Project Feasibility Study on Sambong Powder

Deparment of Business and Management

College of Management and Economics

Visayas State University

Visca Baybay City, Leyte

A Project Feasibility Study

In Partial Fulfillment of the Requirements for MGMT 145

Introduction of Project Feasibility Study

Submitted By:

Banquicio, Cherry Joy S.

Cabasisi, Cristine C.

Circulado, Valerie D.

Lowangco, Nello N.

Oquias, Gladys B.

Pasa, Elizabeth D.

Rapas, Bryan N.

Valeroso, Dindo M.

Vano, Virly Mae M.

Veril, Rannie B.

Market Aspect

Market Analysis

Sambong Powder is made from 100% fresh sambong leaves. Sambong Powder

possesses the attributes and properties of being a natural and pure herbal supplement.

Sambong Powder has a light brown property in its color than any other to remain its

pure organic content and to remain the taste of natural boiled sambong leaves. It has

fine powdery texture that will be easily dissolved in water. The organization limits the

weight of the product in 2g in each pack, in order to be affordable and for uniformity

purposes. Its individual packaging is made of stick like acetate and was pack in dozen,

with a brand name together with the manufacturer of product place in a small printed

unconventional paper. The Sambong powder is twenty pesos (Php20) per pack which is

very affordable to the masses.

Sambong powder has various benefits. Due to its blood cleansing property it is

commonly used to treat hypertension and mild to moderate congestive heart failure. It

works as a diuretic, which means that it removes excess fluid and sodium from the body

through urine. It is because excess sodium in the system is known to contribute high

blood pressure, diuretic used to alleviate the condition. It is also good for people with

urinary track infections, kidney disorders, and family history having kidney stones/

kidney diseases. Sambong is one of the herbal medicines approved by the Philippine

Department of Health (DOH) as an alternative medicine in tracking particular disorders.

This plant possesses a multitude of properties that make it worthy of the DOH approval.

Majority (60%) of the respondents believed that the flavor is the most important

factor in buying the sambong powder followed by its apperance (41%) then the color

(35%) and its texture (34%). Therefore, if the product is made deficient in its attributes

(44%) of the respondents are unhappy. On the other hand if the attributes were superior

(45%) of the respondents are satisfied. On product awareness, most of the respondents

are not aware (95%) of the existence of sambong powder and the rest (5%) are aware

of the product. The ninety-seven percent (97%) of the respondents are willing to buy the

product and there are 3% that’s not willing to buy.

Market and Market Sizing

The target market of this product are mostly adult with an average age 40 years

old. Most of the adults were very conscious of their health condition and they always

check the contents of what they intake. Since this is a herbal supplement product, it will

be attractive to them given that it has many benefits for the body. The powdery feature

of the product can also caught attention to the adult respondents given that it is new and

was modified innovatively and easy for them to prepare.

Potential Market Demand

PMD= # of potential buyers * % willing to buy

*average qty. Bought.*substitution rate

PMD= 107,306 x 0.97 x 1 pack x 0.237

= 24, 669 packs per year

PMD= 2,466,858 / 12 months

= 2, 056 packs per month

PMD= 2,466,858 / 30 days

= 69 packs per day

The population of the area from age ranges 25-50 is 107,306 which is the

potential buyer of the product. It was multiplied by the 97% willingness to buy then to

the 1 pack/day which is the average consumption of people per day and was multipied

by the substitution rate (23.7%) which results to potential market demand of 2, 056

packs monthly, 69 packs daily and 24, 669 packs annually. Therefore, there is a big

chance Sambong Powder will boom if it will be available in the community most

especially in every barangay.

Competitor Analysis

Sambong Powder, was created by an organization POFERA (Pancil Organization for

Ecological Rehabilitation Association) located in Brgy. Pancil, Malitbog, Southern Leyte.

Sambong Powder has several herbal product competitors such as; salabat, mais, lagundi,

malunggay powder and many other. Based on the data gathered, the product has a wide

competition therefore, in order to compete with their several competitors and able to gain market

share. Majority of the respondent (60%) were conscious about the flavor they want a natural

herbal product just the extract of sambong leaves and no more sugar. Generally, thirty percent

(30%) of the respondents were conscious about the product appearance, as packaging and

label concern, product itself must properly packed with thick plastic to make it presentable as for

the label it must contain all the information needed such as contact number, the place the

product was manufactured, also the product benefits and ingredients. It should have a good

promotional strategy in order for the product to be recognize in the market.

Demand- Supply Analysis

POFERA manufacturer presently produces 296 packs of sambong product per

month a total of 3,552 packs per year.The demand of the product in the market per year

is 24, 669 packs. The total demand- supply gap of the sambong powder is 21, 117

which is the difference of 24, 669 packs demanded per year and 3,552 packs presently

produce by POFERA manufacturer per year.

