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Salesmanship
Final Examination
10/31/2012
Jinky Jane Hally
Table of Contents
Title Page
Maslow's hierarchy of needs………………………………………….1Hezberg’s Motivation-Hygiene Theory…………………………….2Universal Robina Corporation………………………………………...9
History of the company…………………………………………….10Executive personnel…………………………………………………13Personnel and labor relations……………………………………17Plants and branches…………………………………………………19Organization……………………………………………………………31Distribution methods………………………………………………..33Research and Investigations……………………………………..35Competitive information……………………………………………37
1. Discuss and differentiate the two theories of motivation,
Maslow’s Hierarchy Theory and Hezberg’s Theory.
2
Maslow's Hierarchy of Needs
Maslow's hierarchy of needs is often portrayed in the shape of a
pyramid, with the largest and most fundamental levels of needs at the
bottom, and the need for self-actualization at the top. While the
pyramid has become the de facto way to represent the hierarchy,
Maslow himself never used a pyramid to describe these levels in any of
his writings on the subject.
The most fundamental and basic four layers of the pyramid contain
what Maslow called "deficiency needs" or "d-needs": esteem,
friendship and love, security, and physical needs. With the exception of
the most fundamental (physiological) needs, if these "deficiency
3
needs" are not met, the body gives no physical indication but the
individual feels anxious and tense. Maslow's theory suggests that the
most basic level of needs must be met before the individual will
strongly desire (or focus motivation upon) the secondary or higher
level needs.
The human mind and brain are complex and have parallel processes
running at the same time, so many different motivations from different
levels of Maslow's pyramid usually occur at the same time. Maslow was
clear about speaking of these levels and their satisfaction in terms
such as "relative" and "general" and "primarily", and says that the
human organism is "dominated" by a certain need, rather than saying
that the individual is "only" focused on a certain need at any given
time. So Maslow acknowledges that many different levels of motivation
are likely to be going on in a human all at once. His focus in discussing
the hierarchy was to identify the basic types of motivations, and the
order that they generally progress as lower needs are reasonably well
met.
Hezberg’s Motivation-Hygiene Theory
The Two-factor theory (also known as Herzberg's motivation-
hygiene theory and Dual-Factor Theory) states that there are
certain factors in the workplace that cause job satisfaction, while a
separate set of factors cause dissatisfaction. Frederick Herzberg, a
4
psychologist, who theorized that job satisfaction and job dissatisfaction
act independently of each other, developed it..
Two-factor theory fundamentals: Attitudes and their connection with
industrial mental health are related to Maslow's theory of motivation.
His findings have had a considerable theoretical, as well as a practical,
influence on attitudes toward administration. According to Herzberg,
individuals are not content with the satisfaction of lower-order needs at
work, for example, those associated with minimum salary levels or safe
and pleasant working conditions. Rather, individuals look for the
gratification of higher-level psychological needs having to do with
achievement, recognition, responsibility, advancement, and the nature
of the work itself. So far, this appears to parallel Maslow's theory of a
need hierarchy. However, Herzberg added a new dimension to this
theory by proposing a two-factor model of motivation, based on the
notion that the presence of one set of job characteristics or incentives
lead to worker satisfaction at work, while another and separate set of
job characteristics lead to dissatisfaction at work. Thus, satisfaction
and dissatisfaction are not on a continuum with one increasing as the
other diminishes, but are independent phenomena. This theory
suggests that to improve job attitudes and productivity, administrators
must recognize and attend to both sets of characteristics and not
assume that an increase in satisfaction leads to decrease in
unpleasurable dissatisfaction.
The two-factor, or motivation-hygiene theory, developed from data
collected by Herzberg from interviews with a large number of
engineers and accountants in the Pittsburgh area. From analyzing
these interviews, he found that job characteristics related to what an
individual does — that is, to the nature of the work he performs —
apparently have the capacity to gratify such needs as achievement,
5
competency, status, personal worth, and self-realization, thus making
him happy and satisfied. However, the absence of such gratifying job
characteristics does not appear to lead to unhappiness and
dissatisfaction. Instead, dissatisfaction results from unfavorable
assessments of such job-related factors as company policies,
supervision, technical problems, salary, interpersonal relations on the
job, and working conditions. Thus, if management wishes to increase
satisfaction on the job, it should be concerned with the nature of the
work itself — the opportunities it presents for gaining status, assuming
responsibility, and for achieving self-realization. If, on the other hand,
management wishes to reduce dissatisfaction, then it must focus on
the job environment — policies, procedures, supervision, and working
conditions. If management is equally concerned with (as is usually the
case), then managers must give attention to both sets of job factors.
