COCA-COLA FEMSA PHILIPPINES,

TACLOBAN PLANT

Submitted by:
Group 5
Gajelan, Cindy B.
Ocayo, Juocel T.
Ponferrada, Kristine Gem
Tebrero, Rica A.
Villanueva, Dia

Submitted to:
Mr. Kevin Espocia
Subject Teacher
I. Company/Business Name: Coca- Cola FEMSA Philippines, Tacloban Plant

II. Company/ Business Background: First opened in 1953, the Coca-Cola FEMSA
Philippines, Tacloban Plant is a Tacloban City-based company engaged in the
production, bottling and distribution of Coca-Cola soft drink brands. It occupies a total
land area of 2.40 hectares and is nestled in front of the one of the city’s major rotundas.
Apart from Tacloban City, the plant also serves the areas of Ormoc and Samar. After
Typhoon Yolanda hit the city on 2013, the plant which sustained severe damages due
to the storm surges, had its reopening on September 10, 2014.

III. The Team

1. Chief Executive Officer

Mr. James Robert Quincey is the CEO of all the branches of Coca-Cola
FEMSA Philippines including the one in Tacloban. He has been making major
corporate decisions, managing the overall operations and resources for only three
years now but he was doing the same thing for Coca-Cola in Northwest Europe,
and Nordics Business Unit from 2008 to 2012. In 2013, he became president of
Coca-Cola Europe Group.
2. Manufacturing Executive

Mr. Joel Teves, PME is the manufacturing executive of the plant. He

supervise production employees, check inventory levels, and oversee equipment
maintenance and employee needs for 20 years now.

3. Sales Area Manager

Mr. Jesse Gabronino is the sales area manager of the plant. He manages
sales force within his defined regional territory, responsible for overseeing sales
operations, meeting targets and managing the sales team in the region for 12 years
already.
4. Safety Supervisor
The safety supervisor of the plant is Mr. Cleto Villaflor. He is responsible for
application of safety procedures on the ground and is doing the job for 11 years now.
5. Human Resource Head

Mr. Jerick Dumdum is the Human Resource Head of the plant. He is in-charge
of the department that deals with the employment, training, support, records, etc., of
the company’s employees, and is also responsible for writing up job descriptions. He
was appointed to the job since 12 years ago.

6. Operation Executive

The Operation Executive of the plant is Mr. Edgar Montes. He formulates

operational strategies and objectives to ensure the organization meets its goal and
operates successfully. He has been doing it for 9 years already.

7. Finance Accounting Executive

Mrs Myrna Campo is the Finance Accounting Executive of the plant. She is
responsible for managing the financial performance of the company and
establishing financial strategic goals, objectives and performance criteria and has
been doing it for 17 years.
8. Quality Assurance
Mrs Raissa Dycoco is the Quality Assurance of the plant. She conducts quality
assurance audits of bottler production facilities assuring company standards are
maintained and product integrity is preserved for 8 years already.
9. Field Quality Assurance Specialist
Mrs Rani Guimba is the Field Quality Assurance Specialist of the plant. She
develops strategies and techniques to ensure that all clients receive a similar high
level of quality and helpfulness for 10 years already.
10. Finance Accounting Supervisor
Mrs Felmarie Arorque is the Finance Accounting Supervisor of the plant. She
oversee accounting department functions to ensure efficiency and compliance, may
include supervising employees, maintaining financial records, and assisting with audits
for 13 years already.
 11. Engineer Supervisor
Engr. Arnel Delantar is the Engineer Supervisor of the plant. He performs work
related to design and survey, estimating costs of capital projects, short and long-term
planning relating to company’s infrastructure, as well as supervises a crew of
employees for 11 years already.
12. Security Coordinator
Mr Victorino Dichoso is the Security Coordinator of the plant. He coordinates,
develops and evaluates security programs for the company, ensures programs are
effective and identifies the need for additional resources for 7 years already.

IV. Vision and Mission Statement

Mission: To satisfy and please the beverage consumer through excellence.

Vision: To be the best global enterprise in leading beverage brand sales. To generate
sustainable economic and social value by managing innovative and winning business
models with the best employees in the world.

