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Laran Operations Strategy
Laran Operations Strategy
Beauty ‘n Health Madness is a retailing store that focuses on buying and selling Food and Drug
Administration (FDA) approved beauty and health products. It will not sell illegitimate products
because customers’ safety is its prime concern. Since beauty and health industry have been
showing explosive growth nowadays, especially among young and middle- aged members of the
community, the venture’s target clients, the proprietor has seen an opportunity to put up a venture
upon the knowing that a new shopping mall will be instituted within the area of Maasin City.
The store will offer various legitimate beauty and health products coming from various suppliers.
Accordingly, it is to be noted that the store will not be limited to the products listed since in
health and beauty industry, innovators and manufacturers will introduce many new products in
the market from time to time. As new products are offered in the market, Beauty ‘n Health
Madness will also adjust to the changes for its benefit depending on the market demand and
supply considerations.
Beauty ’n Wellness Madness’ mission is to supply FDA approved beauty and health products
that enhance our clients' physical appearance, self-confidence and overall well- being. To be
consistently dedicated in providing high customer satisfaction by rendering excellent and quality
products, and furnishing an enjoyable atmosphere at an acceptable price/ value relationship.
The main competitive advantage of the store is its location. It will be located in the largest
shopping mall of Maasin City which will surely be patronized not just by the Maasinhons but
also by other neighboring municipalities.
Currently, it is noticeable that there are now stores in Maasin City that offers beauty and health
products but in Beauty ’n Wellness Madness, customers are secured that its products are
legitimate and FDA approved which are acknowledged not just nationwide but even worldwide.
Customers can also trust that the stores products provide professionally proven lasting effects.
In Maasin City, there are a number of strong competitors offering various beauty, health and
wellness products. They are the following:
Metro Hypermarket
Lykinia’s Boutique located at Tunga- tunga, Maasin City
Beauty in the City located at Combado Maasin, City
Drugstores like: Watsons, Mercury Drug, Rose Pharmacy, and Luz Pharmacy
Various small boutiques offering health and wellness products and online resellers.
However, it must be noted that due to variety of products that emerged in the market, the products
offered by the above-mentioned competitors may not be exactly the same as those offered by
Beauty n’ Health Madness but may offer similar/ almost the same benefits.
The strengths of the competitors include:
Established business name
Brand name of the products offered are already recognized in the market
Nationwide advertisement of products offered
Pricing
The prices of the products offered by Beauty ‘n Health Madness will depend on the
suggested retail price (SRP) of the specific product in the market. Suppliers and
distributors are strict on price set-up by their retailers. A retailer should not go below
the suggested retail price so that competition in the market will be not be out of
control. A retailer can still set-up his own product prices given into consideration the
different value adding costs such as the freight and the like provided that he will not
offer that products below the SRP. Beauty ‘n Health Madness product costing is
presented in Table 1:
REJUVENATING SETS
Brilliant Skin Essentials Beauty Sets A.0001 Box 210.00 3.00 213.00 300.00 87.00 41%
Fairy Skin Facial Sets A.0002 Box 210.00 3.00 213.00 300.00 87.00 41%