The theory was based around interviews with 203 American
accountants and engineers in Pittsburgh, chosen because of their
professions' growing importance in the business world. The subjects
were asked to relate times when they felt exceptionally good or bad
about their present job or any previous job, and to provide reasons,
and a description of the sequence of events giving rise to that positive
or negative feeling.
Here is the description of this interview analysis:
Briefly, we asked our respondents to describe periods in
their lives when they were exceedingly happy and unhappy
with their jobs. Each respondent gave as many "sequences
of events" as he could that met certain criteria—including a
marked change in feeling, a beginning and an end, and
contained some substantive description other than feelings
and interpretations…
6
The proposed hypothesis appears verified. The factors on
the right that led to satisfaction (achievement, intrinsic
interest in the work, responsibility, and advancement) are
mostly unipolar; that is, they contribute very little to job
dissatisfaction. Conversely, the dissatisfiers (company
policy and administrative practices, supervision,
interpersonal relationships, working conditions, and salary)
contribute very little to job satisfaction.
Two-factor theory distinguishes between:
Motivators (e.g. challenging work, recognition, responsibility)
that give positive satisfaction, arising from intrinsic conditions of
the job itself, such as recognition, achievement, or personal
growth, and
Hygiene factors (e.g. status, job security, salary, fringe
benefits, work conditions) that do not give positive satisfaction,
though dissatisfaction results from their absence. These are
extrinsic to the work itself, and include aspects such as company
policies, supervisory practices, or wages/salary.
Essentially, hygiene factors are needed to ensure an employee is not
dissatisfied. Motivation factors are needed to motivate an employee to
higher performance. Herzberg also further classified our actions and
how and why we do them, for example, if you perform a work related
action because you have to then that is classed as movement, but if
you perform a work related action because you want to then that is
classed as motivation.
Unlike Maslow, who offered little data to support his ideas, Herzberg
and others have presented considerable empirical evidence to confirm
the motivation-hygiene theory, although their work has been criticized
on methodological grounds.
7
2. As a salesman, it is important to know the specific
information or should have knowledge about the company.
Before your exposure to direct selling, you were required by
your manager to present in the committee the specific
information of such company you are connected with.
a. History of the company
b. Executive personnel
c. Personnel and labor relations
d. Plants and branches
e. Organization
f. Distribution methods
8
g. Research and Investigations
h. Competitive information
9
A. History of the company
Universal Robina Corporation (URC) traces its beginnings all the way
back to 1954. John Gokongwei was doing very well then as a
trader/importer. He had learned the trade when his father died before
the war, and had worked hard through the war and postwar years to
prosper. However, while he thrived, he took a long hard look at his
company, and correctly predicted that trading would remain a low-
margin business.
On the other hand, a successful manufacturer controlling its own
production and distribution would command more profitable margins.
Mr. John decided to construct a corn milling plant to produce glucose
and cornstarch, Universal Corn Products (UCP), the first linchpin of
the company that would become the URC we know today.
10
For a time, business was good. However, Mr. John was still looking
ahead, working with an eye towards the future. While the business was
doing very well, it was producing essentially a commodity, which a
customer could easily access elsewhere. To stay ahead in the game,
Mr. John had to diversify by producing and marketing his own branded
consumer foods, similar to the multinational companies in the country
like Nestle and Procter & Gamble. In a sense, he wanted to put up the
first ‘local’ MNC, borne out of their best practices.
Thus, in 1961, Consolidated Food Corporation was born. Their first
‘home run’ product was Blend 45, the first locally manufactured coffee
blend, dubbed as the “Pinoy coffee”. This became the largest-selling
coffee brand in the market, even beating market leaders Café Puro and
Nescafe.
After coffee came chocolates. Nips, a panned chocolate were a staple
of Filipino childhood.
