Management Accounting p2

7/26/2019 Management Accounting p2

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MANAGEMENTACCOUNTING

P2


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ABOUT JOLLIBEEFOODS CORPORATION

Jollibee is the largest

fast food chain in the

Philippines, operating a

nationwide network of

over 750 stores.


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The company has also embarked on an

aggressive international expansion plan in

the U!, "ietnam, #ong $ong, a%di

!rabia, &atar and 'r%nei,

Jollibee was fo%nded by Tony Tan and his

family with its h%mble beginnings as an (ce

)ream Parlor which later grew into an

emerging global brand*


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Jollibees growth is due to its delicious menu line-up likeits superior-tasting Chickenjoy, mouth-watering Yumburger

and Champ hamburger, and deliciously satisfying Jollibee

paghetti -ably complemented with creati!e marketing

programs, and efficient manufacturing and logistics

facilities.

Great Tasting Products and Quality Systems


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PROBLEM STATEMENT

The newly appointed head of

(nternational division +r +anolo

P* Tingon is pondering into

contin%ing with its strategy of

expanding its b%siness base into

potential markets*The markets

in consideration are Pap%a -ew

.%inea, #ong $ong and

)alifornia*


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"


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NEW MARKET ANALYSIS

PAPUA NEW GUINEA: #arketing tothe populace here will be of major

challenge as it is one of the most di!erse

countries of the world with o!er $%&

languages being spoken by a population of

just se!en million. $%' of the people here

depend on agriculture for li!elihood.


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PAPUA NEW GUINEA: ince this

would be its first store in (apua

)ew *uinea, Jollibee will ha!e

to incur huge e+penses in termsof conducting market research

about consumer preferences,

hiring competent staff and its

training


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HONG KONGJollibees e+isting stores in ong ong are

already struggling with management issues.nstead of aggra!ating the differences

between the Chinese and /ilipinos, the tore

#anagers are re0uired to moti!ate the staff

to achie!e a common goal.

1+panding to fourth store in ong ong is not

an issue of financial terms but more ofmanpower re0uirement 2Chinese3 and also of

local perceptions related to food


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A!I"O#NIA-4eing able to successfully run a store

in California would be a significantmilestone in the growth of Jollibee.

-4ut in order to succeed in this

market, it needs to upgrade its

technology as the labour cost is

enormously high in this part of theworld


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A!I"O#NIA. n order to make a mark,

Jollibee needs to in!est hea!ilyon promotional campaigns and

meanwhile, needs to keep doing

what it is best at modifying the

recipe to prepare e+actly what

the consumers wanted


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DECISION 1ntering into California market will bring a high branding

opportunity although it may face tough competition and

cost being part of tates. 4ut looking at the high immigr(ilipino population the sales may be largely supported by

their tastes.

5ith a franchising partner ready to ser!e as an in!estme

about 6&' the starting operation may be easy

5ell connected with international air and sea routes the

state can pro!ide fast and effecti!e logistics 2e+amples7

8os 9ngeles nternational 9irportand

an /rancisco nternational 9irportare major hubs for tr

(acific and transcontinental logistics3
http://en.wikipedia.org/wiki/Los_Angeles_International_Airporthttp://en.wikipedia.org/wiki/San_Francisco_International_Airporthttp://en.wikipedia.org/wiki/San_Francisco_International_Airporthttp://en.wikipedia.org/wiki/Los_Angeles_International_Airport


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ABOUT COCA COLA COMPANY

The )oca/)ola )ompany is an

!merican historical m%ltinational beverage

corporation and man%fact%rer, retailer, and markete

of nonalcoholic beverage concentrates and syr%ps,

which is head1%artered in !tlanta, .eorgia*

The company is best known for its flagship

prod%ct )oca )ola, invented in 2334 by

pharmacist John tith Pemberton in )ol%mb%s,

.eorgia*


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PROBLEM STATEMENT

Economic

:here is low growth in the market for carbonated drinks, especially in Coca-Colas

main market, )orth 9merica. :he market growth recorded at only ;' for )orth

9merica in


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ALTERNATIVES

9c0uiring = and *8=C 2a potato chip and

snack food company3

(roducing a new diet soda line made form

more healthy sugar alternati!es

4oth alternati!es


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DECISION

:he >(# strategies assessed whether ac0uiring= and *8=C 2a potato chip and snack food

company3 was a better option than producing a

new diet soda line made form more healthy

sugar alternati!es. 4oth scores on the >(# are

relati!ely close and gi!en the financialcondition of = and *8=C, it is recommended

Coca Cola undertake both strategic alternati!es.


