DIPLOMA PENGAJIAN PERNIAGAAN

(DBS2A)

FUNDAMENTAL OF MANAGEMENT
(MGT162)

GROUPING ASSIGNMENT

STUDENT’S NAME MATRIKS NUMBER

AIMAN NURHAZIQ BIN IZHEIR AZAM 2020633492
DEWI BALQIS BINTI JAMALLUDIN 2020654176
MUHAMMAD SHAHID DANIEL 2020286008
NOOR REZZA ATIQ BIN MD YUSOF 2020203472
ZAMIRUL AFZAN HAFIDZ BIN ZAMRI AZMIRA 2020823542

PREPARED FOR: MISS MAIZATUL HAMIZAH BT ABDUL HALIM

SUBMISSION DATE: 29 JUNE 2021

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 ACKNOWLEDGEMENT

First and foremost, we want to express our gratitude to Allah SWT and his
messenger, Prophet Muhammad S.A.W. It is only because of His blessing that we were able
to complete this task. I had successfully completed this group assignment with much zeal
and dedication. All of the time we spent searching for and discussing solutions, as well as
justifying theoretical hints to push the production, was well spent, Insya-Allah.

We would also like to express our gratitude to our Fundamental of Marketing lecturer,
Miss Maizatul Hamizah Bt Abdul Halim, for providing us with encouragement from the
beginning to the end of this project, as well as to anyone who has directly or indirectly
assisted us in carrying out this project. Not to mention our friends, especially our classmates
and groupmates, for their complete cooperation in this venture of our project and for
contributing to it. Finally, after working on this difficult project for the whole semester, we
completed it with what I consider to be the ideal of near enough to perfection.

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NO. CONTENTS PAGE NUMBER

1 1.0 INTRODUCTION 1

2.0 PRODUCT DECISION

 Branding
2  Trademark 2-3
 Packaging
 Labelling

3 3.0 DEVELOPING AND MANAGING PRODUCT 4

4 4.0 MARKETING CHANNEL 5-6

5.0 RETAILING
5  Store Retailing 7-8
 Non-store Retailing

6.0 PROMOTIONAL MIX

6  Advertising 9
 Sales Promotion

7.0 PRICING CONCEPTS

7  Pricing Objectives & Strategy 10-11
 Discount Pricing Tactic

8 REFERENCES 12

9 APPENDIXES 13

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1.0 INTRODUCTION

Lab café Business was started in 2019. Our company started when we pooled our ideas to
start this business. We discussed costs and thoughts to see if it was feasible for this
company. We put a lot of effort into starting this business, which includes locating it in a
strategic area. The cafe was located in the city centre on a busy street corner. Clients will be
able to spot the cafe quickly because of its excellent location.

After a year, our company had grown into a steady situation. Our company's
earnings have increased from 30% to 60% because of this broadening. We updated our
services around the same time. Lab café serves hot and cold beverages, including whole-
bean coffee, espresso latte, teas, Modern Juice Evolution, Frappuccino drinks, boba drinks,
pastries, and snacks such as chips and crackers. Pre-packaged items such as meals,
pastries, hot and cold sandwiches, mugs and tumblers, and beverages are also available at
the lab cafe.

We combine our ideas and even our methods to create new renewals. Our
companies are now well-known not just in Shah Alam, but also throughout Malaysia,
including Sabah and Sarawak. This is due to the fact that our company is unlike any other.
We provide good service in terms of consistency and pricing. To avoid dissatisfaction with
our service, we prioritise our customers and fulfil their requests. Our commercial success
has exceeded our expectations.

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2.0 PRODUCT

“A product is something in a firm market that will satisfy a personal wish or fill a
corporate or commercial requirement, and it includes all the peripheral factors that may
contribute to customer satisfaction,” according to Schwartz. According to Kotler, a product is
anything that may be given to a market in exchange for attention, purchases, usage, or
consumption in order to satisfy a desire or need. The product is also the "heart" of the
Marketing Mix. A consumer product is purchased to fulfil a person's or family's needs. A
single thing can be classified as either a commercial or a consumer product depending on its
intended use.