Market Strategies

Product

Sambong Powder is a herbal product extracted from sambong leaves added with

sugar. Its brown in color, very fine textured and has an aromatic smell that anyone

couldn’t resist. The product is packed in a plain plastic and each pack contains twelve

pieces, grams packed sambong powder.

Most of the respondents of Southern Leyte suggests to improve the product

packaging. They wanted that the cellophane used for packaging will be thicker and

place it in a tea bag just like Green Teas’ design. They have little concern on product’s

texture. But majority of the respondents expressed contentment with the attributes of

the exixting sambong powder.

Price

Sambong Powder will be offered at an affordable price. The product will be sold

at 20 pesos per pack. Its price is lesser compared to other commercial herbal products

sold in the market because of its natural content that has lower costs but gives bulk

healthy benefits.

Majority of the respondents are price sensitive. But they are mostly contented

with the original price of the product (Php20.00). When the product’s price is at

Php20.00, 96% of the respondents are willing to buy the product. However if the price

will increase the willingness of the respondents to buy the product decreases. On the

other hand, 46% of the respondents suggested to lower the price to Php15.00 cause its

more affordable for the them.

Place

The availability of the product is very important to the respondents. The product

will be place in different market place in the neighboring municipalities for easy

distribution of the product to the customers. The product must also be distributed

through various retailers for accessibity purposes.

Most of the respondents (46%), suggested that there will be an outlet available

so that consumer can easily buy the product, so that costumer will know where to buy

and find the product easily . And 19% wanted to have direct selling.

Promotion

The product will be promoted by aggressive and strong promotional and

marketing strategy like introducing the new product, informing the public about it, and

conduct pre-testing of the product so that the product could penetrate the market

despite of its various competitors. Free product tasting and sampling to the residents of

various areas will be conducted in order for the consumer to be more familiar about the

product and determine their product feedbacks. Promotion of the products must include

posters, flyers and tarpaulins. Direct selling is also suggested for better information of

the product and targeted market will be achieved. Using these promotional expense, the

business will need an annual budget of Php per year to promote the product.

Table 1. Promotional Tools and Budget (Annual).

Promotional Tools Budget (Php)

1. Poster 400

2. Flyer 1,776

3. Tarpaulin 540

TOTAL 2,716

Mostly of the respondents (65%), don’t have comment about promotional

strategy for the product and 19% wanted to have free testing of the product so that

consumer can evaluate the taste of the product because most of the respondents are

more concern of the flavor of the product. And most importantly, the quantity of the

product that the consumer buy depends on the taste of Sambong powder.

APPENDICES

Appendix 1. Market Survey Results and Discussion

Distribution of the Respondents

The one hundred respondents were interviewed from Southern Leyte. For the

study, they were interviewed randomly with twenty-five respondents in each municipality

(Sogod, Bontoc, Tomas Oppus and Malitbog).

Profile of the Respondents

The data gathered shows that most of the respondents are female (77%) and the

rest are male (23%). Mostly of the respondents (79%) are married, 15% are single and

6% are widow or widower. In terms of educational attainment, most of the respondents

reached high school (high school graduate 27% and high school level 24%), and the

24% reached college level (college graduate 11% and 13% college undergradruate)

and the remaining 25% reached elementary level. For the respondents’ occupation,

majority of the respondents are unemployed (55%), 32% are self-employed or have

their own business, 9% are government employee and the remaining 4% are private

employee.

Appendix Table 1. Demographic Profile of Respondents in Southern Leyte.

Demographic Characteristics Frequency

Gender

Male 23

Female 77

Total 100

Civil Status

Single 15

Married 79

Widow/Widower 6

Total 100

Educational Attainment

Elementary Level 25

High School Level 24

High School Graduate 27

College Level 13

College Graduate 11

Total 100

Occupation

Government Employee 9

Private Employee 4

Self-employed 32

Unemployed 55

Total 100

Product Awareness

Awareness Level

The table implicates that majority of the respondents (95%) were not aware of

the existence of Sambong Product and the rest (5%) were otherwise aware of the

product.

Appendix Table 2. Respondent’s Level of Awareness of Sambong Powder.

Awareness Level Frequency

Yes 5

No 95

Total 100

Ninety seven percent (97%) of the respondents were willing to buy Sambong

Powder and 3% were not willing to buy.

Appendix Table 3. Respondent’s Willing to Buy Sambong Powder.

Percentage Willingness To Buy Frequency

Willing 97

Not willing 3

Total 100

The table shows that out of one hundred respondents, 5% are willing to buy but

only one of them who buy the Sambong powder.

Appendix Table 4. Percentage of respondents who buy the product.

