CHAPTER III

Market Study

Marketing is the process of planning and executing the concept, pricing,

promotion and distribution of ideas, goods and services to create exchanges that satisfy

individual and organizational objective.

This chapter presents the marketing background, market segmentation, target

market, demand and supply analysis, annual demand and supply, sales forecast, market

share, marketing objectives, key players and competitors, and the marketing mix. It also

includes the process and steps in promoting the product in the market.

Marketing Background

This study determines the capability in entering the market. It includes the

suitable strategies and identification of competitors and appropriate strategies that will

be used to promote the product. Ramen is not new in the market for so long but there is

no one in the market of municipality in Alcala Pangasinan at Barangay Laoac. The

researchers became interested in conducting this study on making/producing

Homemade Potato Ramen because of the potential to be grown base on the research

supporting data results.

Market Segmentation
 This segmentation attempts to target those people that age 6 years old to 60 years old

and above. The researchers target market are the people living in the area of barangay Laoac,

Alcala, Pangasinan.

The propose business will be located at barangay Laoac, Alcala, Pangasinan. The

researchers chose the barangay Laoac, where the product will be offered and distributed

because barangay Laoac, location is good for business since there is no business that offers the

same product which is homemade potato ramen.

Target Market

It is important to identify the business target market. Target market is a set of

present and potential customers that an organization attempts to satisfy. The target

market of Homemade Potato Ramen are those 6yrs old to 60 yrs old above, this are the

people who are student, employed, unemployed and self-employed that are located at

barangay Laoac in the municipality of Alcala, Pangasinan. Researchers came up with this

study because Filipino really love eating ramen especially those homemade that are

fresh, healthy and nutritious potato.

Demand and Supply Analysis

The demand and supply analysis will help the business as it indicates how much

of the product is consumed and bought at a particular period of time. It is essential to

know the demand of our product in order to answer our customer needs and wants.

Knowing the demand will help our business to determine the trend of our product.
 Analyzing the demand thoroughly will help to give the projection of the total

number of quantity of the product that we are going to produce daily, weekly, monthly

and annually.

To calculate the total respondents of the business, we used the slovins formula.

Formula of Getting the Total of our Respondents.

Slovins Formula: n= N/1 + ( N*e*e)

Where:

N = total population

n = sample size

e= margin of error

Total population = 3, 967

Margin of error = 5%

Number of Respondents =?

NR = number of target market ÷ (1+number of target market*.05*.05)

NR = 363.36 or 363

Demand Analysis
 Demand analysis is done to estimate or find out the customers demand for a

product or service in a particular market.

In the municipality of Alcala, Pangasinan at the barangay Laoac, the researchers

gathered information by floating survey questionnaires to the respondents.

Table 3.

Frequency of Respondents who eat “Ramen”

Category Frequency Percentage

Yes 363 100%

No 0 0

TOTAL 363 100%

Completed 363 respondents are answered yes that they are eating ramen

Table 4

Frequency of Respondents who wants to buy “Homemade Potato Ramen “

Category Frequency Percentage

Yes 339 93.39%

No 24 6.61%

TOTAL 363 100%

This tables shows the percentage of the consumer who are willing to buy the product.
The 339 of the respondents answered YES which means they are willing to buy
“Homemade Potato Ramen” and 24 of them said no that they are not willing to buy.

Table 5

Sales Rate of Homemade Potato Ramen

Category No. of Respodents Percentage

Everyday 22 6.06%

Once a week 153 42.15%

Twice a week 166 45.73%

Thrice a week 22 6.06%

TOTAL 363 100%

This table shows how often the respondents will purchase the “Homemade Potato

Ramen” and they answered “Daily” the number of respondents answered 22 which is

6.06%, some of them answered “Once a week” 153 respondents which is 42.15%, and

“Twice a week” 166 respondents which has the large of percentage of 45.73%. The

remaining respondents which is the “Thrice a week” is 22 which is percentage of 6.06%.

Supply Analysis

The researchers saw that there is no supply because there is no other competitor

of the Homemade Potato Ramen at barangay Laoac, Alcala Pangasinan.

