INDUSTRY ANALYSIS

2.1. Profile
The Philippines population has been growing by approximately 2
percent annually, currently reaching nearly 100 million. This has had a
compounding effect on the demand for food and beverage products. Like
every other country, the food industry has flourished very well in Philippines.
Many people love to eat and thats the reason why you will see a lot of
restaurants and fast foods restaurants scattered in the cities.
Banana is the leading fruit grown in the Philippines and a consistent
top dollar earner. The prospect of Philippine bananas in the domestic and
foreign market is still promising. The Department of Agriculture (DA) believes
the banana industry remains a leading export income-earner for farmers.
Cardaba is processed into banana chips intended mainly for the export
market. Cavendish is also processed for feeds, flour, vinegar and banana
catsup. Local markets for Cardaba is still driven by the mega urban centers
such as Metro Manila and Metro Cebu mainly for snack foods such as banana
cue and turon. Lakatan and Latundan are also mainly for the local markets in
Visayas and Luzon
There are many factors influencing and shaping the countrys demand
for food and beverage products. People are frequentlysnacking. The youth
oriented food market like trendy products, attractive packaging and
sweetened foods and beverages. Approximately 35 percent of the population
is under 15 years old.
High workforce participation by women, increasing the demand for
convenience food and foodservice sales. The number of dual income
households has been increasing, which has driven greater demand for food
that is easier to prepare and offers shortcuts to meal preparations. Women
traditionally do the cooking in households, but because they are preoccupied

with work outside their homes, many of them buy cooked food, have them
delivered or just dine out. Because of todays fast-paced lifestyle, ready-tocook and ready-to-eat meals have become greatly in demand. The food
service industry is sought after by a growing number of people who want to
have filling meals in the shortest time and at the most reasonable price.
Consumers are becoming more health conscious and grocery retailers
are starting to increase the range of their organic products. There are
opportunities for healthier packaged food products such as vegetarian,
seafood-based, all natural and organic products.
Growing food safety concerns and awareness of health benefits.More
consumers have higher consumer standards. Improved distribution channels
resulted in higher household penetration. Going into the food service
business needs a lot of study on important principles of managing it. Food
can affect the health of the consumers; therefore it is the responsibility of its
owners to maintain the cleanliness of the foods served and the place. This
includes quantity cooking, menu planning, food pricing, and sanitation of
work area and process, as well as health care of customers. Another
important principle in this business is honest service to customers.
Therefore, getting into the food business is assuming a great responsibility to
the public.

2.1.1. Classification
According to the Philippine Standard Industrial Classification (PSIC),
Bananarific is in the division of FOOD AND BEVERAGE SERVICE ACTIVITIES.
This division includes food and beverage serving activities providing
complete meals or drinks fit for immediate consumption, whether in
traditional restaurants, self-service or take-away restaurants, whether as
permanent or temporary stands with or without seating. Decisive is the fact

that meals fit for immediate consumption are offered, not the kind of facility
providing them.
Under this division it is classified in Group 561, Class Code 5629Restaurant and Mobile Service Activities.
This class includes the activity of providing food services to customers,
whether they are served while seated or serve themselves from a display of
items, whether they eat the prepared meals on the premises, take them out
or have them delivered. This includes the preparation and serving of meals
for immediate consumption from motorized vehicles or non-motorized carts.
This

class

includes

activities

of

Restaurants;

Cafeterias;

Fast-

food restaurants; Pizza delivery; Take-out eating places; Ice cream truck
vendors; Mobile food carts; Foodpreparation in market stalls. This class also
includes restaurant and bar activities connected to transportation, when
carried out by separate units.
2.1.2. Size
As of 2009 count base on Department of Trade and Industry, there are
780,437 business enterprises operating in the Philippines. There are 97,298
hotels, restaurants, and other food business establishments in the country.
Majority of the businesses can be found in the National Capital Region (NCR),
with 210,648 business establishments; Region 7 (Central Visayas) with
45,427; and Region 6 (Western Visayas) with 45,382.
About hundreds of these businesses are selling beverages such as fruit
shakes, smoothies, teas, coffees, juices, and more. As well as snackbars such
as cupcakes, on-sticks, burgers, fries, and etc.
As of the moment there are only few businesses in the Philippines that
sell in an all-banana products but nothing is like Bananarific which offers both
healthy smoothies and goodies. Theres Frozen Bananas that offers coated

with strawberry, chocolate, and sweetcorn frozen bananas and you can add
toppings such as marshmallows, sprinklers, and rice crisps.And theres Saba
Republic that offers saba fruit delicacies such as maruya and saba con yelo
with less sugar used.

