motosuit marketing audit
TRANSCRIPT
1MS Motosuit: Marketing Audit
SCOPE OF MARKETING AUDIT
Introduction
Executive Summary
Major Assumption
Product Description
Knowledge of the Market
Basis for Demand Computation
Basis for Supply Computation
Market Share
Product Planning
Channel of Distribution
Customer Relation and After-Sales Service
Promotional Programs
Pricing
Sales Force Management
Packaging
Summary of Results and Findings
2MS Motosuit: Marketing Audit
INTRODUCTION
In making a good company study, marketing audit is one
of the bases to consider. Marketing audit is a fundamental
part of the marketing planning process. It is conducted not
only at the beginning of the process, but also at a series
of points during the implementation of the plan.1
The marketing audit has certain similarities to a
financial audit in that it is a review or appraisal of your
existing marketing activities.2 Carrying out the marketing
audit provides the opportunity to review and appraise your
whole marketing activity, enabling you to assess past and
present performance as well as to provide the basis for
evaluating possible future courses of action. The business
environment is constantly changing. The marketing audit
should be used as a reference tool, with constant updates
reflecting changes in the external environment and your own
internal business experiences.
1 http://www.marketingteacher.com/lesson-store/lesson-marketing-audit.html2 http://www.cim.co.uk/marketingplanningtool/tech/tech5.asp
3MS Motosuit: Marketing Audit
EXECUTIVE SUMARY
4MS Motosuit: Marketing Audit
MAJOR ASSUMPTION
5MS Motosuit: Marketing Audit
DEFINITION OF RATINGS
S- Satisfactory (3.26 – 4.0)
These items represent the strong points of an
enterprise. Attention to these points is to be maintained as
long- term issue.
R- Reasonable (2.51 – 3.25)
Prevailing conditions are such that improvement cannot
be expected to lead immediately to tangible result as
compared to the effort to be made.
ID- Improvement Desirable (1.76 – 2.50)
Improvements are expected to result in cost savings,
additional or tangible result.
IN- Improvement Necessary (1.0 – 1.75)
An immediate action is considered urgent.
6MS Motosuit: Marketing Audit
TABLE 1
SUMMARY OF RATINGS
Audit Item Particulars Individual RatingOver-all Rating
Interpretation
1.00 2.00 3.00 4.00
Knowledge of the Market
KnowledgeCompletenessProductAverage
Channel of Distribution
EffectivenessEfficiencyAverage
Sales Force Management
EffectivenessEfficiencyProductivity
AverageCustomer Relations and After Sales
EffectivenessMotivationCustomer
SatisfactionAverage
Advertisement and Promotion
EffectivenessEfficiencyAverage
Pricing
EffectivenessCustomer
SatisfactionAverage
PackagingEffectiveness
CostsAverage
7MS Motosuit: Marketing Audit
PRODUCT DESCRIPTION
Product could be a good, idea, method, information,
object, service, and many more. An end result of a process
that most closely meets the requirements of a particular
market or segment and yield enough profit to justify its
continued existence.3
For the subject company, MS MOTOSUIT brand has now
become the most recognized and best selling brand of durable
motorcycle seat cover in the Philippines today. These seat
covers are the result of years of hard work in finding the
best design, comfort and durability for one’s riding
experience.
MS MOTOSUIT is also in developing bar pads, dual seat
assembly and apparels for high intensity, physically
demanding world of motorcycle enthusiasts. Through
organizing and working closely with the best riders in the
history of motocross racing, the company has researched and
developed race accessories, seat covers and clothing that
provides riders with maximum comfort and performance. For
more than a decade MS MOTOSUIT has created the best
motorcycle apparel and seat cover in the Philippines, which
is able to withstand the elements and the torturous racing
3 (http://www.businessdictionary.com/definition/product.html)
8MS Motosuit: Marketing Audit
and riding conditions. Shown below are the product’s
representations.
FIGURE 1
MS MOTOSUIT PRODUCT LINE4
Motorcycle seat covers
Back packs
Apparels4 www.msmotosuit.com
9MS Motosuit: Marketing Audit
The main product line of MS Motosuit is motorcycle seat
covers of different styles and design. For this study, the
proponents will focus only on the motorcycle seat covers as
the subject of the study.
Thongs T-Back Boy Cut Panty
10MS Motosuit: Marketing Audit
AREA OF AUDIT : MARKETING
ITEM : KNOWLEDGE OF THE MARKET
RATING :
I. FINDINGS
A. STRENGTH (S)
The company is the first to manufacture motorcycle
seat covers here in the Philippines since year
2000.
