V.

INTERNAL/COMPANY ANALYSIS

1. Revenue/sales in the past three years

Fiscal year is January-December. All 2016 2015 2014 2013 2012 5-year
values PHP Millions. trend

Sales/Revenue 12,699 11,982 11,010 10,240 10,99

8

2. How the companys growth compares with industry growth or vis--vis the other players

Capital
Revenue Revenue Net income Net income expenditure Dividend
(YOY change (5 yr growth (YOY (5 yr growth (5 yr growth (5 yr growth
Company %) rate) change %) rate) rate) rate)

Roxas and Co Inc -- -- -- -- -- --

Vitarich Corporation 48.06 13.59 144.00 -- -0.5903 --

AgriNurture Inc. -75.58 -24.02 44.70 -- -42.51 --

Central Azucarera de
18.57 1.98 22.50 2.67 7.70 --
Tarlac

Roxas Holdings Inc. 46.80 -- 834.68 -- -- --

Liberty Flour Mills Inc -24.78 -14.08 -20.30 -7.83 -16.56 --

Victorias Milling Co
6.32 4.73 -24.22 13.90 49.02 --
Inc

RFM Corporation 5.98 4.20 10.52 14.48 -18.96 --

San Miguel Pure

4.42 4.49 35.66 9.23 33.10 7.39
Foods Co. Inc.

Century Pacific Food

21.28 -- 37.33 -- -- --
Inc

3. Profitability, other relevant performance indicators

Gross margin Net Profit margin

Company Gross margin (TTM) (5 yravg) Net profit margin (TTM) (5 yravg)

Roxas and Co Inc 35.34 -- -45.81 --

Vitarich Corporation 12.29 9.95 1.19 -6.40

AgriNurture Inc. 13.96 14.27 -28.92 -26.30

Central Azucarera de Tarlac 41.21 34.84 17.55 7.75

Roxas Holdings Inc. 11.33 15.94 1.21 4.46

Liberty Flour Mills Inc 28.87 30.55 -1.38 15.95

Victorias Milling Co Inc 30.37 36.94 11.08 16.04

RFM Corporation 41.59 36.98 7.95 7.37

San Miguel Pure Foods Co. Inc. 23.81 20.68 5.78 4.43

Century Pacific Food Inc 28.60 -- 8.82 --

4. Applicable Financial Ratios

Payout ratio
Company Quick ratio (MRQ) Interest coverage (TTM) Total debt to capital (MRQ) (5 yravg)
Roxas and Co Inc 0.5593 -- 0.3494 --

Vitarich Corporation 0.8028 11.32 0.0879 --

AgriNurture Inc. 0.7071 -2.58 0.5754 --

Central Azucarera de Tarlac 0.8071 3.20 0.4781 0.00

Roxas Holdings Inc. 0.3607 0.8725 0.5316 22.30

Liberty Flour Mills Inc 10.95 -- 0.1786 51.75

Victorias Milling Co Inc 1.49 -- 0.274 --

RFM Corporation 1.18 -- 0.0272 --

San Miguel Pure Foods Co. Inc. 0.705 754.11 0.0837 --

Century Pacific Food Inc 1.21 48.32 0.1476 --

5. Value Chain Analysis

B. Do an Organization Diagnosis using:

1. Davids functional audit to assess the different functional areas of the organization

Under the following Davids functional audit to assess

a. Risk Management
The Groups principal financial instruments include non-derivative instruments such as cash
and cash equivalents, AFS financial assets, accounts receivable, accounts payable and accrued
liabilities and advances to and from related parties. The main purpose of these financial instruments
includes raising funds for the Groups operations and managing identified financial risks. The group
has various other financial assets and financial liabilities such as other current receivables, other
current assets and customers deposits which arise directly from its operations. The main risk arising
 from the use of financial instruments is credit risk, liquidity risk, interest rate risk and foreign
exchange risk.

Credit risk

Credit risk arises from the risk of counterparties defaulting. Management is tasked to
minimize credit risk through strict implementation of credit, treasury and financial policies. In
additional, the Group transacts wit financial institution belonging to the top 25% of the industry,
and/or those which provide the Group with long-term loans and/ or short-term credit facilities.

Financial assets that are neither past due nor impaired are classified as Excellent account when
these are expected to be collected or liquidated on or before their due dates, or upon call by the
Group if there are no predetermined defined due dates.

Liquidity risk
Liquidity risk arises from the possibility that the Group may encounter difficulties in raising
fund to meet commitments from financial instruments.

