Thesis (Master in Management) -- University of the Philippines Mindanao, April 2019

The Philippine pharmaceutical has enjoyed a steady growth and is expected to keep that momentum until 2020. This is partly due to factors such as the rise of the Philippine?s aging population, the current administration working hard and fast to improve access to healthcare services, and to chronic diseases brought about by unhealthy lifestyle and urbanization. To take full advantage of this robust opportunity, pharmaceutical corporations turn to distribution companies such as Novomed. This business strategy will allow the manufacturer to limit its exposure to sales and focus its resources on efficient manufacturing techniques. While operational for eight years, Novomed has not established a comprehensive marketing plan to exploit opportunities for the expansion of its business. Tight competition from more aggressive distribution companies make it even more challenging for the company to optimize its growth. Further, legislative challenges such as the newly implemented TRAIN Las has also been a major threat to the business. This paper then provides a comprehensive case study of Novomed?s competitive condition by using a combination of various analytical tools. As the company suffered a steady decline in sales for the past years, this research then aimed at first, analyzing the causes of sales disgrowth and secondly, at arriving and crafting at a sound and comprehensive marketing plan to improve the profitability of the business. There were several models and approaches used in this strategic paper including Porter?s Five Model, External Factor Evaluation (EFE) matrix, Internal Factor Evaluation (IFE) matrix, Strengths-weaknesses-Opportunities-Threats (SWOT), Strategic Position and Action Evaluation (SPACE) matrix, and Quantitative Strategic Planning Matrix (QSPM). It is noteworthy that Novomed?s score in the EFE matrix is only at 2.4 which reflects the company?s inability to effectively respond to external factors such as deflecting threats to cushion its impact and to exploit opportunities when there is present. Meanwhile, its IFE matrix is scored at 2.68 which shows an average internal position of the company to be neither weak nor strong. This paper recommends to follow a three-stage strategy composed of Input Stage, Marketing Stage, and Decision Stage to introduce changes in the management of business. Under the input stage, Novomed will have to identify and organize its issues that resulted to disgrowth. This is a necessary step in order to create mitigating measures that will support the company's long-term objectives on expansion and growth. On the other hand, the matching stage utilizes the result arrived from doing the SWOT Analysis and SPACE matrix, respectively. Both tools will complement each other?s result and will enable the identification of a measurable and objective base, especially under marketing strategies. Lastly, the decision stage is identified with the implementation of QSPM which utilized alternative strategies and will sustain the effort of increasing long term profitability. Further, three categories of alternative strategies were also strongly recommended, namely: Market Penetration, Market Development, and Product Development. Market penetration strategies will re-launch the company?s existing and future products through focused marketing efforts. The market development strategy will be in place to sustain the momentum of the market penetration strategy as the company expands its distribution to include more areas in the greater whole Davao region. The product development will cater the needs of offering a new product line to accommodate a wider market base. A systematic action plan was also put in place to address the issues such as absence of marketing plan that will cushion threats and exploit opportunities, the need to revamp the organizational structure to arrive at streamlined responsibilities and effective management, and the need to monitor progress. Key performance indicators (KPI) as well as key result areas (KRA) were identified in various stages of the implementation of the strategic plan. Should this strategic plan be successfully followed, Novomed will successfully bounce back to business, will gain more grounds for expansion and growth, and will even the potential to have its business model a benchmark in the local pharmaceutical distribution industry.