V.

The Market and the Macro Environmental Forces Affecting the Opportunities and
Threats in the Market

SUPPLY AND DEMAND

Supply and demand is one of the most basic and fundamental concepts of
economics and of a market economy. The relationship between supply and demand results in
many decisions such as the price of an item and how many will be produced in order to
allocate resources in the most cost-effective and efficient way.
(Reference: http://examples.yourdictionary.com/supply-and-demand-examples.html)

SUPPLY SITUATION OF CEREAL

The following data presents the actual supply and average increase in cereal data
came from the conducted survey of different Sari-sari Stores for the year 2018.

TABLE I

Supply Analysis of Cereal

Mabalacat City
Daily Monthly Annual
Devy’s Sari-sari 50 1,500 18,00
Store
Ely’s Sari-sari Store 45 1,350 16,200
Agnes’s Sari-sari 42 1,260 15,120
Store
Mura-mura Sari-sari 66 1,980 23,760
Store
Erica Lei Candy 75 2,250 27,00
Store
Subtotal (Annual) 100,080

Angeles
Daily Monthly Annual
Ana’s Sari-sari Store 80 2,400 28,800
Grace Sari-sari Store 45 1,350 16,200
Lourdes’ Sari-sari 50 1,500 18,000
Store
Mher Sari-sari Store 65 1,950 23,400
Leny’s Sari-sari 70 2,100 25,200
Store
Subtotal (Annual) 111,600
Total Annual Supply 211,680
 Computation of Average Annual Increase in Cereal
Mabalacat City
Stores Percentage
Devy’s Sari-sari Store 8%
Ely’s Sari-sari Store 3%
Agnes’s Sari-sari Store 7%
Mura-mura Sari-sari Store 10%
Erica Lei Candy Store 11%
Angeles City
Stores Percentage
Ana’s Sari-sari Store 10%
Grace Sari-sari Store 12%
Lourdes’ Sari-sari Store 7%
Mher Sari-sari Store 9%
Leny’s Sari-sari Store 8%
Total Percentage divided by 85%
Total Number of Stores 10
Average Annual Increase 8.5%

TABLE II

Historical Supply of Cereal

Year Historical Supply
2013 148,376
2014 162,160
2015 177,224
2016 193,687
2017 211,680

TABLE III

Projected Supply of Cereal

Year Supply of the Average Increase Projected Supply
Previous Year
2018 211,680 12,661 224,341
2019 224,341 12,661 237,002
2020 237,002 12,661 249,663
2021 249,663 12,661 262,324
2022 262,324 12,661 274,985
 TABLE IV

Average Per Capita Consumption

Usage Frequency No. of population Total estimated no. of cereal
consuming cereal consumed every year
Daily (360) 5,760
Weekly (52) 728
Twice a Month (24) 576
Monthly (12) 336
Total 7,400
Percentage Consumption
Divided by total population
consuming cereal
Average Consumption per 90
Capita
Table IV shows the number of population consuming cereal in different flavors and the total
estimated number of cereal consumed every year was 90.

DEMAND SITUATION OF CEREAL

The following data presents the percentage of population capable of consuming cereal
based on the average growth rate of 4.52 (Angeles City) and 2.92 (Mabalacat City).

TABLE V

Historical Demand of Cereal

Year Place Place Total % of population Per capita Total
(Mabalacat) (Angeles capable of consumption Historical
City) buying cereal Demand
201 236,367 375,263 611,63 32% 90 17,614,944
3 0
201 243,476 393,028 636,50 32% 90 18,311,315
4 4
201 250,799 411,634 662,43 32% 90 19,078,070
5 3
201 258,122 430,240 688,36 32% 90 19,824,826
6 2
201 265,659 449,687 715,34 32% 90 20,601,965
7 6

TABLE VI
 Projected Demand of Cereal
Year Demand of the Average Increase Projected Demand
Previous Year
2018 20,601,965 597,404 21,199,369
2019 21,199,369 597,404 21,796,773
2020 21,796,773 597,404 22,394,177
2021 22,394,177 597,404 22,991,581
2022 22,991,581 597,404 23,588,985

SUPPLY AND DEMAND ANALYSIS

(Discussion)

The table below shows the gap rate based on the analysis made

TABLE VII

Supply and Demand Analysis

Year Projected Projected Gap Gap Rate

Demand (a) Supply (b) (a-b) (a-b)/a
2018 21,199,369 224,341 20,975,028 99%
2019 21,796,773 237,002 21,559,771 99%
2020 22,394,177 249,663 22,144,514 99%
2021 22,991,581 262,324 22,729,257 99%
2022 23,588,985 274,985 23,314,000 99%