Strategic management paper Petersen Merchandising

• Main Author: Ang, Penelope Cindy K.
• Format: text
• Language: English
• Published: Animo Repository 2006
• Subjects: Merchandising > Philippines; Petersen Merchandising
• Online Access: https://animorepository.dlsu.edu.ph/etd_masteral/3646
• Institution: De La Salle University

Building materials are defined as the physical substances used for construction purposes. The building materials industry encompasses a very broad sector, the focus of this paper will be on two subsets of building materials: screening materials and abrasive products. Based on the data gathered on the macroenvironmental factors, as well as taking into account Michael Porters Five Forces Model, the following threats were identified: (1) increasing population (2) implementation of E-VAT (3) political instability of the country (4) increasing minimum wage rate (5) technological advancements such as GPS, 3G, and VoIP and (6) increasing demand yet decreasing supply for natural resources. All these factors slow down industry growth and enable buyers to achieve bargaining power. The political volatility situation of the country will also increase suppliers bargaining power while technological developments will increase threat of entry. At the other end of the spectrum are the factors that will spur development, thus, they are opportunities to the industry: (1) growing housing need (2) rising interests in houses located in resort communities (3) higher income, higher consumption (4) projected declining inflation rate (5) continuing economic growth (6) lower interest rates (7) real estate boom and steady growth of the construction industry and (8) development of transportation infrastructure. Petersen Merchandising is a sole proprietorship and its main line of business is importation of insect screening materials and sanding papers. The following aspects are considered to be the company's strengths: (1) established client-supplier relationship because this ensures quality and sustainability of the products. It is also a sign of cordial professional relationship that enable both suppliers and buyer to maximize efficiency and profitability (2) highly liquid condition and timely collection of receivables that enables the company to meet all its short-term obligations and turn sales into effective use of cash flow (3) reputation for fast delivery and good customer service which is a must in every business (4) strong dealer network in Manila that enables the company to have consistent trades and transactions and (5) centralized warehouse facility that minimizes overhead cost and ensure systematic delivery of goods.