In 1963, Robina Farms started operations, beginning with poultry
products. This was also the beginning of the vertical integration of the
Gokongwei businesses, as the farms would be able to purchase feeds
from UCP in the future. Later that decade, Robichem Laboratories
would be put up, to cater to the veterinary needs of the farms
businesses. Robina Farms expanded as it entered the hogs business in
the latter part of the 70s.
1966 saw the establishment of Universal Robina Corporation, which
pioneered the salty snacks industry through Chiz Curls, Chippy, and
Potato Chips, under the “Jack ‘n Jill” brand. Other snack products
would follow over the years, as the company successfully introduced
market leaders like Pretzels, Piattos, and Maxx.
11
The coming decades saw more acquisitions and expansion. In the early
1970s, the family entered the commodities business through the
formation of Continental Milling Corporation, for flour milling and
production. The late 1980s brought the acquisition of three sugar mills
and refineries, under URC Sugar. These two businesses provided
stable cash flows, and allowed for further vertical integration in the
supply chain, to help URC weather any volatility in the cyclical
commodities markets. In line with this strategy, the late 1990s saw the
entry of URC into the plastics business, through URC Packaging.
While the businesses became more diversified, the companies were
slowly integrated in order to streamline and minimize costs. In 2005,
the present structure of the group was completed. All the different
companies are now organized under the Universal Robina Corporation
umbrella, divided into 3 focused groups:
the Branded Consumer Food Group, comprised of BCFG Domestic
(including packaging) and International
the Agro-Industrial group, comprised of Universal Corn Products,
Robina Farms, and Robichem
and the Commodities group, with the Sugar and Flour divisions
12
B. Executive Personnel
Key Executives - Universal Robina Corp (URC)Name Title Age
James L. Go Chairman, Chief Executive Officer, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
72
Lance Y. Gokongwei
President, Chief Operating Officer, Director, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
45
13
Name Title Age
John L. Gokongwei Jr.
Founder, Chairman Emeritus, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
85
Geraldo N. Florencio
First Vice President and Controller 59
Cornelio S. Mapa Jr.
Executive Vice President 45
Board Members
Insiders At Universal Robina Corp (URC)Name (Connections)
Title Age
James Go Chairman, Chief Executive Officer, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
72
Lance Gokongwei
President, Chief Operating Officer, Director, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
45
14
Name (Connections)
Title Age
John Gokongwei Jr.
Founder, Chairman Emeritus, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
85
Patrick Go Vice President, General Manager of URC Packaging Division & CFC Flexible Packaging Division and Director
41
Audit Committee* - Universal Robina Corp (URC)Name (Connections)
TitleKey Developments
James Go Chairman, Chief Executive Officer, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
15
Name (Connections)
TitleKey Developments
Lance Gokongwei
President, Chief Operating Officer, Director, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
John Gokongwei Jr.
Founder, Chairman Emeritus, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
Wilfrido Sanchez
Independent Director, Chairman of Audit Committee and Member of Nomination Committee
Johnson Go Jr. Director, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
Pascual Guerzon
Independent Director, Member of Audit Committee and Member of Remuneration & Compensation Committee
Compensation Committee* - Universal Robina Corp (URC)Name (Connections)
Board Relationships
Title
James Go 54 Relationships
Chairman, Chief Executive Officer, Member of Audit Committee, Member of
16
Name (Connections)
Board Relationships
Title
Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
Johnson Go Jr. 29 Relationships
Director, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
John Gokongwei Jr.
42 Relationships
Founder, Chairman Emeritus, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
Lance Gokongwei
46 Relationships
President, Chief Operating Officer, Director, Member of Audit Committee, Member of Nomination Committee, Member of Executive Committee and Member of Remuneration & Compensation Committee
Pascual Guerzon
9 Relationships Independent Director, Member of Audit Committee and Member of Remuneration & Compensation Committee
C. Personnel and Labor Relations
Out of the total employees, 2,026 are managerial and administrative
staff. As at the same date, approximately 13,000 contractual and
17
agency employees are engaged in the Company’s businesses.
The Company does not anticipate any substantial increase in the
number of its employees in fiscal
2012.
