The strategic objective of to maintain its dominance of the barbecue fast food industry here in the Philippines by adding more and healthier products, branching out thirty more branches in Mindanao, increasing its advertising efforts through hiring new product endorsers, taking advantage of advertising on public mass transportation systems and fixing administrative deficiencies.
Mang Inasal is currently on top of the barbecue fastfood industry. In 2011, Mang Inasal generated a gross profit of P432, 200,000.00 and total expenses of P383, 100,000.00. Mang Inasal was able to achieve a net income of P49, 100,000.00 and Mang Inasal’s liabilities amount to P374, 943,939.00. However, Edgar "Injap" Sia, founder and CEO Mang Inasal, knows that there would come a time when Mang Inasal will stop expanding. The question will be how will Mang Inasal handle an inevitable drop in sales and expansion. An assessment of their strength and weaknesses, along with the external opportunities and threats, has concluded that Mang Inasal should focus more on product development.
Mang Inasal has been dominating the middle class. Most of their consumers are students and people from the labor force. It would be very important for them to continue dominating this class because here in the Philippines about 35% of the population is part of the labor force and are students.
b. Recommended Strategies 1. Market Development Strategies
Opening 30 more branches in Mindanao will be a very important business move for Mang Inasal. Mang Inasal have successfully opened branches in different key citites and provinces in Luzon and Visayas. However, Mang Inasal must realize that branching out in Mindanao will be very beneficial to them especially if they will be able to open up branches in the key cities and provinces in Mindanao.
2. Market Penetration Strategies
a. S1-O1 Hire new product endorsers
b. S1-O5 Increase brand visibility by taking advantage of advertising on mass transportation systems
c. S1-T1-T5 Intensify social media marketing
Mang Inasal’s initiative to promote and advertise their products is one of the best ways to increase their sales. Aside from this, because of the trending barbecue fastfood industry Mang Inasal’s promotions will yield much better and positive results. Instead of relying on Mark Bautista alone Mang Inasal must hire more endorsers for their ptoduct. Visayan celebrities will be very effective to be their product endorsers. Mang Inasal also has a number of gigantic billboards around the metro. However, Mang Inasal must also invest in advertising on mass transportation systems like MRT, LRT 1 and 2, and PNR. People on the go will be able to see this as they ride these transportation systems. Social media channels like Twitter and Facebook will provide free advertising.
d. S1-S4-S5-O4 Organize a Mang Inasal Franchise Summit to attract potential franchisees
Through this franchise summit, Mang Inasal will be able to discuss and explain the nature and procedures of a branch and acquring a franchise. This will help Mang Inasal attract potential franchisees.
3. Product Development
a. W4-O4 Form a department for regulating and evaluating branches and employee performances to enhance employee competency and branch longevity for potential franchisees
b. W1-W4-T2 Set up a sanitation compliance team to ensure that sanitary standards are met for each branch
Mang Inasal must establish an Evaluation and Regulatory Department as well as a Sanitation Compliance Team. These two newly instituted departments will help maintain above average employee performances and a relatively healthy franchise fiscal year performance.
c. W1-W2-O3 Conduct research through mobile and online surveys
Customer loyalty is very difficult to quantify or qualify because a lot of factors must be taken into account. However, conducting mobile and online survey will enable Mang Inasal learn how consumers perceive they brand and products.
d. W3-O3 Build a smooth communication channel for faster distribution of products from the supplier to the branches
communication channel between the distributor (commissary) and the branch so that delivery and emergency replenishment of stocks will be set and will be on time.
c. Financial Projection Financial Objective
The financial objectives of Mang Inasal are to increase its net income by 25% and increase in return of equity by 50% consecutively through 2012, 2013, and 2014.
Financial Assumptions
This year, as Mang Inasal faces its competitors (i.e. Chic-boy and Bacolod Chicken Inasal), Mang Inasal may experience a slower growth than before (also considering inflation and exchange rates).
Expected Success Rate of Marketing Programs
Mang Inasal has been doing quite well in terms of how they sell their goods. As Mang Inasal hires more potential workers/employees (but not too much, as it will lead to "diseconomies of scale"), they are becoming more efficient in terms of the efficiency and accuracy of its services.
Market Condition
The fast food industry has been growing and (expectedly) will still continue to grow in the future. With this assumption, there will/might come a time when Mang Inasal will be "outmatched" by another fast food company.
Equipment Performance/Durability
As technology advances and as Mang Inasal continues (hopefully) to grow, Mang Inasal would be able to purchase more advanced equipments that will improve the efficiency in selling/producing their products.
Ease of Credit Collection
Mang Inasal assumes that none of its receivables are impaired (as of 2011), which means that over the past years, the business had no problem dealing with credit sales. But as the number of Mang Inasal's customers is increasing, they will find it more difficult to collect its receivables.
Ratio against
competitors INASAL MANG CHIC-BOY BCI Rating
1. CURRENT RATIO
1.19
0.79 0.29 +
2. QUICK RATIO 0.93 0.61 n/a + 3. INVENTORY TURNOVER 23.29 13.96 n/a + 4. DEBT RATIO 0.28 0.41 2.05 + 5. TIMES INTEREST EARNED 41.83 5.14 n/a + 6. OPERATING INCOME RETURN ON INVESTMENT 0.47 0.14 -1.19 + 7. OPERATING PROFIT MARGIN 0.13 0.12 -0.26 + 8. TOTAL ASSET TURNOVER 3.77 0.37 4.57 + 9. FIXED ASSET TURNOVER 11.93 0.74 13.2 8 + 10. RETURN ON EQUITY 0.79 0.13 -0.7 + 11. RETURN ON ASSET 0.33 0.08 -1.19 +
From a financial perspective, Mang Inasal is doing better than its competitors. Ultimately, Mang Inasal has the greatest return on equity with a ratio of 0.79 during the year 2010, compared to that of Chic-boy and Barbecue Chicken Inasal (BCI) with ratios 0.13 and 0.7 (deficiency), respectively. (The “n/a” indicated on BCI Inasal is because BCI has no report on its inventory and interest expense.)
MANG INASAL