CHAPTER II

MARKET STUDY

This chapter specifically identify if there is an adequate demand for the

product in the market. It gives emphasis on the definition and description of

the business industry.

Ideas are presented through paraphrasing style and introductory paragraph is

required before each specific presentation of the sub section of market study.

A. BUSINESS PRODUCT/SERVICE

Table 2.1. The Product, Product description and Price

PRODUCT
PRODUCT PRICE
DESCRIPTION
Chocolate Donuts are a
classic and beloved treat,
offering a delightful
combination of sweet,
Chocolate Donuts chocolaty flavor and a soft, ₱30
fluffy texture. They are Per piece/₱120 per pack
perfect for satisfying a
chocolate craving and can
be enjoyed for breakfast, a
snack, or desserts.
Strawberry Donuts are a
popular choice for those
Strawberry Donuts who enjoy sweet and fruity ₱30
treat. They offer a delightful Per piece/₱120 per pack
combination of the classic
doughnut texture with the
 refreshing flavor of
strawberries.
White Chocolate Donuts are
a decadent treat, offering a
combinations sweetness,
creamy texture, and
White Chocolate Donuts delightful vanilla flavor. ₱30
They are a popular choice Per piece/₱120 per pack
for those who enjoy the
classic taste of doughnuts
with a touch of white
chocolate indulgence.
Choco Almonds Donuts are
delightful combination that
caters to the cravings of
chocolate and nut
Choco Almonds Donuts enthusiasts. The rich, ₱30
creamy chocolate paired Per piece/₱120 per pack
with the crunchy goodness
of almonds creates a
satisfying treat that’s hard
to resist.
Cookies and Cream
doughnuts are a delightful
combination of sweet,
creamy vanilla or chocolate ₱30
Cookies and Cream and the classic chocolaty Per piece/₱120 per pack
crunch of Oreo cookies.
They are a popular and
decadent treat enjoyed by
people of all ages.

PRICING STRATEGY

The pricing strategy will be focused on maintaining competitive pricing while

considering the premium experience Donut Carousel will offer.
• COST-BASED PRICING: It will determine the cost of ingredients, production, labor,
and other overhead expenses associated with the creation of the donuts. A suitable
profit margin will be added to determine the base price.
 Table 2.2. Costing

Name of Dish Chocolate Donuts

Standard Yield

INGREDIENTS UNIT OF UNIT COST PORTION SIZE TOTAL COST

MEASURE CURRENT CURRENT

Donut Dough

1 Egg ₱
Oil 2 tbsp ₱
Fresh Milk 3/4 cup ₱
Sugar 1 tbsp ₱
Salt 1 tsp
Baking Powder 3+1/4 cup
All purpose 2+1/2 cups
flour
Oil 1 liter

Filling

Toppings

₱
₱
₱
₱

Total Cost ₱
Total Cost Per Serving ₱
Cost ratio ₱
Computed Price per Serving ₱
VAT 12% ₱
Total Price Per serving ₱
Recommended Price Per Serving ₱
 Table 2.3. Costing

Name of Dish Strawberry Donuts

Standard Yield
INGREDIENTS UNIT OF UNIT COST PORTION TOTAL COST
MEASURE CURRENT SIZE CURRENT

Donut Dough
1 Egg ₱
Oil 2 tbsp ₱
Fresh Milk 3/4 cup ₱
Sugar 1 tbsp
Salt 1 tsp
Baking Powder 3+1/4 cup
All purpose 2+1/2 cups
flour
Oil 1 liter ₱
Filling
₱
Toppings
₱
₱
₱

Total Cost ₱
Total Cost Serving ₱
Cost Ratio ₱
Computed Price per Serving ₱
VAT 12% ₱
Total Price per Serving ₱
Recommended Price per Serving ₱
 Table 2.4. Costing

Name of Dish White Chocolate Donuts

Standard Yield
INGREDIENTS UNIT OF UNIT COST PORTION TOTAL COST
MEASURE CURRENT SIZE CURRENT

Donut Dough
1 Egg
Oil 2 tbsp
Fresh Milk 3/4 cup
Sugar 1 tbsp
Salt 1 tsp
Baking Powder 3+1/4 cup
All purpose 2+1/2 cups
flour
Oil 1 liter
Filling

Toppings

Total Cost
Total Cost Serving
Cost Ratio
Computed Price per Serving
VAT 12%
Total Price per Serving
Recommended Price per Serving

Table 2.5. Costing

Name of Dish Choco Almonds Donuts

Standard Yield
INGREDIENTS UNIT OF UNIT COST PORTION TOTAL COST
MEASURE CURRENT SIZE CURRENT

Donut Dough
1 Egg
Oil 2 tbsp
Fresh Milk 3/4 cup
Sugar 1 tbsp
 Salt 1 tsp
Baking Powder 3+1/4 cup
All purpose 2+1/2 cups
flour
Oil 1 liter
Filling