Skin Magical Beauty Sets A.0003 Box 200.00 3.00 203.00 250.00 47.00 23%
Cosmetic Buffet A.0004 Box 210.00 3.00 213.00 300.00 87.00 41%
Ryx Skincerity Beauty Kits A.0005 Box 400.00 3.00 403.00 450.00 47.00 12%
Prestige International Beauty Sets A.0006 Box 210.00 3.00 213.00 300.00 87.00 41%
Glutax 5Gs Beauty Sets A.0007 Box 200.00 3.00 203.00 250.00 47.00 23%
Yasuy Set A.0008 Box 210.00 3.00 213.00 300.00 87.00 41%
CREAM/LOTION/POWDER
Vitamin E Moisturizing Cream B.0001 Jar 180.00 3.00 183.00 250.00 67.00 37%
Vitamin E Gluta fresh milk lotion B.0002 Pack 200.00 3.00 203.00 280.00 77.00 38%
Unit Value Mark-up
Unit of
Product Description Stock No. Purchase Average Cost of Suggested
Measure Amount Percentage
Price Freight-In Goods Sold Retail Price
Vitamin E powder B.0003 Box 180.00 3.00 183.00 250.00 67.00 37%
Vitamin E facial wash B.0004 Box 280.00 3.00 283.00 380.00 97.00 34%
Glutax lotion B.0005 Bottle 200.00 3.00 203.00 250.00 47.00 23%
Daphnie Summer wild lotion B.0006 Bottle 200.00 3.00 203.00 250.00 47.00 23%
Glutamansi lotion B.0007 Bottle 160.00 3.00 163.00 200.00 37.00 23%
Fairy Skin lotion B.0008 Bottle 400.00 3.00 403.00 450.00 47.00 12%
Navarro's Bleaching lotion B.0009 Jar 380.00 3.00 383.00 600.00 217.00 57%
SOAP
Vitamin E soap C.0001 Pack 120.00 3.00 123.00 180.00 57.00 46%
Dermablend Cleansing milk C.0002 Bottle 180.00 3.00 183.00 200.00 17.00 9%
Daphnie Bleaching Soap C.0003 Box 200.00 3.00 203.00 250.00 47.00 23%
Navarro's Bleaching Soap C.0004 Box 250.00 3.00 253.00 400.00 147.00 58%
Glutax Soap C.0005 Box 120.00 3.00 123.00 180.00 57.00 46%
Soaplada Stunning White C.0006 Box 210.00 3.00 213.00 280.00 67.00 31%
Soaplada Brilliant Bar C.0007 Box 150.00 3.00 153.00 200.00 47.00 31%
Yasuy Bleaching Ultimate Soap C.0008 Box 250.00 3.00 253.00 300.00 47.00 19%
SHAMPOO
Aloe Grow D.0001 Bottle 300.00 3.00 303.00 380.00 77.00 25%
Kineza Hair Grower D.0002 Bottle 200.00 3.00 203.00 230.00 27.00 13%
FEMININE
WASH/PADS/LUBRICANTS
Pinky Secret Feminine wash E.0001 Bottle 100.00 3.00 103.00 150.00 47.00 46%
Lean 'n Green Happy pads E.0002 Pack 270.00 3.00 273.00 330.00 57.00 21%
Fifi Feminine wash E.0003 Bottle 100.00 3.00 103.00 150.00 47.00 46%
VITAMINS/DRINKS/COFFEE
Unit Value Mark-up
Unit of
Product Description Stock No. Purchase Average Cost of Suggested
Measure Amount Percentage
Price Freight-In Goods Sold Retail Price
Maxi Dooms F.0001 Bottle 120.00 3.00 123.00 150.00 27.00 22%
Detoxi Slim F.0002 Bottle 350.00 3.00 353.00 450.00 97.00 27%
Chia Seeds F.0003 Pack 110.00 3.00 113.00 150.00 37.00 33%
Lemon Chia Seeds Fiber Drinks F.0004 Box 240.00 3.00 243.00 300.00 57.00 23%
Honey C Vitamin Supplement F.0005 Bottle 250.00 3.00 253.00 350.00 97.00 38%
Lean 'n Green Coffee F.0006 Box 154.00 - 154.00 270.00 116.00 75%
Frozen Collagen F.0007 Pack 350.00 3.00 353.00 450.00 97.00 27%
Collasure Collacenta Beauty Drink F.0008 Bottle 2,200.00 3.00 2,203.00 2,300.00 97.00 4%
Prolife Vitamin E tablets F.0009 Bottle 100.00 3.00 103.00 150.00 47.00 46%
OTHER PRODUCTS
Skin Sensation's Scar-minator Z.0001 Piece 220.00 3.00 223.00 250.00 27.00 12%
Frosted Skin Varicose remover Z.0002 Box 70.00 3.00 73.00 100.00 27.00 37%
Sugar Ball Snail Scrub Z.0003 Jar 200.00 3.00 203.00 250.00 47.00 23%
Kinoki Cleansing Detox Foot Pads Z.0004 Box 50.00 3.00 53.00 80.00 27.00 51%
Creation Spa Essentials Pain Relief
Rub Z.0005 Piece 130.00 3.00 133.00 160.00 27.00 20%
Angel Touch Citronella Insect
repellant Z.0006 Bottle 120.00 3.00 123.00 150.00 27.00 22%
Haplas liniment Z.0007 Bottle 120.00 3.00 123.00 150.00 27.00 22%
Promotion
Beauty ‘n Health Madness’ strategy is based on serving our markets well. We will start
our first outlet as a “market tester” that could become a model of the expanding number
of outlets in the future. Concentration will be on maintaining quality and establishing a
strong identity in the local market.