2.1.3. Competition

The food industry has relatively large number of competitors with

differentiated products often promoted by heavy advertising although the
entry and exit from the industry is quite easy. In economics, this kind of
competition is known as monopolistic competition because in contrast with
pure competition which has standardized products, monopolistic competition
is distinguised by product differentiation.
The food industry has product attributes concerning about service,
location, brand names, packaging, pricing, and advertising. Quality service is
given to any valued customers. Products are differentiated through the
location and accessibility of the stores that sell them. Brand names and
trademarks, packaging, and celebrity connections are used in the different
enterprises under this industry. Despite the large number of firms,
enterprises has control over their product prices. Monopolistic competitors
over price is limited since there are numerous potential substitute for its
product. Food enterprises advertise their products often heavily to increase
consumers awareness and purchases.Many consumers are willing to pay
more for ecologically responsible products, they are after the taste and
convenience of food products and packaging.
Competitors under the Food and Beverage Service Activities are
Thirsty, Fruitas, Zagu, Black Pearl, Fruit Magic and etc. What makes the
customer love them is there healthy offers (except for Black Pearl which sells
non-fruit shakes) in the market and you can actually see how they prepare
their products. Theres also those newly established tea shops in the city

such as Moon Leaf, Cha Time, Tearrific, Serendipitea, Tea Religion, Gong Cha,
Bubble Tea House, and etc. that are possible competitors in the food industry
since its new and offers more of an Asian taste option to the customers. Big
enterprises are keeping up with the battle in the food industry competition
such as 7-Eleven, KFC, Bos Coffee, Starbucks, and etc. They have a widerange of menu but still offers products that are similar to other food and
beverage enterprises. Being big does not guarantee victory. Market
relevance and acceptance guarantee victory.

2.1.4 Key Success Factors

Filipino consumers generally eat five times a day and food is a basic
need of all human beings and through this, Bananarific Company would
want to make it a goal to respond to the needs of the general
community. Since demand of the product is based on a need, therefore
it would be very favourable to the company.

The Western and Asian influence on the food and beverage market and
this includes American, Mexican, Italian, Thai, Japanese, Korean foods
has been increasing as years pass by that is why the company would
want to capitalize on this area by offering Filipino inspired products.

Another edge the company will be doing is to offer healthier packaged

food products such as vegetarian, seafood-based, all natural and
organic products for health-conscious consumers.

Another key success factor of the company is its convenient location

on high-traffic areas. In a competitive market, a company must go
either near its market or near its supply network. The company would
do the former since it would be profitable to the company.

Most of the customers nowadays often complain about incorrect orders

and insufficient quality of the products that is why Bananarific would
want to change the mindset of the customers by offering quick speed,
correct orders, quality food, and pleasant customer service. By
changing the mindset of the customers, it would defintely increase the
market share the company.

Targeting

new

trends

like

using

usage

of

environment-friendly

packaging such as bioplastics coming from cornstarch, wheat, and

potatoes would be another key success factor of the company. It would
not only lessen cost but it would also make the company become more
ethical.

The SAGING Program of the company would also assure benefits for
charitable homes or depressed communities. Since we will be getting
our main products from the community, it is therefore our obligation to
give back what we have got from them.

Strong

promotional

advertisements

shown

on

television,

online

webites, and even physical activities like Fun Run, athletic games and
etc., would make the customers that Bananarific do exist to fulfill their
needs. Also, skills necessary to make an effective advertisement would
be used to meet the goal of the company.

2.2 EXTERNAL FACTOR ANALYSIS

Political

The Philippine Commercial/ Mercantile Law contains current legislations

which are corporation code, insurance code, intellectual property laws,
retail trade liberalization, electronic commerce act, magna carta for
small enterprises, anti-dumping act, price act, consumer act, bulk sales
law and many more.

