SHAKEY’S PHILIPPINES: A MANAGEMENT AUDIT

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A Management Audit Research

Submitted to

Mrs. ALMIRA A. CASTILLO

Instructor, Business and Management Department

La Carlota City College
La Carlota City, Negros Occidental

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In Partial Fulfillment for the Requirements

Of the subject

MA 34 (Management Accounting Research)

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ARABELLE R. GA
ALJON BAJALA
JIIJI T. DALANON
KIER CHINO T. PACENIO
SHAINA S. ROQUERO
 Chapter 1: INTRODUCTION

Background of the Study

Pizza have been a common food for individuals, in one form

or another, for centuries. Even ancient times, pieces of

flatbread, topped with savories, served as a simple and tasty

meal for those who could not afford plates, or who were on the

go. Everyone loves pizza – pretty much everyone who tries it

develops an instant affection for it – and its history is just as

interesting as some of the topping combinations that have emerged

around the world, some of which are rather unusual. (Alexander

Lee, 2018)

Though considered as a casual fine dining restaurant, Shakey’s,

Philippines is famous for their pizza product.

Shakey’s has been one of the country’s fast foods chains for

delicious thin-crust pizzas and addictive mojos. Shakey’s is the

pizza that started in line with the food industry when they

became the first franchise pizza chain in the United States. It

expanded to the Pacific Rim including the country of Japan and

Philippines in which the Philippine Branch was under the

ownership of the country’s largest food conglomerate- San Miguel

Corporation, primarily to promote their San Miguel draft beer.

Despite the highly competitive restaurant scene, the brand has

withstood changing tides and continues to be a place where family

and friends make memories. Given this well-rooted position in the

restaurant industry, Filipinos often associate the brand as being

a home grown one, when in fact, Shakey’s was founded in America—

it just gained more traction in Asia. (Nicole Cruz, 2019)

Objective of the Study

This study conducted to assess the following:

1. To evaluate the financial performance of Shakey’s Asia

Ventures for the past three years.

2. To be able to make a comparative trend analysis

3. To be able to determine possible course of action

Significance of the Study

Shakey’s business is a great business. Shakey’s its

opportunities with the right partners who trust in the shakey’s

name, who grown to 100 stores nationwide and still growing.

The result of this study would provide valuable information to

the following:

Board of the Director. Result of the study will oversee the

reliability of company’s financial statements and disclosures.

Manager and Staff. Result of the study will evaluate the

management team in its effectiveness to work.

General Assembly. Result of this study will give information to

the members of the company that they have a great part in the

grown success of the Shakey’s Philippines.

Potential Investors. Result of the study will provide information

that will able to know if the business is worth investing.

Future Researcher. This study will be provide information and can

be use as a guide or reference for future use.

Definition of terms

Business-refers to organizations that seek profits by providing

goods or services in exchange for payment.

Financial Performance- refers to the degree to which financial

objectives being or has been accomplished and is an important
aspect of finance risk management.

Financial Statements- written records that convey the business

activities and the financial performance of a company.

Comparative Trend Analysis- a method of analyzing your

competitors and comparing how your site or tool performs in

relation to the competition.

Board of the Director- the governing body of a company, elected

by shareholders in the case of public companies to set strategy
and oversee management.

Staff- the people employed by a particular organization.

Managers- a person responsible for controlling or administering

all or part of a company or similar organization.

Fast Food- a type of mass-produced food designed for commercial

resale and with a strong priority placed on "speed of service"

Franchise- refers to a small business owner who purchases the

right to use an existing business's trademarks, brands, and
proprietary knowledge.
General Assembly- a meeting of all the members of an organization
or shareholders of a company.

Chapter 2. ORGANIZATIONAL PROFILE

Name of the Agency: Shakey’s Philippines

Type of Agency: Fast Casual Restaurant

Location: Shakey’s WOW Center, 15KM East Service Road corner Marian

Road 2, Barangay San Martin de Porres, Parañaque City,

Philippines 1700

Brief History

Shakey’s Pizza was founded on April 30, 1954, in Sacramento,

California, where Johnson and Plummer remodeled a grocery store

as the brand’s inaugural branch. Funnily enough, the

establishment didn’t serve pizza on its opening day because the

ovens weren’t functioning yet, so they only served beer. The

sales from its beer went into completing the pizza ovens.

Shakey’s is one of the leading operators of Fast Casual

Restaurants in the Philippines, focused on family casual dining.

In 2020, Euromonitor reported Shakey’s as the market leader in

both chained pizza full-service restaurant and chained full-

service restaurant, with market shares of 29.6% and 67.3%, way

ahead of other competition in the industry.

Shakey’s target market consists of the A, B, and upper C income

class segments that prefer full-dining restaurants over fast-food

establishments. Shakey’s attracts families and groups through its

meal bundle offerings and party-size portions that are ideal for

sharing.

Vision Statement

OUR VISION

To be the leading and preferred Family Casual Dining Restaurant,

serving pizza as its core product.