Aside from social media, Beauty ‘n Health Madness will also make use of print- outs
such as of flyers, leaflets and tarpaulins. Flyers and leaflets are single sheets of paper that
have a lot of information such as the store’s product images, some price incentives, and
contact details. The cost of creating a flyer design is very low amongst all marketing
material.
Product of Forecasts
Beauty and personal care are projected to see an even stronger performance
over past years. Growth is expected to be supported by the country’s strong
economic projections and its young and rapidly growing population.
Beauty ‘n Health Madness’ anticipates the highest peak on the months of November
and December in our sales forecasts, due to holiday seasons. On November, workers
specially in the government receive their year- end bonus and cash gifts while on
December, people tend to spend most of their income. These explain the jumped of
sales in these last two months of the year.
Controls
Beauty ‘n Health Madness’ requires a long relationship with the suppliers and
distributors as well as partner vendors. For this to be achieved, the management will
do its best to maintain a good standing to its suppliers and distributors by being a
good payor of all the purchases made and maintaining a good interpersonal
relationship.
Business Strategic Initiatives
The health needs of people are constantly changing, and this has led to the rise in the
demand of the Health and Wellness market at the global level. In present times, the global
health and wellness industry is worth USD 4.2 trillion. Based on the consistent expansion
of the market, it is expected that it will further expand in the next five years. Today,
people are willing to spend more amount of money on improving their health and well-
being. This has driven the demand of the industry to a substantial extent. Some of the key
sectors that exist in the prosperous Health and Wellness industry include healthy eating
and nutrition, personal care and beauty, fitness and mind-body, workplace wellness, and
many more. All these sectors have contributed to the overall growth and expansion of the
entire industry.
Moreover, the rise of the middle class is boosting the Philippine market for health and
beauty products. According to estimates contained in “The Health & Beauty Retailing in
the Philippines, Market Shares, Summary & Forecasts to 2021,” GlobalData said higher
incomes are driving a shift to products for personal care.
Based on the same report, the Philippine economic growth is among the fastest in
Southeast Asia where the retail sector will post a “healthy” compound annual growth rate
of 8.2% in the five years to 2021. The health and beauty sector is forecast to hit P529.1
billion by 2021 with an annual growth rate of 4.7%.
The Beauty and Personal Care market is thriving and one of the fastest growing consumer
markets, driven in particular by the Cosmetics and Skin Care segments. The main reason
for the strong growth is the generational shift of young consumers entering the market.
At the same time, the change is reinforced by social media, internationality and
eCommerce, which have a lasting effect on the buying behavior of beauty products.
Trends from all over the world are spreading and changing the daily beauty and care
routine.
Figure 1 below shows the revenue of the Beauty and Wellness market globally, with
particular emphasis on the Philippines’ total revenue which amounted to US$ 5.67 million.
Figure 1- Revenue generated from beauty and wellness market, esp. in the Philippines
Moreover, Figures 2 and 3 shows the revenue growth for the past years including the
forecasted increase until 2023.
Figure 2. Revenue from Beauty and Personal Care Market in the Phils from 2012-2019 with
forecast for 2020-2023 (Source: Statistica, October 2019)
Figure 3. Revenue growth from Beauty and Personal Care Market in the Phils from 2012-2019
with forecast for 2020-2023 (Source: Statistica, October 2019)
As can be seen, there has been substantial growth in the health and wellness industry. With
the trend, it is expected that the Beauty and Personal Care/ Health and Wellness will
continue to soar, as market shifts their priority to health and wellness.
