and teaching them a set of values that Natasha shows by example. Today, Natasha’s direct selling is through over 200,000 dealers, 80% of which are active. The dealers earn income in two ways: by direct or personal selling where the dealers receive 22% discount off catalog price, and by recruiting new dealers. A dealer earns a graduated rebate based on a scheme that rewards the recruiting dealer a rebate computed on the combined direct sales of the group.

In July 1999, the Executive Committee of Natasha was studying alternative strategies for the expansion. There are issues as to whether the company should expand its branches to some provinces or expand in Metro Manila first. There are many factors to be considered in making a decision.

Mission Gain

long term relationship with our customer-members and non-members.

Core values

1. Customer Service
2. Discipline
3. Constant Improvement
4. Respect for each other
5. Honesty

Statement of Objectives

• To formulate strategies in expanding the company To sustain Natasha’s growth even if it is no longer new to the public
• To increase the number of Natasha’s dealers

Central Problem

Would the company expand its branches to Rizal (Region IV), Cebu (Region VII), Davao (Region XI), Iloilo (Region VI), and Dagupan (Region I) or expand in Metro Manila (NCR) first? ?

Areas of Consideration

Strength

• High discounts on members and numerous incentives
• Affordability of the products due to comfortable credit terms
• Availability of high quality products
• Convenience of shopping at home

Weakness

• Difficulty in selling and delivering products as well as collecting payments
• Costly collection and delivery of products

Opportunities

• Attract customers due to instalment basis of payment
• Natasha uses Catalogues and delivers the product to the customers, it helps people to shop and buy latest
  

products despite of their busy schedules.

Threats

• Increasing number of competitors
• Calamities
• Economic crisis

Alternative Courses of Action

The company will expand its operations in Metro Manila Advantages:

• No new branches would be open Save the company for incurring additional fixed overhead expense
• It is cheaper to transport merchandise from the central warehouse to the branches •It is easier to monitor operations given their proximity to the top managers

Disadvantage: Possibility that will be no market with the increasing number of malls

The company will expand its branches in provinces Advantages:

• If the branch is near the warehouse, deliveries can be made everyday
• Big possibility of having a market due to low number of competitors

Disadvantages:

• Putting up a branch is costly
• About 20 people needs to be hired to man a branch

Recommendation

We therefore conclude that the alternative course action one is the best solution to the problem, which is to expand operation in Metro Manila. Doing this will save the company for incurring costs such as salary, administration and construction costs. Also, no location choice will be made and there will be no problem in making an organizational structure that will best meet the company’s objectives. In addition, Manila (NCR) also has the biggest population among the regions that Natasha is planning to expand, wherein most of them earn 150,000-249,999 yearly.

Despite the huge number of competitors, Natasha has a big possibility of success with the affordable, high class products they are offering, the entrepreneurial drive of Natasha that make their dealers constantly search for new markets, and with the instalment and promos they are offering.

Plan of Action

a)Conduct a meeting b)Plan the

estimated budget c)Hire expert research group to evaluate the proposal d)Acquire advertisements regarding the expansion e)Formulate new promos to attract clients

Potential Problem

a)What if the increasing competition continues? )What if the actions undertake is not effective for the said company? c)What if few people will avail the promos?

Contingency Plan

a)Train entire company on competitor profile and problem, Develop company-wide competitive intelligence system, Integrate entire staff into competitive strategy, and Develop competitive strategy brainstorming sessions. b)If the course of action does not work at all, the company can jump into other alternative courses of actions taking into account their respective advantages and disadvantages. c)More tactics must be implemented.