The company exists for almost 10 years since they
legally registered their business from the year
2000.
During the first 5 years of its operation, the
company has able to monopolize the entire
Philippine market in terms of motorcycle seat
cover.
The company caters different dealers in the Luzon,
Visayas and Mindanao region.
The company has able to establish connection with
motorcycle company here in the Philippines.
The company has three stores here in the Visayas,
particularly in Mandaue City, Jones, and Tabugon,
Cebu.
The company is manufacturing quality products.
11MS Motosuit: Marketing Audit
The company has good relationship with their
suppliers.
The company is aware of their lean and peak
periods.
The company has been able to determine some of
their direct competitors.
The company has set their target sales of no less
than 1000 pcs of set covers per month.
B. WEAKNESS(ES)
The company was not able to identify some of their
competitors especially those small competitors.
Due to high competition, the company is
experiencing a decrease in their demand.
C. OPPORTUNITY(IES)
Expanding their market outside the Philippines
Visayas and Mindanao.
D. THREAT(S)
Sales might decrease due to lots of competitors.
Expansion of major competitors.
Decrease in the demand of the product due to
customer preferences.
II. PROPOSED OPTION(S)
Maintain and improve the strong points.
Maintain a good relationship with the suppliers.
12MS Motosuit: Marketing Audit
Create other store outlets in Luzon and Mindanao.
Expand the target market as to outside of the
Philippines.
III. BENEFIT(S)
Having a good relationship with the suppliers, thus
practicing a supply chain management will ensure
that the company will receive a quality raw
materials from their suppliers. In terms of
delivery, it would be in time and problems will be
avoided. Thus, their supplier will be loyal to the
company.
By expanding their target market in Luzon and
Mindanao area and outside of the country, this will
give the company a wider coverage of customers,
increase the company’s sales thus having good
profitability.
13MS Motosuit: Marketing Audit
BASIS FOR DEMAND COMPUTATION
The demand of this study focuses on the number of
motorcycles all over the Philippines since MS Motosuit is
catering the regions of Luzon, Visayas and Mindanao.
The proponents had identified the number of
motorcycles registered in the Land Transportation Office.
Though the internet, the proponents had able to identify the
total number of motorcycles here in Cebu and its percentage
from the total number of motorcycles in the Philippines in
2005. Using the principle of ratio and proportion, the
proponents computed the estimated number of motorcycles all
over the Philippines in 2005.
The proponents had also able to gather information on
the percentage of motorcycles from the total number of
vehicles in the Philippines in the years 2004 and 2005.
Using this data, the proponents computed the rate of
increase in the number of motorcycles in the Philippines
from 2004 up to 2005.
Using the estimated rate of increase in the number of
motorcycles in the Philippines, the proponents projected the
past and future demand.
14MS Motosuit: Marketing Audit
TABLE 2
NUMBER OF MOTORCYCLES IN CEBU, 20055
Number of Motorcycles
Percentage from the Total Number of
Motorcycles in the Philippines (%)
123,417 5.3
TABLE 3
TOTAL NUMBER OF MOTORCYCLES IN THE PHILIPPINES
Year Number of Motorcycles
2005 2,328,623
COMPUTATION:
Let x = Total Number of Motorcycles in the Philippines
123, 417 : 0.053 = x : 1
X = 2, 328, 623
5 http://www.nscb.gov.ph/panguna.asphttp://www.abs-cbnnews.com/lifestyle/10/14/10/motorcycles-rule-philippine-roads
15MS Motosuit: Marketing Audit
TABLE 4
RATE OF INCREASE (2004- 2005)6
2004 (%) 2005 (%)
Growth Rate (%)
Percentage of Motorcycles from the Total Number of vehicles in the Philippines
41.4 46.9 5.5
6 http://www.nscb.gov.ph/panguna.asphttp://www.abs-cbnnews.com/lifestyle/10/14/10/motorcycles-rule-philippine-roads
16MS Motosuit: Marketing Audit
TABLE 5
COMPUTATION OF PAST DEMAND
Year Growth RateNumber of Motor Cycles in the Philippines
Useful Life of a Motorcycle Seat Cover
Average Actual
Demand per Year
2005 5.5 2,328,623 5 yrs 465,7252006 5.5 2,456,697 5 yrs 491,3392007 5.5 2,591,815 5 yrs 518,3632008 5.5 2,734,365 5 yrs 546,8732009 5.5 2,884,755 5 yrs 576,951
17MS Motosuit: Marketing Audit
DEMAND ANALYSIS
The demand computation depicted on the table above is
increasing respectively starting from the year 2005 until
2009. The management makes sure that their product
distributed to the customer is durable enough in order to
get their trust.
