PUREGOLD

PRICE CLUB
INC.
Company
Background
This chapter presents an overview of
Puregold Price Club, Incorporated
(PGOLD), a prominent Philippine
hypermarket chain boasting 525
branches. It will discuss the company's
corporate background, analyze its
current and proposed vision, and
mission statements.
Puregold Price Club, founded by Lucio Co Company
and Susan Co in 1998, is a leading grocery
Profile
retail chain in the Philippines, renowned for
its diverse product range and reasonable
prices. Through initiatives like the Tindahan
ni Aling Puring program, Puregold supports
sari-sari store owners, fostering
entrepreneurship and financial inclusion.
With over 500 nationwide locations,
Puregold has become a preferred
destination for both Filipino consumers and
resellers, offering a variety of essential
goods and services.
 PESTEL
ANALYSIS

PESTEL analysis helps identify key factors

impacting the food and beverage industry.
Puregold Price Club, Inc. uses this analysis to
understand its external environment and make
smart decisions to manage risks and seize
opportunities. It covers six main factors:
Politics, Economics, Social, Technological,
Environmental, and Legal.
 P E S T L A N A L Y S I S

P E S T L
P O L I T I C A L E C O N O M I C S O C I A L T E C H N O L O G Y LEGAL

Inflation Changing Labor laws

Sally Mobile
Tax Demographics
Currency App Natural
Sin Tax Changing Puregold
GDP Controls
Lifestyle Channel Customer
Changing Cloud
Security Laws
Demands Services
CRM
Solutions
 5 Threat of New Entry to
Existing Players

4 Threats Of Substitute
Products or Services

3 Bargaining Power of Customers

2 Bargaining Power of Suppliers

1 Rivalry Among Firms

PORTER’S
PORTER’S
FIVE
FIVE FORCES
FORCES
External Audit
Analysis

This section will cover

Puregold's Comparative Profile
Matrix, External Factor,
Evaluation (EFE) Matrix, and
Opportunities, Threats, and
Evaluation Matrix.
External Factor Evaluation (EFE) Matrix
Competitive Profile Matrix (CPM)
Value Chain Analysis
 Financial Ratio Analysis
Liquidity Ratios 2022 2021

Current Ratio 2.64 3.84

Quick or Acid Ratio 1.6 2.58

Leverage Ratios 2022 2021

Debt Ratio 49.96% 46.33%

Debt to Equity Ratio 1.51 1.57

Long-term Debt to Equity 0.60 0.61

 Financial Ratio Analysis
Profitability Ratios 2022 2021

Gross Profit Margin 0.42 0.43

Operating Profit Margin 0.028 0.031

Net Profit Margin 0.021 0.023

Return on Assets 0.037 0.040

Return on Equity 0.012 0.012

Internal Factor Evaluation
Internal Factor Evaluation
 STRENGTHS WEAKNESSES

Numerous Branches in Luzon (319 Branches)Customer Programs/Perks (Loyalty and

membership cards, discounts, etc.)Strong Supplier Relationships (over 1,500
suppliers and trade partners)Affordable Pricing (about 3.07% and 3.99% lower on
average)Corporate Social Responsibility (Panalo Cup for Back to School, Tindahan Ni High Dependence on Philippine Market (Target Consumers are Filipino
Aling Puring Negosyo Convention, etc.)Good Customer Relationships Alliances and Households)Limited Parking Spaces Pricing Errors and Ghost Items Difficulty in
SWOT MATRIX Joint Ventures (Ayala Corporation, PG Lawson, and Entrego)Distribution to Sari-Sari Expanding in Visayas and Mindanao (Low Economic Growth, Safety and Security)Limited
Stores (they served over 350,000 sari-sari stores and small to medium-sized Global PresenceHigh Operating Costs Lack of Inventory Management (Particularly
concerning products nearing expiration dates)Leverage Ratios (49.69% debt ratio)
businesses)Brand Reputation (16% increase in brand value)Liquidity Ratios (
Puregold’s current ratio was 2.64, while the quick ratio was 1.60)Profitability Ratios
(the return on assets (0.037) and return on equity (0.012) remained relatively stable,
indicating consistent profitability.)