V. Market Summary

According to Philippine Statistics Authority (2015), there are 4,440,150 residents in

Region VIII. The demand of the residents in Region VIII and the supply of Coca-Cola to the
residents’ demand is illustrated below:

13% Demand
87% 13%
Supply

Graph 1.Percentage Distribution of Coca Cola Products in Region VIII

 Graph 1 shows the demand and supply of Coca-Cola Product in Region VIII. According to
Marlon Ventulan, human resource of the Coca-Cola Tacloban (2014), with their resumption, the
soft drinks needs of the region could now be at least stabilized. It was disclosed by Ventulan that
of estimated 100,000 cases a day consumption of the region, but they could not still meet the daily
need as they could only produce 15,000 cases as they are only using one line.

In Coca-Cola, market segments are basically those people who take this drink daily and
those areas where the demands is higher than the other areas. There are so many people who take
this drink daily and those people who take weekly and those who take less often are always there
as well. So, their basic segments are those people who take this drink regularly. The table below
shows the market segmentation of Coca-Cola Company.

Table 1. Market Segmentation

MARKET
SEGMENTATION CATEGORIES Target Market
APPROACHES
GEOGRAPHICAL Country region Region 8
DEMOGRAPHIC Age (Main target) the young
generation
(Co-target) the older
generation
Sex Female
Male
Family Dependent on their family
occupation and family
members
Income Different income levels by
packing

PSYCHOGRAPHIC Lifestyle Busy lifestyle

Mobile generation
 Social Class All social classes

BEHAVIORAL Benefits sought Different benefits from

different of the company
Occasion Every occasions which are
celebrated in the country

The graphs below highlights the company competitors of Coca Cola FEMSA Philippines
Tacloban Plant.

Graph 2. Market Share for Soft Drinks

70%
70%

60%

50%

40%

30% 20%
20% 10%
10%

0%
PepsiCo RC Cola Coca Cola

Graph 2 shows the companies percentage of customers they served for softdrinks in a year,
wherein 70% (Coca-Cola, Coca-Cola Zero, Sprite, Royal, and Sparkle) are Coca-Cola products,
20% (Pepsi, Pepsi Zero, 7up, Mountain Dew, Mirinda) are PepsiCo products, and 10% (RC Cola)
is RC Cola product.
Graph 3. Market Share for Water Products

35%
35%

30%
25%
25%
20%
20%

15%
10% 10%
10%

5%

0%
Nature Spring UR Universal Robina (B'lue) Wilkins (Coca Cola) Asia Brewery Inc. Otsuka Pharmaceutical
(Pocari Sweat)

Graph 3 shows the companies percentage of customers they served for water products in a
year. Wherein 35% for nature spring products, 10% (B’lue) for UR Universal Robina products,
25% (Wilkins) for Coca Cola water prodeucts, 20% (Summit and Absolute) for Asia Brewery
Incorporation, and 10% (Pocari Sweat) for Otsuka Pharmaceutical products.
Graph 4. Market Share for Non-Carbonated Drinks

30%
30%
20%
20% 15%

8%
10% 5% 5% 5% 5% 5%
2%
0%

Graph 4 shows the companies percentage of customers they served for non-carbonated
drinks in a year. Wherein 20% (Zest O) for Zest O Corporation, 30% (Real Leaf and Minute Maid)
for Coca Cola products, 5% (Lipton) for Unilever, 15% (Tropicana) for PepsiCo, 5% (Refresh)
for Refresh Company, 5% (C2) for Prime Key, 5% (Smart C) for Oishi, 5% (Mogu Mogu) for
Sapanan General Food Corporation, 2% (Del Monte Pineapple Juice) for Del Monte Food
Incorporation and 8% (Chuckie) for Nestle.
 Graph 5. Market Share for Powdered Juice Products

45% 40%
40%
35% 30%
30% 25%
25%
20%
15%
10% 5%
5%
0%
General Nestle SM Corp.( Coca Cola
Foods (Nesfruta) Magnolia) (Eight
Corp. o'clock &
(Tang) Nestea
Iced Tea)

Graph 5 shows the companies percentage of customers they served for powdered juice in
a year. Wherein 40% (Tang) for General Foods Corporation, 25% (Nesfruta) for Nestle, 5%
(Magnolia) for SM Corporation, and 30% (Eight o’clock & Nestea Iced Tea) for Coca Cola.