SUPPLIERS
Able to fulfill
Beauty ‘n Health
MadnessReview
Store
Create Receive &
inventory Send order Store/place
purchase Inspect
below to supplier inventory
order inventory
levels for sale
Choose
another
supplier
CUSTOMER
Purchase
inventory
1. Physical count of inventories shall be performed weekly, upon turn- over of the store
attendant to Mrs. Laran during Sundays, in order keep track the remaining quantity of
each product brand. With the use of stock cards, the number of products are being tracked
and updated.
2. Report on the Physical Count of Inventories shall be made every end of the month.
3. When the number of products reached the minimum level, Purchase Order is made.
4. Purchase Order is sent to the supplier through direct contact. Once supplier confirm about
the order (considering its terms, prices, etc. as agreed), the store manager or sales staff
records the delivery date of the stocks.
5. Upon the arrival of the stocks, the proprietor inspect the items thoroughly regarding its
quantity and whether the items delivered are in good condition.
6. Items delivered shall be kept in a safe storage room and are subject to be displayed for
sale the next day.
7. Expiry dates of the beauty products should be monitored and recorded.
Note: Figures 5.0 - 5. are forms to be used in conducting an inventory control including
purchase of stocks.
The management will use stock cards for each product to track the ins and outs of the inventory.
Stock card ensures that the store has sufficient stocks to meet customer needs.
Figure 5.1 Purchase Order Template
B. Physical Store
Beauty ‘n Health Madness
Store Model
3 meter x 3meter Mall Kiosk
A kiosk layout is designed to the proposed Beauty ‘n Health Madness store that guides
product placement, directs customer flow, and defines the overall look and feel of our
kiosk and deserves plenty of thought. This creative layout highlights different products.
Retail store cabinets are placed at angles to encourage customers to slow down and
explore highlighted categories of beauty products at every turn. This layout creates open
sightlines throughout the kiosk so beauty products are highly visible.
Listed below are the suppliers/ distributors that the proprietor has contact with:
4. Cosmetic Buffet-Manila
Address: 4927 Chico St. Valenzuela ext Sta Mesa V.Mapa Sta. Mesa
Manila, Philippines 1016
ana24isidro@gmail.com
0949 776 9685
7. GLUTAX, Inc.
Address: Manila, Quezon City
Landline +6325006457
Email: support@glutax.com.ph
Person Responsible
Beauty ’n Wellness Madness will be located in the new Gaisano Grand Mall, Abgao, Maasin
City, Southern Leyte. Mrs. Jessica Laran solely owns the store. Mrs. Laran, is an advocate of
self- care and self- enhancement movement, believing that taking care of one’s self is a mean to
acquire and gain self- respect and self- confidence that are important for an individual’s mental
health and total well- being.
With the construction of the new Gaisano Grand Mall in Massin City, the owner has seen that
the timing is right to start a new venture since it is undeniably evident in different social media
platforms that today’s generation is already hooked to self- care and enhancement products and
services.
The management of Beauty ’n Wellness Madness is consist a of the proprietor himself and a
store attendant. The attendant will be in charge of the store from Mondays to Fridays, 9:00 AM
to 9:00 PM while Mrs. Laran will be attending it on Sundays during mall hours. Since Mrs,
Laran, is knowledgeable on accounting and bookkeeping, there is no need for her to hire a
bookkeeper to maintain the store’s book of accounts.
