Microsoft Word Tomtat Luan an THATSANADEUANE KHAMKEO Tieng Anh 24 3 1 CHAPTER 1 THEORETICAL FRAMEWORK FOR BUILDING NATIONAL EXPORT MARKETING STRATEGY FOR MAJOR AGRICULTURAL PRODUCTS 1 1 Nature and rol[.]
1 CHAPTER THEORETICAL FRAMEWORK FOR BUILDING NATIONAL EXPORT MARKETING STRATEGY FOR MAJOR AGRICULTURAL PRODUCTS success They are the solutions to implement strategic objectives c Conditions to implement the solutions To implement the strategy, there should be conditions to turn strategic objectives into reality The conditions for the implementation of the strategy include the objective subjective conditions to the strategic subjects 1.1.2 Definition and nature of national marketing strategy Export marketing strategy of a country at the macro level can be considered as: "The whole business of export marketing logics that help the country achieve the structural balance, climate adaptation to the international trade and expected performance efficiency of export marketing objectives on an export identified market in a certain long-term period" The nature and the content of the export marketing strategy of a country can be considered as follows: - Each export marketing strategy is tied to a certain commodity (or group of commodities), to a defined startegic market segment for certain long period of time - An export marketing strategy includes the selection of strategic export market export methods, targeting and positioning product quality on selected export markets - An export marketing strategy has connotations including export product strategy, export pricing strategy, export distribution and logistics strategy, export promotion strategy, product’s and enterprise’s brand strategy to meet the established strategic export markets - An export marketing strategy also includes the deployment of resources for tools and strategic marketing efforts: strategic marketing budget, marketing information system, marketing organization, marketing strategy’s human resources and leadership 1.1.3 National major agricultural export product 1.1.3.1 Definition of product A product is a thing that can be ordered to a market to satisfy a want or a need Product is something to offer to the marketing to get attention, buying, using or consume to fulfill the desires or needs (Philip Kotler) 1.1.3.2 Definition and characteristics of agricultural product a Definition of agricultural product There are many definitions of agricltural product Agricultural product means agricultural, horticultural, viticultural, and dairy products, livestock and the products thereof, the products of poultry and bee raising, the edible products of forestry, and any and all products raised or produced on farms and processed or manufactured products thereof, transported or intended to be transported in interstate and/or foreign commerce (US) Or agricultural products are products derived from agricultural, manufactured and supplied for the purpose of trade, including farmers' products directly produce and processed foods derived from agriculture (TWO) b Characteristics of agricultural product 1.1 Nature and role of the national marketing strategy for major export products 1.1.1 Definition and levels of strategy 1.1.1.1 Khái niệm chiến lược Definition of strategy A strategy is an entity’s oriented plan in a long time, along with a system of policies, measures and resource’s allocation ways to perform to meet the market demand 1.1.1.2 Levels of strategy a National socio – economic strategy A national socio-economic strategy is a document that determines the long -term vision and directions for the development of that nation on key areas such as economic, social, environmental and public management The national socioeconomic strategy is generally drafted by the government and its agencies b Industry’s/Sector’s strategy An industry’s/sector’s strategy is a medium or long term action plan to achieve certain development goals Goals are the destination that the industry/sector are set out and strive to achieve in a certain period of time in the condition of resources available or expected to be able to mobilize The contents of this strategy are specified into programs and development projects, shaping the impact factors, mechanisms and policies to implement the goals of the industry/sector, mining its potential and advantages that take place in each region/locality, to serve development objectives of that industry/sector c Functional strategy A functional strategy is often the overall strategy and aims to coordinate strategies in relation to the expectations of strategic subjects A functional strategy is usually a part of the industry/sector strategy as a tool to achieve the objectives of the industry/sector strategy A functional strategy may include factor strategies such as human resource development strategy, information technology strategy, infrastructure development strategy or tools like marketing strategy, promotion strategy, brand development strategy 1.1.1.3 Components of a strategy a Strategic objectives Strategic objectives can be considered as specific, clear and viable aims of the strategy for the short and/or the long term b Strategic solutions When buiding a strategy,planners must determine the key factors to ensure - The process of producing , harvesting and trade of agricultural products is seasonal - The quality of agricultural products directly affect the health and lives of consumers - There are many kinds of agricultural products, so the quality of the same category is also very varied So that, the issue of identifying target and potential markets play an important role in agricultural product export for a country 1.1.3.3 Major agricultural product A major/key/main product is understood as principal product/service that can be produced/supplied in large quantities with high competitiveness, and can be locally or nationally peculiar A major agricultural product of a country is a product of agricultural origin which it is capable of producing and exporting in large scale, having a large share in the structure of export products of the country, with high competitive advantage in the international markets, with large export markets and potentially long-term development Major export agricultural products have some characteristics: - It is a product that the country has the capacity to produce and export at a large scale and with high uniformity - It is a product that has international competitiveness - It is a product that has specific characteristics for the country while the same product of other countries not have or can not match - It is a product that is safe and environmentally friendly 1.1.4 Rationals for buiding a national export marketing strategy for major agricultural products The national export marketing strategy for major agricultural products plays an important role in implementing the objectives to boost exports of agricultural products, promote socio-economic development for the country This role can be specific as follow: - Creating