NORTHEASTERN MINDANAO COLLEGES

Surigao City

FINAL PROJECT

IN

ELEC 2

FRANCHISING

GENERIKA DRUGSTORE

Submitted by:

CHARIROSE L. GUMATO

Student

Submitted to:

NOE BEHAGAN, MBA, PhD

Instructor

FIRST SEMESTER 2023-2024

About the Company
Corporate History/Profile
Board of Directors and Corporate Officers
Management Team
Organizational Chart
Conglomerate Map/ Locations of the Outlets
Articles of Incorporation and By-Law

Corporate Governance
Manual OF Corporate Governance
Code of Business Conduct and Ethics
Annual Corporate Governance Report
Board Committees
Corporate Social Responsibility and Sustainability
Risk Management
Company’s Policies
Company’s Stakeholders
Private Policy

Company Disclosures
SEC Filings( Audited Financial Statements 2022)
Minutes of Annual/Special Stockholders Meeting
Other Disclosures

Franchising
Application Information and Details
Qualifications and Procedures

Marketing
Product
Price
Place
Promotion
Physical Evidence
People
Process

Others
Documentations and Pictorials
 Corporate History
Generika Drugstore was formed just as Teodoro Ferrer was about to wind down his career in
the corporate world. Ted was 60 years old and a retiree from the Ayala Group of Companies
when he established Generika Drugstore with co-founder, Julien Bello, a Frenchman in his early
30s who came to the Philippines to do social work. Julien had personally seen the plight of
workers and families in the low-income sectors who were sick but could not afford the high
prices of the prescribed branded medicines.

The business venture was quite risky. Both Julien and Ted had no knowledge of
pharmaceuticals and the retail industry, and they would have to start from zero. The biggest
challenge was how to overcome the negative public perception of generic medicines, to
generate sales, and eventually become a viable and sustainable enterprise. Both founders were
aware about the huge risks, and anticipated large losses during the initial years.

Since medicines are adversely affected by heat and humidity, the founders decided to air-
condition the stores to preserve the efficacy and quality, even if it meant higher costs. Most
drugstores then, and even now, were not air-conditioned. Only quality generics were carried in
order to give real value health benefits to customers. Community services, such as free medical
consultations (Libreng Konsulta), were made an integral part of store operations. Diagnostic
services, like blood sugar testing were provided at subsidized rates. Store operations were fully
computerized to have better control.

Ted’s decision to invest and wholeheartedly involve himself in Generika Drugstore was inspired
by his father.

“My father was a doctor in Zamboanga City who practiced until the age of 83. He had many
prominent families as clients, but he also had a powerful drive to help poor people. I grew up
witnessing my father treat as many as one hundred patients a day from impoverished
communities, and he was charging them only two pesos as professional fee. This was at the
time when other doctors were charging Php150 up to Php200.”

That memory created an impact on Ted and it stayed with him for many years. When the
opportunity came, it was clear to Ted that he wanted to continue his father’s legacy of providing
basic healthcare to people in the lower income sector. At the age of 73, Ted continues to be
involved and committed to the business he co-founded, and for which he has earned recognition
for the pioneering efforts.

The most visible achievement is that Generika Drugstore will have a nationwide network of 747
stores by the end of 2017. Moreover, what gives Ted tremendous personal satisfaction is that
the initiative of Generika Drugstore has inspired others to set up their own generic pharmacies,
and the combined effect is that people are now the ones looking and asking for generic
medicines which have become available throughout the country.
Franchising Generika Drugstore has provided 268 small entrepreneurs the opportunity to
have their own businesses. Franchise stores currently account for 87% of total stores.
Generika Drugstore is committed to open many more franchise and company-owned stores
in the years ahead.

“We are able to give retirees, Overseas Filipino Workers, and young entrepreneurs who
want to have their own business a proven business model through franchising.”

Generika Drugstore presently has 829 organic employees at the head office, the Cabuyao
warehouse, and in the 95 company-owned stores. About 3,000 people are employed by the
franchise stores.

An interesting development happened recently when Julien Bello decided to transfer his
family to Paris for good. He offered his shares to interested investors, and one of them was
Ayala Corporation. Needless to say, Ted endorsed his former employer, and thus the 50%
share of Julien was sold to AC Health in July 2015. After Ted retired from the Ayala Group
in 2004, 11 years later he found himself to be with Ayala again but this time as a business
partner.

With Ayala in the picture, a top-level review of the corporate objectives of Ayala and
Generika Drugstore was done, and were found to be aligned. Since then, many changes
have been made to upgrade the organization, improve compensation and benefits,
strengthen operations and corporate governance, and in general, to level up Generika
Drugstore to the standards of the Ayala Group. The brand equity of Generika Drugstore was
also appreciably bolstered by the entry of Ayala.

Ted is known as a hardworking person with a positive mindset and determination to

succeed despite hardships and failures. He tends to take a long-term view, sets high
targets, but keeps his feet firmly on the ground. He wants to give back to others as he has
received many blessings in life.

Ted’s business story is unique and motivating to other people. To put up a disruptive
business venture at age 60 and successfully grow the company and sales to P3.2 billion 14
years later debunks the myth that entrepreneurship belongs to the young and the bold. He
has paved the way for other retirees and near-retirees to ride a second wave of
entrepreneurial career success after corporate life.

Being in the business of healthcare has influenced Ted to be a staunch advocate of health
and wellness. He is affectionately known as a modest and supportive leader, determined to
continue the aggressive expansion of the Generika Drugstore store network to penetrate
and serve even the remote municipalities of the country.
The corporate vision of Generika Drugstore is to be the most innovative national drugstore chain
providing quality affordable healthcare with a strong sense of social purpose. It shall be at the
forefront of customer satisfaction.

Ted’s missions are to make quality affordable healthcare available to millions of Filipinos
especially the less fortunate and to promote health and wellness. He always believed that
prevention is far better and more affordable than a cure.

Generika Drugstore has immensely grown compared to its early years and is continuously
expanding – and that’s what gratifies Ted the most. It feels fulfilling to know that customers are
grateful that Generika Drugstore has made a significant difference in their health and life, that it
has provided gainful employment and opportunities for advancement to many people, and that
franchisees are successful and expanding their stores.

“It is not enough to dream. At the end of the day, results are what count.”

Ted Ferrer was born and raised in Zamboanga City in Mindanao. At an early age he was
already an achiever as he graduated as the High School as Valedictorian at Ateneo de
Zamboanga in 1960. He took AB Economics in Ateneo de Manila and finished his Master’s
Degree in Business Management there two years later.