01 MINH PHU SEAFOOD CORPORATION ENTRIES THE NEW MARKET SWITZERLAND

Group MINH PHU SEAFOOD CORPORATION ENTRIES THE NEW MARKET - SWITZERLAND Table of contents I Introduction II Company background III Reasons for finding a new foreign IV PESTEL analysis: Switzerland V The method of entry VI Conclusion market I INTRODUCTION Covid-19 produced adverse effects on the economy and inhabitants’ life The economy is in a severe crisis, the activities of international trade are reduced, and the food supply chain is interrupted while demand for food is increasing This is both an opportunity and a challenge for enterprises that want to develop the food export industry Vietnam has advantages in production and aquaculture such as shrimp, pangasius, tuna, squid Although the Covid19 has caused the export industry to be severely affected, our country's seafood export turnover last year (2021) had impressive growth, reaching nearly billion USD, up 5.7% compared to 2020 This is the motivation for enterprises to exploit new markets in the seafood export industry Switzerland is a landlocked country The disease and social distancing cause this country to lack food, including seafood Besides, the market in Switzerland is a new market with great potential for exploitation From these factors, our team chose Minh Phu Co., Ltd with a plan to export seafood to Switzerland II COMPANY BACKGROUND Minh Phu company is a global leader in the " processing and export of shrimp products Minh Phu's products are currently present in over 50 countries and territories Started from a private enterprise supplying seafood with a modest capital of more than 100 million, was established in the cape of Ca Mau in 1992 After 30 years of construction and development, Minh Phu has come to the present time has become a strong seafood enterprise with a market capitalization of more than 10,000 billion VND In 2015, Minh Phu was honored to be ranked highest among the world's largest shrimp exporters and processors Undercurrent News seafood magazine Minh Phu's main product is shrimp production, in which Black Tiger Shrimp and Vannamei whiteleg shrimp are two key products that make up the group's reputation Minh Phu's main export markets are the US, Japan, EU These tenses are creating a lot favorable for the export of the main product is Shrimp by Minh Phu by III Reasons for finding a new foreign market By successfully establishing your business in the new EXPOSE BRAND market, you not only attract new customers but nourish your company's reputation and gain greater credibility Businesses have exhausted growth opportunities in old INCREASE REVENUE POTENTIAL markets so they turn to find a new market to help grow their business For many companies, the international expansion offers a chance to explore markets and gain access to millions of customers, thus increasing sales GAIN COMPETITIVE ADVANTAGE Going to market before your competitors do, allowing you to get out of a saturated market and accessing to new customers and in a market where your competitors not operate Giving the opportunity to not only sell your current product or service to a new customer base but also to invest and HAVE NEW CUSTOMER BASE introducing new products/services With a much broader customer base, you can generate more business and increase sales IV PESTEL analysis: Switzerland Political analysis Switzerland is a federal republic consisting of 26 cantons (federated states) with the states being able to enjoy a fair amount of decentralization Executive power is exercised by the government and the federal administration and is not concentrated on any one person On the other hand, whenever we mention the politics of Switzerland, we must concentrate on the main points as follows: Governance indicators Switzerland’s governance indicators are good Especially, the voice and accountability index is always at the top of Europe For that indicator, we provide data for Switzerland from 2013 to 2020 The average value for Switzerland during that period was 1.56 points with a minimum of 1.5 points in 2019 and a maximum of 1.63 points in 2013 The latest value from 2020 is 1.54 points Diagram 1.1: The index for Voice and Accountability of Switzerland from 2013 to 2020 Switzerland is also proud to be ranked 3rd in the ranking voice and accountability index in Europe in 2020 Switzerland has preserved its traditions of direct democracy, where citizens are involved in the framing of important legislation The country also performs well in terms of regulatory quality and implementing the rule of law IV PESTEL analysis: Switzerland Political stability The political situation in the country has stabilized It is one of the safest countries in the world While some of its neighboring countries have recently gone through political upheavals, Switzerland remains a politically stable country with the vast majority of voters being faithful to their parties However, the most concerning issue to voters is the growing discrimination against Muslims An Amnesty International report concluded that Islamic religious symbols like headscarves, beards, and minarets were viewed with hostility and that Muslims were discriminated against in employment and education According to the President of the Swiss Federal Commission on Racism, the country's anti-discrimination laws have many gaps This is only going to increase the growing anti-Muslim sentiment Relationship with the EU and other countries in the world Switzerland is a full member of the United Nations It is also a member of the World Bank and the International Monetary Fund (IMF) It is not a member of the European Union or European Economic Area However, it takes part in the European Single Market and Schengen Agreement Therefore, Swiss nationals are free to live and work in the EU It has also earned a good reputation for its long-standing neutrality and contributions to global peacekeeping activities However, its relations with the EU are increasingly fragile The largest party in the country is strongly opposed to EU membership and integration Nowadays, Switzerland