OPPORTUNITIES SO STRATEGY WO STRATEGY

Enhance store facilities by adding commercial spaces for rent to partners, businesses,
Economic Growth of 5.6% in its GDP in 2023.Growth in Retail Industry of 7.56% from Utilize the extensive presence of 319 branches in Luzon to capitalize on the 5.6% economic growth by
and others, leveraging projected infrastructure growth and credit expansion to enhance
2024 to 2029.Infrastructure Development with a credit expansion rate exceeding 10% increasing marketing efforts, expanding store services, and enhancing in-store experiences to attract
customer convenience and drive more traffic to stores. (W1,02)Implement cost
in 2024.Population Growth in the Philippines exceeding to 100 million.Technological more customers. (S1,01)Leverage relationships with over 1,500 suppliers to integrate advanced
optimization strategies, such as energy-efficient store designs and automated
Advancement of Puregold led to a 9.2% increase in sales and a 19.1% rise in net inventory management systems and optimize the supply chain using technology, reducing costs and
processes, to reduce operating costs and take advantage of the 7.56% projected
income in 2020. Sustainability Practices pertaining to sustainable and eco-friendly improving stock availability. (S2,03)Enhance CSR initiatives like the Panalo Cup for Back to School and
growth in the retail industry. (W2, O4)Invest in advanced inventory management
practices such as Ecological Solid Waste Management Act of 2000 (Republic Act No. the Tindahan Ni Aling Puring Negosyo Convention by incorporating sustainable practices, such as
technologies to address the issue of products nearing expiration dates, improving
9003).Diversification of Product by offering their own product line and benefit from eco-friendly packaging and waste reduction, to meet regulatory requirements and consumer
efficiency and reducing waste. (W3, O5)Diversify product offerings and explore
suppliers like Nestlé and Universal Robina.Partnership with Local Suppliers such as expectations. (S4. 05)Expand the distribution network to over 350,000 sari-sari stores and introduce
potential markets outside the Philippines to reduce dependency on the local market
farmers for fruits and vegetables. a private label product line to diversify offerings and meet changing consumer needs. (S8,07)
and mitigate risks associated with economic fluctuations. (W4, O7)

THREATS ST STRATEGY WT STRATEGY

Explore international market expansion and diversify product lines to reduce reliance on
the Philippine market and stay competitive against the growing number of local
Strengthen customer loyalty programs and introduce dynamic pricing strategies to offer personalized
competitors. (W1,T5)Implement cost-saving measures, such as renegotiating supplier
discounts, mitigating the impact of price increases on sensitive customers. (S3, T1)Develop
contracts and optimizing workforce management, to mitigate the impact of economic
Inflations and Price Fluctuations(3.4%)Sensitive to Rising PricesSupply Chain alternative supply routes and strengthen relationships with local suppliers to ensure steady product
recession and maintain profitability. (W2, T7)Invest in training and compliance systems
Disruptions (6-10%)Cybersecurity RisksGrowing Number of Competitors flow to sari-sari stores, mitigating supply chain disruptions. (S8, T3)Invest in advanced cybersecurity
to reduce pricing errors and ensure adherence to evolving regulatory requirements,
(5.4%)Environmental RisksRegulatory ChangesEconomic Recession measures to protect customer data and maintain trust, thereby safeguarding the brand's reputation.
avoiding penalties and maintaining customer trust. (W3, T6)Develop targeted marketing
(S10. T4)Enhance CSR initiatives with a focus on disaster preparedness and community support to
campaigns and localized strategies to overcome expansion barriers in Visayas and
mitigate the impacts of environmental risks like natural disasters. (S4, T6)
Mindanao, addressing economic challenges and enhancing market penetration. (W7,
T8)
Strategic Position and Action
Evaluation (SPACE) Matrix
Internal – External (IE) Matrix Model
Grand Strategy Matrix
Summary of
Matrices
 Quantitative Strategic
Planning Matrix
The QSPM analysis shows that Puregold is slightly better at mitigating
threats (TAS 3.2) than leveraging opportunities (TAS 2.88). Threats like
inflation and supply chain disruptions need proactive management,
while opportunities like economic growth and technological
advancement can drive market penetration and product development.
Additionally, Puregold has a higher potential to capitalize on its
strengths (TAS 3.03) than to mitigate weaknesses (TAS 2.34).
Strengths such as numerous branches in Luzon and strong supplier
relationships aid market penetration, but weaknesses like high
dependence on the Philippine market need strategic attention to
enhance competitiveness.
CONCLUSION
 Recommendation

FORWARD INTEGRATION
BACKWARD INTEGRATION
HORIZONTAL INTEGRATION
MARKET PENETRATION
PRODUCT DEVELOPMENT