GERNERAL INTRODUCTION TO FDC
Overview of FDC
1.1.1 History and development process of FDC
FDC is a member company belonging to FTG which is a branch of FPT corporate company In 1998, FDC was established based on the combination of FCD and FCO Company
In 2001 and 2002, FPS and FPT Computers Products Center were established, leading to the formation of FDC on April 13, 2003 This new company was created through the integration of FCD, FPS, and FPT Computers Products Center to address the rapid growth of the distribution market, initially employing 86 staff members.
FDC developed and included Distribution Nokia mobile phone center (F9) and Distribution technological products & Project support Center (such as FCN, FHP, F1, FPS and so on)
In 13rd, March 2009, FPT Information Technology Distribution was established and then integrated into FDC At that time, there were 206 staff in FDC but FDC did not include F9
According to the statistics of Human Resource Department, there were 252 staff in FDC (15th May, 2014), which is much higher compared with that in 1998.
At the moment, FDC becomes distributor for over 60 international branches such as Dell, Asus, Acer, IBM and so on
1.1.2 Organizational apparatus and human resource management of FDC 1.1.2.1 Organizational structure
Figure 1.1: Organizational structure of FDC
“Source: Human resource department of FDC”
The company president serves as the legal representative and holds the ultimate responsibility for FDC's business outcomes In addition to managing the board of directors, the president has the authority to determine the company's organizational structure, prioritizing efficiency and effectiveness in decision-making.
The Board of Directors plays a crucial role in assisting the company president by identifying specific tasks for staff, such as technology and marketing initiatives Additionally, they address various challenges and issues delegated by the president, ensuring effective management and strategic direction for the organization.
Board of Directors Company president
Each department will carry out a specific task I will explain it in detail in the later part of my report
1.1.2.2 Human resource management a Allocation of human resource
Chart 1.1: Allocation of human resource base on gender
“Source: Human resource Department of FDC”
As we can see from the pie chart, approximately two – third of the human resource in FDC was males, which were much higher compared with the proportion of females (41%)
“Source: Human resource Department of FDC”
The chart indicates that 64% of the company's workforce holds a university degree, while 30% have completed postgraduate studies Only 6% of the staff possess a diploma or vocational training.
Table 1.1: Allocation of Human resource base on functionality
“Source: Human resource Department of FDC”
Chart 1.2: Allocation of human resource base on degree
BachelorPost graduateDiploma, college, vocational training
“Source: Human resource Department of FDC”
The table 1.1 indicates employees by functionality from 2009 to 2012 There were obvious an upward trend for the percentage of managers and back officer.
In 2012, the proportion of managers dropped to just 7%, significantly lower than the rates of specialists and sales, which were five times higher at 37% and 36%, respectively.
Table 1.2: Employees by age range
“Source: Human resource Department of FDC”
Table 1.2 illustrates the distribution of employees by age, revealing that 51% of the workforce falls within the 25 to 30 age range In contrast, only about 0.4% and 2.3% of employees are in the 41 to 50 and above 50 age groups, respectively Additionally, the 31 to 40 age group accounts for approximately 40% of the workforce, making it the second largest demographic in terms of age.
Chart 1.3: Number of employees from 2009 to 2012
“Source: Human resource Department of FDC”
The bar graph illustrates the growth in staff numbers from 2009 to 2012, showing a steady increase from 206 employees in 2009 to 214 in 2011 Notably, by 2012, the staff count experienced a significant surge, highlighting a remarkable trend in workforce expansion during this period.
225 people than the number of employees in 2009 c Assessment the conformity of workforce, size and organizational structure with business sector of FDC
The analysis of the provided tables and charts highlights the alignment between FDC's human resources and its business conditions from 2009 to 2012, allowing for an effective assessment of labor suitability during this period.
A significant 94% of employees at FDC hold bachelor's and postgraduate degrees, specializing in economic and technical fields This expertise is complemented by a notable increase in staff numbers, growing to 225 individuals in 2012, with a substantial 37% of the workforce being specialists.
2012) have helped FDC not only adapt to the increase of consumer demand for products that FDC distribute but also promote importing process, enhance foreign partners.
