CHAPTER I

THE PROBLEM AND ITS SETTING

BACKGROUND OF THE STUDY

There are two kind of buying behavior, the one who buys the bigger or bulk
product and the one who buys the break bulk or sachet type of products. Sachet
smaller type or Break Bulk, which is commonly called Tingi, the micro form of an
existing product offered to the market for a lower price. Sachet type of product
continues to be immensely popular in the Filipino consumers. While, the Bottle Bigger
type, is a large portion, great size or big volume, rigid container of a product offered to
the market. Filipino consumers are vulnerable and aware of difficult times ahead.
Sachets and other small pack sizes' lower cash outlay allow them to do so.
There are several brands out there and a wide variety of items per brand that vie
for the consumer attention and money. With tons of option available to consumers,
shopping has become easy and convenient which brings us to the affordable and evenso-dependable Tingi or Break Bulk.
Sachets strongly appeal to the bottom of the pyramid market. But the Filipino
consumers are still patronizing smaller packaged products and a sachet has bloated the
shopping trips of Filipinos. When Filipinos shop, the amount of money they have to shell
out is still a very important factor.
Filipino Consumers look for cheaper options and prioritize buying the things
needed the most. Its not all about price, though, determining on the price basis or the
loyalty of a certain products is concerned in the purchasing power of a Filipino
consumer. Filipinos remain highly concerned about health. They care about how they
look and place importance on time. The purchase of health and convenience products

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like milk powder, yogurt drinks, soymilk, oatmeal, ready-to-drink tea, liquid soap, and
bleach and hair conditioner is growing. Cheaper local brands are on the rise. Product
category leaders, a lot of which are multinational names, feel the growing presence of
these emerging brands.
More important is to find out the reasons behind consumers' purchasing power. Is
it because of their Income? Convenience? Quantity? Quality.
RESEARCH PROBLEM AND OBJECTIVES
The objective of this research is to determine the effectiveness of break bulk on
selected products in affecting the buying preference of the Filipino consumers and to
answer the following questions:
It aims to answer the following specific problems:
A.) What is the demographic profile in terms of:
a.1 Age
a.2 Gender
a.3 Education/Occupation
a.4 Income/Allowances
B.) What are the factors considered by the consumers in buying sachet type and
bottle type of products in terms of:
b.1 Convenience
b.2 Packaging
b.3 Price Value
b.4 Quality value
b.5 Usage Control

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C.) How do the respondents compare the sachet type and bottled type of
products in terms of:
c.1 Advertisement & Promotion
c.2 Convenience
c.3 Packaging
c.4 Price Value
D.) What selling style the does the respondents prefer between Sachet and
Bottled type of products in terms of:
d.1 Advertisement
d.2 Affordability
d.3 Packaging
d.4 Price Value
d.5 Usage Control
E.) How effective is break bulk to the consumer?
F.) Why do Consumers patronize break bulk products?

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HYPOTHESIS
In line with the topic and its objectives, the researchers came up with a Null
Hypothesis.
Null Hypothesis
Break Bulk Tingi on selected products has no significance to persuade the
consumers on their buying preference.

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CONCEPTUAL FRAMEWORK

Figure 1.Conceptual Framework

The flow of the research is based on the conceptual framework illustrated above. It
shows that the study will utilize the effectiveness of break bulk as its input for
determining the intervening variables which are the demographic profile of customers,
determinants considered by the consumers, comparison of break bulk and bigger retail
products and respondents preferred retailing style in order distinguish the effects in the
purchasing power of consumers in their buying behavior or preference.

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SIGNIFICANCE OF THE STUDY

The primary purpose of the study is to determine the new trend affecting the
purchasing power of consumer in their buying behaviour or preference. The purpose of
this research is to conduct an analysis on the effective trend in persuading the
consumers on their buying preference. Based on the possible results that the
researchers may attain, this study may benefit the following:

Consumers- the study will help the consumers know the difference between bulk and
sachet products. It will also help them decide on the products that they
may purchase.
Entrepreneurs- the study will help the entrepreneurs to gain insight about consumers
wants, needs and perception in terms of quality, price and
convenience.
Researchers the study can serve as a guide and reference to other future
researches and inquiries in relation to the retailing business in the
Philippines.

