I.

Introduction
I.a. name of the corporation

I.b. background of the corporation

I.c. the market
I.d. the product [why create the product; product introduction]

II. Environmental Analysis

To fully assess the feasibility of the business idea of a fashion boutique shop
for petite women, EALA Inc. has made two key environmental analyses:
macro- and microenvironment analysis. The macro-environment analysis
takes into the account the political situation under the Philippine government;
the economic environment, which mentioned pertinent economic indicators
that are relevant to the analysis of the market and described the current
economic situation in the country; the cultural environment, which took note
of important socio-cultural demographics to better understand the target
market; and the technological environment, which listed capabilities that the
local garments industry has as of the moment. On the other hand, the micro-
environmental analysis focused on the garments industry in which the group
wishes to enter. The analysis discussed the developments and issues in the
local garments industry. In addition, as part of the micro-environmental
analysis, the group considered the retail trade in the Philippines as well as
possible competitors within the industry.

Macro-environment Analysis
Political Environment
The country is currently facing political instability, as there is a desire
to change our current political system to a parliament type, thus
creating a pessimistic hype for some potential long-term investors
because of possible negative political issues that loom ahead, which
can cause economic tribulations. Not to mention the unending
corruption issues of our politicians, the alleged election fraud and
corruption charges against the president and her family, the dawn of
value-added tax resulting to higher prices, and the time-to-time
resignation of the president’s economic team. Such political crises
negatively affect the profitability of the country’s businesses due to
rating outlook downgrades and higher interest rates. If debt levels
continue to decrease and higher foreign reserves were maintained,
there would be no major negative effect on business profitability.i

In the meantime, the country’s political crisis has brought international

credit rating companies to downgrade the country’s debt payment
credit ratings and also affected Asian Development Bank to threaten
the country with suspension of loans if fiscal and other reforms remain
stagnant if the political crisis would not be resolved.

The political crisis may not just negatively affect the country’s
economic performance, but may also damage the confidence of the
consumers and investors as well as hinder the developments in the
financial markets. Ultimately, the political crisis only serves to
aggravate the country’s external variability to global trends such as
ii
growth moderation, rising interest rates and oil prices.

Economic Environment
The strong influx of overseas Filipino workers’ dollar remittances and
increased tourism are the main economic drivers of the peso’s surge in
2005. At the end of the previous year, the peso had become one of the
best performing currencies in the world, hitting roughly PhP 52.00 per
U.S. Dollar. This is a proof that the Philippines is on a recuperating
stage after a long suffering from a weak economic base as a direct
result of political instability, higher interest rates, low credit ratings,
and other economic performance risks. If the momentum from last
year’s final quarter shall continue, it is projected that the Philippine
Economic System will continue to anticipate a positive outlook and
slow-but-sure growth.iii
However, basic commodities still has skyrocket-high prices and the
living condition today is getting even worse. The lack of local job
opportunities has also increased the trend of “brain drain” as more and
more Filipinos seek jobs abroad. These further on result in a steady
increase in the unemployment rate of Filipinos.

Major Economic Indicators

Gross National Product
As of the third quarter of last year, the Gross National Product, at
Current Prices, amounted to 4,150,771 million Pesos. There has been a
0.7 percent decrease in GNP, making the 2004 13.5 percent rate down
to the current 12.8 percent.iv

Gross Domestic Product

By the end of last year’s third quarter, Gross Domestic Product at
current prices amounted to 3,836,727 million Pesos. As compared to
the 14.1 percent GDP growth rate from 2004, there has been a big 3.7
percent decrease leaving 2005’s GDP down to 10.4 percent. However,
it is expected to grow approximately by 5.5 percent this year. The
expected growth in GDP in 2006 can be attributed to the growth in
personal consumption, the recovery in government spending, and also
the strong demand for export products.v

Personal Consumption Expenditurevi

Personal consumption expenditure is currently 72.9 percent of GNP, a
decrease from last year’s 73 percent, experiencing an annual change
of 5.8 percent.

Wage Rate
Currently, the minimum wage rate in Metro Manila is currently pegged
at PhP 288 to PhP 325 a day (eight working hours per day), the highest
among the regions. However, there is an ongoing legislation in
Congress to increase the minimum wages to cushion the impact of the
vii
expanded value-added tax on workers.