For most of the companies and operating divisions, collective
bargaining agreements between the relevant representatives of the
employees’ union and the subsidiary or divisions are in effect. The
collective bargaining agreements generally cover a five-year term with
a right to renegotiate the economic provisions of the agreement after
three years, and contain provisions for annual salary increases, health
and insurance benefits, and closed-shop arrangements. The collective
bargaining agreements are with 22 different unions. For fiscal 2011, 6
collective bargaining agreements were signed and concluded with the
labor unions which are as follows: Meat and Canning Division Monthly
Independent Union (MCD-MIU), Meat and Canning Division New
Employees and Workers United Labor Organization (MCD-NEW-ULO),
and Universal Corn Products Technical and Office Staff
Employees Association-Association of Genuine Labor Organizations
(UCP-TOSEA-AGLO), Kilusan Sa Pakikibaka sa Universal Robina Corp.
(KSP-URC), Cebu Industrial Management Corporation Employees Union-
Worker’s Solidarity Network (CIMCEU-WSN) and Terai Workers Union -
Organized Labor Association in Line Industries and Agriculture (TWU-
OLALIA).
The Company believes that good labor relations generally exist
throughout the Company’s subsidiaries and operating divisions.
The Company has established non-contributory retirement plan
covering all of the regular employees of URC. The plan provides
retirement, separation, disability and death benefits to its members.
18
The Company, however, reserves the right to change the rate and
amounts of its contribution at anytime on account of business
necessity or adverse economic conditions. The funds of the plan are
administered and managed by the trustees. Retirement cost charged
to operations, including amortization of past service cost, amounted to
P94 million, =63 million and P103 million in fiscals 2011, 2010 and
2009 respectively.
D. Plants and Branches
Universal Robina Corp. - Offices/Branches
Universal Robina Corp.Address: SilanganCanlubang Industrial Park, , Calamba City, Laguna, Philippines Telephone No: (6349) 549-0012/7418/7453/2195
19
Universal Robina Corp.Address: , , El Salvador, Misamis Oriental, Philippines Telephone No: (6388) 755-296
Universal Robina Corp.Address: 43F Robinsons Equitable Tower, ADB Ave. Cor. Poveda Rd, Pasig City, Metro Manila, Philippines Telephone No: (632) 633-7631 Fax No: (632) 6354135
Universal Robina Corp.Address: , 16 Santiago St., Pasig City, Metro Manila, Philippines Telephone No: (632) 671-8195 Fax No: (632) 671-3986
Universal Robina Corp.Address: 2F Brittania Bldg., 110 E. Rodriguez Jr. Ave., Pasig City, Metro Manila, Philippines Telephone No: (632) 671-2935 loc. 169, 671 8958 Fax No: (632) 671-8953
Universal Robina Corp.Address: , , San Fernando City, Pampanga, Philippines
Universal Robina Corp.Address: , ML Quezon Ave., Antipolo City, Rizal, Telephone No: (632) 639-1040
Universal Robina Corp.Address: , National Rd., Batangas City, Batangas, Telephone No: (6343) 300-7297 to 99, 520-6170
20
Universal Robina Corp.Address: , National Highway, Calamba City, Laguna, Telephone No: (6349) 834-2830
URC Packaging Division
URC Packaging Division produces and sells a wide range of Bi-axially
Oriented Polypropylene (BOPP) films, primarily used for packaging of
various consumer products.
The BOPP plant, located in Simlong, Batangas, is equipped with
Bruckner technology and has a rated capacity of 33,000 metric tons
per annum.
This business unit holds the distinction of being the only Integrated
Management System ISO certified BOPP plant in the country today with
its Quality ISO 9001:2000 and Environmental ISO 14001:2004
Standards.
Commodity Foods Group
URC’s Commodity Foods Group is engaged in flour and sugar milling
and distribution, and sells its products to commercial and institutional
accounts.
URC Flour Division
21
URC Flour produces and sells Hard and Soft Wheat Flour to both
commercial and institutional accounts. The division also supplies the
local and export flour requirements of the URC Branded Consumer
Food Group and URC International respectively. Other product offerings
are flour-milling by-products such as wheat germ, bran and pollard.
The company also manufactures and sells spaghetti and macaroni
products under the brand name EL REAL and toll manufactures for
other food companies.
URC Flour has a total flour milling capacity of 1,550 metric tons per
day.
URC Sugar Division
URC Sugar operates 4 sugar mills and 3 refineries in Luzon and
Visayas, and is among the largest sugar millers/refiners in the country.
