essay presented for financial management report research topic business report of mwg

In addition to the Vietnamese market, the group also expands to foreign markets with a retail chain of mobile devices and electronics in Cambodia.. Tran Huy Thanh Tung General Director o

MINISTRY OF EDUCATION AND TRAINING FOREIGN TRADE UNIVERSITY HO CHI MINH CITY

-000 - BACHELOR OF BUSINESS ADMINISTRATION

INTERNATIONAL BUSINESS AND TRADE PROGRAM

ESSAY PRESENTED FOR

Financial Management Report

Research topic BUSINESS REPORT OF MWG

PROFESSOR: MS PHAM THI NGOC DUNG

Academic year: 2022-2023

Member of group

1 Pham Gia Bao 2115027133 K60MF2

2 Nguyen Duc Thinh 2115027076 K60MF2

3 Trinh Hai Tung 2115027087 K60MF2

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1 Introduction

Mobile World Joint Stock Company was established in 2004

Currently, the group has more than 50,000 employees in different positions distributed across the country The company has a network of more than 3,400 stores nationwide In addition to the Vietnamese market, the group also expands to foreign markets with a retail chain of mobile devices and electronics in Cambodia Currently, the business has more than 20 retail stores in

Cambodia

Chairman and founder of Mobile World Joint Stock Company is Mr Nguyen Duc Tai He is one

of the 10 richest billionaires on the Vietnam stock exchange in 2019 with a total asset value of up

to VND 3,260.88 billion This businessman is the "captain" who steers the Mobile World ship from a small business store to today's billion-dollar retail “empire”

- Trading name: Mobile World Investment Joint Stock Company

¢ Charter capital (Q4/2022): VND 14,638,792,800,000

¢ Owner's investment capital (Q4/2022): 23,932,581,517,576 VND

- Certificate of business registration code: 0306731335 issued by Department of Planning and Investment of Binh Duong province,

+ registered for the first time on January 16, 2009 and registered for the 29th time on July

Tran Huy Thanh Tung General Director of Investment Joint

Stock Company Mobile World General Director of Joint Stock Company Technology and Investment

of Bach Hoa Xanh

Doan Van Hieu Em General Director of Joint Stock

Company Mobile World General Director of Joint Stock Company An Khang Pharma

Do Tuan Anh » General Director of Joint Stock

Company Toan Tin Logistics

1.2 Business areas and fields

The current main field of activity of Mobile World Investment Joint Stock Company is buying, selling, warranty and repairing computer equipment, phones, phone components and accessories with the brand Gioi Di Gio Electronics, electrical goods with the brand name Dien May Xanh and food, food, beverages, and other goods with the brand name Bach Hoa Xanh

MWG currently operates major retail chains including: thegioididong.com, Dien May Xanh (dienmayxanh.com), Bach Hoa Xanh (bachhoaxanh.com), Bluetronics, An Khang, etc Mobile World

Established in 2004, from an early e-commerce model with a website introducing product information, Mobile World has now developed into a wide supermarket system and become the

No Vietnam

Green machine

In May 2015, dienmay.com was established in 2010 officially renamed Dien May Xanh Supermarket Each supermarket has an area of 500 -1,000 m2, mainly dealing in household electrical and digital products

An Khang pharmacy chain

An Khang pharmacy chain, formerly known as Phuc An Khang pharmacy chain, was acquired

by MWG 49% from 2018

An Khang is present in 25 provinces and cities in the South and Mekong Delta MWG has also completed raising the ownership rate in An Khang to 99.99%

Business position

The number | retailer in Vietnam and the only Vietnamese company in the Top 100 retailers in Asia - Pacific As of the end of March 2022, the total number of stores that MWG owns and operates is more than 5497 stores

03/2004 - Mobile World Company Limited was established

12 supermarkets

¢ On 14/07/2014, successfully listed 62,723,171 shares with stock code MWG The number

of supermarkets increased by 60%, profit after tax increased by 160% compared to 2013

- Store opening rate recorded a new record with an average of 5 new stores opened in a week Dien May Xanh chain becomes the electronics retail chain with the largest number of supermarkets in Vietnam, covering 43/63 provinces