OPERATION EXPENDITURE
A. Start- up Requirements
Beauty 'n Health Madness
Jessica
MichaelLaran
A. Masigasig
Gaisano Mall, Abgao, Maasin City, So. Leyte
987-654-321-000
Start-up Me rchandise Inve ntory
Unit Value
Unit of
Product Description Stock No. No. of Units Ave. Freight- Total Freight- Cost of Goods
Measure Unit Cost Total Cost
Start-up Requirements Purchased In per Unit In Available for Sale
REJUVENATING SETS
Brilliant Skin Essentials Beauty Sets A.0001 Box 210.00 100 21,000.00 3.00 300.00 21,300.00
Fairy Skin FacialStart-up
Sets Expenses A.0002 Box 210.00 100 21,000.00 3.00 300.00 74,750.00
21,300.00
Skin Magical Beauty Sets A.0003 Box 200.00 100 20,000.00 3.00 300.00 20,300.00
Cosmetic Buffet
Taxes and Licenses
A.0004 Box 210.00 100 21,000.00 3.00 300.00
9,350.00
21,300.00
Ryx Skincerity Beauty Kits DTI Certificate
A.0005of Registration
Box 400.00 50 20,000.00 3.00 150.00 1,000.00
20,150.00
Prestige International Beauty Sets A.0006 Box 210.00 100 21,000.00 3.00 300.00 21,300.00
Glutax 5Gs Beauty Sets
Brgy. Clearance
A.0007 Box 200.00 100 20,000.00 3.00 300.00
350.00
20,300.00
Yasuy Set Fire Inspection
A.0008Certificate
Box 210.00 100 21,000.00 3.00 300.00 2,500.00
21,300.00
CREAM/LOTION/POWDER
Mayors Business Permit 5,000.00
Vitamin E Moisturizing CreamBIR Certificate
B.0001of
Registration
Jar 180.00 100 18,000.00 3.00 300.00 500.00
18,300.00
Vitamin E Gluta fresh milk lotion B.0002 Pack 200.00 100 20,000.00 3.00 300.00 20,300.00
Vitamin E powder B.0003 Box 180.00 100 18,000.00 3.00 300.00 18,300.00
Vitamin E facial wash Legal Expenses B.0004 Box 280.00 100 28,000.00 3.00 300.00 5,000.00
28,300.00
Glutax lotion B.0005 Bottle 200.00 100 20,000.00 3.00 300.00 20,300.00
Daphnie Summer wild lotion
Contract of Lease
B.0006 Bottle 200.00 50 10,000.00 3.00 150.00
5,000.00
10,150.00
Glutamansi lotion B.0007 Bottle 160.00 50 8,000.00 3.00 150.00 8,150.00
Fairy Skin lotion B.0008 Bottle 400.00 100 40,000.00 3.00 300.00 40,300.00
Rent
Navarro's Bleaching lotion B.0009 Jar 380.00 100 38,000.00 3.00 300.00
45,000.00
38,300.00
SOAP
Vitamin E soap
Printing and Publication
C.0001 Pack 120.00 100 12,000.00 3.00 300.00
5,400.00
12,300.00
Dermablend Cleansing milk Official Receipt
C.0002 Bottle 180.00 100 18,000.00 3.00 300.00 5,000.00
18,300.00
Daphnie Bleaching Soap
Navarro's Bleaching Soap
Tarpauline C.0004 Box
C.0003
Box
200.00
250.00
50
100
10,000.00
25,000.00
3.00
3.00
150.00
300.00
10,150.00
400.00
25,300.00
Glutax Soap C.0005 Box 120.00 100 12,000.00 3.00 300.00 12,300.00
Soaplada Stunning White C.0006
Soaplada Brilliant Bar
ExpensesBox
Miscellaneous C.0007 Box
210.00
150.00
100
100
21,000.00
15,000.00
3.00
3.00
300.00
300.00
21,300.00
10,000.00
15,300.00
Yasuy Bleaching Ultimate Soap C.0008 Box 250.00 100 25,000.00 3.00 300.00 25,300.00
Start-up Assets
SHAMPOO
880,310.00
Aloe Grow Cash Register D.0001
Machine Bottle
(10 years EUL300.00
with 5% RV) 50 15,000.00 3.00 150.00 27,000.00
15,150.00
Kineza Hair Grower
Furniture and Fixtures (10 years EUL with 5% RV) 50
D.0002 Bottle 200.00 10,000.00 3.00 150.00 10,150.00
50,000.00
Merchandise Inventory
FEMININE WASH/PADS/LUBRICANTS 803,310.00
Pinky Secret Feminine wash E.0001 Bottle 100.00 100 10,000.00 3.00 300.00 10,300.00
Lean 'n Green Happy pads E.0002 Pack 270.00 100 27,000.00 3.00 300.00 27,300.00
Jessica Laran, Capital
Michael A.
