Christopher Robin S.

Ortaleza
Management Action Research – BUS530M
MBA
Assignment 5 (3rd Revision)

Robinsons Retail Holdings, Inc.

RRHI is one of the largest multi-format retailers in the Philippines. Major formats: supermarket,
department store, drugstore, convenience store, appliances, toys, one price concept store, international
fashion brand and coffee shop.

 Robinsons Supermarket  Robinsons Department Store

From the company’s beginnings with the first opening of Robinsons Department Store in 1980 at
Robinsons place Manila, it gained presence and have established consumer trust in major cities and
communities across the country. In 2017, the company reached a store network of over 1,700 stores
alongside more than 2,000 franchised branches of the Generics Pharmacy, which they acquired last 2016.
To fulfill their part in nation-building, they strive to foster meaningful relationship with various business
partners and create career opportunities for their diverse workplace. As the company expand, they usher
in growth of modern retail previously untapped markets. They engage both global and local suppliers to
deliver safe and high quality merchandise to their customers, while implementing a holistic business
development strategy geared towards corporate sustainability amidst a dynamic economic land scape.

The establish strong ties with leading mall developers in the country serve as anchor tenants for
Robinsons Malls which operates 47 malls in the country as of end 2017. The company constantly aim to
incorporate new and innovative technologies into the operations. They also strengthened their presence
in the e-commerce space with Lazada, Zalora and Shopee. They also established cashless and mobile
payment platforms through collaborations with Smart as they introduced GCash and PayMaya in number
of stores.

Daiso Japan - Company

Daiso Japan is one of the retail formats operated by Robinsons Retail Holdings Inc. They fall under
the category of a “specialty store”. It is defined as a retail business that focus on specific products
categories, such as office supplies, men’s or women’s clothing. The iconic global brand is owned by Daiso
Industries Co. Ltd., of Japan since 1977. The company was founded by Mr. Hirotake Yano who first
introduced in 1972 the “Yano Shoten” concept, a street vending shop dealing with 100 yen products. With
headquarters in Hiroshima Prefecture, Japan, the company grew exponentially over the years. In Japan
alone, Daiso has over 2,400 stores and a strong presence in at least 30 countries

The company offers a wide range of unique products - from home and kitchen ornaments, office
knick-knacks, and beauty essentials to curious merchandise that are both practical and collectible. It
makes sure that the items in store are grounded by three pillars, mainly, variety, quality and uniqueness
and strives to offer these at affordable prices starting at Php88.

Daiso Japan Philippines is currently 90 stores nationwide. Majority are located at Robinsons Malls,
Ayala Malls and other leading malls in the country. The main goal of Daiso Japan is to be the leading one
price retail concept in the country. One of the strategy is to expand store network in the Philippines.
Daiso Japan – Business Development

Business development for Robinsons Retail Group key function is to expand business units’
physical store and tap all potential markets. Business development must identify and map business
strengths and develop growth strategies and plans. They also need to understand target market that
includes industry, developers and latest industry developments. Daiso Japan business development
currently have 3 personnel. 1 manager, 1 officer and 1 assistant. The manager basically oversees overall
feasibility, negotiations and transactions of business development. The officer assists the manager in
terms of ocular visit and negotiations while assistant is more on documentation and admin works.

