and loved ones.

AMIGO SEGURADO Spaghetti Marketing Plan Mothers want to buy affordable products to maximize the value for money and at the

same time are concerned about product quality. Competitor Analysis Direct competitors are other pasta brands like Knorrs Royal Spaghetti, Ideal Gourmet, Del Montes Spaghetti Italiana, Rams Premium Spaghetti and Fiesta Spaghetti. Indirect competitors include pancit, palabok, take out & delivery noodle dishes, restaurants and fast food chains like Jollibee, serving spaghetti and other noodle dishes. Pasta in the Philippines is usually flavored with just spaghetti sauce and meatballs but unlike other brands of pasta, Amigo Segurado can go perfectly well with the Filipinos everyday viand like sardines, adobo, afritada, menudo and other Filipino ulam. When it comes to affordability, White King Fiesta and Ram premium compete with Amigo Segurado. For a 1kg package, the prices of Knorrs Royal Spaghetti, Ideal Gourmet, Del Montes Spaghetti Italiana, Rams Premium Spaghetti and Fiesta Spaghetti are P105.55, P89.00, P111.75, P65.10 and P69.00 respectively. Amigo Segurados price for a 1 kg package is only P56.80 which is way cheaper compared to other brands. Amigo Segurado is just available recently unlike other brands like Knorrs Royal pasta that has been established decades ago. Since it is newly launched, it is still not distributed nationwide. It is only available in some selected supermarkets in Metro Manila and Cebu. Ram Premium is the only one available in all retail outlets. In spaghetti pasta, Fiesta is the year 2012s market leader with 29.4% followed by Knorr Royal with 21.4% and Ideal Gourmet with 19.6%. Amigo Segurado is trying to steal leadership of the category from these well-known pasta brands through a combination of aggressive advertising, very competitive pricing strategy and product differentiation. Endorsements by local celebrities like actors Richard Yap and Daniel Padilla helped to strengthen consumer awareness of Amigo Segurado.

AMIGO SEGURADO Spaghetti Marketing Plan

Market Share

19.60% 21.40% Fiesta Spaghetti Knorr Royal 29.90% Ideal Gourmet 29.40% Other brands (Del Monte, Ram Premium, Sunshine, etc.)

Figure 1. Market Share of Spaghetti Pasta in the Philippines, 2010 Collaborators Amigo Segurado is being distributed first in different supermarkets in big cities like Metro Cebu and Metro Manila. Its main distributors are Gaisano Mall and Ayala Mall. Philippine Foremost Milling Corporation, sister company of Uy Gongco La Filipina Corp., provides flour for the production of Amigo Segurado. It has been the first milling industry in the country to be awarded with the Food Safety Management System (ISO22000:2005) Certification which is the latest and highest internationally recognized standard specifically designed for food manufacturing industry. PFMC uses the best wheat, selected from the best wheat fields in the world and it offers only the best and the purest flour that comes from Climate (PEST Analysis) Political and Legal Environment La Filipina Uy Gongco Corp. is a sister corporation of Philippine Foremost Milling Corporation, as one of the leading flour and feeds manufacturer in the country and now on the

AMIGO SEGURADO Spaghetti Marketing Plan pasta manufacturing, is governed and is abiding all laws applicable to all its operations, may it in production, administration and others, enforced by the state and through international agreements. Producing its nutritional and high quality Amigo Segurado Spaghetti and Macaroni entails various processing standards which the corporation is adopting. In fact, it has been the first milling industry in the country to be awarded with the Food Safety Management System (ISO22000:2005) Certification which is the latest and highest internationally recognized standard specifically designed for food manufacturing industry. As well, one of the rigid regulations that the entity is complying with is the Food, Safety, and Standards Act which requires all firms to mark and label any packaged foods they are manufacturing, distributing and selling. Labels cannot contain statements that are false or misleading in any way concerning the food that is in the package. This might apply to misleading the customer about the quantity of food that is in the package, the nutritional value of the food that is in the package, or the therapeutic claims to the place of origin for the food products. The manufacturers of the product also must ensure that the label itself does not mislead consumers in its shape or appearance. It further prohibits that no food can contain any containment of naturally occurring toxic substances, toxins, hormones, or heavy metals that are in excess of the acts stipulations. Concerning about quality control, the establishment allows federal inspectors to schedule regular visits to ensure that the company is adhering to government laws. Moreover, the Amigo Segurado Spaghetti is enriched with thiamine, niacin, riboflavin, iron and Vitamin A that are required by the Food and Drug Administration to be present in pasta products and is governed by the Ministry of Commerce in food trade, foreign investments, food distribution and domestic and international market activities. On the other hand, La Filipina Uy Gongco Corp. commits with the environment by abiding numerous laws through its recycling culture, biodegradable Master packaging and the boiler technology that position the corporation at the same level of the environmental impact standards of most industrialized countries in the world. Locally, it complies with the Clean Act

AMIGO SEGURADO Spaghetti Marketing Plan Act and Clean Water Act that regulates the proper disposal hazardous substances such as chemicals, industrial smokes and other trashes. It has been issued also with a Sanitary Business Permit which certifies that it has passed with the standards set by the Iloilo City Government in proper housekeeping of the business place. Economic Environment Due to certain economic conditions, price becomes the most influential factor in pasta purchasing decisions for Filipinos. As consumers traded down to cheaper products and price competition between manufacturers intensified, growth in pasta current value sales in 2011 is slightly slower than that recorded in 2010 and also below the average for the entire review period. Growth in retail volume sales meanwhile is up on the previous year and slightly faster than the 5-year CAGR. This is partly due to greater price competition which attracted more middle and low income consumers into the category. At the same time, the growing availability of affordable pasta sauces also encouraged Filipinos to increase their consumption of pasta. On the competitive landscape, La Filipina Uy Gongco Corp. could able to have leadership in their pasta brand by a combination of aggressive advertising and a very competitive pricing strategy. The latter proves particularly influential towards the end of the review period as economic gloom led Filipinos to trade down to cheaper pasta brands. At the same time, endorsement by local celebrities like Richard Yap has helped to strengthen consumer awareness of the Amigo Segurado Spaghetti. Social and Cultural Environment The socio-cultural environment is one of the marketing environments where a business needs a great focus and gather enough and appropriate information for it to excel in the target market. La Filipina Uy Gongco Corporation Corp. extends its business to the target market by responding and be sensitive to the demands and needs of the society. Pastas are portions of a wide and diverse Filipino culture especially during occasions. Pasta is part of every Filipino familys birthdays and Christmas. These are the reason why La Filipina Uy Gongco Corp. is dedicated on their production on pastas and baking products. The

