KPA1153 ENTREPRENEURSHIP
LECTURER PROF. DR. AZLINNA BT AZIZAN
GROUP MEMBERS TG MUHAMMAD FAIZ TG SULAIMAN
KBA15005
SUNITAH A/P MUTHUVEERAN
KBA15003
NURUL IMAN MOHD DARUS
KBA15007
NURUL ELYA AHMAD NASIR
KBA15009
MUHAMMAD HAMMAM AL-MADANI
KBA15025 0
Contents EXECUTIVE SUMMARY ............................................................................................................................ 2 INTRODUCTION ....................................................................................................................................... 3 VISION ..................................................................................................................................................... 3 OVERVIEW OF OPPORTUNITY ................................................................................................................. 4 POLITICAL FACTORS ............................................................................................................................ 5 ECONOMIC FACTORS .......................................................................................................................... 6 SOCIOCULTURAL FACTORS ................................................................................................................. 7 TECHNOLOGICAL FACTORS ................................................................................................................. 8 ENVIRONMENTAL FACTORS ................................................................................................................ 8 LEGAL FACTORS................................................................................................................................... 9 IMPACT.................................................................................................................................................. 10 MARKET FEASSIBILITY ........................................................................................................................... 11 BUSINESS CONSEPT AND BUSINESS CANVAS........................................................................................ 18 BUSINESS STRATEGY ............................................................................................................................. 22 ENLARGE PRODUCTS MARKET .......................................................................................................... 23 GIVING FREE SAMPLES ...................................................................................................................... 23 MASS COMMUNICATION .................................................................................................................. 24 PRODUCT ENDORSEMENT ................................................................................................................ 25 MARKETING STRATEGY ......................................................................................................................... 26 PRODUCT STRATEGY ......................................................................................................................... 26 PRICE STRATEGY................................................................................................................................ 27 PLACE STRATEGY ............................................................................................................................... 27 PROMOTION STRATEGY .................................................................................................................... 29 FINANCIAL MODEL ................................................................................................................................ 30 RATIO ANALYSIS ................................................................................................................................ 32 IMPLEMENTATION PLAN ...................................................................................................................... 34 STRATEGIC AND OPERATIONAL PLAN ................................................................................................... 35 SWOT ANALYSIS ................................................................................................................................ 36 RECOMMENDATION ............................................................................................................................. 38 APPENDIX .............................................................................................................................................. 39
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EXECUTIVE SUMMARY
Awareness of high quality baked goods is on the rise. Good bread is a rare combination of nutrition, convenience, and luxury. Today's consumer has less time to create wholesome, handmade bread, but increasingly appreciates the nutritional and sensory benefits it provides. Good bread provides fibre and carbohydrates in a convenient, low fat form that is portable and delicious. Good bread never goes out of style. Roti Mawar Bakery is located at Bandar Baru Jaya Gading, Kuantan, Pahang. Roti Mawar Bakery expects to catch the interest of a regular loyal customer base with its quirky and fun new packaging designs, and variety of flavours of their bread and cakes. The company aims to dominate the market in East Coast region due to the owner’s industry experience and the lack of competition in town. Roti Mawar bakery will offer a broad range of breads with unusual variety of flavours such as ‘krim vanila’, ‘krim coklat’, ‘krim jagung’, ‘inti kelapa, sardin, bilis, ikan, kacang and kaya’. The bakery will provide freshly baked cakes and pastry at all times during business hours and will also bake to order for any orders received. Roti Mawar expects an increment by 10% each year based on the previous sales as the bakery increases in popularity. The main objective is to become a local focal point of interest and to break even by the end of the year. Roti Mawar Bakery aspires to offer high quality baked goods at a competitive price that will create a loyal customer base. The bakery hopes to become a cornerstone in the community by creating a neighbourhood atmosphere where patrons feel relaxed and become instant regulars.
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INTRODUCTION
Muhammad Rafiq bin Ahmad Khan has an extensive experience in baking and has been supplying large number customers. He took over his family business from 2010. The business was established in 1980 and it was a partnership base company between Ahmad Khan bin Wajid Khan and Ramlah binti Wok. Both of them contributed RM25 000 each at the beginning of the business.
VISION
The vision of Roti Mawar is to produce quality bakery products cost effectively in an environment that is safe, clean and friendly for our employees and community. The integrity of Roti Mawar is based on the principles of quality products, satisfied customers and consumers, conscientious employees, and our commitments to innovative growth and development.
