JKALINGA’S BANANA CHIPS
(Marketing Plan)
KALINGA STATE UNIVERSITY
Tabuk City, Kalinga
JONALYN E. ARELLANO
MBA – 1A
TABLE OF CONTENTS
Title Page
I. Executive Summary
II. Situational Analysis
Current Situation - Macroenvironment
Political/Governmental State
Economic State
Sociocultural State
Technological State
Current Situation - Market Analysis
Market definition
Target Market
Market Needs
Market Trend
Market Growth
Competitors & Suppliers
Current Situation - Consumer Analysis
Geographic
Demographics
Psychographics
Behavioral Factor
Customer
Customer Perception
Current Situation - Internal
Mission statement and Vision statement
Objectives
Financial objective
Marketing objectives
Company Resources – Uses of Funds
III. Summary of Situation Analysis
Strength
Weaknesses
Opportunities
Threats
Strategies
Keys to success
Critical Issues
IV. Marketing Research
V. Marketing Strategy
Product
Production process
Processing Flow Chart
Price
Costing and Pricing
Place or Distribution
Promotion
Marketing Strategy
Positioning
VI. Financial Projection
Projected Income Statement
Notes
VII. Sales Forecast
VIII. Contingency Plan
IX. Controls
X. Conclusion
I.EXECUTIVE SUMMARY
Bananas are vigorously growing, herbaceous plants growing in every humid tropical region.
But some are being wasted especially when become overripe that is why with the help of some
information and coaching it can be utilize and make them a source of income. It is a strong demand
for banana chips as most people enjoy eating snacks. In addition, there is a great opportunity in the
market since Philippines is one of the top four banana producers and main world exporter of banana
chips.
The JKalinga’s Banana Chips are delicious, crispy, and healthy snacks. They are made from the
Filipino banana “saging na saba” or cardava variety. Smooth delicious bananas are picked in their
mature green stage, peeled, thinly sliced, sugar sweetened and the fried in vegetable oil. A nutrientdense food, contributing to a healthy diet by providing not only potassium but also calcium, carotene,
vitamin C, vitamin B6 and rich in fiber. The banana chips are packed by 25 grams in plastics and are
each pack is individually labeled. It provides a wide variety of premium quality chips with a production
process that uses primarily bananas and other ingredients which are all natural, no preservative or
additive. The business establishment will be located accessibly along the road at Purok 2, Bulanao
Tabuk City Kalinga. In starting the business JKalinga’s Banana Chips needs Php 260, 735 covering the
land, building and other facilities that are needed in the operation.
Within a short time, this product has ensured its position both in rural and urban areas. The
market size is fairly change and is expanding day by day. Since one of the objectives is providing the
best quality of banana chips that will achieve the desired satisfaction and ensures the excellent
services rendered. JKalinga’s Banana chips sales are estimated to grow by at least 30% for the next
few years.
II. SITUATIONAL ANALYSIS
CURRENT SITUATION – MACROENVIRONMENT
Political Factors
The Provincial Government of Kalinga as well as national government
agencies like the Department of Trade and Industry and Department of Science and
Technology are supportive to entrepreneurs and the whole business sector.
Economic Factors
Inflation is a problem of all businesses. Although inflation does affect the
business in the costing of the raw materials and pricing of the finished goods to a great
extent, it significantly affects the purchasing power of the money given to students as
allowance.
Socio-Cultural Factors
JKalinga’s banana chips product competes with other snacks in capturing the
taste and preference of students who are the end customers of its market. These other
snacks include the veggies chips, potato chips, taro chips and other junk foods. They are often
preferred by students.
Technological Factors
Training on banana chip production in the future, can open doors to the use of
technology in the business. Technology, automation can increase the efficiency of the
production, in volume and quality and can therefore pave the way to banana chips
export.
CURRENT SITUATION – MARKET ANALYSIS
TARGET MARKET
JKalinga’s Banana Chips is on the rise, grabbing the attention of consumers as well as wholesalers and
retailers. The main target people are the young ones who like to eat chips very much but it can prefer
also to the adult and old ages. Its target market is the different snack zone specifically on school
canteens, non-school canteens like grocery and stores around the province, moreover on terminals
for pasalubong purposes. At present Kalinga composed of 8 municipalities having a total of 160
elementary school, 30 public secondary and 7 private school, and 6 schools of colleges. These are the
potential consumer of banana chips in the province.
