Professional Documents
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Sarimento became the first commercial animal manufacturer in the Philippines, under the name Philippine
American Milling Co. Inc. (PAMCO). In 1962, PAMCO eventually moved to Marilao, Bulacan because of
its attempt to modernize production. PAMCO adopted the trade name “Vitarich”. After years of
development, the corporation was registered with Securities and Exchange Commission (SEC) under the
Vitarich Corporation, also known as VITA, was incorporated and organized on July 31, 1962. The
corporation entered the poultry business and built an experimental poultry farm that made them unite with
United States of America companies like, Cobb International, and Babcock Poultry Farms to have exclusive
By the early 1970s, the corporation further expanded its operations and extended its vertical
integration by acquiring dressing plants and cold storage facilities. In 1981, the corporation expanded
outside Luzon by setting up the Davao satellite feed mill. The following year it upgraded the Bulacan mill
In 1988 the corporation entered into a joint venture agreement with Cobb-Vandress, Inc.(CVI) and
formed Breeder Master Inc.(BMI). CVI is 100% owned by Tyson Foods, Inc., the largest chicken company
in the world. BMI is 20% owned by CVI and 80% owned by Vitarich. In 2002, the corporation decided to
dispose all of its BMI investments and agreed to pay its liabilities to BMI by returning all of its shares of
stocks to BMI. Thus, on February 12, 2003 the shareholders of BMI, namely CVI and Vitarich, entered into
a Memorandum of Agreement (MOA). Under the MOA all of Vitarich’s shares are returned to BMI leaving
On May 31, 2007, The Regional Trial Court of Malolos, Bulacan approved the rehabilitation plan
of Vitarich which is composed mainly of the restructuring of debt worth P3.2 Billion, resulting to longer
October 16, 2013, approval of debt to equity conversion and increase in the company’s authorized capital
stock. Consequently, Kormansic acquired 85.29% ownership of the company. In 2014, the Board of
Directors decided to dispose a major feed mill located in Marilao and other noncore assets to further reduce
its liabilities and increase its working capital. On November 5, 2015, the company filed with the
Rehabilitation Court a motion to exit the plan. On September 16, 2016, it was approved.
Philippines. They produce hog, poultry, aqua, and other specialty feed requirements for our livestock
operations. They formulate, produce, store, and market our feed which come in mash, pellet, crumble, and
extruded forms. The product line consists of broiler, layer, hog, aqua, and other specialty feeds. We sell our
animal and aqua feeds to distributors, dealers, and end users. The livestock operations involve everything
Vitarich Corporation focuses on the variety of feeds. There are 5 different kinds of products which
are Hog, Aqua, Broiler, Vitarich Titan, and Dairy Feeds. Under Hog, they offer Premium Plus and Supreme
Plus. Under Aqua, they offer Premium Floater, Premium Sinker, and Special Floater. Under Broiler, there
are Broiler Finisher Pellet, Broiler Grower Pellet, Broiler Starter, Chick Booster Crumble, Layer Feeds, and
Premium Broiler Feeds. Under Vitarich Titan, there are Stag Developer Crumble, Stabilizer Pellet, Breeder
Pellet, Chick Booster Crumble, and Conditioning Pellet. And lastly, Under Dairy Feeds, they offer Goat
Kid Starter, Goat Grower, Goat Dairy, Cattle Starter, Cattle Grower, Cattle Dairy, Buffalo Starter, Buffalo
Financial Highlights
In 2014, Vitarich Corporation brings an end to its seven (7) year receivership with Php 800 million
debt remaining. From there, through the efforts of their executives, their enormous losses became profits
which grew exponentially. They invested in derivatives and engaged in debt-to-equity swaps in order to
further stabilize their ground in the market. By the year 2015, Vitarich Corporation begins to receive profit
having a profitability ratio of 14.72% from 7.70% in 2014, further efforts later led to exponential growth in
terms of profit in the year 2016, but their maximization of investing lowered their ratio into a gross profit
margin of 12.41%. In 2017, Vitarich Corporation plans to expand production through a new automated
production facility in Davao City. Their solvency ratio for the year 2016 is 3%, which is relatively low, but
considering they are fresh from corporate rehabilitation and had a negative ratio before it shows that they
aqua, and other livestock. They also have a sub-operation focusing on providing food products for the
Filipino families, which are antibiotic-free and direct from the farm (Golden Dory by Cook’s) .
