Assignment for Import and Export Business, Exercises of International Business

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ID number

300334284: Ngô Thị Thu Trang

300322749: Trần Thanh Thư

300334259: Nguyễn Bích Hải

300343985: Trương Đức

MARK 101

ASSIGNMENT

TABLE OS CONTENTS

1. Executive summary
2. Company description
3. Strategic focus and plan  Mission  Goal  Competitive advantage
4. Situation Analysis  SWOT analysis  External analysis  3Cs analysis
5. Market product focus  Product objectives  Target market  Points of difference  Positioning
6. Market program  Product strategy  Price strategy  Promotion strategy  Place ( Distribution ) strategy
7. Financial data and projections  Past sales revenue  Five- year projections
8. Organization
9. Implementation plan
10. Evaluation and control

quality, efficiency, contributed to the economic development of the sector, local and national. SABECO brand has maintained progressively the customer confidence and meet 35% market share of the consumer. In many years, SABECO receive merit and emulation flags of the Prime Minister as well as the merit of the block grant in corporate sectors and the labor unions. SABECO has accounted for about 35% of domestic market share, with volume growth of beer sector (by the Ministry of Industry forecasts) about 15% per year and the growth of beer sector industry is better than output the overall growth of industry, reaching over 20% per year during 2004-

IV. Strategy analysis

1. External factor Environmental forces which include social, economic, technology, legal and political has a significant effect on the development of company. Acknowledge these factors will help business recognize the strength as well as the weakness that can occur during the time running a business. Social factor. Population and demographic such as age, gender, ethnicity, income and occupation affect significantly on consumption of alcohol beverage especially beer industry. Cheer for Vietnam ,Vietnam represent a prime market for beer producers. Unlike other countries, the Vietnam have a tradition of drinking beer and express a strong loyalty to their local brands, especially Saigon beer. In addition, Vietnam is the country which has the large population. In 2014, Vietnam has a total population of 85 million. In there, the rate of young people is high, 85 percentage of Vietnam's population are Boomers which have high demand of beer consumption. Moreover, Vietnamese is affect much on traditional, they not only drink beer at the Tet holiday, celebration or party but also drink beer in the usual days, so the beer industry in Vietnam has more opportunity to develop. However, because of the popular foreign products in Vietnam, for the high society whose income is high, they prefer foreign products to domestic products. Therefore, it is difficult for the domestic business compete with foreign brands. Economic factor 2007, Vietnam joined WTO that will make Vietnam become well known and gain high appreciate. Beside, the pressure of integration affects to the economic policies, and state management and make operation more fluent. In addition, the international trade is more easier because of the elimination of unreasonable barriers which restrict the growth of businesses. Moreover, joining WTO contributes to the clean apparatus State and improve the implementation of the economic policy in Vietnam efficiently to make the system transparent policies. These factors will facilitate the attraction of foreign investment in the sector. Thanks to efforts for steady growth and effective investment strategies, SABECO is now in top three of beers maker in whole southeast Asia and is the 21st^ largest beer producer in whole world. In addition, Vietnam is the country which has high total gross domestic product around 8% in recent years. Although it experienced global recession

in 2008 and 2009, it is forecasted increase the grow rate in next 10 years. Moreover, according to Vietnam general department, from 2013 the growth rate in Vietnam will continuously increase with fast speed. It is seem as a opportunity for SABECO to develop its business. Whereas, Vietnam has high inflation rate, it leads to the cost of production is high so that it causes many difficulties for SABECO company and whole beer industry. Technology factor. The development of science - technology has created the modern machinery, materials richer and higher quality. For the SABECO company, it uses the HACCP- hazard analysis critical control point system- to indentify the poison in nourishment. The company has successfully implemented quality management system under ISO 9001 – 2008, ISO 1400 standards at all branches across the country. Political and legal To protect the domestic businesses, the Vietnam's government has applies some policies and legal which will positive or negative effect on beer producers. Encouraging foreign investment policy which will bring more condition for the foreign company invest in beer industry. Foreign Investment Law and Law on Promotion of Domestic Investment create favorable condition for all economic sectors invest in beer industry. Decree No. 40/2008 / governmental decree provides for the manufacture and sales of alcohol, which provide the basis standard for improving and controlling product quality and strengthen control on investments, limiting the widespread development of wine production facility. Therefore, the no named beer producers whose production cannot reach the basic standards cannot survive in the market. However, according to Circular No. 12/ provides for advertising, promotion, place Alcohol business, Regulation on promotional advertising costs are 10% of sales which cause difficult for SABECO promote their product. In addition, the policies on preventing of alcohol abuse and that government may apply in the future, accompanied by strengthening propaganda and education on the harmful effects of alcohol which can reduce the demand of beer. Environmental factor Vietnam is a area which have tropical climate and abundant mineral water source. This is really a source of precious raw materials, creating favorable conditions for the development of beer industry. Moreover, with hot and dry climate, the demand for beer in Vietnam is huge. However, the natural conditions of Vietnam was not favorable for the development of a number of raw materials. Especially in the brewing industry, the main raw material barley and Houblon but both types are not suitable for the climatic conditions Vietnam.

