Justo Eat is a bakery with experienced bakers providing all customers with undivided enthusiasm. The bakery has an array of products for the customers, from a simple mini mozzarella cheese tart to the often sought-after snow cream cakes. The bakery strives to only use the best ingredient in the market in order to make quality products as ingredient plays an important role to cooking mouth-watering scrumptious food.
When the development of bakery started growing in early on 20s, Alvin Lau flew to Singapore to learn the abilities of cooking from the set up Bread Story. After many years of training, he returned to Malaysia in the desires of using his skills to instruct fellow Malaysians the artwork of bakery besides to make a much better living. The first Justo Eat was developed in 2007 in Teluk Intan with a small quantity of employees, with the majority of the operations maintained by him. From a humble beginning in Teluk Intan, the bakery widened quickly to Bidor, Batu Gajah, and several areas in Perak. With 4 bakery and 1 bakery academy to boast in a short period of 6 years, Justo Eat has were able to achieve plenty that a lot of could only imagine.
Breaking sales greater than RM100, 000 and also having the ability to achieve break-even point in a short period of six months, MERELY TO Eat bakery is definitely intriguing. Hence, we have chosen this bakery for our research because of its remarkable marketing strategy and also the tactical management of the business. Problems that increased during the course of business and how, using sensible marketing strategies, the business managed to stay competitive on the market, each one of these would be talked about in the next pages, entirely with the discourse of the bakery industry.
2. 0 The Environment
Bread is an essential item in all homeowners of Malaysia. It really is a necessity that sells very well even in the changing times of financial turmoil. Though rice is the staple starch for most of the Malaysia inhabitants, bread still acts the Malaysia family as it is an option for breakfast because of the nutrition within bread.
The production of bakery products consists of a few vital components, primarily, glucose, and whole wheat flour. Unlike whole wheat flour, the price tag on sugar over the years has increased ever since the government commenced cutting subsidies in January 2010. This has caused a significant of 58. 6 percent from Rm1. 45 per kilogramme (Ariffin, 2012). The hike in sugars price has caused head pain in the bakery industry since sugar is a essential aspect in the development. However, on the 3rd of Feb 2012, the federal government has agreed upon a long-term sweets supply deal that would peg the sugars price of RM2. 30 for three years, stretching out from January 2012 to 2014. Hence, till then your price of glucose wouldn't normally fluctuate which is very advantageous to the business.
The value of bakery products in 2003 come to an impressive RM2 billion with an total annual expansion of RM65 million over the previous year which is expected to develop by 4% per annum to attain RM2. 9 billion in 2006 (Nordin, Simeh, and Shariff, 2008). There was also a rise in development of bakery products by 1. 39%, from 259, 800 loads in '09 2009 to 263, 400 loads in 2010 2010. The increase of creation and value of the bakery product is because of the increased use of bakery products by Malaysians because of the rising throw-away income and a faster pace of life (Shah, 2011) within the last five to seven years. In 5th July 2012, the Danish company Palsgaard declared its intend to build an emulsifier plant in Malaysia which will be completed in the first half of 2013 (Culliney, 2012). This announcement further reinforces the bakery industry of Malaysia; allowing increased efficiency of the loaf of bread production.
The rise of boutique bakery such as BreadTalk, Free Mori, or The Loaf also sparked an increased interest of the general public towards bakery products. This latest development of the bakery industry has come to the stage where the choice of buying is not merely between white and brown, but a number of factors due to the introduction of "exotic" range created by these boutique bakeries.
Despite the positive business weather for the bakery industry in Malaysia, the industry still lacks of proper baker connection or education that is required to guide and show Malaysians regarding this field (Bernama, 2011). Professional training modules need to be implemented in the united states in order to make more varieties in the bakery industry and to gain more knowledge about the field. A report released by Euromonitor implies that the retail value of most bakery products in Malaysia has increased from 651. 3 million US us dollars in 2006 to 742. 16 million US dollars in 2011. With appropriate learning environment in Malaysia for the bakery industry, the Euromonitor forecasts that the retail value of bakery product in Malaysia increase to 871. 20 million All of us us dollars in 2016.
