Puregold Price Club, Inc.

HOLY ANGEL UNIVERSITY

School of Business and Accountancy
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Strategic Business Analysis Paper: Puregold Price Club, Inc.

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In Partial Fulfillment
Of the Requirements of the Course
6417 MASTRATBUSANA:
Strategic Business Analysis
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Presented to:
Mrs. Caroline M. Acosta

Presented by:
Group 5, MA-439

Members:
Barroga, Angelica U.
Cadiang, Ralph Renz S.
Camacho, Raynald R.
Mallari, Anne Niquel S.
Tumulak, Nichole G.

Submitted on:
October 12, 2021

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Puregold Price Club, Inc.

Table of Contents

I. Introduction………………………………………………………………………………1

Company Background……………………………………………………………….1

Mission and Vision…………………………………………………………………..2

Goals and Objectives………………………………………………………………...2

Core Values………………………………………………………………………….2

II. External Analysis……………………………………………………………………….4

III. Internal Analysis Practices of an Organization……………………………………...5

IV. Generic Business Analysis Approaches and Tools…………………………………...14

References…………………………………………………………………………………...21
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Puregold Price Club, Inc.

I. INTRODUCTION
Company Background
Puregold Price Club, Inc. is a Philippines-based company engaged in the business of
buying and selling goods, such as consumer products (canned goods, housewares, toiletries, dry
goods, and food products, and etc.) on a wholesale and retail basis. Incorporated in the year 1998,
the Company manages its operations through three retail formats (hypermarket, supermarket,
and discount store) when Puregold opened its first branch along Shaw Blvd. in Mandaluyong
City. The Company opened its first store in Mandaluyong City in December 1998. Puregold’s
loyalty program, “Tindahan ni Aling Puring”, was launched in 2004. The store offered a wide
array of goods from groceries, apparel, household accessories, and furniture at very affordable
prices. During that time, the one-stop shopping philosophy was still a novel idea to consumers
but with the excellent service and quality products it provided, it did not take long for Puregold
to make its mark in the retail industry.
The Company performs its operations through a hypermarket known as Puregold Price
Club, which offers a range of food and non-food products, and caters to both retail customers
and resellers. It has a supermarket chain known as Puregold Junior, which is operated by its
subsidiary Puregold Junior Supermarket, Inc. Meanwhile, Puregold Extra is the small store
format, which offers a range of goods, comprising the company’s stock-keeping units (SKUs)
ranging from 3,000 to 5,000. It operates through stores in various locations. Its stores provide
products that range from groceries, apparel, household accessories, and furniture. It has
approximately 280 operating stores and over 20 foodservice stalls (Reuters, 2021).
Among others, Puregold also owns Entenso Equities, Inc., which is the holding company
for two companies, namely, Ayagold Retailers, Inc., and San Roque Supermarkets. PPCI Subic,
Inc. is operating one Puregold branch in Subic Bay, Olongapo City.
In 2011, Puregold Price Club went public and was inaugurated as a listing on the
Philippine Stocks Exchange. They had a rapid expansion via organic new Puregold stores roll-
out and acquisitions other than that they have made history by having acquired the highest
number of new store openings ever, opening 38 new Puregold stores.
In 2012, S&R Membership Shopping adopted a warehouse club concept where most of
the products offered are in club packs. Majority of the merchandise is imported brand names
mostly sourced from the US. The shareholders of the retail chain Puregold have approved the
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Puregold Price Club, Inc.

merger of the other two operating units into the parent company, consolidating Puregold’s
supermarket businesses under the publicly listed supermarket operator.
By the end of 2020, Puregold was operating a total of 244 hypermarkets, 100
supermarkets, 28 extras, 31 minimarts, 20 S&R warehouse clubs, 46 S&R Quick Service
Restaurants, two Merkado branches, and 30 San Roque supermarkets, for a total of 501 stores
all over the country. Today, it has grown into a giant retail chain with more than 50 stores
nationwide (SEC Form 17-A, 2020).
Puregold Price Club Incorporated is the second-largest food retailer in the Philippines,
catering to end consumers and resellers. It sells consumer goods in more than 400 stores. Its
Puregold stores contribute about 80% of revenue and its membership-shopping S&R brand
contributes the rest.
Mission and Vision
Their mission is, “To provide products, services and business opportunities to every
Filipino family. We establish lasting relationships with our suppliers and business partners. We
strive to promote the personal and professional development of our employees. We commit
profitable results to the stockholders. Sa bawat araw, PUREGOLD kasama mo!”
Their vision is, “To be the most customer-oriented hypermarket offering a one-stop
shopping convenience and best value to our customers. Sa PUREGOLD, Always Panalo!”
Goals and Objectives
Puregold Price Club, Inc. aims to achieve the following:
-To focus on modern grocery retail
-To make higher margins from improving economies of scale
-To engage in-store network expansion to drive revenue growth
-To make traditional retail remain a major growth driver
-To be a key player in industry consolidation
Core Values
Their core values circulate around the following:
Sense of Belonging
-Feeling that one has an essential role to play as part of the Puregold family
Customer Service
-Providing products and services that meet the demands and expectations of customers
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Puregold Price Club, Inc.

