Macro Environment External Forces that Affect Bakery Industry Essay

Topics: Economics

Executive sum-up

Paris Baguette is a Gallic divine Korean bakeshop. which started in 1945.

and it started off as a little bakeshop. Paris Baguette is now a extremely competitory bakeshop that has 32 shops world-wide and 4 shops in Singapore. This study is to advice Paris Baguette on affairs that are associated with effectual selling for its merchandise. topographic point. publicity and monetary value. This study will speak about things like. what Marco-environment that will impact the bakeshop industry every bit good as what microenvironment that will impact our organisation.

This study will besides be explain what merchandise placement and perceptual function is and with the assistance of perceptual function it will exemplify the merchandise placement of Paris Baguette against their rivals. The recommendation for the study is to publicize Paris Baguette on telecasting or the newspaper to increase trade name consciousness. In add-on. to open more subdivisions in Singapore. as four shops is nil compared to their rivals like Bread Talk.


Paris Baguette has started in 1945. called as ‘Sang-mi-dang’ in Woongjin. Korea. They had moved Sang-mi-dang to Seoul in 1948. The president of the company. Chang Sung Hur had changed the name of the company as ‘Sam Lip General Food Company in 1968 and entered the franchise market as a general nutrient company. In 1997. they have decided to hold merchandise trade name called ‘Shany Cake’ hence. the Sam lip and Shany cake shown great impact in the staff of life industry.

In order to beef up their concern. they realized they need bakery trade name so they established Paris Croissant in 1986 and they called it as ‘Paris Baguette’ .

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which is a luxury Gallic bakeshop trade name. They have made first shop at Gwanghwamun ( Korea ) . one of the topographic point that a batch of people in Korea. They had good success. maintain spread outing the shops. and had 100 shops in Korea in 1992. They did 1st topographic point in bakeshop industry in 1997. and they maintained the first topographic point all the manner. In 2004. they decided to spread out the shops overseas and opened foremost shop in Shanghai. As a consequence. they have about 3. 200 shops in Korea entirely.

Macro Environment external forces that affect bakery industry

2. 1Demographic environment

The term ‘demography’ refers to the survey of human population on the footing of gender. age. race. income degree. denseness. instruction. household size. business. etc. Harmonizing to the informations studies that released by Singapore authorities. the population of female occupants is about equal to males. The chief mark clients of bakeshop industry are consider as females because they are most likely to hold a sweet tooth.

It means that there is still some room for betterment to pull possible clients. such as males. Besides. an aging population and worsening birth rate besides has impact on bakeshop industry. The scope in age from 5 to 35 is considered as chief mark clients in bakeshop industry. With the addition of aged and lessening of kids. consumers of bakeshop industry will be bit by bit decrease. In order to pull more possible clients. bakeshop companies may establish new merchandises that suited for males and seniors. such as salty staff of life with meat or soft staff of life. which can be easy chaw.

2. 2Political Environment

As a state. which has been crown the most business-friendly economic system all over the universe for the old 7 old ages. no 1 will doubt that Singapore authorities promote the development of company. Policy support helps with company operation. such as lessening the concern income tax- it will increase the net income of company. Singapore authorities addition the rewards revenue enhancement in order to assist hapless people. therefore. more clients will be able to afford staff of life. In add-on. policies of childbirth encouragement and in-migration besides help to increase the Numberss of consumers. Children are attract by lovely expression and sweet gustatory sensation of sweets. Europeans and Americans prefer bread alternatively of rice. and they should be habitues of bakeshops. However. these policies besides benefit other companies in bakeshop industry. and it will ensue in increasing of competitions. In order to keep the market portion. the company may cut down the monetary value of staff of life or launch more assortment of staff of life.

2. 3Economic Environment

Economic factors are consists of rising pricess. revenue enhancement. involvement rate. currency exchanges rate. depression. etc. Those factors will act upon the buying power and disbursement forms of clients. If the involvement rate increased. people would wish to salvage their money in bank alternatively of passing them. That will ensue in lessening of purchasing power. therefore. the net income of company will cut down besides. Inflation besides causes lessening of purchasing power. Inflation puts a batch of force per unit area on people. and they will diminish day-to-day disbursals. it may act upon the bakeshop industry.

Micro Environment forces that affect Paris Baguette

2. 4Competitors

In Singapore. Break Talk considered as a rival of Paris Baguette because both of these two trade names are consists of bakeshop and cafe . In comparing. Bread Talk is more celebrated and familiar than Paris Baguette because it is the local trade name and it is plenty of subdivisions. There are merely four mercantile establishments of Paris Baguette. but more than 25 subdivisions of Bread Talk in Singapore. The advantages of Paris Baguette are ‘delicacy’ and assortment of merchandises. Delicate visual aspects of decorate and merchandises attract many clients. The advantages of Bread Talk are it’s lower monetary value and publicities. To compare these two trade names. Paris Baguette is more suited for yuppies. but Bread Talk is suited for ordinary household.