3. 0 The Industry
Our research is dependant on a bakery store "Justo Eat", thus the bakery industry in our assignment is dependant on the bakery industry in Malaysia, but it is of the bakery industry in Kampar, Teluk Intan, and Bidor instead since these places are where in fact the bakery operates. Because the bakery is not available nationwide, hence, to include major competition such as Breadtalk or King's Confectionery which dominate the landscape would be unneeded since they do not give a direct competition to the bakery in these places. Instead, we'd be writing an examination around these areas in order to provide an improved understanding about the bakery's business situation.
The threat of new competitor in the bakery industry in Perak is suprisingly low. This is because bakery is actually a specific skill is tricky to find, therefore to contend in this industry, one must be considered a learnt baker with enough resources prior to his entry to the industry. It will also be mentioned that the bakery industry in Malaysia continues to be very new albeit it's very promising, hence there is not a well-known bakery business that could produce licensed bakers in Malaysia (Bernama, 2011). Also, the start-up capital because of this business is also pretty high, ranging from RM50, 000 to RM100, 000 for the price tag on the equipments needed for baking. These cooking machines and machineries are crucial for business since the business need to produce a large number of breads everyday. The specialized group of skills needed for the business, in conjunction with an above average cost of start-up capital, make the risk of new competitors in the market rather low.
However, the industry is not without competition. Just-To-Eat faces severe competition in places such as Teluk Intan from a local firm, "Happy Angel". The Happy Angel bakery is an established bakery in this area, thus they have extensive resources to contend. Happy Angel bakery has competed with Justo Eat by starting branches wherever they operate in the expectation of destroying Justo Eat's sales overtime till it is compelled to close down eventually. Happy Angel bakery also offers competed straight with Justo Eat using costing strategies in Teluk Intan because of the advantage it offers from economies of scale. The price battle between both of these bakeries went on for a year with Justo Eat growing as the ultimate champion, however, when Happy Angel bakery was required to move out due to the diminishing gains.
Since breads is a type of fast moving consumer goods (FMCG), there's a number of substitutes. Substitutes of loaf of bread include instant noodles which relatively cost just a little higher than bakery, yet it provides a better preference for consumers. Whole wheat bread common in all convenience store is also a substitute for bread, specifically for the health-conscious consumers due to the low degree of carbohydrates. Consequently, instant food such as "Twiggies" and "Roti Koko" that can be conveniently used are substitute products too since it is cheaper. It will also be noted that the tiny packets of "nasi lemak" making a far more filling meal for a cheaper price is also another good substitute product. These products relatively make business a great deal harder for bakeries such as Justo Eat because not the products are cheaper, they also offer far better preference than bakeries.
Bread is a product of low-involvement, therefore the bargaining ability of buyers on the market does not give a danger to the industry. The low prices of these products do not affect the customers significantly, hence the buyers only do not impose a great strain on the bakery. The true threat comes from all of the replacement products instead since not only these alternate food options provide a better taste, these products are also subject to price changes constantly. The bargaining ability of suppliers is also limited anticipated to lot of suppliers on the market. Suppliers for bakery usually supply raw materials, hence these first tiers suppliers can certainly be found in the marketplace. Various suppliers remain competitive for the large account of Justo Eat, therefore most often the power to deal prices usually show up in the hands of the bakery instead.
4. 0 Justo Eat Marketing strategies
Objective of marketing strategy
Product objectives of Justo Eat are aspire to grow and boosting the business's position on the market. Justo Eat is producing high variety of products and retaining the high quality of products to differentiate and boost itself in the market.
The goal of advertising for Justo Eat is to produce consciousness among customers and attract more customers in order to increase demand.
Pricing target of Justo Eat is market-share aim. Justo Eat seeks to increase sales and increase market show because of its products.
Justo Eat is having syndication channel objective of establishing direct sales contact with last customer to enhance networking making good romantic relationship for retaining customer.
Target market
The marketplace of Just-to-Eat is home who frequently purchase its products especially during special event of wedding and birthday celebration. Justo Eat has high coverage of marketplace because its product can be used daily and convenient to target market. The products being sold are also economically affordable to all customers with low price and full satisfied.
Competitive advantage
Justo Eat has competitive good thing about good networking using its supplier. The nice interactions with suppliers allow Justo Eat to obtain high quality of ingredients with a reasonable cost. The high quality of element will further ensure the product quality. In addition, good marriage with suppliers can help avoid lack of ingredients. Second of all, Justo Eat positioned as assured high quality of products which can provide as an instrument to hold on to customers and bring positive word-of-mouth.
