1. Describe the marketing environment of Aquarius Food Industries.

What are the

opportunities and threats?
Aquarius Food Industries (AFI) is a small and focused food company specializing
in the production of processed shrimp paste or bagoong alamang. Shrimp paste is
versatile in terms of acceptability in the market because it is considered as a condiment
for different food recipes. The main ingredients of the shrimp paste which is the shrimp
fry was directly purchased to the fishermen or from the wet market, thus, it has an
advantage of having a low price and abundance of raw materials. The major regions such
as Luzon, Visayas and Mindanao are considered as the breakdown of the market for the
shrimp paste in the Philippines. In Mindanao, Neptune, the brand name of the product of
AFI, is one of the major players in producing shrimp paste, with a market share of 30
percent, together with Lasap, a competing brand of Neptune, and 20 percent for Frisco
accounts and the remainder is spread out among few other players. Consecutively, in
Luzon, Shrimp paste is normally bought from supermarkets shelves with various
competitors that have well-known brands. And in Visayas, the product is hardly sold
because of the conventional wisdom that the region is mainly consists of coastal towns
which has fresh seafood that are available.
The opportunities of the Aquarius Food Industries are the following: (1) Toll
manufacturing which means that the AFI will extend their output to the Golden Hands
that will increase their sales, (2) SM Bonus is also planning to toll manufacture their
products to fill up the demands of their customers that will again give an opportunity for
the AFI to increase their sales, (3) AFI has to have a more varied product line to keep up with
competition and allocate fixed costs over more output that will mean a higher profit for their
company, (4) Possibility of exporting the new products, and (5) Processed coconut items that can
utilize the equipment and materials in making shrimp paste that will serve as an advantage for
them. However, there are also some threats that the AFI must consider like their competitors such
as Lasap (in Mindanao), Barrio Fiesta, Kamayan (Golden Hands), Chowking, SM Bonus, Lee
Kum Kee and Tanjung Malacca including the intentions of Lasap to modernize plant facilities and
squeeze out costs further that make some of the wholesalers to shift allegiance.

2. What are the strategic and operational issues that Aquarius Food Industries is facing?
The strategic and operational issues that Aquarius Food Industries is facing are the
following: (1) Toll manufacturing arrangement for Golden Hands that compromised the
total sales volume of their brand, (2) Having this arrangement tends to be more volatile
that depends essentially on the availability of shrimp fry, (3) Toll manufactured products
are being sold in Luzon for thrice of its the price. (4) Stretching of payments terms, (6) SM
Bonus also offers AFI to toll manufacture their product, (5) In the long run, AFI has to have a
more varied product line to keep up with competition and allocate fixed costs over more output.
(6) Processed coconut items that can utilize the equipment and materials in making shrimp paste.

3. Given the issues in question number 2, what alternatives are available to the company?
The alternatives that are available to the company are: to continue or not the toll
manufacturing the product of the Golden Hands and other toll arrangements as it
compromised the total sales of the Neptune and dependability of some toll arrangements
to the supply of shrimp fry as it lessen the demand if the shrimp fry is abundant.
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Consequently, they may choose sell their product directly in Luzon to have the advantage
of getting the higher price and gaining more revenues or not and to establish or not a new
variety of products that can probably increase their sales. And join in processing coconut
items that utilize the equipment and materials in making shrimp paste or not because of
the abundance of the players in this particular food segment.
4. Which alternative and courses of action would you recommend? Why?
Based on the alternatives that are available, I would recommend to continue
having the toll marketing for Golden Hands because although it compromised its total
sales, it can be resolved by a good forecasting technique that can be able to anticipate the
right amount of product to manufacture during a certain period. The AFI may also extend
their production up to Luzon and sell their product for thrice the price which can be
probably done by hiring a logistics for the distribution of the product. In terms of the
development of the product, it is good to have more varieties of the shrimp paste because
the customers will have the chance to choose other viand of the product and this maybe a
venue for possible exportation of the product. In addition, the AFI must not pursue the
deal to manufacture coconut items because of abundant players in this food segment.
However, if the one who offers the deal will make first a further study about the food
segment and will have a favorable output, maybe AFI can have coconut items because
they have already the equipment and packaging materials. Finally, the AFI must
considered different ways to realize revenues for the betterment of the company.

Aquarius Food Industries SWOT ANALYSIS

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STRENGHTS

WEAKNESSESS

PRODUCT/ OPERATIONS:
Raw Materials (Fresh Shrimp Fry) were abundant
for small and focused manufacturer.
Shrimp Paste is versatile for dishes that enable it to
be more acceptable in the market.
Production process is a relatively simple one but
with unique and hard to imitate process that has
low processing cost.
MARKET POSITIONING:
No brand loyalty, thus, price is the main criterion in
making purchase decision.
DISTRIBUTION:
AFI has hired an independent agent, working
solely on commission basis, to check on the
various wholesalers inventories, so that those with
critical stock levels can be served first.
PROMOTIONS:
Davao Duck Enterprises pushes the product with
aggressive in-store promotion.
Promo girls are virtually thrust the product in the
customers face.
OTHER ADVANTAGE:
Tex is a fresh business graduate from one of the
countrys leading universities, therefore has many
strategic ideas in starting a good business.
OPPORTUNITIES

DISTRIBUTION:
It is not a food item considered to be an everyday
condiment.
Encountered in dealing with these distributors
who are prioritizing whose orders get filled and
shipped out first.
PROMOTIONS:
No specific sales figures per city are available,
thus, unsure of the exact demand or sales pattern.
Stretching of payments terms.

THREATS

TOLL MANUFACTURING
Golden Hands asked the AFI to sell part of its
output to them.
OPPORTUNITIES FOR GROWTH:
SM Bonus offers AFI to toll manufacture their
product.
In the long run, AFI has to have a more varied
product line to keep up with competition and
allocate fixed costs over more output.
Possibility of exporting the new products.
ANOTHER BUSINESS VENTURE:
Processed coconut items that can utilize the
equipment and materials in making shrimp paste.

COMPETITORS:
There are different competitors of the product:
a. Lasap (in Mindanao)
b. Barrio Fiesta
c. Kamayan (Golden Hands)
d. Chowking
e. SM Bonus
f. Lee Kum Kee
g. Tanjung Malacca
OPPORTUNITIES FOR GROWTH:
Lasap expressed intentions to modernize plant
facilities and squeeze out costs further that make
some of the wholesalers to shift allegiance.

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