AMIGO SEGURADO Spaghetti Marketing Plan firm believes that the best taste comes only from the purest flour and it is by offering the market with only the purest of raw materials selected from the best wheat fields in the world. The company values its baking products as Filipinos value bread and pasta. At present, it is proper for parents to know what their children consume and that is the reason why the business responded by producing flour products enriched with Thiamine, Niacin, Riboflavin, Iron, fortified with Vitamin A and Bromate free. More importantly, with the growing demand on instant yet healthy food options, Amigo Segurado Spaghetti and Macaroni is the pasta for todays discerning consumer who wants high quality and healthy food products. Amigo Segurado is health friendly because it is 98% fat free, is low in sodium, and is cholesterol-free. It is also a good carb, providing complex carbohydrates needed for the bodys energy needs. Amigo Segurado is therefore a healthy energy source for todays active consumer. Technological Environment La Filipina Uy Gongco Corp. incorporates the best technology in its Amigo Segurado Spaghetti and Macaroni production. This dedication to quality has resulted to only the most nutritionally balanced and most cost-effective products money can buy. The entity is using production lines that are shipped from foreign nations, installed by company engineers and are capable of producing around 8,000 pounds of pasta every hour. It has also formulated a custom bulk handling system to feed the production lines with semolina. Storage silos are constructed to store the milled semolina and feed a 700 feet long, six-inch diameter pneumatic tube which can deliver nearly 62,000 pounds of semolina ever hour to production lines. As well, robotic technologies are supplied to the business to carry out packaging, warehousing and storage functions and palletisers are installed. These have the advantage of being faster than the standard robot gantries for warehousing and they also occupy less floor space. The palletisers feed the pallets to a Lantech stretch wrapper. The wrapped pallets are then conveyed to the warehousing area. The new technology allows 83 pallets an hour to be

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AMIGO SEGURADO Spaghetti Marketing Plan processed. Moreover, the company facilities are designed to achieve super grading for plant sanitation. Part of the sanitary design for the facilities includes rounded roof joists and pharmaceutical-grade Teflon-coated ceiling tiles to prevent dust accumulation. Pharmaceuticalgrade tiling is also used in all production areas. Furthermore, the pasteurization process is employed in moving the rolls of dough through a steamer, which heats the dough to 220F (104C) in order to kill any existing bacteria. SWOT Analysis By analyzing the internal attributes of the product, we have identified the following strengths which are its edge from other competing brands on its line as well as the products weak points. On its environment, we have identified the following opportunities that could help the product succeed the competing market as well as threats that if not properly addressed can be a hindrance in its success. STRENGTHS Product Related: Amigo Segurado as a new brand option for spaghetti buyers and consumers in the Philippines Wider variety of taste offered to the consumers with new innovations for pasta recipes Health- friendly pasta brand (98% fat free, is low in sodium, and is cholesterol-free) Limited Distribution/ Availabilty of Amigo Segurado (still not available for Panay market) Low Brand Salience Levels (Consumers are not really aware of the brands benefits due to newness to the market) WEAKNESSES

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AMIGO SEGURADO Spaghetti Marketing Plan Filipino-made product (Amigo Segurado is made for Filipinos) Launch at a price almost 50% less than prevailing brands in the market Company Related: Investment of La Filipina Uy Gongco Corporation of P 1 billion on modern plant and equipment facilities for mass production of their new pasta product line Improving and offering new product lines Plan for expanding distribution network; Corporation has its own shipment facility for flour distribution that can be incorporated with pasta distribution Companys policy of high integrity and reliability as a provider of quality products and services to customers Need improvements for additional product size variants (Available only on 1kg and 500g size variants)

OPPORTUNITIES Improved economy growth for the period is mostly associated with consumption and . (Net) disposable income has increased over the past few years, thus increasing the

THREATS Established brands in the market may produce brand loyalty on the consumers

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AMIGO SEGURADO Spaghetti Marketing Plan consumers purchasing power (greater amount of Filipino household purchases is attributed to food). Sales in dried processed food sector rise in value from US $742.1 million to US $790.6 million, retail volume from 399.8 million tonnes to 410.8 million tonnes A drive of high awareness for healthy, hygienic and conveniently packaged food is on the rise Health consciousness on the rise in consumers. Openness of consumers for new, innovative food preparations Consumer perception and willingness for local high-quality food brands. Consumers call for easily-prepared food solutions Goverment support for Filipinomade products Rise of fast food chains and restaurants that offer pasta dishes in their menu Consumer exposure to foreign products has also increased and a high-quality notion of Filipino consumers for foreign products Influx of foreign brands in the same category can give rise to sterner competition

IV.

Market Segmentation
Segmenting the market and identifying the target market for Amigo Segurado would help

the group in drafting the appropriate marketing mix strategies needed for Amigo Segurados interaction in its competitive market.

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AMIGO SEGURADO Spaghetti Marketing Plan Amigo Segurado for the past few months since its launch have test market Metro Manila and Cebu. Our paper focuses and limits its target market geographically to the Panay Island including the provinces of Iloilo, Antique, Aklan and Capiz. Since certain factors and variables bear high correlation with the taste preference and eating habits of consumers, these factors will be use on further segmenting the Panay market. Preparing pasta and spaghetti has been a part of every Filipino familys tradition especially as part of celebrating special occations. Identifying and Describing the Target Market After the groups analysis on the market, target markets were identified that best represents the ideal consumers for the product.