Inflation
As of the year ended 2005, Inflation rate rocketed to 7.6 percent from
the previous year’s 6.0 percent - a 1.6 percent difference. viii The
Bangko Sentral ng Pilipinas is targeting the inflation rate to average
between four to five percent in 2006. The inflation forecast for the
year, however, is placed at 7.5 to 8.2 percent. According to the BSP,
there is little sign of any inflationary pressures building in the
Philippine economy. The BSP Deputy Governor Diwa Guinigundo also
said that the planned rise in the sales tax to 12 percent from 10 in
February could cause an upward blip in inflation levels, but that would
ix
be short-lived. However, high oil prices will remain as the main threat
to inflation this year, which have already taken some of the buoyancy
out of consumer spending last year. But amidst the threats, the strong
peso and easing food prices help balance inflationary risks.

Foreign Exchange Rate

As the year opened, the Peso closed at its highest for the past eight
months at roughly PhP 52.00 a Dollar. If the political situation slowly
stabilizes, the country can experience a continuous lift in the peso.
Factors that can strengthen the peso include political stability, income
remittances from OFWs, inflows from portfolio investments, and
proceeds from government bond sale.x

The 2006 Fiscal program assumed that the average exchange rate
would settle at Php56.00 to a US Dollar, and that the benchmark 91-
xi
day Treasury bill rate would hit eight percent.

Value-added Tax
The month of February has been welcomed with the imposition of, the
new 12 percent value added tax. Moves by the government to raise
the level of value added tax (VAT) from 10 percent to 12 percent would
hit hardest the country's poor and its small businesses, the American
Chamber of Commerce of the Philippines said. They also asserted that
any increase in VAT would pose a serious burden on the country's poor
and small to medium size enterprises and would also lead to greater
tax avoidance. With the current minimum wage rates, it is highly
doubtful if the Filipino wage earner could absorb price hikes to be
triggered by the increase in VAT as well as other taxes. Employers
likewise may not be prepared to incur additional expenditures
particularly at this time of economic crises, concluded by the business
group.xii

Socio-cultural Environment
Demographics
Populationxiii
Population in the Philippines is increasing at a 1.84 percent growth rate
and is now currently pegged at 87.9 million Filipinos. The highest
concentration of people is found in the NCR, which is 12.98 percent of
the total population, Southern Tagalog, with 15.42 percent, Central
Luzon with 10.5 percent, and Western Visayas, with 8.12 percent.

The age structure of the population is divided into three brackets. The
first one is from 0-14 years old, which include 35.4 percent of the
population. The second bracket of ages 15 to 64 comprises of 60.6
percent of the population. The third age bracket, which is composed of
Filipinos 65 years old and above, covers only 4 percent. The median
age for males is 21.77 years whereas for females, it is only 22.8 years.

Based on the 2000 Census of Population and Housing taken by NSO, it

was found that there were more men composing the population with
50.4 percent than women with 49.6 percent. From 1995 to 2000, the
sex ratio was pegged at 101.4.

Labor Forcexiv
The total number of working people with ages 15 years and above is
pegged at 54,797,000, an estimated 35,496,000 of which is included in
the labor force, thus a 64.8 percent labor force participation rate.

The employment situation in the Philippines continues to improve with

a recorded increase of 3.6 percent in the number of employed. There
were 32.9 million reported employed this period compared to 31.7
million a year ago. Hence, the national employment rate is placed at
92.6 percent.

Starting April 2005, the new unemployment definition was adopted per
NSCB Resolution No. 15 dated October 20, 2004. As indicated in the
said resolution, the unemployed include all persons who are 15 years
old and over as of their last birthday and are reported as (1) without
work; AND (2) currently available for work; AND (3) seeking work OR
not seeking work due to valid reasons. Data shows that 2,620,000 are
unemployed, 48.8 percent of which were 15-24 years of age. Moreover,
61.6 percent of the total unemployed population were males while 38.4
percent were females.

Underemployment, on the other hand, is at 6,970,000 with a rate of

21.2 percent, a big jump from the 16.9 percent of the previous year.

According to the NSO’s Labor Force Survey, men and women comprise
61 and 39percent of the 2002 labor force, respectively. In addition, it
was found that women had a 51.7 percent labor participation rate
while men participated in the labor force at a rate of 80.8 percent.
Employment rate for women was 89.9 percent whereas men’s
employment rate was at 89.9 percent. In terms of major occupation
groups, majority of professionals, clerks and officials and special-
interest organizations, corporate executives, managers, managing
proprietors and supervisors were women. On the other hand, majority
of plant and machine operators and assemblers, farmers, foresters and
fishers, and tradespersons were men. In terms of major industry
groups, more women belonged in the education, health and social
work, and wholesale and retail trade industries while more men were
found to be dominant in the construction, transportation, storage and
communication, and fishing industries.