Graph 6. Market Share for Energy Drinks

30% 26%
21%
20% 15%
10%
10%

0%
PepsiCo (Gatorade &… Asia Brewery Inc.… Taisho… Red Bull GmbH (Red…

Graph 6 shows the companies percentage of customers they served for energy products in
a year. Wherein 26% (Gatorade & Sting) for PepsiCo, 21% (Cobra) for Asia Brewery
Incorporation, 15% (Lipovitan) for Taisho Pharmaceutical Corporation, and 10% (Red Bull) for
Red Bull GmbH.

As Coca-Cola expands its portfolio of beverages to align with people’s tastes and
preferences, the company is incorporating a “lift and shift” approach as it introduces new products
and innovations across markets around the world. More simply, when a product experiences
success in one part of the world, Coca-Cola will “lift” that product and “shift” it to another market.
Sometimes, it’s the exact same recipe. Other times, it’s the same product customized to meet that
market’s needs.

The lift and shift approach supports the company’s new growth strategy, which promotes
expanding its consumer-centric product portfolio, quickly scaling wins from market to market and
embracing an experimental, test-and-learn approach.

The prices of Coca-Cola products may be higher than the price of their competitors, but
they are still ahead in terms of sales because their products are world class quality and have unique
flavours.

Table 2. Coca-Cola FEMSA Philippines, Tacloban Plant using Porter’s Five Forces Model
Analysis

Threats of New There is an increasing amount of emerging new brands appearing in

Entrants/ Potential the market with similar prices with Coca-Cola. Coca-Cola is seen
Competitors not only as a beverage but also as a brand. It has held a very
significant market share for a long time and customers are not very
likely to try new a brand.
Threat of Substitute There are many kinds of energy drink soda or juice products. Coca-
Products Cola doesn’t really have an entirely unique taste of flavour. In a
blind taste test, people can’t tell the difference between Pepsi and
Coca-Cola.
The Bargaining Power The individual buyer is no pressure on Coca-Cola. Large retailers
of Buyers like Wal-Mart have bargaining power because of the large order
quantity but the bargaining power is lessened because of the end
consumer brand loyalty.
The Bargaining Power The main ingredients for Coca-Cola include carbonated water,
of Suppliers phosphoric acid, sweetener, and caffeine. The suppliers are not
concentrated or differentiated. The company is likely the largest
customer of these suppliers.
Competition Among Currently, the main competitor of Coca-Cola is Pepsi which also
Existing Firms have a wide range of beverage products under its brand. Both are
the predominant carbonated beverage and committed heavily to
sponsoring outdoor events and activities. There are other soda
brands in the market that became popular like Dr. Pepper, because
of their unique flavours. These other brands have failed to reach the
success of Pepsi and Coca-Cola.

VI. Strength- Weaknesses- Opportunities- Threats Analysis (SWOT)

External Enviroment

 Economy:
The economy in the region is rapidly-growing and it is both an opportunity and
strength for the company because they have an assurance that their target market
has purchasing power and they can use it to their advantage to increase their sales.
 Demography:
The company caters to all ages and gender, and now, they even have products for
babies and health-conscious customers.
 Customers/Total Market:
The company serves the entire population of Region 8 and this gives them the
chance to have higher sales.

 Competition:
Their competitors, especially Pepsi, are already arising and if this continues, they
may outrun the company in terms of sales and market share.
 Technology:
 The company uses up-to-date machines and equipment to make their processes
faster and easier.
 Political/Social Forces:
Level of corruption – especially levels of regulation in Consumer Goods sector
may interfere with their tax expenses.
 Government Taxation:
The higher the company’s income is, the higher the tax they will have to pay. The
tax on their raw materials like sugar can also increase their expenses.
 Climate:
The plant is situated in a region where typhoons are frequent and this may damage
the company’s properties and this will hinder their production and distribution of
products, just like what happened before with Super Typhoon Yolanda.