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OVERVIEW OF OPPORTUNITY
Our market is facing changes every day. Many new things develop over time and the whole scenario can alter in only a few seconds. There are some factors that are beyond your control. But, you can control a lot of these things. Businesses are greatly influenced by their environment. All the situational factors which determine day to day circumstances impact firms. So, businesses must constantly analyse the trade environment and the market. Environmental analysis is a strategic tool. It is a process to identify all the external and internal elements, which can affect the organization’s performance. The analysis entails assessing the level of threat or opportunity the factors might present. These evaluations are later translated into the decision-making process. The analysis helps align strategies with the firm’s environment. There are many strategic analysis tools that a firm can use, but some are more common. The most used detailed analysis of the environment is the PESTEL analysis and for Roti Mawar assessment, our group are using this analysis in order to analysed the company business opportunity. PESTEL is an acronym for the political, economic, sociocultural, technological, environmental, and legal contexts in which a company operates. A PESTEL analysis helps managers gain a better understanding of the opportunities and threats they face consequently, the analysis aids in building a better vision of the future business landscape and how the firm might compete profitably. This useful tool analyses for market growth or decline and, therefore, the position, potential, and direction for a business. When a company is considering entry into new markets, these factors are of considerable importance. Moreover,
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PESTEL analysis provides insight into the status of key market flatteners, both in terms of their present state and future trends.
FIGURE: PESTEL ANALYSIS POLITICAL FACTORS The political environment can have a significant influence on businesses. In addition, political factors affect consumer confidence and consumer and business spending. For instance, how stable is the political environment? This is particularly important for companies entering new markets. Government policies on regulation and taxation can vary from state to state and across national boundaries. Political considerations also encompass trade treaties, such as NAFTA, ASEAN, and EU. Such treaties tend to favour trade among the member countries but impose penalties or less favourable trade terms on non-members. As we know, Malaysia have provides a lot of government support especially to all the Bumiputera to open their SME (Small or Medium Enterprise) business. The government give the opportunity for them in terms of soft loan; provide seminars so that people or especially youngsters that would like to open the business have knowledge in that business, they provide Business Accelerator Programme (BAP), Enrichment and Enlargement Programme for SMEs, SMEs Mentoring Programme,
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Skills Upgrading Programme and many more in order to develop capable and resilient Malaysian SMEs to be competitive in the global market. Here, Roti Mawar as we know they are just established in Kuantan, Pahang. Ones they join SME they can have these advantages. They can open another branches, enlarge their business and if they didn’t have enough money for instance, they can make a loan that has been offered by the government for the SMEs’. Besides, they also can master their business skills by joining all the programmes provided by the government and besides can also enlarged their business connections.
ECONOMIC FACTORS Economic factors include all the determinants of an economy and its condition. The inflation rate, the interest rates, the monetary or fiscal policies, the foreign exchange rates that affect imports and exports, all these determine the direction in which an economy might move, therefore businesses analysed this factor based on their environment so as to build strategies that fall in line with all the changes that are about to occur. Today, as we can see our Malaysian current situation is not really good. Our currency Ringgit Malaysia is definitely not really good compared to USD dollar like RM 1 to USD 4.2 right now. So here, the government will encourage people to buy local products more and this would intense to increase our productivity of local product brands including Roti Mawar. So, this is the new business opportunity that would arise and can be seen as a very good opportunity to Roti Mawar as people ought to buy more local products such Roti Mawar.
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SOCIOCULTURAL FACTORS The social and cultural influences on business vary from country to country. Depending on the type of business, factors such as the local languages, the dominant religions, the cultural views toward leisure time, and the age and lifespan demographics may be critical. Local sociocultural characteristics also include attitudes toward consumerism, environmentalism, and the roles of men and women in society. Every country is different and every country has a unique mind-set. These mind-sets cast an impact on the businesses and the sales of their products and services; therefore PESTEL analysis includes these factors as well. The cultural implications, the gender and connected demographics, the social lifestyles, the domestic structures; all of these are studied by companies to understand the market and the consumer better. Roti Mawar includes not only breads but also cakes and cookies (during Hari Raya) with variety of flavours that can be choose. Here the company can take this opportunity by approaching academicals institution (colleges, schools), organisations or government sectors to supply their products. This is because, these organisations and institutions would normally handle or doing the events that involved with publics. For instance, local council Majlis Perbandaran Kuantan (MPK) will do ‘Kuantan Rekreasi’ cooperate with private sectors and other organisations every month in all over Kuantan area. So here by having a business deal with them will give good opportunity to the company to enlarge their business, build their brands and marketing their products as well.