2. 5Customers

The clients positioning of Paris Baguette: kids. twosomes and 15 to 35-year-old females. Merchandises of Paris Baguette are more expensive than other general bakeshop trade names. therefore. consumers of Paris Baguette should be good pay. Customers prefer cafe of Paris Baguette. so they frequented braches in the afternoon. particularly during the weekends.

Macro environment forces that affect Paris Baguette

Two of the Macro environment. which have affect Paris Baguette are the Economic environment and social-cultural environment. The economic environment affected the Paris Baguette franchises. which the production costs increased due to the monetary value of the oil and the grain increased. All the franchises have to pay more in order to buy the ingredients. Besides. Paris Baguette in the American and China markets have faced some unsure economic failure. This has cause rather a large impact to Paris Baguette. “A weak currency is the mark of a weak economic system. and a weak economic system leads to a weak state. ” ( Perot. N. D ) .

In add-on. the social-cultural environment. which affect Paris Baguette have to cognize the different cultural nutrient gustatory sensation of the chosen state. which mean they have to happen out what type of merchandises can increase the involvement and Paris Baguette have to collaborate with it by making the merchandise the people like. Besides. for the aging people and adult female will give more attending to their ain wellness and they prefer more on organic nutrient. In order to take a bigger market. Paris Baguette has to bring forth more organic and healthy merchandises due to the healthy diet flow.

Merchandise Positioning.

Merchandise placement is one of marketing techniques that promote merchandises in the best manner to aim audiences. The most of import thing is to purchase the merchandise. It is rather similar with market cleavage as the merchandise placement is made of making the message and involves the symbol and use. which conclude show and packaging. In Paris baguette. they used 5methods for the merchandise placement. They are ‘threat of new entrants ( excessively much capital is non required for fall ining the bakeshop franchise market ) ’ . ‘bargaining power of providers ( the natural stuff is of import for them in bakeshop industry and the stuffs like rice and flour ) ’ . ‘threat of replacement merchandises ( many other replacement merchandises are exist such as flour based nutrient. instant nutrient. etc.

For illustration. Starbucks is one of cafe that makes high net income with utility merchandises ) ’ . ‘bargaining power of clients ( They don’t have trouble to exchange buying mercantile establishments because of standardised bakeshop merchandises ) ’ and ‘competitive competition within an industry ( there is intense competition in the market among other trade names because of impregnation. There does non hold many houses within industry but large trade names like Tour les Jour exist. There besides have high issue barriers and difficult to distinguish the strategic for each house. ) ’ .

Perceptual function

From the image above. we can see that Paris Baguettes ( PB ) and Baker & A ; Cook ( B & A ; C ) has the high monetary value and high quality compared to Sunshine Bakery ( SB ) . It is because PB and B & A ; C uses really good quality and high cost for the ingredients compared to SB. B & A ; C is selling merchandises somewhat higher than PB is because of the company’s ordinance. Paris Baguette use the merchandise placement scheme. which is ‘positioning by price/quality’ . This is because they want to do certain their client satisfy with their merchandises and can devour their merchandise is in high quality in other words mean the gustatory sensation of the staff of life. the freshness and the brittleness of the staff of life. However. in order to bring forth a high quality merchandise. they have to utilize high quality natural stuffs to bring forth their merchandises such as the flour. butter. grain and other. which mean their merchandises are in high quality and the monetary value is
somewhat higher. “The quality of a leader is reflected in the criterions they set for themselves. ” ( Kroc. 1984 )

Marketing research

The primary selling research technique that I would urge Paris Baguette to utilize for roll uping information related to client satisfaction is the study method. The study method is by far the most popular of all the research method. Survey method is a list of inquiries that ask persons about their penchants. attitudes towards our merchandise and purchasing behaviors. We would necessitate to make the questionnaire that will enter the informations. Example of the study inquiry will be:

What is the first thing that comes into your head when you think of Paris baguette? Do you bask our choice of staff of life?

Which one of our merchandise make you wish best?
How can we better on our merchandise?
Are our monetary values reasonable?
Are our staffs friendly?
Is our subdivision location convenient for you?
What new merchandise would you like to seek?
What is your age group?


These inquiries will assist Paris Baguette better on their merchandise and happen out what their clients thinks about the organisation and what new merchandises they would wish to see from Paris baguette. One determination that I have found from the selling research is that our stores location is inconvenient for people that are hotfooting. In add-on. we open merely at 10a. m. which is after the forenoon peak hr. Paris Baguette can do our shops more convenient for the working category by seting them near the MRT Stationss and opening our shops before the forenoon peak hr. By opening our shops during peak hr we can pull people who have non ate their breakfast as they are hotfooting for work. and by seting our shops near an MRT. It would do it much more convenient for people to come to our shops to purchase our merchandise particularly those who are hotfooting.