The FDA Philippines (Formerly the Bureau of Food and Drugs) was
created under the Philippines Department of Health as the regulatory
and enforcement organization for all food, drug, cosmetic, medical
equipment, and related products. The FDA is responsible in ensuring
the safety, purity, and quality of all prodcuts relating to; food, drugs,
cosmetics,

medical

devices

and

household

hazardous

that are

available in the Philippine market. The food and drug administration is

tasked to regulate the production, sale and traffic of these products to
protect the health and safety of the people.

Economic policies of government regarding the restaurant industry and

running eating joints; these may include licenses, inspections by
Health and Food departments, etc.

Business permits are needed for the actual processing of the desired
business enterprise.

Governmnet-owned Development Bank of the Philippines funding

through Industrial Guarantee and Loan Fund Student Assistance Grant
for Entrepreneurship (IGLF-SAGE). The program shoulders the funding
which can go up to 80% of the required business capital.

Like all other businesses, Bananarific needs to comply with the laws
required for a start-up business. One important document is the business
permit which is mandatory to all businesses. This will allow the company to
start smoothly because without this document the Philippine Government
has the power to shut down the business. In addition, once the business has
done the registration to all Government Agencies, the company then is
required to pay taxes as stated by Republic Act 8424 in the Philippine
Constitution. The Republic Act also includes Employment Taxes charged to
our employees which will enable them to avail benefits like Social Security
System (SSS), Philhealth (medical care assistance) and the like. Moreover,
since Bananarific is a food business the Government would require the
company a Sanitation Permit to ensure the cleanliness of the workplace and
the products it offers to the public through Presidential Decree No. 856.
Finally, the Government sets out standards for businesses to follow as to
promote and reinforce Republic Act No. 9003 in dealing with its
wastes/excess materials during the production process in their enterprise to
further ensure total sanitation for the safety of the companys consumers.

Economic
The food and beverage is the most important commodity. It will always
make sense to be in the food industry, whether you are a farmer, small stall
owner in a market or a multi-national giant like Tesco. But there are factors
affecting this industry.
Firstly, the production and supply of bananas. The farmers produced
more food and transported it to the market effectively due to the
introduction of technological improvements that came to farms. Additionally,
research continues searching for ways to improve food yields in the face of
an ever-growing population.Traders imported huge quantities of bananas

from India during the last season to meet the shortage in the domestic
market. This situation is one of the effects of poor management in production
and supply of bananas.
Another factor is Consumer demand. In the 1980s America began
embracing sushi and other Asian-fusion foods. According to Food & Wine
Magazine, from 1988-1998 the number of sushi bars quintupled in the United
States. Similarly, with the focus on healthy eating, as of 2010 the market for
organic foods grew to $14 billion. Related to Bananarific which offer fusion
and organic foods as consumer trends has changed.
Global warming also affects the production of bananas and other crops.
When weather damages crops, the cost of that loss increases the prices
consumers pay. Scientists study the issue of global warming for it's inevitable
long-term effect on food economics. Dramatic climate changes impact yields,
and therefore the food supply. As a solution to this problem, farmers and
producers of crops use technological advancement to minimize loss of crops
which affects the final price of the product. In a situation that happened in
Baguio, the frosting of crops affected the supply of crops such as cabbage
and other veggies.
Economic

downturn

affects

the

demand

of

consumers

to

an

enterprises product. People would go for fair priced commodities rather than
pricier ones. Bananarific sells goodies and smoothies at reasonable prices
and therefore will not be likely affected by economic downturn.
Low prices on meats, vegetables and other commodities help fast food
restaurants cut meal prices without losing profits. However, cutting prices to
attract customers can backfire when cutbacks exceed food and production
costs. For example, The Economist notes some Burger King franchise
owners sued the company in 2009, because a corporate promotion required
franchisees to sell a double cheeseburger for $1 that cost a $1.10 to make.
The court ruled in Burger King's favor. In relation with Bananarific products

such as burgers, goodies and smoothies, when cost of supply and operating
expenses is low profitability will most likely to be high.