URSUMCO (Negros Oriental), SONEDCO (Negros Occidental), and
CARSUMCO (Cagayan Valley) provide sugar cane milling and refining
services, trades raw sugar and sells refined sugar and molasses. PASSI
(Iloilo) provides sugar cane milling services and trades raw sugar and
molasses.
URC Sugar has a total sugar milling capacity of approximately 29,000
tons of cane per day. It also has a sugar refining capacity of
approximately 32,000 50-kg bags of sugar per day.
Commodity Foods Group
URC’s Commodity Foods Group is engaged in flour and sugar milling
and distribution, and sells its products to commercial and institutional
accounts.
22
URC Flour Division
URC Flour produces and sells Hard and Soft Wheat Flour to both
commercial and institutional accounts. The division also supplies the
local and export flour requirements of the URC Branded Consumer
Food Group and URC International respectively. Other product offerings
are flour-milling by-products such as wheat germ, bran and pollard.
The company also manufactures and sells spaghetti and macaroni
products under the brand name EL REAL and toll manufactures for
other food companies.
URC Flour has a total flour milling capacity of 1,550 metric tons per
day.
URC Sugar Division
URC Sugar operates 4 sugar mills and 3 refineries in Luzon and
Visayas, and is among the largest sugar millers/refiners in the country.
URSUMCO (Negros Oriental), SONEDCO (Negros Occidental), and
CARSUMCO (Cagayan Valley) provide sugar cane milling and refining
services, trades raw sugar and sells refined sugar and molasses. PASSI
(Iloilo) provides sugar cane milling services and trades raw sugar and
molasses.
URC Sugar has a total sugar milling capacity of approximately 29,000
tons of cane per day. It also has a sugar refining capacity of
approximately 32,000 50-kg bags of sugar per day.
Universal Corn Products
23
Universal Corn Products (UCP) is one of the leaders in the Philippine
animal feed industry with combined milling capacities of 1,200MT per
day from its plants in Manila and Cebu.
Its line of nutritionally balanced and cost effective hogs, poultry, fish
and game fowl feeds, marketed under the brand name Robina
Starfeeds, is formulated by a top-caliber nutrition team and have
gained wide acceptance among animal raisers in the country. They
come in pellet, crumbled and mash form.
UCP likewise, produces and sells liquid glucose and quality soya
products, which are used in the production of confectionery products
and animal feeds, respectively.
Robichem
Robichem manufactures, distributes and sells a wide range of high-
quality and well-known animal health products such as vaccines, water
solubles, injectables, feeds supplements and disinfectants, which are
both marketed commercially and used by Robina Farms because of its
proven effectiveness and cost-efficiency.
Robichem is the exclusive distributor of multinational companies
namely, Janssen Animal Health and Malaysian Vaccines
Pharmaceuticals.
Robina Farms-Hogs
Robina Farms (RF) Hogs breeds and sells prime finisher hogs, piglets
and breeder stocks such as its own Grandeur Boar and Grand Dame
gilt.
RF- hog production facilities, located in Rizal, Novaliches, Bulacan and
Batangas maintain 15,500 sows at any given time; and are reputed to
be one of the most modern swine facilities in the country.
24
Robina Farms-Poultry
RF also produces superior day-old broiler and layer chicks from the
world-class breeds such as Hubbard, Shaver and Hyline.
RF poultry production facilities are located in Cebu, Rizal and Bulacan,
with a total farm capacity of 500,000 breeders.
RF is a formidable player in both the Layer and Broiler industries; and
is the number one day-old chick supplier in the country.
Branded Consumer Foods Group - International
Looking ahead to “a world without borders,” URC has expanded
steadily outside the country. At present, URC maintains manufacturing
facilities in China, Thailand, Malaysia, Vietnam and Indonesia and has a
strong foothold in the countries it presently operates in. URC products,
under the “Jack ’n Jill” megabrand, are widely available in most trade
channels in Thailand, Malaysia, Singapore, Indonesia, Vietnam, China,
and Hong Kong.
The most established international operations of URC are in Thailand,
Indonesia and Malaysia. Leading market share positions are attained in
these countries in several niche product categories.
“ACES,” a brand bought by URC from Acesfood Network Pte Ltd in
2005, continues to be a leader in the instant cereal beverage and
oatmeal markets in China. The purchase of the brand is a strategic
move for URC as it allows improved distribution in key geographic
markets and provides a strong, well-regarded brand that will be a
platform for future growth in China.