Dynamism
-Open, adaptive, and responsive to the changing environment
Commitment
-Dedicated and conscientious focus on work
Integrity and Loyalty
-Honor, credibility, honesty, dignity, “palabra de honor”, “walking the talk”
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Puregold Price Club, Inc.

II. EXTERNAL ANALYSIS

The External analysis is really needed to be considered when having a business because
it is the one that will give the company a hint on how they can get the interest of the customers.
The Opportunities and Threats are examples of external analysis that will give the company an
edge over their competitors and have a competitive advantage over the other company.
Opportunities:
Economic Growth
Continue implementing programs that boost customer loyalty to ensure an increase in
revenues as the economy grows. Furthermore, tighten relationships with suppliers by using
economic growth to implement more programs that can benefit both the company and suppliers.
Make use of a strong brand reputation to gain access to emerging and international markets in
times of economic growth.
Increase in consumer spending
Take advantage of customer loyalty, brand reputation, and strong supplier relations by
introducing new products and stores which can accommodate the increasing wants and needs of
the customers.
Rise of the BPO industry
Use alliances, joint ventures, and supplier relations to open new stores with improved
services that can accommodate the needs of the people in the BPO sector.
Threats
Inflation
Use good customer relations and brand reputation to ensure sales despite inflation by
giving more incentives to customers who remain loyal to the company. Take advantage of
supplier discounts by maintaining or increasing just a little bit of the price during inflation.
Typhoons and natural calamities
Use strong supplier relations to ensure the reliability of service during calamities.
Strengthening brand reputation and customer relations by remaining in service during calamities
and by reaching out to the victims.
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Puregold Price Club, Inc.

III. INTERNAL ANALYSIS OF AN ORGANIZATION

Table 1. Core and Distinctive Competence Analysis Framework of Puregold Price Club, Inc.

Customer Uniqueness Leveragability Industry Key

Competencies value description description Success
Description description Factors (KSFs)
Cheap and affordable Builds lasting
prices High Medium High customer
relationship
Product availability on High High High Location and
a single-floor shop that accessibility to
appeals to low-income product
shoppers and
neighborhood stores.
Customer perk, loyalty High High High Brand loyalty
program, and reward
Core

system
Creates diversity by Medium High Medium It cannot easily be
offering a wider variety imitated by
of products competitors

Products available in High High High Product

wholesale and/or retail differentiation

World Class High Medium High Market leader in

benchmarking both low-end
resellers and
upper-income
Distinctive

segments of
shoppers
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Puregold Price Club, Inc.

Conclusions:
Puregold Price Club, Inc. is the second-largest retailer among hypermarkets,
supermarkets, and cash & carries in the Philippines, according to Planet Retail. Puregold is
focusing on middle to lower-income retail consumers. They believed that they are the first and
only hypermarket and supermarket retailer in the Philippines which strategically targets local
resellers. The company also promotes a one-stop shopping concept of having a wide selection of
goods to further serve its value-conscious consumers and resellers. With this differentiated
business model, the company has established a brand that has become associated with low prices,
value-for-money, and a wide assortment of goods on offer. It has established itself to be the
second most profitable growth compared to the previous record, 4th. It is also said to tally a
world-class performance compared to its peers, with a market capitalization of $2.113 million.
Puregold Prince Club, Inc. has indeed proved itself to be a market leader in both low-end resellers
and upper-income segments of shoppers.

Table 2. Evaluation the Culture of a Firm

Organization Culture as a Source of Competitive Advantage
Potential Source of Value Description of Culture Practices and
Results

Describe how the culture of the Puregold strengthens its relationship with
organization creates economic value employees by providing them with special
through high sales, low costs, high privileges. Some of these perks include service
margins, or other ways in which awards, promotions, cross-trainings, hotel
financial value is created. accommodations and dining, free S&R
membership, wellness seminars on fitness and
personal finance, and benefits related to retirement,
health, and accident. It also lets children of
qualified employees enjoy full scholarships at De
La Salle University and any other state universities
in the Philippines from secondary education up to
higher education, all in partnership with Luis Co
Chi Kiat Foundation, Inc. It also grants employees
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Puregold Price Club, Inc.

the opportunity to relocate and work in their

hometowns with their families. The management
cares about their workforce and their relatives. In
return, satisfied and motivated employees give their
best by showing initiative and dedication in their
work that may result in an increase in productivity
and improvement of business performance.
Puregold’s culture of recognizing and appreciating
employees fosters camaraderie and encourages
especially the pioneers to stay and continue
winning customers who could lead the company to
its desired sales, making a way for positive returns
and achievement of other financial goals.