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TECHNOLOGICAL FACTORS Technology greatly influence a business, therefore PESTEL analysis is conducted upon these factors too. Technology changes every minute and therefore companies need to stay connected along the way and integrate as and when needed. Also, these factors are analysed to understand how the consumers react to technological trends and how they utilize them for their benefit. This technological factor can gives lots of opportunities to Roti Mawar for instance in terms of online marketing because the things is today, many people here nowadays use social media networks such as Facebook, Twitter and Instagram to market their products. This is because it is relatively easy and very cheap to market their product in all around the world.
Besides, in terms of packaging design
nowadays we have lots of software such as Photoshop so they can create and design very attractive new fresh packaging design that suit the taste of new young generations besides can safe lots of money since the company didn’t have to invest so much for instance hiring designer that are costly. So in terms of technology, there are lots of opportunities for Roti Mawar to venture it more.
ENVIRONMENTAL FACTORS The location of countries will also influence on the trades that businesses do. Adding to that, many climatic changes alter the trade of industries and the way consumers react towards a certain offering that is launched in the market. The environmental factors include geographical location, the climate, weather and other such factors that are not just limited to climatic conditions. These in particular affect the agri-businesses, farming sectors and others.
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For Roti Mawar this is one of the opportunities for the company seems their brand and their products is one of the longest in the industry which was established since year 1980 especially in east coast region. The company can take this opportunity to enlarge their business, penetrating more markets and also takes this opportunity to approach customers.
LEGAL FACTORS Legislative changes occur from time to time and many of them affect the business environment. For example, if a regulatory body would set up a regulation for the industries, then that law would impact all the industries and business that strife in that economy, therefore businesses also analysed the legal developments happening in their environment. In terms of licensing, all business in whatever industry not only in Kuantan but also in all state in Malaysia must have license in order to operate their business. So here for instance, Kuantan Municipal Council (MPK), they give priority for Bumiputera whoever wants to apply for license to do the business. This will gives an opportunity for Roti Mawar that can be take in order for the company to enlarge their business, to open another branches especially in town area so that their products can easily reached by the people and also later on will strengthen their brands that will make their product be in the same level as other famous products such as Gardenia.
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IMPACT
Business impact or business impact analysis is a systematic process to determine and evaluate the potential effects of a positive or negative
crucial interruption to
the business operations as a result of PESTEL analysis . In terms of Roti Mawar, there are many positive business impacts in terms of political support cause the owner is Bumiputera and can obtain and apply loans easier than competitors. Another factor is the economic situation which gives a push toward local products and this is where Roti Mawar takes positive impact. Thirdly is the social and cultural influences, it effects Roti Mawar Product, variety of products are prepared such as bread, cookies, cakes to satisfy the diverse cultures and thus have bigger revenue than if Roti Mawar only serves single culture. Next is the technology factor which influences largely Roti Mawar marketing strongly. Nowadays, everything needs to be related to media such as facebook, instagram, twitter, and other popular media that have big populations. Technology is the easiest and most effective way to double or even triple the revenue. Furthermore, Environmental factor plays vital role for Roti Mawar also since its location is not effected by floods during moon season where many parts of the state stops operation. Legal factor gives a positive impact too for Roti Mawar when it comes for expanding and branching. The advantages come from licensing the new outlets easier since the government encourages Bumiputera to enlarge their businesses.
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MARKET FEASSIBILITY
Feasibility study aims to objectively discover the strengths and weaknesses of current business or proposed venture, opportunities and threats present in the environment, the resources required to carry through, and ultimately the prospects for success in the future. Market feasibility looks through the viability of the idea of the business and identify potential problem to business and does it have good market prospect to become successful. As for our market feasibility study we have develop a set of questionnaire. The questionnaire is divided into 3 separates sections, first section is a yes or no question, and second section is rating scale questions and third is open ended questions. The questionnaire is distributed at HospiMart, Sekolah Rendah Ibnu Abbas, Akar Kopi restaurant and around Jaya Gading areas. These are areas where Roti Mawar can be found and distributed. A total of 40 respondents have answer the questionnaire and we analyze based on sample of 40.