- At the end of 2015, the company started the trial phase of Bach Hoa Xanh mini supermarket chain selling consumer goods

2016 - 2017

Bach Hoa Xanh achieved EBITDA breakeven at the store level

Completing the purchase of Tran Anh electronics retail chain

Completed the minority stake investment in AnKhang Retail Company - The operator of

An Khang pharmacy chain

At the end of 2019, Dien May Xanh chain officially surpassed 1,000 stores nationwide Bach Hoa Xanh chain expanded by 600 points of sale, bringing the total number of Bach Hoa Xanh stores to 1,008

At the end of 2019, the first electronics retail store was put into trial in Cambodia

The micro-store model - Dien May Xanh Supermini (DMS) - was put into trial in mid-

2020 and developed rapidly with 302 stores in 61/63 provinces by the end of the year to serve people in rural areas Vietnamese village

Bluetronics becomes the No | retailer of phones and electronics in Cambodia with 37 stores

Bach Hoa Xanh is in the Top 3 largest retail chains of food and consumer goods in Vietnam with 1,719 stores

Experimenting with the 4k Farm model (transferring technology and supporting farmers to

grow safe vegetables 4 “Khong”)

MWG's revenue surpasses the $5 billion mark in 2021 with more than 5,000 supermarkets

nationwide

Maintain the leading position in the retail market of technology equipment and consumer electronics according to estimates from the data of major players in the market

Bach Hoa Xanh’s revenue exceeded the 1 billion USD mark and is the Top 3 largest food and consumer goods retailer in Vietnam, reaching the EBITDA breakeven point at the corporate level

An Khang pharmacy chain is officially merged with MWG at the end of 2021

2022

Revenue exceeded 5.5 billion USD with more than 5,700 supermarkets nationwide In which, Dien May Xanh Supermini have surpassed 1,000 stores and TopZone became Apple's largest authorized store chain in Vietnam with 100 stores

Strengthening the position of No.1 retailer in technology products and consumer electronics, top 3 in retailing food, consumer staples and pharmaceuticals

Online sales exceed $800 million thegioididong.com, dienmayxanh.com and bachhoaxanh.com are among the top 10 leading e-commerce websites in Vietnam Officially entered the electronics retail market in Indonesia with 5 Erablue stores

Accordingly, in the fourth quarter of 2022, TGDD recorded revenue of VND 30,878 billion, a significant decrease compared to the same period in 2021 Thanks to the cost of goods sold, the company’s gross profit improved to nearly VND 7,930 billion

Deducting expenses, TGDD made a net profit of 619 billion dong, down more than 60% compared

to the same period in 2021 This is also the quarter that recorded the lowest profit since the third quarter of 2018

In the whole year of 2022, the company achieved a revenue of 134,722 billion VND, an increase

of 8.5% compared to 2021 and achieved 95% of the plan TGDD and Dien May Xanh chains contributed VND 35,000 billion and VND 69 trillion in revenue, respectively

An Khang pharmacy chain brought in VND 1,500 billion and AVA chain (including AV AKids and AVASport) contributed 600 billion in revenue Particularly, fashion chain AV AFashion closed

in 2022 due to inefficient operation

The Bach Hoa Xanh chain, after being reformed from the beginning of 2022, has brought in revenue of VND 27,000 billion for the parent company Currently, the average revenue/store/month in the fourth quarter of Bach Hoa Xanh reaches VND 1.37 billion - increased

by 45% compared to the first quarter of 2022

Deducting costs TGDD achieved VND 4,100 billion in after-tax profit in 2022, down 16% compared to 2021, only fulfilling 64.5% of the plan approved by the general meeting of

shareholders

The company believes that MWG 2030 is the No 1 corporation in Southeast Asia in retail, e-commerce, and related services, trusted by Customers for their dedicated service and outstanding products and services Bringing Kindness, Joy, Prosperity and Pride to Employees Great Contribution to Social Responsibility, as proof of integrity and humane operations wherever MWG is present

