Kỷ yếu Hội thảo quốc tế “Thương mại phân phối” lần năm 2020 SOLUTIONS FOR DEVELOPING LOGISTICS SERVICES IN AGRICULTURE IN VIETNAM PERIOD OF INTEGRATION GIẢI PHÁP PHÁT TRIỂN DỊCH VỤ LOGISTICS CHO NGÀNH NÔNG NGHIỆP VIỆT NAM TRONG THỜI KỲ HỘI NHẬP Tran Quoc Viet – Sai Gon University Email: vietgeo_1989@yahoo.com Abstract Over the past years, Vietnam's agricultural sector has achieved certain achievements in order to make agriculture increasingly assertive in the international arena during the integration period However, the development of agriculture is still limited, many problems exist in agricultural logistics The World Bank's report (WB, 2018) shows that logistics costs for agricultural development in Vietnam are 6% higher than in Thailand, 12% in Malaysia and up to 300% higher than Singapore due to many inadequacies in the process transport, storage Therefore, it is necessary to study the situation and propose some solutions to enhance the development of logistics in agriculture in Vietnam Keyword: Logistics in agriculture, integration, development solutions Tóm tắt Trong năm qua ngành nông nghiệp Việt Nam đạt nhiều thành tựu định đưa nông nghiệp ngày khẳng trường quốc tế thời kì hội nhập Tuy nhiên phát triển nơng nghiệp cịn nhiều hạn chế, có nhiều vấn đề tồn logistics nông nghiệp Báo cáo Ngân hàng Thế giới (WB, 2018) cho thấy chi phí logistics phục vụ phát triển nông nghiệp Việt Nam cao Thái Lan 6%, Malaysia 12% cao Singapore tới 300% có nhiều bất cập khâu vận tải, lưu kho Vì thế, nghiên cứu thực trạng đưa số giải pháp để tăng cường phát triển logistics nông nghiệp Việt Nam cần thiết Từ khóa: logistics nơng nghiệp, hội nhập, giải pháp phát triển Introduction In Vietnam, the agricultural sector creates jobs and income for about 70% of the population; about 15% of GDP and 30% of export value Agricultural products are one of Vietnam's important export sectors, contributing positively to the country's overall export turnover In the period of 20102018, the value of Vietnam's agricultural products export has an average growth rate of 12.7% / year If in 2010, Vietnam had 19 export markets reaching more than US $ billion, by 2018, it would have reached more than 30 markets However, Vietnam's agricultural products have to bear a series of logistics costs, making competitiveness difficult in the market This is a big bottleneck that needs to be overcome for the positive development of Vietnam's agricultural supply chain, contributing to the overall development of our country's agricultural sector Therefore, developing logistics services with agricultural value chains from raw materials to consumer markets, optimizing transport costs, transportation, temperature preservation in accordance with international standards will help businesses Agribusinesses and agriculture in Vietnam have a greater competitive position in the market when product quality is guaranteed and the product price is reasonable and can compete with other countries in the integration process Literature review, theoretical framework and methods 2.1 Literature review Every country or business has to carry out logistics activities in many different forms In the world and in the country, there have been many scientific studies on logistics, but studying the impact of logistics on business performance in general and agricultural business, in particular, is quite limited 119 Kỷ yếu Hội thảo quốc tế “Thương mại phân phối” lần năm 2020 - The model at Ohio State University shows the relationship between supply chain characteristics, logistics and production strategy, business performance of enterprises through four components in the model: quality, distribution, flexible factors and logistics service prices; The components of business performance, including ROI, ROA, ROS, ROI Growth, ROA Growth and ROS Growth - Kent Goudrin author (2006) in his work "Global logistics management - A competitive advantage in the 21st century" refers to the market segments of logistics and the characteristics of each market segment, devise appropriate methods to manage logistics activities well, thereby improving the business management efficiency of businesses thanks to the control of supply chain operations to save time serving customers optimally, thereby satisfying customers needs In Vietnam, there have been a number of research works related to logistics and its role in business performance - Authors Nguyen Quoc Luat and Nguyen Thi Bich Ngoc (2013) have focused on analyzing the potential of the logistics market recently in our country, considering logistics as a sharp tool in creating competitive advantages of the business; However, logistics activities are still being overlooked, so businesses not have good preparation of human, financial and material resources to optimally exploit these activities in the enterprises, causing