Management is tasked to minimize liquidity risk through prudent financial planning and execution to
meet the funding requirements of the various operating divisions within the Group; through long-
term and short-term debts obtained from financial institutions; through strict implementation of
credit and collection policies, particularly in containing trade receivables; and through capital rising,
including equity, as may be necessary. Working capital requirements, on the other hand, are
adequately addressed through short-term credit facilities from financial institutions. Trade
receivables are kept within manageable levels.

Interest rate risk

The Groups exposure to changes in interest rates relates primarily to the Groups short-term
and long term debt obligation.

Management is tasked to minimize interest rate risk by having a mix of variable and fixed
interest rates on its loans. Presently, the Groups short term and long term debts and obligations are
market-determined, will the long term debts and obligations interest rates based on PDST-F-1 plus a
certain spread.

There is no other impact on the Groups equity other than those affecting the statement of
income.

Market risk

To address these competitive pressure the company continues to develop new product
development and improving its packaging formats to hold on its own consumers and to increase
market share. And in such risk they develop and established a system where success indicator in the
target market are closely monitored and supported by effective supply chain management.

B. PROCESS AND CONTROL

2. McKinseys 7S Model or Galbraiths Star Model

1. Strategys

Long Term Market & Product Forecast, Consumption Forecast, Long Range Forecast for
Products, Product Growth, and Factors for Profitability.
 MARKET ENVIRONMENT: Growth, Structure, Service, Customers.

THE PRODUCT: Life Cycles, Market Share, Product Quality, Product range, Profitability, Pricing,
Service Quality, New Products.

COMPETITION: Market Share, Profitability, Competition, Market.

THE INDUSTRY: Industry Growth, Costs, Capacity, Productivity, Labor, Unionization, Capital
Structure, Investment, Margins, Integration, Marketing costs, Process, Distribution, Market
Penetration.

MEDIUM + LONG TERM STRATEGIES: Build, Hold or Harvest

MEDIUM + LONG TERM CHECKLIST: Profitability, Productivity, Market Shares, Customers, Sales
Promotion, Product Availability, Competence, Products, Quality, Pricing, Competitors, Performance,
Service, Customer Base, Costs & Margins, Distribution Channels, Forecast of Financial + Operating
Data.

MEDIUM + LONG TERM CHECKLIST recommends a working plan or document for the critical
factors which influence the Target Company in strategic terms. The data is given as a matrix by
Subsidiary, Division, Unit or Market sector.

CRITICAL LONG RANGE FORECASTS: Long Term Market & Product Forecast
- Overall Market Forecast for the Industry - Long Range Country / Trade Cell Forecasts
- Long Term Product Growth for the Target Company

THE LONG-TERM MARKETS: The Market section consists of a LONG-TERM MARKET

CONSUMPTION forecast giving data for each year from 2018-2028. Market Consumption & Market
Trend figures are given: - by EACH COUNTRY / STATE / REGION by EACH PRODUCT Group and/or
MARKET by YEAR 2018-2028

.
Strategic Report on R F M Corporation

Substantial interest, recent commentary and overall performance speculation persuaded

Data Group Analysts to publish the new edition of the Tactical & Strategic Report on R F M
Corporation - NEW EDITION now available. The New Edition of the report represents a complete re-
evaluation, re-assessment and re-formulation of the last edition. The results are extensive, far
reaching and essential research for all those searching for highly sophisticated Tactical & Strategic
information on R F M Corporation.

The Tactical & Strategic Report on R F M Corporation has the following coverage:-

Report Contents:- The report has three main constituent parts, the Corporate data, the
Market Research data, and the Business Planning tools. In addition there is a host of reference
information provided.

Corporate Coverage:- The report covers the main Subsidiaries, Divisions & Geographic
Market areas of R F M Corporation.

Product Coverage:- The report covers the major Product Groups and Product Areas of R F M
Corporation.
 Market Coverage:- The report covers up to thirty Market Areas, Product and Market Sectors
for R F M Corporation.

Geographic:- The report covers Company home markets plus fourteen other important
national markets within the trade cell. Also covered are the Regions or States within each country.

Time Series:- The Report covers both Historic and Forecast data. The Historic data covers
the previous 3-6 years and the Forecast data is presented in two time series, being: a Medium-Term forecast
for the next 7 years and a Long-Range projection for each year to 2028 or 2034.

2. Structure
RFM Corporation operates in the Prepared flour mixes and doughs sector. In addition to
historical fundamental analyses, the complete report available to purchase compares RFM
with three other bakery and confectionary companies in Asia: Woo Sung Feed Company
Limited of South Korea (2016 sales of 275.67 billion Korean Won [US$245.07 million] of
which 99% was Feed), First Baking Co., Ltd. of Japan (26.69 billion Japanese Yen
[US$243.71 million] ), and Usher Agro Limited which is based in India (16.13 billion Indian
Rupees [US$251.97 million] of which 97% was Food Processing).
3. System

Food and beverage giant RFM Corp. has tapped SAP Philippines to implement
enterprise resource planning solutions for its subsidiary, Swift Foods with the
goal of developing a superior sales, logistics and distribution system.

