Report on trip to Sto Tomas Pampanga and further researches with Mr. Dong Lacquian

This is a report on my fact finding mission and negotiation with Mr. Dong Lacquian whom I met at Teresa about 2 months ago while biking

1.  On business entity of Mr. Dong

He will be using in the meantime, the business name of his pamangkin Abner Lacquian.   However, this office advised him, if ever we will deal long time (and possibly big time) to secure DTI permit for single prop, and open his own bank account.  He was advised to take good care of his health and stop smoking to lengthen his life span

He said he is not just an agent because he represents a number of relatives who are casket and equipment manufacturers (The latest one was Mr. Rodolfo Teodoro who was one of the earliest metal casket maker)

He said, when I told him we will constantly canvass for other suppliers that he will give constantly the best prices and he will guarantee that

2.  On the products and pricing

    1.  That I did a times 10 on cost.  It is good because it is easier to give a discount (from a high price) than to up and existing price  Midrange it could be just x 7 or 8 as in metal casket at between 40t to 90t,  

        x 10 pricing applies to low end and high end.

   2.  The millions charged in the price list made for stainless steel and solid bronze is not applicable to other areas (maybe for Class A in MM).   Between P500t to P800t would be the ceiling

   3.  He gave me pricing for low end and midrange to compete with SPLP;

     Senior Metal  with Light                    -  P7,000

     Junior Metal with LIght                     -    6,000

 to compete with St Claire  -      44t

                        St Bernadette -  54t

                        St Anne           - 79t

I was shown the plant of SPLP at Barrio Ataol Sto Tomas.  There is another one at Minalin.  It looks like the other workshops/plants of other 200 or so Ataol makers of Sto Tomas Pampanga.

The low end casket (indulgencia)

Flat stucco  -  P2,000 for the indigent good for P10t to 12t package; fits the govt funeral assistance, and SSS

Mr. Dong will include a 50 cm infant casket for every delivery to give free service to all infants below 4 years old

4.  The strategy of a MP company is to give misleading prices for the Plan.  Customers who require service  do not have  have expert knowledge of the caskets can be mislead into believing that the casket being presented to them is as per plan, but actually is lower priced and will eventually upgrade to the right casket at a much higher price sometimes 100% higher!!!

5. Strategy:

    1.  Display the nice but higher priced casket in front, and lower priced at the back of the display area (as in supermarkets -  the price leader is at the back)  The customer will eventually go back to the front -  the nice looking casket

    2.  The pricing and models for the pre need (memorial plan) is very much different to the at need. At need prices are higher (sometimes 100% ) over the MP caskets.

       The casket with ROP are different from casket without ROP.

    3.  We do not have to stock with 40t to 70t casket;  we can order as needed. The oversized casket are also available upon request.

       However the karuwahe can accommodate oversized caskets.

      Oversized caskets are defined to be longer than 2.10 meters or wider than 70 cm.

   4.  If we recruit managers, at the start, it should be minimal, and request that they help us at the start.  P17t looks at huge sum for him.  He says he can run our chapel at P15t in the beginning for set up in one month.

   5.  It is challenge for him to set our HAMP funeral service.  It looks very promising.

3.  Cap ex:

   1. Quotation for the remodelling of MB in Morong:

       SP between Morong and HGGMP   -  P50t

       Cost of remodelling:

       To flower car                  -  P180t

       To flower car and funeral hearse   -  P200t

       The amount covers:

       labor and material

      change engine to Toyota RF turbo, 

      body repair

      paint

     under chasssis

     set up car stereo (quote on file)

  2.  Business opportunity for equipment rental

     

      1.   Karuwahe

      When we buy a karuwahe at P160t.  we can rent to HNS or other funeral homes at a much lower price:

     Total rental of karuwahe is P28t which includes horse and transport.

     The rental for karuwahe alone could be P13t as the horse costs P15t.

     Karuwahe rental at Pampanga lowes is P6t.   It could be 10t lowest nearby

     2.  Rolls Royce costs P600t to build, but it could be rented out at P10t  (it costs P20t if we hire from Pampanga)

     3.  Other equipment and terms;

         1.  FB L300 at P200t is sagad but he can buy one at lower than P200t

         2.  Exp and FI50 is 50% downpayment  and 6 mos pdc on balance.  However he will give a 3% discount if balance is paid on delivery

        3.  Casket rack, atrille, casket dolly lights and guess book stand , mass card holder are cash

        4.  Casket inventory will be from the bottom wood up to Senior Metal Flexi only, paid in cash in initial, but 60 days thereafter with PDC for subsequent delivery.   We do not have to stack with so many high priced inventory

        5. For karuwahe, he will require 30% down payment for the 3, make the first one after 15 working days, and thereafter we pay the balance for the first one, he makes the 2nd one, get the balance for the 2nd one,  and he will make the third one and then get the full payment.

5.  Terms for caskets:

    OMS and OMB -  no meaning except that they refer to wooden casket

   with LIghts -   with moving LED lights that are attractive.  They are more expensive by as much as P5t

    single top -   single cover

    double top -   double cover  (out moded all ready)

    full glass -  whole body is visible

   bubble top - glass is curved and so with the cover.  These are more expensive.

   Low priced handles are imported from Macau

  High priced handles are imported from USA.  There are no locally made handles yet

Jorge  S

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