Supermarket industry in Vietnam will be examined through Porter’s Five Forces framework as

the following analysis

2.1.1 The rivalry between existing sellers in the market

Joining WTO has made Vietnam’s retail be more competitive, so this also has led to a decrease

in price RNCOS analyzes that international retailers will try to capture the Vietnam retail market and domestic retail shops that will not be able to compete with them Most Vietnamese

supermarkets are small and independent, they couldn’t dream of competing against international

giants The giant international retailers are fully prepared to lose money for an extended period, selling products cheaper than Vietnamese competitors, to win the market share, even if it means driving an untold number of local businesses out of business The largest and strongest of domestic retailers might now consider joining hands to lower prices, improve quality and selection, and become more service oriented Looking at what is in store, they might create a united force-a strong network of wholesale distributors/dealers and cooperate with large international business groups to effectively be cooped by them

2.1.1.1 Vietnam Retail Market Analysis

Vietnam Retail Market is expected to achieve a CAGR of 3% during the forecast period While

the COVID-19 crisis impact was felt globally, Vietnam’s effective control of the pandemic led to

the recovery of retail sales of consumer goods and services in 2020's final months The growth rate, while remaining lower compared to the 12.7% recorded the previous year, was an encouraging sign for the business community amid the global retail market suffering a plunge in revenue during the pandemic Retail sales growth rate by year-end was due to retailers and shopping malls offering sales promotion programs to stimulate domestic consumption Vietnam is seeing ongoing urbanization and evolving demand trends among young urban consumers to drive strong growth in modern retailing channels such as departmental stores and the rapid expansion of e-commerce Indeed, the growing influence of such factors can be seen in the emergence of formats such as mini supermarkets, which target the demand for grocery shopping that fits into the flow of busy urban lifestyles

Modern retail outlets offer private brands/products that can be exclusively purchased in their stores Supermarkets offer products that are better suited for the daily needs of the average consumer Food products, non-food products, and home appliances are also offered in supermarkets, which makes shopping easier, as they offer everything needed for the customers

under one roof To further improve the shopping experience, some stores have in-house bakeries and cafés where consumers can hang out and enjoy themselves with family or friends

Individually, customers have very little bargaining power with retail stores It is very difficult to bargain for a better price of products But Vietnamese consumers are more and more

knowledgeable in terms of choosing products or deciding the price, so retailers would consider the quality of services as well as products Many supermarkets in Vietnam have experienced some campaigns of ostracizing products that are harmful or unclear in origin Furthermore, the switching cost is low as buyers can easily find many sellers in open-markets, small stores or neighborhood shops

The power of suppliers is moderate Although a tremendous number of suppliers have provided goods or logistic services in Vietnam, a few of them can match required standards It leads to some key suppliers trying to put up the price

The barrier for new entrants is not strong, because the size of the market is big, the government has opened the market for FDI However, in recent years, Vietnam is lacking space for developing a new chain of supermarkets (VOV News), so new entrants will face the challenges

in finding the location as well as negotiating in renting premises

Being aware of challenges as the foreign firms are allowed to set up business in the retail industry, many Vietnamese enterprises have actively banded together to build large-sized and competitive distribution systems As a result, the establishment of the Vietnam Distribution Association Network Development and Investment Joint Stock Co (VDA) was seen as the start

of an industry trend geared towards greater cooperation between retailers

The tendency in retail is not to specialize in one good or service, but to deal in a wide range of products and services This means that what one store offers you will likely find at another store Retailers offering products that are unique have a distinct or absolute advantage over their competitors

3 SWOT

3.1.1 Great financial resources from the parent corporation The Gioi Di Dong (Mobile World JSC - TGDD)

After nearly 8 years of listing, the market capitalization of the largest retailer in Vietnam - Mobile World Investment Joint Stock Company -MWG has surpassed USD 5 billion, equivalent

to nearly VND 114.2 trillion When it was released in July 2014, the company’s initial valuation was just over 5,100 billion dongs This is the strength to pay attention to when analyzing the SWOT model of Thegioididong

Currently, Mobile World JSC has a network of more than 4,500 stores nationwide MWG operates the retail chains thegioididong.com, Dien May Xanh, and Bach Hoa Xanh With market capitalization reaching the highest level in history, in 2022, MWG continues to set a high growth target with expected consolidated net revenue of VND 140,000 billion and profit after tax of VND 6,350 billion, up 14% and 30% respectively compared to 2021