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FIRST SECTION In the first section there are total of six questions: 1. Is the product highly demanded? 2. Is the price of product competitive? 3. Is the product easy to obtain? 4. Is the product affordable? 5. Is the product delicious? 6. Is the product worth of your money? Basically the first section questions asked the attractiveness, the taste and the demand of the product to the customers. Following table and chart summarize the answers. Question no
YES
NO
1 2 3 4 5 6
22 30 17 28 29 24
18 10 23 12 11 16
Table 1
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We can see from the results majority of the respondents answer yes for questions in the first section except for question 3 which asked the difficulty in obtaining product from Roti Mawar and most of the respondent answer no which clearly shows that product in Roti Mawar is difficult to buy as it does not distribute at main supermarket such as Tunas Manja, Terus Maju or even in hypermarket such as Giant and Aeon. Apart from that we can clearly summarize from the first section that Roti Mawar product is indeed high in demand, competitive against other bread product, the price is affordable, product is really delicious and tasty and it is worth value of money.
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SECOND SECTION In the second section rating scale questions are asked. From scale of 1 to 5 with 1 represents worst possible score and 5 represents best possible score give your rating for each questions: 7. How attractive the promotion? 8. How attractive the product? 9. How attractive is the packaging? 10. How is the quality of product? 11. How will you rate this product against its competitor? This second section questions mainly asked the attractiveness of the promotion, product, packaging and quality and also competitiveness of the product from Roti Mawar. Table and chart below represents figure of the answers by respondents. Question no
11
-
7 8 9 10 11
13
16
1
2
3
4
5
5 2 -
7 12 8
16 12 19 6
8 18 9 15
4 10 9
Table 2
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The table and chart above summarize the answers in section 2. As we can see question number 7 that asked attractiveness of the promotion majority give average rating as Roti Mawar does not really do good enough promotion for their product. For question number 8 that asked the product attractiveness majority give positive rating between 3 to 5 which shows the product of Roti Mawar can attract customers. On the packaging side majority gave average rating as Roti Mawar packaging is too simple to attract customer. On the product quality most gave rating of 4 which shows the product is indeed quality. And finally on its competitiveness most gave rating of 4 which proves the product is high in competitiveness and able to compete with other bread products.
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THIRD SECTION In the third section we asked open ended questions which asked the opinion of the people about Roti Mawar. Questions are as follow: 12. What other additional product/service you wish for from our company? 13. How do you know about the product? 14. How much you willing to spend for the product? 15. How often would you buy the product 16. Would you recommend the product to your friends? 17. Where would you like this product to be sold? The results are summarize in the table below: Question no
YES
12
Cakes, cupcakes, roti arab
13
Friends, advertisements, word of mouth
14
Range from RM5-RM10
15
Three times a week, Twice a week, Once a week
16 17
30
NO
10
Supermarket, Petrol stations, 7Eleven, University kiosk
Table 3
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The third section asked opinions of the respondents about Roti Mawar. First question asked in the third section was what other products expected from Roti Mawar and most of the respondents answer were cakes, cupcakes and surprisingly Roti Arab which has become high in demand lately in many Nasi Arab restaurants. The second question asked how do the respondents know about Roti Mawar and most of them answer introduction by friends, word of mouth from people in surrounding and also advertisement banner which shows most of them know of Roti Mawar through their acquaintance and there is not enough marketing effort done by Roti Mawar. Next we asked how many they willing to spend on Roti Mawar products most answers ranging from RM5 to RM10 which is normal for daily consume product. And how many times they would buy the products most common answers were three times a week, two times a week and once a week. And 30 out of 40 respondents would recommend the product of Roti Mawar to their friends which shows the product is indeed tasty and delicious. Finally most of them would love to see the products sold at Supermarket, petrol stations, 7Eleven and also university kiosk in UMP where it will be easier for people to purchase Roti Mawar and proof there are numbers of people seeking for Roti Mawar products.
