the export plan of nhasilk

4 Nhasilk''''s export targets: expand marketshare Products: Square silk scarf, long silk scarf, Turban silk scarf.. Code HS: 621410 Shawls, scarves, mufflers, mantillas, veils and similar a

DA NANG UNIVERSITY OF ECONOMICS

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Course: Export–Import Business

Lecturer: Duong Hanh Tien

Group 7-Class 43K01.2

Students: Nguyen Thi Dung

Ho Ngoc Han

Nguyen Thi Le

Dang Hong Phuc

Kieu Thi Nhu Phuong

Nguyen Anh Thu

Da Nang, 6/2020

Chapter I FIRM 1

I.1 Introduction: 1

I.2 Export orientation: 3

Chapter II INTERNATIONAL MARKET RESEARCH 4

II.1 Step 1: Preliminary screening 4

II.2 Step 2: Secondary screening (Financial and Economic condition) 5

II.2.1 Summary of the result of survey economic conditions in China, Japan and Taiwan: 5

II.2.2 Detailed survey results 6

II.3 Step 3: THIRD SCREENING (POLITICAL AND LEGAL) 14

II.3.1 Summary of political and legal survey results of China – Japan and Taiwan 14

II.3.2 Detailed survey results 15

II.4 Step 4: FOURTH SCREENING (SOCIOCULTURAL) 20

II.4.1 Summary of analysis results 20

II.4.2 Detailed survey results 21

II.5 Step 5: FIFTH SCREENING (COMPETITIVE) 22

II.5.1 Detailed survey results 22

II.6 Select export market 26

Chapter III SWOT ANALYSIS AND SETTING SPECIFIC GOALS 29

III.1 SWOT analysis 29

III.1.1 Strengths and opportunities 29

III.1.2 Weakness and threat 29

III.2 Major goals 30

III.2.1 Target customers 30

III.2.2 Special goals: 30

Chapter IV PREPARING PRODUCT FOR EXPORT 31

IV.1 Export product 31

IV.1.1 Product 31

IV.1.2 General evaluations: 32

IV.1.3 Product standard elements: 34

IV.2 Demand of Janpanese market 34

IV.3 Product adaptation with Japa n market 36

IV.3.2 Mandatory Adaptation 38

IV.3.3 Voluntary Adaptation 39

IV.4 Evaluation 40

Chapter V EXPORT CHANNELS OF DISTRIBUTION 41

V.1 The fisrt stage: 41

V.2 The second stage: 42

V.3 The third stage: 42

Chapter VI EXPORT PROMOTION 43

VI.1 The first stage 43

VI.2 The next stage 44

Chapter VII EXPORT PRICING 45

VII.1 Objectives of export pricing: 45

VII.2 Factors affecting export pricing: 45

VII.2.1 Production expense: 45

VII.2.2 Market research costs 45

VII.2.3 Product adaptation costs 45

VII.3 Determination of valuation method: 45

VII.4 Pricing table 45

TABLE OF PICTURES

Picture 1 Nhasilk's showroom 1

Picture 2 Nhasilk's product 2

Picture 3 Nhasilk's product 2

Picture 4 Trends in inflation of China 6

Picture 5 Exchange rate of China 7

Picture 6 Market intensity of China 7

Picture 7 The growth of market of China 8

Picture 8 The wealth allocation of China 8

Picture 9 Trends in inflation of Japan 9

Picture 10 Exchange rate stability of Japan 10

Picture 11 Market intensity of Japan 10

Picture 12 The Gross Domestic Product (GDP) in Japan 11

Picture 13 Trends in inflation of Taipei 12

Picture 14 Exchange rate of Taipei 12

Picture 15 The intensity of market of Taipei 13

Picture 16 The growth of market of Taipei 13

Picture 17 The wealth allocation of Taipei 14

Picture 18 Political risk of China 16

Picture 19 Custom tariff of China 16

Picture 20 Plitical risk of Japan 18

Picture 21 Political risk of Taiwan 20

Picture 22 Gucci's product 24

Picture 23 Hermes's Product 25

Picture 24 Saigon impressive square silk scarf; Price: 1,500,000 VND 31

Picture 25 “Trong Dong” silk scarft; Price: 2,000,000 VND 31

Picture 26 Turban-Floral silk scarf; Price: 450,000 VNĐ 32

Picture 27 The package of Nhasilk products 32

Picture 28 The tag introduces Nhasilk's mission and the process of making the finished product 33

