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University of Makati J.P. Rizal ext.

West Rembo, City of Makati

The effectiveness of the layout and design of Mercury Drug, Guadalupe branch, City of Makati as perceived by the customers, year 2012.

Submitted by: Casil, Rosette D. Cabubas, Arminggol R. III Gutierrez, Ronnie A. Macato, Jamielyn O. Malabana, Janina Mae P. Villanueva, Claire M.
(IV-AMA)

Prof. Arthur Alvarez


February 6, 2012

STATEMENT OF THE PROBLEM The main inquiry of the study is to determine the effectiveness of the layout and design of Mercury Drug, Guadalupe branch, City of Makati as perceived by the customers, year 2012. Specifically, this study sought answers to the following questions:
1. Demographic profile of the respondents in terms of age, gender and civil status.

2. How satisfied the customers are, with the present layout of the Mercury Drug? 3. Does the layout of its safekeeping of medicines ensures that the medicine will not spoil easily? 4. What possible solutions may be offered to the company to help solve the problems encountered by the customers?

OBJECTIVES This study seeks to attain the following goals: 1. To find out how effective the present layout of mercury drug is, to its customers. 2. To know how effectively the mercury drug store utilizes its space productivity and its influence in the customer purchasing decision. 3. To study other factors aside from store layout and design that would prompt potential customers to buy from the store.

4. To give possible solutions for improvement of the companys layout and designs.

COMPANY BACKGROUND Mercury Drug Corporation is the Philippines' dominant pharmacy group. The company began with a single store owned by Mariano Que. He named it after Mercury, the messenger of the gods in Roman mythology and whose staff, thecaduceus, is sometimes used as a symbol of medicine. It began on February 1945 when most of the businesses were destroyed. Shortly after the liberation of Manila zfrom Japanese occupation, Mariano Que, realizing the need of the people for medicines, bought with his hard earned savings of P100 a bottle of 1000 tablets of Sulfathiazole and sold it patingi-tingi(piece by piece) for P1.00 per tablet in the sidewalks of Bambang, Manila to those who could not afford to buy a whole bottle of medicine. Sulfathiazole is a wonder drug that cures all during that time. He started Mercury Drug by selling medicines from a pushcart and from the pushcart to the opening of the first small drugstore in Bambang on March 1, 1945, Mercury Drug has grown into a network of over 700 company-owned and franchised stores all over the country. Realizing that not everyone could go to the drugstore, Mercury Drug introduced the first motorized customer delivery service in 1948. Four years later, it commenced the 17-hour, 7 days a week drugstore service. In 1963, upon the invitation of Ayala Corporation, Mercury Drug opened its second branch in May 1963 at a developing commercial center in Makati (now known as the Ayala Center). It also commenced the

countrys first self-service drugstore. In 1965, it commenced the 24-hour, 7 days a week service; in 1967, the first computerized temperature-controlled central warehouse; in 1969, the first drugstore chain to use biological refrigerators to preserve life-saving medicines and in 1976, the first drugstore chain to expand throughout Luzon, Visayas and Mindanao. In the year 1970, the company acquires Medical Center Drug Corporation (MCDC). In 1972, Mercury Group of Companies, Inc. is set up as a holding company for MCDC and Mercury Drug. During 1976, Mercury begins expanding beyond the Manila market. In 1985, the company sets up fully computerized warehousing, inventory, and ordering systems. Mercury Drug makes certain the availability of less common but life-saving medical products such as serum, blood plasma, albumin and the like that are stored in a Bio-refrigerator. This would require Mercury Drug to invest on modern technology and to continuously upgrade its facilities in its head office, stores and distribution centers. Aside from pharmaceutical products, it now carries basic household necessities such as food, health and personal care products and others for the buying convenience of its customers. As a drugstore with a heart, Mercury Drug has been conducting Operation Bigay Lunas every March 1, on their anniversary day together with its business associates. For the past decade, this annual and all-day free clinic catering to the less-privileged provides medical consultations and free medicines to indigent patients in selected cities and municipalities nationwide.

In 2002, Mercury Drug, in partnership with the Philippine Business for Social Progress (PBSP), has launched a program that has been helping rural and urban marginalized communities nationwide to have access to potable water system within their communities through the Artesian Well Project. The installation of this potable water system helped improved the quality of life of the beneficiaries by promoting better health and sanitation practices. As of the year 2004, Mercury operates more than 450 stores. The company also remained one of the Philippines' largest corporations, ranking in eighth place among the country's largest corporations and third place among the corporations in the high-quality services/products bracket. Mercury Drug appeared to have discovered its own "miracle drug" for success. In the years to come, Mercury Drug will keep on looking for opportunities to further enable customers to have more access to quality, safe and life-saving medicines, thus enabling them to have more meaningful, healthier and longer lives. It will always pursue its commitment to better and further serve its customers whose trust and loyal patronage has allowed Mercury Drug to be of continued service to the nation.

