Pre-operational experience of a start-up enterprise : the case of a flavored yogurt with jelly cubes business in Davao City

Date

2011

Degree

Bachelor of Science in Agribusiness Management

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Dinah Pura T. Depositario

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Abstract

The growing trend of healthy living is changing the general preferences of the consumer market. This emerging trend resulted to the creation of a market for yogurt-based products and the growth of the yogurt industry in the Philippines. Jean Obsioma has developed a product concept which she sees to be marketable: Yogurt with Jelly. Based on this product concept, she conducted trial production runs and marketing to her friends. She now wants to take the business to a new level. A write-up about her plans for the business was made by the researcher, who also happens to be her son. She originally planned to sell her products labelled Neogurt to health-conscious students in Ateneo de Davao University through a food cart in the City Triangle Food Court in Davao City. The start-up, as described in the business plan, was assessed to be infeasible. Because of this finding, some areas for improvement of the business plan were identified. The problem areas included the marketing mix and the high costs of raw materials. Pre-operational activities such as materials sourcing and networking, preliminary market researches and reformulation of business strategies were done to fine-tune the business plan assumptions. These revisions were intended to make the proposed business more viable. More effective alternatives determined through the preoperational activities were recommended to be incorporated in the business plan.

With new sources and type of raw materials, it was estimated that the proposed business will be able to decrease about 8% of its production cost. It was also proposed that the brand name be changed to Yogi Jelly Tops—a fancy name preferred by most of the respondents who were informally interviewed through a mini-survey. The non-yogurt eaters (i.e. those who like fancy products) were added to the targeted markets. The products will be marketed to them as yogurt products sold at a more competitive price that is about 30% to 70% lower. The proposed business will now employ the premium decoy pricing wherein an item which can indirectly lead the customer to buy the actual product the business wants them to buy is offered for sale. Further, the customers will also be allowed to choose the jelly percentage of his product (i.e. 3/4 jelly,1/2 jelly, and 1/3 jelly) to make the marketing of the product more customized. In terms of the organizational aspect, the business will be headed by Antonio Obsioma, who will take the role of the general manager. The food technologist, Jean Obsioma, will be in-charge of the production and product development. Lastly, Joram Obsioma, the student-researcher, will be in-charge of marketing. The total investment for the proposed business is P111,257. The total fixed investments is P47,250, while, the working capital per day is P600. This is for a scale of production of 11.1kg of yogurt with jelly. The revised plan shows that the proposed business is viable with a projected annual income of P47,217 and an internal rate of return of 24.05%.

Language

English

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993 2011 M17 O27

Document Type

Thesis

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