and will be the backbone of every Filipino farmer's success by providing the best solutions through its
Evaluation
Vitarich’s current vision entails all three of the characteristics of a vision statement - massively
inspiring, overarching, and long-term. It is massively inspiring and overarching due to its message which
includes the Philippine’s main source of income - agriculture. Given its vision to support the Filipino
farmers, Vitarich offers better improved products and enhanced its support services to aid Filipino Farmers
nationwide. Given its promise of continuity and innovation, we can truly see that Vitarich remains focused
Proposed Vision
Vitarich continues to be an agribusiness partner and innovator in the feeds industry that aims to be
the market leader in agribusiness industry and will be the backbone of every Filipino farmer's success by
Current Mission
To continuously adopt new business development programs and technological advancement that
agribusiness.
To provide comprehensive solutions through products and services in raising the standard of the
To build partnership with our suppliers and customers to achieve long term profitability and
Evaluation
Under David’s framework, we can determine that Vitarich Corporation contains all of the components
which render it well made though it has composition issues because of the word “to” that make it look like
a strategic objective. It provides for all of the stakeholders involved in the company, including their
employees. The company focuses on how to provide a gateway to the success of Filipino farmers, and to
raise the standard of the Philippine agribusiness industry. Vitarich’s mission is to continuously adapt new
business development programs and technological advancements to achieve long term profitability and
Vitarich empowers its customers by spreading knowledge and innovation in agribusiness industry.
2. Product and Services: “enhance the products and services”, “raising the standard of the Philippine
Vitarich includes in their mission statement their products and services and is consistent with their
promise of innovation.
advancement”
With their promise of continuous innovation, Vitarich adopts to new business development and
5. Concern for survival, growth, and profit: “to achieve long term profitability and sustainability and
Vitarich values its relationship with its suppliers and customers in order to achieve sustainability
6. Philosophy: “provide comprehensive solutions through products and services in raising the
Being the pioneer agribusiness partner and innovator in the feeds industry, Vitarich aims to raise
the standard of Philippine agribusiness industry by continuously providing best possible solutions to aid the
7. Self-concept: “empower employees and customers by imparting knowledge and innovations in the
agribusiness”
As a company that values innovation, Vitarich includes stakeholders and impart them with
8. Concern for public image: “build partnership with our suppliers and customers”
It is important for Vitarich to build partnership with stakeholders for the sustainability of the
company.
9. Concern for employees: “empower employees”
Vitarich empowers their employees and give them knowledge about agribusiness and innovations
in the industry.
Proposed Mission
Vitarich Corporation seeks to continuously adopt new business development programs and
technological advancements to enhance the quality of our products and services as well as to create sustain
competitive advantage. Along with the organization, we seek to empower our customers as well as each
other by imparting knowledge and innovations for the betterment of the Philippine agribusiness industry.
We aim to raise the standard by providing comprehensive solutions through our products and services, and
to build partnership with our suppliers and customers to achieve long term profitability and sustainability
Strategic Objectives
Vitarich Corporation has no strategic objectives explicitly stated in their company website;
therefore, we have assumed the absence of such. Vitarich, being an agribusiness, may consider the
Companies can increase market share through innovation, strengthening customer relationships,
The most viable plan of action is innovation, smart hiring practices and strengthening customer
relationships because, Vitarich, being fresh from receivership they lack the capital to acquire competitors.