business costs of Enterprises, especially for production enterprises, are pushed up too high, directly affecting the business performance of the enterprises - Dang Dinh Dao (2009) "Solutions to develop logistics services of production and business enterprises in Hanoi City" studied quite detailed information about logistics services of businesses, which are mainly outbound logistics and incoming logistics services to boost production and business activities, improve efficiency for businesses Regarding the study of logistics activities in agriculture in our country is still limited, only seminars are organized by the Institute of Strategy - Ministry of Agriculture and Rural Development to give some solutions to solve the export situation export of agricultural products in Vietnam 2.2 Theoretical framework 2.2.1 The concept of logistics services There are many different logistics concepts in the world and are based on the industry and purpose of the study on logistics services, however, some key concepts can be mentioned: According to the United Nations (International training course on multimodal transport and logistics management, Foreign Trade University, October 2002): Logistics is the management of the process of transferring raw materials through the stages of storage, produce products to consumers according to customer requirements According to The US Logistics Management Committee: Logistics is the process of planning, selecting the optimal plan to carry out the management, control movement and storage effectively and costly and shortest in time for raw materials, semi-finished products and finished products, as well as the corresponding information from the pre-production stage until the goods reach the final consumer to meet customer requirements Logistics is the name of logistics service in the beginning of this phrase that appeared in Vietnam Currently, even in Vietnam, most experts agree that using the word "logistics" to explain logistics is still not fully aware of the meaning of modern logistics and so the solution is to just leave the logistics word in our country language, as well as marketing and containers According to the Vietnam Trade Law 2005 (Article 233): Logistics services are commercial activities whereby traders organize one or more stages including receiving goods, transportation, warehousing, warehousing, and making customs procedures, other paperwork, customer advice, 120 Kỷ yếu Hội thảo quốc tế “Thương mại phân phối” lần năm 2020 packaging, marking code, delivery or other services related to goods as agreed with customers to receive remuneration Thus, Logistics can be defined as an optimization process of time and cost in the movement of goods or information related to input (material and fuel) and output (final production) from the starting point to the point of sale to meet the needs of the customer; in simple terms, the service is to deliver, receive and store goods 2.2.2 Activities of logistics Activities of basic logistics include: Receiving goods, transportation, warehousing, warehousing, customs clearance, other paperwork, customer advice, delivery or other services related to goods under agreement with customers 2.2.3 Logistics services Logistics services include Transport services; technical inspection and analysis services, postal services, wholesale trade services, retail trade services, including warehousing, collection, aggregating and sorting activities, redistribution and delivery, and several other transportation support services 2.3 Research methods To complete the paper, the author uses the following main research methods: - Statistical method: The statistical documents to ensure the legal value is fully exploited for research Data is collected, aggregated, processed on the basis of data and statistical results of the General Statistics Office, Ministry of Agriculture and Rural Development to clarify the status of logistics development in agriculture in Vietnam integration era - Methods of analysis, comparison and synthesis: During the course of research, the author has analyzed, compared and synthesized the status of logistics development in production and distribution of agricultural products in our country, since then propose solutions to develop logistics in agriculture in the study area - Forecasting method: based on analyzing the series of statistics to see the development rules of logistics industry in general and logistics in agriculture in particular in the future Since then, offering solutions to develop logistics in agricultural production in Vietnam Results 3.1 Situation of logistics development in agriculture in Vietnam during the integration period 3.1.1 Achievements of logistics development in agriculture in Vietnam Over the past years, thanks to the promotion of international economic integration