Describe how the culture of the Puregold is a people-oriented company. Employees

organization is valuable and rare. This have a clear sense of purpose, and they know that it
includes attributes and characteristics is not all about themselves and the company but
associated with the culture that rivals do also their customers. They were taught how to deal
not have. with customers in a way that would benefit
everyone. Tindahan ni Aling Puring program that
stemmed from the company’s culture of
unselfishness gave numerous small entrepreneurs
more opportunities and big savings, attracting
customer loyalty. Its strong relationship with
resellers is an advantage that even larger companies
including SM Investments Corporation do not
have. At least 40 percent of the company’s annual
sales come from this type of customer, which is
enough to make more investors be attracted to the
company and encourage manufacturers to help as
well. Puregold’s merchandising director, Ferdinand

Puregold Price Club, Inc.
Describe how the culture of the Puregold has a culture of valuing integration and a
organization is imperfectly imitable.
8
Vincent Co believes that the sari-sari store owners
or the program’s members, as sources of valuable
insights, contributed to the growth of the company.
Caring about its customers and wholeheartedly
supporting their own businesses are traits that make
Puregold different from its rivals. These enabled it
to penetrate the class D and class E-market easily.
sense of belonging. This allows employees to feel
part of the company which influences the level of
involvement and attachment they have to the
organization. It starts nurturing employees from
their first day in the company. Everyone in
Puregold can take part in employee relations
programs such as annual team building activities,
monthly employee interactions, daily pep talks, and
HR bulletins both in the workplace and online. The
firm also conducts training that will equip the
workforce with technical, behavioral, and
leadership skills, empowering them to think of
innovative ways to cooperatively find solutions to
problems. Puregold believes that these activities
give employees inspiration to work on their
qualities and skills with the anticipation of having
a bigger contribution to the organization. The level
of trust the management gives to its employees
fosters engagement, commitment, and loyalty.
Nevertheless, semi-annual reviews are still being
conducted for employee performance and work
plans to gain feedback and to set personal and
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Puregold Price Club, Inc.

work-related goals, action plans, and targets.

Puregold has its own ways of making its new
recruits and old employees know more about the
retail industry and its own methods of having them
acquire characteristics that are being taught through
experiences within the firm that other companies
fail to copy.

Conclusions:

The firm’s utmost priority from the very beginning is caring for its people.
Understanding that every employee is significant to its business functions, Puregold accords
them with respect and appreciates each one of them by giving monetary and non-monetary
benefits. Employees then tend to be more productive and efficient, which drives up the number
of company sales, revenues, and profits, increasing the likelihood of success. The way the
management treats its people impacts everything within the company. It is also important to
note that through the company’s culture of humility in the form of Tindahan ni Aling Puring,
everybody in the company further realized that customers are not just means to an end but also
the end itself, meaning they are the result of company’s humbleness and are also the sources
used in producing desired financial outcomes. Instead of trying to eliminate sari-sari stores, the
firm rather created an alliance with their owners to help them do good in their own businesses
while simultaneously leading them to obtain their goods in Puregold. This practice did not only
give the organization strong financial certainty but also the opportunity to grow with
customers. Its down-to-earthness and unselfishness in sharing business knowledge which is
rare to see nowadays among companies that only care about financial gains, not only gave rise
to retainment and attraction of more stakeholders but also flourishment of the local economy,
making its culture valuable. Another interesting thing about Puregold is its inclusive culture.
The management builds the business together with what it calls a family, the employees. It has
the belief that employees are the building blocks for the current Puregold, so it continues in
providing them time to adapt and perform in line with the organization’s goals and objectives
while at the same time equipping them with the necessary skills to prepare them for greater
responsibilities ahead as the company grows its network of stores. Puregold is convinced that
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Puregold Price Club, Inc.

valuing its human capital decreases its employee turnover and investing in them is a sound
strategy. The way Puregold ensures that its top talents quickly become top performers is
something that rivals may find difficult to imitate. All things considered, Puregold Price Club,
Inc. has a positive organizational culture that can provide the company a competitive advantage
that can sustain its growth and solidify its position as one of the top leaders in the Philippines’
grocery retail industry.

C. Financial Health of Puregold Price Club, Inc.

Puregold Price Club, Inc. financial reports show that the Company can be able to finance
its future plan for growth and development, and expansion internationally. Based on the financial
reports of the company for the year 2016 to 2020, the Company reported an increase around 2
billion up to 3 billion even if we are experiencing COVID-19 Pandemic. The Puregold Price
Club, Inc. has a bright future in 2021, with plans for the Company that raises P12 billion to
expand the business. Puregold Price Club, Inc. has 444 stores nationwide highly benefited from
a consumer scramble to fill up household stocks before strict lockdowns were enforced last
March. With many still staying indoors even after restrictions eased June 1, the firm bucked a
generally business sentiment to register earnings of P3.4 billion in the first half up 20% year on
year.