Figure 2. Household population, Number of households and Average household size for Western Visayas The primary target market is composed of the mothers comprising the housewives, working or professionals who cook regularly or cater food preparations for family occasions.

BUYER Mothers Age 25 - above

CONSUMER Children 5 16

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AMIGO SEGURADO Spaghetti Marketing Plan Gender Family/Household Size Lifecycle Stage Average Household Income Education Occupation Female 4+ Married with children P135, 000 (Dominantly Class C & D but also includes Class B) --Housewife/Working Woman Primary/Secondary School Students Male/Female --Kids/Early Teens N/A

Table 1. Summary of description for the primary target market Based on the monthly update for February 2013 of the National Statistics Office for Region VI, the average household size is 4.6 and a there was a total of 1,526,587 households in the whole Region. Other potential target market Base on the groups analysis of the market, other than the primary target market there can be potential target markets than could deliver huge amounts of sale for Amigo Segurado especially regarding the seasons that could greatly affect the targets markets buying behavior. Increase on sales may be expected on the following seasons: 1st Quarter of the Year Fiesta Season in Panay, Graduation December Holidays Christmas & New Year (Retail stores in Panay may also be a potential B2B target market) Estimating the Target Market Demand Potential The target market demand potential would be equal to the number of buyers multiplied by the uantity of average purchase multiplied by the average price of the product.

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AMIGO SEGURADO Spaghetti Marketing Plan

Calculating for variables: N is equal to (number of mothers included in a household classified as Class C, D including B). Class C, D including B households are those slightly above the poverty line. Assumed that 1,526,587 households in the whole Region would mean 1,526,587 mothers in the whole region. Poverty headcount ratio at national poverty line (% of population) for the Philippines as identified by the World Bank Organization is 26.5% which would mean 73.5% (100% - 26.5%) is above the poverty line and is included in the target market.

Q is assumed to be 1 for the average purchase for a household comprising of 4 family members is 1 pack of a 1 kilogram variant. P is equal for P 56.00 for it is the average price of 1 pack of the 1kg variant. So,

Positioning Statement Amigo Segurado will be positioned in the target market as follows: Ang Amigo Segurado ay Masarap Bagayan. Amigo Segurado is a food solution for mothers that elevates them out of everyday

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AMIGO SEGURADO Spaghetti Marketing Plan life and provides them the exciting ability to create an incredibly tasty meal without any hassles and thus ensure your familys good health while remaining within your budget.

V.

Selected Marketing Strategy

Product Strategy About Amigo Segurado Pasta Amigo Segurado is a health friendly pasta made from the choicest durum wheat, guaranteeing the consistent pasta firmness and nutritious goodness that only an all-natural product can give. It is ideal for todays discriminating consumer who wants high quality and healthy food products. Amigo Segurado is health-friendly because it is 98% fat free, low in sodium, and is cholesterol free. It is a healthy energy source for todays active consumers. Packaging As reflected on its packaging, 100g serving of cooked AmigoSegurado pasta contains 360 calories, 1g of fat, 135mg of potassium, 75g of carbohydrates and 13g of protein. Cooking instructions showing 4 easy steps to prepare it in just 10 minutes can also be seen on its packaging. The Buy Pinoy, Save Jobs logo is also printed on its packaging as Amigo Segurado participates in Buy Pinoy Exporters Fair that was started as a project by the Philippine Exporters Confederation, Inc. (PHILEXPORT). Its purpose are to raise the level of consumer consciousness on the global competitiveness of Filipino made products in terms of design, quality and price, to awaken the latent patriotism and national pride among Filipino consumers and product developers and suppliers and to create, protect and secure jobs of locals through promotion of the products of their efforts .

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AMIGO SEGURADO Spaghetti Marketing Plan Amigo Segurado (plastic pack) is approved by the Philippine Food and Drug Administration which primary goal is to ensure the safety, efficacy, purity and quality of products being made available to the public. Through effective implementation of the national regulatory framework consistent with international best practices, it will ensure the health of Filipinos as their vanguard. Amigo Segurado pasta is available in different packages, 1kg, 500g and 250g. To further enhance the packaging and for the benefit of the consumers, different recipes as part of Amigo Segurados Masarap Bagayan concept should be on its packaging. The Masarap bagayan Concept The Philippine palate is adventurous in terms of trying out new flavors. To address the Filipinos adventurous side, Amigo Segurado introduces the concept of Masarap bagayan. Amigo Segurado also wants to redefine traditional mentality of Filipinos about pasta. We intend to communicate what Amigo Segurado should mean to our profiled ideal buyers (e.g. housewives/ mothers) and consumers. It is much more than merely typical pasta. It is a passport to the rich Filipino cuisine, adding new ideas and new twists to old favorites. Amigo Segurado lives to its commitment that spaghetti and macaroni can go perfectly well with the Filipinos everyday ulam. Amigo Segurados value statement: Masarap Bagayan - great food is exhilarating. It elevates us out of the everyday. No matter what your background or cooking skills, we believe that everyone should be able to create an incredible meal without having to spend hours in the kitchen. The company understands the need of every Filipino family for a high quality and affordable food so consumers are assured that every product of Amigo Segurado is clean, accurate in weight and right quality. The company believes that Basta Amigo, Segurado!

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AMIGO SEGURADO Spaghetti Marketing Plan Pricing Strategy Customers usually have a reference price in their mind for a particular product and therefore they might compare the price of Amigo Segurado pasta with the price of other brands like Fiesta Spaghetti and Knorr Royal. We aim to have a 15% profit per unit so the total relative costs for producing the Amigo Segurado Pasta plus other relative costs (e.g. administrative and selling costs) must not be more than the suggested retail price divided by 115%. So for a 1kg package of Amigo Segurado which suggested retail price of the company is P56.80, the total cost that should be maximized must not exceed P49.39 (P56.80 /115%). Pricing strategy for the launch of Amigo Segurado is based on the objective of satisfying consumers budget. Amigo Segurado is priced cheaper compared with the other brands. Thus, the effect of lower price can be offset by the increase in sales volume. Furthermore, the introductory price of Amigo Segurado will be regularly revised according to the changing forces in the market environment and its performance. Place Strategy Amigo Segurado is a product new to the Filipino market competing with existing pasta (spaghetti and macaroni) brands on the market that have established its distribution channels allowing its availability to end consumers. Amigo Segurados launch last November 2012 had drive attention to the buying market for its use of popular stars such as Richard Yap and Daniel Padilla but the problem still resides on its availability especially to the Panay market. The group thus proposes an extensive and systematic distribution process and strategy for Amigo Segurado for its availability on the Panay market. A Focus on Retail Stores Around Panay The Consumer Index for Asia for 2012 identified provision stores and retail stores as