Individuals under 30 years old constitute a significant 66.33% of the workforce at FDC, representing a valuable "golden resource" that underpins the company's success.
1.1.3 Mandates and functions of FDC 1.1.3.1 General functions and responsibilities of FDC
FDC primarily functions as a distributor of technological products, including laptops, mobile phones, and hardware, sourcing items from major branches worldwide to deliver them to end users The company takes responsibility for ordering and purchasing products before shipping them to retailers specializing in modern technology Additionally, FDC addresses any product malfunctions by checking and repairing faults to ensure customer satisfaction Furthermore, FDC supports various projects in schools, hospitals, and banks by supplying and installing modern equipment, such as computers, to enhance their technological capabilities.
FDC is committed to expanding its distribution network for technological products while increasing its international collaboration Additionally, the company focuses on enhancing labor skills to adapt to the modern workforce while maintaining its established corporate culture.
The duty of Administration Department is sealing the legal documents, transfer documents from boards of directors to the staff, pay monthly salary for staff.
Because I interned in Procurement department so to some extent, I know its duties quite exactly Main function of this unit is implementing import procedure, doing statistics for import products (both value and volume), making orders for products from big suppliers, caring about logistics problems of one consignment.
Another duty of this department is making payment for supplier’s bank For each week,staff has to prepare payment documents which include purchasing order, commercial
Business department shall be responsible for analyzing business activity, supervise orders intended to import before Procuring Department will order the products, claim money from suppliers for wrong products
The Marketing Department plays a crucial role in analyzing trends and predicting customer demand to optimize product import volumes Additionally, this team is responsible for developing effective strategic plans to promote the company's products efficiently.
The Technical Department is tasked with developing an information-sharing system that facilitates internal access to company data Additionally, this division ensures that any products identified as defective before reaching retailers are properly addressed.
Accounting department bears responsibility of checking debts, presenting bills, deploying deliver the goods, keeping products, managing costs.
Human Resource Department is in charge of managing, evaluating weekly and quarterly performance; working progress of staff, and recruiting new staff for company.
1.1.4 Field of business of FDC
The main field of business of FDC is to distribute information technological products Herein are products that are listed in details:
Laptop Division: distribute laptops taken from big branches: Lenovo, Apple, Asus, Acer, Hp, Dell
Mobile phone: from Apple, Lenovo supplier
Computer: IBM and so on
Computer accessories: from the following suppliers: Transcend, Seagate, Kingston technology, Intel, Asrock, Art of colors
Products for projects: taken from many branches: Linksys, Dell, Ca technologies,Microsoft, Lenovo, Asrock, HP, Art of color, IBM, Intel, Asus, Acer, Cisco,Oracle, Corel,
THE STATUS OF IMPORTING LAPTOP PRODUCTS OF FDC BETWEEN 2009
Import laptop products – actual situation from 2009 to 2012
2.1.1 The proportion of laptop imported compared with other products in FDC and laptop import structure 2.1.1.1 The comparison between laptop imported and other products in FDC
Table 2.1: Imported products of FDC from 2009 to 2012
“Source: Procurement Department of FDC”
A glance at the table 2.1 shows that laptops constitute a big value in the total value of imported products (from 31.56% to 43.68% between 2009 and 2012).
Imported value for laptops soared from 6.896 in 2009 to 11.714 million USD in 2012 (nearly doubled) and had highest value compared with other products FDC imported
In 2009, despite the widespread economic crisis affecting various industries, the information technology sector thrived, notably marked by the release of Microsoft Windows 7 This launch significantly boosted the import value of products for projects in FDC, reaching 1.81 million USD, while overall import values soared to 6.896 million USD, tripling the import value of mobile phones.
Between 2009 and 2012, the imported value of laptops surged to 11.714 million USD, nearly doubling from 2009 Mobile phone imports also increased significantly, rising from 2.159 million USD to 5.4 million USD over four years In contrast, the value of imported computers decreased to 5.32 million USD in 2012, significantly lower than that of laptops Throughout this period, the import value of printers remained consistently low, representing a small fraction of total imports.