By having the total equity of Puregold Price Club, Inc. in the year 2020 with an amount
of P68,501,719,932, considering the resources, it will serve as an edge for the Puregold Price
Club, Inc. to expand product line offerings and respond to the changes that happened in the
business to the country. Financial performance entails the planning, organizing, directing, and
observing activities, such as the acquisition and use of funds. The ability of the Company
conceding the financial resources in developing and growing financial means, surviving the risks
in the market, and absorbing profitability is known through gathering its financial instruments.

In the previous year, the Puregold Price Club, Inc. obtained net income on cash flow
operating activities amounting to P6,772,787,777. The cash flow from operating activities is the
inflows and outflows occurring from normal business operations. It served as a determinant of
the financial profitability of the Puregold Price Club, Inc. on its business ventures. The cash
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Puregold Price Club, Inc.

flows from financing activities present an insight into the financial health of the corporation as
well as the management of the funds. Considering the financial health of the cash flow of the
Company, they are committed in making the most out of it in providing quality service and
excellent products in the country. Even if the pandemic affected the overall operations of all
business establishments, it would remain organized and continue growing each year.

Figure 3. Analysis of Core Strategic

Key strategic Assumption Positive Assumption Conclusion on
Negative Strategic Risks
choices risk
assumptions

Online marketing to Puregold Price Club, Puregold Price Club, The Philippines is a
be a big trend in the Inc. has been aware Inc. would not utilize country known to
Philippines and is open to the emerging have numerous
innovation. They technologies. Their online consumers,
know how to competitors will especially in the
capitalize on the rise outgrow them by middle of the
of technology and wisely using the pandemic. Now that
proper usage of various social media everyone has little to
social media. With platforms for their no chance of going
proper advertising, advertisements. outdoors, it is perfect
their sales could Aside from that, the for companies to
foster even more. competitors might have a good
develop a marketing strategy
competitive and advertisement to
advantage against take advantage of the
Puregold. situation.

Puregold Price Club, The firm is an asset- Puregold cannot Renting enables
Inc. focuses light company, it can acquire or build any Puregold to prioritize
primarily on be discerned with the equity over the and concentrate on
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Puregold Price Club, Inc.

operations rather than way it prefers lease leased property. It its retail business
investments in arrangements over may also encounter because it does not
physical assets. the construction of an increase in leasing need to concern itself
new buildings. cost in the long run anymore with
Puregold expands as well as face property
and relocates its contractual penalties management. This
stores as deemed when one of its stores can provide
necessary, making occupying a leased profitability because
property leasing the space becomes of the minimum
best direction it could unprofitable. investment required
go to attain for store expansion.
flexibility. Leasing Being unprofitable
can provide or save may be avoided
more available cash particularly by
that may be invested ensuring that the
in the firm’s products business is placed on
or services and the commercial locations
establishment of where it could
additional stores as entertain customers’
opposed to buying needs and that store
another capital asset premises are not
that typically requires concentrated in one
spending more cash. place to achieve a
high margin.

Establishing The geographical Substantial Expansion of

Puregold stores in advantage is one of investment or business in Visayas
Visayas and the reasons why operational risks are and Mindanao gives
Mindanao areas Puregold ventures possible. There could Puregold an upturn in
drives revenue into these areas. be disruptions in its its net income.
growth. Eventually, it would supply chain that However, risks
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Puregold Price Club, Inc.

lead to increased could increase associated with this

profitability since operating expenses, undertaking can pose
revenues and profits lower margins, and difficulties in the
would most likely limit the expansion company’s operation.
rise as well as the potential. Relying on third-
company gains Competitive risks party logistics from
familiarity and including price war suppliers and
stability in these could also happen regional distributors
locations. Stability between the company which enables it to
can be achieved if and its rivals such as minimize distribution
there is a rapid climb SM Retail that costs and making use
in sales that could already has several of its healthy
override operating stores across the relationship with its
costs. country. resellers and asset-
light strategies may
address these threats.
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Puregold Price Club, Inc.

IV. GENERIC BUSINESS ANALYSIS APPROACHES AND TOOLS

Step 1. Confirm the Opportunity
The Company conducts its operations through several retail formats and store brands.
Hypermarkets, through “Puregold Price Club”, offer a variety of food and non-food products
and generally cater to both retail customers and resellers such as members of the Company's
loyalty program. Supermarkets, through “Puregold Junior”, operate as a neighborhood store that
offers a higher proportion of food to non-food products vis-a-vis the Company's hypermarkets.
Discounters, through “Puregold Extra”, operate in a small store format that offers a more limited
number of goods. Meanwhile, S&R Membership Shopping adopts a warehouse club concept
where most of the products offered are in club packs. Majority of the merchandise is imported
brand names mostly sourced from the US.
Steps 2 and 3. Alternatives and Evaluation of Alternatives

Alternative 1. Build a substantial digital presence by adopting digital transformation

and reinforcing customer relationships through personalization and engagement.