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AMIGO SEGURADO Spaghetti Marketing Plan primary sources of Filipino households in-home FMCG (Fast-moving consumer goods) or consumer packaged goods where noodles and pasta products pushed packaged groceries sales build up. Supermarkets also grew faster by 8.7% through more trips as well as identifying Puregold and Robinsons as key retailers the exhibited the fastest growth rates as they expanded their reach throughout the market. Distribution An intensive dealer-distributor network is desired focusing on retailers as key channels for end consumers. Since the target market for Amigo Segurado are mothers included in the Panay area, the focus would be the identified primary retail stores on key provinces of Panay such as Iloilo, Aklan, Antique and Capiz included separately the Iloilo City. The distribution process is carried as follows (downstream): 1. La Filipina Uy Gongco Corporation (with a Panay Main Office in Iloilo City) distributes or with exclusive distributors in Panay for Amigo Segurado sells it to various wholesalers in target market areas identified. Since these are high volume sales, per unit margins are relatively low allowing motivation for distributors. 2. The wholesalers then sell to retailers at a reasonable margin but is relatively higher compared to the margin for distributors and wholesalers in lower volumes as well. 3. Retailers would then be the key channel for the product be available to end consumers. Retailers would be identified as listed below. Along with the above distribution process a Sales Force for Amigo Segurado is structured to facilitate the entire process. The structure is as follows: POSITION Territory Sales Officers (as determined by the number of territories per target area) Revenue Target Driven Responsible for a location/territory ROLE

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AMIGO SEGURADO Spaghetti Marketing Plan within the targeted area (Iloilo Province, Iloilo City, Aklan, Antique and Capiz) Liaison with retailers Ensuring product placement, availability and merchandizing at POP/POS (point of purchase/point of sale) Liaison between the retailer and wholesaler/distributor

Area Sales Managers (probably 5, one for each area identified as Iloilo Province, Iloilo City, Aklan, Antique and Capiz ) Responsible for a cluster of territories Managing various territories Personnel Management Conflict Management & Problem Resolution

Panay-Wide Sales Manager Responsible for a collection of areas with its key office on Iloilo City. Responsible for reporting and communicating the status of management and sales to the National office.

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AMIGO SEGURADO Spaghetti Marketing Plan

Figure 3. Location of the La Filipina Uy Gongco Corporation, Panay Main Office, 21 P. Arroyo Street, Iloilo City

Identifying Key Locations for Distribution The focus of the target market is located on key areas of Panay including Iloilo Provine, Aklan, Antique and Capiz including separately the Iloilo City Area where the Panay Main Office is located. Key territories for each province areas would include the main municipalities in the province area and some municipalities based on population distribution and economic growth.

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AMIGO SEGURADO Spaghetti Marketing Plan

Figure 4. Map of Panay showing the interconnections between key province areas Key territories would include:

AREA Iloilo City Iloilo Province

TERRITORY Iloilo City Territory Miag-ao (1st Congressional District) Santa Barbara (2nd Congressional District) Janiuay (3rd Congressional District) Passi City (4th Congressional District) Barotac Viejo (5th Congressional District)

Aklan

Kalibo Malay (9.94% of the total population of Aklan excluding Kalibo) New Washington (9.13% of the total

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AMIGO SEGURADO Spaghetti Marketing Plan population of Aklan excluding Kalibo) Antique San Jose de Buenavista Sibalom (11.48% of the total population of Antique excluding San Jose) Culasi (8% of the total population of Antique excluding San Jose) Capiz Roxas City Tapaz (8.53% of the total population of Capiz excluding Roxas City) Pontivedra (7.72% of the total population of Capiz excluding Roxas City)

Recommendations for Logistics It is recommended that La Filipina Uy Gongco Corporation would maximize the use of its transportation facilities for assisting distribution and delivery of Amigo Segurado from the production factory and warehouses in Greater Manila Area to key areas in Panay. The shipment facility of the corporation for their flour products would be a great edge on the distribution to Panay if it could be incorporated with Amigo Segurado. La Filipina Uy Gongco Corporations investment of P1 billion on a modern plant and equipment for Amigo Segurado product line across the milling facilities of Philippine Foremost Milling Corporation is an initiative of the corporation for the improvement and mass production of their new product line.

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AMIGO SEGURADO Spaghetti Marketing Plan Promotion Strategy Communication Campaign The objectives of the communication campaign will be as follows: Create a strong brand association by means of an emotional theme in communication highlighting the important role the brand plays in terms of care and health of the family. Own a unique position in consumers mind through elaborating the functionality of the product and try establishing the position as in the positioning statement. Use best practices and techniques for developing greater brand awareness, interest, and trial generation. Maintain consistency in visual presentation to establish strong brand recognition.

