PESTEL ANALYSIS

Political
Strict mining regulation which affects the production of tin cans
Contractualization of factory workers

Economical
Strong export demand for products
o According to Tuna Canners Association of the Philippines
(TCAP), in the year 2014 the export value of tuna in US
dollar was 257,696.20
High cost due to canning and packing
Inflation

Socio-cultural
For health conscious people because it produces omega-3 oils
and all those added health benefits
Affordable and accessible
Halal registered company
People nowadays want instant products due to busy schedules

Technological
Have their own fishing equipments
Have their own canning and packing facilities

Environmental
Waste disposal of canned and packed tuna and sardines
Abiding the fisheries management and policies of Department of
Environment and Natural Resources which is the protection of
fish habitat.

Legal Context
Lower Taxes
Corporate Social Responsibility

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PORTERS FIVE FORCES MODEL

Power of buyers
Buyers pressure the company to reduce the price and improve the quality of
the products. The following are the external factors that contribute to the
strong bargaining power of buyers:

Low switching costs (strong force)

Large number of providers (strong force)
High availability of substitutes (strong force)

Customers can easily shift to other brands of sardines and tuna because it
is affordable to do so and the availability of other products is high. Due to
market saturation, customers can choose from many different companies
who also offer the same product. The number of substitutes of this product is
also high making it easy for the customers to choose the latter.
Power of Suppliers
Suppliers threaten companies with increasing prices for goods or services.
This force shows the impact of suppliers on firms. The weak bargaining
power of suppliers is based on the following external factors:

Large number of suppliers (weak force)

High overall supply (weak force)

Malaya Corporation can just find alternative suppliers if their supplier

cannot provide them and also if the suppliers will tend to make the price
higher. Thus, this analysis shows that supplier power is a minimal issue for
the corporation.
Threats of New Entrants
The possibility that new firms may enter the industry also affects
competition. Wilkinson (2013) states that if it is easy for new entrants to
enter the market if entry barriers are low this acts a threat to the
organizations already competing in the market. The following external factors
contribute to the force of the threat of new entrants:

Cost of brand development (strong force)

High cost of doing business (strong force)

It is costly to develop a new entrants brand. The high cost of doing

business further limits new entrants ability to disrupt the industry
environment.
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Threats of Substitutes
Malaya experiences a strong force of the threat of substitutes. The
availability of a substitution threat affects the profitability of an enterprise
because consumers can choose to purchase the replacement instead of the
industry's product (Hines, 2013 ). The following external factors contribute to
the strong force of the threat to substitutes:

Availability of substitutes (strong force)

Low switching costs (strong force)
Price of substitutes (weak force)

There are many substitutes to the products of Malaya Corporation. It

could be that customers could switch to fresh foods rather than canned
products. It is very easy for the customers to shift to substitutes in other
brands such as the ones offered by Mega Fishing Corporation and Century
Canning Corporation, etc.
Competitive Rivalry
The depth of rivalry among competitors in a trade applies to the
degree to which firms within an industry put weight on one another and limit
each other's profit potential (Wilkinson, 2013). The following are factors that
create a strong force of rivalry against Malaya Corporation:

High number of competitors (strong force)

High aggressiveness of sardines and tuna companies (strong force)
Variety of firms (strong force)

Malaya Corporation has a lot of competitors specifically those already

popular in the market such as Mega Fishing Corporation and Century Canning
Corp. The strong force of competition is also due to the low switching cost,
which means that it is easy for customers to shift to other brands. The
competition in this industry is high; companies are very aggressive.

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Threat of Substitution
bility of substitutes (strong force)
witching costs (strong force)
Supplier Power
f substitutes (weak force)
Large number of suppliers (weak force)
High overall supply (weak force)

Threat of New Entry

Cost of brand development (stron
High cost of doing business
(strong force)

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