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BUSINESS CONSEPT AND BUSINESS CANVAS
Roti Mawar business model is its plan or diagram for how it competes, uses its resources, structures its relationships, interfaces with customers, and creates value to sustain itself on the basis of the profits it generates. Business Canvas for Roti Mawar is shown below:
Figure 1: Business Canvas Roti Mawar
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CUSTOMER SEGMENTS Roti Mawar has successfully established and targeted its customer segments that are normally hard to obtain and easy to operate. Roti Mawar was able to obtain contracts to supply Roti Mawar to four major government sectors which are army camp, care and cure center, Penor Prison, and Hospital marts. Those four major targeted customers provides the stability of Roti Mawar Sales. The stability of sales is because of the constant standard order from those four major customers which makes it even easy for Roti Mawar to look after potential product development or market development in the future. CUSTOMER RELATIONSHIPS Roti Mawar, for around 20 years, is building a good Rapport to get more contracts. The perfect pricing and quality of Roti Mawar gives it a special advantage against its competitors. Besides that, the fact that the owner of the company is bumiputera highly strengthens the customer relationship. CHANNELS The methods used to secure sales are advertisements and contractual agreements. Those two methods can be summarized on how Roti Mawar approach their customers . This part is where technology is needed more to build up a stronger rapport for the coming years. VALUE PROPOSITIONS Value Propositions are the values Roti Mawar intends to deliver to their customers. First value as stated by the company owner is the provision of constantly healthy and fresh bread. This value only enabled Roti Mawar to secure four major government contracts and revenue. The second value is diversify its products to delicious cakes. Here Roti Mawar did not only limit its business to roti only, it expanded to cakes. To add on, biscuit ray is also 19
made by Roti Mawar to share the happiness of Raya with all people and become a symbol of Raya in the community. Last but not the least, cookies is also baked and delivered to their major customers for their break times. ACTIVITIES Roti Mawar conducts several routine activities cause the bakery is not fully automated. Those activities include mixing yeast to the flour, transferring the mixed dough to the kneading machine, adding water, slicing the dough, making boll shape dough, flatting the dough, baking the dough, packing the product, and lastly delivering to customers. RESOURCES The main resources used at Roti Mawar are many but the major is human resources. The staff working inside the bakery who conduct the activities and run the bakery. There are other resources used at Roti Mawar as well such as flour, yeast, water, electricity, oven, and the kneading machine. KEY PLAYERS Roti Mawar lists three key partners to their business. First key partner is flour and yeast supplier. Roti Mawar Listed flour and yeast supplier as a key partner because of the business nature is baking and the main ingredient is flour and yeast. The second key partner is machinery provider. Machinery needs regular maintenance such as the oven, kneading machine, and ball shaping machine. Last but not the least, Persatuan Roti Semenanjung.
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COST STRUCTURE The term refers to the types and relative proportions of fixed and variable costs that a business incurs. The concept can be defined in smaller units, such as by product, service, product line, customer, division, or geographic region. In the term of Roti Mawar, cost structure refers to raw material cost, labor cost, and overhead cost. REVENEU MODLE The amount of money that a company actually receives during a specific period, including discounts and deductions for returned merchandise. It is the "top line" or "gross income" figure from which costs are subtracted to determine net income. Roti Mawar main revenue comes from two main sources, direct sales and constant contract sales. BUSINESS CONCEPT Roti Mawar is a family owned business located at Taman Tas, Gambang, Kuantan Pahang. The business is was firstly opened on 1980s, and since then and up to now, it has built a very strong rapport to be the supplier to the government sectors as well as private sectors. The business is about loyalty of customer to Roti Mawar and more importantly the loyalty of Roti Mawar to sustain the product quality and always look after improving the product scope and market scope to make it accessible to all of our customers.
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BUSINESS STRATEGY
A company business strategy consists of the competitive moves and a business approach that the managers are employing to grow the business, attract and please customers, compete successfully, conduct operations and achieves the targeted levels of organisational performance. A company achieves sustainable competitive advantage when an attractive number of buyers prefers it products over the offerings of competitors and when the basis for this preference is durable. The graph below shows the current situation of Roti Mawar compared to the competitors which are Gardenia and High 5 brand and also the business strategy that the company can do in future in order to market their products, enlarge their current business and strengthen their brand’s name.