incentives and new factors to promote exports in the context of increasingly fierce international business environment - Contributing to economic restructuring process, creating new jobs and contributing to improved incomes for workers, particularly farmers, to improve living standard of the people; contributing to the division of labor in the direction of industrialization and modernization of the country - Contributing to export development by exploiting comparative advantages, sustainable development towards sustainability and efficiency; contribute to the export turnover and export growth of that country The main export products are items that can be leveraged and exploited such comparative advantages of the country's manufacturing and exporting as cheap abundant hardworking labor resources, rich natural resources, local/regional/national unique products, thereby making the production and business activities of farmers, business operations of argicultural export firms more efficiently - Contributing to building national brand positioning for agricultural products in international markets; improving awareness and recognition at the international scale for the position and brand of the country’s major agricultural products; building a reputation for quality and value of products; promoting strengths in manufacturing and exporting of major agricultural products of the country, in terms of exploiting comparative advantages, improving competitiveness and enhancing the benefits to the country in the global agricultural value chain 1.2 Model of buiding a national export marketing strategy for major agricultural products 1.2.1 Principles for buiding a national export marketing strategy for major agricultural products A national export marketing strategy for major agricultural products must address three key contents: (1) Identifying strategic objectives: to satisfy the needs of customers (including foreign importers and consumers of agricultural products in foreign markets); (2) Forecasting the customers’ demand and trends of the import markets, analyzing the factors affecting customers’ demand and its trends, and (3) using the strategic tool to win customers - often referred to as the marketing mix The marketing mix strategies need to be tailored to the characteristics of the target export markets 1.2.1.1 Analyzing the situation and finding out attractive export opportunities - Analyzing the international marketing environment - Analyzing the national marketing environment - Analyzing the environment of producing and exporting major agricultural products sector/industry: + Input conditions + Competitive structure within the industry/sector + Demand conditions + Related and supporting industries/sectors - SWOT analysis 1.2.1.2 Identifying the objectives of the national export marketing strategy for major agricultural products - In terms of scale of objectives: + The common general goals/objectives for the whole group of agricultural products such as main exportturnover, export growth, structure of agricultural products’ export, the proportion of processed products compared to raw products, export markets + The specific objectives for each commodity (rice, coffee, fruits and vegetables), each market (continent, country), each commodity group (raw, semi- processed, processed products) , each content/specific stages in the entire process of export - In terms of time: There are long-term goals (from to 10 years and longer), medium-term goals (from 3-6 years) and short-term goals (usually 1-2 years) 1.2.1.3 Buiding marketing – mix strategies - Strategy for major agricultural export products: Need to use the criteria to determine what kinds of agricultural products are major/key products of the country, the characteristics of these products satisfying the needs of customers in certain markets - Strategy of agricultural export prices -Strategy for agricultural export product distribution: concerning the selection and use of methods for export, selecting the importers and seting up and coordinating business networks in foreign markets - Strategy for export promotion: including policy measures that directly or indirectly encourage exports of agricultural products of enterprises, industry and the whole country 1.2.2 Modelling the process of buiding a national export marketing strategy for major agricultural products Environmental analysis and identifying strategic export objectives Updating the information and idendifying strategic changes Marketing strategic analysis for export markets Identifying the target and direction for buiding marketing export strategy Market segmentation Identifying the target market Selecting target markets Selecting export methods Positioning export market Product strategy Identifying marketing – mix strategies Price strategy Distribution and logictics strategy Promotion strategy Identifying the budget Identifying resources for implementing the strategy Identifying the institution Identifying human resource Identifying information system Source: The author Figure: Modelling the process of buiding a national export marketing strategy for major agricultural products 1.3 Content of buiding a national export marketing strategy for major agricultural products 1.3.1 Analyzing the export environment and setting up the strategic objectives 1.3.1.1 Updating the information and idendifying strategic changes The marketing strategy planners have to research and investigate to update the strategic information through the synthesis and analysis of information about the environment that affect marketing activities of national agricultural products’export 1.3.1.2 Marketing strategic analysis for export markets To analyze the marketing strategy for the country, it is necessary to identify the real situation of existing export marketing strategies, identify the movements of these strategies, analyze the opportunities and threats, strengths and weaknesses, from which to draw conclusions on the situation of existing export marketing strategy 1.3.1.3 Identifying the target and direction for buiding marketing export strategy The marketing strategy planners for major agricultural export products of the country can choose among WO, ST and WT, SO strategic combinations to find a suitable ones 1.3.2 Iddentifying the target markets One of The things need to first when developing a marketing strategy is to identify strategic export markets The subject of a marketing strategy in this case is the main agricultural products of the country 1.3.2.1 Market segmentation Segmentation is the detail edprocess of marketing to divide the overall export market into smaller structures (segments) Each segment has it own parameters, characteristics in terms of customers’ behavior, different from other segmets that marketing managers can employ effective marketing mix on it In the framework of this thesis, segmented by geographical and income criteria are considered suitable to reseach the process of buiding marketing strategy for agricultural