Kim Manuel S.

Tenerife
METHRES

MARKET ANALYSIS
A.

MICROENVIRONMENT:

COMPANY
Bo's Coffee envisions itself to be the premier specialty coffee bar in the Philippines,
roasting high quality Philippine origin coffee beans, serving world class coffee beverages
and the most delectable selection of cakes and pastries, delivering an excellent branded
customer service in a friendly and cozy ambiance.

SUPPLIERS
Bos Coffee gets its coffee beans from Bukidnon, Benguet and some are imported from
Antigua, Guatemala, Columbia and Italy. In fact 90 percent of Bos coffee beans are locally
sourced from coffee plantations in Bukidnon, Cordilllera, Benguet, Sultan Kudarat and
Mountain Provinces(Dagooc, 2006). The beans are mainly demanded by Bos include
Arabica, Robusta and kopi luwak.
Other raw materials such as milk, syrups and pastries are purchased in Cagayan de Oro
City but beans suppliers are chosen by the main center that dictates every franchise.
The Kape Umali company is also another supplier that has 200/ha fams of Arabica with
contributory farms of over 300 hectars found Benguet, Kalinga and Mt. Province with an
average of 60 tons per year(Kape Umali Coffee Company).

MARKETING INTERMEDIARIES
BOs purchase local coffee beans in the provinces of in Bukidnon, Cordilllera, Benguet,
Sultan Kudarat and Mountain Provinces. In an interview with Ms. Fe Serna, store coach of
Bos Velez Franchise, Cagayan de Oro City she said that BOs are open to potential
suppliers and no long term contract of suppliers is done by the company to the bean
suppliers. BOs main company or Coffee Central ( the one who orders the beans) purchases
beans from different farms in the listed regions which include plantations in Bukidnon and
Cordillera that might depend on the capacity of the farms to supply the quantity needed by
Bos operation at the specific time of order.
Benitez said newly roasted beans have to be shipped to the outlets within three days and
must be consumed in two to three weeks to ensure the freshness of the beans, otherwise
non-consumed items are immediately disposed. As proof, he said, the roasted date is
displayed in every Bos coffee bag (Cebus Bo Coffee Shop to Expand Nationwide, 2007).
Bos coffee club in Velez is considered as a customer to the retailer, Triangle Fort
Distribution Inc. The coffee shop of BOs in Velez according to the store coach orders two
boxes per cycle, 32packs per box(500g) that has dated expiration date upon
delivery(6months) to Triangle Fort Distribution Inc.
The manager of the shop orders it through fax and Triangle Fort Distribution Inc. would
supply beans in time as according to Bos freshness standard. Delivery is through Trans
Asia shipping and an employee is task to get the supply from Pier port delivering it in the
shop through a motor cycle. If in emergency the delivery is through Pacific Airline. Every
shipment cost would run to P800. In a month an estimated of 2 cycles of the packs are
ordered and the coach usually orders 2 times per month. The shop is also a retailer in itself
sine it sells espresso coffee packs to its customers. These packs are displayed in the
counter.

COMPETITORS
As already for shadowed, Starbucks has the most known corporate image among the four
competitors. This however does not necessarily mean that Starbucks have a completely
positive corporation image. Although Starbucks have had campaigns such as its effort to
encourage consumers to recycle by giving a 10-cent discount for customers bringing their

own reusable cup and uses of cup sleeves made from 60% post consumer recycled fiber,
Starbucks has been consistently labeled as a symbol of Americas modern colonialism.
While Starbucks is known as an American brand, Figaro as Italian, Coffeeworks and Bos
Coffee are Filipino brands. They are both praised for patronizing local bean growers. In fact,
consumers often praise their support for local farmers saying that it is good that there are
companies that give back to the people.
There are few shops offering coffee drink products. Coffeeworks, BOs, Figaro and starbucks
are the major players in the coffee shop industry in the city and minor players include caf,
quick service and fast food restaurants, convenience stores, donut shops and fastfoods.
These major players play as oligopolies base on high barriers to entry, price control and
interdependence between the other firms actions or decisions and are different based on
the origin of the coffee shop.

PUBLICS
Bos Coffees first selling trait is its focus on the Filipino brand. It features a distinctively
Filipino taste and its stores have Filipino interior. This is one of the reasons why its most
appealing to local consumers who appreciate the comfort and familiarity of the Filipino
brand. Its location is also an advantage compared to other competitors because of its
convenient and easy to find location, it being one of the closest coffee shops.
Bos company is a customer of Benguet Arabica. RMACC is a subsidiary of the International
Rocky Mountain Caf Company is a leading Arabica coffee producer and supplier of office
coffee services in the Philippines (Rocky Mountain Cafe Company, 2011). Today, this
company is working with the government in revitalizing the Philippine coffee industry. It
operates in Tuba, BenguetMiarayon, Talakag, and Sil-ipon, Libona, both at the foothills of
Mt. Kitanglad in Bukidnon; Kiamba, Sarangani; and soon in Camp John Hay in the heart of
Baguio City. RMACC also wants Bukidnon to be a production basket with Cagayan de Oro as
its market. Bukidnon is Northern Mindanao's top coffee producer (Robusta nad Arabica)
with roughly 5,000 tons produced in 2007 according to the latest figures from the
Department of Agriculture (Rocky Mountain Cafe Company, 2011)
ENCA far is located municipality of Acop, Tublay, in the heart of Cordillera Mountains and
organizes a 20-member Arabica Coffee Growers Cooperative in the province of Benguet in
2008, this s one of the largest grossing products in local organic markets and these coffee
sales serves as an important livelihood for Ibaloi farmers throughout Benguet(ENCA EcoTourism Organic Farm, 2012).