Picture 29 Nhasilk shawls when burning gives the smell of burnt hair, soot, use hands to melt away 33

Picture 30 Delicate and meticulous seams of Nhasilk products 34

TABLE OF TABLES

Table 1 Preliminary screening 4

Table 2 Secondary screening 5

Table 3 THIRD SCREENING 15

Table 4 China-Competitive 23

Table 5 Taiwan-Competitive 26

Table 6 Pricing table 45

09 Nguyen Thai Hoc, Minh An Ward, Minh An District, Quang Nam Province

Picture 1 Nhasilk's showroomNhasilk's key products are silk scarves and silk ties made from completely traditional Vietnamese silk

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Picture 2 Nhasilk's product

Picture 3 Nhasilk's product

Nhasilk's largest source supplies are Bao Loc silk, in addition to traditional hand-woven silk, and is supplied from Ma Chau traditional craft village, Duy Xuyen district, Quang Nam province Technology on silk screen printing is transferred by Japan and Korea Vision: By 2025, the Nhasilk brand will be present in 5 cities and provinces (Ho Chi Minh City, Hanoi, Da Nang, Khanh Hoa, Kien Giang) and become a destination for foreign tourists when traveling in the 5 cities and provinces mentioned above Become a fashion brand that will affect the region by 2030

Mission:

− Preserve and promote the silk weaving career of the country

− Restore Vietnamese belief in Vietnamese silk

− Affirming position of Vietnam silk on the world silk map

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Nhasilk wishes to bring 100% high-class silk products of Vietnam to the world market With the view that either silk or non-silk, silk must be 100% silk, Nhasilk is confident in the origin and quality of products, ensuring to give customers the feeling of confidence, luxury, and elegance

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Nhasilk's export targets: expand marketshare

Products: Square silk scarf, long silk scarf, Turban silk scarf

Code HS: 621410 Shawls, scarves, mufflers, mantillas, veils and similar articles of silk -

or silk waste (excluding knitted or crocheted)

Result of survey: The major importing countries shawls, scarves, mufflers, mantillas, veils and similar articles of silk or silk waste (excluding knitted or crocheted) in the world

Table 1 Preliminary screening

Number Country

Annual growth

in value between 2015-

2019 (%)

Annual growth

in value between 2018-

2019 (%)

Import value (1000 USD)

Market share (%)

Unit value (USD/unit)

Distance (km)

− About growth in value, China and Taipei-Chinese are the two most prominent markets

− About value imported, the US is the country with th highest value, accounting e - for11.5% of the world market, followed by China and Japan

II.2.1. Summary of the result of survey economic conditions in China,

Table 2 Seconda ry screening

Inflation Projected about

1.9% in 2021

Uptrend About under 1%

Uptrend 1.85% in 2020

in 2020

Flexible About 30.1TWD in

Demand and purchasing power increased sharply

The trend is increasing over the years

Increase steadily

Gini coefficient 46.8 points (2018)

Relative inequality

29.9 point Relative equality

33.8 point (2018) Relative equality

Under normal economic conditions (regardless of the effect of the Covid-19 epidemic),

it can be seen that the inflation rates in all three countries are good enough for a developed economy The exchange rates in China and Japan tend to decrease over the years, showing an increase in the value of the currencies of these two countries, while the exchange rates in Taiwan fluctuate continuously, unpredictable Demand and purchasing power, GDP in all three countries has increased over the years Japan and Taiwan have relative inequality in income distribution, while China has relative inequality

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Picture 21 Political risk of Taiwan

