Graduate School

NOTRE DAME OF MARBEL UNIVERSITY

CHAPTER IV

INTERNAL ANALYSIS OF THE COMPANY

This chapter explores the various aspects of the company to show in detail how

each one works and how each one contributes to the overall operation of the company.

It discusses the company’s equipment, raw materials, productions and marketing

processes. It also analyzes the company’s payroll structure, records keeping and

financial aspect.

Type of Organization

Jo Ann’s Bakeshop has been a single proprietorship since 1968. Since it is a

family-owned business, the owner’s niece and nephew are the manager and the

supervisor respectively.

Organizational Structure

The company is a family-owned business, thus the owner’s niece and nephew

are the manager and supervisor respectively. To this day, the owner still does regular

rounds at the different branches. Each department has been trained to work cohesively

in order to increase work efficiency in a harmonious setting.

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

The figure below shows the different department of the main branch and its chain

of command.

OWNER

MANAGER

SUPERVISOR

CAKE MAKER CASHIER MASTER BAKER DRIVER CARPENTER SECURITY

CAKE CASHIER’S DRIVER’S CARPETER’S

MASTER’S ASSISTANT MASTER’S ASSISTANT 2 PASTRY COOK

Figure 1: Organizational Chart of Jo Ann’s Bakeshop

Listed on the succeeding pages are the positions, duties and responsibilities of

both the management and the rank and file employees for the main branch.

Table 2: Duties and Responsibilities of the company’s top management

Top Management Duties and Responsibilities

Owner -Does random quality control of bread and other

products at both production outlets

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

-Gives final approval for all transactions and purchases

Manager -Records the daily income and expenses of the bakery

-Schedules the dates of payment and signs the checks

for the various suppliers of the bakery

-Calculates the selling price for any new product;

adjusts the price list if there is a price increase

-Transacts with the Bureau of Internal Revenue,

Department of Trade and Industry and other

government agencies

Supervisor -Assures quality control of bread, other bakery products

and fastfood menu

-Monitors the status and working condition of all

vehicles and mechanical equipment

-Makes the daily bank deposit

-Prints the checks for the accounts payable once the

confidential assistant hands him the completed

vouchers

Table 3. Duties and responsibilities of the company’s middle management

Middle Management Duties and Responsibilities

Confidential Assistant -Makes orders to the suppliers and receives their

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

deliveries

-Prepares the vouchers all accounts payable

-Hands out the checks and vouchers to the collectors

when they arrive; records which collectors have not

been paid

-Helps other employees at the wholesale department

once her other duties are done

-Has the authority to act and decide on matters if the

supervisor and manager are not present

Cashiers -Receives payment from customers and hands them

their change

-Check and receive consignments of kakanin and other

food items

-Pay the consigners for the food items they delivered

the previous day

-Make the attendance record for payroll computation

Wholesale Department -Prepares the wholesale buyers’ orders; computes the

In-Charge discounts for them

-Makes out official receipts for customers

-Attaches the price tags to the breads before they are

placed on the display shelves

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

-Make daily inventory of the display shelves’ contents

The bakery’s goal is to provide a long-term and stable employment for deserving

employees. Any skills and abilities they already have will be developed and refined to

make them more complete individuals and help them secure a better future.

The company has about 132 employees. All of their employees enjoy benefits

such as 13th month pay, SSS, Philhealth and Pag Ibig. They also have sick leave,

vacation leave and cash advances. The rank and file employees receive minimum wage

pay amounting to P311 plus free meals during the shift.

Fifty persons or seventy percent of the current, regular employees of Jo Ann’s

began their careers with the bakery when they were 18 to 21 years old. They started at

the bottom of the organization and those with potential were either apprenticed to their

more experienced co-workers or sent to attend training programs.

Even the regular bakers take part in teaching demonstrations conducted by the

bakery’s suppliers: they in turn teach what they learned to their fellow employees.

Thirty-three persons or 46% of the employees are also beneficiaries of the

National Home Mortgage Program. Upon full payment, they will own the lots where they

have built their homes. The management encourages the employees to send their

children to school and assists them in getting into scholarship programs to increase

their chances of independence and success after graduation.

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

Production Process

Production refers to the process in which a business converts raw materials into

goods to be sold for profit. Listed below are the production processes for three of Jo

Ann’s most popular products. As per owner’s wishes, the ingredients/ weights and their

specific classification (brown sugar, first-class flour, etc.) have been omitted.

