老曾记 市场研究报告.docx

老曾记 市场研究报告.docx

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老曾记市场研究报告

MarketingProject

November4

2011

PreparedbyTeeJiaRongChoSungHyeAnandrajYunJiaoYanJun

ExecutiveSummary

Startedin1956asasmallstall,OldChangKeehastransformeditselfintoasuccessfullocalbrandthatisbestknownforitscurrypuffsandotherfried-fingerfood.Itsgrowthintheindustrycancertainlybeattributedtoitsvarioussuccessfulmarketingstrategiesthroughtheyears.

GiventhedynamicnatureoftheF&Bindustry,OldChangKeehastoconstantlyadapttothechangingenvironmenttoremaincompetitive.Withtheincreaseincompetition,OldChangKeehastoreviewitsmarketingpoliciesandfocusonitscorecompetenciestomaintainitsbrandimagetobesynonymouswithtradition.

ThisreportseekstohighlightandanalyzethecurrentmarketingstrategyandmixesthatOldChangKeeisemployingbasedonthecompany’sintendedcustomeranalysisandsegmentation.ThiswillbedoneusingthePESTELframework,Porter’sFiveForces,andSWOTanalysis.Inaddition,thereportwillidentifyareasthatOldChangKeecanimproveonandproviderecommendationswithrespecttoitsmarketingobjectives.

Theresearchdatawasgatheredfromonlineannualreports,websitesandaninterviewwiththeCEOofOldChangKee,MrWilliamLim.

Usingamacro-environmentalanalysis,ithasbeenidentifiedthatOldChangeKeehastoconstantlyintroducenewproducts,whilemaintaininglowpricestoremaincompetitive.Inkeepingitspriceslow,ithastointegrateITintoitsproductionsystemaswellastodiversifyitssourcesofrawmaterials.ThisisfurthersupportedbyPorter’sFiveForceswheretheintensityofrivalryandtheavailabilityofsubstituteproductshavebeenidentifiedtobethemainconcernsforOldChangKee.

Duetoitslowmarginalprofit,providingpricepromotionsmaynotbefeasibleforOldChangKee.Therefore,itisrecommendedthatmovingforwardOldChangKeefocusonitsAdvertisingandPublicRelationstoreachoutfurthertoconsumersandimprinttheirbrandnameintothemasses.Thiscanbedoneviaconductingentrepreneurialtalksinschoolsaswellascreating‘promotioncards’toengagepublicparticipationwhilecreatingtheopportunityforthemtotryawholerangeofproducts.

2.Companydescription

OldChangKeeisanestablishedcompanyinSingaporeF&Bindustry,whichspecializesinfingerfood

hasbeentransformedfromasmallcoffeeshopstalltoSingapore’sleadingbrandofcurrypuffsandotherhotfingerfoodin30yearsfrom1956.TheestablishmentoffactoryinWoodlandssignifiedOCK’sbeliefthatconstantupgradingoftechnologyandmodernizationarethekeystostandardizetheworkflowandtoensurestringentqualitycontrolofOCK’sfoodproducts.

Inordertodifferentiatefromitscompetitorsinthefast-foodindustry,OCKhascomeupwithdistinctivesub-brandnamesforallitsproducts.Besides,OCKhasbeenpersistentinpreservingtraditionalSingaporeanflavor,yetintelligentlyadjustableinitsmarketingstrategiesinresponsetothekeep-changingconsumertrends.Moreover,thefactthatOCKhasachieved“Halal”certificationhasenabledthecompanytoreachouttotheMuslimcommunity,andmanyofOCK’sfingersnacksoriginatefromdifferentethnicculturesaswell.ThisisessentialforOCK’ssuccessinamulti-culturalandmulti-religioussocietylikeSingapore.Asawhole,theseapproacheshaveenabledOCKtoberecognizedasamajorhouseholdbrandwithadistinctiveflavorandheritageinmodernSingaporesociety.

CurrentlyOldChangKeeisavailablein47retailoutletslocally.Inordertomatchupwiththeshiftingconsumertrends,ithasalsodiversifiedandextendeditsproductrangetoincludeothersnacksanddessertssuchascrabclaws,sotongfrittersandpineapplespies.

ThismarketingplanshalloutlinehowOldChangKee–asmallstall-wastransformedintoSingapore’sleadingbrandofcurrypuffsandotherhotsavouries.

3.OrganizationstructureofOldChangKee

TheBoardofDirectorsconsistsofanexecutivechairmanandaChiefExecutiveofficerandthreeindependentdirectors.Theexecutivechairmanismainlyinvolvedintheoverallmanagementandbusinessstrategiessettingofthecompany.ChiefExecutiveOfficer,ontheotherhand,isresponsibleforproductandmarketdevelopmentandsupervisingsalesdevelopmentstrategies.Independentdirectors,whodonothavepastorongoingbusinessrelationshipswithOldChangKee,providesalternativechannelsthroughwhichinvestorscommunicatewithmanagementswhennormalchannelsoftheExecutiveChairmanorChiefExecutiveofficerareineffective.Theyalsoserveasconsultantstothemanagementinareassuchasaccounting&finance,business&management,corporategovernanceandlaw

UndertheExecutiveChairmanandtheChiefExecutiveOfficertherearefivemajormanagerswhoseresponsibilitiesarelistedintheorganizationalchartabove.

