De La Salle University

Graduate School of Business

GARDENIA BAKERIES

This and the country’s large pool of working class citizen possess growth opportunities for Gardenia.0Statement of the Problem Given its essentially secured position as the market leader in the bread industry in terms of shelf space. Its unparalleled distribution network allows it to easily penetrate market and filter down its products to each Filipino home. what strategies and marketing efforts should it implement to maintain. with the other major players trailing behind. Its product quality and wide distribution network.Executive Summary Gardenia Bakeries Philippines is currently the market leader in the bread and wheat industry. Catering both the needs of upper and the price-conscious markets. As of 2010. . it has committed itself in providing fresh bread all over the country. coupled by massive advertisement. hence any price changes affect the margins of the company. Social mobility in the Philippines is also considered to be one of the more dynamic in Asia. it has since dominated the market. catapulted the Gardenia into a household name. Philippines. bargaining power is in favor of the consumers. if not bolster. allowing it to be the top of the mind brand. However. as evidenced by the fresh investment made in 2010 via new plant in Mactan to reach other parts of Visayas and Northern Mindanao. Situation Analysis 1. affordability and convenience. despite the increase in prices. market coverage and share. is considered among the next 11 economies. believed to have the high potential of becoming the next largest economies. the middle class accounts for almost a quarter of the total population of the country. milk and fuel at low prices. Nevertheless.0Market Summary Gardenia Bakeries Philippines’ target market is mainly the middle class whose selling point is to quality. 2. since bread is an easily substitutable food. commanding comfortable shares of 65% and 90% respectively. Gardenia products are particularly vulnerable to inflation. Gardenia Bakeries’ mission includes eventually venturing into beverage products to complement its bread product line. its market share. Although global market price remains stable and holidays on tariff allow purchase of input materials such as flour. consumption of bread continuously increased over the past years. sugar. Production-wise. Importation and exportation of the same likewise have steadily been growing.

Growing economy and rising middle class 2. Supported by a conglomerate with proven market success (QAF Group) 5. Growing flank product lines 6. 2. 6.0SWOT Analysis Strengths 1. Bargaining power of retailers 3. Rice 2. 3. Perceived superior quality products (freshness and taste. Convergence of competitors 2.000 loaves per day) 3. awards) 2. Inflation and tariff 4. Limited availability/penetration to lower-end market (sachet economy) 2. Julie’s Bakeshop Goldilocks Bakeshop Generic bakeshops that are easily accessible Other bread manufacturers able to penetrate retailers Indirect Competitors 1. Crackers .0Competition Direct Competitors 1. crackers and other cereals. but also cross-over to alternatives like rice. However. Wide coverage and distribution. it should be noted that the price sensitivity of the target market not only allows brand switching offering similar products. consumer spending on bread has been continuously growing. 3. Global economic crisis 4. Multi-awarded company Weaknesses 1.Meanwhile. Improvement on market coverage and distribution Threats 1. and top the line production (extensive territorial distributors. 4. No stand-alone stores Opportunities 1. Ability to make rapid expansion 4.

given its current standing in the market. Gardenia Bakeries. reliability and availability. Gardenia launched Gardenia Pedicart to allow door-to-door delivery of goods. Meanwhile. frequent usage.000 loaves per day and product line to more than 30 products.0Distribution In terms of distribution. Gardenia has since enjoyed an unprecedented growth in both sales and market share. this strategy would also allow Gardenia to minimize intermediaries. Marketing Strategy 1. Recently. enabling better inventory and logistics control. allowing the company to peg its products slightly higher than the other players. corn or any readily-available food. Its use of territorial distribution logistics complemented its delivery containers to cover most of Luzon and parts of Visayas and Mindanao.000 loaves per day in 1998. would allow it to either set up a new plant in Mindanao area to capture the underserved area.3. The continued patronage of the market and weak competition has allowed it to expand its production to at present of 6. 2. A detailed list of the products is attached hereto as Annex A. crackers. Pasta 4. cereal. Gardenia’s main value proposition is its product quality and superior taste.0 Strategies New users can be in the form of new customers. 6. and (c) find new uses of product. Not only would it create jobs.0Product Offering Started at production level of 2. to capture non-users such as those who rely on rice. maintain. tapping the need of market on ensuring freshness. to penetrate the base of the income pyramid. is by far. grow and protect its position in the market by focused on the following: (a) acquire new customers. the widest nationwide. Gardenia Bakeries. Other alternatives to bread as merienda or staple food 5. The recent heightened consciousness of the Filipino market on health created an opportunity for Gardenia to bank on its product quality to associate itself with healthy living. Inc. Gardenia should craft and organize objective should be A market leader can employing strategies (b) encourage more .0 Objectives The group believes that Gardenia Bakeries’ expansionary. with its sound financial position and affiliation.

Citing years of relationship since 1997 would send a message to the consumers of the continuing commitment of the company in ensuring quality food in every table. To defend its market share from “cottage” bakeshops as well as the emerging franchise like Julie’s Bakeshop. 3. relaxing is luxury. Understanding the needs results in a more concerted marketing efforts and proper segmentation and positioning of products. Gardenia should be mindful of any business dealings that might prelude this to make pre-emptive counter-measure strategies. or similar group that has the financial capability to develop and distribute products to compete head-to-head with Gardenia should also be considered. Gardenia should further strengthen its Gardenia Pushcarts to enable improved penetration on grassroots level. stepping out from its usual bread as sandwich or merienda image. Dedicated salesmen should be assigned on this particular project to facilitate feedback mechanism. This. Gardenia should reinforce market’s association with the product. diversification of products could also be an alternative. Even for market leader like Gardenia Bakeries. Gokongwei Group. Entering the beverage or bread spread industries. Finally. On the other hand. Financial and Control . reminiscent of Jollibee’s Mang Pepe. One example of creating a desire is by engaging the services of celebrities which the target market can highly associate themselves with. The changing preference and desires of customers continuously shape and reshape the market profile. can establish a new company that would specifically cater the underserved market. Gardenia can find creative ways on how to stretch use of its products. behemoth conglomerates like San Miguel Group. or Gardenia. For increased/more frequent usage. would serve as flankers to the core product line of Gardenia Bakeries.marketing efforts to create a desire for the products. if it would like to maintain its current branding and market image. Years of uninterrupted dominance in market would give Gardenia the advantage over the new entrants.0 Market Research Sustained market research is often necessary to ensure that all product developments are attuned to the needs of the target market. freshness in every bite. Market research not only gives feedback mechanism but also sets the foundation for appropriate control measures. while risky. To protect its position in the market.

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