Scoring
Industry Strategy Canvas 10 8 6 4 2 0
Roti Mawar Future Roti Mawar Current Gardenia
Factors of Competition
High 5
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From this graph we can see that the current levels of Roti Mawar products’ brand are still lower if compared to these two quite establish and well-known brand which are Gardenia and High 5. ENLARGE PRODUCTS MARKET The first business strategy that Roti Mawar can take is by enlarging products market. This is because, currently base on observation even Roti Mawar is a local products which is originally base in Kuantan, Pahang but the products are only easy to get or seen in the area of Bandar Baru Jaya Gading seems they are operate in that area which are far from the Kuantan town. This actually will limit their products market. So, what the company should do is to take the advantage to increase and enlarge their markets especially in Pahang and in East Coast region for instance in Kelantan and Kuala Terengganu as well seems they are base in East Coast area. The company can maximise their supply by supplying it in all the mini or supermarkets, school canteen, hospitals mart and many more in towns so that their product can easily be found and get by the customers and makes everyone aware of the products. By doing this it also will increase their brands name. Besides, this also gives advantage to them seems they are base in local area and thus they can already save the transportation charges and there is not more established brands name in this bakery industry in the east coast region and this opportunity should be grab fast by the company so that they can conquer the market. GIVING FREE SAMPLES The second business strategy than can be taken by the Roti Mawar is by giving the free samples to the public or the targeted group of populations. This is because by giving free samples of the products to the targeted groups the company can immediately increasing awareness of the products as these targeted groups will spread 23
the brands with others in their friendship group. Besides, if the free sample products been giving out in person, the company might be able to receive some instant feedback. Include a hash tag and been promote or recommended by the customer in social networking for instance Facebook or Twitter and its likely the company are getting some online feedback and the company can re-tweet the most positive endorsements that the company’s product receives, further improving brand awareness. Besides, when the product becomes famous for instance has been mostly been mention in social networking, the company might receive some press coverage or internet buzz about the company and the products. This indirectly can increase and enlarge products marketing not only in the country but also all around the world without a need to invest lots sum of money. MASS COMMUNICATION Next, Roti Mawar Company can fully use the facility usage of mass communication. Mass communication is widely used in the fields of business. Nowadays, it plays a vital role in establishing relationship with the market. People are required to know about the product or services provided by a business concern. Without any publicity, it is impossible to compete in the market. Such publicity is conveniently done through mass media. As here nowadays we always heard the power of social media especially Facebook, Twitter and Instagram. The company should grab this opportunity as one of the business strategy. This is because, social media marketing is the “next big thing,” a temporary yet powerful fad that must be taken advantage of while it’s still in the spotlight. Every post that has been made on a social media platform is an opportunity for customers to convert. When the company successfully build a following, they simultaneously have access to new customers, recent customers, and old customers, and the company also will be able to interact 24
with all of them. Every blog post, image, video, or comment that been shared is a chance for someone to react, and every reaction could lead to a site visit, and eventually a conversion. Not every interaction with the company’s brand results in a conversion, but every positive interaction increases the likelihood of an eventual conversion. This indirectly also can help to increase company’s brand recognition and also improved brand loyalty. PRODUCT ENDORSEMENT The next strategy that can be implemented by Roti Mawar is through product endorsement. In general, product endorsement can be define as a written or public statement by a celebrity, business or professional group extolling the virtues of a product and recommending the use of the product to the public. Todays, we can see that a product endorsement from an authoritative figure is a key element in business advertising and marketing campaigns and promotions. In fact, some of the biggest brands with the biggest budgets already understand the power of celebrity. This is because having a celebrity associated with your product or service provides two very important things to your brand which are aspiration and credibility. So, when Roti Mawar brand already jump into another high level, the company could use this product endorsement as one of the business strategy to bring Roti Mawar’s name to another successful level.
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MARKETING STRATEGY Marketing can be defined as a “satisfying needs and wants through an exchange process”. In addition, marketing also can be defined as the process of planning and executing the conception, pricing, promotion and distributions of goods and services to satisfy individual and organization objectives. Without a suitable marketing plan, business may never achieve its goals and resources such as capital, land and labour can be wasted. Marketing is a crucial and critical aspect in business and always referred as the backbone to any business in achieving a profitable outcome. A lack of understanding of the marketing concept can result in poor development of product that fails to meet the customer’s needs and wants. Business marketing strategy is the single biggest factor which determined the success or failure of business. Marketing strategy is a business marketing policy, usually outlined in a formal marketing plan and it is the fundamental goal of increasing sales and achieving a sustainable competitive advantage. Marketing strategies are generally concerned with marketing mix principles and also known as 4Ps. It is used by business to assist in pursuing the business’s objectives. The 4Ps in marketing strategy are:
PRODUCT STRATEGY The first marketing strategy in 4P’s basically begun with the product/service offering.
Roti Mawar is a well-known brand.
Just by recognize the brand,
obviously people may know what are the company is going to serve. For those who were born in 1980, surely they are familiar with this product. They consume the products for ages and usually they maintain the consumption and introduce it to the next generation. They are very loyal customers.
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Besides that, Roti Mawar will introduce new product which never been produced before and that are bread with different cream such as vanilla cream, chocolate cream and corn cream. In addition, there are bread with different filling such as kaya, sardine, coconut, red bean, anchovy and curry filling. Vast choice of cream and filling will contribute to a large crowd of people because every person has different taste. Roti Mawar also is about to produce Roti Arab and their signature coffee. The purpose of producing Roti Arab is to cater the demand of Arabic Restaurant and the growing population of International students especially from Middle East country. In a near future, Roti Mawar is expected to open a Café in front of the factory and the main menus are freshly-baked bread served with their own secret recipe coffee.