Product
The top sales product of Justo Eat is bun. Justo Eat bakery provides newly prepared bakery buns all the time to ensure fresh baked goods are always available. As a result, fresh and high quality buns produced effectively attracting a great deal of customer for repeated purchase. Buns such as hawaii pizza, hot dog hen floss and garlic cheese are creating more sales compare with other bakery products such as cakes.
Product line development is most beneficial to identified Justo Eat product strategy. To be able to expand the marketplace and raise market share, Justo Eat thought that with wide variety of loaf of bread and cakes, different taste of customers can be customized. In general, it also helps to retain the faithful customer by fulfilling their needs through providing a multitude of bread with good quality, progressive and creative design. For example, Justo Eat hauling variety of products such as fresh cream cakes in mozzarella cheese series, delicious chocolate and caffeine series, fruit series, ice-cream series. Furthermore, Justo Eat also unveiled a product range for festivity series such as toon series, numbering, wedding and indulge, and fullmoon series ( Justo Eat bakery, 2011).
Promotion mix
On every new starting of branch, Justo Eat rely on banner advertising to seize customer attention. The orange colour of banner can actually brings Justo Eat an individuality.
Banner is not the only method in advertising the bakery shop, Justo Eat also use brochure. Creative brochure with some important information about company are allocated. Brochures is a low cost advertising method that used by company to build awareness of company to target market.
With good reputation, Justo Eat enable to create postive word-of-mouth among the client. Satisfied customers will propagate the positive comment and information about company with their acquaintances and peer organizations when they are content with the merchandise purchased. This word-of-mouth works well and reliable in free advertising.
Pricing
The price range placed by Justo Eat for buns is RM1. 20 to RM3. 60, tart is RM2. 20 and each slice of wedding cake is ranged RM3. 20 to RM4. 50 while 1kg cakes is in price range of RM28 to RM40. In bakery industry, price warfare is inescapable, price environment of Justo Eat is relatively lower than competitors. That is useful for immediate market acceptance and maximum sales when come to time for intense competition with other bakery. Competition of Justo Eat, Happy Angel Wedding cake House establish 1kg of cakes in price range of RM30-RM45 which greater than Justo Eat. (Happy Angel, 2010)
A powerful pricing tactics used by Justo Eat, RM 1 price marketing promotions for everyone breads. Obviously, this is aiming to boost the sales and market share by appealing to new customer. Nonetheless, the key edge Justo Eat can gain from this price promotion is conquering down its competition. The lauching of RM1 per bakery promotion is sustained for nine a few months in order to gain high revenue and produced high market show. Competitors had been killed by Justo Eat in this critical period.
Place
Justo Eat is using direct market channel to attain the market. Justo Eat advertising products only in their bakery shop. Justo Eat presumed that direct contact with customer is the simplest way to satisfy them.
Justo Eat also spread products to some entertainment shop and campus cafeteria. However, this only functions as a promotional strategies to reach more potential customer to put on Justo Eat breads. As Justo Eat maintain that the using of intermediate route will not earn much profit to them.
Justo Eat also asked Taiwanese for demostratation in its outlets to draw in customers and grab chance to learn and improve skills from them. Place strategy that using by Justo Eat is yank strategy that involves a massive word-of- mouth to make demand for product that pulls the consumer to get for it. Pull strategy can easily gather customer feedback on ways bettering products. This strategy also can create popular of products very quickly especially during the period of new open bakery branch.
5. 0 Justo Eat troubles and its course of action
Despite Justo Eat's success, every business surely must face some problems and challenges among the industry. The development of the business will lead Justo Eat facing the cheapest point of the career with the poorest sale performance scheduled to breads is not the primary course for folks lifestyle especially Malaysian. Folks have other choices of foods such as noodle or grain. In addition, Justo Eat is small in size and the shop acceptance is not popular in Malaysia compare to those famous bakeries such as "Bread Story". Thus, however the sales is high at the beginning stage, yet the sales drop for a certain period when consumers no more feel fresh with the bakery. This is a common trend for everyone businesses. The fell sales induced Justo Eat to rethink its strategy in order to carry the huge business expenditures. Being a store with low revenue still need to pay for rental, normal water and electric charge, and employee pay. This kept a crucial question for Justo Eat to maintain the business at this short-term trough pattern.