Advertising Strategy Print Advertising In introducing Amigo Segurado Spaghetti in Panay, the company will employ print advertising to inform and persuade potential consumers. It will invest in printed ads in newspapers, flyers, posters and the like. Broadcast Advertising The existing TV commercials featuring Richard Yap, also known as Papa Chen and Daniel Padilla that thematically portray the positioning statement of the company in a creative and engaging manner will be used in broadcast advertising that will be employed in Panay. Subsequently, shorter adaptations of the TV commercial will also be developed. The TV commercial will also be adapted into a radio commercial. The Amigo Segurado tagline will be retained as is. Outdoor Advertising The company recognizes the effectivity and relevance of outdoor advertising. It also has

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AMIGO SEGURADO Spaghetti Marketing Plan the potential to reach massive group of customers through a single advertisement. The company will team up with a bus company to employ bus advertising to firmly establish awareness and generate quick recall to the potential customers. Traditional outdoor advertising like posters and billboards which are highly visible to vehicular traffic would help achieve advertising objectives and increase brand awareness by placing multiple units in strategic locations. Activation Strategy Outdoor Activation School Activation Major educational institutions throughout Panay will be activated. The activation intends to infuse product awareness among the students and the faculty and staff of the colleges and universities as generating trials. Product awareness will be achieved thru branded kiosks and stalls placed inside the school cafeteria or canteen. Kiosk attendants will be responsible to educate potential customers as well as generating interest and desire while inducing trial. A comprehensive list of educational institutions where the activation will be conducted is as follows: PROVINCE Aklan COLLEGE/ UNIVERSITY Aklan State University, Kalibo Panay Technological College, Kalibo Antique University of Antique, Sibalom St. Anthony's Colleg, San Jose Capiz Colegio dela Purisima Concepcion, Roxas City Capiz State University, Roxas City Iloilo Central Philippine University, Iloilo City John B. Lacson Foundation Maritime University, Molo, Iloilo City

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AMIGO SEGURADO Spaghetti Marketing Plan University of San Augustin, Iloilo City University of the Philippines-Visayas, Molo, Iloilo City West Visayas State Universities, La Paz, Iloilo City Mall Activation The activation of educational institutions will be replicated at various shopping malls across the city. Along with awareness and trial objectives, interest in the products offering will be enhanced through various games, prizes and freebies. In Gaisano Malls throughout Panay. Point of Purchase Activation Point of Purchases of retail stores and supermarkets will also be activated using. A particular segment of the chosen public market or supermarket will be dedicated as Amigo ng Bayan which would have the following: A branded kiosk to give it a creatively distinctive look from its surroundings A promotion agent who is an educated and pleasing male or female promoter that will persuade potential consumers to that particular area. The promotion agent will provide information about the product, induce tasting and persuade trial purchase through special price offering. Direction Stickers at public markets or supermarkets directing to Amigo ng Bayan area for attractive offerings. Attractive Point of Purchase (POP) to be placed at strategic locations in the chosen public market or supermarket Canteen and Cafeteria Branding Cafeterias or canteens of selected universities, colleges and pre-schools in Panay will be activated via branding using the communication campaigns visual adaptations. Furthermore, since Amigo Segurado Spaghetti will be served at these venues at

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AMIGO SEGURADO Spaghetti Marketing Plan subsidized prices, it is likely to generate greater trial and repeat purchase. Branded Mobile Vans During the test market stage, branded Vans will be deployed in targeted areas near offices, parks and other public places during peak hours to serve Amigo Segurado Spaghetti at introductory prices. Sales Promotions Consumer Promotion Post launch, a press and radio driven consumer promotion will be designed to invite consumers to share their own innovations and customizations to Amigo Segurado Spaghetti Recipes. Consumers will be asked to share their recipe for a variation of Amigo Segurado Spaghetti. The recipe will be sent along with 2 empty packages of Amigo Segurado Spaghetti and customers contact information. The lucky winners would be given cash prizes along with recognition in the form of the recipe being printed on the packaging along with the customers photo (if they so desire). Public Relations To help the Department of Health (DOH) and Department of Education (DepEd) in informing and educating the people about the importance of having good food as part of healthy living, La Filipina Uy Gongco Corporation will sponsor a food assistance program in selected areas in Panay. The company will identify schools where to conduct the program. The food assistance program will be implemented for one month in the selected schools within Panay. There will be five beneficiaries for the program that would be selected with the aid of the Department of Education in Region VI.

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AMIGO SEGURADO Spaghetti Marketing Plan The launch year marketing budget is as follows:

AMIGO SEGURADO Spaghetti Launch Budget - Marketing Communications

Budget Ceiling Advertising Print Advertising Newspapers (see Note 1 ) Flyers Subtotal Broadcast Advertising Television (see Note 2) Radio (see Note 3) Subtotal Outdoor Advertising Billboard (see Note 4) Bus Advertising Subtotal Out-of-Home Activation University/College Activation Direct Materials (see Note 5) Direct Labor (see Note 6) Installation Subtotal Mall Activation Direct Materials (see Note 7) Direct labor (see Note 8) Cost of putting up a stall Subtotal Point of Purchase Activation Php Php Php 80,000 8,000 20,000 Php 108,000 Php Php Php 220,000 22,000 33,000 Php 275,000 Php Php 1,440,000 50,000 Php 1,490,000 Php 10,380,000 Php 60,000 Php 10,440,000 Php Php 49,392 10,000 Php 59,392 Php 15,000,000

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AMIGO SEGURADO Spaghetti Marketing Plan Branded Kiosk Agent's Salary (see Note 9) Direction Stickers Subtotal Sales Promotion Consumer Promotion Promotion Expenses (see Note 10) Public Relations Feeding Program (see Note 11)
Over-all Total

Php Php Php

10,000 10,000 5,000 Php 25,000

Php

100,000

Php

75,000

Php 12,572,392

Notes are provided for in the Appendix.

VI.

Short and Long-Term Projection

In this analysis, we will look for the different costs involved in the production of Amigo

Segurado Spaghetti and then comparing it with the total sales to find out the minimum efficiency at which the plant should operate in order to have a neither loss nor profit relationship. This is done by finding the break-even point of operation. If the plant operates at the efficiency higher than that indicated by the break-even point, the plant is operating at a profit and vice versa. A. Break-even Analysis The cost involved in the production can be divided into two categories, fixed cost and variable cost.