It was consulted with 50 people of different ages to identify the presentence of different
age’s consumers of chips.
Respondent's
Age
below 10
10 to 20
20 to 30
Above 30
Total
Frequency
6
22
18
2
50
Percentage
16
44
36
4
100
Cumulative
%
16
60
96
100
Age of group of consumers of banana chips
MARKET NEEDS
JKalinga’s Banana Chips is providing its customers with a selection of high-quality chips that
are unique and pleasing in presentation, offer a wide selection of health-conscious choices, and
utilizes top-shelf ingredients. JKalinga’s Banana Chips seeks to fulfill the following benefits that are
important to the customers.
Selection. A wide choice of snacks. It can either be a retail or wholesale.
Accessibility. The customer can gain access to the store with minimal waits and can choose the
option of delivery or for pick up.
Customer service. The customer will be impressed with the level of attention that they receive.
MARKET TREND
The market trend for stores is headed toward a more sophisticated customer. The store
customer today relative to yesterday is more sophisticated in a number of different ways.
> Food quality. The preference for quality ingredients is increasing as customers are learning to
appreciate the qualitative differences and its benefits.
> Presentation/appearance. As presentation of an element of the business experience becomes
more pervasive, consumer is learning to appreciate this aspect of the industry, where in packaging is
one of the major strategies that makes the product more quality and pleasing to the eyes of
prospective costumer especially to kids.
> Health consciousness. Now a days people are more cognizant of their health, evidenced by the
increase in individuals exercising and health club memberships, customers are requesting more
healthy alternatives when they eat foods. They recognize that an entree can be quite tasty, and
reasonably good for you.
MARKET GROWTH
One big boost to the export potential of the Philippines is banana chips. Industry insiders said
the chips market has grown which is driven by the young generation's consumption. Banana chips
sales are estimated to grow by at least 30% for the next few years. This growth can be attributed to
several different factors. The first factor is an appreciation for health-conscious food. Banana chips
can be very tasty yet health conscious at the same time. Banana chips is seen as a healthy food
because of its high percentage of carbohydrates relative to fat.
Another variable that is contributing to market growth is a strong demand for banana chips
as most people enjoy eating snacks. In addition, there is a great potential and opportunity in the
market since Philippines is one of the top four banana producers and main world exporter of banana
chips.
Competitors
The Banana chips industry in Philippines is not small. There are a lot of banana
chips producer. Some of them are national and some of them are local suppliers. Kalinga province also
have producers of banana chips like farmers group associations like Dupligan Multi-Purpose Tanudan,
cooperatives like the Bulanao Multi-Purpose and Pinukpuk Farmers Cooperative, and individuals like
Nitz Veggies chips in Rizal and others. They are comparatively costly also. The consumers’ taste and
demand are changing from low quality chips to high quality chips. An edge of JKalinga’s Banana Chips
because most of them produces bigger packages the price range is 10 to 30 pesos which is not for sure
affordable to all ages especially the students.
Suppliers
Kalinga has a lot of resources of banana. So, the supply of raw materials from local and foreign
sources is very important in producing the chips and its good management can be a competitive
advantage.
CURRENT SITUATION – CONSUMER ANALYSIS
Geographic:
• For the urban and sub urban and rural areas citizen of Kalinga and all over the country.
• Especially for the convenient transportation areas.
Demographic:
• Children generally under teen-age.
• Young generation generally under age range 13-25.
• Educated people and conscious parents.
Psychographic:
• The lower middle class, middle class, and upper middle class.
• The conscious people.
Behavioral Factor
• Those who have negative idea about the traditional chips.
• Those who seek good quality.
• The non-users and regular users of the chips.
Customers
Banana Chips is an all age product Chips are generally taken for granted that chips are
a kind of kid’s food. But it is found that people of all age enjoy chips and a large market segment for
chips lies on the age group of 10 to 20. To all the schools and retail stores, this product has huge
popularity. And many of them are fond of chips. So, there is vast market for the chips industry.
Consumer’s perception
Regarding the previous brand of the snack item consumer in most of the cases was not familiar that
much with the brand. So, there is no question about brand loyalty because even the brand familiarity
was not created as per it is expected for a brand to hold a substantial market share.
