R.E.

HERNANDEZ MERCHANDISE: MARKETING PLAN

I. EXECUTIVE SUMMARY

R.E. Hernandez Merchandise, is a small, family-owned business. The

business offers high-quality goods—school supplies, household tools and

equipments, products that are on trend, and plastic wares. Although R.E.

Hernandez Merchandise was launched for 8 years already, the business has

experienced greater-than-anticipated demand for its products. R.E. Hernandez

Merchandise is highly seasonal, with its greatest demand during June, July,

November, and December. An evaluation of the company’s internal strengths and

weaknesses and external opportunities and threats served as the foundation for

this strategic analysis and marketing plan.

The plan focuses on the company’s growth strategy, suggesting ways in

which it can build on existing customer relationships, and on the development of

new products and/or services targeted to specific customer niches. In addition,

R.E. Hernandez Merchandise plans to explore more opportunities. The

marketing environment has been very receptive to the business’ high-quality

goods—school supplies, household tools and equipments, products that are on

trend, and plastic wares that reflect the interests of our target market. By next

year, R.E. Hernandez Merchandise also aims to increase its market size, offer

new products, win new customers, and give back to the community.

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 II. SITUATION ANALYSIS

Mission Statement

Keeping the products with the quality and trends that the customers desired to

consume.

Vision Statement

Our ultimate goal is to provide affordable and appealing products to the

customers and delivers an exceptional experience to them in purchasing to our

products.

A. Market Analysis

1. Market Size

Bamban Tarlac has a number of populations of 69, 466 for the census in

year 2015. R. E Hernadez is located in Dapdap which is a part of Bamban.

According to the owner (Mrs. Rosalie Hernadez) her estimated number of

customers a day is not less than 50 or more than 100 and her goal in the

future is to accommodate 100 to 200.

2. Market Growth Rate

By the year of 2017, the business’ market size is 350,000 pesos.

The current market size in the year of 2018 is 500,000 pesos.

From this prior and current figure, we can identify the change in
 market within the year of 2017 to 2018. The market that was

350,000 one year ago and was 500,000 pesos of sales this year

had a growth rate of 43% over the past year.

3. Market Profitability

The current profit that the business was able to make is 43%

from sales and in the future, the owners still expect that the

profit rate will increase up to 80%

The market potential of the business is dicussed below using the

Porter's five forces:

 Buyer Power – The R. E Hernandez offer high-quality products with

affordable prize that attracts more customers. Besides from the

affordable price, the business make sure that the customers are

comfortable with them to have the assurance that they will come back

to buy again.

 Supplier Power – The owner of the business has suppliers in Angeles

and Manila (Divisoria). Fortunately, having a long-time connection with

these suppliers, the business often get discounted products from them.

 Threat and Substitute Products – The starting products of the business

are school supplies but the business also offer some products that

customers use in everyday life. They are having seasonal products as

 substitute for months that has low demand for school supplies such as

summer break and Christmas break.

 Rivalry among firms in the Industry – To treat the rivalry with the other

business, R.E Hernandez offer products with lower price than the

competitors.

4. Distribution Channels

The distribution channel that they use is retail. The owner of the

business has a loyal suppliers in Angeles and Manila (Divisoria). To get

the product with lower price they are the one who will go to the

supplier’s location and because of the long-time connection with the

suppliers they often obtain discounts from them. They will buy it

wholesale and sell them by retail. Retailing is easier because most of

the buyers are students, that’s why the products are affordable as well

since they have lower range of prices than the competitors. The

business is also getting more profit in retail because selling it as a

whole sale, the profit will be lower.

5. Market Trends

The business keep up with the trends in different ways. In every

season and events, the business offer new products that is based on

the current trends. The business is not just focusing into the same
 products over and over again. Example is when it’s summer, of course

it is also vacation for the students so the demand for school supply is

low. The owner will then buy products that suits the season like outfits

or bathing suit for kids and also different kinds of salbabida.In rainy

season, the products will be umbrella and rain coats. The business

also make sure thatthe products are in trends.

B. Customer Analysis

By conducting a survey to the target market, the owners were able to

analyze the nature of their customers. The findings shows that the customers

are mostly students since the main products the business’ offers are school

supplies and sells in retail and even in large portion. The students are mostly

purchasing in a small portion of school supplies. the business also offers

varieties of items such as glasswares, plasticwares, and gadget accessories

that are commonly purchased by the customer ages ranging from 20 years

old and above. It is also revealed that the customers are satisfied with the

quality and affordability of the items they purchased. The business is

profitable since the sales production is fast even in a short period of time

since the business has a great location for its target market.
 C. COMPETITIVE ANALYSIS

1. SWOT Analysis of the Business

STRENGTHS

1. The business owners have a pleasing personality that captivates and give a

warm atmosphere towards their customers. They are also keeping on tabs

with their business that allows them to have control and may share ideas that

will benefit to their business.

