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Colegio de San Juan de Letran Graduate School Program 151 Muralla St, Intramuros, Manila, 1002 Metro Manila BUSRE/ Business Research AY 2022– Duration of the Project: Nov 2022- March 2023 Date Submitted: March 25, 2023 Signature of the Proponent:
Research Proposal
Proponent: BULAN^ WILFREDO JR^ PRANE Last Name First Name Middle Name Degree Degree Master of Business Administration Specialization NA Project Title Emerging Trends And Challenges In Baking Industry In Quezon City New or Continuing New ✓ Continuation (Note: maybe part or related to a bigger program) Collaborators/Co- Authors (State Affiliation) N/A Rationale of the Research Project The bakery industry in the Philippines has been facing unprecedented challenges since 2020. The APP estimates that 20 percent of community bakeries have already closed shops, and if there is no government intervention, the rate of closure could increase up to 50 percent (Manila Bulletin, 2022). The COVID- pandemic and the ongoing conflict in Ukraine have led to disruptions in supply chains and consumer behavior, significantly impacting the bakery industry's success. Previous studies have identified factors that contribute to a bakery's success. However, they did not consider the impact of these emerging challenges. Furthermore, previous studies only focused on the perspective of the bakery owners and did not take into account the viewpoint of the consumers. Nevertheless, consumers play a crucial role in the bakery business as they are the ones who drive repeat purchases, loyalty, and positive word-of-mouth. Therefore, it is essential to conduct a new study that considers the impact of these emerging challenges and the consumers' perspective. This study aims to examine 1
how these factors affect customer satisfaction in the bakery industry in the Philippines and how businesses can address these challenges to ensure their success. The findings of this study can help bakery owners and stakeholders make informed decisions and take appropriate measures to increase their chances of success in the face of these challenges. Statement of the Problem (Objectives) This study aims to provide a critical analysis of the challenges and emerging trends in the bakery business in Quezon City, including an examination of bakery owners' strategies and the rationale behind them, as well as an assessment of their ability to satisfy their customers. The research aims to understand the underlying factors and their interrelationships, as well as how they affect sales and what adjustments or strategies can be made. Theoretical aspects will also be clarified by analyzing the cause-and-effect relationships of external factors in the bakery business and the business's ability to adjust to these factors, and how these relationships affect customer satisfaction. Review of Related Literature, including earlier work of the proponent related to the proposed project. To understand emerging trends and challenges in the baking industry, it is important to evaluate the nature of the business by examining the factors that affect it. Francis Aguilar's PESTLE analysis is a commonly used tool by marketers to assess external factors that can create opportunities or threats to a business organization (F. Aguilar, 1967). The bakery business is an example of a business that is heavily influenced by external factors, which can significantly impact customer satisfaction. For a bakery business, the quality of bread is the primary factor influencing customer satisfaction. Consumers consider freshness, taste, size, and appearance to be the most important factors when evaluating bakery products (M. Camarilloa, A. Piñab, S. Ocañac, J. Anamd, 2021). However, customer satisfaction is also influenced by price. A business catering to customers with low price sensitivity has a competitive advantage in both its products and services, which ultimately leads to higher profitability for the organization (Wakefield and Inman, 2003). Impacts of the Ukraine Crises have made Wheat prices increase by 56 and 100 percent in real terms, respectively, between June 2021 and April 2022, with most of the increase occurring since the start of the war (C.Arndt, X. Diao, P. Dorosh, P. Pauw, J.Thurlow, 2023). This could lead to higher bread prices for consumers. The magnitude of the price increase depends on the proportion of wheat in the recipe and the ability of the bakery to absorb the increased cost or pass it on to the 2
Customer satisfaction is a crucial aspect of the baking industry in the Philippines, as it directly impacts the success of the business. The purpose of this study is to delve into these factors that impact bakeries and their ability to satisfy customers, as well as how these factors interact with each other. Conceptual Framework In this conceptual framework, the researcher aims to summarize the research topic and highlight the contribution of the current study. The focus of this study is to examine the impact of various dependent variables on the independent variable, which is bakery customer satisfaction. The study will explore the factors that contribute to bakery consumers' satisfaction, such as the freshness, taste, size, and other aspects of bread, as well as price sensitivity, convenience, and effectiveness of the promotion. Satisfied customers are crucial for the success of any business as they drive repeat purchases, loyalty, and positive word-of-mouth. Therefore, it is important for a bakery business to determine these factors and take appropriate measures to increase customer satisfaction. This study will help bakery business owners make informed decisions and take appropriate measures to improve their operations, enhance customer satisfaction, and increase their chances of success. 4