In April 2006, URC started manufacturing and selling C2 Green Tea in
Vietnam, making URC Vietnam the first subsidiary outside the
Philippines to manufacture and market C2. C2 is now one of the two
25
market leaders in Vietnam and manufacturing is being expanded to
meet strong market demands. In August 2007, URC Vietnam started
manufacturing biscuits in order to strengthen its foothold in the fast
growing snackfoods market in Vietnam.
Thailand
URC Thailand, URC International’s largest subsidiary, is a major
snackfoods player in that country, manufacturing Snacks, Biscuits,
Wafers, Candies, and Chocolates under the following brands:
Snacks: Roller Coaster, Fun Bite
Biscuits: Cream-O, Fun-O, Magic, Dewberry
Wafers: Tivoli, Lausanne
Candies: X.O., Dynamite, Lush, X-cite,
Chocolates: Nips, Wiggles
Malaysia and Singapore
In Malaysia, URC produces Snacks, Wafers, and Chocolates. These
products are also carried by URC’s sales office in Singapore.
Snacks: Potato Chips, Roller Coaster, Jigs, Fun Bite
Biscuits: Cream-O, Magic, Dewberry
Wafers: Cloud 9
Candies: Dynamite, Cloud 9 Candies
Chocolates: Nips, Cloud 9, Chooey Choco
Indonesia
26
URC has factories in the most populous country in Southeast Asia,
manufacturing Snacks, Candies, and Chocolates under the following
brands:
Snacks: Roller Coaster, Piattos, Sea Crunch, Peppitas, Guritoz, Chippy
Wafers: Cloud 9 Wafrets
Candies: Dynamite, Alus, Lush
Chocolates: Chooey Choco, Cloud 9
China and Hong Kong
URC has factories in China that cater to both China and HK markets.
These products are marketed under the following brands:
Snacks: Roller Coaster, Potato Chips, Beef Crunchies, Spuds
Candies: X.O., Dynamite
Beverages (China only): ACES Instant Cereal, ACES Oates, ACES
Coffee, ACES Health drink, ACES Soya
Chocolates (HK only): Nips, Cloud 9
Biscuits (HK only): Cream-O, Magic, Dewberry
Vietnam
URC Vietnam, which started operations in 2004, is the newest addition
to URC International. Vietnam manufactures Biscuits, Snacks and
Candies, and is the very first URC subsidiary outside the Philippines to
manufacture and successfully market C2 Green Tea.
Snacks: Fun Bite, Potato Chips
Biscuits: Cream-O, Magic
27
Candies: Dynamite, Lush, Xcite
Beverages: C2
Branded Consumer Foods Group - Domestic
Universal Robina Corporation (URC) is the leading branded
convenience food and beverage company in the Philippines. Touted as
the country’s first “Philippine multinational” as it has the widest
geographical footprint among local food manufacturers, URC has
blazed the trail for the branded foods industry. The company has
shaped the competitive landscape of local consumer brands through
its innovative products, wide distribution, and high-impact marketing.
URC is best known for manufacturing and distributing high-performing
products such as Chippy, Nova and other snack foods under the Jack ‘n
Jill mega brand, Nissin and Payless instant noodles, as well as Hunt’s
tomato-based products.
URC is also a trendsetter in the beverage industry with its coffee and
ready-to-drink products. It grew the local non-carbonated beverage
market with the successful launch and continuing promotion of C2 Cool
& Clean Green Tea. Building on the global trend towards health and
wellness, C2 spearheaded the expansion of a new and high-growth
segment in the Philippine beverage industry: the green tea segment.
URC built on that success with forays into other areas of the non-
carbonated beverage market, such as juices, energy drinks, and ready-
to-drink coffee, among others.
Snack foods
Beverage
Grocery
Others
Snackfoods
28
With a long heritage that began in the 1960s, URC’s snack foods
brands are well-loved by generations of Filipinos. Many have grown up
with the comforting crunch of “Chippy” and “Chiz Curls”, and today’s
young adults have fond memories of eating along to the well-loved
“Nips” jingle of days passed. From heritage brands such as these, to
newer products such as Magic, Nova, and Dewberry, URC has
developed the largest and most diverse portfolio of snackfood products
in the Philippines to fill everyone’s snacking needs. And now, the
products you grew up with and continue to snack on are all under the
“Jack ‘n Jill” megabrand, a name synonymous with consistent quality,
great value, and fun.
