1. Carmen's Best ice cream faces challenges in meeting growing local demand and preparing for export due to insufficient production capacity. 2. Issues include tight schedules that reduce output, overtime work, and a need to increase production and storage. Moving operations to a PEZA-accredited facility in Laguna would allow for export. 3. Recommendations include hiring more workers, purchasing new equipment, and moving to a larger facility to increase productivity for both domestic sales and export markets in Southeast Asia.

1. CARMEN’S BEST
GOES GLOBAL
A C a s e A n a l y s i s i n O p e r a t i o n s M a n a g e m e n t
Aviles, J.G.
Leynes, V.O.
Mortel, P.A.
Ras, K.F.
Tolentino, M.Y.

2. Point of View
Paco Magsaysay
• Marketing degree at University of St.
Thomas, Houston
• Master degree in Entrepreneurship, Asian
Institute of Management
• Short course in Ice Cream Making,
Pennsylvania State University
• Most Promising Award, Pennsylvania
State University

3. Case Facts
• Established October, 2009 by Fancisco
Magsaysay
• Name after Carmen, Magsaysay’s daughter
• Produces artisanal ice cream made of finest
quality ingredients
• Priced P370 per pint, P420 per pint for
fancier flavors
About Carmen’s Best

4. Case Facts
• Initial production at Magsaysay’s residence
in Ayala Alabang Village
• First flavors were chocolate, strawberry, and
vanilla
• Used single serving gelato machine
• Started selling at AAV in 2011
• Decided to widen market by selling at
Salcedo Market in Makati and QC
Early Years of Operation

5. Case Facts
• Started supplying groceries and restaurants
• Established a management team with food
scientist, finance manager, and logistics
consultant
• Has 10 major suppliers, RFDFA supplying
20% of total production
• Two production teams, 10 workers each.
One works from 6 am to 2 pm everyday. The
other works from 12 pm to 8 pm everyday
• Ice cream produced today are delivered the
next day
Third Year of Operation

6. Case Facts
• New schedule was implemented. Two teams
work from 7 am to 3 pm. First team, TThS.
The other team, MWF.
• Freezing time reduced, 30% of client orders
were in danger of missing delivery
• Some employees started working overtime
• Local demand continues to grow to the
point that kitchen production is becoming
insufficient
Current Challenges

7. Case Facts
• Declined moving near Cash and Carry
Supermarket, Makati, because they may
need to move again
• December 2014, FDA Permit
• Getting PEZA accreditation
• Eyeing exporting to Taiwan, HK, and
Singapore
• Additional orders in the metropolis
becoming a challenge
• Needs to produce 20,400 pints to meet
export volume requirements
Current Challenges

8. Case Problem
How will Magsaysay improve the production capacity of Carmen’s
Best in order to meet its increasing local demand and prepare for its
entry in the ASEAN market?

9. In-depth Analysis

10. Supply Chain of Carmen’s Best Ice Creams

11. Current Issues in Production Capacity
• Problems encounter originated within the organization
since there were no problems stated concerning suppliers
or distributors
• Changes in operation schedules tightened the production
output
• From a fast and continuous production, operation shifted to
alternating days of processing
• To satisfy extra orders, workers sometimes had to work
overtime
• Carmen’s Best needs to increase production and storage
capacity to fulfill the growing demand in the local market
• Carmen’s Best needs to increase output to meet export
quantity required

12. Accreditations and Export Certifications
• FDA Certification was obtained on 2014 as a proof of quality and safety of their
products
• Accreditation by Philippine Economic Zone Authority (PEZA) is the first step
towards entering export market
• Firms must be accredited by PEZA to export to member countries in the ASEAN
Economic Community
 Operation should be at any PEZA Zone or Tech Parks
 PEZA-registered firms must be export oriented
 Firm must export 100% of production. In some cases,
PEZA allows domestic marketing of up to 30% of
production
 Other requirements: Project Feasibility Study,
Project Brief, Anti-graft Certificate, Board
Resolution, SEC Certificate of Registration

13. Gearing Up for Export
• In compliance with PEZA requirements, core operations should move to Techno-
free, Laguna
• A larger plant would mean nothing without bigger and more efficient
equipment.
• More workers required to operate the larger facility.
• Increase in space, equipment capacity, and labor force is expected to increase
productivity.
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15. Continuous Improvement
in Production for the Local
Market1
 Hiring additional
workers
 Selection and
Screening
 Trainings
 Purchase of equipment
2
 Approval of
Philippine
Economic Zone
Authority
Accreditation
Legal Preparation
3
Production
Preparation
 Moving in to the
PEZA-accredited
Techno-free Tech
Park at Laguna
 Initiate production
for export
 Allot 30% for
domestic
marketing

16. Conclusion and Recommendation
 Good population of Filipinos in the Southeast Asian countries
 High quality product appealing to the middle and high-end market
 An established brand
 Benefits of the ASEAN Economic Integration in exporting
 Paco Magsaysay’s willingness and ability to export
Carmen’s Best Ice Cream can be export-ready.