ALTERNATIVE COURSES OF ACTION In view of the foregoing discussion, the company can choose from various alternatives in order to resolve their problem. These may include rearranging or restructuring their current facility in order to accomodate their customer in a comportable manner. Rearranging their current facility may involve a cash outflow, but this cash outflow may not be so material. In turn, rearranging their current facility may attract more customer because they will see that it is now comportable or more

convenience to go inside and buy medicine. This may result in additional sales on the part of the company, and additional sales means additional income. Moreover, rearranging their current facility may enable them to store their medicines in good condition. Second, Since there are vacant lots in Guadalupe which are being used as parking for vehicles, they might as well enter into a lease contract and put up another store on that site. Compared to the first alternative, this will mean higher cost. This cost will include the cost of the lease contract and the cost of the new store to be built. But, unlike the first alternative, putting up a new store in Guadalupe may generate more sales. If you put up another store, your saves, as well as your income may double. Third, since there are also vacancies in Guadalupe mall, they might as well put up a store there. Of course, compared to the first alternative, this will cost higher, but compared to the second alternative, the cost that you will be needing for this alternative

might be smaller. In terms of the sales and income that may be derived from this alternative, it may be the same with that of the second alternative. If you put up a store inside the guadamall, more people will choose to buy there because the sorrounding, as well as the outside of the store is comportable because the mall is airconditioned. On the other hand, putting up a store inside a mall will mean that you cannot open your store at a 24 hours basis because the malls normally closes at 10 PM. But the amount of sales that you might have been realized if you can open your store at night, compared to that of opening it in the morning is immaterial.

CONCLUSION On the basis of the significant findings of the study, the following conclusions were reached: That the present Lay-out and Design of the Mercury Drugs Store at Guadalupe Branch though has changed, still not good enough to facilitate its area and serve its customers more convenient, because many customers are still waiting for too long before they can buy a medicine especially during peak hours which are normally during weekday evenings. That the services they rendered are not good enough to provide their customers satisfaction and convenience. They cannot also accomodate all their customers at the same time because of shortage of manpower.

Lastly, they dont have a sufficient waiting space for their customers as well as sufficient space for storage of medicines to ensure that it will not spoil easily. We found out that most of the identified customer problems could be solved by

improving store operations. They should design store environments that reduce the expected purchasing difficulties of customers. They should also understand the psychology of waiting and implement measures to better manage the waiting time of

customers on the queue. Improvements in the general store environment are also necessary, specially the store layout and desisgn. If retailers can bring customers to their stores through their marketing efforts, they should make them happy and provide a delightful experience inside the store. After all, marketing has invited them inside the store, so customers ought to be treated like guests. They should also provide sufficient and properly ventilated waiting space inside the store for their customers as well as sufficient space for storage purposes to ensure that their medicines are kept in proper place. Sufficient number of wooden or steel racks should also be arranged for storage of drugs to make it more convenience for the pharmacist to get the medicine for their customers. They should also hire additional well trained- staff or employees easily accessible to customers to to make their services fast and t hey should utilize the space they have in the most efficient manner for them to display as many goods as possible, avoid shrinkage and stimulate customers to make purchases. The study emphasizes that on the proposed solutions for the problems will benefit both the customers and the company to make their relationship as a buyer and seller more harmonious. As well as improving the store lay-out and design may give higher income on the part of the company. We all know that businesses are built first, for the companys profit and second for the customers to be well served and given importance.

RECOMMENDATION In the light of the salient findings and conclusion of the study, the following recommendations were offered: First, our proposal of action would be the first alternative which is debt restructuring. Among the three alternatives, it is more convenient and fascinating. The cost of the restructuring compared to second and third alternatives have lesser costing and more realistic. Restructuring the whole building will make the new branch accessible to the customer and also to the products which is very sensitive to the heat. For the better understanding of the proposed plan, we have indicated the blueprint of our design. Restructuring the branch would cost a lot on the management however, this restructuring will make the branch in as much as the company more convenient to customer needs and the effectiveness of its service will be surely be obtained. The researcher also recommend the following: They should provide an L Shapes counter made from wood or glass and

at properly maintained with decorative material and also instructions if any. It is

much better if they will provide additional counters to minimize too long lines of customers, especially during peak hours. They should also have a checkout register in the pharmacy section to

make the purchase more convenient for the customer. Provide sufficient parking place near to store so that the cars of their

customers will not block the main entrance of the store. They should maintain dust free environment using glass paneling and

proper transparent gate with door closure to attract more customers. They should also improve their store arrangement, so that their customers

will be able to go inside, and personally look for the items that they will buy. Still, medicines should be separated from groceries and not open to customers like what the other branches had. The above-mentioned recommendations, if implemented, will help to improve the layout and design of the Mercury Drug store, Guadalupe branch as well as the services rendered by its employees to their valuable customers. It will also provide both convenience for its employees as well as to its customers.

LAYOUT PROPOSAL Store Layout

Parking layout