I. INFORMATION ABOUT VINACAFE. 1. History of Vinacafe factory. Vinacafé, also known as Vinacafe, is a brand of instant coffee products, and is also a common name used to refer to Vinacafé Bien Hoa Joint Stock Company. This is one of the leading famous product and business brands in Vietnam
BỘ GIÁO DỤC VÀ ĐÀO TẠO TRƯỜNG ĐẠI HỌC KINH TẾ - TÀI CHÍNH TP HỒ CHÍ MINH REPORT MICROECONOMIC Ho Chi Minh City , BỘ GIÁO DỤC VÀ ĐÀO TẠO TRƯỜNG ĐẠI HỌC KINH TẾ - TÀI CHÍNH TP HỒ CHÍ MINH REPORT [MICROECONOMIC] GROUP Lecturer: PhD Pham Quoc Hai Ho Chi Minh City, I INFORMATION ABOUT VINACAFE History of Vinacafe factory Vinacafé, also known as Vinacafe, is a brand of instant coffee products, and is also a common name used to refer to Vinacafé Bien Hoa Joint Stock Company This is one of the leading famous product and business brands in Vietnam -Coronel coffee factory In 1969, a French businessman, Marcel Coronel, with his Vietnamese wife, Tran Thi Khanh, started the construction of the Coronel Coffee Factory in Bien Hoa Industrial Park with the aim of reducing coffee transportation costs about France The factory is designed with a production capacity of 80 tons of instant coffee/year, with all machinery and equipment imported from Germany, and is the first instant coffee processing factory in the entire region Indochina country However, until 1975, the factory had not been successfully tested due to asynchronous machinery and equipment, lack of technical labor in Vietnam and the fierce war situation -Bien Hoa Coffee Factory After April 1975, the Provisional Government of the Republic of South Vietnam nationalized the Coronel Coffee Factory After the reunification of Vietnam, Coronel Coffee Factory was renamed Bien Hoa Coffee Factory and was assigned to the General Department of Food Technology to manage After taking over the factory, Vietnamese engineers sought to overcome the lack of synchronization and successfully put into operation the instant coffee production line In April 1977, the first batch of instant coffee was released, marking an important milestone: Vietnam successfully produced instant coffee A year later, according to the Protocol signed by Vietnam with the countries of the Socialist bloc on barter, from 1978, Bien Hoa Coffee Factory started exporting instant coffee to the Soviet Union and other countries Eastern Europe In 1982, Bien Hoa Coffee Factory was transferred to the Ministry of Food Industry to manage, a member of the Union of Milk - Coffee - Confectionery Enterprises In 1992, the factory was separated from the Union of Dairy - Coffee - Confectionery Enterprises, becoming an independent state-owned enterprise, directly managed by the Ministry of Agriculture and Food Industry Also during this time, after Vietnam implemented the renewal policy and opened up trade with the West, Marcel Coronel - Tran Thi Khanh's family several times asked for permission to get their instant coffee factory back but did not success due to the inability to disassemble old machinery and equipment to carry it elsewhere, while the cost of longterm preservation that Vietnamese management agencies offer is very large In 1998, the factory built another instant coffee production line with spray drying technology This line has a designed capacity of 800 tons of instant coffee/year, 10 times larger than the old Coronel Coffee Factory - Vinacafé Bien Hoa Joint Stock Company On December 29, 2004, Bien Hoa Coffee Factory was transformed from a state-owned enterprise into a joint stock company Because the Vinacafé brand is well known in Vietnam and known by many foreign customers, the founding shareholders (most of whom are people of Bien Hoa Coffee Factory) have named the company a new joint stock company Vinacafé Bien Hoa, abbreviated as Vinacafé Bien Hoa On December 20, 2013, Vietnam Coffee Corporation - the largest state shareholder in Vinacafe sold most of its shares in Vinacafe Currently, 90% of Vinacafe Bien Hoa's shares are in three organizations, namely Masan Consumer Corporation (Masan Consumer) with 53.2%, then Gaoling Fund (23.3%) and Vietnam Coffee Corporation (12.8%) (1.1 Source: Vinacafe.vn) Instant coffee lines Wake-Up Saigon in (bar format) Wake-Up Coffee Black Stone Wake-Up Cafe Saigon Wake-Up Coffee with Weasel flavor Classic Bésame in Vinacafe in Vinacafé eight kinds of the best coffee beans in Vietnam Vinacafé soluble black PS box Vinacafé soluble black PET bottle 50g Vinacafé in box PS hộp Vinacafé in gold bag Green Tea Energy Booster F247 Coffee Phil Instant Drink - Roasted coffee Café Popular roasted coffee beans Premium roasted coffee beans Natural ground coffee Absolute Heritage ground