1. Branding
Branding1 is the primary tool used by marketers to differentiate one product from
another. The most crucial goal of branding is to identify a product. We chose the name "Lab
Cafe" for our brand because we want our clients to be able to tell the difference between our
product and other well-known brands. We currently offer a variety of hot and cold beverages,
whole-bean coffee, espresso latte, teas, Modern Juice Evolution, Frappuccino drinks, boba
drinks, pastries, and snacks under our own brand. Pre-packaged items such as meals,
pastries, hot and cold sandwiches, mugs and tumblers, and beverages are also available at
the lab cafe.

2. Trademark
A trademark is the exclusive right to use a brand name and using it without
permission from the company is illegal. We have our own tagline at Lab Cafe: "Our lab cafe
is the only lab where you can eat and drink." We are not permitted to eat or drink in a
laboratory, but our lab cafe is unique in that we experiment and artisanally embellish each
cup, glass, and mug for guests to enjoy their drinks and nibbles. Our slogan's goal is to
make customers remember our goods when they hear it. Customers are more inclined to
buy this product if they can recollect our brand name by recalling our trademark.

1
Onkvisit, S., & Shaw, J. J. (1989). The International Dimension of Branding: Strategic
Considerations and Decisions. International Marketing Review, 6(3).
https://doi.org/10.1108/EUM0000000001512

2
 3. Packaging
According to the Cambridge Dictionary, packaging refers to the materials used to
wrap goods before they are sold. Packages serve a variety of purposes, including protecting
things, promoting them, making them easier to use and recycle, and so on. Our packaging
serves two purposes: it keeps our drinks safe, and it looks good. It also helps us promote our
drinks. We provide a variety of packages2 to suit the needs of heavy, moderate, and light
users.

4. Labelling
The importance of labelling on a product's packaging cannot be overstated.
Persuasive labelling, informational labelling, and nutritional labelling are the three types of
labelling available, however the one we use on our package is persuasive labelling. The type
of labelling that we employ is a corporate brand label, a return address label, and a pleasant
special message label that will allow adequate space to convey across the necessary
information, our brand, our professionalism, and our heart for our valued customer. The
distinctive message on the label, in particular, will serve to draw attention to the product and
may have an impact on future purchasing decisions. Personalizing our messaging, on the
other hand, helps our customers feel even more special.

2
Rundh, B. (2009). Packaging design: creating competitive advantage with product packaging. British
Food Journal, 111(9), 988–1002. doi:10.1108/00070700910992880 

3
3.0 DEVELOPING & MANAGING PRODUCT

Expansion is a crucial component of every successful growth strategy. While

expanding into new sales channels and scaling our operations is critical, we also need to
increase our product offerings in order to achieve long-term success. However, there are a
variety of reasons that can impact our decision to increase our product options. When it
comes to designing new products, timing, client demand, the competitive landscape, and
production costs are just a few of the factors to consider. Product development 34, on the
other hand, can be a highly effective strategy to increase our firm if the correct processes
are in place.

We look at our customers' feedback to determine what they enjoy about our products
and what they want to see more of in the future. We evaluate whether there are potential
market opportunities for our new product after we have a clear demand-driven strategy. We
achieve this by keeping an eye on industry developments and evaluating the competitive
landscape for similar items that are already on the market.

Specifically, a Global Product R&D centre dedicated solely to the development of

novel drink flavours, both foreign and domestic. We're always developing and seeking for
new and better ways to innovate and improve. Before making a selection purely on the basis
of pricing, we make sure we properly evaluate your possibilities. Lab Cafe has put a lot of
money and resources into establishing the centre, which now functions as a retail technology
research development centre to keep commercial operations running smoothly. In reality, the
centre will continue to receive further expansion and funding in the future. This is with the
hopes of "exceeding client expectations by pleasing them."

We analyse everything from the cost of promoting the product to staff compensation
to ensure that we can get an accurate picture of our return on investment. When we develop
a new product, we don't underestimate the time and work required to ensure that it reaches
our target market. To get the word out about our cafe and products, we pay ads, banners,
and even offer free products to influencers.

