CHAPTER I

THE PROBLEM AND ITS SETTING

BACKGROUND OF THE STUDY
There are two kind of buying behavior, the one who buys the bigger or bulk
product and the one who buys the break bulk or sachet type of products. Sachet
“smaller” type or Break Bulk, which is commonly called “Tingi”, the micro form of an
existing product offered to the market for a lower price. Sachet type of product
continues to be immensely popular in the Filipino consumers. While, the Bottle “Bigger”
type, is a large portion, great size or big volume, rigid container of a product offered to
the market. Filipino consumers are vulnerable and aware of difficult times ahead.
Sachets and other small pack sizes' lower cash outlay allow them to do so.
There are several brands out there and a wide variety of items per brand that vie
for the consumer attention and money. With tons of option available to consumers,
shopping has become easy and convenient which brings us to the affordable and evenso-dependable “Tingi” or Break Bulk.
Sachets strongly appeal to the “bottom of the pyramid” market. But the Filipino
consumers are still patronizing smaller packaged products and a sachet has bloated the
shopping trips of Filipinos. When Filipinos shop, the amount of money they have to shell
out is still a very important factor.
Filipino Consumers look for cheaper options and prioritize buying the things
needed the most. It’s not all about price, though, determining on the price basis or the
loyalty of a certain products is concerned in the purchasing power of a Filipino
consumer. Filipinos remain highly concerned about health. They care about how they
look and place importance on time. The purchase of health and convenience products

Consumer Behavior

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Cheaper local brands are on the rise. RESEARCH PROBLEM AND OBJECTIVES The objective of this research is to determine the effectiveness of break bulk on selected products in affecting the buying preference of the Filipino consumers and to answer the following questions: It aims to answer the following specific problems: A.) What are the factors considered by the consumers in buying sachet type and bottle type of products in terms of: b. and bleach and hair conditioner is growing. Is it because of their Income? Convenience? Quantity? Quality. feel the growing presence of these emerging brands. a lot of which are multinational names.3 Education/Occupation a. More important is to find out the reasons behind consumers' purchasing power.like milk powder. soymilk.2 Gender a.2 Packaging b.) What is the demographic profile in terms of: a.3 Price Value b. ready-to-drink tea.1 Age a. yogurt drinks. oatmeal.5 Usage Control Consumer Behavior Page 2 .4 Quality value b.4 Income/Allowances B. liquid soap. Product category leaders.1 Convenience b.

) What selling style the does the respondents prefer between Sachet and Bottled type of products in terms of: d.C.) How effective is break bulk to the consumer? F.3 Packaging d.2 Convenience c.1 Advertisement & Promotion c.2 Affordability d.4 Price Value D.4 Price Value d.) Why do Consumers patronize break bulk products? Consumer Behavior Page 3 .) How do the respondents compare the sachet type and bottled type of products in terms of: c.5 Usage Control E.1 Advertisement d.3 Packaging c.

HYPOTHESIS In line with the topic and its objectives. the researchers came up with a Null Hypothesis. Null Hypothesis Break Bulk “Tingi” on selected products has no significance to persuade the consumers’ on their buying preference. Consumer Behavior Page 4 .

Consumer Behavior Page 5 . It shows that the study will utilize the effectiveness of break bulk as its input for determining the intervening variables which are the demographic profile of customers. determinants considered by the consumers.CONCEPTUAL FRAMEWORK Figure 1.Conceptual Framework The flow of the research is based on the conceptual framework illustrated above. comparison of break bulk and bigger retail products and respondents’ preferred retailing style in order distinguish the effects in the purchasing power of consumers in their buying behavior or preference.