To maintain and even enhance the business through the trough point of the craze, Justo Eat expand the business enterprise by opening more branches in other area. The brand new branches can acquire more customers to get more sales and eventually increase the popularity of Justo Eat. By doing this, the profitable branch can make up the low sales branch. Instead of handled by the craze, Justo Eat take effort to wide open bakery academy which provide bakery course. The lessons include one day self-interest DIY baking category, specialist certificate course, and professional diploma in cooking and confectionery. Different courses acquired fulfill different university student must learn a bakery skill. In addition, it brings revenue to Justo Eat. The students who signed up with the training in the first time of the commercement of bakery academy can enjoy the top priority for partnering with Justo Eat to start own bakery business. Using this method, Justo Eat presumed that their endeavor can be sustained despite the slow pattern at certain period.
In order to keep the bakery and wedding cake business during the slow style, Justo Eat put more work in guaranteeing the performance at store level. The management stresses in sanitation and hygiene of the shop. This helps the company to earn some credits for the operating environment. It will impact perceive value of consumer, and then it will have an impact on consumer's purchasing decision making. Furthermore, the quality of product never been neglected and the best service is provided for customer. To determine employee morale by doing this, Justo Eat management acquired built up a specific pay back performance system culture among the worker. Justo Eat only retain those staff with ability and good working attitude. Moreover, monthly meeting performed in headquarter with the entire branch manager is essential to understand every branch situation and presenting opinion to enhance the management team. During the assembly will discuss the condition facing and solution in different branch. Therefore Justo Eat can ensure the worker supply the customer with best service to increase customer satisfaction so that positive word-of-mouth can be established among the customers. With this, customers are prepared recommend the bakery to others.
When considering a company, location is often an extremely critical factor to be looked at. The typical advice "location, location, location" is directly on the make for a business. The exact same is to Justo Eat, the location plays a key point that lead to the firm success. Justo Eat bakery has the fifth branch in sitiawan early in the entire year of 2009. The opening of this branch had increase the bakery industry in sitiawan at the early stage. Justo Eat possessed ripped off many the market talk about from the competition in that particular area. The shop was perceived to be placed at a good location as it located at the key streets in Sitiawan and it was located beside The Store supermarket. Primarily, Justo Eat thought that the subjection and the knowing of Justo Eat can be exploited in the Store as the bakery shop is viewable from Store. Thus, the customer surely can notice and recognise the shop. Nonetheless, the shop location is thought to have satisfied number of pedestrian.
However, couple of months later, the sales possessed dropped enormously. Justo Eat overlooked the appeal of the location. Although there is many customer patronage The Store, but they are not assured to go to the bakery shop. What's more? Justo Eat overestimated the pedestrian traffic at the particular place. A business should ensure that the area is usually to be guaranteed to have pedestrian about the shop location from time to time. There is lack of pedestrian throughout the bakery shop, or can be inferred that during day time, there isn't much pedestrian along the street. Therefore, in the end, Justo Eat made a decision to milk this branch to avoid further loss. Fortunately, the company's sales from the first period will do to pay the later level loss, thus the company able to cover the initial start-up cost and some other operating expenditures.
The location problem not only existed in Sitiawan, the bakery branch in Kampar also encountered location problem but it derived from another aspect. The increasing population in Kampar is really a good factor which can determine business to come in. The amount of student no matter in TAR College or UTAR is increasing, the business can exploit this chance to gain market show in Kampar. With the starting, the students are also enticed by the RM1 bread campaign, Justo Eat got also achieved high sales at this stage. However, Justo eat didn't anticipate the pupil study period. Students from both college or university and universiti will have a 3-week of semester break after final exam. During this time period, they will not been in Kampar, therefore, there will be very low sales throughout that particular month.
During the semester respite month, Justo Eat can only just count on the sales from household in Kampar. Unfortunately, the positioning of the bakery shop only assists as a convenient place for the pupil in Kampar however, not for the resident in Kampar. After few semester of lost, Justo Eat decided to milk this branch. Although the location is not well suited for providing their product, the store is remained and turns into a bakery academy. The thought of bakery academy is not merely for solving the condition in Kampar, it is a new strategy formulated by Justo Eat for future enlargement as mentioned above. Since Justo Eat was looking for store space for bakery lessons, while the bakery shop location is suitable for starting bakery academy, Justo Eat consequently exploit the store space in Kampar to open up their first bakery academy. Using this method, Justo Eat can eventually reduce the cost in general market trends and store restoration in Kampar.