SCOPE AND LIMITATIONS OF THE STUDY

This research intends to analyze the behavior of a consumer through their buying
behavior.

It will show how the Filipino purchases products and how much they

patronize the break bulk tingi (sachet) on selected products. The study is
geographically placed at: Puregold Paco, Ultramega in Divisoria, San Roque in Tondo,
and Robinsons Manila Supermarket; where we can see how the Filipinos purchases
goods or services. Specifically under the buying category which can assist in providing
solutions to the study.

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In order to attain the goals of this study, the researchers will conduct a survey
targeting the people surrounding the market area. The respondents are mainly the
person who comes in and out of the grocery or supermarket, specifically the buyer who
directly use and consume the product or the consumers.
In order to clarify the survey questions, we made a basis for easy understanding.
We use the term break bulk (sachet) for products that contain
The researchers will conduct different types of statistical methods that will
provide the answers to the problems.
The researchers chose this type of respondents because these people are the
ones who are mainly involved with the study. The target schedule for the survey as well
as the interview will be on January 2016.

DEFINITION OF TERMS
1. Advertising - The activity of attracting public attention to a product or business, as
a product or business, as by paid announcements in the print, broadcast, or
electronic media.
2. Buying Behavior - the decision processes and acts of people involved in buying
and using products.
3. Bottle type is a rigid container of a product offered to the market. A large portion,
4.
5.
6.
7.

great size or big volume or commonly called Bulk Products.

Break Bulk - a term used for products that is individually loaded.
Convenience - the availability of the product everywhere.
Consumer - A person who purchases goods and services for personal use.
Determinant - an element that identifies or determine the nature of a competition or

conditions an outcome.
8. Filipino Consumers - consumers that are resident of the Philippines and/or has a
Filipino blood.
9. Meager Income - having a small amount of money. Having a little income.
10. Price - is the amount of money you pay for the cost of a product.
11. Promotion - refers to raising customer awareness of a product or brand, generating

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sales, and creating brand loyalty.

12. Purchasing Power - is the extent to which a person has available funds to
purchase. It may be in the form of money and/or credit
available for spending and consumption of goods and services.
13. Quality- the ability to satisfy and fulfil the customer's needs and expectations.
14. Respondents - a person who gives a response or an answer to a question that is
asked especially as a part of a survey.
15. Sachet type - the micro form of an existing product offered to the market for a lower
price.
16. Significance the quality of having notable worth or influence
17. Trend- is currently popular product in the market.
18. Vie- to compete with others in an attempt to get or win something

CHAPTER II
REVIEW OF RELATED LITERATURE AND STUDY

RELATED LITERATURE
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This chapter presents the related literature after the thorough and in-depth
search done by the researchers. This will also present the synthesis of the theoretical
and conceptual framework to fully understand this research.
The proponent indicates to this study why the Filipino Consumer patronizes
break bulk or sachet type of products.
According in the newspaper Philippine Star for the Filipinos, the amount of
money they have to shell out is still a very important factor. Ninety-two percent plans
their shopping in advance and 79 percent prepare a shopping list before hitting the
supermarkets or any place they want to do their shopping. They look for cheaper
options and prioritize buying the basics: 73 percent allot time to look for the best
promotions, and even if 89 percent decide what brand to buy before shopping, 81
percent end up choosing the brand to put in their baskets at the point of purchase, and
74 percent are willing to try a new product. In addition, cheaper local brands are on the
rise like laundry detergent, toothpaste, coffee, tea, and instant noodles are some
examples.
Moreover, in Thinking Small article said that, Sachets and break-bulks,
commonly called tingi, continue to be immensely popular among Filipino consumers,
manifested in their purchase of top FMCG. Their lower per capita income compared to
their Asian neighbors accounts for the dominance of tingi selling in the country. To most
Filipinos, the smaller the cash outlay per shopping trip, the better. This is their mantra
for most products used on a daily basis. Indeed, Big Is Out And Small Is In.
Patronizing smaller packaged products and sachets has bloated the shopping trips of
Filipinos. In a year, for example, weekly shopping trips for shampoo have reached 33

