Sales Forecast

I’ce A Tea is a new mixed version of milk tea and ice candy whereas it offers a
variety of flavours. It can be availed with a price of Php10 or Php15. For every month,
the enterprise expects to gain to sell 500pcs for each price offered that will lead an
increase of the sales of the business. The sales will cover the cost that has been
incurred for the production of the products and will yield sufficient financial returns for
the enterprise. The enterprise projected that every year there is a 10% increase for the
sales, costs and income of the enterprise. The computation of the projected sales,
costs, and profit of the enterprise were presented below. Also, the graph was used to
show the growth of the enterprise starting from the projected monthly status up to the
projected status after 5 years.

35

30

25

20 Month

15 Year
After 5 Years
10

0
Sales Cost Net Income/Profit

Month
A. Cost 6824 + 700 = Php7, 524
B. Sales (500 pcs x 15 pesos) + (500 pcs x 10 pesos) = Php12, 500
C. Net Income/Profit 12500 – 7524 = Php4, 976
Year
A. Cost Php7524 × 12 = Php90, 288
B. Sales Php12500 × 12 = Php150, 000
C. Profit/net income Php4976 × 12 = Php59, 712
After 5 Years
A. Cost Php90, 288 × 1.1 × 1.1 × 1.1 × 1.1 = Php132, 190.66
B. Sales Php150, 000 × 1.1 × 1.1 × 1.1 × 1.1 = Php219, 615
C. Net Income/Profit Php59, 712 × 1.1 × 1.1 × 1.1 × 1.1 = Php87, 424.34

To ensure that this sales projection be possible and be achieved, the following
defensive and offensive strategies were formed. For defensive strategy, it is a
management tool that can be used to fend off an attack from a potential competitor.
Examples of defensive strategies are the edge features of the product, adding new
features or capabilities showing a positive and appealing way of countering a
competitive challenge; next is the advertising, a strong public campaign signifying
commitment to the market, assurance in the products, or a eagerness to meet the
competitor’s challenge; and lastly is to have exclusion to the enterprise, one way of
defending a position is to set up exclusive engagements with key suppliers in the
market. Such exclusive engagements can block the access of competitors to the
suppliers, sources or even partners. On the other hand, the enterprise also formed
offensive strategy which directly target competitors from which they want to capture
market share. Example of that is to have pre-emption to the business by means of that it
can secure relationships with the suppliers and it can also target and build relationships
with the customers. Also, for the defensive strategy, the enterprise is better than the
competitors business, although it is a new product; it can also keep pace with others.