University of Cebu-Banilad Campus

College of Business Administration and Accountancy

C. SITUATIONAL ANALYSIS

A. ENVIRONMENTAL ANALYSIS

POLITICAL
The Republic Act No.7721, this law allows operations of foreign banks in the Philippines. In
addition, several investors are willing to invest in the Philippines for the preparation for the upcoming
ASEAN integration. However, this I a threat to URC because it is possible that the new and businesses
and competitors will be present in the Philippine market industry. Moreover, the change in Legislation
and taxation effects on the company. In every single business that operates nowadays has a responsibility
and has the obligation to pay for taxes. The achieve success in the business industry, before entering or
investing in a particular industry, the foreign industry in different countries diversifies the systematic
threats of the political climate by closely analyzing the regulatory factors. To prevent controversies, the
corporation is required to obey government regulations such as the Legal Structure for Contract
Compliance.

ECONOMICAL:
The aggregate demand and aggregate investment in an economy are determined by environmental
variables such as inflation, savings rate, interest rate, foreign exchange rate, and economic cycle. So,
URC can use country’s economic factor such as growth rate, inflation & industry’s economic indicators.
The cost of business production has also risen, forcing the company to raise its prices.

SOCIO-CULTURAL:
These companies are also aggressive in creating and innovating products and introduce to the
media by creating several advertisements campaigns for the products to blend to the market industry and
customers will be able to know what are the new made products that this company introduce, by this
become a new trends to the society. In addition, through this platform it creates brand awareness to the
have a great impact to the organization.

TECHNOLOGICAL:
 The demand for machine automation has been increasing from day to day as part of their
innovation and transition from human labor capital. To add, while human labor is abundant to the
different organizations several companies wants to establish a more efficient way in producing their
products and to know their purpose why to invest more in different machineries and equipment which
helps enhances their productivity. Further, Universal Robina Corporation is currently the sole company
that has certified BOPP (Bi-axially Oriented Polypropylene) plant and equipment located in Batangas.
these machineries coverts resin materials into BOPP films that is used in packaging their products which
helps prolong the life of their food products.
ENVIRONMENTAL
One of the common issues today is the climate change and it has been an issue with regards
sustaining the environment, especially for businesses that operates foods and others that their packaging
uses plastic materials and others, as they try to continue their operations while being environmentally
friendly at the same time. Due to this, the products from the different companies that is use
“environmental-friendly” methods of production became a marketing tool to increase and boost sales of
the organization.
LEGAL:
Legal issues can also have an effect on business and how a corporation operates. Businesses are
impacted by a variety of legal factors, including taxes, jobs, contracts, securities, immigration, and more.
The law has an impact on how companies work and how consumers act. Further, the legal system and
institutions in a number of countries are insufficient to secure an organization's intellectual property
rights. Before entering such markets, a company should carefully consider its options because it could
result in the theft of the company's secret sauce, reducing its overall competitive advantage.
 CONFLICT OF INTEREST
The Company's Code of Business Conduct and Conflict of Interest Policy require employees to make a
conscious effort to avoid conflict of interest situations; that his judgment and discretion is not influenced
by considerations of personal gain or benefit. A conflict of interest may also occur because of the actions,
employment, or investments of an immediate family member of an employee.
 CONDUCT OF BUSINESS AND FAIR DEALINGS
The Company's employees that recommend, endorse, or approve the procurement or sale of goods and
services should make a conscious effort to avoid any conflict of interest situation in transactions that they
are involved in.
 RECEIPT OF GIFTS FROM THIRD PARTIES
The Company allows the acceptance of gift only during the Christmas Season. There is no restriction in
the value of the gift accepted. However, accepted gift with estimated value over PHP 2,000 must be
disclosed to the Conflicts of Interest Committee.

 COMPLIANCE WITH LAWS AND REGULATIONS

The Company ensures that all transactions comply with relevant laws and regulations. Any deficiencies
are immediately rectified.

 RESPECT FOR TRADE SECRETS/USE OF NON-PUBLIC INFORMATION

The Company has policies that ensure proper and authorized disclosure of confidential information.
Disclosures to the public can only be done after disclosure to the SEC and PSE by the Company's
authorized officers.