export of Lao PDR 1.3.2.2 Selecting target markets For agricultural export, the assessment of market segments can be done by usinng some main criteria: (1) current and potential size and growth rate of market segments, (2) the attractiveness of the market segments assessed by using the Michael Porter ‘s five-forces model 1.3.2.3 Selecting export methods Marketing strategy plannners can choose different ways to create and affirm their position on export markets There are three main export methods : ( 1) direct export, (2) indirect export and (3) export cooperation ach method has its own advantages as well as disadvantages 1.3.2.4 Positioning export market Market positioning for major agricultural export products of the coutry include sthe choice of positioning strategy: (1) Positioning on a certain characteristic of the product, (2) Positioning on the ability to satisfy customers’ demand of the product, (3) Positioning on the uses of the product, (4) Positioning by classes of customers, (5) Positioning by comparison with the competitors (6) Positioning with other types of brands 1.3.3 Identifying marketing – mix strategies 1.3.3.1 Product strategy Major agricultural export products of a country are products of agricultural origin which can be producing and exporting at a large scale, have a large share in the structure of export products of the country, with competitive advantages on the international markets, with large export markets and potentially long-term development They are products with high quality and technical standards that meet international standards , with good export possibilities, gain the upper hand in competition with the same products of other exporting countries Thus, in the marketing mix strategy, it is necessary to clearly identify the strengths , the specificity of these products to create a product structure in line with the target export markets 1.3.3.2 Price strategy Pricing strategy may provide a uniform price for all products on the market, or adapted prices in each market area Moreover, it may define the general parameters for all markets and use them when deciding the prices 1.3.3.3 Distribution and logictics strategy Farmers Producers Intermediates Exporters Agricultural associations Cooperatives International markets Source: The author Figure: Channels for distribition of major argicultutal products 1.3.3.4 Promotion strategy Export promotion activities in agricultural export marketing strategy of the country can be implemented at many levels: international, national and business/firm level In the framework of this thesis, export promotion is considered at a national level, which focuses on export promotion activities of the government and government agencies 10 1.4 Factors influencing the buiding of national export marketing strategy for major agricultural products 1.4.1 International factors 1.4.1.1 WTO rules for agricultural products export - The member countries of the WTO is required to comply with the WTO rules on agricultural exports (expressed in the Agreement on Agriculture of the WTO), which focus on three key issues: Market Access; domestic production support and export subsidies - The other non-tariff measures within the WTO framework related to agricultural products: include primarily measures such as the FAO Food Standards; Agreement on the application of SPS; The WTO Agreement on Technical Barriers to Trade (TBT) 1.4.1.2 Characteristics of import market - Demand of the import market - Policies and mechanisms of the import country 1.4.1.3 General situation of the international market In the period of international economic integration, international environment has an important role affecting the operation of a national export The basic elements of the international market include: the world's political situation (stable or unstable); world economic situation; trend of trade liberalization; international commercial activities , the volatility of world agricultural markets 1.4.2 National factors 1.4.2.1 The government’s opinions and policies on export and export boosting Typically, developing countries choose to exploit the possible comparative advantages suchh as abundant and cheap labor forces, mineral resources and agricultural products From the point of export orientation, export is considered to be the driving force for growth, the entire system of policies are mainly aimed at encouraging and strengthening export with the general principle is to ensure that manufacturers gain better if sell their products abroad Government's point of view on exports and boosting exports that affect the establishment of the strategic objectives as well as measures for export , tools and resources for implementing the strategy of exporting countries 1.4.2.2 Capacity of government agencies related to buiding national export marketing strategy for major agricultural products Buiding the national export marketing strategy for major agricultural products consists of many operations related to the functions, duties and activities of different regulatory agencies Capacity and qualifications of those bodies affect the quality of the built marketing strategy 1.4.2.3 Relations among local and central authorities and enterprises in the process of buiding national export marketing strategy for major agricultural products There should be two dimensional consistency from top to bottom (from the central authorities to local authorities and then enterprises) and from bottom to top (in reverse ) in strategic direction, implement solutions and allocation resources to implement the strategy 1.4.2.4 Central and local system to operate, manage and implement the strategy In the process of building national export marketing strategy for major agricultural products, it is necessay to clearly identify: the agency responsible for drafting, the agency responsible for providing kinds of information, the agency responsible for consultation, the agency responsible for monitoring the results There should be clearly defined mechanism of action, coordination among agencies related to the strategic planning process both vertically (central - local - business) and horizontally (state management agency on agriculture - state management agency on the market and export - state management agencies on infrastructure, information, land ) At the same time, route, steps and timeframes should be defined clearly and should be followed closely to obtain the best results 1.4.2.5 Resources for buiding and implementing national export marketing strategy for major agricultural product Resources for building and implementing the strategy include: - Human Resources: it is necessay to mobilize experienced professionals who are capable of strategic planning - Financial resources: budgets for planning and implementing strategies - Information resources: information systems and forecasting of the global market, the production and export of major agricultural commodities, information about partners and import markets - Technological