Political risk (1 to 7): in short, medium and long term, it is only at level 1 - the lowest risk level; the risk level of special transactions and the OECD premium classification is also only at level 1, the commercial risk is at level A - the country with low trade risk

• Entry barriers

Tariff: just only MFN duties with 12%

Non-tariff: Taiwan does not currently have non-tariff measures for this item

• Taxes and price control and Intellectual property rights:

Taiwan's Foreign Trade Law includes provisions on the protection of intellectual property rights, anti-dumping, anti-unfair competition, export promotion and other trade issues One noteworthy point in Taiwan's trade liberalization is that state intervention is still very strong The Ministry of Economic Affairs's Foreign Trade Department is still active to help local companies strengthen their international competitiveness, such as the Product Design Improvement Plan, training programs human resources for the company, a division in charge of export promotion, insurance programs and financial support for small and medium enterprises, etc All of these programs are aimed at the goal building Taiwan into an international trade center According to the International Intellectual Rights Index, Taiwan's intellectual property index in 2019 is 7306 points, ranked the 23rdglobally and 6th in the region This shows that Taiwan's intellectual property protection is

at a medium level

II.4.1 Summary of analysis results

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II.4.2 Detailed survey results

a China

• The concept of foreign goods

From the mentality of choosing Western brands in previous years, Chinese consumers are now mostly interested in home-grown products after the US - China trade war In addition, another important factor for Chinese consumers to prefer domestic brands is quality Domestic brands accounted for half of the top 50 brands in China in 2019, while only 18 names were shown three years ago Another study from Nielsen in August found that 68% of Chinese consumers like using local brands

• Gift culture

Handmade and meticulous gifts are always the first choice and gradually interested in some products such as: knit bamboo crafts, sand paintings, rice paintings and artworks They especially like feng shui-related gifts, which imply a wealth of fortune, peaceful health, and Chinese people place great importance on balance and harmony, so when giving gifts to Chinese people like get a pair

Conclusion: for the Chinese market, handkerchiefs are not appropriate, but others accessories such as Turban silk scarf, long scarf or cavat are still possible to develop

b Japan

• The concept of using shawls

Japanese people often use silk scarf as a feminine accessory Silk shawls are also used to keep warm on cold windy days

• The concept of foreign goods

Japanese are known to be loyal customers for domestic products, they prefer domestic products because they think foreign goods are not as good as domestic products However, some Japanese products still prefer to use imported products, such as food, natural products or famous brands

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c Taiwan

• The concept of foreign goods

Taiwanese are quite open to the use of foreign goods, as long as it has clear origin recognition and guarantees of quality standards

Conclusion: Silk scarf for Taiwan people is merely a fashion accessory, not influenced by culture This is a little potential market

II.5.1 Detailed survey results

a China-Competitive

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Company Name Business Type Factory

Big Square 16 mm 100% Real Silk Scarf Hijab Custom

100% Real Mulberry Silk twill; Digital Print Machine

(four different craft for each product: digital printing, screen printing, plain dye and hand paint)

$19.50/1 pieces

$16.20/>=20 Pieces

mullberry silk fabric new designs muslim scarf malaysia instant hijab

100% Silk, Table Screen Printing/Digital Printing/Fabric Dyeing,

$15.00- $50.00 / Piece

Digital Printing Pure Twill Chinese 100% Silk Scarf

100% Silk Scarf, Mullberry Silk

$2.20 - $5.00 / Piece

Luxury Custom neck scarves Silk Scarf Square 100%

silk scarves

100% mulberry silk, printing

$4.48/2-49 Pieces

$3.39/>=1000 Pieces

Elegant ladies scarves silk hair scarf Neck Head Wrap Printed hair accessories

100% pure mulberry silk, Printed

$8.25/1-20 Pieces

$7.48/>=50 Pieces

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product components, printing methods, diverse designs In terms of high-quality silk scarves, the number of suppliers that can be found is 15 suppliers in China with diverse designs and capable of supplying to the market in large quantities on a day with prices The price is quite varied but generally ranges from $ 3 to $ 20 If the search for the term