Chiffon Cake

Batter

1. Combine baking powder, sugar and egg white in a mixing bowl.

2. Whip until all ingredients are thoroughly mixed and free of lumps.

Icing

1. Combine baking powder, sugar and egg white in a mixing bowl.

2. Whip at high speed until it achieves a white, fluffy consistency.

Combine the batter and icing, mix thoroughly and pour into baking tins. Place

immediately in an oven set at high heat for forty-five minutes. Once cooked; allow cake

to cool down before removing it from baking pans.

Cream Bread

1. Combine flour, milk powder, sugar, yeast, baking powder, lard and water on a

mixing bowl. Turn the mixer on and allow all ingredients to mix.

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

2. Once the dough has the right consistency, cut into pieces. Use a weighing

scale

to ensure each piece has the same weight. Place them in baking tins and

allow the dough to rest and proof.

3. Once proofing is done, carefully load the baking tins into an oven set at

medium

heat to cook.

4. After the bread is cooked, allow the loaves to cool before slicing and

packaging.

Siopao

1. Prepare, season and cook fresh, youngv pork for the filling.

2. Hard boil fresh chicken eggs, cool, remove and divide into six slices.

3. Prepare the cooked pork meat which will be used for filling the siopao.

4. Combine flour, salt, yeast and water in the mixing bowl to make the dough.

5. Once the fresh dough is made, use the rollers to knead it to the right

consistency.

6. Slice the dough into strips. Cut and weigh the strips into individual pieces or

twist off individual pieces by hand from the strip.

7. Flatten the individual pieces of dough; place a slice of egg and pork filling in

the

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

center.

8.Wrap each siopao by hand to give them their traditional appearance.

9. Stick a square or waxed papers on the bottom end of the siopao before

placing

them on the bamboo steamer. The paper prevents the dough from sticking

to the bamboo.

10. Steam the siopao for twenty minutes to cook them.

The figure below shows the production process of Jo Ann’s Bakeshop.

Figure 2. Daily Operational Production Flow Chart

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

Figure 3. Production Flow Chart of Chiffon Cake

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

Bakery Equipment

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

The bakery industry exclusively uses a group of machines and equipment to

produce bread on a commercial scale. The most crucial is the oven. Hwere the dough is

baked into bread. Traditional ones are made out of brick, insulated with rice hulls and

fueled by wood; they never completely cool down even when not in use and are

cheaper to operate. The modern stainless ones are fueled by LPG and are costlier

because of their fuel and they return to room temperature when not in use. LPG fueled

ovens need to be brought up from cold to operating temperature daily, wasting valuable

liters of LPG in the process. Jo Ann’s limits the use of its LPG-fueled oven to five to six

hours daily to lessen fuel expenses.

Distribution

Consumers for a particular good or service can be divided into two categories.

Ultimate consumers buy a product for their own use while business users buy a product

to use in their own business or industries (Sommers, Barnes & Stanton). Ultimate

consumers for Jo Ann’s products are the walk in customers who select and pay for their

choice of bread and either eats it immediately or at a later time. Business users for Jo

Ann’s products are the wholesalers, caterers and gift givers.

Nine of the twenty regular wholesalers are based within the city at locations such

as the bus terminal or the fish port. Three are from Maasim, Sarangani Province and the

remainder is based in Balut Island. Seasonal wholesalers purchase bread for the

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

Christmas and New Year holidays. These persons are based in various parts of Davao

del Sur such as Digos, Bansalan, Santa Maria and Padada.

Wholesalers have no exclusivity contracts with Jo Ann’s Bakeshop. They are free

to display Jo Ann’s products beside those from other bakeries in their stalls. The

amount and frequency of their purchase are based on the demands of their ultimate

consumers. There have been recorded instances of wholesalers especially those in bus

terminals closing their businesses because of their shops were located to sites less

frequented by customers.

Caterers buy the bakery’s products to serve as snacks in events such as

meetings and parties They find it cheaper to order bread, especially those which already

have filling than to make their own snacks or use cream or butter bread loaves in

making sandwhiches. Gift givers buy Jo Ann’s products to give as pasalubong to their

friends and relatives when they return home. Most of these customers were originally

from Genera Santos City and had developed a taste for Jo Ann’s products.

SWOT Analysis

SWOT is used for the analysis of the overall strategic position of the business

and its environment. It can identify the strengths that will create a business model that

will best align an organization’s resources and capabilities to its operating environment.

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

Proper use of SWOT analysis allows a business to capitalize on its strengths to

correct its weaknesses and help the company cope against external threats and to

recognize and exploit new opportunities faster than its competitors.

Strengths

Company Reputation

The company has established a reputation as a maker of high quality products.

Its products have been recognized to have consistent high standards so that they are

purchased and brought to different parts of the country as pasalubong. It has its share

of loyal customers, final consumers, as well as wholesalers, who make daily or weekly

purchases at both of the company’s retail outlets.