4.RecentPerformance-financialanalysis

OldChangKeehasasteadyperformanceintermsofmarketcoverageandsalesgrowth.Asat31December2010,theGroupoperatedatotalof78outletsinSingaporeascomparedto76outletsasat31December2009.SalesRevenuehasanaverage7%increasesince2008.

However,grossprofitmargindeclinedfrom61.3%ofrevenuein2009to59.9%in2010,whichcanbeattributedtoahigherrawmaterialcostsandhigherdepreciationexpensesonplantandequipment.Overall,theprofitmarginisroughlyconstantsince2006,meaningthecompany’sprofitabilityhaseitherdeclinedorgrownoverthelast5years.Moreover,thereisageneraldecreasingtrendofthecompany’ssalesgrowthfigure.Thereasoncouldbethatthedomesticmarket,whichcontributedagreatpercentageofoverallsales,isfairlysaturated.

2010

2009

2008

2007

2006

Salesgrowth

8.0%

6.5%

19.5%

20.0%

21.6%

Profitmargin

59.9%

61.3%

59.6%

58.6%

59.1%

Besides,netprofitdecreasesfrom$4,298,000in2009to$2,851,000in2010.Themajorreasonforthisisthereductioningovernmentalgrantsin2010.Forinstance,thecompanyreceivedagrantofabout$827,000undertheJobsCreditScheme.Thegrantamountwasreducedtoabout$173,000in2010.

Intermsoffinancialhealthofthecompany,OldChangKeehasagoodcurrentratio,whichincreasesfrom1.8in2008to2.3in2010.Thenetworkingcapitalalsoimprovesin2010.Thisindicatesthatthecompanyisliquidandunderlittlepressureofrepayingshort-termdebt.

Intermsoffinancialhealthofthecompany,OldChangKeehasagoodcurrentratio,whichincreasesfrom1.8in2008to2.3in2010.Thenetworkingcapitalalsoimprovesin2010.Thisindicatesthatthecompanyisliquidandunderlittlepressureofrepayingshort-termdebt.

5.Macro-environmentalanalysis

Toanalyzethemacro-environmentofOldChangKee,wewilladoptaPESTELframework,i.e.fromthesixperspectives,namelypolitical,economic,social,technological,environmentalandlegal,soastogainaholisticunderstandingofexternalfactorsthatinfluencethebusinessofOldChangKee.

Socialfactors:

ThereareafewsocialfactorsworkinginOldChangKee’sfavor.Itstake-away,finger-food-fashionproductsfitwellintoSingaporean’sfast-pacelifestyle.Itssignaturefood—currypuff—isviewedasarepresentationofSingaporeanflavorandattractsalargenumberoftourists.

However,thereisgrowinghealthconcernamongSingaporeans.Someindividualsmayrejectfriedfoodwhichtobeunhealthy.AdropindemandforOldChangKee’sfoodproductmightbepotentiallyresultedifsuchconcernsarenotaddressed.

Economicfactors:

Givenitslowpricerange,OldChangKee’sfoodproductholdsaverylowpercentageofconsumer’soveralldiscretionaryincome.Hence,demandinelasticitywithrespecttodisposableincomerendersOldChangKeerelativelyrecession-proofandthisisdemonstratedbyitssteadysalesgrowthsince2007.However,itcouldplaytoOldChangKeedisadvantageintheeventwhereconsumer’sincomeincreases,itmightnotresultinaproportionateincreaseindemandforitsfoodproduct.

Therefore,OldChangKeemustenhanceitsbrandimageandintroducenewproductstocatertopeople’schangingpreferenceandtaste.F&Bindustryisalsoremarkablysusceptibletofluctuationinrawmaterialprice.Forexample,recentfloodinThailandcausesasurgeinpricesofrawmaterialsthatcouldinturnaffectproductioncostofOldChangKee.

Exchangeratealsohasaconsiderableeffectsincerawmaterialsandingredientsaremostlyimportedfromoverseas.Forinstance,depreciationofSporedollarwouldmeanmoreexpensiveimportedingredientsandrawmaterialsintermsofS$.

Technologicalfactors

OldChangKeeridesthetideofwidespreadofE-Commerce,increasingitsproductavailabilitythroughonline-order.Besides,theongoingITprojecttoincorporateITintoitsoperationmanagementandwastemanagementsystemhelpstofacilitatethemarketexpansionstrategybyprovidingup-to-datemarketindicators.

Duetothedifferencesindemographics’specifictasteandpreferences,OldChangKeeconductR&Dlocally,andatthesametime,outsourceslabteststoforeignlabsinordertoreducecost.

PoliticalandLegal:

OldChangKeebenefitedfromgovernmentalgrantsinformsofJobCreditSchemein2009.However,thisismerelyashort-termboostpolicyandgrantssuchasthesefluctuate.OldChangKeesufferedfromadecreaseofnetprofitduringyear2009and2010partiallyduetothedecreaseingrants.

Torespondtotherisingpublicconcernonfoodsafetyandquality,OldChangKee’sobtainedHACCPcertificationforthemanufacturingofCurrypuffandimplementedaqualityassuranceprogramconductR&Dlocally,andatthesametime,outsourceslabteststoforeignlabsinorder