EXTERNAL ASSESSMENT

3.1. BUSINESS ENVIRONMENT ANALYSIS

Using PESTEL Analysis, the group has identified the following external factors that affect the

position of DAVECO Agrarian Reform Beneficiaries Cooperative, to wit;

 POLITICAL – threats of terrorism, political stability, interference of the government with

cooperatives

 ECONOMIC – investment scams, inflation rate, business cycle stage

 SOCIAL – payment behavior of members, demographics and skill level of members

 TECHNOLOGICAL – systems and processes, technological impact on product offering

 ENVIRONMENTAL – LGU’s ordinances to ban use of plastic and proper waste

management

 LEGAL – Memorandum of Agreement between cooperative as creditor and debtor;

contract with areas under Comprehensive Agrarian Reform Program (CARP)

3.2. INDUSTRY ANALYSIS

Threats of New Entrants

Buyer Power
Ease of organizing and
Loan availment of members
management as supported
by the Cooperative Code of
the Philippines (RA 6938)

Ease of producing and

marketing of similar
products

Competitive Rivalry

Interest rate competition

Loan approval process

Threat of Substitute
Supplier Power
Products
Availability of member’s
Existence of other
contribution for share capital
cooperatives/financial
institutions offering a lower
interest rates on loans

Other popular brands of the

same products
3.3. OPPORTUNITIES AND THREATS

 OPPORTUNITIES

o Consider investing in market securities

o Increase in market share for pineapple products

o Market’s preference for processed fruits with its image of convenient yet healthy

eating

o Continued support from the government and Del Monte Corp.

 THREATS

o Investing in scams

o Brand for pineapple products lacks popularity among major players in the food

industry

o Overdependence to DAVCO and Del Monte Corp.

o Withdrawal of membership from the cooperative

3.4. KEY SUCCESS FACTORS OF THE INDUSTRY

 Strategic Focus -

 Personnel

 Operations

 Marketing

 Finances
3.5. EXTERNAL FACTOR EVALUATION (EFE) MATRIX

EXTERNAL FACTOR WEIGHT RATIN WEIGHTED

G SCORE
OPPORTUNITIES
1. Investment in market securities 10% 3 0.30
2. Increase in market share for pineapple 20% 4 0.80

products
3. Continued support from the government 8% 3 0.24

and Del Monte Corp.

4. Market’s preference for processed fruits 15% 4 0.60

with its image of convenient yet healthy

eating
THREATS
1. Investment scams 7% 3 0.21
2. Lesser popularity than major players in 15% 4 0.60

pineapple products industry

3. Overdependence to DAVCO and Del 10% 3 0.30

Monte, Corp.
4. Withdrawal of membership from the 15% 3 0.45

cooperative
TOTAL 100% 3.5

Legend: poor = 1; below average = 2; above average = 3; superior = 4

Total weighted score of 3.5 indicates that the business has an above average ability to respond

to external factors.

4.6 COMPETITIVE PROFILE MATRIX

 A credit and savings cooperative that ventured to production of processed pineapple

food is not a business concept solely used by DAVECO. One cooperative with this

business concept is Labo Progressive Multi-Purpose Cooperative (LPMPC) which is a

money lending cooperative based in Labo, Camarines Norte. It has ventured into

production of pure pineapple juice, pineapple jam, dried pineapple and pineapple fiber.

Its most popular product is the pineapple juice drink labelled as Queench which the

cooperative supplies to various schools in Bicol, under the Department of Education’s

“Healthy School Canteen” Advocacy. With the support of Philippine Rural Development

Project (PRDP) enterprise namely, “Camarines Norte Pineapple Trading and Processing

Project,” it can produce up to 1,000 boxes per day.

The table below compares DAVECO and LPMPC in terms of key success factors.

Labo Progressive
Multi-Purpose
DAVECO Cooperative
(LPMPC)
Key Success Factor Weight Rating Score Rating Score
Strategic Focus .20 4 0.80 4 0.80
Personnel .20 3 0.60 3 0.60
Operations .20 3 0.60 4 0.80
Marketing .15 2 0.30 3 0.45
Finances .15 3 0.45 3 0.45
Total 1.0 2.75 3.1

LPMPC has a total score of 3.1 while DAVECO has a total score of 2.75. since LPMPC has the

higher score among the two, then LPMPC is relatively the stronger brand.