Marketing Mix Strategies of Paris Baguette

Marketing mix consists on the 4Ps. which are merchandise. monetary value. publicity and topographic point. We are traveling to analyze the selling mix the Paris Baguette bakeshop. In first topographic point. we can see that the Paris Baguette is a bakeshop with a high assortment of merchandises. The Paris Baguette supplies fresh bakeshop merchandises in over 3000 locations worldwide. Their merchandises are different for each state depending on the civilization and the people of each state. They do non hold the same merchandises In United States and In Singapore. for illustration. This is because people from different states have different penchants of gustatory sensation. However. there are some common merchandises in all their subdivisions. For illustration. the most common merchandises are the types of staff of life. the pastries and pie. the bars. sweets and sandwiches and drinks.

They besides sell other type of merchandises like cups of tea. Talking about the monetary value. the monetary value in the Paris Baguette is equal to the quality of the merchandise and the cost of purchase. The Paris Baguette keeps low-cost monetary values in order to be accessible for more people to pull more clients. Of class they have to analyze the rivals monetary values and offers before adjust the concluding monetary value of their merchandises. Besides finding the demand of each merchandise and the estimating costs. If a merchandise has a high demand. the cost would increase. For illustration. a piece of bar would be around $ 3. 95. Talking about the publicity. the Paris Baguette is a bakeshop with tonss of publicities. They use two different ways of publicity to pull people. The first manner is to make advertizements about their merchandises with nice images and an seemingly household friendly topographic point.

The 2nd manner is making gross revenues publicity. For illustration. purchase one sweet and acquire the 2nd one free. or making breakfast offers like a cup of java and a sandwich for $ 3. 50. They use this two ways for publicity. Finally. the topographic point. The Paris Baguette focuses ever in acquiring subdivisions in the Centre of the metropoliss. They are non interested in acquiring subdivisions in little towns or topographic points with non excessively much people. This is because they want a high norm of people per twenty-four hours and this can accomplish merely in the Centre of the metropoliss and specific topographic points. For illustration. in Singapore they have a large subdivision in Orchard. which is the chief route in Singapore.

Marketing Mix

In my sentiment. there are a few points that Paris Baguette could implement in the hereafter. This can be focus on the publicity events. In my sentiment. the Paris Baguette could implement rather a batch their clients by making some bar and bread events. Paris Baguette can pull more clients. while advancing their merchandises. This could be done by making some events each twelvemonth rent a topographic point in a shopping promenade and put up a phase in a big crowd topographic points.

Meanwhile. while advancing their merchandises. Paris Baguette can give out their new merchandises with free of charge. This would be an betterment for their celebrity. This because every bit long as it is free. when people try their bakeshop merchandises and it taste good. people will purchase the merchandises. These events will pull people from everyplace. which mean Paris Baguette will hold more clients purchasing their merchandises and it will increase their net income. “Profit in concern comes from repetition clients. clients that boast about your undertaking or service. and that conveying friends with them. ” ( Edwards. 1993 )


In Singapore. Bread Talk’s celebrity surpasses Paris Baguette. Thus. Paris Baguette may publicize on Television or newspaper in order to additions trade name consciousness. Besides. they besides need to spread out more subdivisions all about Singapore in every individual shopping promenades to increase competitory. This is because are merely four subdivisions of Paris Baguette. which is far less than Numberss of subdivisions of Bread Talk and other bakeshop companies.


‘Sang myocardial infarction dang’ was a little bakeshop which began in 1945. After some betterment. Paris Baguette have been start up and their concern expand with a rapid velocity. Paris Baguette is a mature domestic franchise bakeshop with a high per centum of portion footings and their stores have already franchised to worldwide. Paris Baguette have maintained their high place for a period. This is because they have did their Micro and Macro environmental factors. which will impact their concern. and they try to get the better of it. Besides. Paris Baguette besides did probe of its rivals. in order to cognize more about its rivals. After the probe have done. they try to compare it to their ain companies by utilizing a perceptual function construct. which can assist them to cognize their ain scope with its rivals.

Furthermore. to cognize how to derive more clients. Paris baguette choose a study method by inquiring the random passers and to cognize more about. which bakeshop merchandises do they prefer or like. In add-on. Paris baguette known as a bakeshop which more on merchandise and monetary value. which mean they sell high quality merchandises. Therefore. they will take a high quality of natural ingredients to bring forth their merchandises and put up a higher monetary value but sensible. Nevertheless. Paris Baguette besides choose more crowded country to put up their store to allow more people notice their store and purchase their merchandises. Besides. in order to pull client. Paris Baguette besides did some publicities for theirs merchandises such as the particular of the twenty-four hours for the merchandises.


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Macro Environment External Forces that Affect Bakery Industry Essay. (2017, Aug 12). Retrieved from

Macro Environment External Forces that Affect Bakery Industry Essay
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