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AMIGO SEGURADO Spaghetti Marketing Plan Fixed Costs The total fixed cost per year amounts to Php 2,555,646.17 calculated as follows: FIXED COSTS Fixed Costs (Except Utilities) Utilities Total Fixed Costs Fixed Costs (Except Utilities) According to FeedLink Philippines and quoted by Manila Bulletin Publishing this 2013, La Filipina Uy Gongco Corporation is investing Php 1 billion for pasta production, of which Php 250 million (US$ 6.12 million) to set up a pasta production facility. The annual fixed costs (except utilities) is Php 2.5 million by depreciating the total depreciable investments for 100 years without residual value. The fixed costs will include the following costs except for utilities: a) Land and Building This includes the cost of land and 200 square meter building which will be comprised of the main production area, packing room and storage area. The main production area will occupy around 50 square meters whereas the packing room and storage area will take up balance area. b) Plant and Machinery Marketing is the key success determinant and the production capacity has to be finalized accordingly. Keeping in mind the financial viability, the rated production capacity is assumed to be 140 tonnes per day with 300 working days and 2 shifts per day. This will necessitate the installation of the following machines: one extrusion machine one pre-conditioner FIXED COSTS (IN PHP) 2,500,000.00 55,646.17 2,555,646.17

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AMIGO SEGURADO Spaghetti Marketing Plan one mixer (50 kilogram capacity) one pouch packing and sealing machine one weighing scale

c) Miscellaneous Assets Other assets like furniture and fixtures, storage facilities, working tables and utensils will be incurred also. Utilities Based on an Indian Research on pasta industries, power requirement on working days shall be 20 horsepower (14.9139974 kilowatts) per day whereas per working day water requirement would be 500-550 liters (0.50-0.55 cubic meters). Power requirement per nonworking day will be 30% of that of the power requirement per working day or 4.4741992 kilowatts. Annual expenditure at full capacity utilization will be Php 55,646.17 as computed below based on March rates of Panay Electric Company (PECO) and Metro Iloilo Water District (MIWD). Requirement Per Day Rate Per Unit in Php (2013) Total Cost (in Php)

Utilities Water

Days

0.55 cubic meters (Working Days) Electricity (Working Days) Electricity (NonWorking Days) Total 14.9139974 kilowatts 4.4741992 kilowatts

300

16.5

2,722.50

300

11.1067

49,693.59

65

11.1067

3,230.08 55,646.17

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AMIGO SEGURADO Spaghetti Marketing Plan Variable Costs The variable cost per ton to be incurred by the corporation is as follows: Variable Costs Manpower Requirements Raw and Packing Materials Selling Expenses Total Variable Costs Per Ton Manpower Requirements Based on an Indian Research on pasta industries, the following workers (direct and indirect) are necessary for the production pasta. two machine operators two skilled workers for packing two semi-skilled workers two helpers two salesmen Using the Daily Minimum Wage Rates for Western Visayas for nonVariable Costs Per Ton (in Php) 5,935.71 48,750.00 19,260.00 73,945.71

agricultural/industrial/commercial sectors employing more than ten workers (effective May 31, 2012), each worker will earn Php 277.00 per day. The total salaries payable to the workers yearly at full regular hours will be Php 831,000.00 while the per ton salaries based on the 140-tonnes production capacity of the business is Php 5,935.71. Rate Per Day Workers Machine Operator Number (in Php) 2 277.00 300 Working Days (in Php) 166,200.00 Total Salaries

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AMIGO SEGURADO Spaghetti Marketing Plan Skilled Worker for Packing Two Semiskilled Worker Helper Salesman Total Raw and Packing Materials Amigo Segurado Spaghetti is made with the help of many ingredients with durum wheat as the major input. Other materials required are corn and rice flour, protein isolates, salt, spices, edible oil, and preservatives. All of them are easily available and packing materials are equally important. Pouches shall have to be printed and outer packing will be corrugated boxes. The average price of raw materials per ton is 50,000 Rupees (Php 37,500) while it is 15,000 Rupees (Php 11,250) per ton for packing materials according to the Hindu Business Line of 2010. The total raw and packing costs per ton is 65,000 Rupees (Php 48,750). Selling Expenses Marketing will be a key element. Expenses shall have to be incurred on transportation, publicity in local media like newspapers, hoardings and TV scroll, selling commission and free sampling. A provision of 20% of sales value is made every year to take care of these expenses since the product is new thus more emphasis is given on this section. This expense can be reduced once the product is well established in market. Establishing the selling price per kilogram of Amigo Segurado Spaghetti at the average market price of Php 96.30, the selling expenses will be Php 19,260 per ton computed as the 20% of Php 96.30 per kilogram multiplied by 1,000 kilograms per ton. Final Total Cost Analysis

277.00

300

166,200.00

2 2 2

277.00 277.00 277.00

300 300 300

166,200.00 166,200.00 166,200.00 831,000.00

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AMIGO SEGURADO Spaghetti Marketing Plan Costs Fixed Variable Analytical Break-Even Analysis Let the total production per year be x tonnes to arrive at the break-even point (in tonnes). 96,300x 2,555,646.17 73,945.71x 22,354.29x x = = = 0 2,555,646.17 114.32 tonnes Total (in Php) 2,555,646.17 73,945.71 per ton

Conclusion: The plant must operate at the minimum of 114.32 tonnes yearly in order to reach break-even analysis point. B. Sales Forecast For 2014 and 2015, the firm will be operating at 115 tonnes production which is a bit higher than the break-even analysis point since the product is new in the market. Sales (115 x Php 96,300) Variable costs (115 x Php 73,945.71) Fixed costs Net income Php Php 11,074,500.00 (8,503,756.65) (2,555,646.17) 15,097.18

For 2016, the firm will be operating at 3% higher than the production in the last two years or at 118.45 tonnes since it has established its name in the market and the variable selling expenses will be reduced to 15% of the sales price from 20%.