Currently, Mobile World JSC has a network of more than 4,500 stores nationwide MWG operates the retail chains thegioididong.com, Dien May Xanh, and Bach Hoa Xanh With market capitalization reaching the highest level in history, in 2022, MWG continues to set a high growth target with expected consolidated net revenue of VND 140,000 billion and profit after tax of VND 6,350 billion, up 14% and 30% respectively compared to 2021

3.1.3 Extensive point-of-sale system

Established in March 2004, Mobile World had only 4 stores in Ho Chi Minh City in the first two years, specializing in mobile phones In 2007, MWG persuaded Mekong Capital to invest to increase the number of chain stores to 40 in 2019, creating momentum for the business to expand into the consumer electronics industry with the brand Dienmay.com (now known as

Dienmay.com (now known as Dienmay.com) changed to Dienmayxanh.com) a year later

By the end of 2012, TGDD had a total of 220 stores specializing in selling mobile phones in Vietnam This helped Robert A Willett-former CEO of BestBuy International and CDH Electric Bee Limited to decide to invest in MWG (May 2013) With the ambition to become an e- commerce giant in 2017, MWG negotiated the merger and acquisition of the Tran Anh electronics retail system then with 34 supermarkets of computers, mobile phones, and

electronics

In June 2017, MWG brought a bell to beat people when opening the first BigPhone store in Cambodia, the area of each store is only about 150-200m2 In June 2020, BigPhone was transformed into Bluetronics - operating under the model of Dien May Xanh in Vietnam Mobile World's Bluetronics electronics chain in Cambodia has 50 stores, covering 13/25 provinces, and the monthly revenue in Cambodia is about 165 billion VND MWG is aiming to open 30 more stores by the end of this year to cover 25/25 provinces and cities in this

neighboring country and will stop at this number

As of November 2017, Mobile World Company has opened 668 new supermarkets, with 117 thegioididong.com supermarkets, 351 Dien May Xanh supermarkets and 200 Bach Hoa Xanh supermarkets This result brings the total number of operating supermarkets of the company to 1,923 supermarkets, an increase of more than 50% compared to the beginning of the year Also

in the 11 months of 2017, the system's revenue reached nearly VND 59,000 billion

By 2018, the total number of stores had reached 2,160 stores, present in all 63 provinces According to TGDD’s business report, by the end of January 2021, this system owns 4,157 stores, of which the Thegioididong.com chain is 908 stores, Dien May Xanh is 1,500 stores and chain Green Department Store has 1,749 stores This is the strength to pay attention to when analyzing the SWOT model of TGDD

3.1.4 Strong Digital Marketing activities

Relying on large resources in the field of information technology Mobile World has built a content management system (CMS) The CMS system with basic SEO standards has contributed

to the content production team to complete the SEO standardization process easily

Next, Mobile World Joint Stock Company built a team specializing in content production They produce standard SEO content to conduct initial testing From there, analyzing, searching, and presenting the content is the biggest concern of Smartphone users

Up to now, Mobile World has produced a lot of different large and small content But the biggest and most successful content is the 24h technology column, also known as technology news This website will provide the latest information on electronic devices You can easily find information here without feeling uncomfortable like pure sales pages

Once they've set up the content system, they open comments and reviews Thus, customers can share their opinions and views about Smartphone products here Thanks to the implementation of this effective marketing strategy, the number of visits to this company's website has increased by

1 million times per month

Mobile World stores always launch many attractive promotions Including promotions when buying iPhones from this company This program is applied to customers who buy iPhones from the company When buying any iPhone, customers will receive a special voucher worth 100,000 thousand VND This voucher is usually applied when buying scratch cards or buying game

cards

In addition to regular promotions, the company also focuses on several advertising activities Mobile World Company has implemented outdoor TVC advertising activities Outdoor TVC is designed with vivid advertising images, vibrant colors and extremely eye-catching At the same time, its TVC is also located in favorable locations such as: Le Van Luong intersection, Hoang Dao Thuy, etc