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times compared to every six weeks in other Asian countries. They usually buy from a
mom-and-pop outlet or the neighbourhood sari-sari store, the major beneficiary of the
sachet phenomenon. It is visited almost every day, allowing easy-on-the-pocket
buying. Sachets strongly appeal to the bottom of the pyramid market the class D
and E households, which comprise the biggest demographic chunk of Filipino
households at 90 percent versus the upper- and middle-income households at 10
percent. There is indeed increased spending seen among low-income homes, but take
note that class E spending remains only a fraction of class A-B spending. Shoppers in
the NCR predominantly go to supermarkets, while the rest of the Philippines continue to
rely on sari-sari stores. They spend wisely, give priority to necessities and scrimp on the
nice to haves. They stretch usage, look for more affordable alternatives, and keep the
most important and trusted brand.
According to the article of Casa Veneracion entitled Filipino shopping Habits and
Tingi Culture, the answer in what is behind the practice of buying break bulk products,
is that the average income is low and majority of the people have to budget carefully.
While it may be cheaper in the long run to buy in bulk, but it does not work with many
people. It is more realistic for them to buy only what they need for the moment. The
proper word for this practice is Immediacy. The irony is that the tingi packaging raises
the price of the goods by as much as a hundred percent, while the lower-priced small
package may be more affordable for the masses. In effect, more Filipinos are paying so
much more.

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It may be financially unwise to buy a sachet of shampoo everyday versus buying

a bottle of shampoo for much longer use and cheaper cost in the long run, but most
people only live on what they can afford each day. What beneficial is with this style of
buying you can get only what you intend to use or limit your usage because you have
only a little. In some ways, people get to save money by not wasting away quantities
they dont need. In the Philippines where everything must come small, this tingi culture
definitely is one tactic to survive each day. Apol Danganan said in Vagabond Journey
article entitled, The Philippine Culture of Tingi.
In the Iloilo Metropolitan Times newspaper by April Dream Teodosio, economic
Professor at West Visayas State University. She said that the prevailing tingi (mini)
economy in the country is a manifestation of the current level of poverty experienced by
most Filipinos, tingi-tingi a colloquial term in repacking products into sachets, has been
long practiced in the Philippines. Teodosio said that the Filipinos are buying in tingi
because of the following: (1) lack of availability and (2) consumers lived on a day-to-day
basis.
In fact, the 2013 Kantar Media Advertising Expenditure Report showed that top
advertisers are mostly engaged producing products in sachets. Kantar Media General
Manager Gabriel Buluran quoted that For Unilever, the Philippines is a best practice for
the sachet marketing, wherein exported such idea to India, Indonesia and Vietnam and
it boosted sales as well in those areas. Most consumers of tingi products, in a

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Philippine Center Invertigative Journalism (PCIJ) report from D and E classes citing the
AC Neilsen study, PCIJ said that Consumers A and B classes prefer wide product
assortment, the D and E would buy on needs basis, mostly small-size packs. For the
supermarkets alone, data show that the D and E segments account for more than 61
billion in estimated sales annually while the A and B classes contribute only about 5
billion. Sachets and products in smaller packages enjoy wider reach in rural areas than
in urban areas, says AC Nielsen. In a separate by the market research arm global
communications specialist Aegis Group PLC, sixty-three (63%) percent of the
respondents bought items in tingi, with the D and E segments making up the majority.
Of those who live by tingi, 17% said they bought non-food items while 94% said they
bought food, primarily cooking oil, soy sauce, vinegar, salt and sugar. In the question
which is more economical?, Teodosios answer is, If you are businessman-with enough
capital its better to go for wholesale because it has a volume discount so that you can
gain profit, but if youre a consumer, buying of break bulk is better because you can
spend your money little by little.
Nearly 90 percent of Filipinos, most of them from the D and E classes, now buy
products in sachets and mini-sizes. According to the Global Omnibus Survey of
Synovate, a marketing research firm, many among those who belong to the A, B, and C
classes have turned to mini-sizes. Coffee, creamer, juice, chocolate and milk powder,
soy sauce, and vinegar topped the list of the 30 percent in those segments who said
they bought food items in smaller.