Based on the possible results that the researchers may attain. The study is geographically placed at: Puregold Paco. San Roque in Tondo. price and convenience.the study will help the entrepreneurs to gain insight about consumers’ wants. It will also help them decide on the products that they may purchase. It will show how the Filipino purchases products and how much they patronize the break bulk “tingi” (sachet) on selected products. this study may benefit the following: • Consumers. Specifically under the buying category which can assist in providing solutions to the study. Consumer Behavior Page 6 . SCOPE AND LIMITATIONS OF THE STUDY This research intends to analyze the behavior of a consumer through their buying behavior. • Researchers – the study can serve as a guide and reference to other future researches and inquiries in relation to the retailing business in the Philippines. Ultramega in Divisoria. and Robinson’s Manila Supermarket. where we can see how the Filipinos purchases goods or services. • Entrepreneurs.SIGNIFICANCE OF THE STUDY The primary purpose of the study is to determine the new trend affecting the purchasing power of consumer in their buying behaviour or preference. The purpose of this research is to conduct an analysis on the effective trend in persuading the consumers’ on their buying preference.the study will help the consumers know the difference between bulk and sachet products. needs and perception in terms of quality.

Price .consumers that are resident of the Philippines and/or has a Filipino blood.the decision processes and acts of people involved in buying and using products. 7. 5. Determinant . The researchers chose this type of respondents because these people are the ones who are mainly involved with the study. The respondents are mainly the person who comes in and out of the grocery or supermarket. Filipino Consumers .refers to raising customer awareness of a product or brand. broadcast. DEFINITION OF TERMS 1. Convenience . Promotion . generating Consumer Behavior Page 7 . as a product or business. Break Bulk . In order to clarify the survey questions. We use the term “break bulk“ (sachet) for products that contain The researchers will conduct different types of statistical methods that will provide the answers to the problems. Bottle type – is a rigid container of a product offered to the market. A large portion. Buying Behavior .a term used for products that is individually loaded.is the amount of money you pay for the cost of a product.the availability of the product everywhere. the researchers will conduct a survey targeting the people surrounding the market area. great size or big volume or commonly called Bulk Products.The activity of attracting public attention to a product or business. 2. Having a little income.having a small amount of money. as by paid announcements in the print. 6. Consumer . The target schedule for the survey as well as the interview will be on January 2016. we made a basis for easy understanding.an element that identifies or determine the nature of a competition or conditions an outcome. 3. 9. specifically the buyer who directly use and consume the product or the “consumers”. 10. Meager Income . 8. Advertising . 11.In order to attain the goals of this study. 4. or electronic media.A person who purchases goods and services for personal use.

Trend.is currently popular product in the market. Purchasing Power .to compete with others in an attempt to get or win something CHAPTER II REVIEW OF RELATED LITERATURE AND STUDY RELATED LITERATURE Consumer Behavior Page 8 . Vie. It may be in the form of money and/or credit available for spending and consumption of goods and services. Quality. 14. and creating brand loyalty. 12.the ability to satisfy and fulfil the customer's needs and expectations.sales. Respondents . Significance – the quality of having notable worth or influence 17. 13. Sachet type . 16. 15.a person who gives a response or an answer to a question that is asked especially as a part of a survey. 18.is the extent to which a person has available funds to purchase.the micro form of an existing product offered to the market for a lower price.

This is their mantra for most products used on a daily basis. According in the newspaper Philippine Star for the Filipinos. manifested in their purchase of top FMCG. cheaper local brands are on the rise like laundry detergent. commonly called “tingi.This chapter presents the related literature after the thorough and in-depth search done by the researchers. coffee. and even if 89 percent decide what brand to buy before shopping. the smaller the cash outlay per shopping trip.” continue to be immensely popular among Filipino consumers. and instant noodles are some examples. This will also present the synthesis of the theoretical and conceptual framework to fully understand this research. Patronizing smaller packaged products and sachets has bloated the shopping trips of Filipinos. and 74 percent are willing to try a new product. Indeed. Their lower per capita income compared to their Asian neighbors accounts for the dominance of tingi selling in the country. the better. weekly shopping trips for shampoo have reached 33 Consumer Behavior Page 9 . Moreover. for example. Ninety-two percent plans their shopping in advance and 79 percent prepare a shopping list before hitting the supermarkets or any place they want to do their shopping. the amount of money they have to shell out is still a very important factor. 81 percent end up choosing the brand to put in their baskets at the point of purchase. Sachets and break-bulks. toothpaste. in “Thinking Small” article said that. tea. In addition. To most Filipinos. They look for cheaper options and prioritize buying the basics: 73 percent allot time to look for the best promotions. In a year. “Big Is Out And Small Is In”. The proponent indicates to this study why the Filipino Consumer patronizes break bulk or sachet type of products.