Buy the Product Frequency % Response

Yes 1 20

No 4 80

Total 5 100

The table shows that majority of respondent’s reasons for not buying Sambong

powder due to unavailability (75%) in the market. Moreover, 25%of them don’t prefer

the taste.

Appendix Table 5. Respondent’s Reason for not buying Sambong Powder in Southern

Leyte.

Demographic Characteristics Frequency % Response

Unavailability 3 75

Taste 1 25

Total 4 100

The table shows that 18% of the respondents used similar products that were

considered as substitute of sambong powder.

Appendix Table 6. Percentage of Respondents take Similar Products.

Take Similar Products Frequency % Response

Yes 18 18

No 82 82

Total 100 100

In respect of buying similar products, majority of the respondents (33%) take

salabat, 28% used fresh leave of either guava or sambong and 33% used mais, lagundi

and malunggay powder and the remaining 6% take karabo as their herbal product.

Appendix Table 7. Repondent’s preference of buying similar herbal products in

Southern Leyte.

Demographic Characteristics Frequency % Response

Fresh leaf (guava & sambong) 5 28

Salabat 6 33

Mais 2 11

Lagundi 2 11

Malunggay (powder/liquid) 2 11

Karabo 1 6

Total 18 100

In terms of how often respondents buy the similar products, majority of them

(78%) buy similar products every once a week, 10% buy twice a month and the

remaining 12 % purchase once in two weeks (6%) and twice a day (6%).

Appendix Table 8. Respondents buying frequency of similar herbal products in Southern

Leyte.

Frequency in Buyring similar Products Frequency % Response

Once in two weeks 1 6

Once a week 14 78

Twice a day 1 6

Twice in a month 2 10

Total 18 100

The table shows the percentage of respondents who buy the sambong powder.

Most of the respondents (98%) don’t buy sambong powder and the remaining 2% buy

the product.

Appendix Table 8. Percent of respondents buy Sambong Powder

Buy the Product Frequency % Response

Yes 2 2

No 98 98

Total 100 100

Product Usage

Product usage is gathered in order to know how much packs to produce in

accordance with the demand.

Out of the 100 respondents only 2 of them consumed the product. The last time

they consumed the product was last week and more than a month ago.

Appendix Table 9. Recent date consumed of Sambong Powder.

Recent Date Consumed Frequency % Response

Last week 1 50

More than a month ago 1 50

Total 2 100

The table shows how long does the repondents using the sambong powder. The

respondents take the product more than a month ago and more than a week ago.

Appendix Table 10. Length of time in consuming Sambong Powder

Time Frequency % Response

More than a week 1 50

More than a month 1 50

Total 2 100

The table indicated that the respondents who buy the sambong powder were

only influenced by their friends.

Appendix Table 11. People influence the respondents to buy Sambong Powder.

Influencer Frequency % Response

Friends 2 100

Total 2 100

This table shows the reasons why respondents consumed or buy the product.

They used the product because of its good taste (50%) and high nutritional value (50%).

Appendix Table 12. Reasons in consuming Sambong powder.

Reasons Frequency % Response

Good Taste 1 50

High Nutritional Value 1 50

Total 2 100

Purchased data

Respondents prefer to buy sambong powder from their neighbor (50%) and the

main manufacturer (50%).

Appendix Table 13. Respondents preferred areas in buying Sambong Powder

Place Frequency % Response

Neighbor 1 50

Main manufacturer 1 50

Total 2 100

Product Attributes Rating

The product was evaluated through assigning rates to each of the selected

attributes on the level of importance. The rates use were: 1 for the extremely important,

2 for the moderately important, 3 for neither important nor unimportant, 4 for the

moderately unimportant and 5 for extremely unimportant.

The table shows that among all the attributes, flavor of the product was extremely

important (60%). In addition, appearance and general acceptability of the product were

moderately important (30%). Neither important and unimportant (11%) to the consumer

was texture. Moreover, color was extremely unimportant attributes of the product.

Appendix Table 14. Product attributes of Sambong Powder

Attributes

Rating Color Appearance Texture FlavorGeneral

Acceptability

Extremely Important 35 41 34 60 46

Moderately Important 29 31 30 30 31

Neither

important/unimportant6 2 11 10 10

Moderately unimportant 7 6 5 0 5

Extemely unimportant 23 20 20 0 13

Majority of the respondents were unsatisfied if all attributes which includes the

color, appearance, texture, flavor and general acceptability of the product are deficient.

Appendix Table 15. Repondents views if one of the attributes is deficient.