A retail store like Puregold Price Club, Inc. must keep pace with the accelerated shift of
consumers to online shopping caused by the COVID-19 crisis. During this period, the firm’s
official website, social media platforms, and mobile application can be used as channels in
providing not only services and goods but also entertainment. Therefore, it is crucial for the
company to maximize its utilization.

In statements:

Benefits
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Puregold Price Club, Inc.

Financial: · Making use of Puregold’s online networks can attract more people. With
a continuous online presence, a possible sales spike brought by an
increasing number of customers can be observed that may generate
upward growth in revenue.

· The firm can achieve and boost sales without increasing some operating
costs such as employee salaries, rent, and utilities. Hence, total expenses
may be reduced resulting in profitability.

Strategic: · Taking advantage of consumers’ inability to leave their homes by

providing innovative content like series or movies, and games or shows
with prizes such as discounts in its online platforms will generate
consumer engagement and brand recognition.

· Employing a data-driven approach with the help of customer

relationship systems may let the firm acquire information to serve its
customers and consumers better, improving its competitive positioning
accordingly.

· Providing technology-based services and delivering unparalleled

customer experience especially during this time can secure and
strengthen customer relationships that are necessary for fulfilling major
company goals.

Organizational · It can attract more potential investors, strong return on investments, and
and Societal:
development of competitive strategies.

· It can offer more personalized offers and recommendations. This adds

customer value.
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Puregold Price Club, Inc.

Costs

· Although online selling may reduce overhead costs, it does not eliminate the fact that
infrastructure costs may increase if the company experiences rapid growth sales since a need
for physical space to warehouse goods is necessary.

· The costs to create a professional online image like website costs, online marketing costs, and
investments in customer service and security systems could be expensive.

· There could be difficulties in building trust and establishing a relationship with the customers
since personal interaction is limited. Competition in cyberspace among retail stores may also
produce struggles in finding repeat customers.

· Legal issues in e-commerce such as consumer rights information and social media laws and
regulations may risk damaging Puregold’s reputation and result in losing sales.

Alternative 2. Be a key catalyst for change in the retail industry by partnering with
local suppliers.

Customers tend to buy according to their preferences and when the offerings are good.
Puregold, as one of the leading providers of services and products to families specifically to
low-income families, can produce robust selection of goods tailored to the needs and wants of
customers with the help of local people and their businesses.

Benefits
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Puregold Price Club, Inc.

Financial: · Partnerships with local suppliers is another way to bring innovation into
Puregold’s retail stores. It brings higher productivity, creates added value,
consumer confidence, and brand loyalty leading to more gross sales.

· It can cut costs in differentiating its products. Differentiated and high-

quality local products present a higher profit margin.

Strategic: · Supporting local businesses like bakeries by partnering with them may
further target shoppers in the locality. Consumers nowadays want to
know precisely where the goods come from because of their conscious
mindset about health. Educating them about the suppliers might empower
these people to support local businesses as well, which means more free
advertising and sales for Puregold.

· Uncommon opportunities like this can become the company’s

competitive advantage.

Organizational · It provides exploration and development of discovery in a quickly

and Societal:
evolving market.

· It provides profitable opportunities to local businesses, establishing

valuable and lasting partnerships.

Costs

· There could be a possible lack of harmony between parties.

· Risks of having less efficient suppliers with fewer economies of scale is an issue.
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Puregold Price Club, Inc.

· Suppliers’ resistance to change is possible. They may depend much on buyers leading to
complacency.

Alternative 3. Pursue growth through acquisitions and expansions into new geographic
locations.

These business strategies are fundamental to further expand and offer new products to a
wider range of customers.

Benefits

Financial: · An increase in market share or scalability due to acquisition may lead

Puregold to a better competitive position.

· An improved inventory turnover may be observed.

Strategic: · Targeting market segments that existing competitors are not serving can
entice more customers.

· Better economies of scale are realizable.

Organizational · Employee development and continuous improvement can be achieved.

and Societal:
· Operating in more areas gives more people the opportunity to get their
needs and wants.

Costs
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Puregold Price Club, Inc.

· Rapid business growth is harder to control. Business risks such as financial losses and
instability are expected if it is not well-managed.

· Acquisition is often an expensive and time-consuming undertaking. It requires significant

financial and people resources.

