Corporate strategies for Ester Corporation

• Main Author: Onia, Ramoncito D.
• Format: text
• Language: English
• Published: Animo Repository 1998
• Subjects: Business Administration, Management, and Operations
• Online Access: https://animorepository.dlsu.edu.ph/etd_masteral/2219
• Institution: De La Salle University

Ester Corporation (Hereinafter referred to as the Company) is the owner and operator of a chain of 30 stores as at August 31, 1996, 27 of which are configured as convenience store, also known as C-stores, with pharmacies. These stores are known in the Visayas region as Farmacia Ester, or ESTERS-Your Personal Store. The Company continued to control approximately 60 percent of the prescription and over-the counter pharmaceutical retail market in Iloilo City while Mercury Drug Corporation accounted for about 20 percent only. The company also operates in Cebu province with seven stores and in Negros Occidental with six stores. The pharmaceutical industry is faced with high threat of entry, low threat of substitutes, high bargaining power of suppliers and buyers, and intense rivalry among key players. The Company has identified some opportunities like high product awareness among consumers and strong presence of government intervention. On the other hand, some threats encountered are the alliance of drugstore giants with suppliers and the unsaturated industry situation. The company has identified that its major strength is its loyal customer base. Unfortunately, it is threatened by shortage of capital for the moment. However, this can be converted soon into a strength as the negotiation for the P40.0 million 11% cumulative convertible redeemable preferred shares will be finalized sometime within the year. The proposed strategies for the Company are expanding geographic market to Mindanao, introduction of new operating system particularly inventory control, expanding product lines complementing existing products, and increasing capacity in strategic centers. These four strategies are envisioned to meet its objectives lined for this year namely, increasing its domestic retail network in the Southern Philippines and its twin financial objectives of increase sales within 30 to 35% by the year 200, and containing operating expenses to 14.75% of net sales by the year 200 also. The strategies are also align with mission of providing are at the right time. It will also fulfill their vision of becoming the dominant force in pharmaceutical retailing and convenience stores in the Visayas and Mindanao regions.