Internal Environment

 Products and Services:

The company has world class quality products and good customer service and this
helps the company to succeed.
 Financial Resources:
The company has sufficient financial resources since they have branches around
the country that can help the plant if ever unexpected events happen.
 Facilities/Machineries and Equipment:
The company uses advanced machines and equipment to make their products and
this makes the production faster.
 Manpower and Management:
The company has enough manpower to sustain their operations and they have good
managerial team.
 Technical Competence:
Their employees are computer literate and know how to operate and fix their
machineries and equipment. Research and Development: The company must
always search for new technologies that will enhance and develop their processes.
  Marketing Programs:
The company has different marketing strategies that are effective in advertising
their products and can reach a large number of audience.

VII. Business Strategy

 Good Customer Service
The company prioritizes to give good customer services to their clients to upscale
customer loyalty which will lead to increase in sales.
 Affordable Prices
The company sells their products in affordable prices to make sure that even the
low income customers will be able to buy and enjoy their products.
 World Class Quality and Food Safe Products
The company’s highest business objective is customer and consumer satisfaction
through delivering world class quality and food safe products. They make sure that
quality encompasses in everything they do.

VIII. OBJECTIVES AND GOALS (in the next 5 years)

Sales Revenue
Year 2019 – Year 2023: Increase sales by 10% every year.
Market Share
Year 2019 –Year 2023: Increase market share by 10% in five years.
ROI
 Production/Operation
- Supply will increase yearly by 5000 pieces to sustain the increasing demand
for the products
 Human Resources Requirements
- Recruit more employees for faster and more efficient production and
distribution of the products.
IX. Process Functional plans (5 years)
 Size of the Total Market
 Size of Target Market, Location, Market segments served
The target market of Coca-Cola Tacloban will continuously increase until the year
of 2023 and this will pave the way to increase the customers of the company.
 Differentiation
The company sells a large variety of beverages from soft drinks, powdered juice,
non-carbonated drinks to energy drinks while its competitors only offers a small
variety of these products.
 Positioning
- The company will continue to be on top ahead of its competitor
 Demand/Supply Analysis
 Market Share Projection

Market Share Projection for Soft Drinks

15%

5%

80%

Coca-Cola RC Cola PepsiCo

 Market Share Projection for Powdered Juice

30%
40%

5%

25%

Coca-Cola Nestle SM Corp General Foods Corp

Market Share Projection for Water Products

5%

15%
35%

10%

35%

Coca-Cola Nature Spring UR Universal Robina Asia Brewery Otsuka Pahrmaceutical

 Market Share Projection for Energy Drinks

10%

30%
18%

10%

23%

Coca-Cola PepsiCo Red Bull Asia Brewery Taisho

 5 years Sales Forecast

 Marketing Mix Strategy

1. Product

The products of the company include Coke, Sprite, Coke Zero, Royal, Sparkle,
Minute Maid, Thunder, Powerade, Eight O’clock, Wilkins Pure, Wilkin’s Distilled and
Real Leaf. The company offers their carbonated and juice products in different bottle
sizes that include: LRB (liter returnable bottle), PET 1.5 (1.5 liter plastic bottle), can
(tin pack 330 ml) and bottle (250 ml). They offer their powdered juice products in
sachets while they offer their water products in different bottle sizes that include: 1
liter, 1.5 liters, 500 ml, 330 ml and 6 liters. They also offer their energy drinks in
different bottles sizes that include: 330 ml, 250 ml, 20 oz., 32 oz., and 8 oz. Coca-Cola
products are available in different packing offers; 24 regular bottle shell, 6 bottle pack
 for 1.5 pets, 12 bottles in a pack for disposable bottle, 24 cans in one pack and 12 bottles
(250 ml) in one pack. Every product is sealed with the famous Coca-Cola logo.