Social
With the present trend in the food industry of having been operating a
sweet delicacies stores and novelty drinks and with so many of these are
already out in the market, people tend to look for another product that has a
new twist. Thus, this made us realize of solving such dilemma by offering the
Bananarific. However, we still have to consider several factors to see if the
business is going to hit the top.

More people are getting health conscious

- More and more people go to the gym to be physically fit and
they tend to defeat the purpose of going to the gym by eating
unhealthy foods after. Eating banana is the answer. It is one of
the best fruits to eat when losing weight because as what we
have researched, it is a diet high in potassium foods and lower
in sodium-loaded processed foods and can help reduce water

weight.
Growing number of teenage night life people
- Of course when you party, you drink alcohol. To free yourself
from alcohol, one solution is that you consume a banana.
Making it as a smoothie might create a good disposition

towards the person.

Tight-fisted and price sensitive market
- Not all consumers can afford to buy those high-class milk teas
or shakes. Pricing a product at a low cost and at the same

time offering a unique taste and at a good value might be

your competitive advantage. In the case of Bananarific, not
only we offer the latter said but also a healthy kinds of

smoothies and goodies.

Environment-friendly packs
- The government had been pushing businesses to go green but
still minimal food establishments are taking action. They still

use plastics as containers.

Adopting a community to help.

Technological
In the food industry, we need the latest technologies to be able to
produce our products faster and taste better for the customers needs and
wants.Internet connection is widespread specially in different business
enterprises. Wi-Fi is almost everywhere.Most of the people using social
networking sites like facebook and twitter which are good online
advertisements for enterprises since Internet is not only available on desktop
computers or laptops but to smartphones as well such as iphones, android
phones, and tablets. Business enterprises nowadays are having a motionactivated facilities such as sensored water basin, toilet and even doors. CCTV
cameras are also used not only in the streets of the country to observed
crimes but also used in business enterprises.
Bananarific is a snackbar which can offer Internet connection through WiFi for our customers and a buzzer / bell for them to know that their order is
ready. During special events, Bananarific can put up a photobooth for
customers who want a souveneir from Bananarific. Further, for everyones
security, Bananarific will have a CCTV camera in the store.

2.3.COMPETITORS ANALYSIS
2.3.1 Direct and Indirect Competitors
Direct
Competito
rs

Business
Profile

Product

Price

Thirsty

Fruitas

Zagu

Thirsty? Juices and Shakes is

a service oriented and
customer-driven business
selling fresh and natural
jiuces and shakes in malls,
school and other busy areas.
The products are prepared
and mized in front of the
customers as soon as they
have given their orders.

Conceptionalized to provide
Filipinos with healthy and
affordable beverage, Its
distinctive style of letting
customers handpick the
fresh fruit of their choice and
delicious taste led Fruitas to
become an instant
household name in the
country.

Shake: Avocado, Carrot,

Guyabano, Papaya,
Strawberry, Tablea Banana,
Mango, and Durian. Slush:
pineapple, watermelon,
banana, and sweet corn.
Juices: orange, mango,
apple, and carrot.

Shake: Apple, Papaya,

Mango, Banana, Melon,
Lychee, Watermelon,
Pineapple, and Carrots.
Smoothies:Apple Carrots,
Apple Banana, Apple Mango,
Apple Melon, Banana
Papaya, Banana Carrots, and
Banana Split. Juice: Any
fruits and Four Seasons.

ZAGU foods can be f

malls, supermarkets
roadside location. Be
success of every ZAG
is our professional
management team a
dedicated employee
committed to putting
customer first and a
excellence in everyth
ZAGU.
Shake: Hazelnut Cap
Mocha, Jamocha Alm
Pearl Milk Tea, Caffe
Vanilla, BukoPandan
Forest, CremeBrulee
Strawbeery, Melon,
Watermelon, Pineapp
Chocolate, Cookies a
Cream, Halo-Halo, C
Caramel, Dalandan,
Seasons.

Shake: small- 40,medium50, large-60, xlarge-70.

Slush: small-25, medium-30,
large- 35, xlarge- 45. Juice:
small- 80, medium- 90,
large-110.