3.1.5 Good customer service

Customers are the main factor bringing profits and leading to the success of companies Therefore, with a culture of putting customers first, TGDD is committed to always giving

customers the most enjoyable and satisfying experiences During 15 years of establishment and development, the business has had great success and has become a brand that has received a lot

of trust from customers and partners

One of the core factors that differentiate Mobile World's effective customer service is open and historic communication with customers Employees always put customers first and must respect their customers At the mobile world's businesses, customers always come in excited and leave happy Whether customers buy or not, they still receive enthusiastic care and advice The friendliness and politeness of the staff is one of the reasons customers close to buy a product and want to return to the store or not In this regard, TGDD has done very well, very effectively The business has been building exceptional customer service with a culture of putting customers at the center of all its actions and thoughts Thereby, TGDD constantly builds a team of staff with dedicated, thoughtful, and professional service style The employees of the business are also trained that some strict processes can be bypassed to ensure the best customer service

3.2.1 Decreased inventory turnover

With more than 80% of the inventory stocked in the form of electronic products at the end of the first quarter of 2020, controlling and rotating inventory quickly is a problem that TGDD must solve before this inventory decrease in value due to the introduction of newer models into the

market

3.2.2 The structure inside the branch is small

Another weakness of TGDD is the small internal branch structure Compared to other competitors like FPT or Viettel, TGDD needs to expand its branches more to be able to compete with rivals more effectively This is the weak point to pay attention to when analyzing the

SWOT model of TGDD

The number of stores Thegioididong.com - a technology product business chain of Mobile World Investment Joint Stock Company (MWG) in January 2021 shows that MWG's "journey" to shrink Thegioididong.com store is still have not stopped

According to data, by the end of 2020, Mobile World owns 913 Thegioididong.com stores, down

20 stores compared to the end of November 2020 and 35 stores down compared to the end of October 2020 15 stores in October and 20 stores in November, Thegioididong.com This is the weak point to pay attention to when analyzing the SWOT model of TGDD

3.2.3 Mobile phone and consumer electronics outlets see no growth

According to newswire VnExpress, MWG's business report for the first half of 2017 revealed that the company's revenue and after-tax profit were more than VND 31.2 trillion ($1.4 billion) and VND1 trillion ($44 million), respectively, producing a growth of 59 and 28 per cent compared to the same period last year

Of the total, the revenue from online sales was nearly VND2.6 trillion ($114.4 million), nearly double of the corresponding period last year

This result indicates that MWG has achieved nearly half of its annual targets of VND63.3 trillion ($2.8 billion) of revenue and VND2.2 trillion ($96.8 million) of constituency after-tax profit These targets were approved by its shareholders in early 2017 MWG has opened 272 outlets in the first half, with DiIEN MAY XANH stores accounting for over a half Currently, there are 1,527 MWG stores all over Vietnam

According to Ho Chi Minh City Securities Corporation (HSC), MWG's chain of TGD stores is showing signs of saturation Although these stores contribute the largest portion of MWG's revenue, the groDwth rate is slowing down Its market share remains at 42 per cent, while it used

to rise by 1-2 per cent in each quarter

This slowdown may be the result of the boom in TGDD stores in various prime locations across Vietnam The store-opening rate is higher than the general growth rate of the whole market, which forces TGDD stores to compete, leading to the unchanged market share

Regarding DIEN MAY XANH outlets, MWG keeps its expansion plans In the first half of 2017, its revenue growth nearly reached the target of 12 per cent compared to the same period last year This chain has much room to develop in tier-2 cities in Vietnam and MWG may gain more market share through its chain of small retail stores

Regarding the pandemic, such as buying cheaper alternatives (48%), proactively working stay at home, eat at home, don't need to buy new clothes

Usually, when finances are tight, people cut their spending to a certain extent and still be able to treat themselves to a few special treats But now, consumers adopt money-saving tactics across all categories

3.2.4 Generations of complex purchases

Market experts say that the pillars of the current FMCG consumer market are Gen Y (1981 - 1995) and Gen Z (1996 - 2014) This is also the main customer of this industry

If Gen Y has partly experienced difficulties from the economic crisis in the period 2008-2010, then Gen Z, the generation born and raised with technology will face the coming crisis for the

first time

According to Forbes, the young generation's aspect of experience is changing Deloitte's 2022 Gen Z and Millennial (Gen Y) survey shows that the biggest worry is their precarious financial background in an increasingly expensive world