Step 4. Implementation Strategy

Should the first option be chosen, it will surely give the company a better outcome in the
near future. Opening a digital platform will surely help them to become more convenient and
easily accessible that the customer can buy wherever they are. All the personnel will benefit in
this kind of strategy, but it is riskier when it comes to the data of the customer. They must also
update the digital platform by having a different promo or advertisement, to get the interest of
the consumer.
If the second one is chosen, it will not only benefit the customer in the lower prices of
the products but also, we can give an opportunity to the local supplier to become popular in our
places. Being partners with the local supplier will help them to be well known and give them the
consumer confidence and loyalty on their products. Through this they can help the economy of
the Philippines to be proud of the local products.
The third option suggests pursuing growth through acquisitions and expansions into new
geographic locations. It is very effective to introduce a new product in a much bigger
marketplace. On the other hand, it is very risky to spend a lot of money on expansion in a bigger
place because a lot of things will be considered. Just like how to penetrate the marketplace and
also there is an existing supermarket that is well trusted by the people around that place. In this
situation you must think of a strategy that will surely get the interest of the customer and gain
their loyalty.
Step 5. Recommendation
It is recommended for Puregold Price Club, Inc. to choose the first alternative which is
to build a substantial digital presence by adopting digital transformation and reinforcing
customer relationships through personalization and engagement. Adapting to the new livelihood
setup and capitalizing on emerging technologies would benefit the branding and market
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Puregold Price Club, Inc.

placement of the company. The Philippines is a country known to have numerous online
consumers, especially in the middle of the pandemic. Now that everyone has little to no chance
of going outdoors, it is perfect for companies to have a good marketing strategy and
advertisement to take advantage of the situation. The firm can achieve and boost sales without
increasing some operating costs such as employee salaries, rent, and utilities. Hence, total
expenses may be reduced resulting in profitability. Employing a data-driven approach with the
help of customer relationship systems may let the firm acquire information to serve its customers
and consumers better, improving its competitive positioning accordingly.
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Puregold Price Club, Inc.

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Final Paper: Puregold Price Club, Inc.

HOLY ANGEL UNIVERSITY

School of Business and Accountancy
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Strategic Business Analysis Final Paper: Puregold Price Club, Inc.

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In Partial Fulfillment
Of the Requirements of the Course
6417 MASTRATBUSANA:
Strategic Business Analysis
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Presented to:
Mrs. Caroline M. Acosta

Presented by:
Group 5, MA-439

Members:
Barroga, Angelica U.
Cadiang, Ralph Renz S.
Camacho, Raynald R.
Mallari, Anne Niquel S.
Tumulak, Nichole G.

Submitted on:
November , 2021
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Final Paper: Puregold Price Club, Inc.

a.

Table 1. Theory of business analysis assumption (RAYN AND NICHOLE)

Assumptions about the Assumptions about the Assumptions about the core
environment of the mission and aspirational competencies needed to
organization description of the accomplish the mission
organization
The Puregold Price Club, Inc. They wanted to provide for They strive to promote the

is an organization engaged in the needs of every consumer Personal and Professional

the trading of goods such as in a very convenient way. Development of their

consumer products. employees.

The organization is a retailing To provide services and They commit profitable

business segment. business opportunities for results to the stockholders.

every Filipino Family.

They have Puregold Jr. and Establish lasting They indicate their healthy

Puregold Extra is part of the relationships with their relationship with their

business in a most convenient suppliers and business employees and their drive to

way. partners. promote their employees’

development both

professionally and personally.

Final Paper: Puregold Price Club, Inc.

b.
Figure 1. Business model canvas (ANGELICA)

Key partners Key activities Value proposition Customer Customer

• Multinational • Trades a wide • Saves customers relationships segments
and domestic assortment of from incurring • Self-service • Retail
companies goods large expenses by • Personal Consumers
(buyer-supplier primarily offering cheaper assistance (Class C and
relationship) consumer and affordable • Online Class D)
products on a products in all its engagement i. Average
• Strategic wholesale and stores Income:
technology retail basis • Provides excellent P12,000 to
partners • Implements customer service P80,000
i. Globe organic • Offers an offline • Retail
Ventures expansion and online smooth Consumers
ii. Blue Yonder strategy shopping (Class A and
iii. Vision • Drives experience and Class B)
Solutions, Inc. effective use of easy payment ii. Average
technology via methods Income: over
• Merchant an e-grocery • Provides delivery P80,000 per
partners platform services within 24 month
i. GCash • Delivers hours via Puregold • Resellers
ii. Shopee business PasaBuy (small to
continuity and • Gives fuel medium size
• Cleanfuel IT resiliency discounts for sari-sari
(partnership through JDA Tindahan ni Aling stores and
marketing) MMS and Puring or Perks business
iTERA HA Card members owners)
• Stimulates
demand for
products
through sales
promotion and
other
management
strategies and
programs
• Increases
market base
and market
efficiency
Final Paper: Puregold Price Club, Inc.