Basis: According to bloomberg.com the stock price of Vitarich Corporation within 52 weeks ending
March 2018 averages to Php 2.03. Their all-time peak is Php 2.89. With this information, Vitarich highest
growth rate as of date is 14%. Within 5 years, if Vitarich maintains their investments on innovation and
Vitarich has just began investing in proper risk management activities. As of 2014, their publicly
announced derivatives is a debt-to-equity swap in order to stabilize their debt-to-equity ratio. As of now,
Vitarich’s current risks mostly involve liability risks due to their financial performance in the past years,
property risks due to their loss of major plants in the past years, and speculative risks. All risks currently
put Vitarich in a volatile state wherein they have just exited from the turn around. Therefore, we highly
suggest Vitarich Corporation to invest more on risk management in order to stabilize their financial
Poultry supply in the Philippines is considered insufficient, therefore being forced to import poultry
to satisfy the needs of Filipinos. According to BusinessMirror Journalist Jasper Y. Arcalas, Vitarich
Corporation has abandoned exporting internationally in order to focus on supplying the local market with
its products. The company has formally announced their intention to increase market share by 3% for the
year 2018. Considering Vitarich’s current efforts, it is believed that market share growth to 8% by 2023 is
highly probable.
Conclusion
Vitarich’s existing vision and mission are sufficient but needs further modifications in the long
term. In considering their strategic objectives, the absence of such has led us to propose a new set of
also it increases the opportunity for the Feed Mill Industry. Vitarich sells its feed products to dealers,
distributors, and end-users nationwide. Formulation, Production, Storage, and Marketing of various animal
Vitarich’s customer base consists of dealers, distributors, and end-users nationwide. These clients
are given credit terms from 30 days to 90 days, and some are cash basis customers. In Luzon, Vitarich has
a branch in Marilao, Bulacan and it is accounted for 49% of the total animal and aqua feeds sales volume.
While in Visayas, there are branches in Bacolod and Iloilo. In Mindanao, Vitarich can be found in Cagayan
De Oro and Davao, which Visayas and Mindanao is accounted for the remaining 51% of the total animal
and aqua feeds sales volume. Having a large population, there is a bigger threat to food security in the
country. Food securities can affect Vitarich Corporation due to its feeds that can make the animals’ growth.
Political-Legal
Republic Act No. 8435, or the Agriculture and Fisheries Modernization Act of 1997 deems to
enhance the current disposition of agriculture in the Philippines by expanding productivity through the
maximization of production capacity. Moreover, there exists environmental laws that intends to strengthen
the relationship of the industry and the community, along with the increase of security regarding the health
Through this act, the government emphasizes on empowering small farmers and fisherfolk through
cooperatives. The government provides data and equipment for the cooperatives to enhance production as
well as competitive rivalry within the industry. This act is also backed up and enhanced by PA2020, or the
Philippine Agriculture 2020 in which an updated development plan is created spanning fifteen (15) years,
from 2005 to 2020. PA2020 lays out the goal to have an annual production growth of 7% every year. This
act addresses their intention on making the Philippine Agriculture Industry compete globally, which should
1156, or the Livestock and Poultry Feeds Act requires agribusinesses to gain approval from the Bureau of
Animal Industry (BAI) and the National Meat Inspection Commission (NMIC) for the registration and
accreditation of an feeds manufacturer’s feed mill, chemical laboratory, meat plant, and storage. This helps
ensure the safety of both the animals and the consumers. Aside from registration and accreditation approval,
the act also informs the entities that there will be inspections by government representatives occurring
without prior notice. The inspection will serve as proof of whether or not the entity has complied with the
law.
The acts explained in the preceding paragraph establishes barriers against new entrants due to the
higher capital requirement and increased requirement of quality and safety assurance.
Economic Development
According to adb.org, Driven by broad-based expansion in domestic demand, the Philippine
economy continued to perform strongly in the first half of 2017. Philippines’ Gross Domestic Product grew
by 6.4% year on year in the first half of 2017, moderating from a 7.0% pace in the same period last year
but in line with the average 6.3% annual expansion since 2010. But if we are to specifically discuss about
P179,806.91 million in the fourth quarter of 2017 from P133,922.43 million in the third quarter of 2017.