"silk scarf" on e-commerce site Alibaba can find 19191 results From that shows, the silk market in China is fiercely competitive This can be considered as a weakness for us to

penetrate the market

b Japan-Competitive

• Italia

Italy is the country with the highest export market share to Japan with 47.6% The famous Italian silk scarf brands include:

- Gucci: the price of a scarf ranges from 1-10 million VND

Picture 22 Gucci's product

- Valentino: the price of a scarf ranges from 3-10 million VND

- Armani: the price of a scarf varies from a few hundred to 1x million VND

• France

- France ranked second with a market share of 40.3%

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- Famous French silk scarf brands include:

- Hermes: the price of a silk scarf ranges from 1.5 to 12 million VND

Picture 23 Hermes's Product

- Louis Vuitton: the price of a silk scarf ranges from VND 4-30 million

- Channel: the price of a scarf ranges from 4-30 million

• China

China has an 8.1% market share of this item in Japan Suzhou silk is soft and cool, which

is a unique feature only in Suzhou silk attractive to trade visitors from other countries The price of a Suzhou scarf is only a few hundred VND

c Taiwan-Competitive

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Company Name Business Type Factory

Location Product Characteristics

CHENG HON DAR

85% Silk; exclusively high quality; soft and delicate touch

Các ph kiụ ện được thiết k v i s tinh t , ế ớ ự ếmàu s c pha tr n v i ắ ộ ớánh kim l p lánh ấ

Conclusion: In general, Taiwan silk market is developing quite excitingly, but high quality 100% natural silk scarf is still quite limited in terms of type, style, color, The most popular is fake silk scarf, although the advantage is cheaper than the 100% natural silk scarf, in terms of value, quality, safety when used, it can not be equal to products derived from silk 100% This can be considered as an advantage for our 100% silk product

Through the filtering steps, it can be seen that the Japanese market is very suitable for Nhasilk silk scarf products

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+ Financial and economic conditions

The inflation rate has remained at 0.3 1.5% from 2018 up to now, indicating a stable - growth of the Japanese economy

The exchange rate (JPY/USD) has been on a downward trend since 2017 (117 JPY/USD),

in January 2020 this rate decreased to JPY 107.67 / USD With the downward trend of exchange rates, it will be favorable for our export products to the Japanese market, with silk products in particular Products that will become relatively cheap in the Japanese market are an advantage to compete with Japanese domestic market

As a developed country, Japan's economic growth has always fluctuated at less than 2.5% from 2017 to the present, which is considered a stable growth, although at the beginning

of this year, it was negative 0.7% Because of the Covid 19 epidemic but it did not affect the Japanese economy much

The Japanese GINI coefficient is quite low, ranking 62 in the world with 29.9 points, showing that the gap between the population classes is quite low, the living conditions are quite equal With this index, it can be seen that the affordability of the population is quite equal

+ Legal politics

Short-term and long-term risks in Japan are at safe levels, commercial risks are at B levels (scale A, B, C) The quite safe political environment ensures optimal cost for Nhasilk's products when exporting to Japan For silk items we have to bear IMF duties: 6.6% However, there are also tax incentives that Japan applies and benefits silk products that businesses can apply to save costs:

• Các qu c gia ASEAN: 0% (n u có C/O) ố ế

• Các quốc gia đang phát triển: 0% (N u có C/O) ế

• Thuế dành riêng cho VN: EPA: 0% (N u có C/O); CPTPP 0% (n u có C/O) ế ế

• ASEAN countries: 0% (if C/O is available)

• Developing countries: 0% (If C/O is available)

• Taxes reserved for Vietnam: EPA: 0% (If C/O is available); CPTPP 0% (if C/O is available)

In addition, Japan does not have any non-tariff barriers for this item This can be considered a great advantage for the product to confidently export and increase competitiveness

Intellectual property rights: with the 6th position in the world and the 4th in Asia - Oceania, Japan is rated as highly effective and reliable