CASE STUDY TITLE: NATASHA (B)

I. POINT OF VIEW: Executive Committee of Natasha

II. OBJECTIVE/S
• To be able to increase the number of Natasha dealers.
• To be able to maintain and sustain the company’s growth
despite not being new in the market.
• To be able formulate strategies in expanding the company.

III. PROBLEM/S
Should Natasha prioritize its expansion through putting up
branches in regional areas such as Rizal (Region IV), Cebu
(Region VII), Davao (Region XI), iloilo (Region VI) and Dagupan
(Region I ) or should it expand in Metro Manila (NCR) first?

IV. AREAS OF CONSIDERATION

Natasha started as a retail shop (sells shoes, T-shirts, pants, wallets and bags) in 1994.

The company was selling well initially but sales plummeted because of the energy crisis and

“sawa” scare around the mall that Natasha decided to downsize its operations and venture in

wholesaling. Today, Natasha is a one of the successful Filipino networking companies engaged

in direct selling of its products. It has 500 employees who are guided by the following core

values: Customer Service, Discipline, Constant Improvement, Respect for Each Other and

Honesty.

Natasha has approximately 200,000 dealers, 80 % of which are deemed active. Dealers

and/ or members are given two options on to earn, Direct/ Personal Selling and Recruitment. In

direct selling, dealers can personally sell products with the use of the company catalouges and

purchase the products at a discount to sell them at a profit. In recruitment, dealers can earn a

commission on the sales of other dealers they have recruited.

V. TOWS MATRIX
THREATS
•High level of competition/ Increasing number
of competitors
•Majority of Natasha's competitors distribute
their products to resellers such as department
stores, drugstores, or cosmetic stores
•Customer preferences and demographics are
constantly changing
•Fraudulent Dealers/ Scammers
•Emergence of fraud companies
WEAKNESSES
•Costly selling and product delivery
•Difficulty in payment collection
•Difficulty in reaching wider audience as
potential customers due to lack of branches
•Low market share compared to bigger brands
•Cash inflows can be unpredictable or may
become bad debt losses
VI. ALTERNATIVE COURSES OF ACTION
1) The company will expand its operations in Metro Manila.
ADVANTAGES
•Save the company from incurring additional •Possibility of no to little/ less market with the
fixed overhead expense
•Will be cheaper to transport merchandise from
the central warehouse to the branches
•It is easier to monitor operations given their
proximity to the top managers
OPPORTUNITIES
•Retail location expansion
•Attract customers due to appealing way of
payment (Installment Basis)
•Attract potential dealers due to its high dealer
discounts and incentives
•Tapping into new markets and product lines
•Promoting self employment
•Uses Catalogues and delivers the product to
the customers which helps customers’ shop
and buy latest products in a convenient manner
•Adaptation to new technological advances
STRENGTHS
•Agreeable credit terms
•Affordable products
•Convenience of shopping at home
•Availability of high quality products
•High discounts on members and numerous
incentives
•Differentiated business model
DISADVANTAGES
increasing number of malls
2) The company will expand its branches in provinces.

ADVANTAGES DISADVANTAGES

•Huge possibility of new market •Costly

•No to little number of competitors •Needs more overhead
•If the branch is near the warehouse, deliveries •Difficult operations’ monitoring
can be made everyday

VII. CONCLUSION

Therefore, I conclude that the alternative course action two is the best solution to the
problem, which is to expand operation in key provinces.

VIII. RECCOMMENDATION

Natasha should expand outside Metro Manila because of competitors penetrating the
metro already. The expansion would create new demands and tap the target market which would
increase sales and build strong personal brand should they expand. Instead of fighting against
competitors in a shrinking profit- center market, Natasha should focus on creating a new pool of
profit- center market by branching out to places not yet explored by its competitors.

The executive committee of Natasha should conduct a meeting to discuss the necessary
actions to be taken in putting up branches especially in the key provinces mentioned. They
should plan the estimated budget for putting up a branch and entail help from a professional if
necessary. Hiring an operations manager will greatly help in the establishment of the branches
since he can take charge of the planning and implementation of the expansion plan. It would be
ideal to gradually expand and choose among the regional areas where to put up a branch first
rather than simultaneously putting up the branches. The company should also acquire
advertisements regarding the expansion to encourage new members to sign up and formulate
new promos to attract clients.