Moreover, it was clearly shown that there are number
of motorists wants to innovate their motorcycles by putting
accessories on it since it doesn’t only looks fashionable
but also it will add elegance as well. Furthermore, MS
Motosuit Manufacturing produces seat covers to provide
customers’ needs and as well as to satisfy them. Thus, the
increase in demand every year only proves that there is an
increase in motorcycle users as well.
The above demand table restrains 5 years as useful
life of the seat covers based on the company’s view.
Therefore, the proponents divided the number of motorcycles
in the Philippines for every year which will now obtain the
demand’s value.
18MS Motosuit: Marketing Audit
DEMAND METHODS OF PROJECTIONS
After computing the average demand per year as
presented in the previous tables, the 5-year projection of
demand from 2010-2014 can be computed. The proponents used
the four methods of projection which are:
Arithmetic Straight Line (SSL)
Arithmetic Geometric Curve (AGC)
Statistical Straight Line (SSL)
Statistical Parabolic Curve (SPC)
These four methods will give different results. In
selecting the best method to be used, the proponents
considered the following aspects.
Standard Deviation
Average Growth Rate
Principle of Conservatism
For the standard deviation, the proponents considered
the method that has the smallest standard deviation, for it
may have the smallest tendency to have a discrepancy in the
results. Another consideration is the average growth rate,
in which, the smallest growth rate must be the best choice.
The law of conservatism among the average growth rate of the
four methods must also be considered. The best method must
19MS Motosuit: Marketing Audit
gave an average growth rate which is very close or equal to
the growth rate of the past data.
TABLE 6
PAST AND PROJECTED DEMAND SUMMARY
Year
DEMAND(# of
motorcycles)
ASL(# of
motorcycles)
AGC(# of
motorcycles)
SSL(# of
motorcycles)
SPC(# of
motorcycles)
2005 465,7252006 491,3392007 518,3632008 546,8732009 576,9512010 497,743 608,683 603,246 608,4532011 504,147 642,161 631,045 641,4572012 510,551 677,480 658,844 675,9502013 516,954 714,741 686,642 711,9302014 523,358 754,052 714,441 749,398Standard Deviation
51,227.28 0.36 1,244.75 22.52
AGR 5.50% 1.26% 5.50% 4.32% 5.35%
20MS Motosuit: Marketing Audit
PAST AND PROJECT DEMAND ANALYSIS
The table projected above shows the computation of the
different methods of projection which will be used so that
the demand for the next years of the company’s operation
will be projected and presumed.
However, the above computation shows that AGC
(Arithmetic Geometric Curve) is the chosen method to be used
by the proponents since it has obtained the three
requirements in selecting the best method of projection.
Hence, it has the lowest standard deviation obtained, it
conforms the law of conservatism, and finally, though it has
the highest growth rate attained yet, the value is the
nearest so as to its past demand’s growth rate is concerned.