GDP From Agriculture in Philippines averaged P140,650.76 million from 2008 until 2017, reaching an all
time high of P179,806.91 million in the fourth quarter of 2017 and a record low of P114,778.44 million in
the second quarter of 2009. Philippines’ Gross National Product on the other hand is also performing very
well. According to ieconomics.com, GNP’s all-time average stands at P1591624.29 million and it's
The Philippines remains among the fastest growing Southeast Asian economies this year, and the
economy of feed mill industry is positively an opportunity. According to the GNP and GDP of the
Philippines, the overall rate of our GNP and GDP has increased in the past 3 years. This is a good sign for
all the companies in our country especially those in agriculture. When the growth rate of the country is
Other economic factors such as Inflation rates and General growth of economy are also performing
very well. Inflation rates increased from 1.4% in 2015 to 3.2% this 2017. Increasing of inflation rates is
good because businesses are then forced to raise their prices. But the disadvantages are that banks are forced
to also raise their interest rates and higher inflation rates also results in higher rates of unemployment that
is why the share of agriculture in total employment was declining according to countrystat.psa.gov.ph. In
2016, the share went down to 27%. Luckily, the general growth of the economy was not too affected
because of this. In 2016, the country's earnings from agricultural exports were higher by 2.89% from the
Socio-Cultural Trends
Changing consumer preferences and issues on the effects of intensive agriculture on environmental
sustainability and on human health shifted from quantity-driven to quality-driven agricultural production.
Hence, concepts like sustainable development, sustainable agriculture, food safety, and good agricultural
practices as well as international agreements, protocols, guidelines, and standards to promote favorable
effects on the public good increasingly become the focus of government and nongovernmental efforts,
shaping what Food and Agriculture Organization (FAO) calls "globalization with a human face." As the
demand of chickens increased, outbreaks like Avian flu concerned consumers but efforts have been made
to assure stakeholders that Vitarich use highly advanced and meticulous biosecurity measures which are
Technological Trends
In technological aspects, high tech materials and equipment are released, much improved and
upgraded, that will help a production capability for a company. Product Quality and Animal Nutrition is
the focus of the industry. The industry poses for more improved materials and equipment that they can use
in order to meet the high demand. Also, in raw materials of the industry, promotion of growing and usage
of alternative products for the supply will solve the difficulties of the industry. Because Vitarich is always
on the look for the best and latest technology, Vitarich became the pioneer in many things. “They were the
first to introduce the floating fish pellets into the Philippine aquaculture industry, and had been considered
a leader in the field to this very day”. Their constant effort to provide the best technology led them to
pioneer a new industry that will focus on the potential of the Philippines to produce Pangasius fishes.
Vitarich is now also capable of expansions because it is now free from corporate rehabilitation, their newly
opened state-of-the art feed mill in Davao can produce 10 tons per hour which is equal to 100,000 bags of
50 kilos per bag. Not only does this mill cater the needs of the consumers, but it also ensures them that what
they are getting are quality products, thus increasing their efficiency as well as their sales at the same time.
Because of their top of the line products they achieve customer intimacy.
Environmental Trends
Because of the growing consciousness towards the destruction of our environment, an enterprise
should commit itself in the reversal of it. Vitarich, a company of means involves itself by partnering up
with communities and conducting clean-ups, an example of this is their participation in “adopt an estero” a
clean-up program of Marilao creek last July 26, 2014. By cleaning the downstream of Marilao creek from
the dressing plant, the program aimed to reduce chemicals or other waste material that might cause damage
to the dwellers of Marilao. Another show of concern is through their Geenovation Campaign this is a
campaign to help supply safe foods and are not harmful to the environment. This is also sustainable and at
the same time the produce are of quality because it complies with the International Certification Standards
such as ISO 9001: 2008 and HACCP as proof of its commitment to quality.
Global Trends
The world’s population is expected to increase to 10 billion by 2050. A portion of the population
said will be attributed to the Philippines, which is basically the major market of Vitarich. Having the
technological and plant expansion investments, Vitarich can capitalize while implementing a sustainable
plan of action because of their investments in technology and expansion. Critical parts of food systems are
becoming more capital-intensive, vertically integrated and concentrated in fewer hands. This means that
small-scale producers are the first to lose out and seek employment outside of agriculture. This can be
prevented by Vitarich by continuing their investments in technology and by using business models that are
timely.
ability to pay for items. Vitarich is the first commercial feed company in the country. It has been producing
feeds in a world quality standards for almost 68 years. The corporation has the opportunity in market
demand because of the rising population in the Philippines. Having high demand, gains revenue. It has a
Therefore, rising population means the consumption also rises, and the demandes rises. Having a
large population, competition is also considered. Expanding the competition, many wants to cater the
animal and aqua feeds. The product line of feeds consists of broiler feeds, layer feeds, hog feeds and aqua
feeds. The expansion of providing feeds for ducks and meat products can be one of the opportunities to
Vitarich. According to Dr. John Strak, the meat production of pork in the Philippines proves to be constantly
growing as an attempt to fill in for the demand of the Filipinos. Vitarich start investing in meat products,
Some are searching for substitutes and Vitarich has no non-processed substitutes that are available.