Laptops have become highly valued products, especially as their prices have decreased since 2009, when the economic crisis led to lower consumer demand By 2012, the economy improved, resulting in increased competition among major producers, which drove down laptop prices Consumers also recognized the convenience of laptops over traditional computers, as laptops are portable and lightweight, making them a preferred choice for on-the-go use.
Between 2009 and 2012, FDC imported a variety of laptops, including popular brands such as Lenovo, Apple, Asus, Acer, HP, and Dell Due to import limitations and data from the Procurement Department, this overview will focus on the key laptops imported during that timeframe.
Chart 2.1: Import structure of main imported laptops
“Source: Procurement Department of FDC”
The chart 2.1 represents the import structure of main laptops that FDC imported.
The analysis reveals that Dell laptops dominated imports compared to Apple and HP, attributed to their durability and competitive pricing From 2009 to 2012, all three brands experienced an increase in import percentages, with Apple's share rising significantly from 10.3% to 16.8% This surge was driven by FDC's strategy to test customer interest in the premium-priced Apple brand Meanwhile, HP's import percentage also grew, reaching 24.5% in 2012, slightly below Dell's Although HP offers reasonable pricing similar to Dell, many consumers prefer Dell due to its superior durability.
30.8% If in 2009, the rate of other laptops imported nearly doubled that of Dell (46.8
% and 22.4% respectively), in 2012, the proportion of the former ones was only a little bit higher that of the latter, namely 30.8% and 27.9%
2.1.2 Import market structure of laptop products
Initially, FDC has orientation to import laptops from countries which have strengths in information technology and trusts in international markets In particular, as
I mentioned before, laptops have high value so it is better for FDC to import products from these nations in order to create trusts for Vietnamese customers
2.1.2.1 Import market value of FDC from 2009 to 2012
According to Procurement Department, we have some information about import market value imports (of all products) from main market of FDC in the period of 2009 to 2012
Table 2.2: Import market value of FDC from 2009 to 2012 Unit: Value: Million USD; Rate/Proportion: %
Value Rate Value Rate Value Rate Value Rate
“Source: Procurement Department of FDC”
The table 2.2 represents that the import market value of FDC from 2009 to
2012 In 2009, FDC imported its products mainly from China (14.486 million USD).
Followed closely by China, USA and other nations supplied to FDC quite a high value
The import value of FDC from China reached a peak of 18 million USD before declining to 12.517 million USD, maintaining its position as the leading source for FDC imports In contrast, the markets of Hong Kong, Singapore, and the USA experienced a significant increase in FDC import values during the same period, although their totals remained considerably lower than those from China.
Chart 2.2: The proportion of import value from markets in 2012
China USA Singapore HongKong Other nations
Source: Procurement Department of FDC”
In 2012, over half of FDC's import value came from China, which was three times greater than the value imported from the USA Additionally, FDC sourced 15.53% of its imports from various other markets, while imports from Singapore accounted for only 4.38%.
China, USA, Singapore, Hongkong However, there was a little bit different when we come to market structure for laptop products in 2012 We can look at the pie chart 2.3:
Chart 2.3: Market structure of laptops FDC imported in 2012
USA China Singapore Other countries
“Source: Procurement Department of FDC”
The market structure for laptops reveals significant differences in import proportions compared to all products imported by FDC According to pie chart 2.3, the USA accounts for over 76.86% of laptop imports, a stark contrast to just 8.39% from China This discrepancy can be attributed to the USA's strong laptop manufacturing capabilities, notably with the popular brand Apple attracting numerous distributors Additionally, Singapore emerges as the second-largest source of laptop imports at 12.25%, benefiting from its proximity to Vietnam and the presence of major branches, facilitating easier importation.
2.1.3 Import value and volume of laptop products
Firstly, in terms of import value of laptop products, base on the data of this line graph 2.4, we can have some comments:
Chart 2.4: Import value of laptops from 2009 to 2012
“Source: Procurement Department of FDC”
A glance at the line graph 2.4 reveals that there was obviously and upward trend in the import value of laptops from 2009 to 2012 Staring from 6.789 million USD in
Between 2009 and 2012, the import value of laptops experienced a steady increase, starting from over 7.8 million USD in 2009 and rising to 10.98 million USD in 2011 By 2012, the import value reached approximately 11.7 million USD, significantly surpassing the figures recorded in 2009.