Consumption and Expenditurexv

According to the National Statistics Office Family Income and
Expenditure Survey Final Results released last January 12, 2006, the
average income vis-à-vis the average expenditure of the Filipino family
has been experiencing an increasing trend. Average yearly income
increased from 145,121 to 147,888, a 1.9 percent uplift from year 2000
to 2003. The target market of the business, which is NCR, was one of
the top three regions in terms of average income. The other two were
CALABARZON and Central Luzon. These top three regions posted
estimates of income that were higher than the average income of
148,757 pesos in 2003.

Average Expenditures are also escalating with numbers growing from

118,839 in 2000 to 123,690 in 2003 – that is a whopping 4.1 percent
increase.

On a different note, the Average Savings are lessening. From the

26,282 average savings in 2000, it decreased to 24,198 in 2003, a 7.9
percent decline. However, on the average, Filipino families in all
regions earned more than they spent, as stated in NSO’s 2003 Family
Income and Expenditure Survey results. In 2003, families located in
NCR showed the biggest annual saving of 46,923 pesos.

In 2004, personal consumption grew at a rate of 5.8 percent due to

double-digit growth of income remittances. In the first quarter of 2005,
there appeared a decrease in personal consumption expenditure,
which can be attributed to higher prices of goods and services. There
was a slowdown in growth for food, beverages, clothing and footwear,
household furnishings, household operations, and miscellaneous
expenditures as well as fuel, light and water due to low electricity
consumption. On the other hand, expenditures on transportation and
communication increased due to rise in road and railway ridership and
mobile phone usage.

Technological Environment
Industrialization
The manufacturing, along with the closely associated activities in the
clothing and garment production, continues to be one of the driving
forces of industrialization the world over. The clothing industries have
fought to maintain their share of the total value that is created
throughout the series of apparel design, manufacturing and
xvi
distribution.

Automation
At present, technology in the garment industry here in the Philippines
consists mainly of automation of the processes. These include the
automated designing of the patterns as well as that of fabric laying and
cutting. Electronically controlled mechanisms are also used for stitch
formation and fabric feeding for the basic sewing machines. The last
of the processes include automated machines and devices for pressing
the clothes.xvii In addition, current developments in machineries include
designs which enable fast adjustments of equipment from one style to
another thus eliminating the non-productive handling of fabrics and
garments. In the process, quality is thus being improved.xviii

Other Developments
The Garments and Textile Board of the Philippines has recently
installed an Electronic Data Interchange (EDI) system to reduce
processing time to help improve production and delivery lead-time. It
allows garment manufacturers-exporters (GMEs) to transact with
Garments and Textile Export Board (GTEB) electronically. The costs
associated with implementation of EDI include the costs for acquiring
the software and the hardware themselves, training and ongoing costs
 such as Value-Added Network (VAN) charges, maintenance and support
costs.xix In addition, the leading companies in the industry have started
to acquire CAD/CAM techniques, “Quick Response”, and “Just in Time”
philosophies to allow more flexible manufacturing.

Micro-environment Analysis
II.b.1. garments industry [historical background]
[research on Board of Investments of the Philippines
regarding graph of top exports in comparison with other
industries in terms of revenues]

III. Industry Analysis

Porter’s Five Forces Model
Buyers
Clothing is one of the three fundamental human needs. Everybody
needs to buy clothing. Clothing includes wearing apparel such as shirt,
pants, among others.
Pants, particularly denim jeans have been termed as the most popular
wearing apparel on earth.1 This clothing product is worn by almost
everybody thus, considering everyone as its consumer. However,
buyers usually buy in smaller quantities and do not purchase regularly.
Buyers can also easily switch from one competitor to another in case of
product dissatisfaction or if they just want to try other brands.