Feeds can be just any food, but the nutrients can only be processed for animals to have, and there is no
competitors are Foremost Farms, Inc with Foremost and Rich (0.71872%), General Milling Corp. with
General Feeds (0.13743%), San Miguel Foods, Inc. with B-meg Feeds (1.38752%), Swift Foods, Inc. with
Blue Ribbon Feeds (0.00053%), and others (97.69238%). Vitarich enhances its competition by having
strategic plans and objectives. Competition does not just focuses on consumer products but also with the
production of resources. The competition happens on product feature, support service, delivery time and
brand image. Vitarich’s opportunity is to be the first follower in innovation - it is the first step toward
beginning a movement that might seem unusual or out-of-step with surrounding culture to general
population. Other competitors like Universal Robina Corp.’s Starfeed 555 have ducks and meats in their
products, Vitarich must aim to have same products that will make them first follower.
purchases from local traders. For example, last 2017, Vitarich partnered with local farmers and the
Department of Agriculture (DA) to process corn supply at the company’s new feed mill in Davao city.
Department of Agriculture said that the farmers will not be compelled to sell their entire harvest to the
company if they can find higher prices from other buyers. They will be under contract to sell half of their
produce at a premium price to Vitarich, which in turn will be providing farm inputs. But Sometimes, the
Corporation imports materials from Australia, North and South America, India, and Pakistan. There are
research and development ongoing to substitute grains to be by-products. According to Ricardo Manuel
Sarmiento, also known as Rocco, the CEO of Vitarich Corporation, their suppliers are wonderful - they
have supported the corporation through it all. If not for the suppliers, Vitarich would not be where they are
now. The company owes the suppliers a lot. Vitarich claims that their suppliers were the secret to the
company’s survival over the years. “They were there with us during the hard times, and now that we
are better they are very happy because it means more business for them, and we give them
preferential treatment.” (Sarmiento, 2016). But Vitarich is willing to recruit and develop new dealers
and distributors. They are looking for additional suppliers of farm to help grow its net income by 17 times
for 2018.
The opportunities regarding the suppliers of Vitarich is that new alternative raw material suppliers
exist, they have the opportunity to choose the suppliers which are near the country and which sell prices of
the same material at a lower cost. The threats on the other hand is that their intention to innovate is costly,
and coming from receivership, is risky in terms of cash consumption. Another threat is that there are limited
number of suppliers.
Financial aspect
Sale of goods of feeds segment increased by P867 million or 42%, from P2,059 million registered
in 2015 to P2,926 million registered in 2016 due opening new hog and broiler farm customers.
The opportunities regarding the financial aspect of Vitarich is that their innovations can lead them
to increase profitability. Another is increased credit limit. The threats on the other hand is that they have
services. They will provide superior technical assistance and after sales service. According to their 2017
financial statements, their current services include giving assistance to the farmers who are in use their
products and services. This is an opportunity for the farmers to produce, provide, and analyze how to
properly feed and take care of the livestock animals with the company’s feed. This will also be a threat to
other corporations due to ambitious profitability and services that Vitarich can offer.
standards and laws, and the high fixed costs involved in operations. With that in mind, entry barriers are
high.
The laws explained in the external environment require continuous reporting and unscheduled
inspections by representatives of the government. This in itself presents the need of tedious sanitary
processes which, if improperly done, would inevitably ruins the face of the company.
Along with compliance and sanitary costs are laboratory costs in the manufacturing of feeds and
meat, which contain chemicals that need to be handled with utmost care due to its direct effect on the health
of consumers.