3
Regan, P. E., & Kleiner, B. H. (1997). New developments in improving quality management in
research and development. Aircraft Engineering and Aerospace Technology, 69(1), 26–30.
https://doi.org/10.1108/00022669710161621
4
VONCORSWANT, F. (2004). ORGANIZING INTERACTIVE PRODUCT DEVELOPMENT. Advances
in Business Marketing and Purchasing, 13, 1–209.
https://doi.org/10.1016/S1069-0964(04)13001-9

4
4.0 MARKETING CHANNEL

Lab Cafe uses both direct & indirect channels for their marketing channel where we
already have established our cafe across Malaysia including Sabah & Sarawak. For our
direct channel, People can come and visit our branches and find any drinks of their choosing
including our new bubble tea that we created named “Latte Glucose”. Expansion of franchise
stores, investments, fundings, and new product launches are the key strategies of the
bubble tea market players. Because of the popularity and ground-breaking response from
the customers, the businesses in this market typically franchise into different locations. Lab
Cafe, for instance, was founded in 2019 in Malaysia. Now, the brand operates in every state
in Malaysia with more than 500 franchised stores, thanks to its pursuit of rapid expansion
strategy. As the demand for bubble tea drinks continues to rise from consumers, we Lab
Cafe are beginning to pay more attention to improving the functionality of bubble tea
ingredients. That’s why every week we like to come up with new ideas for our bubble tea
menu, so that customers can get a variety of drinks.

Food and drinks are now created to be chronicled in a way that they were not in
previous decades. While flavour is still at the forefront of innovation, aesthetic appeal such
as colour and texture are becoming increasingly vital in order to infiltrate consumers'
thoughts and make a dent in the often-bewildering number of options. Some elements are
viewed as more abundant than typical in share-focused civilizations because they engage
more of the senses. The hues of matcha, turmeric, and activated charcoal, for example,
draw attention. These ingredients have the potential to become image-centric media when
employed in snacks, drinks, and other sorts of food for social media.

As a result, one of the indirect routes used by Lab Cafe is social media. For business
owners, social media5 is critical in contacting customers from various demographics and
determining how to expand. By shooting multiple images and posting them on social media
sites such as Instagram, Twitter, and Pinterest, we can entice people to buy our bubble tea.
At the same time, it is important to remember that social media may be a dangerous ground
to rely on when building a business. Online news (whether genuine or false), reviews, and
criticisms can spread quickly and out of control. As a result, it's critical to ensure that each
post is thoughtfully prepared and that the messaging is always relevant to the business. Do
you recall the "dirty bun," churros, salted egg, and frozen yoghurt from your childhood?
Because attention span on social media feeds is a valuable commodity, many of these viral
5
Jones, N., Borgman, R., & Ulusoy, E. (2015). Impact of social media on small businesses. Journal of
Small Business and Enterprise Development, 22(4), 611–632.
https://doi.org/10.1108/JSBED-09-2013-0133

5
culinary trends faded within a short amount of time. As a result, ongoing innovation is
required to keep a food fad desirable and social media respectable. Standing apart in a sea
of milk tea companies is a difficulty that bubble tea brands must face – which is why we
should never dismiss any idea that seems too strange to explore; you never know what
might work.

People aren't permitted to go out and purchase for products they want during the
Movement Control Order (MCO) time, so our CEO decided to design a DIY kit for our loyal
and new customers who wanted to make our bubble tea on their own. We used social media
and created an official website to promote our DIY kit, and within a few days of launching,
we had sold hundreds of them. The enthusiastic response from our regular clients took our
CEO by surprise.

In addition to using social media, our cafe offers a delivery or pick-up service through
food delivery services like FoodPanda or GrabFood. This would enable customers who are
unable to leave their homes to order our beverages and snacks through this food-service
platform, particularly during the MCO period. This food-service platform will locate any of our
local cafes in your area and provide you with a reasonable pricing. Ordering online has
become so common and convenient for consumers as a result of hectic schedules and high
traffic that we only expect the trend to expand in size and frequency. Consumers prefer to
purchase food via online services by installing applications and selecting their favourite
foods, thanks to the widespread use of smartphones. Food delivery has surely been affected
by the rise of third-party delivery businesses such as FoodPanda and GrabFood.