Key resources Channels

• Physical • Physical
resources (484 channels
current stores i. Puregold Price
nationwide) Club
• Human (hypermarket)
resources ii. Puregold
(11.33k current Junior
employees) (supermarket
• Brand and chain)
company iii. Puregold Extra
culture (grocery/small
• E-commerce store)
platforms iv. Sari-sari stores
• Partnerships (retail customers,
resellers, and
business
associates)
Purchase:
over-the-counter
payment via cash
or debit/credit
card
• Virtual channels
i. Official
Puregold Website
ii. PureGo and
Puregold Mobile
(mobile apps)
iii. Facebook,
Twitter, and other
social media
platforms
Purchase: online
payment options
and e-wallets via
GCash App and
ShoppePay
Cost structure Revenue streams
• Operating expenses (rent, utilities, • Sale of physical product (72% revenue
equipment, fixtures, maintenance and repairs, from Puregold stores network)
payroll, inventory, leasehold improvements) • Membership income (28% revenue from
• Marketing costs (advertising campaigns, S&R warehouse clubs and stores)
sponsorships, discounts, salesforce expenses, • Concession income (tenants/concession
stand)
Final Paper: Puregold Price Club, Inc.

promotional events, celebrity endorsement,

and influencer marketing, market research)

c.
Table 2. Strength analysis (ANNE NIQUEL)
Internal resource Reason/rationale
strengths (weak) – 10
(strong)
Customer perk, The loyalty program is
loyalty program, and the reason why many
reward system consumers still choose
the service of the
company. Puregold
Membership: “Aling
Puring Card” gives out
more benefits than its
competitors.
Branded as one of Cheap and affordable
the leading prices that build a
supermarkets, lasting relationship
hypermarkets, and with customers.
retail stores in the
Philippines
Commendable Product availability on
accessibility of a a single-floor shop that
location to the target appeals to low-income
market shoppers and
neighborhood stores.
Numerous branches Cater the target market
from any region as
each brand can easily
be located.
Scale 1 Key learnings
implication
10 Puregold Price Club, Inc.
has established itself to be
a consumer-centered
company by focusing most
of its services on them.
With this, the company is
able to build strong and
lasting relationships with
its consumers with the
9 number of perks that they
are giving. With this, they
are expected to bring
better ideas into keeping
their consumers to them
8
8

Table 3. Weakness analysis (ANNE NIQUEL)

Internal resource Reason/rationale Scale 1 (weak) Key learnings
weakness – 10 (strong) implication
Rising competition New companies that 5 Despite its strength in
among industry cater to the same customer relationships,
players service have been Puregold Price Club, Inc.
emerging. still has to focus on
Outdated technology Low investments in 6 various things that can
research and affect the growth of their
development. company. Supermarkets,
hypermarkets, retail stores,
Final Paper: Puregold Price Club, Inc.

Limited portfolio of The company has 5 and other similar services

high-margin items focused on expansion that they are offering can
into grocery retail be seen everywhere from
store formats different companies or
“Puregold Extra” and stores. What they are
“Puregold Jr.” offering is valuable,
Too many taxes Scrutiny on corporate 5 however, it can easily be
needed to be paid governance issues imitated by key players in
due to related-party the industry. Aside from
transactions. that, the company should
be able to capitalize on the
fact that the technology is
continuously emerging and
they should use it to its
advantage.

Table 4. Threat analysis (RALPH)

External Reason/ Probabilit Impact 1 Risk Key learnings
market rationale y 1 (weak) (weak) – rating implication
and – 10 10 (strong) (probabilit
industry (strong) yx
threats impact)
Increase in The company 7 9 63 By analyzing the
Credit card should invest in a threats of
frauds. security Puregold Price
operational Club Inc. it can
system to protect develop specific
the company and security policies
its customers. and understand
Increase in Increasing labor 5 9 45 the needs for
Labor Cost. costs can either securing the
increase the total resources.
employment or
increase the hours
per worker.
Technologi Monthly bills will 4 9 36
cal Costs. pile up at the end
of the month
which involves
the utilities as
well as the
payments to
suppliers.
Final Paper: Puregold Price Club, Inc.

External Lower revenue, 4 8 32

Business profit, and
Risk. financial loss.