Savory Snacks
URC is the market leader in savory snacks, and has welcomed Granny
Goose snacks into its fold.
Corn Chips: Chippy, Mr. Chips, Taquitos, Tostillas
Natural Potato:Potato Chips, V-Cut
Fabricated Potato: Piattos, Roller Coaster
Extruded / Pelletized: Chiz Curls
Multi-Grain: Nova
Mixed Snacks: Pic-A
Granny Goose: Tortillos, Kornets
Biscuits
URC is one of the leading biscuit producers in the country.
Cookies: Presto, Cream-O, Dewberry
Crackers: Magic Flakes, Magic Creams, Magic Flavors
29
Wafers: Hello! Coated, Hello! Pipers, Hello! Glazed, Wafrets Sticks
Pretzels: Choco Pretzels, Knots
Cakes
URC is an innovative player in the cakes category.
Quake Bars
Quake Overload
Candies
URC is the market leader in candies.
Hard Boiled: Maxx, Dynamite
Deposited: X.O.
Gummies / Jellies: Jojo Gummies
Lollipops: Star Pops
Marshmallows: Wiggles
Soft: Lush
Chocolates
URC is the market leader in chocolates.
Enrobed: Cloud 9, Big Bang, Chooey, Monster Munch
Panned: Nips
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E.Organization
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Universal Robina Corporation has three main business lines:
The Branded Consumer Foods Group is the largest business and
the key driver of growth and profitability. It is composed of the
Philippine, international and packaging businesses. In the
Philippine BCFG, our main divisions are Snack Foods, Beverages,
Grocery (which include the joint ventures Nissin-URC and Hunts
URC), Exports, and Packaging. Our international investments are
in Thailand, Indonesia, Malaysia/Singapore, China/HK, and
Vietnam.
The Agro-Industrial Group is composed of hog and poultry farms,
branded feeds, and animal health products.
The Commodity Foods Group has both flour and sugar.
The latter two groups provide URC with consistent cashflows and, in
the case of commodities, consistent supply of raw materials for the
Branded Consumer Foods Group.
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F. Distribution methods
The Company has developed an effective nationwide distribution chain
and sales network that it believes provide its competitive advantage.
The Company sells its branded food products primarily to
supermarkets, as well as directly to top wholesalers, large convenience
stores, large scale trading companies and regional distributors, which
in turn sell its products to other small retailers and down line markets.
The Company’s branded consumer food products are distributed to
approximately
150,000 outlets in the Philippines and sold through its direct sales
force and regional distributors.
URC intends to enlarge its distribution network coverage in the
Philippines by increasing the number
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of retail outlets that its sales force and distributors directly service.
The Company generally sells the branded consumer food products
from salesmen to wholesalers or supermarkets, and regional
distributors to small retail outlets. 15 to 30 day credit terms are
extended to wholesalers, supermarkets and regional distributors.
The Company believes that its emphasis on marketing, product
innovation and quality, and strong brand equity has played a key role
in its success in achieving leading market shares in the different
categories where it competes. In particular, URC launched “Jack ‘n Jill”
as a master umbrella brand in order to enhance customer recognition
of its products. URC devotes significant expenditures to support
advertising and branding to differentiate its products and further
expand market share both in the Philippines and in its overseas
markets, including funding for advertising campaigns such as
television commercials and radio and print advertisements, as well as
promotions for new product launches by spending on average 5% of its
branded consumer food division’s net sales this year.
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G. Research and Investigations
The Company develops new products and variants of existing product
lines, researches new processes and tests new equipment on a regular
basis in order to maintain and improve the quality of the Company’s
food products. In Philippine operations alone, about P28 million was
spent for research= and development activities for fiscal 2011 and
approximately P40 million and P42 million for fiscals 2010 and 2009,
respectively.
The Company has research and development staff for its branded
consumer foods and packaging divisions of approximately 83 people
located in its research and development facility in Metro Manila.
The Company also has research and development staff in each of its
manufacturing facilities. In addition, the Company hires experts from
all over the world to assist its research and development staff. The
Company conducts extensive research and development for new
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products, line extensions for existing products and for improved
production, quality control and packaging as well as customizing
products to meet the local needs and tastes in the international
markets. The Company’s commodity foods division also utilizes this
research and development facility to improve their production and
quality control. The Company also strives to capitalize on its existing
joint ventures to effect technology transfers.
