A strategic management plan for Armed Forces of the Philippines Commissary & Exchange Service (AFPCES)

• Main Author: Quinsay, Edgar F.
• Format: text
• Language: English
• Published: Animo Repository 1997
• Subjects: Business Administration, Management, and Operations
• Online Access: https://animorepository.dlsu.edu.ph/etd_masteral/2239
• Institution: De La Salle University

The Armed Forces of the Philippines Commissary and Exchange Service, and entity engaged in retail business serving the military communities, started out in 1972 with an initial working capital of P5.0 M borrowed from the Philippine Veterans Bank. After 24 years, AFPCES has grown into a big retail network with 34 branches nationwide and with total resources amounting to P532.159M as of 31 December 1995. Sales figure for 1995. Sales figure for 1995 amounted to P1.4 B worth of merchandise and this sale represents a 25% growth from the preceding year. AFPCES experienced a steady growth for the last 5 years utilizing strategies that are primarily directed toward serving its mandated customers. Also, this steady growth was achieved because of the tax-subsidy granted by the government in 1986. This tax-subsidy remained the most important factor in AFPCES retail operations up to this time because of the price advantage it gives to AFPCES as against its competitors. After analyzing the financial picture, assessing the companys strength goods and services to authorized customers at reasonably low prices in order to enhance their socio-economic well-being, AFPCES must aim in the next five years to have wider coverage and expanded service to its authorized customers. This goal must be pursued through aggressive growth in all areas in order to attain a gross profit margin of at least 7%, a net income to sale of at least 2%, an increase in sales by 20% annually and an increase in patronage of customers by at least 15% yearly. The over-all strategy to be pursued by AFPCES must be cost-leadership. The very competitive environment will compel AFPCES to become more aggressive in pricing, and therefore find ways to make their products cheaper compared to its competitors. In support of this strategy, a cost-reduction program must be pursued which will improve competitiveness and profitability. Also, full product lines must be maintained, increase presence through of more outlets must be mare and low-priced leadership must be sustained at all times. Moreover, a strong company image must be developed for AFPCES as a value-priced and service-oriented firm. To support the aforementioned financial and marketing efforts, it must also develop a strong distribution network, decentralized warehousing and must undertake facilities improvement. Participative management plus the utilization of consultancy services will help in the effort of professionalizing the ranks of AFPCES. An efficient IT must also be made as part of AFPCES strategy. With the new strategies in place, AFPCES is expected to continue it growth to better serve and expand its coverage of its authorized customers who are the men in uniform, the retired military personnel, the veterans and their dependents.