and active participation in bilateral and Multilateral Free Trade Agreements (FTAs), Vietnam has experienced impressive growth in exports Specifically, the total value of Vietnam's agricultural, forestry and fishery exports in 2018 reached over US $ 40 billion, an increase of 15.3 times compared to 1995 Since joining the Association of Southeast Asian Nations (ASEAN), the export growth rate averages 12.6% / year Vietnam's agricultural exports are ranked 15th in the world, second in Southeast Asia Vietnamese agricultural products have been exported to more than 180 countries and territories around the world Some agricultural, forestry and fishery products of Vietnam have a very high proportion of export value and position in the world, such as pepper, cashew, shrimp, pangasius, coffee, wooden furniture, rice However, we are exporting raw products, so the ranking of export value is very low, we not specify the type of quality, 80% of agricultural products have not been branded, not have logos, label The rate of losses in production and post-harvest is still high, both in terms of quantity and quality, high transaction costs, reduced value-added and affecting the reputation of Vietnam's 121 Kỷ yếu Hội thảo quốc tế “Thương mại phân phối” lần năm 2020 agricultural exports Enterprises purchasing, transporting and processing agricultural products lack equipment, facilities to operate the supply chain effectively, causing high losses in quantity and quality of agricultural products Warehouse system and supply chain of cold storage is limited, not yet operated effectively It can be seen that the logistics system plays a very important role, especially for agriculture, where most farmers have difficulty accessing activities outside their production facilities, especially in the international market According to the World Bank's (WB) Report on Logistics Performance Index (LPI) in 2018, Vietnam ranked 39/160 countries and territories, up 25 places compared to 2016 and rose to third in ASEAN countries Vietnam is also the country with the top LPI ranking in emerging markets This is the best result that Vietnam has had since the World Bank implemented the LPI ranking in 2017 According to the Vietnam Logistics Report 2018, the logistics service industry continues to grow compared to previous years with a growth rate of about 12% - 14% due to the economic growth in general and import and export in particular; especially the development of logistics services in Vietnam 3.1.2 Restrictions on logistics development in agriculture in Vietnam during the integration period Although Vietnam's agricultural exports are ranked 15th in the world, 2nd in Southeast Asia and exported to more than 180 countries and territories However, Vietnamese agricultural products are currently suffering from a series of logistics costs, making the competitiveness difficult in the market The logistics system is still limited, failing to meet the needs of developing modern agriculture Some of the main limitations include: Logistics costs are still high and businesses (most of them are small and medium-sized enterprises) are not eligible to rent logistics packages Logistics costs account for 12% of the cost of fishery products, 23% of wood products, 29% of vegetables and 30% of rice Logistics costs for agricultural development in Vietnam are 6% higher than Thailand, 12% higher than Malaysia and 300% higher than Singapore Low-cost logistics services are accompanied by a lack of quality control standards for food hygiene and safety (Food Safety), so there is often a high loss due to spoilage and infection Logistics supply chain is characterized by many transport buyers and small processing facilities Domestic logistics enterprises (3,000) are mostly small and medium-sized businesses, mainly acting as agents or undertaking each stage of the logistics service chain for international logistics service providers Meanwhile, there are more than 80 foreign enterprises providing logistics services in Vietnam, including 20 leading logistics firms in the world such as APL, MitSui, Maert Logistics, NYK Logistics, Logitem, Mol Vietnam, holds a 70% - 80% market share and self-charges different fees Due to the small scale, domestic enterprises have difficulty in investing in modern equipment and facilities to support the growing logistics activities, especially the road transport system The linkage between agricultural enterprises and logistics enterprises is not close, transactions between the two parties are mainly in the form of seasonal contracts without long-term cooperation and cooperation to support each other to improve the quality products, services and lower prices In agricultural production in Vietnam, the level of mechanization in agriculture is still low, transport and storage capacity is limited, so the rate