In this comprehensive analysis, we will delve into the complex management challenges that VINAMILK has had to face, such as increasing competition as more rivals enter the market, unstab
Trang 1FPT UNIVERSITY
CAMPUS ĐÀ NẴNG
GROUP ASSIGNMENT INTRODUCTION TO MANAGEMENT
MGT103 TOPIC: ANALYZE MANAGEMENT CHALLENGES
FACED BY VINAMILK COMPANY
LECTURE R
: Hoang Thanh Hien
CLASS : MKT18D01 MAJORS : Digital marketing PERIOD : Spring 2024
GROUP MEMBERS STUDENT ID
Huynh Le Nam Giang DS180260
Nguyen Nam Son DS180038
Hoang Thi Nguyet DS180477
Nguyen Thao Lan DS180228
Nguyen Thi Thao Linh DS180034
Trang 2TABLE OF CONTENTS
1 INTRODUCTION 2
2 CHALLENGES FACED BY VINAMILK COMPANY 2
2.1 Many competitors enter the market 2
2.2 Input raw materials sources are unstable 2
3 SOLUTIONS 3
3.1 Increase brand recognition and customer incentives 3
3.2 Guaranteed quality raw materials 4
3.3 Use reasonable rights, assign authority and responsibility, and create a working environment 5
4 CONCLUSION 7
5 REFERENCES 9
6 APPENDIX 10
6.1 Appendix 1: Contact details for interviews: 10
Trang 31 INTRODUCTION
Vietnam Dairy Products Joint Stock Company, also known as VINAMILK, is one of the leading companies in Vietnam in the dairy processing industry, specializing in milk production and milk-based products Established in 1976, VINAMILK celebrated its 45th anniversary in 2021, serving Vietnamese consumers Initially starting with 3 milk factories, VINAMILK now operates 16 factories domestically and internationally, along with 14 dairy farms meeting international standards, managing over 160,000 dairy cows to ensure the growing demand for milk production both in Vietnam and for exports
With sustainable development over nearly 5 decades, VINAMILK has become the sole dairy enterprise in Southeast Asia listed in the world's Top 40 in terms of revenue It is the most valuable milk brand in Vietnam and ranks 6th globally in the Brand Finance organization's ranking However, behind this success is a journey full of challenges and obstacles that have tested the company's management capabilities In this comprehensive analysis, we will delve into the complex management challenges that VINAMILK has had to face, such as increasing competition
as more rivals enter the market, unstable input material sources, Vietnamese consumers' preference for foreign milk, and propose potential solutions to ensure the company's continuous dominance in the ever-evolving dairy industry market
2 CHALLENGES FACED BY VINAMILK COMPANY
2.1 Many competitors enter the market
With the market participation of many strong competitors, Vietnamese consumers have more and more choices with similar product characteristics or alternative products such as: Nestle, Dutch Lady, Abbott,
The tax reduction roadmap that Vietnam committed to when joining the WTO is to reduce taxes on powdered milk from 20% to 18%, condensed milk from 30% to 25% This is an opportunity for Vinamilk's competitors to easily Easier to penetrate the Vietnamese market
Trang 4The current dairy farming industry in Vietnam is mainly based on households (95%) Total fresh milk output only meets 20-25% of milk consumption, the rest must be imported After a number of years of overheating development, since 2005 the development of the dairy industry has also slowed down and revealed a number of new difficulties and weaknesses, especially in the issue of macro management organization and organizing production management of livestock facilities This is a challenge to the stability of raw material sources
In 2010, if the Doha negotiation round is successful, developed countries will reduce or eliminate agricultural subsidies in general and the dairy industry in particular, and raw milk prices will increase
Dairy cow feed costs account for 70% of the selling price of milk, while this cost in Thailand accounts for only 57%, and Taiwan accounts for less than 43% This is the main reason leading to the high price of raw milk While the price of imported raw materials from milk processing companies is low, dairy farmers are not interested in their work
Dairy farmers have almost no profit, while raw material buyers are pressuring prices which can reduce the domestic source of fresh milk raw materials, pushing Vinamilk into a competitive buying position with businesses Purchasing other milk
2.3 In addition, Vinamilk also has some other challenges such as:
The export market still has many potential risks
Exporting vinamilk's products to the Middle East market also has many potential risks For example: The war situation in Iraq and the US greatly affects VNM's revenue
Powdered milk market share is not high:
Cannot compete with imported powdered milk products from the US, Australia, and the Netherlands According to BVSC's latest report, the domestic powdered milk market is made up of 65% imported milk products, 20% Dutchlady, and 16% Vinamilk
3 SOLUTIONS
3.1 Increase brand recognition and customer incentives
The Vietnamese milk market is facing difficulties because of the appearance of new and foreign milk brands such as Nutifood, Dutch Lady and TH true Milk, VitaDairy, Nestle, Abbott, These