resources and tools to plan and execute the strategy CHAPTER PRACTICAL FRAMEWORK FOR BUILDING THE NATIONAL EXPORT MARKETING STRATEGY FOR MAJOR AGRICULTURAL PRODUCTS OF LAO PDR TO 2020 2.1 Overview of socio - economic development of Lao PDR recently Over 35 years, Lao PDR has achieved great successes in socio-economic development, expressed as the followings: - The economy has continued development, GDP growth has increased (from 1996 to 2014) - The economy has attracted more foreign investment, including the source of official development assistance (ODA) and foreign direct investment (FDI), played an important role in GDP growth of the country 11 12 - Relatively good in inflation control - There have been many measures, including important policies to increase tax revenue and tax costs, revised budget and expenditure management, thereby promoting economic development These reform efforts aimed at consistent implementation many objectives: moving from planned economy to market economy and the shift from an subsistence economy based largely on agriculture to an economy based on services and production controlled by the goverment, by the market forces and private initiatives - Lao PDR is positive, proactive in external relations with other countries in the region and the world Joining the World Trade Organization (WTO) on the day 02.02.2013 as the 158th member of this organization Lao PDR has established diplomatic relations with 130 countries and regions; developed international trade relations and exports to 80 countries and territories, and become a member of many regional and international organizations 2.2 Overview of production and export of major agricultural products of Lao PDR, 2003 - 2015 2.2.1 Production situation 2.2.1.1 Coffee The planted area for coffee: Lao’s coffee is grown mainly in Bolyven Plateau, with a total area (2014) is 84000ha, accounting for 98-99 % of the production area of the country There are main types of coffee planted Robusta and Arabica Coffee yields an average hovering around 1.5-2.5 tonnes/ha Processing and storage of coffee: In Laos, coffee is mainly processed by two methods, that are dry and wet method It is estimated that industrial processing capacity is from 18,000 tons to meet up to 20,000 tonnes of coffee exported, the rest belongs to individual processing facilities, farmers homemade by the manual method In particular, drying and storage stages is limited to reduce the quality of coffee 2.2.1.2 Vegetables Bolyven Plateau is the place where vegetable production is a second priority only after coffee Farmers producing fruit and vegetables for local consumption and export to Thailand In 2010, total vegetable growing area reached 27 031 hectares, production reached 262 426 tonnes In 2014 these numbers increased 36.748ha 535,361 tonnes respectively, up 1.2 times in area and 1.4 times in production compared to 2010 Lao vegetable production is still carried out sporadic, not varied in terms of category, the production operation is limited , management and operation mechanism is still not well - connected together 2.2.1.3 Rice Currently, rice is primarily serves the domestic market , only 30 % of total production was exported in 2012 and 2014 production volume is reached 3.65 million tons / year , up 11% with 2013 2.2.2 Export situation Export turnover: Major agricultural exports of Lao PDR has made great progress in recent years They have been exported to more than 20 countries of all continents The quantity, quality and types of agricultural products export staple has significantly improved The structure of export products has gradually shifted toward promoting comparative advantage in international economic relations Major agricultural exports have contributed significantly to the socio-economic growth of the Lao PDR Unit: USD mil 120 105.8 95.07 100 86.26 95.73 80 78.79 60 39.59 36.28 30.56 2008 2009 40 18.91 20 13.03 13.48 38.84 13.18 2003 2004 2005 2006 2007 2010 2011 2012 2013 2014 2015 Source: Lao PDR Ministry of Industry and Trade Figure: Major Agricultural Products Export Turnover of Lao PDR The situation of exporting major agricultural products in terms of category: see table below (Unit: USD mil.): Year 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Coffee 9,78 10,92 15,86 9,73 8,92 29,76 23,62 14,80 22,45 63,06 66,47 72,74 Vegetables 1,46 1,66 1,89 2,15 2,44 5,91 7,70 8,97 10,38 12,24 16,65 19,23 Rice 0,36 0,45 1,16 1,60 1,82 3,92 4,96 6,79 6,01 3,49 3,14 3,76 Total 11,60 13,03 18,91 13,48 13,18 39,59 36,28 30,56 38,84 78,79 86,26 95,73 Category 2014 2015 80,34 9,85 21,25 22,55 4,20 12,67 105,80 95,07 Source: Lao PDR Ministry of Industry and Trade The situation of exporting major agricultural products in terms of market area: see table below (unit: USD mil): Market 2002 2003 Asia 4,94 5,69 EU 6,66 7,34 USA _ _ Total 11,60 13,03 2004 6,05 12,84 0,016 18,91 2005 7,46 6,003 0,019 13,48 2006 7,05 5,63 0,50 13,18 2007 18,03 16,28 5,28 39,59 2008 19,36 13,41 3,51 36,28 2009 22,09 7,12 1,35 30,56 2010 23,10 15,48 0,262 38,84 2011 49,64 23,07 6,08 78,79 2012 61,39 24,54 0,331 86,26 2013 2014 2015 65,64 72,53 70,67 29,48 32,57 22,49 0,61 0,70 1,91 95,73105,80 95,07 Source: Lao PDR Ministry of Industry and Trade 13 14 2.3 Analysis of factors and resources for building the national export marketing strategy for major agricultural products of Lao PDR to 2020 2.3.1 Current situation of export marketing strategy for major agricultural products of Lao PDR recently The thesis focuses on analysis the real situation of export marketing strategy for major agricultural products of the Lao PDR as a strategic function in relation to the overall marketing strategy as well as development strategy for major agricultural products of the nation The reality is that there have been the elements, aspects and content of the national export marketing strategy, but at a certain level, the real export marketing strategy for the products does not exist ( in written, complete and be published form) And this situation has an impact on development and results of agricultural exports of Laos in different angles The same things happen at the local/provincial levels There have been some content of the export marketing strategy, but not yet formed an “real” strategy in this field At the enterprise level, with the situation that a number of exporters have developed and executed marketing strategy to export their agricultural products, it can be considered a good basis to impact their export results 2.3.1.1 Environment analysisand identifying strategic export objectives of Laos major agricultural products Related to establish export goals/objectives for major agricultural products, Laos government has implemented some strategies such as national export strategy, Strategy for development Laos Coffee, strategy for development and trade processing industry period 2011 - 2020 and the project to promote agricultural production of consumer products (Smallholder develoment project - SHDP) In these