Daiso Japan Business Development Organizational Chart

BU GENERAL MANAGER

Business Development Manager

Business Development Officer

Business Development Assistant

The key function of Business Development is quiet challenging because it requires a lot of
coordination and negotiations. With the emergence of different retail formats that wants to get a space
in the best possible locations. Please see list of Business Development issues:
Array of Issues
1. Strong competition of retail formats that wanted to get a space inside malls.
As per Philippine Retailers Association’s (PRA), the Philippine retail industry grew by 5.8% in the fourth
quarter of 2018. With the continuous growth in the retail industry, many businesses still prioritize
physical stores despite the emergence of e-commerce. Tenants wanted to get the most feasible
spaces inside the malls to capture all potential traffic. This demand makes hard for us to choose and
negotiate. Majority of the offers are simultaneously being offered to other prospective tenants.
2. Slow process of securing a space (internal)
The evaluation and approval process of Daiso japan for new potential stores is quiet long and slow.
Process flow:
Initial Offer – BD
 The lessors usually send first initial offer to Daiso Japan. The lease offer indicates the area size,
location, rental rate and other important information regarding the proposed space.
Initial Visit – BD, OPS, SPD, GM
 The team will visit the proposed area to further evaluate the location.
a. Evaluation – BD, OPS, GM
 After we review the offer and visit the area, we now can evaluate if it would be feasible
for us in putting up a store.
b. Negotiation – BD
 After reviewing, we will negotiate to get the best possible rates based on our
evaluation.
c. Final Offer – BD
 After the final negotiation, we are now expecting to get the final offer wherein we are
hoping to get our desired rates.
d. Technical Meeting – BD, SPD
 In this stage, store planning department will meet the mall’s technical team to discuss
possible punch list in the space, design guideline and pre-construction.
e. EXCOM / Signing – BD, OPS
 The final offer with CAPEX will now be presented to EXCOM for the final approval. once
approved, we can now endorse the offer for signature.
f. Design / Drawing – SPD
 In this stage, store planning department will now finalize design and drawings of the
store which will now be submitted to the technical team of the lessor for final approval.
g. Construction – SPD
 Construction of the actual store plus deliveries of fixtures and equipment’s.
h. Pre-opening activities – OPS
 This stage wherein operations team check all necessary documents needed prior to
opening like operational permits.
i. Opening – OPS
 3. Negotiation of rates, terms and conditions.
We at Daiso Japan always wanted to get the best feasible rate we can get to the lessor for us to
maximize our profit and minimize operational expenses. Negotiation is always a challenge for
lessee because as much as possible lessors always wanted to offer high rates. Our negotiation is
usually in forms of formal letter, email and personal meeting.
4. Delayed feedback from lessors
Communication is key factor in closing a deal with lessors. Another challenge is the delayed
feedback from lessors once we coordinate some request and concerns. A good example is the
delayed feedback when we are negotiating rates, another is when we are requesting to rectify
punch list in the offered area. This delays causes a domino effect and can affect timeline.
5. Lessors have their own same concept retail format
The lessors who are most likely the mall developers have their own same concept retail like Daiso
Japan. This will prevent us in entering the mall due to conflict of interest and malls are protecting
the competition internally. With this development, our expansion might be limited to the other
remaining developers.

Focal Issue
The main focal issue of this action research is to improve the process in securing a proposed area for Daiso
Japan. This process when improve will be a good competitive advantage for the company against their
competitors. Given the strong competition and uprising market of specialty stores in the country.
Expansion of physical stores and getting the most feasible spaces will be a rat race. As per actual
experienced, the fastest tenant to close the deal will secure the space. Lessor’s usually prioritize brands
that will fit in with their tenant mix. But they also wanted to lease out spaces as soon as they can.

Review of Literature

As per the study of “Business process maturity models: A systematic literature review” by Tarhan,
Turetken and Reijers last 2015. In the past decade, there were number of maturity models proposed in
the area of Business Process Management (BPM). However, there were challenges such as the limited
practical studies on their validation and a limited extent of properties to guide the application. This
research studies between the year 1990 and 2014 in established digital libraries to identify empirical
studies of business process maturity models. The result shows that, the level of empirical evidence reveals
the validity and usefulness of those models is unusual.
The study of “Examining the impacts of organizational culture and top management support knowledge
sharing on the success of software process improvement” by Lee, Shiue and Chen last 2015 focuses on
the following:
 Software process improvement relies on human behavior of knowledge sharing, culture
and top management support.
 Determines how these factors influence software process improvement; specifically, it
shows that.
 Clan-type culture is significant to knowledge sharing on SPI context.
 How top management support may place influence on the path to software process
improvement success.

Conceptual Framework

References:

https://businessmirror.com.ph/2019/07/29/philippine-retail-industry-posts-positive-outlook-for-2019/

https://www.euromonitor.com/retailing-in-the-philippines/report

https://implementationscience.biomedcentral.com/articles/10.1186/s13012-015-0323-0?report=reader

https://libjournals.mtsu.edu/index.php/jsbs/article/view/1153

https://www.sciencedirect.com/science/article/abs/pii/S0950584916300015

https://www.sciencedirect.com/science/article/abs/pii/S0950584916300015

https://www.sciencedirect.com/science/article/pii/S0747563215301060