of agricultural losses in the production, harvesting, storage and packaging stages, shipping is still high The average loss rate in agriculture is about 25% 30% In particular, the loss rate of the fisheries sector: 35%; vegetables and fruits can be up to 45% Enterprises purchasing, transporting and processing agricultural products lack facilities to operate cold supply chains effectively, causing losses in both quantity and quality of agricultural products Warehouse system and cold supply chain are limited and not yet operated effectively According to the statistics of StockPlus Consulting Company, the total area of distribution centres in Vietnam is about million m2, including 155 bonded warehouses Regarding the cold storage system, the total capacity is about 450,000 shelves (pallets) More than 70% of the warehouse area is located in the South The cold supply chain for the domestic market, the system of supermarket restaurants in the country is limited 122 Kỷ yếu Hội thảo quốc tế “Thương mại phân phối” lần năm 2020 The enterprises in the cold supply chain are mostly small-scale domestic enterprises (accounting for 48%), so the chain operation is not transparent Figure Logistics costs in the total cost of products (%) Source: Ministry of Agriculture and Rural Development of Vietnam, 2018 Vietnam's logistics centres are still scattered and spontaneously developed based on the needs of some customer groups, not connected New logistics system has not been established and developed much In 2018, the country has 50 logistics centres (including grade I logistics centres, 38 provincial logistics centres, unclassified logistics centre) Logistics centres operating in Vietnam have been newly developed since 2008, concentrated in some industrial parks The scale of logistics centres is generally small (less than 10 hectares), and regional centres of scale have not been developed Currently, there are regional logistics centres under construction in Bac Giang city and Vung Ang port economic zone (Ha Tinh) With domestic privately-owned centres, infrastructure is invested in small scale, equipped with rudimentary techniques, and there are no technological solutions to support the operation Logistics centres have not been linked together based on analyzing the needs of the whole market as well as the advantages of each logistics centre and decentralizing activities In addition, domestic manufacturing and logistics services enterprises have not yet exploited the potential of existing logistics centres due to lack of awareness of the role of logistics centres and insufficient supply capacity providing logistics package solutions, so the current logistics centres are mainly exploited by foreign logistics service providers Trade infrastructure for agricultural supply has been changing but has not met the demand for agricultural products at home and abroad Modern forms of retail such as supermarkets and commercial centres have grown rapidly, focusing mainly on urban areas and attracting investment 3.1.3 Causes of restrictions on the development of logistics in agriculture in Vietnam during the integration period - The first reason for the high logistics costs in our agriculture is high freight rates, plus an imbalance between the types of road transport and waterway and aviation Currently, most agricultural products are transported by road while the road cost is 20% higher than the waterway - The connection between producers and processing facilities, with the market, is still mostly due to traders, or fragmented transport units, lack of modern logistics centres - The lack of cold supply chains in transporting, storing and distributing makes the rate of loss and damage of agricultural products in our country is quite high, over 25%, especially with fresh fruits, up to 45%, This not only makes the quality of agricultural products go down but also leads to increased logistics costs 123 Kỷ yếu Hội thảo quốc tế “Thương mại phân phối” lần năm 2020 - Transport infrastructure has not met the needs of transporting goods, is still patchy and outdated, has not identified the national gateway system (gateway), there is an imbalance between railway types, road, waterway and aviation in Vietnam's unique conditions The transport of goods depends heavily on road transport services, on the one hand, putting pressure on the road infrastructure system, bridges and bridges; On the other hand, there are many road costs that can cause road transport costs to compete with other types In addition, the lack of synchronous investment among transport modes, the connection system between roads and waterways, railways, and airways is not good, making these types of transportation not only not reach their full potential energy, but also contribute to increase commodity prices 3.3 Solutions for developing logistics