more Filipinos are paying so much more. allowing easy-on-the-pocket buying. They spend wisely. It is more realistic for them to buy only what they need for the moment. and keep the most important and trusted brand. They usually buy from a mom-and-pop outlet or the neighbourhood sari-sari store. which comprise the biggest demographic chunk of Filipino households at 90 percent versus the upper.times compared to every six weeks in other Asian countries. but take note that class E spending remains only a fraction of class A-B spending. look for more affordable alternatives. Consumer Behavior Page 10 . According to the article of Casa Veneracion entitled “Filipino shopping Habits and Tingi Culture”. the major beneficiary of the sachet phenomenon. In effect. The proper word for this practice is Immediacy. while the rest of the Philippines continue to rely on sari-sari stores. The irony is that the “tingi” packaging raises the price of the goods by as much as a hundred percent. There is indeed increased spending seen among low-income homes.” They stretch usage.and middle-income households at 10 percent. Shoppers in the NCR predominantly go to supermarkets. is that the average income is low and majority of the people have to budget carefully. Sachets strongly appeal to the “bottom of the pyramid” market — the class D and E households. give priority to necessities and scrimp on the “nice to haves. but it does not work with many people. while the lower-priced small package may be more affordable for the masses. It is visited almost every day. the answer in what is behind the practice of buying break bulk products. While it may be cheaper in the long run to buy in bulk.

but most people only live on what they can afford each day. Teodosio said that the Filipinos are buying in “tingi” because of the following: (1) lack of availability and (2) consumers lived on a day-to-day basis. in a Consumer Behavior Page 11 . In some ways. people get to save money by not wasting away quantities they don’t need.” Apol Danganan said in Vagabond Journey article entitled. She said that the prevailing “tingi” (mini) economy in the country is a manifestation of the current level of poverty experienced by most Filipinos. Indonesia and Vietnam and it boosted sales as well in those areas. this tingi culture definitely is one tactic to survive each day. the 2013 Kantar Media Advertising Expenditure Report showed that top advertisers are mostly engaged producing products in sachets. economic Professor at West Visayas State University. has been long practiced in the Philippines.“It may be financially unwise to buy a sachet of shampoo everyday versus buying a bottle of shampoo for much longer use and cheaper cost in the long run. In the Philippines where everything must come small. tingi-tingi a colloquial term in repacking products into sachets. “The Philippine Culture of Tingi”. wherein exported such idea to India.” Most consumers of “tingi” products. the Philippines is a best practice for the sachet marketing. Kantar Media General Manager Gabriel Buluran quoted that “For Unilever. In the Iloilo Metropolitan Times newspaper by April Dream Teodosio. What beneficial is with this style of buying you can get only what you intend to use or limit your usage because you have only a little. In fact.

and C classes have turned to mini-sizes. In the question which is more economical?. data show that the D and E segments account for more than 61 billion in estimated sales annually while the A and B classes contribute only about 5 billion. soy sauce. buying of break bulk is better because you can spend your money little by little.Philippine Center Invertigative Journalism (PCIJ) report from D and E classes citing the AC Neilsen study. Of those who live by “tingi”. many among those who belong to the A. Teodosio’s answer is. sixty-three (63%) percent of the respondents bought items in “tingi”. chocolate and milk powder. the D and E would buy on needs basis.” Nearly 90 percent of Filipinos. primarily cooking oil. juice. says AC Nielsen. Consumer Behavior Page 12 . “If you are businessman-with enough capital it’s better to go for wholesale because it has a volume discount so that you can gain profit. now buy products in sachets and mini-sizes. a marketing research firm. Sachets and products in smaller packages enjoy wider reach in rural areas than in urban areas. with the D and E segments making up the majority. B. Coffee. mostly small-size packs. 17% said they bought non-food items while 94% said they bought food. soy sauce. salt and sugar. According to the Global Omnibus Survey of Synovate.” For the supermarkets alone. vinegar. most of them from the D and E classes. In a separate by the market research arm global communications specialist Aegis Group PLC. PCIJ said that “Consumers A and B classes prefer wide product assortment. but if you’re a consumer. creamer. and vinegar topped the list of the 30 percent in those segments who said they bought food items in smaller.