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5.0 RETAILING

Store Retailing
Retailing is defined as actions that are directly related to the sale of goods and
services to end consumers for personal and non-commercial purposes. Our store can be
found in Shah Alam. We chose Shah Alam as our headquarters because it is a vital location
for conducting business. We chose Shah Alam as our headquarters because of its proximity
to our competition. We don't want to be right next door or across the street from a
competitor's business. We can find a business site that permits us to develop our own base
by knowing where our competitors are. It can also help us compare demand for our product
or service to that of other businesses. We also evaluate our company's location in order to
make it easier for our suppliers to reach our premises on time to deliver items and give the
essential service to keep our business running properly. And the closer we are to our
suppliers, the faster we can get our product to market.

When choosing a site for a business, we take into account our company's potential
for growth. Although a tiny space may be less expensive, its size may hamper our
operations in the future. As our company grows, we may require extra space. For example,
we may require extra manufacturing space in order to produce more products. Alternatively,
we may require a larger store space to accommodate additional clients. We also pay a visit
to the area multiple times during the day to observe the flow of clients as they enter. We
want a location with a lot of foot traffic so that our consumers may come to our store or
headquarters and have a pleasant time. We also consider our surroundings are safe, so our
customers and staff don't have to be afraid to get out of their cars and stroll into our store or
headquarters. We also make decisions based on customer feedback. For example, we'll
pretend to be customers to see if the location is pleasant to dine in or if getting to the
headquarters is difficult. We'll think like customers to determine whether it's OK to open a
café there.

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Non-store Retailing
Non-store selling has outgrown traditional physical shop retailing in more ways than
one. Customers have been encouraged to shop without visiting a physical retail store as a
result of this. We are pleased to announce that we now have our own website to assist
buyers in purchasing our products online. Aside from that, our store was able to develop an
official website that focused on selling our DIY kit, as well as a social media account on
Instagram with the handle @labcafe.hq, which we used to engage with our customers. We
use social media because it allows customers to immediately purchase things that their
friends and mutual acquaintances have recommended. Our customers will save a lot of time
and money thanks to the invention of the DIY kit, which they can purchase on our website.
All they require is a smartphone and access to the internet.

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6.0 PROMOTIONAL MIX

To market our cafe's offerings to clients, we used a variety of tactics. In order to

affect an opinion or elicit a response, promotion is necessary to inform, convince, and
remind people. Advertising, large public relations tools, and sales promotions are just a few
of the techniques. We will be able to promote in public and attract more people to our café in
this manner.

Advertising
People may become enthralled by a brilliantly designed promotional graphic that
entices them to purchase. We make every effort to cater to our customers' preferences and
selling conditions. We use a variety of "prime media" platforms to promote our Lab Cafe,
including television commercials and the internet. However, we are still concentrating on our
budget in order to plan how much money we will spend on the advertising approach and
ensure that we spend it effectively. Not to mention, our goal is to keep people looking at our
Lab Cafe because we run promotions every month to entice people to come in. Customer
trust is built through repetition of our Lab Cafe commercial and product positioning.
Customers' culinary reviews are regularly updated on social media channels such as
Instagram, Twitter, and our official Lab Cafe websites by our staff. As a result, it is the most
efficient method of attracting attention to our services.

Sales Promotion
Customers at Lab Cafe are always given coupons that cut the price of our drinks and
snacks. Coupons are a great method to encourage people to try new products and buy them
again. This may entice folks to return to our cafe on a regular basis. People nowadays
usually choose to use coupons to purchase something in order to save money. For example,
our specialty drink, the boba drink, is normally RM15, but with coupons, it is only RM10. As a
result, consumers will be more inclined to buy more of our meals at Lab Cafe.

Lab Cafe use sampling tactics to market their food and beverages. Customers can
experience samples of our drinks or meals in a tiny cup or on plates. This will demonstrate
that our food and drinks are far more delectable, and it will encourage others to try out our
product at a Lab Cafe. As a result, people have more faith in the quality of our food and
beverages.