Jose Concepcion III, RFM president and chief executive officer, explained that
Swift Foods will be the main vehicle for distributing food and beverage
products or consumer products of RFM and its subsidiaries so there will be one
sales and distribution group for the whole RFM organization.

"We believe in technology and how it can enhance critical business processes
like generating timely and accurate information at all levels needed for a
seamless supply chain system and in enhancing greater productivity in all our
operations. We therefore put into reality our intention to leverage technology
to position ourselves competitively in the new millennium," he said.

According to Concepcion, the company's investment in SAP's enterprise

technology is expected to impact greatly on their ability to track, analyze and
respond to movements, costs and trends in existing and new product categories,
existing and new accounts and channels of distribution and changes in
geographical coverage.

4. Style
The Company's segments include institutional business and consumer business. The
Institutional segment primarily manufactures and sells flour, pasta, bakery and other bakery
products to institutional customers. The Consumer segment manufactures and sells ice
cream, meat, milk and juices, pasta products, and flour and rice-based mixes. The Company's
branded products include White King, Fiesta, Sunkist and Selecta. The Company's food
businesses include Unilever-RFM Ice Cream Inc. and Engrain-RFM Pacific Inc. (ERPI). Its
non-food businesses include RFM Equities, Inc. and Invest Asia Corporation

Technological Analysis- The RFM Foods Corporation use the best and the most advance way
to produce and provide a high quality product to its consumer.
 5. Shared value
The RFM Foods Corporation will provide the community with affordable-quality food.
RFM Foundation, Inc. is the social development arm of the RFM Corporation and headed by
Joey Conception, Jr. Among its notable projects are Ten Outstanding Students of the
Philippines and Go Negosyo.
The Ten Outstanding Students of the Philippines desires to honor students who made
excellent academic performances and their contributions to society.
Go Negosyo is the advocacy of the Philippine Center for Entrepreneurship, a non-stock, non-
profit organization that advocates poverty alleviation through entrepreneurship. RFM
Foundation also donated P2 million for Piso Para sa Kinabukasan headed by ABS-CBN Bayan
Foundation, Inc.
6. Staff
The typical day in this company is fun and exciting. It has a good working environment and
you will learn a lot based from the experiences of the supervisors and other people who's
been working too long in the company. They are willing to share their knowledge and
promote professional growth on the people.

The management managed the people efficiently and effectively

7. Skills
The value of what we do for our clients depends on giving our people the platform to achieve
their own aspirations.
Talent and passion of our people is critical to our success. Together, we share a common set of
values rooted in integrity and excellence. RFM Foods Corporation can provide a superior
foundation for building a professional career a place for people to learn, to achieve and to
grow.

C. From the above, identify the companys major strengths and weaknesses

Major Strengths

HAVING A EMPLOYEE EMPOWERMENT that would boost the capabilities of every

employee.
HAVING A CUSTOMER CARE that have been thoroughly practices for decade by
developing products in affordable price,
HAVING USE OF DEVELOPE TECHNOLOGY IN PRODUCING A PRODUCT THAT ANSWERS
THE NUMBER OF CUSTOMER THAT SUPPLIED TO.
HAVING A COMPASION TO HIS SOCIETAL ENVIRONMENT INHELPING HIS PEOPLE AND
LEADING ITS MISSION FOR A CARE TO HIS EMPLOYEE

Major Weaknesses

having a weak in terms of marketing compremecy

having a blurred acquisition of strategic plan
and having a strong competitors in the market
and too narrow product line
D. Use the IFE Matrix to evaluate the overall internal Strengths and Weaknesses of the company

Internal Factor Evaluation Matrix (IFEM)

I. Statement of the Problem
Lack of Marketing Strategies to Promote Products in the Market
Sub Problems:
To be the biggest and number one diversified food and beverage companies that supply the local and
international market.
To influence customers and penetrate the market.
To widen and strengthen the companies tie up with its existing partners.
To generate and increase revenue and lower the cost and lower the receivables and increase cash available.
Development made by competitors in means of marketing and selling strategy.

E. Summary and Conclusion

1. Identify the major financial and internal strategic issues that the company must address

Enables the company to collect its receivables in shorter time or make money out of it.
Allows on time delivery, avoid too much inventory that allows to lessen damage and perish products,
and decrease cost on warehousing since only needed supply will be available. The plan also allows
strong and tight relationship to suppliers, creates also assurance.
2. Identify key organizational elements that may hinder or promote growth and productivity.