coffee Heritage Crown Coffee Ground Vinacafe Selected Coffee Ground Coffee ground Vinacafe Natural - Wake-Up coffee-flavored energy drink 247 Wake-up 247 coffee-flavored energy drink has natural ingredients from water, sugar, food C02, caramel color, vanilla flavor, coffee flavor, caffeine, taurine, inositol, vitamin B3, vitamin B6, conditioner Adjust acidity, salt - Vinacafé QUALITY - Saigon Iced Milk Coffee This is a product made entirely from the first 100% juice of pure roasted coffee simulated as a filter - Café de NAM Café de Nam is produced in the form of pellets, and is introduced by Vinacafe as 100% pure roasted and ground Robusta and Arabica coffee (2.1 Source: caphehuongvicuocsong.com) Brands of Vinacafe -Emigrate Right after the successful production of the first batch of instant coffee, the main products of Bien Hoa Coffee Factory are still pre-processed coffee products due to the habit of using ground coffee of Vietnamese people Instant coffee products are mainly exported to the Soviet Union and Eastern European countries At that time, the factory's processed coffee products did not have their own brand It was not until 1983 that the trademark "Vinacafé", with the meaning of Vietnamesemade coffee, began to appear on the packaging of instant coffee products exported to the Eastern European market This labeling of origin marks the birth of the Vinacafé brand -Domestic Although using the trademark "Vinacafé" on export products, domestic products still use the trademarks of the Union of Dairy-Coffee-Confectionery Enterprises In the late 1980s, orders for Vinacafé instant coffee were decreasing with the speed of disintegration of the Soviet Union and Eastern European bloc In 1990, Vinacafé officially returned to the Vietnamese market, although some products of Bien Hoa Coffee Factory had been consumed in this market before At that time, Vietnamese users still kept the habit of drinking roasted and ground coffee, not familiar with the habit of using instant coffee Therefore, the factory has launched Vinacafé 3-in-1 Instant Coffee, with ingredients of sugar and cream powder mixed with instant coffee, pre-packed in small packages, hitting the market segment of users with habit of drinking coffee with milk without having to wait for coffee to drip through the filter The success of the product, including the spread of many people who have worked and studied in Eastern Europe, has helped Vinacafé brand quickly dominate the domestic instant coffee market -Brand Positioning Edit (3.1 Source: Vinacafe.com) With the success of instant coffee products, Vinacafé brand became popular In the period of international integration, the brand has been registered for intellectual property by Bien Hoa Coffee Factory in Vietnam and many countries around the world Reasons to choose Vinacafe From the leading position in the instant coffee industry and owning strong brands such as Vinacafé, Wake-up Vinacafé Bien Hoa has successfully expanded the brand Wakeup 247 (coffee-flavored energy drink), currently occupy the 4th position with a market share of about 5% in the energy drink industry in Vietnam, achieving a growth rate of 58.3% in the first months of 2017 ) believes that coffee and coffee products will be one of the pillars of the strategy to develop the beverage industry and create high "added value" for Vietnam's coffee industry I want to analyze more clearly the types of expenses of the company through the types of expenses learned in chapter 10 II THE COST OF VINACAFE The cost of Vinacafe This is the data that we have collected about vinacafe company We have based on this company’s annual report on the types of expenses we learned about: variable cost(VC), fixed cost(FC), total cost(TC), average total cost(ATC), average variable cost(AVC), average fixed cost(AFC) and quantity (Q) And the unit is billion VND The cost of Vinacafe Company In the given table, VC includes labors and materials These numbers of materials decrease over the years from 2208.9 in 2018 to 1698 in 2020 And the figures for labors slightly decreased from 106.3 in 2018 to 98.6 in 2020 Move to fixed cost (FC) include the factors is not change such as selling cost, transportation, taxes,… the factors in the first column of Fc I will collectively be referred to as selling cost and the second column is administrative expenses to easier to explain As you know that in the theory FC is fixed cost, will not change but in the reality FC still has changes Specifically for Vinacafe, the selling and administrative cost significantly decreased because initially the company needs a lot of money to advertise and promote to reach