The industry’s top players consume a maximum of 2% of production due to the Philippines being
primarily reliant on agriculture to sustain GDP. According to the Department of Trade and Industry’s
Roadmap of Agribusiness, 85% of the raw materials involved in productions are imported from countries
due to the rarity of chemicals and the increased need to observe sanitation.
Competitive Rivalry
The rivalry in the Philippine agribusiness industry is high due to the tremendous amount of players
involved. The top ten players in the feeds manufacturing sectors are in tight competition with each other
and has proved to produce new standards and practices in the production of feeds and meat. Many
competitors are also highly integrated and diversified. Vitarich has a reputation risk because of the
receivership they experienced and efforts should be done to gain the trust of it's buyers.
Bargaining Power of Buyers
The bargaining power of buyers in the agribusiness is high due to a high demand for the product.
Buyers tend to look for a product with a good brand reputation that delivers quality and cater to their needs.
Buyers are attracted to products that addresses environmental sustainability and food safety. Collaboration
between the buyer and selected suppliers provides an advantageous win-win situation.
commodity. A “commodity” means something useful or valued which means these products are necessary
for the business’ normal operations. In other words, Vitarich needs its suppliers for them to run their
business.
Another reason is that good substitute inputs exist. Livestock growers are able to substitute feeds
with the appropriate food consumed by humans. Lastly, industry members account for a big fraction of
supplier’s total sales and continued high volume purchases are important to well-being of suppliers.
Threat of Substitutes
The threat of substitutes in Philippine agribusiness is moderate because good substitutes are not
readily available. But on the other hand, there are a lot of non-manufactured substitutes readily available.
“Good substitutes are not readily available” means despite having many competitors there are only
few feeds which can be a substitute, for example, only Vitarich sells feeds for Gamecock. “A lot of non-
manufactured substitutes are readily available” means customers may decide not to buy feeds because they
Affected Areas
reached 2.1-2.3 million tons per year, with an expectation of growth as high as 3% as capacity increases.
However, this is proven difficult because of the high bargaining power of suppliers. To increase capacity
means locking in suppliers willing and able to provide for at a rate that is enough for operations. An attempt
to comply with a higher-than-usual price produces higher prices for feeds, which in turn will affect the
buyers due to their high bargaining power. Any attempt to expand operations, by any of the players, proves
to be a difficult feat to accomplish. Therefore, there will be growth to be expected, but only by small
increments.
Feeds manufacturing also affects livestock production, which is another product produced by
Vitarich. So far, with a 4.6% growth in the livestock sector, and imports still needed, it is expected that the
competition involved within the industry will intensify until the demand for livestock goes down.
easily deduced that the market size of both is approximately the same. Filipinos consume
approximately 14.5 kg, which is 2 kg more than the world’s average. The PSA states that an
will require an increase of feeds. With this information, we can infer that the market size reaches
Vitarich Corporation has decided to focus on domestic markets. In 2014, after the company went to
rehabilitation, that has a reputation risk and could not aggressively compete, Vitarich went back on track
and continued agribusiness industry. Due to increasing economy, buyers have more power to buy.
Connecting to this, the consumption of Philippines increases, so as the demand on food, and the feeds also
increases.
Raw materials of the feed business are corn, wheat, soya, and rice bran, which the corporation
purchases from local traders and sometimes, the corporation imports materials from Australia, North and
South America, India, and Pakistan. According to the CEO of Vitarich, Business is business, but they
(suppliers) have played a vital role in the resurrection of Vitarich and a lot of them have become
good friends of my family and also of the organization. Suppliers became the one of the keys to
Vitarich’s success.
Technology developments
Vitarich Corporation continues to provide the best for its stakeholders following the turnaround.
Since the company’s turnaround in 2014, Vitarich Corporation has been investing its resources in the
creation of new plants, one of which is the new automated production plant in Panacan, Davao City which
opened last October 13, 2017. The capacity of the plant is 10 tons per hour of animal feeds. That is
According to the company website, they have a handful of new systems available also for the
improvement of their operations. One of their new operations is Integrated Broiler Operation. When the
demand for chicken increased, Vitarich was one of the few companies that took the risk of providing
chicken products to the country's growing population through their integrated broiler production all the way
to further processing and value adding under the Cook's Chicken Brand. Another development was the
Extrusion Technology. Vitarich is always updated with what’s the best and latest equipment & technology.
