I.

TITLE

FOODRICH PHILIPPINE INC.

II. TIME CONTEXT

APRIL 2007

III. PERSPECTIVE/ VIEWPOINT

The viewpoint in this case is taken from Mr. Lorenzo Nayve who is the new
president of the Foodrich Philippine Inc.

IV. STATEMENT OF THE PROBLEM

 How will the company make to stay alive in the business world and prevent
bankruptcy?
 How can Foodrich Philippine Inc. (FPI) compete with other competitors in
food industry?

V. STATEMENT OF OBJECTIVES
This analysis wants to determine what would be the best strategies for Foodrich
Philippines Inc. to keep the business growing?

VI. AREAS OF CONSIDERATION

Strengths:
 They are the suppliers of seafood in most restaurants in Metro Manila.
 Consolidated net sales hit P2.5 billion with a growth or almost 48%.
  The strong sales growth could be attributed to an upsurge of orders from
Japan, Thailand, and South Korea.
 Company’s reliance on old established customers.
 Food is the Filipino family’s main expense on the total family
expenditures in 2003 and 2006.
 Profitability was further boosted by lower direct costs and restored
efficiency in operations.

Weaknesses:

 Lack of effective communication system.

 Poor inventory control and sales forecasting system.
 Old employees feel superior over the new employees.
 Cash flow is not properly monitored and it can lead to inefficient cash
flow management and eventually bankruptcy.
 The use of limited advertisements like flyers and radio.
 The product line has remained the same over the 10 years of operation.
 Not enough capital outlay to acquire the Betarich Piggery Farm.

Opportunities:

 Because of an improving economy, Filipinos have more money to buy the

food they want.
 More outlets were opened in the 2004 at various strategic places.
 They can make their technology more advanced that will create more
competitive advantage.
 Searching for new markets in Asia, Europe and Middle East for expansion
of target market.
 Angat and Lumpia Shanghai Banks are willing to extend loan facilities up
to the extent of the referred collaterals

Threats:
  The rising cost of real estate and property development that could hinder
the expansion
 Emerging of new competitors.
 Political and economic instability
 Rising prices of goods.
 The natural calamities that can lead to financial, environmental and/or
human losses.

VII. ALTERNATIVE COURSE OF ACTION

Alternative Course of Action 1

Acquire the Betarich Piggery Farm of Cecille Capul through equity swap.

Advantages:
• There will be a new product line for the business, thus, it can
increase the income of the company.
• They will have a chance to become the food provider of Asia.
• The raising of piggery does not require expensive housing,
equipment and labor requirements as compared to dairy and
poultry production.

Disadvantages:

• High cost of money is needed to buy the piggery and it means

higher risk.
• Buyers dictate the prices of market hogs especially if there is an
oversupply.
• The production of pig meat in 2002 to 2004 significantly decreased
due to foot and mouth disease, high production cost and calamities.

Alternative Course of Action 2

Find investors
 Advantages:

• New investors can bring new skills and opportunities to the

business.
• More investor means more money to expand the business.
• No need to pay an interest or repay a loan because the money come
from the investors not from the creditors.

Disadvantage:

• It is expensive and time consuming.

• Possibility of having only a small share of your business because
of more investors.
• You need to consult first your investors before making managerial
decisions.

Alternative Course of Action 3

Conduct workshop, training and seminars to the employees.

Advantages:

• It can create a good relationship among employees through

workshop and teambuilding.
• Nayvee has a chance to choose an ideal person who has the
potential to manage the other business of the company.
• It will help to motivate the people inside the organization.
• Their interest of working for the company will boost.
• There will be an effective communication system.
• Improvement in their work performance.
• They will be informed about the current status of the firm.

Disadvantages:

• Trainings and Seminars will increase the expense of the company.

 • It is time consuming, thus, causing delay for the future plans of the
business.
• Some of the seminars of the company tend to focus on theories
rather than application.
Alternative Course of Action 4
Use of online or television advertisements

Advantages:
• Advertisements will be a great help for the company to be well
known.
• Internet is one of the best channel to communicate with your
customers.
• Customers are slowly influenced and persuaded to try the product
they see on TV.

Disadvantages:

• Advertisements on TV will increase the expense of the company

• If it will be available in the internet, a lot of competitors may copy
the marketing materials of the company.

VIII. CONCLUSION

CRITERIA ACA 1 ACA 2 ACA 3 ACA 4

Increases Debt 2 3 4 1
Increase Profit 1 2 4 3
Timeliness 4 1 3 2
Total 7 6 11 6
Legend: 3 being the highest, 1 the lowest

To sum it up ACA 3 as the highest scale to take the risk for the increasing debts
but has a greater possibility for a higher return for the stability of the business.
IX. RECOMMENDATION

We further recommend the alternative course of action 3 which is to conduct

workshop, training, and seminars to the employees because given the advantages and
disadvantages of the different alternative courses of action this has the most number
of advantages.
Human is the most important resources and one of the greatest asset or liability of
a business and of course for them to be the asset of the company, you need to invest
first on your employees. Give them the seminars and trainings that they need for the
enhancement of themselves. It will help to have a harmonious relationship among
employees inside the organization and a well workplace environment that entices the
employees to work well and give their very best towards the goal of the company. If
you have an efficient employees, it will create a good corporate image that can attract
investors to capitalize in Foodrich Philippines and that what makes the company to be
able to compete with other competitors that will prevent bankruptcy with the help of
the investors.

X. PLAN OF ACTION

ACTIVITIES PERSON/S TIME FRAME

RESPONSIBLE
1. Assign adequate funds for the Lorenzo Nayve 1-6 months
workshop, trainings and seminars
that will be provided for the
employees.
2. Inform your employees about the Lorenzo Nayve and 1 week
importance of having seminars HR Manager
and trainings in an organization.
3. Create a schedule on when is the Lorenzo Nayve and 1-2 weeks
HR Manager
best date to conduct a seminar
and ask the insights of the
employees so they can feel that
they are involve in the planning
stage of this strategy.

4. Make sure that the topic that will HR Manager 1 week

be discussed is suitable for the
company’s present situation.
5. Hire the best and knowledgeable HR Manager 1 week
speakers so that the employees
will learn a lot from them.
6. Don’t use much on theories. Give HR Manager 1 month
them possible situations that they
can work with so the application
of it will be used in the future.
7. Give them not only the seminars HR Manager Continuous
or trainings but a continuous
monitoring if they are applying
what they’ve learned.
8. Choose an employee who you Lorenzo Nayve and the 1-3 months
think have the heart for the HR Manager
organization and give him/her a
chance to manage other business
of the company.