2. The business offers affordable and cheap price with a good quality products

than their competitors.

3. The business has a good location because it is accessible to the target

market and to commerce industry.

4. The owners are varying their products according to seasonal trends and open

for a variety of changes to their items to offer what is the in demand of the

market.

WEAKNESSES

1. The business does not have an employee/s other than the owners that may

help in doing such things for the business like sales person, cleaners and etc.

2. There is no signage that shows the store’s name that may help the customers

to easily recognize the store.

3. The business has no definite suppliers for the items they are selling.

4. The business operation is done manually that may resulted in to inaccuracy.

OPPORTUNITIES

1. Renovating/Expanding the location of the business in order to have area for

more items and to have a pleasing business environment.

2. Building a connection or partnership towards schools and offices institution in

order to gain loyal customers.

3. Developing a good relationship towards the community by doing righteous act

such as feeding program, charity and donations.

4. Gradually branching out the business into some area within the local.

THREATS

1. There are several businesses within the vicinity of R.E. Hernandez shop that

offers the same variety of items and consider as a competitor for the

business.

2. Because of having many competitors with the same sort of items, price and

marketing is a competition.

In order to have a positive and successful business, there should be a

solution to every problem that may occur as it regard as a weakness and a big

threat for the business. There are numerous of listed weaknesses that the

business have, and it includes the lacking of the business identity or the

showing of signage, logos and slogan for the business. That is why, the

owners have thought of providing these materials to showcase the business

to the public and gain acknowledgement towards their customers.

As for the threats, the location of the enterprise has a great amount of

commerce and this indicates that the market is very competitive when it
comes to elevating their businesses. In such, the R.E. Hernandez shop would

not let to be out of the competition by increasing its competitiveness in which

promotional tools will be used like advertising, public relations and sales

promotional. This will help the business to gain more customers and become

as an advantage for the business.

Table 3.1 : Competitor’s Analysis

 The table analyzes the local competitors’ capacity in the nature of

competition. Competition in the local area is somewhat sparse because the business

location is just in a small town. Local customers are reaching out for the in nearby

stores that produces their demands with the thought of quality and price of the

product. However, the market is gradually increasing and business competitors are

emerging with the same product line. To have a well-managed business and in able

to keep up with the market, the enterprise listed the possible competitors that may be

interrupt the achieving of business goals.

The results are used to analyse what are the possible opportunity and

strengths to utilize in order to eliminate and solve the problems from the business

weaknesses and threats.

MARKETING OBJECTIVES

A. Objectives related to monetary goals

- To gain 1,000,000 pesos worth of sales within a year

- To Increase revenues by at least 50% before 2020 by December of 2020

B. Objectives related to marketing goals

- To increase the percentage of customers from up to 50% within 1 year

- To expand the market size of 50% by 2020

C. Objectives related to social responsibility

- To Develop its own program aimed at helping communities raise money to

purchase school supplies as donation for elementary students by 2020

- To participate with outreach programs by the end of 2019

III. MARKETING STRATEGIES

1. Target Market

The target market for R.E. Hernandez Merchandise products is

consumers between the ages of 12 and above—students, teachers,

vendors, parents, teenagers, elders, families, and everyone that are

potential buyers.

The active consumers represent a demographic group students;

from elementary to college students. Income from school supplies

range between 100,000 and 150,000 annually. Despite the affordable

products, these consumers are price conscious and consistently seek

value in their purchases regardless of their age.

2. Marketing Mix

PRODUCT STRATEGY. The business currently offers a line of high-

quality items including school supplies, household tools and

equipments, products that are on trend, and plastic wares. The

business is having a seasonal product too like flowers in valentines,

candles in All Souls Day, and Christmas lanterns in Christmas season.

By this year, R.E. Hernandez Merchandise plans to expand the product

line by offering items that are in demand per month.

PRICING STRATEGY. R.E. Hernandez Merchandise products are

priced with the competition in mind. The business is not concerned

with setting high prices to signal luxury or prestige, nor is attempting to

achieve the goals of offsetting low prices by selling high quantities of

products. Instead value pricing is practiced so that customers feel

comfortable purchasing the products.

PLACE STRATEGY. The business is located at Bangcu, Dapdap,

Bamban, Tarlac. The place is located in the market which makes it

more accessible to the customers. There are also number of schools

near the area of the business that is why most of the buyers are

students and school supplies are always in demand.