Below are the products offered by the company:

250 ml 300 ml 330 ml 1L 1

1.5 L

250 ml 300 ml 330 ml 1L 1.5L

200 ml 300 ml 330 ml

1L

500 ml 32 oz. 1L 1.5 L

250 ml 300 ml 220 g 350g

1L 480 ml 300 ml 250 ml

 250 ml 300 ml 330 ml 1L 1.5L

500 ml 1L 330 ml 500 ml 1L 1.5L

 2. Place

The place or location of operations is very vital when marketing the products. It is
reflective of the costs of production in terms of the distance of the raw materials’
source, including the distance of the processing areas of Coca-Cola from its target
markets. The place can make or break an enterprise’ operational success. The place or
location must therefore be strategically located. It is very vital to the collective
marketing strategy that the enterprise is proposing.

The company supplies the entire Region VIII by delivering the products to six cities
namely; Baybay City, Ormoc City, Borongan City, Catbalogan City, Calbayog City,
and Maasin City. In every city, the company has dealers or partners which they deliver
their products to and then these dealers will be the one to distribute the products to the
nearby areas. The company supplies through different channel that includes:
wholesalers/distributers, retail/corner stores/super markets, restaurants/cafes/night
clubs and petrol stations.

3. Price

The price is based on the cost incurred in the production of the products.
Pricing for every commodity is very dynamic and must be sound enough in order
to sustain the operation and financial aspect of the enterprise.

Table 2. Products and Prices

PRODUCT SIZE PRICE (Php)

1.5 L 60.00
1L 30.00
Coca-Cola (Regular),
Coca-Cola (Zero), Royal, 330 mL 25.00
Sprite
300 mL 15.00
250 mL 12.00
300 mL 15.00
 Sparkle 250 mL 12.00
1L 60.00
Minute Maid 330 mL 25.00
200 mL 8.00
300 ml 13.00
Thunder 250 ml 9.00
350 g 48.00
Eight o’clock 1L 10.00
220 g 12.00
6L 80.00
Wilkins Pure 1L 20.75
500 mL 15.50
1.5 L 35.25
1L 25.00
Wilkins Distilled 500 ml 15.00
330 mL 10.00
Real Leaf 480 mL 35.00

32 oz. 60.00
500 ml. 46.00
Powerade 1L 130.00
1.5L 195.00

Coca-Cola uses the following alternate pricing strategies over the year for their
products:

1). Promotional Pricing: Coke also uses the promotional pricing strategy. Coca-Cola has
offered promotional prices as often as possible. In store that offer Coca-Cola, costs are
regularly incidentally valued underneath the rundown cost to build short-run deals. It gives
the item a feeling of criticalness and customers buy the item in view of the lower cost.
Coca-Cola organization offers motivations to middle men or retailers in way that they offer
them free example and free purge bottles, by this these retailers and centre man push their
item in the market. Also, that is the reason coca cola seen more in the market.

2). Segmented Pricing: Coke uses the segmented pricing strategy. Based on different
packages, Coca Cola is available at different price. By their product in different sizes and
at different costs, they get to increase their revenue, because there is not much difference
in the costs required to produce the products.

3). Discriminatory Pricing: Discriminatory Pricing Coke also follow discriminatory pricing
strategy, because they have different pricing when sold through different channels

4. Promotion

One of the success factors in marketing of products is product promotion. This

gives identity to the product, and could make the target markets some sense of
product recall that such products are from Coca-Cola. Good advertisement and
promotion is important to gain more attention from the target markets and that they
may promote curiosity on the products. The company uses different advertising
mediums to advertise their products. These include the following:

POS Material: POS material mean point of sale material this includes: posters and
stickers display in the stores and in different areas.

TV Commercials: As everybody know that TV is a most common entertaining

medium so TV commercials is one of the most attractive way of doing
advertisement. So Coca Cola Company does regular TV commercials on different
channels.

Billboards and Holdings: Coca-Cola is very much conscious about their billboards
and holdings. They have so many sites in different locations for their billboards.

The company also uses different strategies to promote their products like
the following:
 Getting Shelves: They get or purchase shelves in big departmental stores and
display their product in that shelves in that style which show their product clearly
and more attractive for the consumers.

Eye-Catching Position: Salesman of the company positions their freezers and their
products in eye-catching positions. Normally they keep their freezers near the
entrance of the stores.