CURRENT SITUATION – INTERNAL
Vision
In 5 years, JKalinga’s Banana Chips will be the main and biggest banana chips manufacturer in Kalinga
and will contribute to the Philippines banana chips export market.
Mission
To provide satisfaction with good quality of products, impeccable services, guaranteeing enough
supply and developing strong relationship with customers.
Objectives
• To provide best quality of banana chips that will achieve the desired satisfaction and ensures the
excellent services rendered.
• Aims to create jobs for people.
• To reduce post harvesting loss on fruits through processing the fruit into banana chips.
Marketing Objectives
• To maintain positive, steady growth each month
• To increase new customer who don’t buy banana chips. Create loyal customers.
• Intends to price the product as a premium type that is affordable enough to the consuming public.
• To export products to other countries.
Financial Objectives
•Increase the profit margin by 1% per quarter through efficiency and economy-of-scale gains.
• Maintain a significant research and d e v e l o p m e n t budget (as A percentage relative to sales)
to spur future product developments.
USES OF FUNDS(Resources)
Start-up Cost Summary
JKalinga’s Banana Chips start-up cost is Php 260,735.00 covering the land, building, furniture
and fixtures, equipment, kitchen utensils, direct materials, direct labor and manufacturing overhead.
Project Cost
The initial capital will be used for the provision of the following:
Land
Building
Php 100,000.00
50,000.00
Furniture & Fixtures
5,500.00
Equipment
3,800.00
Kitchen Utensils
5,785.00
Direct Materials
59,250.00
Direct Labor
28,800.00
Manufacturing Overhead
7,600.00
III. SITUATIONAL ANALYSIS
SWOT Analysis
A scan of the internal and external environment of the business indicates the
following:
Strengths
- With know-how in the manufacturing of banana chips
- The snack product is nutritious. Its nutritional contents include potassium
and protein
- Offer high quality banana chips that will exceed the competitor’s price, quality and services
- Great retail space that is bright, hip, clean and accessible along the road
- High customer loyalty among repeat customers
- Excellent staff who are highly trained and attentive to customers need
- Strong relationship and frequent delivery of vendors of the banana
Weaknesses
- Lacks access to grocery stores and school or office canteens
Opportunities
- Some producers often or stop making banana chips in the province
- A supportive government indicates that there is a bright future for the firm
in the export market
Threats
- The preference of students and young people to eat junk foods
- The prices of cooking oil and sugar are increasing likewise the banana if the supply in the market is
low.
Strategies
Strength-Opportunities:
- Extensively promote nutritious product to students of the different schools
by joining trade fairs during school activities
- Accumulate profit and reinvest it for expansion of business and
distribution in the neighboring places Kalinga
Weaknesses-Opportunities
- Concentrate marketing efforts on the distribution to offices or school canteens
- When sales volume increases due to increased demand for the product,
find suppliers outside Kalinga and negotiate terms.
Strengths-Threats
- Invest in Research and Development activities to obtain cost efficiency
and optimal productivity
- Package and label product differently to attract even junk food eaters
Keys to Success
The keys to success are designing and producing products that meet market demand. In addition,
JKalinga’s Banana Chips must ensure total customer satisfaction. If these keys to success are achieved,
it will become a profitable, sustainable company.
Critical Issues
As a start-up business, JKalinga’s Banana Chips is still in the early stages. The critical issues are for
company to:
■ Establish itself as the premier chips company.
■ Pursue controlled growth that dictates that expenses will never exceed the
revenue base. This will help protect against recessions.
■ Constantly monitor customer satisfaction, ensuring that
the growth strategy will never compromise service and satisfaction levels.
IV.MARKETING RESEARCH
During the initial phase of the marketing plan development, several focus groups were held to gain
insight into prospective customers. These focus groups provided helpful insight into the decisionmaking processes. An additional source of dynamic market research is a feedback mechanism
based on a suggestion system. In the suggestion system customers are asked to rate in terms of a
given scale. There are also several open-ended questions that allow the customer to freely offer
constructive criticism or praise. JKalinga’s Banana Chips will work hard to implement reasonable
suggestions in order to improve the products offerings, as well as show its commitment to the
customer that their suggestions are valued. The last source of market research is competitive analysis.