Trang 5brands have just entered the market, wanting to quickly reach customers, so they have offered very good incentives and prices
Nestlé Abbott Dutch Lady
This is very easy to attract customers and can make them forget Vinamilk
To deal with many competitors entering the Vietnamese milk market, Vinamilk needs to expand its brand recognition nationwide Vinamilk is the most known milk brand in the Vietnamese milk market, both urban and rural, but in highland and disadvantaged areas, milk is still a luxury and expensive product Therefore, Vinamilk needs to build campaigns and volunteer activities to make the Vietnamese milk brand completely "cover" the people In addition to measures to increase recognition, Vinamilk also needs to offer promotions and incentives for customers With a long history and the trust that the brand has built over the past decades, it can beat new competitors
3.2 Guaranteed quality raw materials:
Vinamilk is not yet independent in its raw material sources, mainly depending on imported raw materials, which is one of Vinamilk's weaknesses When domestic raw material sources only meet about 30% of production needs, about 70% of the supply source and the proportion of input materials depend on world supply relationships With raw materials imported from abroad, Vinamilk is still struggling to find a solution Even though there is an organic dairy farm, it still cannot provide enough resources as the demand for milk increases
Trang 6
Vinamilk and the United States cooperate in milk production
Vinamilk needs to optimize feed costs but still provide enough nutrition to ensure milk quality In addition to expanding natural cow farms for people, Vinamilk needs to have campaigns and incentives for farmers to be able to provide raw materials for domestic production without importing them
3.3 Use reasonable rights, assign authority and responsibility, and create a working environment
Assigning powers and responsibilities: This is clearly defining who does what, who decides what, and who ensures what responsibilities in Vinamilk 's export activities The purpose of this work is
to avoid ambiguity, confusion, and conflict in management, as well as to increase the efficiency and productivity of employees For example, Vinamilk can divide management levels as follows: Highest level: Export management, including market, legal, business experts, etc., has the authority to make decisions on strategy, planning and budgeting for export activities, as well as monitoring and evaluating the results of the management levels below
Trang 7Intermediate level: Department heads, directors, and representatives of Vinamilk in export markets, have the right to implement decisions and plans of the highest level, as well as manage and guide export staff exports in operational tools, such as distribution, sales, customer care, etc Lowest level: Export staff have the right to perform assigned tasks, as well as contribute architectural opinions and feedback on issues related to export activities
Creating a working environment: This is about building a company culture based on respect, trust and mutual support between management levels and employees in Vinamilk 's export activities The goal of this job is to create a comfortable, harmonious, and connected working atmosphere, as well as to improve the morale and capacity of employees For example, Vinamilk can create the following working environment:
Respect: Vinamilk should respect the rights, needs, and opinions of management and employees, as well as respect the differences in culture, customs, and habits of export markets Vinamilk should also respect professionalism, honesty, and fairness in management and work Trust: Vinamilk should believe in the capacity, responsibility, and results of management and staff at all levels, as well as believe in the quality, reputation, and value of export products Vinamilk should also believe in the cooperation, support and interaction of departments related to export activities
Support: Vinamilk should support management and staff levels in implementing export goals, strategies and plans, as well as support difficult issues, challenges and risks in export activities password Vinamilk should also support training activities, meetings and exchange of experience between management levels and export staff
3.4 - Economical and efficient:
Resource optimization: This is the effective use of energy resources, time, and costs in Vinamilk's export activities, to increase productivity and profits The purpose of this is to reduce waste, increase competition, and protect the environment For example, Vinamilk can optimize resources
as follows:
Energy: Vinamilk should apply measures to save electricity, water, and fuel during the production, transportation, and preservation of export products, such as using energy-saving
Trang 8equipment, using renewable energy, inspecting and repairing electrical, water, and gas systems, etc
Time: Vinamilk should shorten the production, transportation, and delivery time of export products, such as applying technology and digital transformation, optimizing production processes, and choosing fast means of transportation fast and safe, etc