Turing to the volume of laptops products, we have the run chart below:
Chart 2.5: The number of imported laptops from 2009 to 2012
“Source: Procurement Department of FDC”
The line graph illustrates a significant increase in laptop imports by FDC from 2009 to 2012 Starting with over 13 million units in 2009, imports rose to more than 16 million in 2010 The following year saw a dramatic surge, surpassing 25 million units, and by 2012, imports peaked at over 27 million units, effectively doubling the figures from 2009.
The run charts illustrate a clear upward trend in both the trade volume and value of imported laptops from 2009 to 2012, highlighting significant growth in the laptop market during this period.
2.1.4 General import process of laptop products
FDC primarily relies on direct import as its main mode of importing products, and this includes laptops.
When importing laptops from foreign suppliers, FDC utilizes the CIF (Cost, Insurance, and Freight) freight term, which outlines the seller's obligations for arranging carriage and insurance Understanding CIF terms is crucial in the import process, as it ensures that the supplier is responsible for the costs and risks associated with transporting the goods until they reach the buyer's destination.
FDC utilizes CIF terms for importing laptops, which allows me to omit this step from the flow chart While the overall process for importing laptops is similar to that of other products, it's crucial to note that laptops are transported by sea, resulting in potentially different document requirements compared to items transported by air.
2.1.4.1 Flow chart of importing procedure of laptop products
Figure 2.1: Importing Process of laptop products
2.1.4.2 Detail explanations about the process of importing laptop products a Step 1: Acquiring for import license
To import laptops, the first step is for the FDC to secure an import license from the Ministry of Industry and Trade This license outlines the permitted volume of laptop imports, ensuring that the total quantity does not surpass the established quota.
Government, in this case, may put certain restrictions on what is imported as well as the number of laptops imported in each consignment.
Step 6 Claim and settle the claim (if any)
Ste p 4 Taking delivery of import/ discharge the import
Ste p 2 Asking to open L/C and make payment
Ste p 1Acquiring for import license
Assessment about importing laptop situation of FDC from 2009 to 2012 – SWOT analysis
FDC benefits from significant capital amounting to 110 billion VND, enabling it to import high-value products such as laptops This financial strength is largely due to FPT's investment in its member companies, including FDC Additionally, FPT's business operations are bolstered by support from credit organizations and strategic partners Notably, in 2006, FPT formed strategic alliances with major credit organizations like TPG and Intel Capital, fostering a favorable capital environment for its subsidiaries, including FDC and F9.
FDC boasts a young, highly qualified, and enthusiastic workforce that significantly enhances its import activities The dynamic working environment, combined with the team's deep understanding of business, fosters efficiency For instance, during my five-week internship in the Procurement department, I observed that out of 15 staff members, 12 were graduates of Foreign Trade University with specialized knowledge in import-export procedures They operate in a high-pressure setting to ensure timely procurement from major suppliers, meticulously managing each stage of the import process to mitigate risks associated with receiving goods.
The Procurement Department operates under clear and daily supervision, with tasks divided into two main sub-groups: Logistics and Order The Logistics group is responsible for overseeing the entire process from the departure of goods at the supplier's port to their arrival, including the preparation of customs declaration documents Meanwhile, the Order group handles orders for each branch and prepares the necessary documentation for bank payments.
Another point to note is that they exchanged their jobs weekly, which means they would know how to order from every branch that FDC takes import products.
FDC boasts advanced infrastructure and modern equipment that enhance the efficiency of its import operations, supported by well-equipped staff utilizing computers, laptops, and other technological tools.
One significant weakness in the import process is the insufficient number of staff handling the receipt of laptops Given that laptop products require careful preservation, prompt receipt is essential However, at FDC, the workforce dedicated to this unit has not kept pace with the increasing demand, particularly as laptop imports surged from 2009 to 2012.