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The Net Worth of both comp!"e# "# pro$"%e% be&o'( It "#e#t"mte% "t 'o)&% co#t *2++ m"&&"o! to re#erch, pro%)ce !%mr-et the !e' %"et %r"!-#(

1. Stockholders Equity + Goodwill = 79 + 28 $ 107

2. Net ico!e " # = $%2 " #= $ N&

'. Sh(re )rice = $2.7'*ES 0.9% = N&" Net ,co!e $%2= $ N&

%. Nu!-er o Sh(res /utst(di " Sh(re rice = # " $2.7' = $ 177

ethod &3er(e $1%2

1. Stockholders Equity + Goodwill = 19.% + 0 $ 19.%

2. Net ico!e " # = $1.2 " #= $ .0

'. Sh(re )rice = $2.9#*ES 0.19 =$1#.#2 " Net ,co!e $1.2= $ 18.

%. Nu!-er o Sh(res /utst(di " Sh(re rice = 11.2 " $2.9# = $ ''.0

ethod &3er(e $19.'

Krispy Kreme (KKD) Net Worth January 2008 (in millions).

Golden Enterprises (GLDC) Net Worth January 2008

(in millions).


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ABOUT KENTUCKY FRIED CHICKEN(KFC) CORPORATION

entucky /ried Chicken 2/C3 is a fastfood restaurantchain that speciali@es in fried chicken and is

head0uartered in 8ouis!ille, entucky, in the Anited tates

:he company is a subsidiary of YA#B4rands. t is the worlds second largest restaurant chain 2as

measured by sales3 after #c=onalds, with ;$,$D% outletsin ;;$ countries and territories


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/C was founded by arland anders, an

entrepreneur who began selling fried chicken

from his roadside restaurant in Corbin, entucky,

during the *reat =epression. anders identified

the potential of the restaurant franchising

concept, and the first Eentucky /ried ChickenE

franchise opened in Atahin ;F%


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PROBLEM STATEMENT

W$at mar%et entry strategy to &eem'loy in t$e e('ansion in $ina)


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ALTERNATIVES

/ranchisingG8icensing

5holly owned subsidiary

Joint !enture


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.r!ch"#"!/0L"ce!#"!/

/irst, /Cs traditional franchising strategy, which is

emphasi@ing standardi@ation and reducing financial risk, on

the e+pense of cultural sensiti!ity and control. =ue to

Chinas strict foreign in!estment laws such a strategy is not

feasible. n addition, /C will be pioneering in the fast-food

field and thus needs to be highly sensiti!e to culturaldemands. n the past, /C encountered problems with

aligning corporate planning with franchisees short-term

focus on profitability.


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Who&&1 o'!e% #)b#"%"r1

uch a strategy relies upon total control o!ercompetiti!e ad!antages and ensures complete

operational and strategic control. t also in!ol!es

high in!estment e+penses with no financial risk

sharing. 5ith high le!els of resource commitment

and little country-le!el fle+ibility andresponsi!eness, this option is not recommended.


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DECISION 1+pansion in China through Joint !enture strategy.

:he potential si@e and growth of the market inassociation with impro!ing political stability

makes the Chinese market !ery attracti!e. 9s /C

has been able to successfully e+pand into the

(acific 4asin, and its popularity in the region

2large portion of the population is Chinese3, thepeople in China will most certainly find /Cs

products attracti!e.


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DECISION n addition, the ready access of 0uality poultry in the

major metropolitan areas and host go!ernmentemphasis on moderni@ation of this industry can

ensure a reliable supply of supplies. Hpposite to this,

potential competitors such as #ac=onalds face major

barriers to enter the market due to poor beef supply.

#oreo!er, the Chinese go!ernment has opened-up

access to its markets.

.


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Abegail L. DazoPatrik Jay Joven

Perly Syjuco

P#ESENTE* +,:

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Management Accounting p2