Fifi Feminine wash Masigasig,E.0003
CapitalBottle 100.00 100 10,000.00 3.00 300.00 500,000.00
10,300.00
Pakgel - Pakboy E.0004 Pack 40.00 50 2,000.00 3.00 150.00 2,150.00
Pakgel - Pakgirl E.0005 Pack 40.00 50 2,000.00 3.00 150.00 2,150.00
Titan Gel Gold Loans E.0006 Box 1,000.00 10 10,000.00 3.00 30.00 600,000.00
10,030.00
GSIS GFAL I (400,000.00 at 6% interest per annum straight payable in 6 years) 400,000.00
VITAMINS/DRINKS/COFFEE
Maxi Dooms DBP Salary
Loan (200,000.00
F.0001 Bottle at 6% interest
120.00 per annum
50 straight payable in 3.00
6,000.00 3 years) 150.00 200,000.00
6,150.00
Detoxi Slim F.0002 Bottle 350.00 50 17,500.00 3.00 150.00 17,650.00
Chia Seeds F.0003 Pack 110.00 50 5,500.00 3.00 150.00 5,650.00
Lemon Chia Seeds Fiber Drinks F.0004 Box 240.00 50 12,000.00 3.00 150.00 12,150.00
Honey C Vitamin Supplement F.0005 Bottle 250.00 50 12,500.00 3.00 150.00 12,650.00
Lean 'n Green Coffee F.0006 Box 154.00 200 30,800.00 - 30,800.00
Frozen Collagen F.0007 Pack 350.00 100 35,000.00 3.00 300.00 35,300.00
Collasure Collacenta Beauty Drink F.0008 Bottle 2,200.00 10 22,000.00 3.00 30.00 22,030.00
B. Start- Up Merchandise Inventory
Prolife Vitamin E tablets F.0009 Bottle 100.00 100 10,000.00 3.00 300.00 10,300.00
OTHER PRODUCTS
Skin Sensation's Scar-minator Z.0001 Piece 220.00 50 11,000.00 3.00 150.00 11,150.00
Frosted Skin Varicose remover Z.0002 Box 70.00 50 3,500.00 3.00 150.00 3,650.00
Sugar Ball Snail Scrub Z.0003 Jar 200.00 50 10,000.00 3.00 150.00 10,150.00
Kinoki Cleansing Detox Foot Pads Z.0004 Box 50.00 50 2,500.00 3.00 150.00 2,650.00
Creation Spa Essentials Pain Relief Rub Z.0005 Piece 130.00 100 13,000.00 3.00 300.00 13,300.00
Angel Touch Citronella Insect repellant Z.0006 Bottle 120.00 50 6,000.00 3.00 150.00 6,150.00
Haplas liniment Z.0007 Bottle 120.00 50 6,000.00 3.00 150.00 6,150.00
792,300.00 11,010.00 803,310.00
C. Statement of Financial Position
Beauty and Health Madness
Michael A. Masigasig
Jessica E. Laran
Gaisano Mall, Abgao, Maasin City, So. Leyte
987-654-321-000
ASSETS
Current Assets
Cash & Cash Equivalents 54,940.00
Cash on Hand 5,000.00
Cash Cashier/Sales Clerk -
Petty Cash Fund 5,000.00
Receivables -
Accounts Receivables -
Receivables-Customers -
Inventories 803,310.00
Inventory Held for Sale 803,310.00
Merchandise Inventory 803,310.00
Non-Current Assets
Property, Plant & Equipment 77,000.00
Non-Current Liabilities
Financial Liabilities 600,000.00
Payables 600,000.00
Long-term loan - GSIS GFAL II 400,000.00
Long-term loan - DBP Salary Loan 200,000.00
Total Non-Current Liabilities 600,000.00
NET ASSETS/EQUITY
Assessment of Risk
A. Evaluate Weakness of Business
B. New technologies
C. Contingency Plan
Preparation: Regular monitoring of items. First in, first out policy. Attend
seminars or conventions on skin care and health management.
Response: Schedule weekly inventory.