Personal consumption expenditures in the Philippines have been fairly

resistant to adverse changes in the past and in the current Asian crisis
as well. Although spending on clothes as a percentage of income has
been declining, percent total per capita expenditures on clothing have
been increasing, representing 47 billion pesos in 1997, a growth rate of
nearly 12.6 percent from 1991 to 1997.2

1
A Short History of Denim
2
Cotton Textile and Apparel Products
 Jeans customization is somewhat an old concept because of the
proliferation of tailoring shops. These shops cater buyers who can be
dissatisfied with the jeans available in the market or who just wants to
alter a jeans bought from a certain store. However, the idea of custom-
fit jeans is still a fresh concept in the garments industry, particularly in
the Philippines. Only few buyers, particularly those in the upper class,
avail/can avail these products because of the products’ perceived high-
end status and high price.

Suppliers
Denim has always been made of cotton. Philippine raw cotton
production supplies less than 3 percent of total domestic cotton
requirements, thus Philippines manufacturers continue to rely on
imports to meet domestic demand. The United States is likely to
remain the largest supplier of combed cotton, followed by Pakistan,
Australia and South Africa. With the end of the quota system for
garments starting in 2005, domestic cotton consumption is forecast to
decline next year. The garments and textile sector is the single largest
buyer of raw cotton and the garments sector is country's second
highest export earner.3

New Entrants
Barriers to entry include global and local policies implemented in the
textiles and clothing industry, capital requirements, access to
distribution channels, product differentiation, and cumulative
experience, among others.

For instance, the World Health Organization (WHO) Agreement on

Textiles and Clothing (ATC) took effect on January 1, 1995. Under its
provisions, the US negotiated market access with several developing
countries, including the Philippines, which are major exporters to the
US market. The Philippines agreed to improve access to its market.
Under this agreement the Philippines is obligated to reduce and bind
3
Philippine Cottons and Products
 tariffs, and to reduce and eliminate non tariff barriers. In line with its
commitments, the Philippines have bound its textile and apparel tariffs
at the following rates: 20 percent for yarn, 10-12.5 percent for man-
made fibers, 30 percent for sewing thread; 30-50 percent for floor
covering, and 30 percent for textile made-ups. Under its WHO
obligations, the Philippine Government initiated a general tariff
reduction program to reduce tariffs on raw materials to 3 percent and
on finished goods to 10 percent by 2003. In January, 2004, the
Government plans to introduce a uniform 5 percent tariff rate.

Another instance is Value-Added Tax applied to all imports, assessed at

10 percent of the value of goods, plus duty.

The Philippines is a member of ASEAN and a participant in the ASEAN

Free Trade Area (AFTA). AFTA contains a preferential tariff scheme
(CEPT) which requires intra-regional tariffs to be reduced to 0-5 percent
by the year 2003. Textiles are on a fast-track schedule for tariff
reductions to 0-5 percent by the year 2000. CEPT also requires intra-
regional reduction in non-tariff barriers and harmonization of customs
procedures and product standards.

The Philippine Government provides incentives to promote investment

in preferred activities and geographic areas and for export. Investment
incentives include: income tax holidays; tax deductions for labor
expenses, infrastructure, capital equipment and spare parts, and
investment in less-developed areas. On the other hand, export
incentives include: exemption from advance payment of customs
duties; tax credits for imported raw materials and spare parts,
domestic substitution of imports, export revenue; and various
exemptions for duty on imports. A variety of financing programs and
guarantee schemes is available through state-sponsored institutions.4

4
Cotton Textile and Apparel Products
 Capital requirements include high-speed and highly-efficient sewing
machines, high-quality denim fabric, among others. Human resources
in the form of tailors are also essential in this business.

New entrants will not find it difficult to meet distribution network

requirements since there are various alternative channels for them to
sell their products. New entrants can easily distribute their products
without having to invest in creating new distribution networks.

Product and service differentiation requires vast outlays in several

stages of the value chain, most especially in advertising and
promotion.

Learning curve effects make a difference as companies with more

experience gain advantage through having more cost-efficient
manufacturing processes.

Substitute Products
Ready-made retail products are considered substitutes for custom-
made clothing. Moreover, denim pants could be replaced by shorts and
skirts as bottom apparel. The denim fabric could also be replaced by
other fabrics such as those used in khaki pants and slacks.