6. 0 Suggested alternative programs of action and its implementation
To take part in business in a good location is essential to attain visibility in the short-term and to gain profit in long haul as agreed by every businessperson and businessman. However, by depending solely one's own "sixth sense" which is considered as an entrepreneur's alertness, is not always reliable. Therefore, it is advisable to conduct an intensive survey and examination before entering market and location. This assists a company to better understand what the attraction in that particular area or location is, how to attract potential focus on customers and who its competitors are. Justo Eat, a family-style bakery shop, should create a small marketing team in which they gather useful information, evaluate the new shop locations and strategies as well as carry out simple studies in a particular location to ensure there's a high chance of being able to focus on its customers. The founder and brains behind Justo Eat is an effective entrepreneur who possessed depended on his business acuity to effectively analyze the actual success of a spot for a new shop, but there are also some unforeseen mistakes which 's the reason the small marketing team. The marketing team will be able to assist him by delving deeper into his view and help him explore his ideas by using study and evaluation research from his marketing division.
Tea break is an increasing craze in Malaysia among youths, young adults and oldies, where they'll spare some time for a brief break no subject how busy they are really. To seize this gold opportunity, Justo Eat will include different kinds of drinks in their outlets and chair and desks where customers can simply enjoy a mixture of bread and caffeine, and think of Justo Eat when they would like to have a tea respite. Other than that, the company can also increase the quality of the wedding cake by providing training for its employees. This is because of the poor focus on cakes, alternatively than bread from the company. When compared to the breads, the sales of cake of the business are not always on focus on. Because of this, improving in the grade of their cakes may be an edge to the company, to an degree, improving its sales and income. The customers can not only have bread but also enjoy wedding cake during tea time in any Justo Eat shop. Although this will be another operating cost to the business as the company has to raise the amount of employees, in the long-term, the business can increase its revenue and focus on another new opportunity, enhancing the patronage of customers. This will be its competitive advantages in the bakery industry, as opposed to being just limited to only selling bakery and pastries.
The overall marketing strategy employed by Justo Eat targets the family-based market segments. Families often go to bakeries to buy different breads for their children's breakfast, for them to bring to school or help as the lunch time for the men and women. However, there's also unmarried individuals and youths, who favor more variety in their lives. All of the choice in Justo Eat is bound and after some time, the sole individuals and youths will start to feel weary due to the lack of new variety. When it comes to this, Justo Eat can execute a 'Weekly Special' program, where they create new breads to spice things up. This will encourage them to patronize the store at least one time a week, using the regular special breads to get them, that will boost sales and allow differentiation among the other bakeries in the region.
7. 0 Conclusion
Justo Eat has good ways of overcome the company problem, and it also has a complete management system for the daily procedure. Throughout its five many years of life, Justo Eat has developed the organization with an increase of and even more branch. Developing the business experienced created the well-known reputation of company.
However, regardless of the successful plan and development of company, the future of Justo Eat is challenging. The major concern is competition on the list of industry. The company don't have brand strategy that customer can distinguish the business product when contend with others. It does not have a unique product that able to impress the company brand. In other words, there are no products that can makes customer to recall Justo Eat when they think of breads or cakes. Second, culture and eating habit for the Malaysian when having the primary course. Consumer might not eat a loaf of bread or cake because of their your meal nonetheless they will have noodles or grain. Breads and cakes will never be their only choice when considering a meal. Moreover, the society is moving towards balanced diet habit. This creates a concern for Justo Eat in taking into consideration the ingredients used in cakes and breads cooking.
In order to help make the first decade, Justo Eat has developed the business enterprise by opening bakery academy. It isn't simply for increasing the earnings but also serve as an opportunity for future expansion. The graduation prospects from Justo Eat can partner with the company to open branch in other location. Therefore, company can have a writing of the business enterprise risk with others and expands the business at the same time. In addition, it helps the company to be well-known as the students will probably distributed their experience to others.
Upon the enterprise of Justo Eat, it can't be denied that the observation of the market and a strong network relationship can really affect an effective business thoroughly. A whole and appropriate management system is vital for daily procedure. Still, it is vital how a person can implicate the knowledge or understanding how to the enterprise.