The second negative point of importing laptops lies in the fact that the average number of days in inventory has stayed at high level
Table 2.3: The average number of days in inventory of laptops from 2009 to 2012
“Source: Procurement Department of FDC”
Over a four-year period from 2009, the days in inventory for imported laptops decreased gradually from 28 to 20 days Despite this decline, a 20-day inventory period remains notably high and significantly impacts the business productivity of FDC The annual innovations in laptop design and the recent decrease in prices have exacerbated the company's challenges, highlighting the extended inventory duration as a critical weakness.
The packaging terms and conditions for products, particularly high-value items like laptops, are not clearly defined (refer to Appendix No 1) The vague statement that “commodities must be packed in accordance with standard for export” can lead to disputes over improperly packaged products Additionally, FDC primarily utilizes direct import as its main import method, purchasing goods directly from suppliers without intermediaries, which can result in FDC assuming all associated costs and risks of importing these goods.
One significant weakness of FDC is its inaccurate predictions, leading to an imbalance in the laptop market where some regions experience a surplus of imported laptops while others face shortages.
FPT's trademark is recognized both domestically and internationally, providing FDC with significant advantages in trade transactions, negotiations, and discounts when importing products, especially laptops.
The demand for laptops for personal use has been steadily increasing, as individuals find it challenging to work or learn effectively without them This rising trend presents a significant opportunity for FDC to expand its distribution of information technology products in the market.
FDC collaborates with major global corporations like IBM and Oracle, which enhances its understanding of international trade and provides access to high-quality products These partnerships also offer significant opportunities for FDC to elevate its reputation in the international market.
The Vietnamese government is actively fostering the growth of the information technology sector, aiming for Vietnam to become the world's third-largest IT supplier by 2015, following the USA and India This supportive environment has enabled FDC, a company specializing in the distribution of IT products, to seize the opportunity and gain recognition among numerous suppliers.
FDC operates in a highly competitive market, especially within the booming information technology sector in Vietnam, which has significantly increased revenue for businesses since 1997 Historically, FDC has served as a distributor for several major retailers.
Since the emergence of FPT Shop, FDC has been distributing directly to its stores, facing increased competition from major retailers like Media Mart and Tran Anh Computer, which offer a wide range of IT products, particularly laptops This competitive landscape has intensified pressure on FDC's pricing and marketing strategies Additionally, rivals such as SEATIC, known for its expertise in IT products, and THAKRAL, which offers significant discounts for immediate payments, pose substantial challenges to FDC's market position.
FDC primarily uses USD for payments, leading to challenges such as fluctuating exchange rates and inflation, which necessitate frequent amendments to import contracts and careful scrutiny of related documents This process is time-consuming and complicates the importing procedure Additionally, FDC's payment structure requires them to pay suppliers in USD while customers pay in VND, resulting in significant currency exchange fees, especially when the USD's value is substantially higher than that of the VND.
Finally, customs procedure in Vietnam is extremely low and constitutes lots of
Some solutions to develop laptop products import situation of FDC in the next 5 years 27 1 Development orientation of FDC in the next 5 years
2.3.1 Development orientation of FDC in the next 5 years 2.3.1.1 Development orientation of general business activities
Over the next five years, FDC has outlined a strategic direction aimed at enhancing its overall business operations This approach is expected to facilitate FDC in achieving its objectives and generating significant revenue for the distributor.
FDC aims to enhance its import strategy by focusing on reasonably priced, high-quality products, as consumers prioritize price and functionality over brand names To achieve this, FDC is working to establish partnerships with larger suppliers, positioning itself as a trusted ally to gain access to major retailers in key cities across Vietnam, particularly in Hanoi and Ho Chi Minh City.
In the next five years, FDC plans to expand its distribution network to foreign markets, particularly in East Asia Currently, FDC is distributing information technology products and mobile phones in Laos With a strong focus on market expansion, FDC is poised to achieve its goals within this timeframe.
FDC is committed to supporting government initiatives by investing in public facilities located in key economic regions, thereby alleviating pressure on the state budget The company aims to enhance its product offerings for projects related to schools and hospitals Additionally, FDC prioritizes tax contributions to the government, which play a crucial role in the development of public infrastructure.