strategies, the objectives are to promote smallholder households, agricultural production and processing combined with solid marketing activities with content to are: - Operating activities for farmers involved in manufacturing group with solid marketing work - Strengthening the development of infrastructure, using modern equipment before and after harvest agricultural items - Improving the system of promotion, through technical service center for agricultural products - Completing the production team and marketing strategies in agribusiness - Improving management systems and project management capacity The buiding of agricultural export marketing strategy of the SHDP project is apointed to three departments with uties as follows : Ministry of Agriculture and Forestry for buiding product strategy, the Ministry of Industry and Trade for pricing policies, distribution channels and promotion and the Ministry of Transportation for transport infrastructure, especially rural roads 2.3.1.2 Identifying the target markets for Laos agricultural products # Market segmentation: Target export markets for agricultural products of Laos are defined as follows: the Asian market, a number of EU countries, and the US market This is the largescale market with complex and diverse demand for agricultural products These markets including basic market segments as follows: (1) The major producers, often require and demand for high-quality products, ensuring food safety and very strict standards (2) Intermediates with a relatively high income, easy and somewhat more open to the needs of commodities (coffee, vegetables and rice ) Eligible customers are very interested in the quality and reasonable price (3) Traditional markets, usually consumer demand is not high They are mostly concerned about price when choosing Laos items In the aforementioned market segment , the 2nd and 3rd They are the segments with average or low standards These segments are relatively matching to Laos production capacity # Selecting target markets: Major agricultural products of Laos are coffee, vegetables and rice Choosing market – item pairs is suggested as follows: * Items Coffee: the export target market is Asia , EU and USA * Items Vegetables : mainly export markets of Thailand * Items rice: target export markets are Thailand, Vietnam and China # Selecting export methods: Major agricultural products of Laos are exported by two methods: direct export and export cooperation with exports 2002 - 2014 total turnover of 582.05 million USD The two methods are widely applied with directl export for coffee items to EU market and export cooperationfor vegetables to Thailand 2.3.1.3 Identifying marketing - mix Through legislation, the Lao PDR has a number of policies to promote agricultural exports They are: First, policy for traders that create policies favorable conditions, stability, peace of mind and encourage enterprises and economic sectors to develop export production Second, export policy: Lao Government issued Decree No 205 dated 10/11/2001 on the management of the Export - Import items Business executive operation of the government has also been renovated Third, market development policy: At the macro level, the activities of the government agencies in market development, trade promotion, develop bilateral multilateral trade relations and facilitate agricultural exports have been many attempts, but there are also many drawbacks Fourth, Land Policy : The change in land policy that farmers is allocated to long-term land use rights have made steady acreage, yield and production of agricultural products of Laos is growing on 15 16 Fifth, investment policy: In the area of agriculture, investment policies for agriculture and rural areas continue to be adjusted in the direction of investment focus, investment stages cut inefficient or not urgent Create conditions to encourage domestic investment and foreign investment so far , in addition to the construction stages from the basic state budget had more other funds are mobilized in the agricultural sector and rural areas, focuses on the manufacture and construction of social infrastructure Sixth, agricultural promotion and technology transfer policy: Government constantly consolidate and improve on the knowledge and manufacturing experience , the need to provide information about science and technology for the production increasing business In the short term extension policy has been widely deployed , network extension has been formed from the central to the grassroots Seventh, export promotion policy: the operation of the Government for export activities increasingly improved and perfected to encourage exports Although management mechanisms export activities are more innovative steps to make liberal trade environment, promote export activities but there are still some limitations: - The executive management is limited efficacy, especially the management of export activities through the gate in central The task forces in the border area (border police, customs tax authorities, market management ) east but lack unified direction, while the direction and administration of the State management agencies at the central level is not close, the people's Committees of the border provinces unassigned general direction and management and decentralized management of unified field activities - Import management mechanism is not a positive impact to the formation of export traffic channel In general, businesses are not concerned with the movement of goods from production to export, thereby proactively sourcing organization, organized storage, processing, enhancing the value of the goods At the same time thereby ensuring the benefits for producers and exporters - There is a lack of regulations on affiliates in export activities should also state unfair competition , or imposing prices , causing damage to the economic interests of business , loss of export opportunities 2.3.2 Resources for buiding the national export marketing strategy for Laos major agricultural products 2.3.2.1 System of authorities and agencied related to the building of the strategy Since the construction of the market economy and the participation of economic integration with the world and the region, these factors help develop and expand the market as trade promotion, marketing, distribution and logistics, advertising new research interests and concretely implemented in the Lao PDR Laos has developed and issued by the National Export Strategy 2020, Strategy coffee sector development; Industrial development strategies and trade processing during fall of 2011 - 2020 However, this is the common strategy of export commodities, the markets; not a specific strategy in the field of marketing goods for export to the country's NSCL In the above strategies, the content related to the marketing and export of goods NSCL is only a small part, not been focused in-depth analysis The government agencies involved in the process of developing export marketing strategy NSCL Laos