Shake: small- 45, medium55, large- 85. Smoothies:

small-55, medium- 65, large95. Juice: small- 129,
medium- 149, large- 199.

Shake: Baby-z- 38, R

48, Grande- 53.

Place
(Branches)

Promotion

Direct
Competito
rs

Business
Profile

Product

Price
Place
(Branches)

Promotion

95 outlets in Luzon, Visayas,

and Mindanao.
Advertisements on television
(rctv), radio, newspapers,
and magazines; Facebook
page; Raffle Draw; Thirsty
Cup; and posters.

Black Pearl

Black Pearl caters to the

Filipinos who love the sago
in their drinks that is ideal
for the tropical weather here
in the country. Customers
can either choose flavored
powder shakes and fresh
fruit smoothies to go with
the sago.
Shake: Chocolae, Choco
Crumble, Choco Crunch,
Choco Fudge, Choco Kisses,
Choco Mousse, Cookies and
Cream, Double Dutch, Black
Forest, Rocky Road,
Cappucino, Caffe Latte, and
Mocha Frappuccino.

250 outlets in the

Philippines.

290 outlets nationwi

Advertisements on
newspaper and magazines;
FruitasWebiste; Facebook
page;and posters.

Advertisements on
newspaper and mag
ZaguWebiste; Faceb
page;and posters.

Fruit Magic
Fruit Magic pioneered the
juicing industry in the
Philippines and is currently
enjoying its popularity as the
leading source of the
freshest fruit juices and
concoctions in the country
and gave us that budtickling smoothies,
refreshing shakes, and
nutritious juices came about.
Shake: Blueberry Burst,
Strawberry Kiwi, Merry
Berries, Rasberry, Rasberry
Banana, Rasberry Mango,
Strawberry, Mango, Melon,
Green Mango, Watermelon,
and Choco Banana.

Shake: small- 32 and large39.

Shake: small- 65, medium95, and large- 125.

90 outlets in the Philippines.

70 branches nationwide.
Advertisements on
newspaper and magazines;
Fruit Magic Website; Blogs;
Facebook page; picture
contest and posters.

Advertisements on
newspaper and magazines;
Blogs; Facebook page;and
posters.

The Direct Competitors are those businesses that focuses only with fruit
shakes or juice that is their main products.

Indirect
Competito
rs

Business
Profile

Product

Moon Leaf

7-Eleven

KFC

Moonleaf's tea drinks and

mixes are made from freshly
brewed, top-quality tea
leaves imported from the
best tea-growing regions of
Taiwan. The tea is brewed,
steeped and served in
authentic Taiwanese
tradition-- no machines. You
are assured of a drink
expertly handled with a
human touch.

7-Eleven Convenience Store

aims to provide customers
an ever changing selection
of quality products and
services at fair everyday
prices, through speedy
transactions in a clean, safe
and friendly environment. To
make daily life easier by
providing modern
convenience.

The delicious taste of KFC is

a result of both our worldfamous heritage and
appreciation of local palate.
From signature recipes and
processes, product
innovations, all the way to a
deeply loved gravy, KFC
Philippines continues its
commitment to serving up
dishes and moments that
are, simply, so good.

Gulp, Slurpee, Siomao,

Hotdog, Stuffed Pandesal,
Siopao, Pastarrific, Sanwich,
Bigslice, Hotcup, Pinoy Rice
Meal, Rice Meal Express and
Siksik Meals.

Bucket Meal, Chicken & Rice

Meal,Zinger, Chik'n Fillet,
Chicken Burger, Cheese Top
Burger, Double Decker,
Chicken Sandwih, Pasta,
Mashed Potato, Mushroom
Soup, Crispy Fries, Garden
and Chicken Salad, Krushers,
Brownies, Spoonfuls, and
Twister.

Basic Tea: Black, Jasmine

Green, Wintermelon, Oolong,
Honey, Pearl Black, Pearl
Jasmine. Milk Tea: House,
Jasmine, Pearl, Pudding,
Nata, Honey, Oolong. Fruit
Tea: Lychee Jasmine,
Wintermelon Black, Passion
Fruit, Wintermelon Oolong.