promotes expanding its relations with non - European states According to the central bank, Switzerland witnessed increased demand for exports from nonEuropean states in 2020, especially from Chile (33.9% increase in exports over 2019), China (19.4%), Hong Kong (19.2%), India (15.4%), Taiwan (14.5%), and Malaysia (12.2%) Moreover, Switzerland and Vietnam signed on October 22nd, 2021, an agreement on the implementation of the Trade Policy and Export Promotion (Swiss Trade) project IV PESTEL analysis: Switzerland Economical analysis GDP Switzerland ranks as one of the world’s most competitive economies, with a real GDP of around 752.25 billion US dollars in 2020 and it is expected to reach 795.00 USD Billion by the end of 2021, according to official data from the World Bank The GDP value of Switzerland Diagram 2.1: The Gross Domestic Product (GDP) in Switzerland from 2012 to 2020 represents 0.67 percent of the world economy After that, the GDP figure in 2021 was $812,552 billion, Switzerland is number 20 in the ranking of GDP of the 196 countries The absolute value of GDP in Switzerland rose by $ 17,552 billion with respect to 2020 Capital market The Swiss capital market is known for its efficiency, which helped the country to become a leading financial center There are no restrictions on foreign currency transactions and residents as well as non-residents are free to make "forward transactions" at prevailing market rates The legal system is also conducive to the transfer of proceeds from export earnings and the repatriation of invested capital is unrestricted Furthermore, the Swiss credit market does not distinguish between Swiss and foreign investors, and a variety of credit instruments are available to private investors Inflation rate At the end of October 2021, annual inflation in Switzerland reached 1.2% after rising 0.3% over the month, according to the Federal Statistical Office This is the highest the annual rate has been since August 2018 when it reached 1.2% Now, in April of 2022, it inched up to 2.5% In line market forecasts, mainly boosted by faster rises in prices of transport, housing, and energy Meanwhile, health prices fell by 0.5%, at the same pace as in the previous month Higher inflation can lead to higher interest rates and make it difficult for investors IV PESTEL analysis: Switzerland Social The current population of Switzerland is more than 8.7 million people (in 2022) and is ranked 101st in the world in the ranking of the population of countries and territories The average life and Swiss men and women are 81 and 85 years old With 23% of immigrants, Switzerland is a country with a high and growing percentage of immigrants Besides, Switzerland is also a multicultural country and uses many languages in the world such as Germany, France, and Italy Therefore, the use of diverse cuisines in the world in this market tends to increase Switzerland has a thriving tourism industry, each year welcoming about 63 million international visitors, so the development of international restaurant and hotel chains contributes to an increase in seafood consumption Currently, Swiss consumers are increasingly leaning towards the view that eating seafood is healthier than eating meat In recent years, seafood consumption in Switzerland has increased by 25%, reaching 9.1kg/person/year Shrimp is an important aquatic species, present in many Swiss dishes Each year, the country consumes about 8,200 tons of shrimp, entirely from imports Despite the low population, Switzerland's GDP per capita is 86,602 USD/person in 2020 and is among the highest in the world (top 3) With cities ranked top quality of life and high cost of living So consumers here can afford to pay a lot for quality products Switzerland is a market that requires very high quality imported products Exporting goods to Switzerland is also subject to a very strict licensing regime to ensure health and food safety requirements All food sold in Switzerland must comply with European and Swiss food labeling regulations Consumers in this country are very interested in eco-labels and are willing to pay extra if the product meets health and environmental requirements IV PESTEL analysis: Switzerland Technological The Swiss economy is very stable, developed and highly technology-oriented This market has strict quality control of food safety and hygiene, and a quick alert system Strong collaboration between academic and business sectors along with high R&D expenditure have enabled the country to translate its research findings to marketable products and processes The country also provides strong intellectual property protection Switzerland has a high rate of patenting at 242.2 per million inhabitants This healthy innovative capacity is evident in the high number of patents granted (1,865) to Switzerland by the US Patent and Trademark Office in 2011 Environment Switzerland is one of the most beautiful countries in the world However, Switzerland faces some environmental challenges as well For instance, it can be badly affected by climate change in the future Likewise, there is a huge pressure on its natural resources Many people are also concerned about air and water pollution in the country Switzerland is facing environmental issues like water pollution, scarce natural resources, and air pollution They could impact the country’s environment Switzerland's environment sudden impact of temperature rises on the population will arrive at the hilly areas and it covers the ice and snow Last few years temperatures of Switzerland year by year increasing Earthquakes and floods affect the human settlement The agriculture sector was also affected by the earthquake Climate change is the result both activities economically and social Legal The Swiss legal framework has relied on a highly developed system in which laws are welldefined and the judiciary is independent of any branch of government The federal government has adopted a relaxed attitude of non-interference toward foreign investment, allowing the 26 cantons to set their own policies Taxation IV PESTEL