In terms of internal activity, FDC try to increase their annual revenue to approximately 25 000 billion VND, train talent staff to create strong human resource.
FDC aims to enhance employee productivity by investing in modern equipment, creating a conducive work environment that fosters high performance in the company's overall business activities.
2.3.1.2 Development orientation of laptop product import activities
Over the next five years, FDC aims to invest up to $30 million in laptop imports, demonstrating a significant commitment to enhancing its product offerings This substantial capital allocation is driven by the company's strategic vision to meet increasing market demand for laptops.
Firstly, Vietnam is joining into international market so trade between Vietnam and among countries will improve; international trade policy will benefit trade.
Moreover, laptops are convenient products that are well suitable for people living in hectic life.
FDC is a prominent company known for its talented staff, which has fostered trust among customers As a result, the outlook for information technology, particularly in the laptop sector, is very promising in the coming years.
Another orientation of FDC towards laptops is reducing inventory condition As
I mention, inventory condition of laptops product was still high in 2012 FDC will try to reduce this number to 7 days in 2015.
For importing laptops, in the next five years, FDC will expand more about import market Big market such as USA, European market will be paid great attention.
And of course, distribution market of laptops also expand into every cities in Vietnam and some foreign countries
2.3.2 Solutions to develop laptop products import situation 2.3.2.1 Solutions for FDC
To enhance the import activity for laptop products, FDC must focus on improving key internal factors, particularly in human resources, to establish a more efficient framework for executing import procedures Addressing these elements promptly will enable FDC to streamline its operations and better support its import initiatives.
To enhance the import process of laptop products, it is essential to improve employee capabilities in managing import contracts and staying updated on procurement and customs policies Recruiting additional specialists for laptop reception at the destination port can help prevent delays in opening declarations and reduce inventory days Furthermore, fostering strong relationships between FDC staff and customs officials will streamline customs procedures, ensuring a more efficient import process.
To enhance human resources at FDC, it is essential to recruit additional employees with strong proficiency in foreign languages, particularly English and Chinese Given that many of the technical products distributed by FDC are sourced from international markets, effective negotiations must be conducted in these languages to ensure successful communication and collaboration.
Miscommunication due to language barriers can result in significant losses for businesses, making it essential to hire staff who excel not only in their field but also in foreign languages This proficiency is crucial for both distribution and importation of products By accurately forecasting demand, companies like FDC can optimize their laptop import quantities Here are some key recommendations to enhance communication and operational efficiency.
To effectively navigate the business landscape, it is essential to anticipate shifts in the political and cultural environment and their impact on business operations Additionally, assessing both the current capabilities and future strategies of competitors is crucial By integrating these insights, FDC can identify the most suitable market for distributing their products.
To make informed decisions on laptop imports, FDC must accurately predict fluctuations in exchange rates, inflation, and laptop prices While many suppliers are well-known global brands, it is essential for FDC to explore additional suppliers This is crucial as larger suppliers may not offer discounts to FDC, prioritizing their larger clientele instead.
For that reason, understanding about economic activity of some average suppliers’ countries is vital for FDC to expand their business
When doing thorough research, the company can make decision which market is suitable and brings lots of benefits for FDC to import laptops products c Solution for Distribution activity
Selecting the right laptop product line is crucial for enhancing a company's reputation and optimizing distribution activities A product that is in high demand requires a more extensive distribution network To identify the most suitable laptop product line, it is essential to consider a set of guiding questions.
Is this the first line of laptops distribute in Vietnam? If any, is it safe to import it?
Is this better to continue business with old laptop products? If any, do we need to change marketing channel?
Should company have lots of discount programs for regular retailers? and so on d Solutions for terms of the contract and import modes
Understanding the terms and conditions in a contract is crucial for successful distribution activities, as conflicts or risks arising from these terms can significantly impact operations During my month-long internship at FDC, I was tasked with preparing comprehensive payment documents related to purchase orders This experience highlighted the importance of carefully reviewing all contract terms to ensure smooth distribution processes.