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Synovates data show that for the A, B, and C classes, one of the main reasons
for buying single-serves or mini-sizes is that usage is controlled (they also liked the
packets handy size that make them easy to carry around).
Based on the newspaper The Philippine Star, Lifestyle section, the top categories
that Filipinos spend on are milk products, snacks, fabric cleaning, food seasoning,
coffee, canned goods, noodles and hair care products. Household care and frozen
foods make up the urban homes top 10 categories. Cooking oil and soft drink complete
the rural consumers top 10 list. Milk products are on top for both homes, with each
urban home spending 1,400 on the category for the quarter, while each rural home
disbursed 900. Baby care items; snacks/biscuits and alcoholic beverages also ranked
high in the spend per buyer figures. Rural homes are predisposed to spending more
on seasonings and sauces. Sachet marketing continues to rule. In terms of the number
of trips to buy goods, snacks and seasonings topped list followed by coffee, hair care,
fabric conditioners and noodles. This data is a continuing testament to the success of
sachet marketing or the tingi mentally in the country, where Filipino consumers do
more trips, purchasing goods at lesser and more affordable volumes per trip: 26 to 31
trips to buy biscuits, 22 to 28 trips to buy seasonings, and 20 trips in three months to
buy coffee. The frequency of visits presents a lot of opportunity to see and try what is
new on market. Its a test of consumer loyalty.
In Philippine Center for Investigative Journalism, Abad says that downsizing not
only allows the D and E classes to buy what they need at the moment, it also offers the

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average consumer variety and a chance to get to know the product. Or as Macapagal
says, How can you fall in love with a product if you havent tried it?
For the supermarkets alone, data show that the D and E segments account for
more than P61 billion in estimated sales annually while the A and B classes contribute
only about P5 billion. Sachets and products in smaller packages enjoy wider reach in
rural areas than in urban areas, says AC Nielsen.
Overall, shampoo, detergent, soap, and toothpaste remain the top (and growing)
items in the nonfood category, according to TNS. These products, apart from being the
most basic necessities of a consumer, all happen to come in sachets or smaller packs.
Even fabric softeners are now fast becoming sachet-driven, says TNS account
executive Omar Carlos.
The number-one reason for purchasing downsized items is consumers cite price,
yet while convenience has certainly been one of the come-ons of buying in sachets. And
its not only because they just a few pesos to spare. Filipinos actually end up saving
when they buy items in sachets versus goods in plastic or glass bottles. Its the exact
opposite of what is happening in the United States, where the consumer market has
grown bulk-obsessed and gone for super-sized products in part because they believe
they save money in doing so.
If we compare which is cheaper, buying product in bulk (big packaging) like
bottle, box and can, or buying in break bulk (sachet)? The answer is, you cannot always
say that all products in break bulk are more cheaper than in bulk or vice versa. Its

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because, companies base their product price in production expenses including the
packaging expense. In short, less packaging expense result to less cost of price. In fact,
production-wise, sachets are 10 to 20 percent cheaper than other types of packaging
because they consume less packaging material, explain by Christophe Joyeux,
development manager for Unilever Philippines. The selling price correspondingly goes
down. At Unilever, for example, the suggested retail price of a 100-ml bottle of shampoo
is P48. A 10-ml sachet of shampoo costs P3.15, which means 10 sachets, equivalent to
100 ml, will total only P31.50.When you buy a sachet, you pay less packaging material
than when you buy a bottle. Consumers pay for the product, not the packaging. And
thats what makes it (sacheting) a success; its low cash outlay, Joyeux says. The same
holds true for some food items, although the savings arent as much as in nonfood
goods in sachets. For instance, a consumer would pay just P1.75 more when he buys a
385-ml bottle of Silver Swan Soy Sauce instead of purchasing several smaller plastic
pouches equivalent to the same amount of toyo. And in some cases, its cheaper to buy
food in bigger cans and boxes than in sachets. Buying a 500-gram tin of Milo chocolate
powder, for example, would result in savings of P10 compared to buying the same
amount in 80-gram sachets.
Sociologist Arnel de Guzman, however, has another theory about the sachet
mania in this country. On the surface its an economic necessity; the poor cannot buy in
bulk, he says. One possible explanation is the smallness mentality was in still on mind
of Filipinos. This is everyday culture, its a lifestyle and we cannot get out of the nearsightedness and smallness.