JKalinga’s
Banana
Chips
will
send people to local competitors to gain information about their product offerings and also
its
competitors’ product offerings.
V.MARKETING STRATEGY
Product
JKalinga’s banana chips are healthy and delicious snacks, perfect taste, versatile and abundantly
available in all seasons. Bananas are dipped in sugar syrup before fried. Banana chips are an excellent
source of manganese, an essential antioxidant. One serving provides 66% of the recommended daily
value of this mineral. It also contains other minerals such as potassium, iron, copper, magnesium and
rich in fiber. Cardava bananas is what they called in Mindanao while “saging na saba” in the Philippines
and “Dippig” in Ilocano. This banana contains the highest amount of nutrients in the body needs
compared to other types of bananas. It regulates blood circulation, reducing the risk of strokes,
regulating blood pressure and heartbeat. It is also a good source of vitamin B and minerals which helps
regain energy, reduce acidity in the body, helps cure ulcer and provides energy that last longer.
JKalinga’s Banana Chips is located in Purok 2, Bulanao, Tabuk City in front of Wanay’s Panciteria which
is very accessible area because it is along the road. The banana chips are packed by 25 grams in plastics
and are each pack is individually labeled. It provides a wide variety of premium quality chips with a
production process that uses primarily bananas and other ingredients which are all natural, no
preservative or additive. Each pack is well-sealed to maintain the product’s crispiness.
PRODUCTION PROCESS
Production of Banana Chips
Banana Chips or Crisps are deep fried snack - a small or casual snack. Cooking type bananas produce
good Chips/Crisps. It is easy to make and the product is very tasty. Good large size green cooking
bananas slices are cut cross wise to give circular shape. Bigger size fruits are preferred to produce
large size slices and an attractive product. Different varieties give products of different colour, flavour
and taste. Crosswise slicing gives uniform, circular, attractive, product and is universally adopted for
commercial production. This way as the slicing is faster the production increases.
The steps involved in Banana Chips processing are:
1.
Selection: Good quality, green cooking bananas is preferred. Saba or Cardava or “Dippig” in
Ilocano term is considered suitable for making chips.
2. Peeling: Using a hand peeler, bananas are peeled
1. Immersion in water: Immediately after peeling, the banana is placed in water. If slices are not
placed in water, they turn Brown and later give an unacceptable dark product.
2. Cutting/Slicing: Immediately sliced cross wise into thin, round slices.
3. Frying: Deep fry the banana in an oil until it is lightly cook. After being cook, taken out using
strainer to drain the oil and put in a wide aluminum tray and let it cool.
4. Soaking in water with sugar: Soak the lightly cook banana in a basin with sugar and small
amount of salt for about 5 minutes. Sugar gets in to the slices and improves taste arid
acceptability of the product.
5. Frying: Banana soaked are then dropped one by one manually into the hot oil in the frying
pan. Never put the slices together in clusters into the oil as the slices being starchy stick to
each other and are difficult to separate later. Slices are deep-fried to golden yellow colour
(till the bubbles seize) and taken out immediately using big perforated spoon or strainer.
6. Draining of oil: Deep fried chips are put into perforated Colander for the excess oil to drain
out and later transferred to a wide plastic or aluminum tray lined with craft paper or tissue
which absorbs/removes excess oil in chips and product is allowed to cool.
7. Packing: Chips should never be packed while hot since hot air inside the pack condenses into
water, which moistens the crisps resulting in soft, soggy chips. After cooling, chips are packed
manually in plastic pouches and scaled airtight using either Hacksaw blade over candle flame
or an electric sealer.
PROCESSING FLOW CHART
The JKalinga’s Banana Chips production process shall be as follows:
Raw
Materials
Inventory
Selection
Peeling of the bananas
Immersion in water
Cutting/Slicing
Frying
Soaking in water with sugar
Frying
Draining of oil
Packaging
Finished
Goods
Inventory
Price
Each pack of 25 grams of banana chips is priced at P5.00. The price of the JKalinga’s Banana Chips is
not greatly different from the price of the products of the competitors. Price is neither the competency
nor strategy of the proposed business. Furthermore, the main distribution links of the competitors are
the School canteens, grocery stores, convenience centers and pasalubong center. These stores will
sell the products at P6.00 to P8.00. JKalinga’s Banana Chips shall do direct delivery of products to the
school canteens and stores at P6.00. Both offer retail and wholesale. If wholesale, every bale (100 pcs)
at 5.50 pesos each or 550 per bale.