Cost: Vinamilk should minimize the costs of producing, transporting, and distributing export products, such as taking advantage of available resources, finding reputable and effective suppliers and partners, and taking advantage of tax incentives and support from trade agreements, etc Measuring and evaluating results: This is the use of methods and tools to examine and evaluate the results of Vinamilk's export activities, to promote quality control and find areas for improvement The purpose of this is to improve the efficiency and effectiveness of export operations, as well as to meet customer needs and requirements For example, Vinamilk can measure and evaluate results as follows:
Measurement: Vinamilk should use indicators and data to measure export performance results, such as revenue, profit, costs, market share, response rate, satisfaction rate, etc Vinamilk should also use tools and software to collect, process, and analyze this data, such as Excel, Power
BI, Google Analytics, etc
Evaluation: Vinamilk should use methods and criteria to evaluate export performance, such as comparison with plans, goals, and standards, comparison with competitors, comments and comments from customers, etc Vinamilk should also use measures and solutions to improve export performance, such as changing strategies, plans, and budgets, training and improving employee capacity, changing suppliers and partners, etc
4 CONCLUSION
One of the challenges that Vinamilk is facing is fierce competition from competitors in the industry The appearance of many other milk brands has made the market more competitive than ever To maintain its position, Vinamilk needs to maintain product quality and create a difference
to attract customers
Trang 9In addition, financial management is also an important issue Vinamilk needs to control production costs and save resources to optimize profits At the same time, they need to invest in research and development to not fall behind in the technology race
Ultimately, building and maintaining your reputation is important Vinamilk needs to maintain its commitment to customers and build a positive image in the hearts of consumers By applying effective management principles, Vinamilk can continue to grow and face future challenges
Trang 105 REFERENCES
1 Vinamilk (n.d.) Thông tin chung Http://Vinamilk.vn/ https://www.vinamilk.com.vn/phat-trien-ben-vung/bao-cao/2022/thong-tin-chung.html
2 Vinamilk (n.d.) Lịch sử phát triển | Vinamilk Việt Nam - Vinamilk
Www.vinamilk.com.vn https://www.vinamilk.com.vn/vi/lich-su-phat-trien
3 Xuất khẩu của Vinamilk bị ảnh hưởng bởi bất ổn ở Trung Đông (2018,February 22) nhipcaudautu.vn https://nhipcaudautu.vn/kinh-doanh/xuat-khau-cua-vinamilk-bi-anh-huong-boi-bat-on-o-trung-dong-3322710/
4 Chi, L H (2021, June 18) Phân tích ma trận SWOT của Vinamilk Luận Văn Việt
https://luanvanviet.com/phan-tich-mo-hinh-swot-cua-vinamilk/
5 Vinamilk (g.p) Các đối thủ cạnh tranh của Vinamilk Https://giaiphapmarketing.vn/doi-thu-canh-tranh-cua-vinamilk/
6 Kỳ, N H (2022, July 25) Cuộc chiến sữa Việt - Đối thủ cạnh tranh của Vinamilk là ai? Giải Pháp Marketing https://giaiphapmarketing.vn/doi-thu-canh-tranh-cua-vinamilk/
7 Lực, Đ H Đ (n.d.) Sử dụng năng lượng tiết kiệm và hiệu quả hướng đến sự phát triển bền vững năng lượng Việt Nam Sử Dụng Năng Lượng Tiết Kiệm Và Hiệu Quả Hướng Đến Sự Phát Triển Bền Vững Năng Lượng Việt Nam https://epu.edu.vn/chi-tiet-tin/su-dung-nang-luong-tiet-kiem-va-hieu-qua-huong-den-su-phat-trien-ben-vung-nang-luong-viet-nam-13163.html
8 Melodylogistics.com (2021, April 14) Xuất khẩu là gì? 6 hình thức xuất khẩu phổ biến Melody Logistics https://melodylogistics.com/xuat-khau-la-gi-vai-tro-va-cac-hinh-thuc-xuat-khau-pho-bien-889.html
9 Biện pháp hạn chế xuất khẩu, hạn chế nhập khẩu (n.d.) https://thuvienphapluat.vn/chinh-sach- phap-luat-moi/vn/thoi-su-phap-luat/tu-van-phap-luat/44444/bien-phap-han-che-xuat-khau-han-che-nhap-khau#google_vignette
10 a280004, & MGM.A-0388.DMHa (2022, April 7) Phần mềm quản trị doanh nghiệp NỀN TẢNG QUẢN TRỊ DOANH NGHIỆP HỢP NHẤT MISA AMIS
https://amis.misa.vn/45040/nguyen-tac-quan-ly-la-gi/
Trang 116 APPENDIX
6.1 Appendix 1: Contact details for interviews:
Company's name: Da Nang branch of Vietnam dairy products joint stock company Address: 7th Floor Post Office Building, 271 Nguyen Van Linh, Vinh Trung Ward, Thanh Khe
District, Da Nang City, Vietnam
Phone: (84 0236) 358 4848.
Fax: (84 0236) 389 72 23.
6.2 Appendix 2: Additional supporting materials
Detailed analysis of Vinamilk's business strategy: This article presents a comprehensive SWOT analysis of Vinamilk, highlighting its strengths, weaknesses, opportunities, and threats in the domestic and international markets
Hùng, V N (2023b, September 12) Detailed analysis of Vinamilk's business strategy Malu Design - Branding Agency Malu Design - Branding Agency
https://maludesign.vn/en/news/detailed-analysis-of-vinamilks-business-strategy/#:~:text=The
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