Marketing and Promotional Strategies will help to influence and enhance brand awareness of
customers about the product. It also allows the company to compete in competitive world of food and
beverages companies.
Acquiring, licensing agreement and building strong alliance will help to widen and strengthen
companies capability to compete. It also means more product line up available for customers and
more potential to serve the wide variety of customers because of wider product choices available

VI. Strategy Formulation

A. Use the different formulation tools (SWOT, SPACE, BCG, IE, GE/McKinsey, GRAND and QSPM) and
other relevant analytical and matching tools to come up with strategic options and directions for the
company. Explain the results of your analysis.

SWOT ANALYSIS

STRENGHTS

Strategic Partnership , acquisition ,and licensing agreements.

Leading Brand

Conglomerate Strategy Implementation

High Quality Product Produce

Employee Empowerment

WEAKNESSES

Weak Marketing Skills

No clear strategic direction

Large amount of Receivables

Strong Market Competition

Too Narrow Product Line

OPPORTUNITIES

Wide connection

Quality product can compete to international market

Serve large group of customers and variety of product available. Market Penetration

Increase value of products to the market

Increase production capability

 THREATS

Slow brand recognition

Slow economic growth

Large amount of company money is sleeping and unprofitable

Lesser opportunity to penetrate the market

Limited market holdings

BCG MATRIX

IE for RFM Corporation

 Strategy Use:
Horizontal Diversification
Conglomerate Diversification
- Acquisition
- Licensing Agreement
BCG Matrix
- Joint Venture
Competing Product Line
Strategy Use:
Strategy Use:
Vertical Integration
Vertical Integration
Forward and Backward Integration
Forward and Backward Integration
- Product Development
- Product Development
- Market Penetration
- Market Penetration

SPACE MATRIX COORDINATES:

X axis: CP+IP; -3+3.57= .57
Y axis: SP +FP; -3+4.5= 1.5

This particular SPACE matrix tells us that the RFM FOODS Corp[oration should pursue an aggressive strategy.
Our company has a strong competitive position it the market with rapid growth. It needs to use its internal
strengths to develop a market penetration and market development strategy. This can include product
development, integration with other companies, acquisition of competitors, and so on.

Developing Courses of Action

Alternative Courses of Action:

1. Continuous Forward Integration
2. Development of Marketing and Promotional Strategies
3. Forecasting & JITD and Strategic Dealing with Suppliers (Contract Signing)
4. Accounts Receivable into Note
Alternative Courses of Action 1:
Alternative Courses of Action 3:

ADVANTAGE ADVANTAGE
Widening Market Space Avoid large inventories, avoid perished product,
Stronger Alliance less cost in warehousing.
Increase Global and Local Influence Assurance of supply from Suppliers

DISADVANTAGE DISADVANTAGE
Investment Cost Exact product will be delivered.
Diversity of Companies Property Doesnt allow deduction if cost of purchases
decreases.

Alternative Courses of Action 2: Alternative Courses of Action 4:

ADVANTAGE ADVANTAGE
Grows revenue Possibilities to make Cash and Interest out of
Enhance Brand Recognition and Customer Receivables.
Awareness
Create Opportunity to Compete and Communicate DISADVANTAGE
to Customers Lower Transaction with Co-Distributors.

DISADVANTAGE
Investment Cost

B. Make sure that your analysis and positioning in the various matrices/cells are consistent with the
results of your external/industry and company analyses.
C. Do a summary and prioritization of the various strategies derived from the various tools. Select the
strategic that you will adopt to attain your objectives, and ultimately, your vision.

Summary and Prioritization of the various strategies

The plan of action should be SMART:

Specific
Measurable
Attainable
Reasonable
Time-bound
Efficacy
Realistic

1. PLAN OF ACTIONS:
Continuous Horizontal Diversification- Deal with companies with competitive product that gives
customers need and surpass competitors advantage (Differentiation). Create a contract for assurance
and legalities.
Strong Marketing and Promotional Strategies- The following actions are suggested
1. Active social media campaigns Facebook, Twitter, Instagram and etc. That provide quality
information about the company and should contain topics that creates readers curiosity top read it
(like about healthy tips, jokes, helpful ideas or topic about love in relation with our product) and
should contain pictures of company related products or pictures.
2. In time TV ads, ads should be time-bound and efficient.
3. Create a policy about receivables that if the amount will be receive in a long time it should be a note
that accumulate interest
4. From last actual sales the company will estimate the needed supply considering the time/event or
reasons.
5. The supply will be delivered on time specified.
6. Conduct contract signing for safeties of supply will be available.