customers, but now the company has had certain achievements and is known by many customers, so this cost is reduce and the enterprise has an efficient operating system, so this cost is also drive down The data for transportation and technology in 2019 is 60.3, which is 1,8 higher the one in 2018 at 58.5 After that in 2020, it rise to 61.6 billion VND The figures for tax increased 42.9, 82.2, 99.6 in 2018, 2019, 2020, respectively It based on this company’s year-over-year revenue The last data, I will show you is quantity of coffee of Vinacafe With the unit is ton As you know, we are facing the Covid 19 pandemic The pandemic that started at the end of 2019 so far has greatly affected the economy of our country and the coffee industry is not exception Coffee production decreased significantly down more than 7.7 thousand tons of coffee in years 2019 and 2020 This greatly affects the cultivation and sale of coffee Theory of cost The first is VC (Variable Cost) Variable Cost is the total varies with the output level Variable Cost includes materials and labors The second is FC (Fixed Cost) Fixed Cost is the total cost doesn’t change according to the output and includes: Selling cost (selling cost, advertising, warehouse and saleman); Administrative cost (managers, staffs and market research); Transports and Technology cost (transports, technology and depreciation); Taxes payable to the State (income tax, VAT) From VC and FC we get the TC, AFC, AVC ATC and MC - TC (Total Cost) is total cost of production Total cost equals VC plus FC - AFC (Average Fixed Cost) is fixed cost allocated toa product Average Fixed Cost equal fixed cost divided by Q (Quantity) - AVC (Average Variable Cost) is variable cost allocated to a product Average variable cost equal variable cost divided by Q - ATC ( Average Total Cost) is total cost for a product calculated by Total Cost divided by Q - MC (Marginal Cost) is equal to the Total cost of the current year minus the previous year Years 2018 2019 2020 VC FC TC Q 2315.2 1987 1796.6 182.1 196.8 194.8 2497.3 2183.8 1991.4 44222 46040 38248 Illustrations AVC AFC ATC 0.052 0.043 0.046 0.0041 0.0042 0.005 0.056 0.047 0.052 MC -313.5 -192.4 (3.1 Chart 1) (3.2 Chart 2) Comparisions a) Compare theory and reality of TC, VC, FC FC,VC, TC VC TC FC Q (4.1 Chart 3) (4.2 Chart 4) The drawing shows us FC does not mean the theory that it changes every year In particular, FC - 2018 is 126 billion with the highest sales and management costs in three years, only shipping and tax costs are not up - 2019, 8 billion is the year with the highest fc for the year because of sales, management and high taxes, although transportation costs are from 60.3 billion 58 billion ( 2020) - By 2020, 8 billion, although the state' s tax price has to be quite high, more than twice as much as 2018, but the sales and management costs are much lower than 2018, FC does not increase significantly From 2018 2019 FC has a sign But 2019 2020 has a slight reduction but negligible So the FC is no longer a direct line of // Q, which has a movement over every year - VC went down every year when Q to go down +2018:2315.2 billion with Q is 44222.0 +2019: 1987.0 billion with Q is 46040.0 + 2020 : 1796.6 billion with Q is 9778.5 - TC is on the VC b) Compare theory and reality of AFC, AVC, ATC, MC (4.3 Chart 5) (4.4 Chart 6) * The drawing in the short term with AFC, AVC, ATC AFC increases every year with the same coefficient: + 2018: 0029 + 2019: 0031 + 2020: 0040 Compared to the theory that AFC increases as Q over the years - AVC and ATC have a drop in each year especially by 2020 The relationship between MC and ATC - MC < ATC => ATC decrease - MC < AVC = > AVC increase The relationship between MC versus ATC and AVC is true But MC did not cut the ATC shaft and AVC any point in the picture * Costs found in financial reports through 2018 - >2020 - The total cost varies with the output level (VC) of vinacafe decreasing year by years - The total cost doesn’t change according to the output ( FC) Change through each year but not significantly = > Total cost of production (TC) decrease - Total cost for a product ( ATC) change by annual output quantity, but 2019 - 2020 is reduced - Fixed cost allocated to a product ( AFC) increase due to FC in 2019, which is slight decrease in 2019 - 2020 and 2018 - 2019, but 2019 - 2020 increase - Variable cost allocated to a product (AVC) decrease because VC decrease Reference material https://vi.m.wikipedia.org/wiki/Vinacafe caphehuongvicuocsong.com https://www.vinacafe.com.vn http://www.fpts.com.vn – Annual report 2020 http://www.fpts.com.vn – Annual report 2018 https://www.vinacafebienhoa.com