TASKA KYRANA SDN. BHD.

: TO CHANGE OR NOT TO CHANGE ITS

OPERATING DAYS

A Case Analysis

In partial fulfilment of course requirement in

BA 203-Marketing Management

Presented to:

Prof. Jessica T. Fadriga, MM, SMRIM

By:

Marc Myer G. De Asis

Ellery Krizia T. Esclada

I. Point of View

Taska Kyrana SDN. BHD. is a private limited company that offers nursery,

kindergarten and other child care programs in Johor. The company is on its 15

years of existence since it started on September 1, 1998. It has two (2)

branches located in various parts of Johor. It employs a total of twenty-two

(22) workforce in both branches, catering a total of one hundred (100)

students. Taska Kyrana operates five (5) days a week from Mondays to

Fridays from 7:00 am to 6:00 pm. The school also receives and cater requests

from parents for additional hours for child care services. Taska Kyrana targets

middle to upper income Malaysian and Singaporean parents. 35% of their

customers were from the private sector and 65% were from the public sector.

The government of Johor declared a change of the state’s weekend from

Saturday and Sunday to Friday and Saturday effective January 1st of 2014

which is compulsory to public entities but optional to private companies. This

shift may have a great impact in the current operations and financial status of

the organization. Moreover, this modification may also entail losing its

customers to its competitor/s and increase in expenditures if the change is not

well-handled by the company. The management is considering viable options

to enhance its operations, remain competitively in the market and co-exist or

edge out its competitor/s. This may include modification or retention of its

current operating days or other areas of operations which may encompass

additional workforce, fees charged, promotions and a change in its payment

system.
II. Statement of the Problem

I, the proponent, after reading the company profile and operations of Taska

Kyrana SDN. BHD., had identified the following problem;

a. Impact of the change of the state government’s rest days from Saturday-

Sunday to Friday-Saturday on Taska Kyrana SDN. BHD.

b. The slow growth of Taska Kyrana.

c. Poor promotional strategy.

d. Impact of the extension of operations to 6 days to its profitability.

e. How to move closer to its major competitor, NURI Kindergarten.

III. Areas of Consideration

After identifying the problems of Taska Kyrana SDN. BHD., I, the proponent

have identified the areas to be considered:

STRENGTHS

1. Quality Service

Taska Kyrana maintains high-quality service despite its current status of

being a small company. They ensure that they provide an advance level of

development to children at an affordable price.

2. Competitive Price

Taska Kyrana offers a competitive price to its customers while

maintaining a high quality and leading-edge educational services.

3. Reputational Status

Taska Kyrana maintains good reputation to its customer and community

despite the fact of just being a small company.

WEAKNESS

1. Weak Promotional Strategies

Taska Kyrana is to enhance their existing promotional campaign or

marketing strategy to a viable one to attract and retain existing customers.

2. Sluggish Growth
 The company is to consider expansion of business, spreading across the

country since the organization has been a notable kindergarten in Johor.

This is one way to remain competitively in the market and co-exist with its

competitor/s. This may also be a viable solution on Taska’s dilemma on

changing the operating days since only the state Johor declared a change

on its rest days.

3. Limited Target Market

The company is to consider widening its target market, not limiting only to

Singaporean and Malaysian parents but to other nationalities as well.

Although this change may require additional workload to its employees or

increase in number of employees and increase of expenditures, higher

number of parents enrolling their children to child care services of the

company may result to higher profitability and stability of operations.

OPPORTUNITIES

1. Population Growth

Continuous population growth means possible increase in demand, which

may result to increase number of customers and higher profit. Taska

Kyrana is to consider the demographic aspect of its environment in order

to properly strategize their operations including its promotional campaign

to increase more customers and improve current operations.

2. Business Expansion
 Taska Kyrana has marked its name in the industry being a notable

kindergarten in Johor. As population continuous to grow and demands for

child care increases, it would be a good opportunity for the company to

consider expansion of operations to meet the demands of the market and to

provide a better child care services.