21MS Motosuit: Marketing Audit
FIGURE 2
LINE FITTING OF PAST AND PROJECTED DEMAND
22MS Motosuit: Marketing Audit
SUPPLIES
MS MOTOSUIT AND TOP THREE DIRECT COMPETITORS
TABLE 7
MS MOTOSUIT
YearSales/week
(# of motorcycles)
Sales/month(# of
motorcycles)
Sales/year(# of
motorcycles)
2010 ------ 2, 500 30, 000
TABLE 8
RIDE IT FOREVER
YearSales/week
(# of motorcycles)
Sales/month(# of
motorcycles)
Sales/year(# of
motorcycles)
2010 400 1,600 19,200
TABLE 9
OZ (ORIGINAL ZANDRO) RACING CORPORATION
YearSales/week
(# of motorcycles)
Sales/month(# of
motorcycles)
Sales/year(# of
motorcycles)
2010 400 1,600 19,200
TABLE 10
CHARLES RACING
YearSales/week
(# of motorcycles)
Sales/month(# of
motorcycles)
Sales/year(# of
motorcycles)
2010 200 800 9,600
23MS Motosuit: Marketing Audit
SUPPLY COMPUTATION
PAST SUPPLY
TABLE 11
MS MOTOSUIT MANUFACTURING
YearGrowth Rate
Annual Sales(# of
motorcycles)
2005 43,1772006 5.5% 45,5522007 5.5% 48,0572008 5.5% 50,7002009 -30% 39,0002010 -30% 30,000
TABLE 12
RIDE IT FOREVER
YearGrowth Rate
Annual Sales(# of
motorcycles)
2005 14,691
2006 5.5% 15,499
2007 5.5% 16,351
2008 5.5% 17,250
2009 5.5% 18,199
2010 5.5% 19,200
24MS Motosuit: Marketing Audit
Continuation of Past Supply
TABLE 13
OZ (ORIGINAL ZANDRO) RACING
YearGrowth Rate
Annual Sales(# of
motorcycles)
2005 14,6912006 5.5% 15,4992007 5.5% 16,3512008 5.5% 17,2502009 5.5% 18,1992010 5.5% 19,200
TABLE 14
CHARLES RACING
YearGrowth Rate
Annual Sales(# of
motorcycles)
2005 7,3452006 5.5% 7,7492007 5.5% 8,1752008 5.5% 8,6252009 5.5% 9,1002010 5.5% 9,600
25MS Motosuit: Marketing Audit
TABLE 15
TOTAL SUPPLY
Year
Name of CompanyTotal (#
of Motorcycle
s)
Others (# of
Motorcycles)
Total Supply (#
of Motorcycle
s)
MS Motosuit (# of
Motorcycles)
Ride It Forever (# of
Motorcycles)
OZ Racing (# of
Motorcycles)
Charles Racing (#
of Motorcycle
s)2005 43,177 14,691 14,691 7,345 79,903 319,613 399,516
2006 45,552 15,499 15,499 7,749 84,298 337,192 421,490
2007 48,057 16,351 16,351 8,175 88,934 355,737 444,672
2008 50,700 17,250 17,250 8,625 93,826 375,303 469,129
2009 39,000 18,199 18,199 9,100 84,498 337,991 422,488
26MS Motosuit: Marketing Audit
TABLE 16
PAST AND PROJECTED SUPPLY SUMMARY
Year SUPPLY# of
Motorcycles
ASL # of
Motorcycles
AGC# of
Motorcycles
SSL # of
Motorcycles
SPC# of
Motorcycles
2005
399,516
2006
421,490
2007
444,672
2008
469,129
2009
422,488
2010 426,983 429,415 459,534 391,557 2011 432,476 436,455 468,892 332,939 2012 437,970 443,611 478,250 254,899 2013 443,463 450,884 487,608 157,438 2014 448,956 458,276 496,967 40,554
Standard Deviation
29,199.72
30,036.57
19,585.71
10,934.14 AGR 1.64% 1.26% 1.64% 1.98% -37.72%
27MS Motosuit: Marketing Audit
PAST AND PROJECTED SUPPLY ANALYSIS
Table 16 shows the summary of the past and projected
supply of the subject company and all the identified
competitors in the Philippines using the four methods of
projection.
Factors such as standard deviation, average growth
rate, and law of conservatism were the basis of choosing the
appropriate method. Each of the method was computed and
evaluated.
Among the four methods, Arithmetic Geometric Curve or
AGC was chosen. Although it yields the largest value of
standard deviation doesn’t mean that it has the least
undesirable results compare to the other three methods for
factors such as law of conservatism and average growth rate
were still to be considered. Next to evaluate is the
principle of law of conservatism whether the value is equal
or lesser than the annual growth rate or AGR of the past
supply. As observed, AGC gives the equal value of 1.64% to
the annual growth rate of the past supply of motorcycle seat
cover. For the last factor, the annual growth rate, the
least value of AGR the better. AGC gives the second least
positive value of AGR among the Arithmetic Straight Line or
ASL and Statistical Straight Line or SSL.
28MS Motosuit: Marketing Audit
Among the four methods of projection, Arithmetic
Geometric Curve or AGC qualifies to the factors that the
proponents will consider upon choosing the fitted method of
projection. Summing up, the Arithmetic Geometric Curve (AGC)
has the largest value of standard deviation, is equal to the
annual growth rate of the past demand, and the second least
positive value of annual growth rate. Therefore, the best
method for the projected demand would be the AGC according
to the proponents’ perception. The characteristic of the AGC
is that it is progressively increasing. The curve will
always increase and there will never be a point that it will
decrease. Relating to the computed figure, the study is all
about the motorcycle seat cover, changing the seat cover of
the motorcycle may not be a necessity for every motorcycle
drivers but the usefulness of the seat cover will always
decline in due time so replacement of the item take place.