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CHAPTER III
RESEARCH METHODOLOGY

RESEARCH DESIGN
This chapter describes the research method used to determine the effectiveness
of break bulk on selected products in affecting the buying preference of the Filipino
consumers. The study utilized a multi-method approach with analysis of both qualitative
and quantitative research data. It specifically used a descriptive research design.
The research design which will be used in this study is the descriptive type of
research. The descriptive research is conclusive in nature, as opposed to exploratory.
This means that descriptive research gathers quantifiable information that can be used
for statistical inference on your target audience through data analysis. This type of
research takes the form of closed-ended questions, which limits its ability to provide
unique insights. However, used properly it can help an organization better define and
measure the significance of something about a group of respondents and the population
they represent. The purpose of applying this type of research is to be able to gather
relative information by the collection of data that will provide and uncover facts about
the study.

Research Instrument and Procedure

In order to collect data that will support the study, the researchers will need
research instruments in order to obtain the specific problems which were derived from
the conceptual framework. The research instruments will serve as a guide in providing
the solutions to the problems. An instrument is a tool designed to measure knowledge
attitude and skills.

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Survey Questionnaire
Several research instruments will be used in gathering information related to the

research. The researchers will use Survey Questionnaires in order to gather data,
analyze and interpret the views of a group of people from a target population specifically
in City of Manila like Puregold Paco, Ultramega in Divisoria, San Roque in Tondo, and
Robinsons Supermarket. It is obtaining data to the people who have different
experiences and beliefs that prevent information bias and thus increasing the credibility
regarding the information.
The questionnaire will be consisting of a number of items that can help to answer
the problem of the study and meet the objectives. It helps to keep the confidentiality of
information and to avoid the interviewer bias. In administering the questionnaire, the
researcher will give an allotted time to answer. The respondents of the survey
questionnaire are the customers of the different supermarkets in City of Manila like
Puregold Paco, Ultramega in Divisoria, San Roque in Tondo, and Robinsons
Supermarket.
The Administrative Survey Technique will be applied in order to avoid the
collection of duplicate information, to maximize the participation rates of respondents.
The researchers will ensure the security and confidentiality gathered from the
respondents.
The statistical approach which will be applied in the study is frequency method
also known as the percentage method. This method is used to determine the relative
frequency of survey responses and other data. In order to tabulate the results of the
survey, such method is the applicable one for the analysis of data gathered. The
weighted mean will also be used to get the average. The formula for the weighted mean
is:

(x)=

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X 1+ X 2+ X 3+ X 4+ X 5 +Xn
n

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Where:
X= weighted mean
Xn= frequency
n= number of terms

A. Research Instrument
The researchers used the customers of grocery stores within the city of Manila
like Puregold Paco, Ultramega in Divisoria, San Roque in Tondo, Robinsons Manila
Supermarket das its respondents, their perception will become the basis in determining
the effectiveness of break bulk on selected products in affecting the buying preference
of the Filipino consumers. The researchers will be using a Survey Questionnaire for the
respondents. Moreover, the researchers will also use a descriptive statistical approach
and other sources to acquire facts such primary and secondary data that would support
the study further.
B. Research Procedure
The researchers will conduct an administered survey questionnaire. They will be
distributing questionnaires to the selected respondents and let them answer on the
same day. The answered questionnaires will be collected and tallied to obtain
perception of the respondents as they determine the effectiveness of break bulk on
selected products in affecting the buying preference of the Filipino consumers.

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