include : First, the Ministry of Agriculture and Forestry of Laos, which is the unit directly Promotion Department agricultural and cooperatives, with macro management role in promoting agricultural production, implementation and completion producer groups, the organization of training courses and technical expertise for farmers , handing over the information system of the potential, quantity and quality of goods , promote the use of modern technology equipment in stages of manufacturing and processing, building mechanism and promote cooperation with partners in the country and abroad, to develop the agricultural sector in the direction of industrialization and modernization Second, the Ministry of Industry and Trade, which is the unit directly Promotion Agency and product development, the role of macro management, promoting the business units in terms of offering and sales, management steering group Expo official domestic and international, general information about the situation of domestic production , encourage investment , export marketing strategy to improve the quality of products and export promotion organizations only direct export contract cooperation 2.3.2.1 Bugget and information for buiding the strategy Finance: Funding for the construction of export marketing strategies of national strategy can be obtained from the following sources: - National Budget: In transition economies, Laos has faced many financial difficulties, more over the years has not recognized the importance of a strategic quann export marketing should not inevitably limited funding for this activity Meanwhile, the budget allocation according to traditional rules also make it difficult for the allocation of financial resources for this activity - Other funding sources: Until now, the fact that Project Promotion Project agricultural production into consumer products (Smallholder Develoment Project SHDP) is providing financial resources mainly for the formulation marketing strategy of Lao exports Information: For information to build marketing strategies NSCL export, market research is extremely important At the macro level, the identification of potential world market for export products of the country should be based on the study of the following themes: (1) These rules, laws, regulations, international trade adjust the products (the rules of the WTO, bilateral agreements and multilateral, international conventions on agricultural products; the charter international commodity associations ) 17 18 (2) The national trade policies of countries on agricultural products (policies of the exporting countries, importers ) (3) The growth, morphology and size of the world market for agricultural products; (4) Competition on a global scale, and in the water sector for agricultural products; (5) The situation of prices and price fluctuations of agricultural products for export In fact, market research provides information for developing strategies that have not been done systematically 2.4 The advantages and disadvantages in exporting and buiding the national export marketing strategy for major agricultural products of Lao PDR 2.4.1 The advantages First, exports of agricultural products are the main growth Laos over the years, a larger contribution to the total export value of Lao PDR Second, the agricultural products of Laos retained the traditional export market, has great potential as the Asian markets, the EU and the US Third, based on the identification of major marketing opportunity, has identified pairs of products and segment target export markets Fourthly, deployed, raising the effectiveness of the method of direct export and export co Fifth, structural quality export commodities increasingly being developed in line with market demand export target Sixth, the contents of the export promotion unit for the products has been focused state management, deployment coordination with foreign importers Seventh, the business unit concerned agricultural products of Laos, development resources export marketing strategy 2.4.2 The disadvantages Firstly, most of the business units of major agricultural products Laos does not update the information on the environment , the export market , not to apply the effective analysis method to analyze the situation in order to identify opportunities anvil export marketing threatened Second, Laos potential strategy product development segment pairs are mainly located in the market segment of consumers with the average, but in this segment of Lao goods to compete harshly with the same products of other countries such as Thailand and Vietnam Thirdly, the development of products with its own brand of Laos, exporting good quality products without chemicals have not been limited interest Fourthly, Laos items exported to the target markets of key export average price compared to the price of the world's countries and competition Fifthly, content export promotion of Laos on target export markets with no clear objective, efficient and low, coordinate promotions irrational, always passive and dependent on importers foreign import Sixth, distribution and export logistics distribution simple and depends on the distribution system by foreign importers Never an appropriate distribution strategy to gradually increase the ability to control distribution channels and actively implemented export logistics operation Seventh, marketing strategy funds are insufficient in quantity and inappropriate allocation, organizational scale marketing and human resources are limited CHAPTER ORIENTED SOLUTIONS FOR BUILDING THE NATIONAL EXPORT MARKETING STRATEGIES FOR MAJOR AGRICULTURAL PRODUCTS OF LAO PDR TO 2020 3.1 Strategic orientation for development of major agricultural products export of Lao PDR to 2020 3.1.1 Socio – economic orientation of Lao PDR to 2020 The Socio-economic development Plan of the Lao PDR phase 2011 - 2015 and 2020 identified four orientations: - General objectives: enhance national economic development and sustainable continuous, 2020, the total national product per capita GDP reached 1900 USD Create dramatic changes in the development of science and technology, promote the human factor, basically creating more jobs for the people to poverty reduction, to bring the country out of Laos least developed countries in 2020 Define development goals is to build Laos into industrial water infrastructure - modern technology, rational economic structure, relations of production progress, material life and high spirits Building an open economy, strong export oriented, and import substitution of domestically produced products effectively - Continued development and agriculture and forestry to the next level on the basis of the application of scientific advances and technologies Construction of regional agricultural production focus, of high-tech agricultural zones with modern production methods, linked to primary processing and high quality processing and transfer of science and technology, building extension system agriculture to