Mission Statement

OUR MISSION

TO OUR GUEST:

We genuinely care for our guest. We seek to know their needs and

wants so we can provide them high quality food products and

services at great value for money.

TO OUR EMPLOYEES:

We nurture an environment where people are respected and

empowered to be their best. We create opportunities for personal

and career growth so they may succeed and gain a sense of

achievement and pride.

TO OUR SHAREHOLDERS:
 We grow the business by increasing the size and value of the

company and by achieving industry leading returns on investment.

TO OUR BUSINESS PARTNERS:

We are fair, professional and collaborative business partner.

TO OUR COMMUNITY:

We recognize our responsibility to contribute to nation building

through job creation and by having a positive impact in our

communities.

Functional Statement, Objectives and Expected Results

Organizational Structure

Duties & Responsibilities

Property and Supply Management

Shakey’s Pizza procures materials only from approved suppliers.

The approval process requires a food quality and safety

assessment, and an audit by our quality assurance officers to

ascertain that the supplier’s quality management satisfies our

requirements as well as a globally-accepted standard set of

criteria that covers food safety practices, microbial hazards

assessments, employee and facility sanitation, and end product

analysis. Standard safety and quality audits are also conducted

for dispatching activities to our stores. The inspection extends

from the delivery vehicles’ compliance to hygiene and temperature

requirements, quality of finished products, and safety up to the

packaging interior before dispatch. Ensuring food safety and

quality in all our stores is a paramount commitment of Shakey’s

Pizaa. We consistently promote proper food safety practices

throughout our production process. Our food safety and quality

processes have always been aligned with the highest standards

required in the industry. We also continue to remain vigilant in

our sourcing of raw materials with the conduct of strict quality

assurance. Our QSCH internal audit is conducted across all our

stores thrice a year as internal validation of compliance to our

set standards. Stores are assessed on product freshness, storage,

food preparation, service and hospitality, cleanliness and

conditions of stores, and systems compliance. The third-party

audit, on the other hand, is executed by Mystery Guests who

appraise our stores on service and hospitality, cleanliness and

conditions of stores, and food quality.

Policies and Procedures

The Company observes the provisions of the Corporation Code

relating to interested directors and officers.

All Related Party Transactions (1) are covered by individual

agreements ensuring that they are arms-length and (2) are

disclosed regularly to shareholders, the SEC, and the PSE as part

of the Company’s Financial Statements and Annual Report to

Shareholders.

Any Related Party Transaction shall be reported to the Audit

Committee, which shall review the material facts of all Related

Party Transactions and either approve, disapprove or ratify such

transactions. The Audit Committee shall report all Related Party

Transactions to the Board of Directors.

 Conflicts of Interest

The Po Family, through Century Pacific Group, Inc., has control

of the Company and its subsidiaries. Several members of the Po

Family also serve in various capacities as directors and officers

of the Company and its subsidiaries

 Mechanism

The responsibility for avoiding conflict of interest rests with

the Directors/Officers/Significant Shareholders. Every Director/

Officer/Significant Shareholder should disclose in writing any

possible conflict of interest as soon as detected and other

relevant information whenever they arise.

As of date, there are no disputes between the Company and any of

its stockholders, third parties and regulatory authorities that

would require adoption of an alternative dispute resolution

system. Some agreements and partnerships have defined agreements

regarding alternative dispute resolution via arbitration.

The Company’s policies on the following business conduct and

ethics affecting the directors, senior management, and employees

are discussed below:

 Conflict of interest

All employees, irrespective of rank, should always act in the

best interest of the Company. All conflict of interest shall be

avoided and prohibited. In the event that such will occur,

disclosure must be made to the immediate supervisor or human

resources head

 Receipt of gifts from third parties

All employees are prohibited from accepting gifts based on the no

gift policy of the Company.

 Respect for trade secrets and use of non-public information

All employees are required to sign and adhere to a

confidentiality agreement. All employees are prohibited from

disclosing or using to their own advantage any non-public

information.
  Conduct of business and fair dealings

Business is dictated by free competition - no monopoly and no

price manipulation. Price is dictated by supply and demand.

Employees are required to comply with fair trade practices.

 Compliance with laws and regulations

All employees, in the conduct of business, are obliged to comply

with all relevant laws and regulations.

 Use of company funds, assets, and information

All employees are required to act as responsible custodians of

all company funds, assets, and information. As such, all are

required to protect and preserve company assets.

 Employment and labor laws and policies

The Company complies with all existing employment and labor laws

and policies.

 Whistle-blower

The Company has a whistle-blower policy that provides an avenue

for employees to report misconduct of fellow employees, including

their superiors, while protecting the employee’s identity and

welfare.

Linkages of the General Services Offices

Shakey's has been creating over 40 years of great times and great

memories in the Philippines. Having started its first store in

Metro Manila way back in 1975, Shakey's now operates nationwide

with a strong store count of 307 stores, comprising of 171

Company-owned stores and 136 franchised stores.