Basic- 45 and 55. Milk- 60,

70 and 75. Fruit- 50, 55, and
60. Add-ons: 10 ad 15.

Price

Place
(Branches)

Promotion

36 stores in the Philippines.

Moon Leaf Website; Blogs;

Facebook page; Twitter;
freebies; and posters.

more than 40,000 stores

worldwide and 30 store
outlets in Cebu.

Advertisements on televsion,
radio, newspapers, and
magazines; Online News; 7Eleven website; Facebook
and Twitter page; Blogs;
Posters and a lot of
consumer-interactive
activities.

1pc Chicken & Rice- 75,

Bucket- 900, Chicken Burger29, Cheese Top Burger- 48,
Brownies- 21, Spoonfuls- 29,
Krushers Classic- 69,
Krushers Yoghurt- 79.
Around 13,000 outlets in the
major countries minor
countries not included. In
Cebu, there are atleast 6
branches located in SM,
Ayala, Gaisano Country Mall,
Redemptorist, Cocomall, and
Metro Cebu.
Advertisements on televsion,
radio, newspapers, and
magazines; Online News;
KFC website; Facebook and
Twitter page; Online
Delivery; House-toHouse
Delivery; Blogs; Posters;
Charity, CSR, and etc.

The Indirect Competitors also have fruit shakes or juices and food products
like burger and other delicacies. But these is not their main product they
have other products to serve the costumers compared to the direct
competitors they only have shakes/juices that they can serve to the
customers.

2.3.2.

Potential Competitors

The potential competitors of Bananarific are those who are already known in
the market, stayed longer, and gained already the loyalty of the customer.
Both

direct

and

indirect

competitors

can

be

considered

potentials

competitors since they all have been known and gain popularity in the
market.

SALES PERFORMANCE
A. Comparative Sales Report (Projected vs. Actual)
As can be seen in the table below, the sales performance of the
company for almost three months is good in terms of units and peso. The
sale of the products includes the two sizes that the company has.

Product
Actual

Sales in Units
June
Varianc
Projected
e

July
Actual

Projected

Varianc
e

Crunchy monkey
153

117

36

284

49
235

Floating bango
210

157

53

442

125

117

210

Banana
Cheeseburger

266

270

-4

440

Total

754

661

93

1376

313

129

Triple Treat

Product
Crunchy Monkey

Actual
6,334.00

Sales in Peso
June
Varianc
Projected
e
2,005.0
4,329
0

235

-100
540
1323

53

July
Actual

Projected

11,888.0
0

695

8,

Floating Bango

Varianc
e
3,193.0
0
0.00

8,718.00

5,024

5,175.00

4,095

11,970.0
0

9,720

3,694.0
0

18,598.0
0

10,0
16

Triple Treat
Banana
Cheeseburger

-25

1,080.0
0
2,250.0
0

8,779.00
19,800.0
0

8,
225
19,4
40

8,582.0
0
0.00
554.00
360.00

Total

32,197

Product
Actual

23,168

59,065

Sales in Units
August
Projecte
Variance
d

Actu
al

46,376

September
Project Varian
ed
ce

12,689

Remarks

Crunchy
monkey
278

43

224

235

235

-11

Floating
Bango

0
420

107

309

313

313

-4

Triple Treat
8

134

235
334
1275

540
1323

-206

77

-48

744

235

-101

540
1323

-463
-579

Sales in Peso
September

August
Crunchy
Monkey

Actual

Projected

Varianc
e

Actual

Projecte
d

12,15
6

8,695

3,461

9,601

8,695

Floating
Bango

Varianc
e
9
06
-

17,91
4

10,016

7,898

13,146

10,016

Triple Treat

Banana
Cheeseburger

The actual
includes
two sizes of
smoothies

0
243

Banana
Cheeseburg
er
Total

The actual
includes
two sizes of
smoothies

10,49
4
15,35
5

8,225

2,269

5,728

8,225

19,440

-4,085

3,465

19,440

3,1
30
(2,49
7)
(15,97
5)
-

The actual
includes
two sizes of
smoothies

Total

55,91
9

46,376

9,543

31,940

46,376

(14,43
6)