 Table 6

Demand and Supply Gap

If we sell homemade Frequency Percentage

ramen noodles flavoured
with potato, are you
willing to buy?

Yes 339 93.39%

No 24 6.61%

Table 7

Sales Forecast of Homemade Potato Ramen

Category Selling Quantity Daily Sales Monthly Annual

price Sales Sales

Ramen Plain ₱ ₱ ₱ ₱

Ramen Egg

Ramen
Siomai

Ramen Beef

Ramen
Chicken

Total ₱ ₱ ₱
 Table 8

Five-Year Projected Sales Forecast

Category Year 1 Year 2 Year 3 Year 4 Year 5

Ramen Plain ₱ ₱ ₱ ₱ ₱

Ramen Egg

Ramen
Siomai

Ramen Beef

Ramen
Chicken

Total ₱ ₱ ₱ ₱ ₱

Assumption: The sales of Homemade Potato Ramen is estimated to increase

20% yearly.

Marketing Strategies

In every business, it is very important to have a plan for its success. It is vital for
the business to design a comparative marketing strategy. A number of techniques will
be employed to make sure that the marketing plan is effectively delivered. The first step
will start from spreading the flyers, the product itself in order to capture the attention of
target market; this also includes putting tarpaulin in different strategic places near the
location of the business and the use of the social media.

Product

Homemade Potato Ramen will innovate the typical ramen by including the

potato in its recipe which is nutritious because of the benefits of potato recipe and also

its toppings. Customers looking at not just affordable but also the benefits that the

product can provide with satisfaction. Our product is not only made to satisfy the taste

or craving of the customers but also to give them health benefits that came from the

potato.

Figure 4 Product Packaging

Price
Price covers the actual amount where the end user is expected to pay for a product.

How product is priced will directly affect it sell.

The researchers agreed that the price of the potato ramen will be determined

through the cost of raw materials, labor cost, production tool and other expense in

order to satisfy the expectations of the customers.

Projected Cost of each Potato Ramen.

Table 9

Manufacturing Cost of Plain Potato Ramen

Direct Materials ₱

Direct Labor

Manufacturing Cost

Premium Expense

13th Month Pay

Depreciation Expense
 Transportation Expense

Utility Expense

Miscellaneous Expense

Communication Expense

Promotional expense

Indirect Materials

Total ₱

Unit Cost (UC) = total cost of raw materials/ total quantity produced

Unit Cost (UC) = ₱

=₱

Selling Price (SP) = (UC * 40%) + UC

=₱

Table 10

Manufacturing Cost of Egg Potato Ramen

 Direct Materials

Direct Labor

Manufacturing Cost

Premium Expense

13th Month Pay

Depreciation Expense

Transportation Expense

Utility Expense

Miscellaneous Expense

Communication Expense

Promotional expense

Indirect Materials

Total

Unit Cost (UC) = total cost of raw materials/ total quantity produced

Unit Cost (UC) = ₱

=₱

Selling Price (SP) = (UC * 40%) + UC

 =

=₱

Table 11

Manufacturing Cost of Siomai Potato Ramen

Direct Materials

Direct Labor

Manufacturing Cost

Premium Expense

13th Month Pay

Depreciation Expense

Transportation Expense

Utility Expense

Miscellaneous Expense

Communication Expense

Promotional expense

Indirect Materials

Total
Unit Cost (UC) = total cost of raw materials/ total quantity produced

Unit Cost (UC) = ₱

=₱

Selling Price (SP) = (UC * 40%) + UC

=₱

Table 12

Manufacturing Cost of Beef Potato Ramen

Direct Materials

Direct Labor

Manufacturing Cost

Premium Expense

13th Month Pay

Depreciation Expense

Transportation Expense

Utility Expense

Miscellaneous Expense
 Communication Expense

Promotional expense

Indirect Materials

Total

Unit Cost (UC) = total cost of raw materials/ total quantity produced

Unit Cost (UC) = ₱

=₱

Selling Price (SP) = (UC * 40%) + UC

=₱

Table 13

Manufacturing Cost of Chicken Potato Ramen

Direct Materials

Direct Labor

Manufacturing Cost
 Premium Expense

13th Month Pay

Depreciation Expense

Transportation Expense

Utility Expense

Miscellaneous Expense

Communication Expense

Promotional expense

Indirect Materials

Total

Unit Cost (UC) = total cost of raw materials/ total quantity produced

Unit Cost (UC) = ₱

=₱

Selling Price (SP) = (UC * 40%) + UC

=
 =

=₱

Place

Place is often referred as the distribution channel. It is where a product can be