Change of New Outlet Location

The main branch has recently changed its location. Previously the main branch

was at Pedro Acharon Boulevard, now they have relocated at corner Bula Road fronting

GenSan Public Market. The newly transferred branch has been a successful move for

the company. The new location did not hinder sales because they consider Jo Ann’s as

the

oldest and the most-sought after restaurant then before the emergence of popular fast-

food chains into the city. It never failed to attract diners because of its tasty bread and

cakes.

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

Ability to Mass Produce

The company’s brick ovens, high level of mechanization, experienced workforce

and adequate supplies in storage give it the capacity to produce large quantities of

products when needed. This allows the company to accept bulk orders and lessens

production costs.

Reliable Employees

All employees who are involved in making bread dough and cake batter have

been with the company for at least 10-15 years. This means keeping the products’

tastes and quality very consistent. The employees are also happy and content with their

wages, working hours and working conditions.

Financial Stability

The company has sufficient liquidity to implement any plans to increase the

number of retail outlets or to acquire new bakery equipment. The company is not

dependent on credit or loans as a source or operating income.

Weaknesses

Single Proprietorship

The company’s owner still makes all major decisions. The manager and

supervisor can only give additional information, make comments or suggestions to her.

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

This practice sometimes slows down the decision making process or allows

opportunities to pass by.

Rental Scheme

The branches are all on a long term lease. The monthly rate and yearly increase

are reasonable and well within the company’s ability to pay.

Limited Advertising

The company has been too resilient on word of mouth advertisement.

Opportunities

Franchising offers

Numerous individuals have made offers to acquire a franchise from Jo Ann’s

Bakeshop. The only concerns of the management is the difficulty in monitoring the

product quality of the franchise and the risk that the company’s recipes be made in

public.

Additional Branches

The company management has been looking for ideal rental spaces on well-

populated locations to establish additional retail outlets. These proposed outlets will still

be under Kho family control.

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

Malls have also made offers to the company’s owner to rent a display area or

stall inside their premises.

Debt Financing

A bank loan or credit line can help the company realize its plans to finalize and

pursue franchising.

Threats

Bakeshop retail outlets inside malls

Every shopping mall inside General Santos City has its own resident bakery

inside it. Other competing bakeries also rent spaces/stalls inside the malls to display

their products. These stalls take advantage of location and of impulse buying of the

shopper to sell their products.

Unfair competition

The public markets and small variety (sari-sari) stores display cheaper bread and

biscuits produced by unlicensed bakeries.

Table 4 Jo Ann’s Bakeshop SWOT Analysis

Strengths Weaknesses

1. Company reputation 1. Single proprietorship

2. Change of new outlet location 2. Rental scheme

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

3. Ability to mass produce 3. Limited advertising

4. Reliable employees

5. Financial stability

Opportunities Threats

1.Franchising offers 1. Bakeshop retails outside the mall

2. Additional branches 2. Unfair competition

3. Debt financing

The figure above is a summarized version of the SWOT Analysis for Jo Ann’s

Bakeshop. This is the basis for the SWOT Matrix and other evaluations the researcher

will conduct on the company in order to come up with strategies to overcome the

company’s weaknesses and threats and take advantage of its strengths and

opportunities.

Table 5 SWOT Matrix for Jo Ann’s Bakeshop

Internal

Environment
Strengths Weaknesses

1. Company reputation 1. Single proprietorship

2. Change of new outlet location 2. Rental scheme

3. Ability to mass produce 3. Limited advertising

4. Reliable employees
External
5. Financial stability
Environment

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

S/O Strategy W/O Strategy

Open more branches in suitable, well populated Lessen decision making time (W1, O1, O2)
Opportunities
locations (S1, S2, S3, O2, S5) Increase capital by making more collections
1. Franchising offers
Secure bank loan to finance the company’s from other outlets (W3, O2)
2. Additional branches
expansion plans (S1, O2)
3. Debt financing

S/T Strategy W/T Strategy

Introduce new types of bread more frequently Put up additional stalls inside malla (T1, W3)
Threats
(S1, S3, T1)
1. Bakeshop retails
Consider renting stall spaces in the top three
inside malls
malls of the city (S1, S4 T2)
2. Unfair competition

Listed on the previous page is the SWOT Matrix for Jo Ann’s Bakeshop. It shows

the various strategies the researcher came up with to encounter the weaknesses and

threats to the company while using its strengths to take advantage of opportunities.

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 Graduate School
NOTRE DAME OF MARBEL UNIVERSITY
Alunan Avenue, City of Koronadal 9506
South Cotabato, Philippines

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