in agriculture in Vietnam during the integration period In order to develop the logistics system serving Vietnam's agricultural value chain in the integration period, it is necessary to synchronously implement the following solutions: Transport infrastructure solutions: It is necessary to upgrade the transport system comprehensively in the direction of ensuring multimodal transport corridors by waterway, air, railway and road, including infrastructure and vehicle Solutions to develop warehouse services: It is necessary to synchronously invest in infrastructure of regular warehouses, cold storages, bonded warehouses, truck and container terminals, cargo terminals with means of loading and unloading, management software systems, including for ecommerce goods in the South and the North Solutions on information technology application: needing synchronous investment from crossborder e-commerce platform to applications for transport, forwarding, warehousing, raw material area management, logistics centres load, distribution system, entire supply chain management, automation and artificial intelligence applications Solutions on developing human resources: It is necessary to invest in developing the skills of modern logistics supply chain management at all levels from leadership - management, to executive management, professional techniques for agencies, businesses, labour force, and students Solution for developing agricultural supply system: It is necessary to build a modern agricultural supply centre system with specific models of scale, functions, meeting domestic and national standards International Modern models of agricultural supply centres will link together, serving production linkage with distribution and consumption of agricultural products in the domestic market and for export, quality assurance and safety food, contributing to the development of agricultural production, trade and development services Modern agricultural product supply centres will include 1- Modern provincial / city agricultural product supply centres located in big cities; Agricultural product collection centres are located in key production areas; Border agricultural export centres located in border provinces with important border gates to China, Laos and Cambodia; The network of food hygiene and safety markets in communes complies with the planning, practical conditions, and socio-economic development demands of each locality Solutions for modern agricultural supply systems should be implemented on the principle of digital supply network, multi-channel market access, its logistics activities must be implemented on the cross-border e-commerce platform gender The platform will interact with many other platforms, such as cross-border e-commerce platforms, agricultural and fishery information portals, transport services, delivery, financial and banking, and insurance platforms It allows hundreds of thousands of provider access to tens of millions of customer accounts More importantly, along with this platform is the network of logistics centres with all three types (in material areas, in consumer markets (wholesale markets) and import and export centres) It forms the Online-to-Offline supply system - a modern trend today Conclusions Developing logistics services in agriculture will help Vietnamese agricultural products to 124 Kỷ yếu Hội thảo quốc tế “Thương mại phân phối” lần năm 2020 enhance their value Although playing an important role in the country's economic development, Vietnam's agricultural logistics is still underdeveloped Among them are the basic elements that the warehouse system, processing facilities for agricultural products are lacking, small scale; logistics enterprises are small, not interested in agriculture; logistics staff is inexperienced and knowledgeable about agricultural characteristics Therefore, it is necessary to synchronize solutions on transport infrastructure, warehousing, human resources, logistics supply chain management, etc… to improve the efficiency of agricultural production in Vietnam REFERENCE Angelisa Elisabeth Gillyrard (2003), The Relationships among Supply chain characteristics, logistics and manufacturing strategies, and performance, dissertation, The Ohio State University, The USA Đặng Đình Đào (2009), Giải pháp phát triển dịch vụ logistics doanh nghiệp sản xuất kinh doanh địa bàn thành phố Hà Nội, Báo cáo đề tài khoa học cấp Bộ, Hà Nội Kent Gourdin (2006), Global Logistics Management: A Competitive Advantage for the 21st Century, Journal of Commerce Luật Thương mại Việt Nam (2005), NXB Chính trị Quốc gia thật, Hà Nội Nguyễn Quốc Luật, Nguyễn Thị Bích Ngọc (2013), Logistics - Một hình thức dịch vụ cần đẩy mạnh Việt Nam, Tạp chí Kinh tế Phát triển, số 197, Hà Nội Đoàn Thị Hồng Vân (2010), Logistics vấn đề bản, NXB Lao động - Xã hội, Hà Nội 125