and 20 trips in three months to buy coffee.Synovate’s data show that for the A. fabric cleaning. it also offers the Consumer Behavior Page 13 . Cooking oil and soft drink complete the rural consumers’ top 10 list. food seasoning. coffee. B. Baby care items. The frequency of visits presents a lot of opportunity to see and try what is new on market.400 on the category for the quarter. Rural homes are predisposed to spending more on seasonings and sauces. where Filipino consumers do more trips. snacks and seasonings topped list followed by coffee. canned goods. purchasing goods at lesser and more affordable volumes per trip: 26 to 31 trips to buy biscuits. fabric conditioners and noodles. In Philippine Center for Investigative Journalism. 22 to 28 trips to buy seasonings. hair care. noodles and hair care products. and C classes. while each rural home disbursed 900. Lifestyle section. the top categories that Filipinos spend on are milk products. Abad says that downsizing not only allows the D and E classes to buy what they need at the moment. with each urban home spending 1. snacks/biscuits and alcoholic beverages also ranked high in the “spend per buyer” figures. It’s a test of consumer loyalty. In terms of the number of trips to buy goods. Based on the newspaper The Philippine Star. Sachet marketing continues to rule. one of the main reasons for buying single-serves or mini-sizes is that usage is controlled (they also liked the packets’ handy size that make them easy to carry around). Milk products are on top for both homes. snacks. Household care and frozen foods make up the urban homes’ top 10 categories. This data is a continuing testament to the success of sachet marketing or the “tingi” mentally in the country.

apart from being the most basic necessities of a consumer. Filipinos actually end up saving when they buy items in sachets versus goods in plastic or glass bottles. yet while convenience has certainly been one of the come-ons of buying in sachets. It’s the exact opposite of what is happening in the United States. data show that the D and E segments account for more than P61 billion in estimated sales annually while the A and B classes contribute only about P5 billion. shampoo. And it’s not only because they just a few pesos to spare. These products. according to TNS. where the consumer market has grown bulk-obsessed and gone for super-sized products in part because they believe they save money in doing so. all happen to come in sachets or smaller packs. says TNS account executive Omar Carlos. says AC Nielsen. or buying in break bulk (sachet)? The answer is. you cannot always say that all products in break bulk are more cheaper than in bulk or vice versa. box and can. If we compare which is cheaper. soap. detergent.average consumer variety and a chance to get to know the product. Sachets and products in smaller packages enjoy wider reach in rural areas than in urban areas. Overall. The number-one reason for purchasing downsized items is consumers cite price. Even fabric softeners are now fast becoming sachet-driven. buying product in bulk (big packaging) like bottle. “How can you fall in love with a product if you haven’t tried it?” For the supermarkets alone. Or as Macapagal says. It’s Consumer Behavior Page 14 . and toothpaste remain the top (and growing) items in the nonfood category.

For instance. for example. would result in savings of P10 compared to buying the same amount in 80-gram sachets. will total only P31.75 more when he buys a 385-ml bottle of Silver Swan Soy Sauce instead of purchasing several smaller plastic pouches equivalent to the same amount of toyo. you pay less packaging material than when you buy a bottle. for example. companies base their product price in production expenses including the packaging expense.” he says.” Consumer Behavior Page 15 . a consumer would pay just P1. Buying a 500-gram tin of Milo chocolate powder. it’s cheaper to buy food in bigger cans and boxes than in sachets. Consumers pay for the product. Sociologist Arnel de Guzman. And that’s what makes it (sacheting) a success. however. production-wise.” Joyeux says.15.because. The same holds true for some food items. has another theory about the sachet mania in this country. “On the surface it’s an economic necessity. although the savings aren’t as much as in nonfood goods in sachets. which means 10 sachets. sachets are 10 to 20 percent cheaper than other types of packaging because they consume less packaging material. not the packaging. A 10-ml sachet of shampoo costs P3. One possible explanation is the ‘smallness’ mentality was in still on mind of Filipinos.50. The selling price correspondingly goes down. it’s a lifestyle and we cannot get out of the nearsightedness and smallness. less packaging expense result to less cost of price. explain by Christophe Joyeux. And in some cases. the suggested retail price of a 100-ml bottle of shampoo is P48. development manager for Unilever Philippines.“When you buy a sachet. This is everyday culture. the poor cannot buy in bulk. equivalent to 100 ml. In fact. it’s low cash outlay. At Unilever. In short.