PRICE STRATEGY The second most important strategy in business is price strategy. Even though most of the sellers increase price of their product due to the implementation of 6% of GST, Roti Mawar, however still maintain their reasonable price. The price of the product excludes 6% of GST which mean that the customer will enjoy the same price as before the implementation of GST.
PLACE STRATEGY Place represents the location where a product can be purchased. Sometimes, it often referred as the distribution channel. Distribution channels are the ways that goods and services are made available for use by the consumers. All goods go through channels of distribution, and your marketing will depend on the way your goods are distributed. The route that the product takes on its way from production to the consumer is important because a marketer must decide which route or 27
channel is best for his particular product. For Roti Mawar, the distributions of their breads are:
1. Selling through retailer
Selling goods through a retail channel extends the geographical reach of the business.
By utilizing an existing retail network, Roti Mawar can expand
geographical operations quickly and easily. Retailers hold stock of the products at their sites, reducing stock-holding and distribution costs to the company. Customers take delivery of the products at the local outlet so that Roti Mawar does not incur delivery costs. Roti Mawar found that this channel is best for their product. Almost 85% of their sales came from this distribution channel and until now, they remain as a loyal middleman to the company. Below are the major retailers of Roti Mawar:
During the interview session, we have suggested to the company to spread out their product and enlarge their distribution channel. The company can display its products on racks in convenience stores. By doing so, they are penetrating into a new market.
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2. Direct to customer
Direct consumer selling is the oldest way of selling the goods. Under this system, the goods are directly sold to the consumer by the producers. In the case of Roti Mawar, the consumer comes to them to purchase the goods. For example, customers go to manufacturer’s premises and purchase the product after due satisfaction by understanding various technicalities involved in the product. Roti Mawar can conveniently carry the twin functions of production and distribution effectively.
Direct consumer selling results in reducing the profit margin of
middlemen and helps the customers to get the products at comparatively cheap price. This enhances the sales.
PROMOTION STRATEGY Promotion strategy is a key activity in every marketing plan. It is aimed at increasing sales in the short term by employing promotion schemes which effectively increases the customer awareness of the business and its products. Despite the multitude of media platforms available, verbal buzz about Roti Mawar passed from one reliable person to the next is still the most cost-effective way to build a loyal customer. It was believed that the word-of-mouth marketing that’s make Roti Mawar gaining its popularity. Besides that, the company use a modern approach to market their product which are through mass media like Facebook.
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FINANCIAL MODEL Financial model is very important in every business as it give exact figure representation of the company asset and liability also look at the cost incur by the company and how much profit they make. Through this financial model we will able to gauge the company ability, their profitability and also be able to forecast the company profit and loss in the future. In this section of the report we will discuss the financial structure of Roti Mawar. First we will look at the projected profit and loss forecast for Roti Mawar. We assume Roti Mawar will have a steady 10% growth each year in sales after introducing new product line of Roti Arab and improved marketing effort.
Sales 1200000 1000000
993183.5086 902894.0987
800000
820812.817 746193.47
600000 400000 200000 0 2015
2016
2017
2018
Series 1
Chart 3
As the sales projected we can see Roti Mawar will able to have steady growth of 10% each year in sales which also result in improve profit and loss income.
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Profit&Loss 160,000.00 140,000.00 120,000.00 100,000.00 80,000.00 60,000.00 40,000.00 20,000.00 0.00 -20,000.00
2015
2016
2017
2018
Series 1
Chart 4
As we can see net income for Roti Mawar started negative in 2015 with –RM8927.43 but steadily improve throughout the next three years with RM37 598.24, RM88 499.61 and RM145 110.20 respectively. In our profit and loss account we assume the marketing and admin expense will remain the same throughout the four years period, cost of goods sold and operating expense will increase proportionately according to sales increase, there are zero interest, the tax rate is constant at 9% per annum with no change throughout the 4 years period and the depreciation of fixed asset is at 10% each year calculated using straight line method.
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RATIO ANALYSIS The ratios are divided into profitability ratios, liquidity ratio and overall financial stability ratios. These ratios are used to forecast the business performance of Syarikat Roti Mawar. The profit margin showing that the business is able to make profit for next three years. The positive movement is aligned with the other two ratios; return on equity and return on assets. Liquidity ratio is expected to move positively for the three consecutive years. It is mean that the business is able to liquidate the assets to cover the liabilities. The business will productively utilize its assets. From the overall financial stability ratio, the debt and debt to equity ratio show a good movement where it decreasing year by year. It will have no trouble meeting its obligations and securing the level of financing needed to enhance its growth.