The most urgent concern of this generation is no longer the need to experience and enjoy life The shift of interest in the survey shows the market reality

When the cost of living, including rent, transportation and electricity and water bills, was the top concern for 29% of Gen Z workers Meanwhile, 46% shared that their entire income is only enough to cover living expenses, not saving any money Only 25% of these can comfortably be spent monthly

3.3 Opportunity

3.3.1 Online shopping trends increase strongly

Since 2018, online shopping has been on a strong trend By 2020, this form of shopping will grow faster than ever Online shopping channels are mainly e-commerce exchanges (e- commerce), followed by social networks It is the inherent benefits of e-commerce that quickly create opportunities for online shopping activities to develop smoothly

Specifically, finding products and services through the internet will be much faster and cheaper Using the internet will also help consumers discover more goods and find products and services

that are more suitable for them

Besides, the ability to interact with customers through online shopping is also much easier than traditional shopping

3.3.2 Potential of the integrated retail industry “offline to online”

Traditional retail channels currently account for 90% of the consumer retail market share in Vietnam Modern retail has a modest market share of about 8% However, this proportion is forecasted to change rapidly in the future when modern retail is "blooming" strongly

Domestic retailers have made great strides as business results have continuously improved The strategy of parallel development of existing and online sales channels is expected to create a

“breakthrough”, changing the face of retail in Vietnam

The entry of modern retail has significantly closed the gap in gross profit between manufacturers and retailers This fact has happened in many countries such as the US and Thailand Over the next decade, gross profit as well as the ability to dominate consumers will shift dramatically

from manufacturers to retailers

Currently, traditional retail channels still account for 90% of the market share of retail consumption in Vietnam However, this number will decrease rapidly in the future The reason and characteristics of the traditional retail channel are small scale, dispersion, and limited-service standards This means that consumers are now paying more for everyday essentials in the essentials segment

3.3.3 Mobile phone accessories market thrives

According to a survey, the total number of smartphone shipments in the third quarter of 2021 reached 342 million units For every phone sold, consumers will need additional products such as bundled headphones, charging cords and many other technology accessories As a result, businesses in this industry benefit

According to research firm Research and Markets, the phone accessories market in 2020 will reach more than 202 billion USD With an annual growth rate of 4.5% is expected to reach more

than 328 billion USD by 2030

Research shows that in Latin America, sales of wireless speakers are growing strongly Meanwhile, the North American and European markets have a high proportion of sales of high-

end devices, power banks and special-use accessories As in Asia, the demand for data storage is increasing, so the products that support large capacity storage are loved

3.4.1 Fierce competition with FPT Shop

FPT Shop is managed by FPT Digital Retail Joint Stock Company (referred to as FPT Retail) established in 2012 As of January 2021, FPT Shop has 634 stores spread across 63 provinces and cities water This is a challenge to watch out for when analyzing TGDD's SWOT model Meanwhile, Mobile World Joint Stock Company (TGDD) has a network of nearly 4,200 stores nationwide, including more than 900 mobile world stores, more than 1500 Dien May Xanh stores and about 1,700 stores Green Department Besides the Vietnamese market, the group also expands to foreign markets with 50 retail chains of mobile devices and electronics in Cambodia

In fact, TGDD and FPT Retail are the two biggest names in Vietnam in the field of mobile phone and electronics retail Obviously in terms of scale, Mobile World is the most overwhelming However, FPT Retail is showing that they have an advantage in one area they both jumped into

at the end of 2017, which is the pharmacy chain This is a challenge to watch out for when analyzing TGDD's SWOT model

With the merger and acquisition (M&A) strategy, Mobile World announced that it would buy back 100% of shares in the drug retail chain instead of taking 2-3 years to build its own pharmaceutical business model

In 2018, Mobile World quickly jumped into this field with Phuc An Khang pharmacy chain The signboard was changed, the name of the pharmacy changed to Ankhang.com At that time, An Khang had 26 stores with an average monthly revenue of about 2 billion VND each

As for FPT Retail, they also quickly acquired the Long Chau pharmacy chain, the largest pharmacy chain in Ho Chi Minh City, established in 2007 with 5 large pharmacies