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10
7.0 PRICING

A product's or service's price is the amount of money charged for it. The price paid is
determined by the customer's perceived satisfaction6 with the service or product they
expected. Price isn't always associated with money; it can refer to anything that has a
monetary value. Setting the proper pricing for a product is critical for a business because
price is the primary source of revenue. According to Lamb, price is the amount of money that
should be given up in return for a good or a service. As a small business owner, we must
always seek innovative strategies to attract new consumers, retain existing ones, and
compete with other companies. Pricing methods, which assist us determine how to price our
items or services, are one way we can do these things. Try a discount pricing strategy to
boost cash flow.

Pricing Objective & Strategy

Price oriented, sale oriented, and status quo pricing are the three pricing objectives.
Our pricing target in our firm was status quo pricing, which means that Lab Cafe's prices are
identical to those charged by competitors such as Tealive and Chatime. Our pricing plan will
be highly competitive to meet the spending patterns in the market, as Lab Cafe is intended
to cater to people of all ages. In general, we look at the food cost rather than the currency to
maintain a strong franchise model. After the franchise fee, we'd like to maintain a profit
margin of 18% to 20%. Our managers shop at competitors' stores on a regular basis to
guarantee that our prices are similar.

6
Rowley, J. (1998). Promotion and marketing communications in the information marketplace. Library
Review, 47(8), 383–387. https://doi.org/10.1108/00242539810239543

11
Discount Pricing Tactic

Discount pricing is a form of pricing strategy in which we lower the prices of our
products. A discount pricing strategy's purpose is to increase customer visitation, clear out
old inventory, and improve revenues. Most companies use a variety of pricing techniques to
avoid relying on discount pricing for extended periods of time. When adopting a discount
pricing strategy, we are always cautious. We may end up losing money if we continue to
mark down costs. Furthermore, if everything is always marked down, shoppers may not feel
a feeling of value or urgency. We can't exclusively rely on low prices. Large corporations
frequently have lower rates because they can obtain bulk discounts, making it difficult for
small enterprises such as ours to compete. For maximum impact, we emphasise the
uniqueness of our products or services and, on occasion, give discounts.

Discounts assist not only our company, but also our customers. We've noticed an
increase in the number of consumers visiting our store, as well as an increase in sales and a
larger profit margin. Offer discounts if we aren't on track to accomplish our sales goals. This
could provide a boost and ensure that we have sufficient incoming funds to pay our
expenses. Discounts can also be used to get rid of inventory surpluses. We can make room
for new goods by reducing the amount of inventory we have. Having an excessive amount of
inventory can result in expensive storage expenses or shrinking. Customers who obtain
discounts, on the other hand, may be more devoted to our store. Discounts give customers
the impression that they are getting a better deal. Customers may also feel more valued if
they receive loyalty discounts.

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8.0 REFERENCES

Fundamentals of marketing textbook, Norazila Binti Abdul Aziz

Jones, N., Borgman, R., & Ulusoy, E. (2015). Impact of social media on small businesses.

Journal of Small Business and Enterprise Development, 22(4), 611–632.

https://doi.org/10.1108/JSBED-09-2013-0133

Onkvisit, S., & Shaw, J. J. (1989). The International Dimension of Branding: Strategic

Considerations and Decisions. International Marketing Review, 6(3).

https://doi.org/10.1108/EUM0000000001512

Regan, P. E., & Kleiner, B. H. (1997). New developments in improving quality management

in research and development. Aircraft Engineering and Aerospace Technology,

69(1), 26–30. https://doi.org/10.1108/00022669710161621

Rowley, J. (1998). Promotion and marketing communications in the information marketplace.

Library Review, 47(8), 383–387. https://doi.org/10.1108/00242539810239543

Rundh, B. (2009). Packaging design: creating competitive advantage with product

packaging. British Food Journal, 111(9), 988–1002.

doi:10.1108/00070700910992880 

VONCORSWANT, F. (2004). ORGANIZING INTERACTIVE PRODUCT DEVELOPMENT.

Advances in Business Marketing and Purchasing, 13, 1–209.

https://doi.org/10.1016/S1069-0964(04)13001-9

13
9.0 APPENDIXES

14