 USE OF COMPANY FUNDS, ASSETS, AND INFORMATION

Employees are required to safeguard Company resources and assets with honesty and integrity.
Employees must ensure that these assets are efficiently, effectively, and responsibly utilized.

 EMPLOYMENT AND LABOR LAWS AND POLICIES

The Company's Human Resources Unit ensures compliance with employment and labor laws and
policies.

 DISCIPLINARY ACTION
Violation of any provision of the Code of Business Conduct may result to disciplinary action, including
dismissal and reimbursement for any loss to the Company that result from the employee's action. If
appropriate, a violation may result in legal action against the employee or referral to the appropriate
government authorities

B. KEY FACTORS FOR SUCCESS

Universal Robina Corporation is one of the largest and leading food and beverage companies.
URC positioned itself in the market and successfully exported its products internationally. Mr.
John Gokongwei, Jr. the founder of URC created his own diversified products. The key to the
success of the company is its strong brands and continuous product innovation. URC did not
 neglect the power of innovation and keep on producing products that will satisfy the consumers’
needs and would be relevant to the trend nowadays.
Moreover, the company won’t be successful just because of the product alone but also
because of the unswerving efforts that the founder is putting on the business. Mr. John
Gokongwei, Jr. started the business as a corn milling plant then, later on, started producing coffee
blends, poultry products until it expanded and became a manufacturer of food and beverages in
the industry. Tracking down its success story, Mr. Gokongwei has this positive mindset and the
greatest determination to continue creating and innovating products at their finest. The vision that
he has for his company helped him to strive more and compete with other growing businesses in
the country.

C. Strengths and Weaknesses Analysis

Strengths
 Strong market position – Universal Robina Corporation is already established company and is
known globally and internationally. Hence, they already created a room to the consumer’s mind.
 High revenue growth rate – The company has high growth rate due to the products that they are
offering to the market. Foods and beverages are very essential in every person and is consumed
daily thus, food and beverages consumption will keep on increasing and would help the company
in terms of its expansion plans.
 Broad Product Portfolio – URC provides the consumers several products that they could choose
from. URC is a food and beverages company that offers snacks, biscuits, chocolates, coffee,
juices, water, noodle, pasta and many more.

Weaknesses

D. Opportunities and Threats

Opportunities
 Increase in Global Food and Beverage Consumption – As the population keeps growing the
food and beverage consumption will keep on increasing which will lead the company to produce
more in order to satisfy the increasing demand of the consumer.
 New market ventures
 Threats
 Change in Consumer Preferences – Consumer preferences varies with differently. Other
companies could respond to certain changes in consumer preferences that could either be due to
the latest trends. If the company won’t be able to adapt the changes, then it would be a threat and
could the affect the company’s operations.
 Economic slowdown

E. Market Segmentation
For the company to serve the customers the best way as possible, it should divide its
market into different segments. URC has different ways of segmenting their market and these are
the following:
Demographic Segmentation
Demographic segmentation is a way of segmenting the market based on demographic
factors such as age, gender, income, race, religion and other demographic factors. URC has been
using demographic segmentation to segment their market and it was determined that ages
between 10-45 years old both male and female are their product consumers. URC’s products are
available in variants that people with in all income levels could afford. There were fun snacks that
are in “tingi” and beverages in different sizes which is delightfully affordable for many people.

Geographic Segmentation
Geographic segmentation divides the market according to its location and geographic
units. URC is a multinational company which means it does not solely operate in the Philippines.
URC has reached ASEAN countries and Oceania. Some brands were also exported and produced
to different parts of the world with different flavors of snacks and beverages.

Psychographic Segmentation
Under psychographic segmentation, it divides the market according to social class,
lifestyle or characteristics. URC as one of the largest and leading Food and Beverages Company,
those who are brand conscious will always prefer URC product brands than any other.

Behavioral Segmentation
 Behavioral segmentation is another way of segmenting the market based on product
usage and attitude towards the brand.