35

AMIGO SEGURADO Spaghetti Marketing Plan

Variable Costs Manpower Requirements Raw and Packing Materials Selling Expenses (Php 96,300 x 15%) Total Variable Cost Per Ton Sales (118.45 x Php 96,300)

Cost Per Ton (in Php) 5,935.71 48,750.00 14,445.00 69,130.71 Php 11,406,735.00 (8,188,532.60) (2,555,646.17) Php 662,556.23

Variable costs (118.45 x Php 69,130.71) Fixed costs Net income

For 2017, the firm will further be operating at 3% higher than the production in 2016 or at 122 tonnes and the variable selling expenses will remain at 15% of the sales price. Variable Costs Manpower Requirements Raw and Packing Materials Selling Expenses (Php 96,300 x 15%) Total Variable Cost Per Ton Sales (122 x Php 96,300) Variable costs (122 x Php 69,130.71) Fixed costs Net income Cost Per Ton (in Php) 5,935.71 48,750.00 14,445.00 69,130.71 Php 11,748,600.00 (8,433,946.62) (2,555,646.17) Php 759,007.21

For 2018, the firm will further be operating at 3% higher than the production in 2016 or

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AMIGO SEGURADO Spaghetti Marketing Plan at 125.66 tonnes and the variable selling expenses will be reduced to 10% of the sales price from 15% the preceding year. Variable Costs Manpower Requirements Raw and Packing Materials Selling Expenses (Php 96,300 x 10%) Total Variable Cost Per Ton Sales (125.66 x Php 96,300) Variable costs (125.66 x Php 64,315.71) Fixed costs Net income 64,315.71 Php 12,101,058.00 (8,081,912.12) (2,555,646.17) Php 1,463,499.71 Cost Per Ton (in Php) 5,935.71 48,750.00 9,630.00

VII.

Conclusion
This report outlines the marketing plan for Amigo Segurado. With existing demand for

Amigo Segurado products presently met by minor competition in the form of independent Pasta, this report puts forward the viability of launching the Amigo Segurado range of products in various flavors. Taking into account the absence of any existing brands in the market this report presents growth potential and profitably in serving this untapped market. Our paper focuses and limits its target market geographically to the Panay Island including the provinces of Iloilo, Antique, Aklan and Capiz. The primary target market is the mothers comprising the housewives, working or professionals who cook regularly or cater food preparations for family occasions. Base on the groups analysis of the market, other than the primary target market there can be potential target markets than could deliver huge amounts of

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AMIGO SEGURADO Spaghetti Marketing Plan sale for Amigo Segurado especially regarding the seasons that could greatly affect the targets markets buying behaviour. To address the Filipinos adventurous side, Amigo Segurado introduces the concept of Masarap bagayan. Under our pricing strategy, for a 1kg package of Amigo Segurado suggested retail price of the company is P56.80 thus the total cost that should be maximized must not exceed P49.39. This proposal needs an intensive dealer-distributor network that is desired on focusing on retailers as key channels for end consumers. Promotional strategy includes advertising strategy, activation strategy, sales promotion and public relations. For the advertising strategy, we have the print, broadcast and outdoor advertising. 11 universities and 5 malls are desired to accomplish our school activation and mall activation strategy. We will introduce also the concept of Amigo ng Bayan which includes a branded kiosk, promotion agents, direction stickers and attractive point of purchase (POP). Also, La Filipina Uygongco Corporation will sponsor a food assistance program in selected areas in Panay. An over-all launch budget of Php 12,572,392 is considered necessary to achieve this promotion strategy. To reach break-even analysis point, the plant must operate at the minimum of 114.32 tonnes yearly. In implementing this proposal the company expects to generate Php 15,097 in its first year of operation.

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AMIGO SEGURADO Spaghetti Marketing Plan

Appendix 1
Notes to the Launch Budget Note 1: Philippine Daily Inquirer 1/16 Page for 6 weeks (3rd week of Nov Last week of Dec) Php 8,232 * 6 = Note 2: Twice a day TV advertisement for 60days, one in the morning and one in the afternoon. Duration: 3rd last week of March, 3rd last week of November and whole month of December 30 sec commercial, afternoon spot for 60 days Php 150,000 * 60 = 30 sec commercial, morning spot for 60 days Php 23,000 * 60 = Subtotal Note 3: Love Radio Ad Package (Php 5000/ month) Banner Ad 160X160 30 second Ad spots 5 times a day Php 5,000 * 12 monts Note 4: Billboard Rent (Php 30,000/ month) for 12 months for 4 particular areas in Panay Php 30,000 * 12 months * 4 = Php 1,440,000 Php 60,000 Php 1,380,000 Php 10,380,000 Php 9,000,000 Php 49,392

Note 5: Direct Materials include cost of Spaghetti, cups and spoons, and other raw materials needed to carry out the Free taste in 11 selected universities and colleges around Panay (5 in Iloilo City and 2 universities each from Aklan, Antique and Capiz)

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AMIGO SEGURADO Spaghetti Marketing Plan Php 20,000 * 11 universities = Note 6: Php 1000 * 2 promotion agents * 11 universities = Note 7: Php 20,000 * 4 malls = Note 8: Php 1000 * 2 promotion agents * 4 malls = Note 9: Php 1000 * 10 days = Note 10: Php 10,000 * 10 winners = Note 11: Php 15000 * 5 preschools = Php 75,000 Php 100,000 Php 10,000 Php 8,000 Php 80,000 Php 22,000 Php 220,000

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AMIGO SEGURADO Spaghetti Marketing Plan

Appendix 2
Short and Long-Term Projections Break-even Analysis The cost involved in the production can be divided into two categories, fixed cost and variable cost. Fixed Costs FIXED COSTS Fixed Costs (Except Utilities) Utilities Total Fixed Costs Utilities Requirement Per Day 0.55 cubic meters 14.9139974 kilowatts 4.4741992 kilowatts Rate Per Unit in Php (2013) Total Cost (in Php) FIXED COSTS (IN PHP) 2,500,000.00 55,646.17 2,555,646.17

Utilities Water (Working Days) Electricity (Working Days) Electricity (Non-Working Days) Total

Days

300

16.5

2,722.50

300

11.1067

49,693.59

65

11.1067

3,230.08

55,646.17

41

AMIGO SEGURADO Spaghetti Marketing Plan Variable Costs The variable cost per ton to be incurred by the corporation is as follows: Variable Costs Manpower Requirements Raw and Packing Materials Selling Expenses Total Variable Costs Per Ton Manpower Requirements Rate Per Day Workers Machine Operator Skilled Worker for Packing Two Semiskilled Worker Helper Salesman Total Final Total Cost Analysis Costs Fixed Variable Total (in Php) 2,555,646.17 73,945.71 per ton Number (in Php) 2 277.00 300 Working Days (in Php) 166,200.00 Total Salaries Variable Costs Per Ton (in Php) 5,935.71 48,750.00 19,260.00 73,945.71