Industry Competitors
The Philippine garment industry dates to the 1950s and the emergence
of cottage-level industries that replaced homework. As the industry
began exporting during the 1970s, it experienced rapid growth,
growing an average of 30 percent between 1972 and 1980. The
industry is at a crossroads of uncertainty regarding the effects of global
trade liberalization. It is expected that the removal of quotas will cause
further erosion in the industry, with only larger, well-capitalized firms
able to survive.5

5
Cotton Textile and Apparel Products in Philippines
 The garment industry is comprised of many players, both operating on
a large scale and small scale basis. The industry is a growing one;
exports of garments are steadily increasing too as more foreign
companies continues to trust the skills of local manufacturers in
producing quality garments. The local garments and textile industry is
the country's consistent second top performer in terms of export
revenue. The Philippines is also one of the main product suppliers for
high-end clothing brands such as GAP, Old Navy, Ann Taylor, Liz
Clairborne, and Polo Ralph Lauren.6

Customers are free to change their suppliers thus creating high

uncertainty for competitors. In terms of origin and operating styles,
competitors may range from boutiques, specialty stores, bazaars,
tiangges, direct selling agents, department stores to big malls.

A relatively large amount of money is tied in equipments such as high-

speed sewing machines and inventories, but liquidating such assets is
relatively easy.

IV. Competitor Analysis [EARVIN]

IV.a. competitor map
IV.b. competitor profiling
[determine direct competitors  Viktor jeans and tailoring
shops; research on background and strategies]
IV.c. price profile
IV.d. competitor SW analysis

V. Marketing Research
In order to gather relevant and sufficient data for this feasibility study, EALA
Inc. devised a market research instrument, in the form of a self-administered
survey, on the jean-preference and buying behavior of the target market.
6
Behind the Seams http://www.philippinebusiness.com.ph/archives/magazine/vol11-2004/11-/forecast.htm\
EALA Inc. sought the help of a statistician in the person of Ms. Sunshine Ong,
a BS Statistics graduate from the University of the Philippines- Diliman, to aid
in the development of a research instrument, selection of a suitable sampling
method, and processing of relevant statistical data.

VI. Sampling Plan [ANNA]

VI.a. mode of sampling [cluster sampling]
VI.b. determine market
VI.c. identify persons surveyed
VI.d. 3 clusters [Katipunan, UP Village, Blue Ridge]

VII. Market Demand Forecast [ANNA]

VII.a. consumption rate

VIII. Supply Analysis [EARVIN]

VIII.a. current supply of competitors

IX. Market Share [BASED ON SURVEY]

X. Sales Forecast [BASED ON SURVEY]

XI. Market Segmentation

The distinction of one segment from another in terms of needs,
characteristics, interests and values necessitates dividing the market into
segments, as these differences will greatly influence the responses and
attitudes of people towards the products and services offered by EALA Inc..
Market segmentation was conducted in order to select the group of people
who will be most receptive to the products and services offered by EALA Inc..

The market for consumers was segmented based on their geographical,

demographic, psychographic, and behavioral indicators that influence their
purchases for jeans.

Geographic Segmentation
EALA Inc. subdivided the market into location-based segments
(residential areas within a XX-kilometer radius from the location of the
proposed business) because consumers’ wants and product usage are
often related to one or more of these subcategories. Also, this
geographic measure is measurable and accessible.

The distribution of population in these areas is important to the

company because the market within these areas generally tend to
share similar values, attitudes, and style preferences. Despite the
similarities, significant differences still exist among these residents
because of differences in their culture, social customs, upbringing, and
other factors. Hence, other factors need to be considered.

Demographic Segmentation
Demographics was also one of the indicators considered by Pantsaloon.
The most popular combination of factors include age, family, life cycle
stage, income, occupation and education.

Age
EALA Inc. segmented the market to cater to 17 – 29 year-olds. The
reason for this is that this segment shows the highest demand for
Pantsaloon’s products.

Primarily composed of college students and young, urban professionals

(yuppies), this age segment is the most prominent user of jeans. With
a myriad of jean brands in the market, catering to college students and
yuppies appear to be one of the most lucrative trends in the jeans
industry.

Income
The consumer’s level of income is an important factor in the profiling
of Pantsaloon’s market, as income is an effective indicator that reflects
the buying power and spending habits of the students and yuppies for
whom the products are made for.

The growing purchasing power of this age bracket is the primary factor
making this age bracket attractive. For yuppies, the trend is being
fuelled by higher disposable incomes resulting from more generous
allowances and salaries. On the other hand, college students opting to
work part-time during schooling, and heightened media awareness
augments their purchasing power.

Life Cycle Stage

People’s demand for goods and services change over time to adapt to
their likewise changing needs and want. Hence, there is a need to
segment the market based on their current life-cycle stage.