Toppings

Total Cost
Total Cost Serving
Cost Ratio
Computed Price per Serving
VAT 12%
Total Price per Serving
Recommended Price per Serving

Table 2.6. Costing

Name of Dish Cookies and Cream Doughnut

Standard Yield
INGREDIENTS UNIT OF UNIT COST PORTION TOTAL COST
MEASURE CURRENT SIZE CURRENT

Donut Dough
1 Egg
Oil 2 tbsp
Fresh Milk 3/4 cup
Sugar 1 tbsp
Salt 1 tsp
Baking Powder 3+1/4 cup
All purpose 2+1/2 cups
flour
Oil 1 liter
Filling

Toppings

Total Cost
 Total Cost Serving
Cost Ratio
Computed Price per Serving
VAT 12%
Total Price per Serving
Recommended Price per Serving

Table 2.7. Costing

SALES FORECAST

A sales forecast is a detailed report that forecasts how much a salesperson, team,
or company will sell on a weekly, monthly, and annual basis. Typically, sales predictions
are developed using historical performance data. Sweet O anticipates a 5% rise in sales
income over the next five years.
The Sweet O sales projection table illustrates annual sales forecast.

Table 2.8. Daily Target Sale of Sweet O’s

Gross Sale/ Target

ITEMS Price Quantity Sold
Sale

CUSTOMER

This section is intended to identify the life and blood of every business which are
the customers. There is a need to be specific in identifying and providing description of
the business target market. Presenting relevant demographic, psychographic and
behavioral factors that might affect the business is necessary on this section. The clear
plan on how the target market will be benefited from the product and services offered
should also be presented. Sources of data can be through demographic analysis or
conducting community research on the location of the proposed business.

Market Competition

Table 2.9. Indirect Competitor

 Name of Establishment Description
Bakeries Bakeries are major competitors, offering a wider variety of
baked goods like cakes, cookies, pies, and breads, which can
be substitutes for donuts.
Convenience stores Convenience stores often have a selection of pre-packaged
pastries and donuts, offering a quick and convenient option
for customers on the go.
Grocery stores Grocery stores have a large bakery section with various
baked goods, including donuts, often at lower prices than
specialized donut shops.
Fast-food restaurants Some fast-food chains offer breakfast menus with pastries
and breakfast sandwiches, which can be seen as alternatives
to donuts.

Channel of Distribution

Costumer/Consumer
Distributor

Figure 2.1. Sweet O Channel Distribution

In this distribution channel will be DISTRIBUTOR to the costumer, it will reach the
customer store-only in the University of Eastern Pangasinan. The channel of distribution is
the pathway of the business to sell the products to end consumers.

Market Share

In the pastry shop industry, it’s important to acknowledge the presence of

competition and competitors. Specifically, we should consider local cafes and milk tea
shops as our main rivals in the business. By understanding their strengths and
weaknesses, we can craft improved strategies to thrive in the competitive market and
ensure the sustainability of our pastry shop.
 Figure 2.2. Market Share

Desert Store has the biggest market share that consists of (64.9%) of the total
market. Next is Grocery Store has a total market share of (15.6%). While the Homemade
deserts with a total of (11.7%).

Survey Result

Survey of Demand from the Target Market

 Figure 2.3. Classification of Respondents According to Age

Based on the online survey conducted, the table shows that the highest age is less than 23
with a total of (6.5%). Followed by the age of 8-1 with a total of (16.9%). And lastly by the
age of 8 with a total of (68.8%).

Figure 2.4. Classification Respondents to According to their Gender.

Based on the online survey that we conducted, the table shows that the highest gender is
Male with a total of 51 which is (51%) respondents and followed by Female with a total of
49 which is 49%) respondents.
Figure 2.5. Classification of Respondents According to what time the respondent what to
eat doughnut.

Based on the online survey conducted, that table shows that the vast majority (84.4%) of
respondents prefer to have doughnuts for snack. Doughnuts are also a popular choice for
breakfast (6.5%). And other is least preferred by the respondent.

Figure 2.6. Classification of Respondents According to how the respondent like desert.

Based on the online survey conducted, The most of the respondents (58.4%) really like
dessert much. It is followed by those who somewhat like it (22.1%). A smaller percentage
of respondents either they somewhat like it (9.1%) or they don’t like it much (7.8%).
There seems to be no respondents who dislike dessert the most.
Figure 2.7. Classification of Respondents According to the preferred doughnut flavor by
the people.