277.00

300

166,200.00

2 2 2

277.00 277.00 277.00

300 300 300

166,200.00 166,200.00 166,200.00 831,000.00

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AMIGO SEGURADO Spaghetti Marketing Plan Analytical Break-Even Analysis Let the total production per year be x tonnes to arrive at the break-even point (in tonnes). 96,300x 2,555,646.17 73,945.71x 22,354.29x x =0 = 2,555,646.17 = 114.32 tonnes

Conclusion: The plant must operate at the minimum of 114.32 tonnes yearly in order to reach break-even analysis point. B. Sales Forecast For 2014 and 2015, the firm will be operating at 115 tonnes production which is a bit higher than the break-even analysis point since the product is new in the market. Sales (115 x Php 96,300) Variable costs (115 x Php 73,945.71) Fixed costs Net income Php Php 11,074,500.00 (8,503,756.65) (2,555,646.17) 15,097.18

For 2016, the firm will be operating at 3% higher than the production in the last two years or at 118.45 tonnes since it has established its name in the market and the variable selling expenses will be reduced to 15% of the sales price from 20%. Variable Costs Manpower Requirements Raw and Packing Materials Selling Expenses (Php 96,300 x 15%) Cost Per Ton (in Php) 5,935.71 48,750.00 14,445.00

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AMIGO SEGURADO Spaghetti Marketing Plan Total Variable Cost Per Ton Sales (118.45 x Php 96,300) Php 11,406,735.00 (8,188,532.60) (2,555,646.17) Php 662,556.23 69,130.71

Variable costs (118.45 x Php 69,130.71) Fixed costs Net income

For 2017, the firm will further be operating at 3% higher than the production in 2016 or at 122 tonnes and the variable selling expenses will remain at 15% of the sales price. Variable Costs Manpower Requirements Raw and Packing Materials Selling Expenses (Php 96,300 x 15%) Total Variable Cost Per Ton Sales (122 x Php 96,300) Variable costs (122 x Php 69,130.71) Fixed costs Net income Cost Per Ton (in Php) 5,935.71 48,750.00 14,445.00 69,130.71 Php 11,748,600.00 (8,433,946.62) (2,555,646.17) Php 759,007.21

For 2018, the firm will further be operating at 3% higher than the production in 2016 or at 125.66 tonnes and the variable selling expenses will be reduced to 10% of the sales price from 15% the preceding year. Variable Costs Manpower Requirements Raw and Packing Materials Cost Per Ton (in Php) 5,935.71 48,750.00

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AMIGO SEGURADO Spaghetti Marketing Plan Selling Expenses (Php 96,300 x 10%) Total Variable Cost Per Ton Sales (125.66 x Php 96,300) Variable costs (125.66 x Php 64,315.71) Fixed costs Net income 64,315.71 Php 12,101,058.00 (8,081,912.12) (2,555,646.17) Php 1,463,499.71 9,630.00

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AMIGO SEGURADO Spaghetti Marketing Plan Bibliographies About Us: La Filipina Uy Gongco Corporation. Web. 28 Dec, 2012. <http://www.lfug.com.ph/> Amigo Segurado, . Web. 28 Dec, 2012.< https://www.facebook.com/AmigoSeguradoPH> Philippine Foremost Milling Corporation. Web 28 Dec, 2012. <http://www.philforemost.com/> Philippine Foremost Milling Corporation. Web 28 Dec, 2012. <https://www.facebook.com/pages/Philippine-Foremost-millingcorporation/106328576077860> Noel B. Carilo, MD . How to Start a Childrens Feeding Program. Web. 15 March, 2013. <http://showbizandstyle.inquirer.net/sim/sim/view/20100529-272740/How-to-Start-aChildrens-Feeding-Program. Rodolfo F. Florentino, Ma. Regina A. Pedro. The Food Assistance Program in the Philippines: The Issues Involved (Part 1 of 2). Web. 15 March, 2013. <http://www.fnri.dost.gov.ph/index.php?option=content&task=view&id=755> Rodolfo F. Florentino, Ma. Regina A. Pedro. The Food Assistance Program in the Philippines: The Issues Involved (Part 2 of 2). Web. 15 March, 2013. <http://www.fnri.dost.gov.ph/index.php?option=content&task=view&id=1098> An Overview of the Philippind Food Market. Agriculture and Agri-Food Canada. Web. 15 March, 2013. <http://www.ats-sea.agr.gc.ca/ase/6225-eng.htm.> Pasta and Noodles Market in the Philippines to 2014. Web. 15 March, 2013. <http://www.marketresearch.com/Datamonitor-v72/Pasta-Noodles-Philippines6391298/> Pasta and Noodles Market in the Philippines to 2014 Web. 15 March, 2013. <http://www.datamonitor.com/store/Product/pasta_and_noodles_market_in_the_philippi nes_to_2014?productid=DBCM8617>

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AMIGO SEGURADO Spaghetti Marketing Plan Euromonitor International, Pasta In The Philippines Web. 15 March, 2013. <http://www.marketresearch.com/Euromonitor-International-v746/Pasta-Philippines6741428/> Pasta and Noodles in the Philippines to 2013 Dec 2009. Web. 15 March, 2013. <http://www.researchandmarkets.com/reports/1195223/pasta_and_noodles_in_the_philip pines_to_2013 > Pasta and Noodles in the Philippines to 2013 Web. 15 March, 2013. <http://www.alacrastore.com/storecontent/Datamonitor_Premium_Research_ReportsPasta_and_Noodles_in_the_Philippines_to_2013-2122-1636> Universities and Colleges in Western Visayas, Philippines Web. 28 March, 2013. <http://www.finduniversity.ph/universities/western-visayas/> DTI Price Monitoring Report, 2011 IPO Annual Survey on World Pasta Industry, 2012

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