The purpose of applying this type of research is to be able to gather relative information by the collection of data that will provide and uncover facts about the study. An instrument is a tool designed to measure knowledge attitude and skills. However. Research Instrument and Procedure In order to collect data that will support the study. This means that descriptive research gathers quantifiable information that can be used for statistical inference on your target audience through data analysis. Consumer Behavior Page 16 .CHAPTER III RESEARCH METHODOLOGY RESEARCH DESIGN This chapter describes the research method used to determine the effectiveness of break bulk on selected products in affecting the buying preference of the Filipino consumers. It specifically used a descriptive research design. The research instruments will serve as a guide in providing the solutions to the problems. The descriptive research is conclusive in nature. This type of research takes the form of closed-ended questions. used properly it can help an organization better define and measure the significance of something about a group of respondents and the population they represent. The research design which will be used in this study is the descriptive type of research. The study utilized a multi-method approach with analysis of both qualitative and quantitative research data. the researchers will need research instruments in order to obtain the specific problems which were derived from the conceptual framework. which limits its ability to provide unique insights. as opposed to exploratory.

San Roque in Tondo. In order to tabulate the results of the survey. In administering the questionnaire. The Administrative Survey Technique will be applied in order to avoid the collection of duplicate information. The researchers will ensure the security and confidentiality gathered from the respondents. analyze and interpret the views of a group of people from a target population specifically in City of Manila like Puregold Paco. It is obtaining data to the people who have different experiences and beliefs that prevent information bias and thus increasing the credibility regarding the information. Survey Questionnaire Several research instruments will be used in gathering information related to the research. It helps to keep the confidentiality of information and to avoid the interviewer bias. and Robinson’s Supermarket. The weighted mean will also be used to get the average. the researcher will give an allotted time to answer. and Robinson’s Supermarket. such method is the applicable one for the analysis of data gathered. The formula for the weighted mean is: (x)= Consumer Behavior X 1+ X 2+ X 3+ X 4+ X 5 …+Xn n Page 17 . The statistical approach which will be applied in the study is frequency method also known as the percentage method. San Roque in Tondo. Ultramega in Divisoria. The researchers will use Survey Questionnaires in order to gather data. This method is used to determine the relative frequency of survey responses and other data. The respondents of the survey questionnaire are the customers of the different supermarkets in City of Manila like Puregold Paco. to maximize the participation rates of respondents. The questionnaire will be consisting of a number of items that can help to answer the problem of the study and meet the objectives. Ultramega in Divisoria.

The researchers will be using a Survey Questionnaire for the respondents. the researchers will also use a descriptive statistical approach and other sources to acquire facts such primary and secondary data that would support the study further. their perception will become the basis in determining the effectiveness of break bulk on selected products in affecting the buying preference of the Filipino consumers. Ultramega in Divisoria. They will be distributing questionnaires to the selected respondents and let them answer on the same day. Consumer Behavior Page 18 . Moreover. B. Research Procedure The researchers will conduct an administered survey questionnaire. Robinson’s Manila Supermarket das its respondents. The answered questionnaires will be collected and tallied to obtain perception of the respondents as they determine the effectiveness of break bulk on selected products in affecting the buying preference of the Filipino consumers.Where: X= weighted mean Xn= frequency n= number of terms A. San Roque in Tondo. Research Instrument The researchers used the customers of grocery stores within the city of Manila like Puregold Paco.

Consumer Behavior Page 19 .