A bachelor, having no family to support and most probably still under

the custody of his parents, is more inclined to make purchases for
himself, and clothing is definitely included in his expenditures. This
being the case, the Bachelor stage seems to be the most appropriate
for the product Pantsaloon offers. Young, single, individualistic and
independent, the Bachelor is definitely made for Pantsaloon.

Occupation and Education

Pantsaloon segmented the market to college students and young
professionals. For the purpose of embodying what the individualistic
youth is, this segmentation is important because Pantsaloon’s products
and advertising will be more concentrated on them.
Psychographic Segmentation
The types of products and brands an individual purchases reflect that
person’s characteristics and patterns of living. Pantsaloon, in
evaluating the psychographic segments of the market, divided the
group based on personality characteristics, lifestyle, and values. These
attributes were examined and eventually related to how an individual
in the market thinks, feels, and behaves.

Personality Characteristics
The college student and yuppies market is a dynamic and extremely
competitive environment. Though there are plenty of opportunities for
new entrants and a great scope for innovation, the target audience is
extremely hard to please.

Media influence, including fashion, television, the Internet and music,

make the market savvy about what they want. Quality will unlikely be
compromised, and approach to brand loyalty is erratic

However, the nature of Pantsaloon’s enterprise being customization, it

won’t be difficult for the business to keep up with the market’s
unpredictability. Changing fashions won’t be much of a problem, as
jeans have become a staple piece of clothing, and only their styles
change through time. This quick shift from one style to another is a
strength that Pantsaloon can play up.

Having the products and services evolve with the moment, together
with extensive and focused marketing efforts, Pantsaloon hopes to
retain the interest and loyalty of the market in consideration.

College students and yuppies, at their young age, are attracted by fun,
glamorous and distinctive brands. Finally, while they have a strong
desire to be like everyone else, they still have a very strong need to
express their individuality.
Lifestyle
As mentioned previously, the target market combines a desire for
belonging and a need to express their uniqueness. Joining the
bandwagon is prevalent among them, with cliques and barkadas being
a common thing in this age bracket. In fact, people are usually first
identified with the group of people they hang out with before they get
to be recognized as individuals.

The trends dictated by society, media, and the people around them
influence their lifestyle and behavior, and being updated with the
latest in fashion, music, movies, electronic gadgets and the like is as
important as expressing their individual selves.

Behavioral Segmentation
(will be based on survey results)

Occasions
Most college students purchase clothes, i.e. in this case, t-shirts, when
they most have money. Out of 824 valid respondents, they buy their
shirts during the 2nd and 4th quarter months (April, May, June, and
October, November, December), as indicated from the market survey
conducted. Below is a graph of the number of college students buying
t-shirts divided into quarters.

June is a month when classes usually start. It is reasonable to conclude

that most likely, they would buy shirts to wear throughout the new
school year. The Christmas Season occurs during the month of
December. Gift-giving is prevalent and monetary presents are given.
Thus, giving our target market more money to spend, and more
reasons to purchase t-shirts (as a gift, for instance).

Benefits Sought
 The graph below indicates the importance of several characteristics
considered by college students in buying a t-shirt. 5 is considered most
important while 0 means not considered at all. Most important benefits
sought are wellness of fit, type of fabric, and design of prints. Ranking
next are price and style of shirt. Price, on the other hand, is not very
important to them.

Usage Rate
The level of usage college students make of t-shirts is HEAVY.
According to the survey conducted, 52% purchase 2-5 shirts on a 6-
month basis, 30% purchase 6-9 shirts, 8% purchase less than two
shirts, 6% purchase 10-13 shirts, and 4% purchase more than 13
shirts.

User Status
Much like everyone else, college students are jean regulars. Jeans,
classified within the clothing category, are commodities/necessities
that are a part of their everyday life.

Yuppies on the other hand, wear jeans less often, relative to the
younger college students. However, as part of their “self-centered”
lifestyle includes going out often, jeans are still a staple in their closets.

Loyalty Status
As stated earlier, this particular age bracket is erratic and
unpredictable in their approach to brand loyalty. Categorized as
“Switchers”, they do not automatically seek out a particular brand, but
more often purchase the brand available to them or that which caters
to their taste and preference.