Theoretical Framework There are numerous theories that discuss customer satisfaction in the context of a bakery business. When a bakery is concerned with gaining profits or avoiding losses, one of the crucial areas to focus on is customer satisfaction. There are several factors that can influence customer satisfaction and subsequently affect purchasing decisions and repeat business. If these factors are not adequately addressed, the bakery's profitability may be at stake. Therefore, it is imperative that the business formulates strategies to increase customer satisfaction. P-E-S-T-E-L model is used to study six major external factors namely political, economic, social, technological, environmental, and legal factors associated with any industry in any particular area or country. It provides us an idea about the overall external environment which might affect production and marketing activities for a particular industry (Aguilar, 1967) Marketing Mix (4ps of Marketing) can be defined as a controllable group of variables that the business can use to affect the buyer’s response to a product or service (Kotler, 2000), CIM (2009). It can be defined as a term used to describe the combination of tactics used by a business to realize its goals by marketing its products or services effectively to a particular target customer group. Price sensitivity refers to a change in a customer's demand as a result of a price reduction or increase. A business that serves customers with low price sensitivity has a more competitive advantage in its services and products and this leads to higher organizational profitability (Wakefield and Inman, 2003). Customer satisfaction is the result of a customer's perception of the value relationship or transaction, where the price is equal to the ratio of the quality of the services provided to the customer's costs. Additionally, feelings play a role in creating satisfaction, besides various cognitive judgments, and are necessary for 5
your bakery's production costs and pricing strategy?
- How has the COVID-19 pandemic impacted your bakery's sales and customer preferences for bread products?
- How have changes in wheat and sugar prices impacted the proportion of alternative grains used in your bakery's bread products?
- How has your bakery responded to changing customer preferences for healthier food options in the wake of the pandemic? Quantitative Methodology questions (For Bakery Owners)
- How frequently do you purchase bread products from bakeries, and what factors influence your decision to do so?
- How important are factors such as taste, freshness, size, appearance, and price when you evaluate the quality of bakery bread products?
- Have you noticed any changes in the taste or quality of bakery bread products in recent years, and if so, what do you attribute these changes to?
- What do you consider to be a reasonable price range for bakery bread products, and how much are you willing to pay for a high-quality product? Expected Output of the Research Project This research project is planned to be submitted to an academic journal dedicated to discussing the challenges and emerging trends concerning bakery businesses. The results of the study can provide useful insights that can guide decision-making and help business owners and aspiring entrepreneurs take appropriate measures to increase their chances of success in the highly competitive bakery industry References
- Aguilar, Francis (2022) Scanning the business environment
- Manila Bulletin (2022) Small neighborhood bakers crying for help article from; Article from Manila Bulletin
- P. Kotler (2000) Marketing Management, (Millennium Edition)
- M. Camarilloa, A. Piñab, S. Ocañac, J. Anamd (2021, December) Analysis on Customer Satisfaction of the Bakeshops: A Case of First Class Municipalities in 7
Cebu Philippines; insight from International Journal of Sciences: Basic and Applied Research
- K. Wakefield, Inman, J. Inman (2003) Situational price sensitivity: the role of consumption occasion, social context and income; insight from Journal of Retailing
- C. Arndt, X. Diao, P. Dorosh, P. Pauw, J.Thurlow (2023) The Ukraine war and rising commodity prices: Implications for developing countries; insight from Science Direct
- Is Social Commerce Still A Worthy Marketing Strategy In 2023? (2023) Article from Truelogic
- Sugar retail price per kilo Philippines CY 2020/21 - CY 2021/22 article from Statista
- J.Tariga, D.Nolasco, S. Barayuga (2021) Food consumption habits of consumers in the Philippines: Changes amidst the pandemic; insight from International Journal of Public Health Science
- CIM (2009) How to achieve an effective marketing mix, 10-minute guide, the charted institute of marketing
- R. Hallowell ( 1996)The relationships of Customer Satisfaction, Customer loyalty, and profitability: an empirical study; insight from International Journal of Service Industry Management
- K. Toften, S. Olsen (2004) The Relationships among Quality, Cost, Value, and use of Export Market Information: An Empirical Study
- S. Kavousi, M. Seyyed, A. Saghayee (2005) Methods of customer satisfaction measurement
- H. Vazifehdoost; A. Rahnama, S. Mousavian (2014) Evaluation of the Impact of Brand Purchase Involvement, Satisfaction, Experience ,and Brand Trust on Loyalty to Brand; insight from Mediterranean Journal of Social Sciences 8
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TIMELINE OF DETAILED RESEARCH ACTIVITIES
SCHEDULE PROJECT WORK ACTIVITIES: GANTT CHART
ACTIVITY OUTPUT DATE GANTT CHART Start Completion Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
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