Deficient Attributes (%)

Rating Color Appearance Texture FlavorGeneral

Acceptability

Satisfied 26 24 28 20 27

Unsatisfied 55 58 51 68 44

No Comment 19 18 21 12 29

It was stated in this table that the greatest percentage (45%) of the respondents

were happy if the color of the product is superior. And 41% of the respondents has no

response about the product.

Appendix Table 16. Respondents response when the product has superiority in color.

Color Frequency % Response

Happy45 45

Suppose to be present14 14

No Response41 41

Total 100 100

In this table it was indicated that 41% of the respondents has no response about

the product. And 23% suggested to the appearance of the product that supposed to be

present.

Appendix Table 17. Respondents response if the appearance of the product is superior.

Appearance Frequency % Response

Happy36 36


No Response41 41

Total100 100

It was indicated in this table that most (45%) of the respondents has no response

of the product when the texture is superior. However, 38% of the respondents were

happy if texture of the product is superior.

Appendix Table 18. Respondents response if the texture of the product is superior.

Texture Frequency % Response

Happy38 38


No Response45 45

Total100 100

It was stated stated in this table that 38% of the respondents has no response

and 37% of the respondents were happy if the flavor is superior.

Appendix Table 19. Respondents response if the flavor of the product is superior.

Flavor Frequency % Response

Happy37 37


No Response38 38

Total100 100

Majority of the respondents (53%) has no response when the general

acceptability of the product is superior. However, 21% of the respondents were happy

of the appearance of the product.

Appendix Table 20. Respondents response if the general acceptability of the product is

superior.

General Acceptability Frequency % Response

Happy21 21


No Response53 53

Total100 100

Price Sensitivity Analysis

The original price of the product was Php 20.00 per pack. About 96% of the

respondents are willing to buy the product and only 4% were unwilling.

Appendix Table 21. Wilingness of the respondents to buy if the price is at Php 15.00

Willingness Frequency % Response

Yes 96 96

No 4 4

Total 100 100

When the original price of the product was at Php20.00, the average quantity that

the respondents are willing to buy was 1.38.

Appendix Table 22. Quantities that the respondents are willing to buy at Php15.00.

Quantity

Average Value

1.38

The table showed the information about willingnes of the consumer when the

price per pack was increased to Php25.00. However, there were 52% of the

respondents were not willing to buy while 48% of the respondents were still willing to

buy the product.



Yes48 48

No52 52

Total100 100

When the price of the product was set at Php 25.00 per pack, the average

quantity that the respondents are willing to buy was 1.48.


Quantity

Average Value

1.48

The table showed that there were only 22% of the respondents that are willing

while majority (78%) of the respondents were not willing to buy the product if the price is

at Php30.00 per pack.



Yes22 22

No78 78

Total100 100

When the price was set at Php30.00 per pack, the average number of quantity

that the consumers are willing to buy was 1.27.


Quantity

Average Value

1.27

The table showed that when the price is set at Php35.00 per pack, there were

only 19% of the respondents are willing to buy while most of the respondents (81%)

were not willing to buy.



Yes 19 19

No 81 81

Total 100 100

When the price was set at Php35.00 per pack, the average number of quantity

that the consumers are willing to buy was 1.05.


Quantity

Average Value

1.05

Other comments and suggestion

Substitution Rate

Majority of the respondents (67%) were willing to have Sambong Powder as

substitute of the herbal product they intake.

Appendices Table 29. Percentage of the respondents willing to substitute Sambong

Powder.

Willing to Substitute Sambong Powder Frequency % Response

Yes 67 67

No 33 33

Total 100 100

Suggestion of the product

Majority of the respondents (57%) were contented of what product is. In addition,

40% suggested that the product must improve the packaging.

Appendix Table 30. Suggestion for Sambong Powder product.

Suggestion Frequency % Response

Improve packaging 40 40

Improve texture 3 3

No suggestion 57 57

Total 100 100

Suggestion of the price

Majority of the respondents (54%) agreed the original price which is Php20.00.

Apparently, 46% of the respondents suggested to lower the price to Php15.00.

Appendix Table 31. Suggestion for Sambong Powder price.


15 46 46

20 54 54

Total 100 100

Suggestion of the promotion

Majority of the respondents (65%) were contented the way the supplier promote

their products and 18% of the respondents suggested also to have a free taste.

Appendix Table 32. Suggestion for Sambong Powder promotion.


Free tasting 18 18

TV and Radio advertisement 9 9

Fliers 6 6

Posters 1 1

Seminar 1 1

No comment 65 65

Total 100 100

Suggestion of the place of distribution

Majority of the respondents (46%) suggested to have an outlet. However, 34%

percent were contented and 19% suggested to have direct selling.

Appendix Table 33. Suggestion for Sambong Powder promotion.


Grocery 1 1

Direct Selling 19 19

Outlet 46 46

No comment 34 34

Total 100 100