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IMPLEMENTATION PLAN Implementation plan will discuss on how we are going to conduct our proposed strategies for Roti Mawar. Basically our main focus is on introducing new product line which is Roti Arab which will boost the sales of Roti Mawar. Our group members Madani has a friend who is expert in baking Roti Arab. He will introduce this friend and his friend will teach Roti Mawar workers on the basic ingredients needed and how to bake delicious Roti Arab. No extra equipment needed to purchase as Roti Mawar already has all full equipment in baking bread. The only thing they need is basic knowledge. Roti Mawar will start producing Roti Arab for Nasi Arab restaurant in Gambang called Land of Paradise as their first main customer. And later we will try to penetrate into other Nasi Arab restaurants around Kuantan area such as Zam Zam and Dallah restaurants. In the next few years we aim for Roti Mawar to be one of major supplier for Roti Mawar in east coast region. As for marketing effort basically we think social media networking is the best medium in doing marketing strategies. We will create Twitter, Instagram and update their Facebook account. Later we will post pictures of location, products and promotion held by Roti Mawar and lots more with creative design which will attracts many followers. This will capture new customer market especially the young and IT savvy people.
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STRATEGIC AND OPERATIONAL PLAN
In any business that we want to set up, an operation objective is important element that should be add on in order to ensure that the business will be run smoothly and accordingly. The successful of the business is depending on how the effective of the operation in the business itself. The smoothly and a well condition of operation can lead the business achieved the goal easily without face any difficulties that hinder the success of the business. The reason to include a SWOT analysis in the Strategic Plan is to help us determine the best opportunities to pursue to achieve growth goals. It also helps us identify which strengths we must develop in the near future to improve the company.
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SWOT ANALYSIS A SWOT analysis is a structured planning method used to evaluate the strengths, weaknesses, opportunities and threats involved in a business venture.
A SWOT analysis can be carried
out for a product, place, industry or person. Strengths and weaknesses are often internal to our organization, while opportunities and threats generally relate to external factors. Below is a SWOT analysis for Roti Mawar.
Based on this information, further analysis can be made through SWOT Matrix where all four elements are matched to produce best strategy planning for Roti Mawar. Below are the outcomes of this method.
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SO Strategy SO Strategy is formed when Strengths and Opportunities elements are matched. 1) Roti Mawar will have well-trained, skilled labors in production and management. (S4, S5, O1) 2) The product originality and quality will be protected. (S1, S3, O3) WO Strategy WO Strategy is a matched of Weaknesses and Opportunities elements. 1) Established brand for Roti Mawar products. (W4, O4) 2) Improved advertising skills by using the internet and the changing trend of lifestyle. (W3, O2) 3) Improved product quality. (W2, O4) ST Strategy ST strategy is a matching of Strengths and Threats elements in SWOT analysis. 1) Increase product price in order to cover the cost. (S2, T1,T3) 2) Aggressive advertising to reach more customers. (S1, T2) WT Strategy This is a stage of Weaknesses is matched to Threats. 1) Established proper documentation. (W1, W3, T1) 2) Find more distributors or other channels in reaching the customers. (W7, T2, T3, T5) 3) Established more trusted suppliers. (W9, T4)
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Roti Mawar operates six days a week with five workers. They will be off on Sunday and work half day on Saturday. The workers will begin their work at 8.00am and finish by 5.00pm.
All workers plays a very important role in ensure that the business running
smoothly. They are responsible in ensuring the process of making the breads is in time and the delivery of the bread perfectly just in time. They are also having the responsibilities in cleanliness and must ensure that the apparatus and equipment are in good condition and safe to be use. The workers are totally have been supervised and trained in order to manage the stocks properly and based on the guidelines as to maintain the quality of product.
RECOMMENDATION It is important to be different than other in the industry because only the most unique and rare product can survive to the last breath. As we know, Roti Mawar is offering the same type of products and thus, it is an advantage if the company can produce Rati Arab as suggested by one of our group member. Roti Mawar will be a supplier to Nasi Arab restaurant in Gambang called Land of Paradise.
And later the company should try to
penetrate into other Nasi Arab restaurants around Kuantan area such as Zam Zam and Dallah restaurants. In the next few years, Roti Mawar to be one of major supplier for Roti Mawar in east coast region. Insya Allah.
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APPENDIX
The introduction of new bread with different cream and filling. 39
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Market feasibility questionnaire sample
Business card
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Market feasibility answered questionnaire sample
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