The Company has dedicated research and development staff for its
agro-industrial business of approximately 41 persons. Its researchers
are continually exploring advancements in breeding and farming
technology. The Company regularly conducts market research and
farm-test for all of its products.
The Company also has a diagnostic laboratory that enables it to
perform its own serology tests and offers its laboratory services
directly to other commercial farms and some of its customers as a
service at a minimal cost.
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H. Competitive information
The URC business is highly competitive and competition varies by
country and product category. The
Company believes that the principal competitive factors include price,
taste, quality, convenience, brand recognition and awareness,
advertising and marketing, availability of products and ability to get its
product widely distributed. Generally, the Company faces competition
from both local and multinational companies in all of its markets. In the
Philippines, major competitors in the market segments in which it
competes include Liwayway Manufacturing Corp., Columbia Foods
International, Republic Biscuit Corporation, Suncrest Foods Inc., Del
Monte Phil. Inc., Monde Nissin Corporation, Nestle Philippines Inc., San
Miguel Pure Foods Company Inc. and Kraft Foods Inc. Internationally,
major competitors include Procter & Gamble, Effem Foods/Mars Inc.,
Lotte Group,
Perfetti Van Melle Group, Mayora Inda PT, Calbee Group, Apollo Food,
Frito-Lay, Nestlé S.A., Cadbury Schweppes plc, Groupe Danone S.A.
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and Kraft Foods International.
Competition in the Philippine food and beverage industry is expected
to increase in the future with increased liberalization of trade by the
Philippine government and the predicted accompanying growth in
imports due to the World Trade Organization (WTO) and ASEAN Free
Trade Area (AFTA). Under the WTO, tariff rates on food and agricultural
items are being decreased and import quotas are being eliminated
among member countries, including the Philippines. AFTA is a free
trade area formed by 10 South East Asian countries, including the
Philippines. Under the AFTA, tariffs on manufactured goods, including
processed agricultural products, are being minimized or eliminated
over a 15-year period starting from January 1, 1993, and non-tariff
barriers will be subsequently phased out.
The day-old chicks market is cyclical, very competitive and principally
domestic. The Company believes that the principal competitive factors
are chick quality, supply dependability, price and breeder performance
for broiler chicks. For layer chicks, competitive factors are egg
productivity and disease resistance. The Company’s principal
competitors are Danway Processing Corp, RFM Corp. and Math Agro for
broiler chicks and Bounty Farms, Inc., Brookdale Farms, and Heritage
Vet Corp. for layer chicks.
The live hog market is highly fragmented, competitive and principally
domestic. The Company believes that the principal competitive factors
are quality, reliability of supply, price and proximity to market. The
Company’s principal competitors are San Miguel Corp. (Monterey) and
Foremost Farms,
Inc. The main competition is from backyard raisers who supply 62-65%
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of the total pork requirement in the country. In 2011, the hog
population decreased by 6% because of disease outbreaks and farm
closure(s) due to high cost of inputs (Feeds) and lower live weight
prices (due to lower consumer spending). It is expected that live
weight prices will relatively be higher in the 1st half of 2011 that will
encourage raisers, both backyard and commercial farms to start and
expand their operations with the anticipated improvement in
profitability.
The commercial animal feed market is highly fragmented and its
products compete primarily with domestic feed producers. As of
September 30, 2011, there were 150 registered feed mills in the
Philippines, 25% of which sell commercial feeds. URC believes the
principal competitive factors are quality, brand equity, credit term and
price. The Company’s principal competitors are B-Meg and UNAHCO
(Sarimanok & Thunderbird). A number of multinationals including
Cargil Purina Phils.
Inc, CJ and Sun Jun of Korea, and New Hope of China are also key
players in the market.
The animal health products market is highly competitive. The market is
dominated by multinationals and the Company is one of only few
Philippine companies in this market. The Company’s principal
competitors are Pfizer, Inc., UNAHCO (Univet)., and Merial Limited, a
company jointly owned by
Merk and Co., Inc. and Aventis. S.A. The principal competitive factors
are brand equity, price, product effectiveness, and credit terms.
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