COSTING AND PRICING
UNIT
AMOUNT
Php)
Unripe green banana (big size) 100
pcs
200.00
Brown Sugar
1.5
kgs
70.00
Cooking Oil
1
ltr
80.00
Salt
2
tbls
2.00
Printed packaging sticker
200
pcs
160.00
Packing Cellophane
4
bags
200.00
ITEM
QTY
TOTAL COST OF PROD'N
712.00
Total Cost of Production
712.00
Add: 60% Mark-up
427.20
(In
1,139.20
Estimated Selling Price/Pack
(Total production cost plus
60% mark-up divided by 200
packs of 25g per pack)
1,139.20/200
packs
Php 5.00
Assumption: 100 pcs of bananas of about 10kgs can produce 200 packs at 25 grams each.
Place or Distribution
The delicious and healthy banana chips product will be distributed mainly to
canteens of the different schools in Kalinga. Since the business aims to make it known also to nonschool canteen customers, it will deliver to retail stores in some near retail stores of offices are also
targeted and also individual for own or family consumption. Cash collection shall be made on the
following delivery. Given that delivery shall be made daily, collection of the day’s delivery shall be
made on the following day. Collection from these non-school canteens and retail stores shall be made
on the next Saturday of delivery. This is to encourage these customers to buy and patronize the
proposed product.
Promotion
It plays an important role in the exchange process by informing customers of an organization’s product
or service and convincing them of its ability to satisfy their needs or wants. The business shall be
promoted by word of mouth, direct marketing, sales promotion and through personal selling efforts
of the business proponent. It can also be promoted through online social media which is in demand
now a days in marketing their products. Packaging and labeling will be enhanced more to further
promote the product.
Marketing Strategy
As this time JKalinga’s Banana chips is starting, we have to apply some strategy to grave the market.
To make the product acceptable and also to increase its acceptability we have to follow some
techniques. These can be:
• Selling the product with the low price than others.
• Provide better quality.
• Give free gifts with each packet.
• Can involve in some social welfare like scholarship, charity and donation.
• Sponsor in different cultural, educational or sports programs.
• Sampling in different places like in schools, colleges and also in other market places.
The strategies we follow in a combined way because:
1. Differentiation:
By bringing perfect taste,
we will make our product different from our
competitors. We will also improve the quality of our products. We will try to provide more
quality than our competitors do. Moreover, we will differentiate our product not only in taste
but also its packaging because we all are well known that packaging plays a great roll in
products selling. People, mostly children get attracted by colorful packet.
2. Mass marketing: We want to apply mass marketing theory. We are creating the best banana
chips by concerning not only children but also people of all ages. So that, we price our
products in different categories based on peoples need and wants.
Positioning
In all its activities, we are giving stress on
• Increased standard of customer service and care.
• A dedication to aid to all roles that human development plays in the aid process.
• Respecting each other as individuals and encourage to high performing work.
• Giving opportunities for personnel development.
• To prepare good relationship with suppliers and other supplement partners.
VI. FINANCIAL PROJECTION
• Projected Income Statements
The following income statements summarize the Sales, Cost of Sales and
Operating expenses of the business. The profitability report shows increasing annual sales and steady
operating expenses. Annual net income increases by 30% of 2022 and 50% of 2023.