In the following years, FPT established FPT Long Chau Pharmaceutical Joint Stock Company in

2018, then successively opened a nationwide chain of Long Chau drug stores By the end of

2020, Long Chau drugstore chain has reached 200 stores in 50 provinces and cities nationwide with sales of 1,191 billion VND, an increase of 133% compared to 2019

The retail system of FPT Shop is a retail chain of mobile digital products including mobile phones, tablets, laptops, accessories, and technology services Meanwhile, the products of the TGDD chain are similar They are the retail chain of mobile devices (mobile phones, tablets, laptops, and accessories) with the No 1 market share in Vietnam with more than 2,500 points of selling mobile devices (including nearly 1,000 TGDD stores) and more than 1,500 Dien May Xanh stores) present in 63 provinces and cities across Vietnam

Obviously, TGDD has the advantage of the forerunner with a much broader and stronger coverage than FPT Shop However, FPT Shop has an advantage that TGDD does not have, the parent company FPT Retail is the one that imports most of the phone lines into the Vietnamese market Other retail chains still must get goods from FPT Shop This makes FPT Shop always

have the goods ahead of time compared to TGDD with more competitive prices and faster warranty

The warranty period and experience are an advantage of FPT Shop when they are already the warranty receiver, the representative unit of a series of big names such as Lenovo, Dell, HP in the Vietnam market for many years year

Now, besides the main product line of mobile devices, FPT Shop has encroached on the field of home appliances and smart electronics with the "handshake" with the "giant" Xiaomi to distribute the entire Mi Eco ecosystem

According to FPT Shop, three main product groups of Mi Eco are being sold by FPT Shop including household appliances (robot vacuum cleaner, air purifier, electronic scale, camera,

lamp, smart brush, shaver, etc.) electric kettle, hair dryer, .) wearable devices (Mi Watch,

Miband), accessories (power banks, speakers, headphones, network devices, backpacks, wallets,

"

With support from Xiaomi, one of the leading brands in the production of IoT devices The Mi Eco ecosystem includes hundreds of smart products such as household appliances, wearables, accessories, etc of high quality, reasonable price, trusted by many people, and will be sold in the retail system of FPT Shop

3.4.2 Inflation affects purchasing power

Although Mobile World's business results cannot represent the overall trend of the industry However, before that, analysts said that the prospect of retail businesses in the last 6 months of

2022 will face many obstacles, especially when inflation in many parts of the world tends to increase strong

The demand for growth in the electronics segment has been very strong when people must stay at home a lot because of the Covid-19 epidemic Consumers bought last year this year it is difficult

to buy again Therefore, from now until the end of the year, it may not grow any more strongly, although this industry still has relatively positive results

The situation of the electronics and electronics market in the last months of the year is not very positive Even in the semi-air-conditioned season, the weather conditions don't seem to be favorable After 2 years of the epidemic, people's money reserves may have been used up along with many other unfavorable factors of the world economy

Macro factors are not favorable for both retail and manufacturing businesses Because over the past 2 years of the pandemic, production has not been stable, the employment situation of workers is unstable, and the money saved has been spent a lot, causing a decrease in purchasing

power

When everything was not recovered, the Russia-Ukraine conflict took place, causing the input costs of the agricultural and livestock industries to increase too sharply, the output prices to rise, and the gasoline prices to increase, leading to inflation If this conflict persists, it will greatly affect the economy, both purchasing power and profits of businesses

3.4.3 Consumers must cut spending on most non-essential items

In the context that average income has not kept pace with current inflation, Vietnam Report's survey shows that consumers must cut spending on most non-essential goods If inflation continues to increase, they will also cut spending on essential goods such as food, beverages, fast-moving consumer goods, etc

According to research by EY, consumers are very worried about the future with 63% not expecting the economy to recover within the next 12 months, so their top priority right now is

“affordability” The cost of living is a concern of all consumers when up to 79% said finance is a

concern and 35% worry about not having enough money to spend on things other than living expenses and daily activities

33% of consumers are replacing conventional purchases with new brands or switching to private labels In many ways, consumers are returning to what worked for them