PROMOTIONAL STRATEGY R.E Hernandez Merchandise

communicates with consumers and retailers about its products in a

variety of ways. Information about the business is available via sales

promotion and personal selling. The business’ promotional efforts also

seek to differentiate its products from those of its competitors.

The company relies on personal contact with buyers to promote the

products which aims to create long term relationship with customers.

The R. E Hernandez offers high-quality products with affordable price

that attracts customers. Other than the affordable price, they make

their customer comfortable with them to have the assurance of them

coming back.

As the business expands, it will adjust to meet greater demand

by creating the business’ own logo that will create a greater image of

the business. Sales promotions and public relations currently make up

business’ promotional strategy. Because the business also engages in

cause marketing through its contribution to outreach programs, good

public relations have followed.

IV. MARKETING IMPLEMENTATION

A. ACTIVITIES, RESPONSIBILITIES AND TIMETABLES FOR

COMPLETION

Table 5.1: ACTIVITIES, RESPONSIBILITIES AND TIMETABLES FOR

COMPLETION
 B. BUDGET AND PERFORMANCE MEASURES

In every business there is what you call inventory. They doing it to see

the cash flow of the business. In the world of business, it is important to have

budgeting or the total expenses that the business is consuming to know if they

are gaining profit or they are getting loss. The business owner is monitoring

the expenses every month by listing it all.

MONTHLY EXPENSES COST

Sales Expense

 School Supplies P80,000 – P100,000

 Plastic Wares

Utilities Expenses

 Electric Bill P700-P1000

 Water Bill

Transportation Expenses
P2,000
 Gas

Depreciation Expense
P3,000
 Xerox machine Materials

Tax and Professional Fee Expense P1,000

C. EVALUATION AND CONTROL

A. Evaluating the Marketing Plan Execution

This part contains the evaluation of performance and the flow of the marketing

plan on the business. It’s consists of the process of how the business record
 and evaluate all the positive and negative outcome of the plan. It helps to

ensure the entrepreneurs that the plan is going well or not.

 Recording all the outflows and inflows.

 Doing inventory for the stocks.

 Receiving or accepting feedbacks and recommendations.

 Analysing competitor’s moves or strategies.

 Monitoring the improvements of the business

B. Controlling of the Business according to the Marketing Plan.

This part consists of strategies in how the owner control the business

according to the plan. The advantage of having the proper techniques in

controlling the business is to execute the plan in a logical manner.

 Having timetable or the step-by-step process of the plan per day.

 Budgeting and monitoring the expenses of the business.

 Following the Marketing Plan properly.

 Offering seasonal product according to the plan.

 VIII. APPENDICES

A. INTERVIEW TO THE BUSINESS OWNER

Table 8.1: Questionnaires

LIST OF QUESTIONS

1 For how long is your business operates?

2 How did you get the idea or concept for your business?

3 What products do your business offers?

4 What are the promotional tools you used in promoting your business?

5 What made you choose this type of business?

6 Do you think you choose the best location for your business?

7 What are the marketing strategies you use for your business?

8 What is your current market size?

a. What is your estimated no. of customers every day?

b. What is your target no. of customers in the future?

9 What is the growth rate of your business as of the moment?

a. What is your projected increase for every year?

10 What is your estimated sales daily?

a. What are the products that are mostly purchased by the customers?

b. Do you get your target sales daily?

11 What are your existing or current distribution channels?

a. Why did you choose that distribution channels

12 How does your business keep up with the trends?

What are the strengths, weaknesses, opportunities and threats of your

13 business?
 B. CUSTOMERS’ SURVEY QUESTIONNAIRES

Marketing Plan for

R.E. Hernandez Merchandise
Survey for Customers

Name: ___________________________________________________________
Age: _____________________________________________________________
Address: _________________________________________________________

1. Do you often buy at R.E. Hernandez Merchandise?

__________________________________________________________
2. What item you usually buy? (pls. specify)
__________________________________________________ 1 2 3 4 5
________
3. How can we improve the business? 1 2 3 4 5
__________________________________________________
________ 1 2 3 4 5

1 2 3 4 5
Check whether: 1=not, 2= slightly, 3= moderate, 4= very, 5=
extremely

4. How satisfied were you with the service and product?

5. How likely are you to recommend the company to a friend?

6. How friendly were the employees?

7. How affordable is the price of their product?

C. GALLERY

R.E. Hernandez Shop, located at

Brgy. Bangcu, Dapdap, Bamban
Interviewing Mrs. Hernandez about
their business. Interviewed by Johanna
S.
Overview of some of the products the
business’ offer