Based on the online survey conducted, the table shows that the chocolate was the
overwhelming favorite, with 58.4% of the vote. Strawberry (26%) and caramel (19.5%)
were the second-most popular choices, followed by mocha (15.6%) and red velvet
(15.6%). And the vanilla and the other was the least popular among the choices

SWOT Analysis

Swot analysis is useful technique for understanding the strengths and weaknesses,
and for identifying the both the opportunities open to you and the threats you face.

Strengths:

- Product Quality Excellence

- Safety and Security in Service
- High Service Standards

Weaknesses:

- High Expenses
- Challenges in Supplier Sourcing
- Competitive Pressure

Opportunities:

- Introduce New Products and Innovation

- Enhance Brand Visibility Through Advertising
- Implement Home Delivery App
- Explore Innovative Methods
- Strengthen Customer and Staff Relationships

Threats:

-
Increasing Supply Costs
- Low Profit Margins
- Price Sensitivity
- Business Risks and Weaknesses
- Competition in Delivery Services
 Business Mission and Vision

MISSION
Sweet O aims to cultivate an environment in the pastry shop that encourages artistic
Expression, nurtures creativity, and brings people together through a shared passion for
Art and sweet indulgences. The mission encompasses delivering an exceptional pastry
Experience, showcasing local talents, supporting the artistic community, and providing a
Welcoming space for customers to unleash their creativity while savoring delectable
Pastries.

VISION
Our vision is to establish Sweet O as a premier destination, earning the trust of our
customers and satisfying their sweet cravings. By achieving this, we aspire to influence
Coffee culture significantly, becoming the top choice for coffee enthusiasts in Pangasinan.

Figure 2.8. BUSINESS LOGO

We design a straightforward yet visually appealing logo for our business, which
Helps establish brand recognition, convey our identity and values, set us apart from
 Competitors, boost professionalism and credibility, visually communicate information,
Maintain consistency, and support marketing and branding initiatives.

MARKETING SALES AND STRATEGY

Sweets O aims to attract a daily customer base of 50 individuals by delivering

Exceptional services and crafting delicious pastries. Our team prioritizes serving Customers
with care and warmth. The goal is to achieve a consistent monthly sales
Growth of 20 patrons. Building a compelling and recognizable brand identity for our
Pastry shop is crucial. This involves crafting a narrative for the shop, curating a
Welcoming ambiance, and ensuring that staff attire aligns with the brand’s essence. Every
aspect should convey a unified and captivating message to our patrons. Introducing a
customer loyalty program tailored for the pastry shop can foster repeat Business.
Providing incentives like rewards, discounts, or complimentary treats to loyal Customers
can foster a dedicated clientele and boost overall sales.

THE 4P’S OF MARKETING AND SALES STRATEGY

PRICING

Sweet O pricing pertains to the amount customers are charged for the products
offered at the pastry shop. It is crucial to establish pricing tactics that resonate with the
target audience and reflect the perceived value of the items. Factors like ingredient costs,
operating expenses, and competitor price points should be taken into account when
establishing the pricing structure.

PROMOTION

Promotion encompasses the marketing and communication techniques employed

to raise awareness and draw customers to the pastry shop. This entails advertising, social
media campaigns, public relations efforts, and various promotional initiatives. Tailor these
strategies to the target market and utilize effective tools such as flyers and posters to
promote the pastry shop effectively.

PRODUCT

In a pastry shop, the products consist of delectable sweet treats that encompass a
blend of quality, variety, and uniqueness in their offerings. It is imperative to take into
account elements like flavor, visual presentation, and the holistic experience that
customers will encounter when indulging in these confections. Crafted with precision and
creativity, these sweet delicacies aim to captivate taste buds, delight the eyes, and create
memorable moments for patrons within the pastry shop ambiance.
 PLACE

Sweet O is situated close to the University of Eastern Pangasinan in Binalonan,

Pangasinan, providing students with a cozy environment to unwind and relish in a sweet
ambiance.

Figure 2.9. Sweet O’s Menu.

 Figure 2.10. Sweet O’s Flyer.

Figure 2.11. Sweet O’s Loyalty Card

Flyers help create brand awareness by showcasing the coffee shop’s logo, name,
and visual elements. This helps customers recognize and remember the coffee shop when
they see the flyer or encounter the brand elsewhere. Flyers are an excellent way to
promote special offers, discounts, or limited-time deals. By featuring these promotions on
the flyer, coffee shops can encourage customers to visit and try their products. Flyers can
be used to introduce new coffee flavors, seasonal drinks, or food items. By showcasing
these new offerings with attractive visuals and enticing descriptions, coffee shops can
generate curiosity and interest among customers.
 Figure 2.12. Sweet O’s Instagram

Figure 2.13. Sweet O’s Facebook Page

This proposed business has its own Facebook where people can see the product
menu, pricing, etc. And for people to know there is a new business.