purchased. It is how an organization will distribute their product to the customer.
Efficient and effective distribution is important if the organization is to meet its overall
objectives. The place of the proposed business is located at barangay Laoac, Alcala
Pangasinan. It is considered as strategic location for a business because the business will
be accessible enough to meet the needs of our target market.

Channel Distribution

The researchers will choose direct distribution. A form of distribution where the

product is directly from producer to customers. And the customers of the business are

the residence of barangay Laoac, Alcala Pangasinan.

PRODUCER CUSTOMER

Figure 5 Distribution Channel

Promotion
 Promotion refers to any type of marketing communication used to inform

or persuade target audiences of the relative merits of a products, services, brand or

issue. The aim of promotion is to increase awareness, create interest and create brand

loyalty. For the promotion of Homemade Potato Ramen ,the researchers will be using

different promotional tools. The business promotion campaign will start with lower

price practices such as flyers, and tarpaulin.

Promotional Activities

Flyers - we will give flyer to the people of Barangay Laoac and other neighboring

barangay to let them know about the newly introduced product in the market of the

municipality of Alcala Pangasinan at Barangay

Laoac.
 Figure 6 Flyer

Tarpaulin- the tarpaulin will be located at the business place.

Figure 7 Tarpaulin

Facebook page- now a days most customers and businesses are using Facebook. It is

very important to be more recognized to the existing product.

 Figure 8 Facebook Page

Word of mouth- encouraging all the customers to recommend the homemade potato

ramen to their families, friends and acquaintance to be recognize the business more.

Table 14

Promotional Expense

Particulars Quantity Price Cost Monthly Annually

Tarpaulin 1 ₱250 ₱250 ₱250 ₱250

Flyers 100 ₱1000 ₱1000 ₱1000

₱10

Total ₱1250

amount
 Table 15

Five-Year Projected Promotional Expense

Particulars Qty. Price Cost Year 1 Year 2 Year 3 Year 4 Year 5

Tarpaulin 1 ₱250 ₱250 ₱250 - - - -

Flyers 100 ₱1000 ₱1000 975 950 925 900

Total ₱1250 ₱975 ₱950 ₱925 ₱900

amount

Key Players and Competitors

The Homemade Potato Ramen is a new plater in the market which is desired to

gain profit and to attract customers at the Barangay Laoac, Alcala Pangasinan. In this

part of the business is critical because researchers need to analyze the competitors and

think of some technique in order to gain more customers. However, researchers saw

that there is no other competitor of the product.

Market Share
The market share is a company’s portion of sale within entire market in which it

operates. It represents the percentage of customers that a company has captured from

its specific desired market within industry. Since the Potato Ramen has no competitors,

it can be assumed that the Homemade Potato Ramen can hold 100% of the market

share

Homemade Potato Ramen

Figure 9 Market Share

SWOT Analysis:

It is a tool to use if the organization wants to take a step back and assess the

situation they are in issues raised from the analysis and then used to assist the

organization developing their marketing mix strategy.

 Table 16

SWOT Analysis

STRENGTH WEAKNESSESS

Product is freshly made. New in the market.

Serve a healthy and nutritious ramen Not well known by the customers.

Uniqueness of the recipe of ramen

The only one offering ramen in the Laoac.

OPPORTUNITIES TREATS

Developing new product. Entering of new competitor.

Increase consumer expectation. Climate change/natural disaster.

Continue discover other nutritious Rising cost of raw materials.

ingredients that can be used for ramen

Artificial flavors.

Health conscious individuals can enjoy this

Economic situation.
kind of healthy and nutritious ramen.

Making a remarkable product to the

customer because it is new in the market.