CUSTOMERS
Young professionals and businessmen from the middle class to the high class society who
craves for Filipino style brewed coffee and mesmerizing ambience. Their mission is to
create an atmosphere where people, especially young and experienced professionals and
Filipino style coffee lovers, can come and nurture relationships, make one or simply flourish
by themselves. Their target market is the inhabitants in the Philippine archipelago and
foreigners who crave for the exotic and exquisite Filipino coffee taste. Bos coffee club
targets the concentrated market of the Philippine nation for their prices are higher
compared to the expected price of the typical and standard Filipino in terms of coffee
consumption. Given the purchasing power of the currency and the disposable income of
the nation, it can be quite heavy in terms of spending but the quality service and ambiance
emitted in the establishments is considered to be world-class and satisfying. They target a
specialized group of people who are willing to patronize and experience a whole new level
of Philippine grown coffee beans with a twist of class and sophistication. To be quite
specific, they target the young professionals and the experienced people in the high
working class where they can absorb and enjoy the exquisite ambience delivered by the
atmosphere and how the brewed coffee are said and marked as both exceptional and with
a hint of art.

B. MACROENVIRONMENT

IMPACTS OF POLITICAL FACTORS ON BOS COFFEE

The main political factor is about sourcing the raw materials. For this reason, the company
wants to adhere to social and environmental norms. It is willing to follow the sourcing
strategies. It gives importance to fair trade practices.
Another impact is the need to follow the laws and regulations where Bos Coffee buys the
raw materials. Activism and increased political awareness in developing countries have
made his essential.
The regulatory pressures within the home market are also a factor. The company must
monitor political stability within the country as well.
Some other factors to consider are:
Tax policy
Employment laws

IMPACTS OF ECONOMIC FACTORS ON BOS COFFEE

The ongoing global economic recession is the prime external economic driver for Bos
Coffee. This factor dented the profitability of Bos Coffee. This has convinced buyers to
shift to cheaper alternatives. As they did not quit buying coffee, Bos Coffee should seek an
opportunity here.
The company has to deal with rising labor and operational costs. The inflationary
environment and falling profitability is causing a lot of stress.
Some other economic factors which can affect Bos Coffee are:

1.

Local currency exchange rates

2.

Local economic environment in different markets

3.

Taxation level

IMPACTS OF SOCIO-CULTURAL FACTORS ON BOS COFFEE

As already stated, Bos Coffee can offer cheaper products but it might have to sacrifice the
quality. This is the main socio-cultural challenge that the start-up faces. It will expand
consumer base to include the buyers from the lower and the middle-income tiers.
The green and ethical chic consumers are also concerning. They fret about social and
environmental costs of the brands. Bos Coffee has to be aware of this trend.
The baby boomer generation is retiring. This means spending by older consumers will
decrease. Now, Bos Coffee will have to tap the Gen X and the Millennials as customers.
Other socio-cultural factors to focus on are:

1.

Changing family patterns

2.

Consumer preferences

3.

Changing work patterns

4.

Changes in lifestyles of population

5.

The level of education of the population in local markets

6.

Changing values among population

IMPACTS OF TECHNOLOGICAL FACTORS ON BOS COFFEE

Bos Coffee is in a good position to enjoy benefits of the emerging mobile wave.
The company introduced Wi-Fi capabilities in its outlets already. Internet is important to
the consumers. They can now surf the web and do work while sipping Bos coffee. This is
an added value to the brand. It enhances the overall consumer experience.
Some other technological factors to keep in mind are:

1.

Emergence of innovative technology

2.

Biotechnological developments

3.

Developments in agriculture

IMPACTS OF ENVIRONMENTAL FACTORS ON BOS COFFEE

Many Bos Coffee business practices concern activists and international advocacy groups.
Even the consumers have expressed issues. So, the company should take these into
account to continue holding consumers trust.
Some of the other environmental factors Bos Coffee should worry about are:

1.

Environmental rules and regulations

2.

Environmental disasters in countries which produce coffee beans

3.

Global warming and other environmental issues in a global level

IMPACTS OF LEGAL FACTORS ON BOS COFFEE

Bos Coffee must ensure that it does not violate any laws and regulations in the home
market and countries from where they buy raw materials.
It should also stay alert about introduction of caffeine production and consumption related
policies and regulations by health authorities.