Thesis (Master in Management)--University of the Philippines Mindanao, December 2007.

Confidential.

The Philippines poultry industry is a major contributor to the local agriculture economy accounting for 9-10% of the total value of agricultural products. The Philippines is a P82 billion chicken market. Broiler meat accounts for about 62% of the total chicken meat consumption while the balance is composed of 13% of chicken meat coming from native chickens, 23% from culled breeders and non-broiler breeds and 2% from layers. The Philippine poultry industry is dominated by six major broiler integrators supplying about 75% to 80% of the total broiler meat market. The balance is supplied by non-integrated commercial growers and small regional players. San Miguel Foods Inc. (SMFI) Poultry Business belongs to the food group arm of San Miguel Corporation widely known as San Miguel Pure Foods Company Incorporated (SMPFCI) has a vision " To be the number 1 food company in the Philippines and a strong regional player in Asia, providing quality food products, services and systems that delight and contribute to the well-being of our consumers." SMPFCI translated this vision into goals and articulated it in the acronym BHAG for Big, Hairy, Audacious Goal. SMPFCI's BHAG is stated as "US3.7 billion in revenues by 2010'. SMFI contributes about 20% to SMPFCI revenues. Translating, SMFI'S BHAG is US740 million in revenues by 2010'. SMFI is the acknowledged market leader in the broiler industry having a dominant market share of 40%. Its close competitor is the pool of commercial growers accounting for about 21% of the market. Majority of the broiler meat continues to be sourced fresh via local wet markets. The PEST tool and Michael Porter's Five Forces Model provide the analytical framework for the analysis of the external environment. In determining the transformation that is happening in the external environment; competitive forces, political, socio-cultural, economic, ecological, legal, technological and global factors are considered. The focal point of the external environment scan is to identify opportunities and threats. The opportunities and threats identified here are critical success factors in the external environment that can help strengthen the position of the company in the industry. An internal audit of the company was done to determine the organization's strength and weaknesses relative o the different functional areas such as operations, general management, human resource, finance and marketing. Strength and weaknesses are assessed before strategies are generated. The data gathered from the analysis of the internal and external environment of the firm supplied the information used in the development and generation of strategic options. With the use of the tools such as Internal-External (IE) Matrix and the Strength- Weaknesses-Opportunities-Threat (SWOT) Matrix, a total of eleven strategies are generated. Applying the Quantitative Strategic Planning Matrix (QSPM) narrowed down the strategic choices to two best fit strategies that appear complementary to the vision and goal o the company. The two strategies are Market Penetration and Regional Expansion in Vietnam. Implementing both strategies will lead to the attainment of the BIHAG of San Miguel Foods Inc.