3. Innovation

Change is imminent and Taska Kyrana should adopt a strategy how to

boost the competence of the company. They could provide new services

and/or additional facilities for the convenience of their valued customer.

Innovation is a plus factor to increase competitiveness and reputational

status in the industry.

THREATS

1. Government Intervention

The government exists to protect its people and country. However, the

government may impose certain regulations, policies or changes which

may /have a significant effect in businesses and the people. This is the

case of Johor’s state government on changing the rest days from Saturday

and Sunday to Friday and Saturday which may have a great impact on the

current operations of Taska Kyrana.

2. Competition and Potential Entrants

Competition exists in businesses. As the market widens, potential entrant

increases. This is the case of Taska Kyrana in dealing and competing with
 its major competitor, NURI Kindergarten. The company should carefully

plan how to remain competitively and co-exists with its competitor/s in the

market while increasing its profits and enhance its operations.

3. Economic Recession

Unstable economic condition may result to higher risk of bankruptcy.

Hence, it is recommended that Taska Kyrana should always check its

current operations and be aware of its external environment. This is to

avoid disruptions in operations, increase in expenditures, low profitability

and downward growth.

 IV. Alternative Course of Action

After identifying and analyzing the problem exists in Taska Kyrana SDN. BHD, I the

proponent formulated the actions to be done;

1. Extend operating days to six (6) days without sacrificing customers on both public

and private sectors due to recent government regulations.

2. Increase manpower resources by hiring three (3) teachers for the company not to

hamper its operations due to extension of operating days.

3. In order to compensate the increase in expenditures, Taska Kyrana to consider

increase in registration fee, overtime fee and monthly commitment on infant and

toddler but not to the extent of sacrificing its competitive price.

4. Enhance the existing promotional strategies that would help the company to

attract more customers and maintaining its position in the market.

5. Consider expansion and innovation of operations for the company to grow and

move closer to its major competitor. Taska Kyrana SDN. BHD to consider

franchising or licensing in expanding its business operations with less risk on part

of them.

6. Widening the target market by opening to another nationality as well.

7. Enhance the customer service and personnel competencies by providing them

more trainings and seminar program.

 8. Formulate long-term strategy for the company to have a direction and to exist

longer.

**See Annex A-Action Plan

V. Conclusion/Recommendation

After a thorough study of Taska Kyrana case, I, the proponent have come up

with the following recommendations that will serve as guidelines for the

company;

1. Taska Kyrana to stick in current operating days but extend its operations

to 6 days a week, Sunday-Friday. In order to compensate for the increases

in expenditures and additional manpower, Taska Kyrana to increase the

monthly commitment fee by 50 ringgit for Infant, 100 ringgit for Toddler,

registration fee by 50 ringgit and overtime fee by 5 ringgit. (See Annex B-

Decision and Pricing System)

2. Taska Kyrana to consider expansion of operations outside Johor state.

Since other State of Malaysia are not affected by the regulations, it would

be beneficial to Taska Kyrana to provide service on both public and

private sector without stressing conflicts on rest days. Taska Kyrana may

consider franchising or licensing of brand name in expanding its

operations for the company to lessen its investment risk.

3. Taska Kyrana to enhance its promotional strategy for the company to

attract more customers and moving closer to its major competitor. Taska

Kyrana should strengthen promotions through social networking sites

since more people are active on social media today, strengthening the tie-
up system by offering more loyalty discounts, freebies and rebates to other

stores/organization and to entice more customers by offering 10% group

discount in the group of five (5) enrollees in their first three monthly

commitment fees and 10% solicitation discounts on valued customers in

their monthly commitment fee upon referral of at least two (2) enrollees.