assist farmers and agricultural enterprises obtained new techniques Promote the development of the service industry and the diverse industries in rural areas, focusing on the processing industry, mechanical engineering for agriculture, villages - On the objectives and orientation of macroeconomic development: Ensuring the growth of the total gross domestic product (GDP) increased by 8% or more, in which agriculture and forestry sector increased by 3.5%, accounting for 23% of GDP, industry 15%, 39% and services increased 38% to 6.5% of GDP On investment, attract investment 32% or about 127 trillion kip, including the state budget from 10 - 19 20 12% 24 -26% ODA, FDI 50-56% of bank credit and 10-12 %, the forecast of the investment structure of the state, such as economic sector accounted for 30%, sociocultural accounted for 35%, infrastructure construction accounted for 35% Inflation trying to maintain status boost and dropped no more than 5% On import export strengthened turnover value - the expected imports and the needs of the development and investment - Orientation for development of agricultural sector to 2020 : Exploiting the potential advantages in agricultural production , development of a large plain , ensure food sustainability , supply of raw materials for the processing industry , promotion producing clean agricultural products , not chemicals to meet the domestic market and export The overall objective of the 2020 food production of 4.2 million tonnes of rice , the ratio of production capacity of tons / ht , trying to produce the same average rice export more than 1,000 000 tons / year 3.1.2 Developemnt objectives for major agricultural sector of Lao PDR to 2020 First, develop key agricultural commodities (rice, coffee, fruits and vegetables) are potential items strengths in product prices, output, quality, favorable environmental conditions and labor skilled production longstanding tradition, towards specialization and modernization, creating items leap Facilitating agricultural sector growth, stability, sustainability and efficiency Second, export-development goals for the whole sector, expanding export markets and maximize local market Focus thriving agricultural products processing industry, production of raw materials to meet the domestic market and abroad, reduce the deficit and raise the added value of products in the industry Third, management and development of human resources in both quantity and quality for sustainable development key agricultural sector Fourth, develop farm produce processing industry to become one of the key industries , key to export , to meet the increasing demand of the domestic market , foreign and high competitiveness , using new technologies , mechanical or technical means modern employers with human resources specialized in the production line processing of agricultural products , creating more jobs for the society , improve competition , contributing to the country's economy strong economic integration and world region Fifth, ensure that the business units effective agricultural development based on new technologies , advanced ; system of total quality management ; labor management , environmental management according to international standards Some specific targets for key agricultural products (rice , coffee and vegetables) of Laos: The total area planted to major agricultural products is 2,220,413 hectares, of which: Rice: 2,040,413 hectares of land areas,to the use of fertilizers and chemical micro average of 250-300 Kg./ 1ha , new possibilities increase productivity around -5 tonnes / ( Source: Ministry of Agriculture and Forestry) Coffe : Goals from now to 2020, Lao coffee sector choose the safest figure is 02 million bags of coffee that is 120 thousand tons/year With goals from now until 2020 the ability to increase the area to 120,000 (Source: Ministry of Agriculture and Forestry of Laos ) Vegetables : 60,000 , with output reaching 774 700 tonnes , with export turnover reached US $ 62.59 million forecast in 2020 3.1.3 Some forecast to the potential of major agricultural export of Lao PDR to 2020 3.1.3.1 In terms of export turnever The export turnover of the Lao PDR period 2011 - 2015 and 2020 to reach toward the average growth rate of 12 -18 % / year In 2015 , the total export value was 3110.48 million, the share of exports in GDP of goods is 17 %, including agricultural products reached 213.48 million US dollars accounted for 6.86 % of total export turnover By 2020 that figure equates to 7.115,20 million Focusing on improving the added value and quality of each product exported , reduced exports of crude processed , increasing the share of processed goods using new technologie, promoting exports Concentrating production of high quality products (clean agricultural products, farm produce finished products), use of modern technology in the production line, in accordance with market demand and to receive tax incentives from the partner countries imported products Agricultural output period 2016 - 2020, growth in exports is 18/year, agricultural product exports include Lao PDR, coffee, rubber, cashew nuts, fresh vegetables (products in project contract farming projects), sticky rice Table: Expected export turnover of Lao PDR to2020 Unit: USD mil Chi tiêu 2010 2015 2020 1.Total export turnover 1.788,94 3.110,12 7.115,20 Agricultural export turnover 118,66 213,48 488,39 Major agricultural export turnover (3 items) 38,84 95,07 217,50 Proportion of (3) over (2) 32,7 45 45 - Coffee 22,45 59,85 136,92 - Vegetables 10,38 22,55 51,59 - Rice 6,10 12,67 28,99 Source: Lao PDR Ministry of Industry and Trade 21 22 3.1.3.2 In terms of market General orientation is to utilize all the ability to maintain a reasonable proportion of exports to these markets have in Asia , especially Japan and Aseane market , further promote direct export markets greater purchasing power as the US , EU , China , penetration , increasing the proportion of exports to the Russian market , and the Americas, Africa Orientation proportion of the export market by 2020 , approximately 65 -74 % Asia , the EU is 20-25 % , the US 3-4 % 3.3 Some oriented solutions for export marketing strategy for major agricultural products of Lao PDR to 2020 3.3.1 Improving environmental performance business analysis, determine objectives export marketing strategy for Laos 3.3.1.1 Research update, determine the content and skills SWOT analysis and establishing the plans , the strategic focus on building Lao exports SO strategy: growth strategy focused in the direction of development and market penetration WO strategy: Strategic consolidation and rearrangement apparatus to focus financial and take advantage of opportunities ST strategy: growth strategy focused in the direction of product development WT strategy: The investment strategy to develop production, diversify and enhance the quality of export products 3.3.1.2 Develop targeted marketing strategy for export markets for Laos to 2020 Visibility export marketing