And since the number of motorcycles in the Philippines
rapidly increases, the demand for the Motorcycle seat cover
also increases.
29MS Motosuit: Marketing Audit
FIGURE 3
LINE FITTING OF PAST AND PROJECTED SUPPLY
30MS Motosuit: Marketing Audit
PAST DEMAND AND PAST SUPPLY GAP
TABLE 17
PAST DEMAND AND SUPPLY
YEARPAST DEMAND
(# of motorcycle)
PAST SUPPLY(# of
motorcycle)
MARKET GAP(# of
motorcycle)
% MARKET GAP
(# of motorcycle)
2005 465,725 399,516 66,208 14.222006 491,339 421,490 69,850 14.222007 518,363 444,672 73,691 14.222008 546,873 469,129 77,744 14.222009 576,951 422,488 154,463 26.77
FIGURE 4
PAST DEMAND AND SUPPLY GRAPH
31MS Motosuit: Marketing Audit
PAST DEMAND AND SUPPLY ANALYSIS
32MS Motosuit: Marketing Audit
PROJECTED DEMAND AND PROJECTED SUPPLY GAP
TABLE 18
PROJECTED DEMAND AND SUPPLY
YEARPROJECTED DEMAND
PROJECTED SUPPLY
MARKET GAP
% MARKET GAP
2010 608,683 429,415 179,268 29.452011 642,161 436,455 205,706 32.032012 677,480 443,611 233,869 34.522013 714,741 450,884 263,857 36.922014 754,052 458,276 295,775 39.22
FIGURE 5
PROJECTED DEMAND AND SUPPLY GRAPH
33MS Motosuit: Marketing Audit
PROJECTED DEMAND AND SUPPLY GAP ANALYSIS
34MS Motosuit: Marketing Audit
TABLE 19
2009 MARKET SHARE
NAME OF COMAPNY
ANNUAL DEMAND (# of
motorcycles)
ANNUAL SUPPLY (# of
motorcycles)
MARKET SHARE
MS MOTOSUIT
576,951 39,000 6.76
RIDE IT FOREVER
576,951 18,199 3.15
OZ RACING 576,951 18,199 3.15CHARLES RACING
576,951 9,100 1.58
MARKET GAP 576,951 154,463 26.77OTHERS 576,951 492,453 85.35
FIGURE 6
2009 MARKET SHARE PIE CHART
35MS Motosuit: Marketing Audit
2009 MARKET SHARE ANALYSIS
36MS Motosuit: Marketing Audit
TABLE 20
2011 MARKET SHARE
NAME OF COMAPNY
ANNUAL DEMAND (# of
motorcycles)
ANNUAL SUPPLY (# of
motorcycles)
MARKET SHARE
MS MOTOSUIT 642,161 43,408 6.76RIDE IT FOREVER
642,161 20,256 3.15
OZ RACING 642,161 20,256 3.15CHARLES RACING
642,161 10,128 1.58
MARKET GAP 642,161 205,706 32.03OTHERS 642,161 111,658 17.39
FIGURE 7
2011 MARKET SHARE PIE CHART
37MS Motosuit: Marketing Audit
2011 MARKET SHARE ANALYSIS
38MS Motosuit: Marketing Audit
39MS Motosuit: Marketing Audit
MAJOR COMPETITORS
Company name: Original Zandro Racing Corporation
or Ozracing
Address: 479 Archbishop Reyes Avenue
Cebu City Philippines 6000
Contact #: (032) 234 - 4868
Company name: Charles Racing
Address: 87-A Borromeo Street
Cebu City 6000
Contact #: (032) 235 - 4557
Company name: Ride – It Forever
Address: 77/12 Moo 16,
Tambon Tha Pha Pong district,
Ratchaburi 70110.
Contact #: (032) 268 - 5111
40MS Motosuit: Marketing Audit
LIST OF DIRECT COMPETITORS
OZracing
Ride – It Forever
Charles Racing
NXTracing
RUdesign
Monster Energy
Repsol
Brembo
DBS
Motormate
CArera
XML
Skydrive
Roadrunner
Xracing
Tarsier Graphics
Motosports
Motorstar
Motorace
Foxracing
Flowtech
LIST OF INDIRECT COMPETITORS
41MS Motosuit: Marketing Audit
Honda
Yamaha
Suzuki
Kawasaki
Skygo
Rusi
Loncin
Jianshe
Kymco
Motostar
Sunriser