3. SWOT analysis Opportunity Population is over than 80 million people and tropical weather around year and Viet Nam is a potential fully market. Saigon is a band's beer which is famous of Viet Nam and is enjoyed by customers at Viet Nam and foreigners. In 1995, Viet Nam joined WTO so Viet Nam has a lot of opportunities for export goods. Therefore, Saigon's beer also has

target market of the company is to exploit the Southern market and use it as a base to penetrate other markets. Mainly customers of the company is the group of rather average income, between the ages of 29 and 49, who is the businessmen, officials and civil servants frequently traded ... High-income people often use high- quality products to confirm their position. Also for the people who have average incomes, they can choose the goods for their needs sensibly such as a bottle of beer or a can of beer. This product has a good quantity, reasonable prices that can satisfy most customer needs.  Points of difference For example: Saigon Export  Saigon Export is produced by traditional fermentation methods in a long day to create a strong flavor familiarity.  Saigon Export does not cause hydrophilic and headaches after drinking.  Saigon Export was produced and widely distributed across the country, especially popular from the Central to the Southern.  Saigon Export exported to over 18 countries around the world, and especially conquering the fastidious markets such as Japan, USA, Australia, Singapore etc.  Positioning

Export Beer 355 (Saigon Red) and Beer 333 are two products that have the highest consumption in Vietnam. Particularly, Saigon Export accounted 28.1% in the market share in 36 major cities and 42% in HCM city. VI - Marketing programme: There are four detailed marketing elements of Saigon Export beer marketing programme below here. Remember that SABECO is applying the market development strategy in which SABECO is launching and developing a Saigon Export beer to the existing market of Vietnam and exporting to foreign markets.

1. Product strategy: According to the current result of the survey about the reasons causing traffic accidents, there was 45% of people answered that they were drunk because of the alcohol concentration in beers they drunk were too high. The research also shows that the number of diseases caused by high-alcohol concentration beers is increasing. More seriously, this situation happens in urban area such as big city like HCM. HN, …, in which the number of accidents caused by it is four times higher than the number in rural area. Therefore, launching and developing Saigon Export beer, which has low alcohol concentration but still sustains the special flavour of Vietnamese beer, will create the unique quality on SABECO product line and the attraction on customers who want to have a fun party and a safe night ride after all. Still providing good nutrition, SABECO creates the points of difference in beer market by reduce the alcohol concentration to 4,5% ( other beer is 5,9%) in order to help the customers, who have habits of drinking beer to reduce stress or just to make their party more exciting but have no worry on getting drunk. For most of Vietnamese people and foreigners who want to taste a real Vietnamese favour beer, SABECO brings customers the Asian lifestyles, the understanding without levels or standards

different quarter of the year. In addition, SABECO Company should also combine the sales promotion by offering 10% discount, the most favourite sales promotion base on the survey, to create the first impression for customer.

4. Place strategy: SABECO product is distributed in its present market through wide distribution of many distributors and over one hundred thousand outlets in 64 provinces across the country. Shops selling Saigon Export are allocated not only in most of cities in Vietnam such as Hanoi, Da Nang and Ho Chi Minh but also in foreign countries such as Canada, United Stated, Russia, etc. It is recommended that SABECO should have more warehouses for different location i.e. in each city or province to reduce the distribution cost. As beer is a fast moving consumer goods, beer is sold in many places such as convenient shop, bars, supermarkets, markets, etc. SABECO may apply the intensive pattern of distribution. Until now, SABECO already has more than 1,200 distribution channels throughout Vietnam. New distribution network has been expanded; covering the whole country, with the direct involvement of the customer to the product can reach the consumer faster and most convenient. VII. Historically, SABECO is a company which grows strongly and was one of those leading brands in Viet Nam. In 1997, average income of SABECO's company was 3,2 million/person/month, and increasing significantly in 2006 was 6,0 million/person/month. Besides that, the growth rate in every year is very high from 17 percent to 20 percent. We can see the chart that the beer market of SABECO' s company in Viet Nam reached a peak at 45,04 % in 2010 and in 2011 SABECO's company also peaked at 47,50%. This could be because they have a good strategy about advertisement, medium or satisfy of customer about products, services, and so forth.

(http://ftp2.ssi.com.vn/Customers/Research/2012/Report%20sent%20out/ Sabeco_Habeco%20Company%20Update_Still%20attractive%20despite %202011%20low%20performance_29.06.2012_SSIResearch.pdf ) The chart shows that the profit and loss of SABECO's company between 2009 and 2011. The gross profit rate of each year increased but the profit in 2010 was better than profit in 2011. This is understandable because the demand of customer declined and the inflation rate of Viet Nam increased sharply so the net income rate of SABECO's company decreased between 2,771 billion and 2,344 billion. In 2011, the sales rate rose by 11,2%, and the selling price also increased by 1,55%. In addition, the gross profit margin rate declined from 24,75% in 2010 to 21,1% in 2011. This also was one of some strategies of company to rise sales, attract new customers, and develops this brand other areas.

X. Recommendation: SABECO will pursue “Go around the world” strategy by expanding to worldwide. Its target segments to all customers who like low alcohol concentration beer for their health. The IM plan will support the overall marketing plan by capitalizing on:

• Reminder advertising should be taken for Saigon Export and other current beer produced by SABECO what kind of promotion is being used, and other information.
• New products: Saigon export cans and Saigon export plastic bottle.
• Sales promotions, according to sports trend like soccer, ... The mix of IM tools includes website, email, social network, search engine, video advertising. The expected benefits of this campaign will be:
• Customer service: understand more about customer experience, receive positive feedback
• Advertisement: become the best of traditional beer
• Finance: the revenue reach 10.000.000.000 VND, online sales at about 400.000.