Table 5. Opportunity analysis (RALPH)

External market Reason/rationale
and industry (weak) – 10
opportunities (strong)
Puregold To lure more loyal
Membership Card: customers and lessen the
Aling Puring Card agitation of consumers
gives out more when it comes to sudden
benefits than its changes in prices.
competitors.
Eco-Bags since the Good marketing scheme
launch of the “I am to sell more products
not a plastic bag”. through inculcating the
use of eco-bags as
freebies when reaching a
certain amount on a
single purchase.
Online consumers Using the internet as a
using the Internet for medium for buying their
grocery shopping. needs is a good
opportunity to start a
new strategy for online
shops.
New products and The company could
Services reach out to more
customers by introducing
new promotions to other
branches and to increase
sales.
Scale 1 Key learnings
implication
10 The Puregold Price
Club Inc. has been
recognized as the
people-centric mindset
and the most
customer-oriented
9 hypermart that offers
one-stop shopping
convenience and the
best value to its
customers. The
company continues to
provide good products,
8 services, and business
opportunities to the
Filipino people.
8

Table 6. Prioritized classic SWOT Analysis (ANGELICA)

Positive factors Ratings Negative factors Ratings
Internal factors Resource strengths: Resource
● Customer weaknesses:
perk, loyalty 10 ● Rising 5
program, and competition
reward system among
● Branded as industry
one of the 9 players
leading 6
Final Paper: Puregold Price Club, Inc.

supermarkets, ● Outdated
hypermarkets, technology
and retail ● Limited 5
stores in the portfolio of
Philippines high-margin
● Commendable items
accessibility 8 ● Too many 5
of a location taxes needed
to the target to be paid
market
● Numerous
branches 8
External Market and Market and industry
factors industry threats:
opportunities:
● Puregold ● Increase in
Membership 10 Credit card 63
Card: Aling frauds.
Puring Card ● Increase in 45
gives out Labor Cost.
more benefits ● Technological 36
than its Costs.
competitors. ● External 42
● Eco Bags Business Risk.
since the 9
launch of the
“I am not a
plastic bag”.
● Online 8
consumers use
the Internet
for grocery
shopping.
● New products
and Services 8
Final Paper: Puregold Price Club, Inc.

d.
Table 7. Strategic issue analysis (NICHOLE)

Description of strategic Strategic questions Rationale/Motivation for

issue surrounding the issue the importance of the issue
External

● Foreign exchange ● How do you work out ● Calculate an exchange

rates change. the exchange rate rate every time.
● Smaller players are changes? ● Turn the Competitor’s
furious ● How to deal with weakness into your
competitors. small competitors? strengths.
● Entrants of new ● How do you overcome ● Focus on the needs of
players. competitive rivalry? your customers and
don't focus on your
competitor.

Internal

● Lack of customer ● How to improve the ● Contact your

appreciation. customer’s loyalty? customers regularly.
● Outdated ● How to avoid outdated ● Never stop thinking
Technology. technology in the about growth.
● Arrangement of company? ● Find ways to appeal
goods is not proper ● How to improve the to multiple senses.
(e.g soap brands arrangement of goods? ● Provide employees
are stacked beside ● How to manage labor with predictable work
candy items). costs? schedules.
● Increase in Labor
Cost
Final Paper: Puregold Price Club, Inc.
e.
Table 8. Theory of the business sights analysis (RAYN)
Sight lens
Key foresights (future
developments, possibilities,
opportunities and threats)
Key insights (rare, distinctive
and valuable capabilities,
resources, assets)
Key cross-sights
(complementarities that create
value)
Description
● They wanted to sustain
the growth of the
company by expanding
it and adapting the
online platform to be
more convenient for
their customers.
● They give more benefits
and incentives to their
loyal customers.
● Different circumstances
will put the business in
danger.
● Through this Puregold
loyalty program the
customer can gain
benefits, incentives, and
promo. By doing this
they can easily get the
interest of every small
store to being their
partner.
● Never stop expanding
will help them to sustain
their growth nationwide.
These include 413
Puregold stores, 20
S&R membership
shopping warehouses,
and 46 S&R New York
Style QSR.
● To extend their business
they start a new
business, with the help
of the smaller stores that
Strategic implication
● Expanding for 25
more Puregold
stores and 2 S&R
membership
shopping
warehouses in
2020. They are
planning to offer
online grocery
shopping to 100
stores from the
current 40 stores in
their app.
● Puregold
Membership card;
Tindahan ni Aling
Puring membership
card.
● External business
risk.
● The puregold
loyalty program:
puregold perks
card and "Tindahan
ni Aling puring".
● Puregold has a
total of 479 stores
nationwide as of
2021.
● Aling Puring Store
is a customized
program made
especially for
Final Paper: Puregold Price Club, Inc.

are purchasing them. Puregold’s primary

They are giving customers which
discounts, promo, and include sari-sari
different incentives to store owners,
attract them to be part of eateries, canteens,
Tindahan ni Aling catering, bulk
Puring. buyers,
wholesalers, and
other resellers.
Through this
strategy, they are
providing
seminars, training,
and even sari-sari
store conventions
for the enrichment
of the
entrepreneurial
knowledge of
every loyal
customer that they
have.