analysis: Switzerland Individual income tax: the tax system is complicated because the cantons and the communes levy their own taxes The top federal income tax rate is 11.5%, but the combined individual income tax rate (federal and sub-federal) can be as high as 42.3% Corporate tax: The federal tax rate is 8.5%, while cantonal rates are mostly progressive and usually depend on the company’s profit, and vary between 12% and 22% VAT is levied at the federal level on the sale of goods and services supplied in or imported to Switzerland The standard tax rate has been 8% since January 2011 However, a special rate of 3.8% applies to accommodation and directly related supplemental services, and a reduced rate of 2.5% applies to certain other goods and services, including foodstuffs, agricultural products(meats, cereals, plants, seed, and flowers), medicine and drugs, newspapers, magazines, books and other printed materials, and TV and radio services Trade regulations: Swiss duties are "specific" rather than "ad valorem" (according to value) Customs duty varies according to the item imported; the Swiss customs tariff uses the harmonized system for the classification of goods Customs duties are levied per 100kg of gross weight, unless another method of calculation is specified in the tariff Although Switzerland generally meets its commitments under World Trade Organization and bilateral agreements, there are strict packaging and labeling requirements that exporters must adhere to In addition, there are significant tariff and quota barriers for many agricultural products V The method of entry Minh Phu Seafood exports to the EU market increased by 13.9% compared to the same period in 2019 (data in 2020), which initially marked the spectacular development of Minh Phu Seafood when entering the fastidious market With this success, Minh Phu can completely conduct exports to Switzerland - a strict market with similarities with the EU market Regarding Vietnam-Switzerland relations, Ambassador Le Linh Lan assessed that Switzerland is an important trading partner and the sixth largest European investor in Vietnam with a total investment of about billion USD, focusing on the processing, manufacturing and electricity industries This is also a great motivation for Minh Phu to export directly to Switzerland Advantage Shortcoming The company will save a lot of costs to pay for The gap between buyers and sellers is very intermediaries Instead of spending time large, so when it comes to buying and waiting for the intermediary to provide selling, there can be many unforeseen risks information the For example, the risk occurs because the information is accurate or not, the company company is not really knowledgeable about can completely research the market itself and the product, partners, market find out the information, especially, it is a In direct import and export, it is also noted market adjacent to the market it is familiar that the risk is very high if the company is with not knowledgeable about the partner and the The companycan accurately and quickly grasp market Because it is possible that in the the change in customer needs and tastes domestic environment these factors are Thereby providing solutions and strategies to favorable and successful, but not necessarily adapt its products and business activities successful in foreign markets The company can control the price and quality The cost is expensive so it is only done of their products in foreign markets And when there are enough large quantities of promptly goods without take knowing countermeasures if when a problem occurs This helps businesses to build and maintain their brand in foreign markets 01 V The method of entry In summary, Minh Phu Seafood is a business with a team of experienced employees in international trade relations, knowledgeable about import and export operations and processes, fluent in the language, customs, domestic and international laws accumulated from previous export deals Moreover, this is also a large company that is willing to invest in research and marketing, thoroughly learn about products, partners and markets Therefore, Minh Phu can completely choose to export directly to Switzerland VI Conclusion With the goal of recovering from the Covid19 and developing the economy of Vietnam, the enterprises are always looking for new directions for themselves The international trade is expanding, creating opportunities for businesses to expand operations in new markets To improve operational efficiency in those new markets, the role market research is very important Our team chose Minh Phu Co., Ltd and planned a seafood export deal to Switzerland - a potential new market We the report with key points: Method of entry, The background of Minh Phu Company, Reasons for finding new market, PESTEL analysis and Select a method of entry for the plan In conclusion, we hope that the report is useful to Minh Phu company and other enterprises in the export industry Hope that Minh Phu company will achieve more successfully in the future in the international market Reference https://moit.gov.vn/en/news/ministerial-leaders-activities/switzerland-supports-vietnamin-enhancing-trade-policy-and-export-promotion.html https://minhphu.com/vi/trang-chu/ https://www.economy.com/switzerland/unemployment-rate https://tradingeconomics.com/switzerland/inflation-cpi https://tradingeconomics.com https://www.theglobaleconomy.com/Switzerland/wb_voice_accountability/ ... that make up the group's reputation Minh Phu' s main export markets are the US, Japan, EU These tenses are creating a lot favorable for the export of the main product is Shrimp by Minh Phu by III... 2019 (data in 2020), which initially marked the spectacular development of Minh Phu Seafood when entering the fastidious market With this success, Minh Phu can completely conduct exports to Switzerland. .. and markets Therefore, Minh Phu can completely choose to export directly to Switzerland VI Conclusion With the goal of recovering from the Covid19 and developing the economy of Vietnam, the enterprises