(also survey-based)

Buyer Readiness Stage

 88% of the respondents of W.I.T.’s market survey indicate that they are
willing to buy the concept t-shirts W.I.T. offer. This segmentation model
will be particularly useful in formulating and monitoring the marketing
communication strategies W.I.T. will employ to move consumers
towards purchase of a product or brand.

XII. Market Targeting

Pantsaloon, as a customized and tailored-to-fit jeans boutique, will focus on
the needs of our market specifically as follows: (1) upper class male and
female residents near our location (Katipunan area, Loyola Grand Villas, La
Vista, Loyola Heights, Blue Ridge, White Plains, UP Village, etc.); (2) male and
female students (specifically college students from Miriam College, Ateneo de
Manila University and University of the Philippines-Diliman); and (3) young
male and female professionals not more than 29 years of age.

EALA Inc. subdivided the market into location-based segments (residential

areas within a common radius from the location of the proposed business)
because this geographic measure is quantifiable and accessible. The
distribution of population in these areas is important to the company because
the market within these areas generally tend to share similar values,
attitudes, and style preferences, given that they are in the same level of
social class. Despite the similarities, significant differences still exist among
these residents because of differences in their culture, social customs,
upbringing, and other factors. Hence, other factors need to be considered.

College students, specifically from Ateneo de Manila University and UP-

Diliman, do not have school uniforms. Thus, denim jeans have been a staple
clothing item for them. But with different body structures as well as different
tastes in denim jeans, Pantsaloon aims to address their dilemma on those
differences. Furthermore, individuality is important to these particular
individuals, thus Pantsaloon’s concept of customization would definitely cater
to their need of distinctiveness. Miriam College students, on the other hand,
are known for their flair for fashion thus, including them as part of
Pantsaloon’s market.

Young professionals also have this need of uniqueness and standing out
among others. They make sure that they are distinctively different from
others, whatever it takes. Having their own source of income lets them
address this need.

Pantsaloon custom-fit jeans cater to both genders—male and female. Though

females are more known to be fashionable and vain, males nowadays are
also into fashion. Metrosexuality has been a coined term for males that
address their feminine side—the need to look good.

XIII. Market Positioning [EARVIN]

XIII.a. positioning statement
XIII.b. meaning of brand

XIV. Marketing Mix [EARVIN / BASED ON SURVEY]

XIV.a. price [based on survey]
XIV.b. product
XIV.c. place
XIV.d. promotions
i
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“Rating Firms’ Outlook on RP Turns Negative.” [Online] Available

ii

http://www.bworld.com.ph/BW071205/topstory.php, August 2005.

“Business Upbeat on Economy”, B5 Business Section, The Philippine Daily Inquirer,

iii

January 25, 2006

“National Accounts Third Quarter 2005” [Online] Available

iv

http://census.gov.ph, January 11, 2006

v
“Selected Economic and Financial Indicators.” [Online] Available
http://www.bsp.gov.ph/statistics/sefi/sefip1_files/filelist.xml, August 2005.
vi
“Selected Economic and Financial Indicators.” [Online] Available
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Gil C. Cabaccungan, Jerome Aning, “Palace: It’s Time Congress Enacted Wage
vii

Increase”[Online] Available
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viii
“Economic Statistics.” [Online] Available
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ix
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January 25, 2006
x
“Worst Over For Philippine Debt, Says Poll; Peso, Stocks Up.” [Online] Available
http://money.inq7.net/topstories/view_topstories.php?yyyy=2005&mon=07&dd=19&file=
1, July 19, 2005.
xi
“Government Expects Billions in Savings” The Philippine Daily Inquirer.
January 23, 2006

“Increase in VAT will hurt poor, small businesses”. [Online] Available

xii

http://www.inq7.net, January 27, 2006

“Philippines Population Expected to Reach 100 Million Filipinos” [Online] Available

xiii

http://www.census.com.ph, October 16, 2002

“Philippine Labor Force Survey” [Online] Available

xiv

http://census.com.ph, October 2005

xv
“Family Income and Expenditure Survey” [Online] Available
http://www.census.com.ph, January 12, 2006

Byrne, Chris. “The Impact of New Technology in the Clothing Industry: Outlook to 2000”
xvi

[Paper]
xvii
“Clothing Engineering.” [Online] Available
http://www.fs.uni-mb.si/en/study/ects/IP%20-%20Clothing%20engineering.pdf

Dueñas-Caparas, Ma. Teresa. “State of Competition in the Wholesale and Retail Sector”
xviii

[Paper]
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