Solicitation discount can be availed on the month where the two (2)

referrals enrolled.
 Annex A - Action Plan
TIME FRAME ACTION
December 2013-January Develop a new pricing
2014 strategy.
December 2013-January Hire three (3) additional
2014 teachers.
January 2014 Implement operating day
extension from five (5)
days, Monday-Friday to six
(6) days a week, Sunday-
Friday.
January 2014-December Develop long-long term
2014 strategy.
February 2014 Implementation of group
discounts and solicited
discounts on old and new
customers.
March 2014-December Enter into more tie-up
2014 contracts with other stores
to offer more loyalty
discounts, freebies and
rebates.
April 2014 Engage in advertising by
providing 40% of
promotional resources in
social media platform.
June 2014-December 2014 Increase the capitalization
of the company through
additional investment by the
owner and/or
financing/obtaining loan
from a bank.
OBJECTIVES
Compensate increase in
expenditures due to extension
of operating days.
Support on extension of
operating days in order not to
hamper the operations due to
weak workforce.
Accommodate customers on
both public and private sector,
without stressing the change in
operation days due to recent
regulations by the State
Government of Johor
To strengthen the longevity of
the company.
Increase the number of
customers.
Increase the number of loyal
customers
Increase public awareness.
Strengthening the health of the
company and to support plans
on expanding its operations.
January 2015-December Enter into franchising or Expand operations across
2018 licensing of brand outside Malaysian border.
the Johor State.
Annex B - Decision and Pricing System
 Decision A Decision B Decision C
PRIOR GOVERNMENT TO CHANGE NOT TO CHANGE EXTEND EXTEND OPERA
INC/DEC IN % INC/DEC IN % INC/DEC IN %
REGULATIONS OPERATING DAYS OPERATING DAYS OPERATING DAYS INCREASE IN P
*Losing 35% of *Losing 65% of *from Mon-Fri to Sun- *Infant-500.00 rupia
customers Custom ers Fri *Toddler-500.00 rupi
*Registration Fee-200
*Overtime Fee-15.00
Income from operations
Registration 14,850.00 9,652.50 (35.00%) 5,197.50 (65.00%) 14,850.00 0.00%
Commitment -
Infant 113,400.00 73,710.00 (35.00%) 39,690.00 (65.00%) 113,400.00 0.00%
Toddler 144,000.00 93,600.00 (35.00%) 50,400.00 (65.00%) 144,000.00 0.00%
Preschool:
Full Day 217,800.00 141,570.00 (35.00%) 76,230.00 (65.00%) 217,800.00 0.00%
Half Day 81,000.00 52,650.00 (35.00%) 28,350.00 (65.00%) 81,000.00 0.00%
Overtime 24,000.00 15,600.00 (35.00%) 8,400.00 (65.00%) 24,000.00 0.00%
Drop-off Service 60,000.00 39,000.00 (35.00%) 21,000.00 (65.00%) 60,000.00 0.00%
TOTAL INCOME 655,050.00 425,782.50 (35.00%) 229,267.50 (65.00%) 655,050.00 0.00%

Expenses
Salaries:
Teacher 259,200.00 168,480.00 (35.00%) 90,720.00 (65.00%) 302,400.00 16.67%
Staff 43,200.00 28,080.00 (35.00%) 15,120.00 (65.00%) 54,000.00 25.00%
Overtime Pay 24,000.00 15,600.00 (35.00%) 8,400.00 (65.00%) 24,000.00 0.00%
Rental 24,000.00 24,000.00 0.00% 24,000.00 0.00% 28,800.00 20.00%
Utility Bills 12,000.00 12,000.00 0.00% 12,000.00 0.00% 14,400.00 20.00%
Meals
Infant 25,200.00 16,380.00 (35.00%) 8,820.00 (65.00%) 30,240.00 20.00%
Toddler 36,000.00 23,400.00 (35.00%) 12,600.00 (65.00%) 43,200.00 20.00%
Preschool
Full Day 18,000.00 11,700.00 (35.00%) 6,300.00 (65.00%) 21,600.00 20.00%
Half Day 39,600.00 25,740.00 (35.00%) 13,860.00 (65.00%) 47,520.00 20.00%

TOTAL EXPENSES 481,200.00 325,380.00 (32.38%) 191,820.00 (60.14%) 566,160.00 17.66%

NET INCOME 173,850.00 100,402.50 (42.25% ) 37,447.50 (78.46% ) 88,890.00 (48.87% )