Sale Promotion: Company also do sponsorships with different college and school’s
cafes and sponsors their sports events and other extra curriculum activities for
getting market share.

UTC Scheme: UTC mean under the crown scheme, Coca-Cola often do this type
of scheme and they offer very handy prizes in it. Like once they offer bicycles,
caps, TV sets, cash prizes etc. This scheme is very much popular among children.
They usually do this during Christmas seasons.

Marketing Budget (Promotion and Advertising etc.)

MEDIA Budget Requirement (Php)

Point of Sale Material 1,000,000.00
Billboard and Holdings 2,000,000.00
TV Commercial 5,000,000.00
STRATEGY
Getting Shelves 1,200,000.00
Eye-Catching Position 2,000,000.00
Sale Promotion 2,500,000.00
UTC Scheme 1,500,000.00
Total Budget Requirement (Php) 15,200,000.00

Production Plan

 Product/Service Specification
 Soft drinks, juice and powdered juice products, energy drinks and water
are the products offered by Coca-Cola FEMSA Philippines, Tacloban Plant.
These products are potential income earners being considered as emerging, and
most of all, promising market players.

 Production Process (Process Flow)

 Production Facilities and Equipment (include Plant Layout)

The table below shows the list of the facilities, equipment, and
machinery such as the transport vehicle and other materials needed by the
enterprise for its full operation.

Table 3. Equipment and Machinery Equipment

Equipment, and No. of Units

Machinery Purpose Proposed Existing Unit Cost (Php)
Requirement
 used in purifying the
Water Filtration raw water to be 25 10 150, 000.00
Equipment drinkable
Used in the glass
bottle filling
Soft Drink Filling carbonated beverage, 15 8 200, 000.00
Machine glass bottle washing,
and capping
used in washing,
Carbonated Beverage filling and sealing 25 12 100, 000.00
Filling Machine carbonated beverages
Used to deliver the
products to the
Delivery Trucks different areas of 30 20 2, 500, 000.00
Region 8
Used to fill purified
water, distilled water,
Water Filling Machine mineral water and 21 14 200, 000.00
other bacteria free
liquids.

Used to reduce
materials with outside
Water Bottling touch time, improve
Machine sanitary conditions, 23 11 240, 000.00
and production
capacity.
Used to fill a product,
Juice Filling Machine generally juices, into 17 9 280, 000.00
bottles in a large scale
 Organization Plan

 Legal Form of the Business

The legal form of the business is corporation. The company will comply with the
requirements of government regarding establishment of business. This includes Mayor’s
permits, BIR registration, and DTI registration of business name. It will also be required to
register at the offices of SSS, PhilHealth and Pag-Ibig as employer to comply with the
Philippine Labor Code. The staff of the enterprise will also be capacitated on enterprise
and business development.

 Organizational Structure

 Chair person
vhair person

General manager

Marketing Manager Factory Manager Accounting Department Shipping Department

Shipping manager
Marketing Manager Production Manager

Shipping officer shipping

Sales manager o/s Sales manager (base)

Quality control Mechanical engineer Personnel manager

Distribution officer

Sales officer Sales officer

Sales supervisor Sales supervisor

Sales man Sales man

 Table 4. Recruitment of Needed Employees

Staff/Position No. of Staff/Officers Qualifications

Must have a Bachelor’s
Degree in Computer Science,
Technical Engineer 5 electrical engineering and at
least 3-5 years of experience
in the field
Must have a high school
diploma, may pursue
Security Guard 5 additional educational such as
an associate’s degree in
criminal justice
Ability to work in all weather
and must be punctual and
Laborers 50 reliable and know how to
manage their job/time
Must have a 3-year driving
Drivers 10 record
Required to have a
Sanitation Engineer 7 Bachelor’s Degree in
Environmental Engineering
Must know the basics of first
First Aider 10 aid and know how to handle
accidents.

Financial Plan

 Total Project Cost

  Sources of Funds
 Projected Statement of Financial Performance
 Projected Statement of Financial Position
 Cash Flow Statement
 Financial Analysis

X. CONCLUSION