strategy : The State shall create favorable conditions for agricultural production and business units to become major suppliers Laos values prestigious national tournament in the manufacture and export of commodities NSCL online Laos brand identity on the export market by 2020 Overall objective: innovation methods, improve leadership and governance NSCL export marketing strategy towards leverage flexible and efficient attractive export opportunities, limitations and risk prevention is important to play more improved quality and performance restructured export marketing strategy, marketing skill upgrading core competitiveness, contributing to successful implementation of the comprehensive goals of industrialization and agricultural modernization, economic development for Laos society 3.3.1.3 Selection breakthrough -oriented focus and develop export marketing strategies for Laos First, develop system upgrades export methods Second, set the goal of becoming a center of agricultural production of raw materials to provide clean export processing manufacturer in the world of agricultural products Thirdly, gradually improve the strength and capacity to invest in switching to organic agricultural product 3.3.2 Develop marketing strategies to meet the target export markets for Laos 3.3.2.1 Recommend strategic market segments Step 1: Segmentation by exporters: Conduct a national market segments for Lao goods covers the national market attractive traditional markets in Asia, the EU and the US 3% 23% 74% Châu Á EU Mỹ Source: Lao PDR Ministry of Industry and Trade 3.2 Oriented viewpoint for export marketing strategy for major agricultural products of Lao PDR to 2020 Viewpoint 1: Develop marketing strategy for Laos exported goods must be based on the strategy for agricultural development, trade and services under the impact of the international business environment and internal environment in the face international scene and integration roadmap for implementing the current WTO commitments of the Lao PDR Viewpoint 2: Develop marketing strategy for xports of Lao PDR must ensure the uniform and consistent roadmap according resilience world economy and core marketing capabilities Viewpoint 3: Develop marketing strategy for exports of Lao PDR, to ensure maximizing breakthrough strategy execution performance Viewpoint 4: Develop marketing strategy exports, Laos to ensure the balance and efficiency in the export business Viewpoint 5: Develop marketing strategy for Lao exports to ensure long term sustainability 23 24 Step 2: Segmentation strategy: In each national market segments conducted according intermediaries - foreign importers Step 3: Advanced Segmentation: For macro segment international markets under the geographical features lifestyle and different requirements Next segment by two criteria: income residential area of export target markets key managers marketing strategies NSCL Lao exports to selected market segments with average income and above average; Split quality products according to the needs of the market 3.3.2.2 Export target markets Maintaining the traditional market segments, develop new markets in Africa, Latin America, Middle East Reducing dependence on one or a few familiar market segment User competitive advantage in the niche market advantage based on: Price than- Quality-Time Supply Mining Regulations Key managers marketing strategies Lao exports to selected market segments with average income and above average; Split quality products according to the needs of the market 3.3.2.3 Proposals selected under the export value of exports For this strategy of export value direct manner and cooperate export development strategy according to market response is coordinated Q.T formula (Quality "quality" - Just in time "in time") 3.3.2.4 Recommend strategies in the market positioning of goods export target Focus set list items appropriate specialized narrow market segment needs NSCL correlation quality, compatible price sale, held in the intermediate selling foreign distributors such as supermarkets, point of sale lower prices, manufacturers of agricultural products processing and export through foreign intermediaries from which to quickly locate items image 3.3.3 The marketing- mix solutions in export marketing strategy 3.3.3.1 Recommended export product strategy First, enhance the work of cultivation, care of seedlings Second, improvements to harvesting, processing and storage of products to improve the quality of agricultural products for export Thirdly, Improving science - technology serving for the processing industry Fourthly, the issue of concern to deep processing, diversification of export items Fifth, build product strategies in line with the scale of production and the resources of the business units 3.3.3.2 Recommended trade promotion strategy One is, must know the full grasp of market information and importing countries major agricultural products (coffee, vegetables and rice) in the world Secondly, constantly improve the value added by marketing Thirdly, Join targeted advertising and exhibitions, especially the Expo in countries that import agricultural markets in the world such as the EU, US and Asian organized several large exhibitions bysector, activity is organized traditional or turnaround of the year Fourth Search should strengthen the representation of corporate purchases of agricultural importer in the world Fifthly, the ad should strengthen communication on items and pictures of business units, the production capacity, the ability to meet delivery and ability within the time limit Sixth, Leverage and promotion support from agencies and organizations concerned, in particular to take advantage of the help of the commercial counselor of the Lao PDR in the exporting country or of the commercial representatives of the importing country Seventh, the maximum media Use Internet on sales promotion, brand development through Website marketing business units Lao major agricultural products 3.3.4 These solutions build on resources export marketing strategy 3.3.4.1 Improving mechanisms and strengthening of the apparatus of state management agencies in Laos to participate in building export marketing strategy 3.3.4.2 Strengthening the financial resources to build export marketing strategy 3.3.4.3 Completing the information system for building export marketing strategy ... 12 ,24 16,65 19, 23 Rice 0 ,36 0,45 1,16 1,60 1,82 3, 92 4,96 6,79 6,01 3, 49 3, 14 3, 76 Total 11,60 13, 03 18,91 13, 48 13, 18 39 ,59 36 ,28 30 ,56 38 ,84 78,79 86,26 95, 73 Category 2014 2015 80 ,34 9,85 21,25... 13, 03 2004 6,05 12,84 0,016 18,91 2005 7,46 6,0 03 0,019 13, 48 2006 7,05 5, 63 0,50 13, 18 2007 18, 03 16,28 5,28 39 ,59 2008 19 ,36 13, 41 3, 51 36 ,28 2009 22,09 7,12 1 ,35 30 ,56 2010 23, 10 15,48 0,262 38 ,84... 49,64 23, 07 6,08 78,79 2012 61 ,39 24, 54 0 ,33 1 86,26 20 13 2014 2015 65,64 72, 53 70,67 29,48 32 ,57 22,49 0,61 0,70 1,91 95, 731 05,80 95,07 Source: Lao PDR Ministry of Industry and Trade 13 14 2 .3 Analysis