Vitarich was the first company to introduce floating fish feeds into the Philippine aquaculture industry, that
is why they’ve been considered the leader in this field from then till now.
Vitarich believes that as an integrated poultry producer, it is their job to oversee every aspect of the poultry
production process from hatching, breeding, processing, up until sales. According to Vitarich, “Given our
vision to serve our customers with effective technical and marketing support, it is not surprising that we
dedicate substantial resources to the research and development of production process improvements and
product value enhancement.” The establishment of Vitarich’s Research Center, which is the first of its kind
in the Philippines, is solid proof of their desire to enhance the quality of their products.
Industry prices
Promotion
They have a very active facebook page and twitter account. They are also quick to answer queries
Vitarich also offers contract growing for small and medium scale entrepreneurs who want to start
a business. Vitarich provides the day-old-chicks, feed support, vaccines, technical services, and other
services, even logistics and marketing. Entrepreneurs need little initial capital, they just need to take care
of the housing, labor, power, light and water, equipment, medication, and other miscellaneous expenses.
Vitarich guarantee quality and performance, providing the best support possible, fluctuations in prices and
Distribution
Their scope of distribution is nationwide, Vitarich’s customer base consists of dealers, distributors,
and end-users nationwide. These clients are given credit terms from 30 days to 90 days, and some are cash
basis customers. In Luzon, Vitarich has a branch in Marilao, Bulacan and it is accounted for 49% of the
total animal and aqua feeds sales volume. While in Visayas, there are branches in Bacolod and Iloilo. In
Mindanao, Vitarich can be found in Cagayan De Oro and Davao, which Visayas and Mindanao is accounted
for the remaining 51% of the total animal and aqua feeds sales volume.
Prices
We, the researchers, have been doing our best to find the prices but unfortunately the data is
unavailable at the moment. We are expecting to have it soon after the approval of the company.
years. However, as the number of players increased in the industry they were unable to keep up. They were
unable to control their spending which therefore led to their downfall to the 5th position. They were unable
to cope up, mainly because of the huge amount of unpaid liabilities, this made them enter receivership.
After this corporate rehabilitation their first move was to expand and invest in state of the art facilities and
equipments. This was made to cater the growing needs of hogs and chicken breeders. One of their
competitive advantage is their research and development because they innovate products from time to time
and it helps them in their survival in the industry. Vitarich saw the potential of the Philippines as a major
producer of Pangasius fish and pioneered an industry that will not only be profitable to them but also to the
Filipino fish farmers by using integrated business models that maximizes the benefits and recognizes the
Summary
Make a summary of the industry analysis. What are the key external environmental issues, challenges and
problems in the industry and how would they affect the organization?
In 2007, Vitarich proposed a rehabilitation plan in restructuring the company debt amounting P3.2
billion originally to have longer payment terms and decreasing the amount of interest. Vitarich also
experienced liquidity problems due to over-supply of poultry in the market and tight competition that forced
the company to cut almost 600 employees. After almost 8 years, Vitarich filed to exit the rehabilitation
plan. The company made sure to capitalize from their exit by expanding and they made sure they remained
relevant by attending a lot of summits. The aforementioned are indirect promotions of the company and
Philippines, having a huge number of meat eaters, Vitarich’s expansion amplifies their profitability.
Their active social media is also an asset, this ensures the intimacy between them and the customers given
that their bargaining power is high. As to suppliers, they maintain a number of them (Foreign and local
suppliers). The stable growth rate of the industry will translate to higher profits as long they maintain their
Their investments in state of the art equipment and facilities does not only increase their output but
also the efficiency of production. Investments in technology, were ignored before and was one of the
reasons they could not keep up with big players in the industry. Their strength is in niche marketing, their
research and development team, should take into consideration the preferences of the Filipino people now
that they are planning to make them the sole market of livestock.
Sources
https://businessmirror.com.ph/vitarich-wants-to-focus-on-domestic-market/
https://vitarich.com/news/press-release/vitarich-wants-focus-domestic-market-business-mirror
http://www.sunstar.com.ph/davao/business/2016/12/28/agriculture-dept-sees-rise-demand-
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