Choufont-Salva Choufont-Salva Inc.Inc.

Case Analysis – Marketing Group 5

PESTLED AnalysisPESTLED AnalysisMacro-environment FactorsMacro-environment Factors

• Government promoting Government promoting family planning services.family planning services.

• Subsidizing substitute Subsidizing substitute product (I.U.D)product (I.U.D)

• Two third of population are Two third of population are low income peoplelow income people

• Large gap between cities Large gap between cities and rural areas.and rural areas.

• Family planning is gaining Family planning is gaining awareness with supporting from awareness with supporting from groups and associations (FPAP, groups and associations (FPAP, PPMP, RPA, etc)PPMP, RPA, etc)

• More women want to learn about More women want to learn about birth control. 32.5% already birth control. 32.5% already know about family limitation.know about family limitation.

• Catholic church start to allow Catholic church start to allow using birth controlling methodsusing birth controlling methods

• Technology in medicine Technology in medicine industry increasing due to industry increasing due to MNC companies join the MNC companies join the market.market.

• Better products are Better products are expected in short future.expected in short future.

• Low restrictive drug lawsLow restrictive drug laws

• Has law on controlling Has law on controlling advertising activities, but advertising activities, but being ignored.being ignored.

• High level of population High level of population densitydensity

• Shortage in food supplyShortage in food supply

• High population and density (over High population and density (over 63 million in 1991)63 million in 1991)

• Highly grow rate: 2.4%/yearHighly grow rate: 2.4%/year

• 85% stay in rural areas.85% stay in rural areas.

• Women between 20-45: ~11 millionWomen between 20-45: ~11 million

• ~60% of women between 15-45 are ~60% of women between 15-45 are married.married.

• Roman Catholic is the main Roman Catholic is the main religious with 84% of total.religious with 84% of total.

• Low education standard: ~80% of Low education standard: ~80% of women have intermediate and women have intermediate and lower level.lower level.

Porters’ 5 Forces ModelPorters’ 5 Forces Model

Bargaining Power of Suppliers

A. L. Choufont et Fils, S.A

Bargaining Power of Suppliers

A. L. Choufont et Fils, S.A

Bargaining Power of Buyers• Drug outlets: 75%• Family clinics: 25%• Doctors, physicians: 5%

Bargaining Power of Buyers• Drug outlets: 75%• Family clinics: 25%• Doctors, physicians: 5%

Rivalry• Brand A: 35%• Brand B: 17%• Brand C: 10%• Brand D: 8%• Brand E: 5%• Others: 20%

Rivalry• Brand A: 35%• Brand B: 17%• Brand C: 10%• Brand D: 8%• Brand E: 5%• Others: 20%

New Entry• High cost, long time• Other MNC

New Entry• High cost, long time• Other MNC

Substition• I.D.U• Other methods

Substition• I.D.U• Other methods

LOWLOW HIGHHIGH HIGHHIGH

MEDIUMMEDIUM

HIGHHIGH

• Heavy financial investment Heavy financial investment requiredrequired

• Long time to develop and Long time to develop and market productsmarket products

• High threats from other MNC High threats from other MNC companies enter the marketcompanies enter the market

• Highly competition levelHighly competition level

• 5 out of 15 brands control 75% of 5 out of 15 brands control 75% of marketmarket

• Competitors offer wide range of Competitors offer wide range of products from low price to products from low price to premiumpremium

Brand % Market share Price Distribution channel

A 35 Low Drug outlets

B 17 Low Family planning centers

C 10 Medium -

D 8 Medium -

E 5 High -

• Supplier: A. L. Choufont et Fils, Supplier: A. L. Choufont et Fils, S.A.S.A.

• Choufont-Salva relies on its Choufont-Salva relies on its parent company for supplyparent company for supply

• Low threat from parent Low threat from parent companycompany

• Main buyers: Main buyers: – Drug outlets: 75%Drug outlets: 75%– Government and private clinics: 25%Government and private clinics: 25%– Doctors, physicians: 5%Doctors, physicians: 5%

• Switching cost is lowSwitching cost is low

• Buy in large volumeBuy in large volume

• Buyers have high bargaining Buyers have high bargaining powerpower

• I.U.D I.U.D (Intrauternine Contraceptive (Intrauternine Contraceptive Device)Device)

– Highly promoted by governmentHighly promoted by government– High threatsHigh threats

• Other birth control methods Other birth control methods – Condom, Diaphragms, Condom, Diaphragms,

Spermicidal Jellies, CreamsSpermicidal Jellies, Creams– Low threatsLow threats

SWOT AnalysisSWOT AnalysisInternal FactorsInternal Factors

• Better productBetter product

• Lower production costLower production cost

• Good company imageGood company image

• Good relationships with B2B Good relationships with B2B distributorsdistributors

• High skill sales High skill sales representativesrepresentatives

• Lacking of mass Lacking of mass communication knowledge communication knowledge

• Maintain close relationships Maintain close relationships with only 25% of doctors and with only 25% of doctors and 30% of drug stores.30% of drug stores.

• Do not have enough Do not have enough benchmarking information on benchmarking information on product in other markets.product in other markets.

• Neglect of marketing research. Neglect of marketing research. Fail to realize the important of Fail to realize the important of the primary data and market the primary data and market test.test.

• Sell what company has, not Sell what company has, not what people wantwhat people want

• Highly growth market: 50% Highly growth market: 50% per year for next 3 yearsper year for next 3 years

• Competitors products take 9-Competitors products take 9-12 month to launch.12 month to launch.

• Can get supporting from FPAPCan get supporting from FPAP

• Less restriction from Catholic Less restriction from Catholic churchchurch

• Better products from Better products from competitors coming sooncompetitors coming soon

• Substitute solution is cheaper Substitute solution is cheaper and being support by and being support by governments and clinicsgovernments and clinics

• High cost in mass High cost in mass communicationcommunication

• Religious believeReligious believe

Thanks You!Thanks You!Marketing Group 5