JKALINGA'S BANANA CHIPS
Pojected Income Statement
(In Philippine Peso)
NOTE 2021
2022
2023
Sales
1
175,000.00
227,500.00
420,000.00
Cost of Sales
2
95,650.00
107,500.00
143,050.00
79,350.00
120,000.00
276,950.00
Gross Income
Less:
Operating
Expenses
Salaries Expense
3
21,000.00
21,000.00
21,000.00
Transportation Expense
4
3,600.00
3,600.00
3,600.00
Legal Fees
5
3,000.00
3,000.00
3,000.00
Depreciation Expense
6
6,115.00
6,115.00
6,115.00
Miscellaneous Expense
2,000.00
2,000.00
2,000.00
Total Operating Expense
35,310.00
35,310.00
35,310.00
Income before tax
44,040.00
84,690.00
241,640.00
Less: Income Tax (20%)
2,181.75
4,214.25
12,061.75
Net Income
41,453.25
80,070.75
229,173.25
NOTES TO INCOME STATEMENT
NOTE 1: PROJECTED SALES
2021
Product
Quantity
Price
Php)
(In Annual Sales
(In Php)
25 grams
35,000.00
5.00
Product
Quantity
Price
Php)
25 grams
45,500.00
5.00
Product
Quantity
Price
Php)
25 grams
84,000.00
5.00
420,000.00
2021
(In Php)
2022
(In Php)
2023
(In Php)
59,250.00
71,100.00
106,650.00
28,800.00
28,800.00
28,800.00
Manufacturing
Overhead (2b)
7,600.00
7,600.00
7,600.00
Total
95,650.00
107,500.00
143,050.00
175,000.00
2022
(In Annual Sales
(In Php)
227,500.00
30% increase
2023
(In Annual Sales
(In Php)
NOTE 2: COST OF SALES
Direct
Materials
Direct Labor
(2a)
NOTE 2a: DIRECT LABOR
Monthly
Annually
Cook
28,800.00
2,400.00
50% Increase
NOTE 2b: MANUFACTURING OVERHEAD
Quarterly
Annually
Gas Refill
1,000.00
4,000.00
Utilities
300.00
3,600.00
Total
1,300.00
7,600.00
NOTE 3: SALARIES EXPENSE
Monthly
Annually
Manager
1,000.00
12,000.00
Delivery man
750.00
9,000.00
Total
1,750.00
21,000.00
NOTE 4: TRANSPORTATION EXPENSE
Monthly
Annually
Transportation
300
3,600.00
NOTE 5: LEGAL FEES is 3,000.00 annually
NOTE 6: DEPRECIATION EXPENSE
Acquisition
Cost
Depreciable
Amount
Depreciation
Expense
Building
50,000*90%
45,000/20
2,250.00
Equipment
Kitchen
Utensils
3,800*90%
3,420/3
1,140.00
5,785*90%
5,206/3
1,735.00
5,500*90%
4,950/5
990.00
Furniture
Fixtures
&
Total
6,115.00
VII. SALES FORECAST
We predicted growth of thirty percent in the second year with sales exceeding expectations.
In year three, the product will run at maximum capacity and based on the current price of banana
chips, we expect excellent profits. We have positive indicators from current importers that the
additional amount of banana will be sold.
VIII. CONTINGENCY PLAN
Difficulties and Risks
• An entry into the market by an already-established market competitor
Worst-Case Risks
• Determining that the business cannot support itself on an ongoing basis
• Having to liquidate equipment or intellectual capital to cover liabilities
IX. CONTROLS
Marketing plan includes different kinds of budget and managerial assignment for every action
program. It describes how to implement marketing plan. For control purposes, the plan also allows for
yearly comparison of actual versus projected sales and expenses. If you cannot do this comparison
among the plan then never go to the competition. For better performance there is a need of
comparison between actual and projected income statement. If there find out any gap in plan and
output, we have to take corrective actions. Not only that, if there is any problem arise in production,
marketing process, or any other areas, we have to take necessary steps to overcome that. Finally, the
management will monitor the total environment, progress, and gap and will take corrective actions if
necessary. The JKalinga’s Banana Chips has to maintain total quality management (TQM).
X.CONCLUSION
The business has a market and will grow in the future. Its quality makes it unique and thus be
patronized by the target market. The target markets of JKalinga’s Banana Chips are school canteens
and retail stores. There are numerous schools existing and being put up and canteens of these schools
shall be the market of the business and at the same time its network of distribution links. The JKalinga’s
Banana Chips shall only be priced at P5.00, very affordable for school canteens who shall sell the same
products to students and other customers at mark-up of one to two pesos. Operationally, the
proposed business is viable.
Banana chips are easy to make and it does not require highly technical equipment.
The business also requires very minimum number of personnel to run and its
organization need not be complex.
Financially, it is feasible considering its low project cost and its profitability. Most importantly, the
business will contribute to the society by making available a
healthy product and employing unemployed individuals. It may start with only one, but when it will
grow, it will make a significant impact on the country’s workforce and in the society.