final exam international marketing plan for basa fish to eus market by vinh hoan joint stock company

GROUP LY THU KY — 1921000880 TRUONG MINH MAN - 1921000917 PHAN GIA CAT TUONG - 1921003892 NGUYEN NHUT HAI LONG - 1921004477

CLC_19DMA12

HO CHI MINH CITY, 2021

TABLE OF CONTENTS

1.1 OVERVIEW OF VINH HOAN JOINT STOCK COMPANY 0 nh Hy Hà 1 1.2 HISTORY OF FORMA TION AND DEVELUOPMENÏT vn n1 H12 H111 H1 Hà 1 1.3 VISION, MISSION AND CORE VALUES 021121201111 0110111101121111 1111111 11x tre 3 R14 5)7.140.090 1000 0À/5.0 CC 3 PART 2 ANALYSIS OF BUSINESS ENVIRONMENT 4 2.1 MACRO ENVIRONMENIT Q0 20112 12 1112112011111 1112011111181 1111 111511 11x11 11H kg 4

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2.1.2 NaturaÏ envIron€TIE L1 2212211211211 121111211 1211111211 11111 1111011111111 1H HH HH Ha 4 2.1.3 ECONOMIC 2i 0n e 5 2.1.4 Legal and political enVIrOIM€IIE 1 1116211121 15111111111211 1111111 1111101 11 1101 11 11 tk, 5 2.2 MICRO ENVIRONMENTT 111121101111 1101111111111 11111 111111111111 1111 x11 111111111 Htkg 6

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E59 nh an 15 3.2.3 Remedial measures nh 16

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PART 4: INTERNATIONAL MARKETING STRATEGY OF VINH HOAN 19

4.1 INTERNATIONAL MARKETING STRATEGY OF VINH HOAN COMPANY 19

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4.3 PRICING STRATEOY L0 111 11 1100111111111 11 111 H111 11111111 HH k1 4x Hy 20 4.4 DISTRIBƯ HION STRATEOY L0 L1 2 10 01 1111111011111 111111111 HH HH HH ky 21 (00/0900) 90.200 có - 22 PART 5 CONCLUSION AND RECOMMENDATIONS 24

5.1, CONCLUSION occcccccecccccceccceetecseseescsenececsenecsesesecsereseesesstecsesscesseseciereecseteeeseserssescesseneees 24

5.2 RECOMMENDATTIONS L L2 1 112 11 T511 111 tk kg x11 ty 24

LIST OF TABLES

Table 0: Vision, Mission And Core Values .000ccccccccccccccccccsccccececcecssenesseceeseceetstentisecetesneeees 7

I 100 58000.3/2i8: 6-2) 0n 7 Table 2: Vĩnh Hoan”s Competitor Inside VIetnaim c1 SH S11 1011011011111 He 8 Table 3: Vinh Hoan”s Competitor at EU c1 1111211111111 1111110111111 01111 0111 H1 H1 1 0, 9 Table 4: Vĩnh Hoan”s food suppÏy system c1 1 212111 111111011 H HH Hà HH He, 10

Table 5: Vĩnh Hoan SWOT analyS1S Q0 010221121 12111 221111111121111 11 11 111 HH nhe 10

I0 S5O20)0b0 {ma 200g 12 Table 7: Advantages and Disadvantases of FrancÏnis1ng - c1: nS S912 121121121252 14 Table 8: Advantages and IDisadvantasees of LIC€ISIIE LnSnn SH 10 021221H te, 15 Table 9: Advantages and Disadvantases of ÏĐIrect ©eXpOTI Lnnnn SH 9 02112n re 16 Table 10: Some Decision about Direct EXpOFf - L2 1111 nn 1n 011011111 111111 111tr 17

I 10588009000 02ì1009 89.0 -.154 0n 17

Table 12: Documents need to cormpÏef€ 2 2112111 11111111111111101 1110101 1111111111111 11tr 20

Table 13: Revenue, Expense & Profit FOr€€aSE L1 9119, 11111 1H H1 HH1 He, b

Table 14: Action plan for the Í1rst y€AT c1 121101 11111111111111111 1110111111 0101 11 1111111 11 1 tk € Table 15: Basa Fish Sales & Revenue Forecast For The Next FIve Years cào d Table 16: Member’s group work assessment oồớa4 d

Figure 1: Company Organization

LIST OF FIGURES

Figure 2: Proportion of Products Exported to EU (2018) cece eerie Figure 3: Household Expenditure by EU’s consumption purpose ccc nhe

Vinh Hoan ha

VASEP

EU UK GDP EVFTA UKVFTA FTAs

IUU HACCP ISO

: European- Vietnam Free Trade Agreement : United Kingdom- Vietnam Free Trade Agreement

: Free Trade Agreements

: egal, Unreported And Unregulated Fishing : Hazard Analysis and Critical Control Point System : International Organization for Standardization

PART 1 COMPANY INTRODUCTION 1.1 OVERVIEW OF VINH HOAN JOINT STOCK COMPANY

The predecessor of Vinh Hoan Joint Stock Company is Vinh Hoan Company Limited, established on December 19", 1997 In 2007, the company transformed into a joint stock company with the name Vinh Hoan Joint Stock Company Vinh Hoan Joint Stock Company is one of the leading basa processing and exporting companies in Vietnam Vinh Hoan is a company with a scale belonging to the big enterprises in the export processing industry of the country, the total current capacity is up to 250 tons of raw fish per day The company has the advantage of raw material supply because it is located in Dong Thap Province, a province in the Mekong Delta region with the environment and conditions considered the most favorable for the farming industry of raw basa With 8 basa farming areas, total area 136.5 ha, providing 34% of raw material demand The company's products are eligible to export to many countries around the world, including the US and EU countries, the most demanding market in the food export industry from overseas markets and gradually become a brand name reputable both at home and abroad

» Trading name: VINH HOAN JOINT STOCK COMPANY * English name: VINH HOAN CORPORATION

¢ Business registration certificate number: 1400112623 ¢ Charter capital: 1.833.769.560.000 VND

¢ Address: Route 30, Ward 11, Cao Lanh City, Dong Thap Province

* Phone: +84 277 389 1166 * Fax: +84 277 389 1062 * Website: www.vinhhoan.com

¢ Stock code: VHC

1.2 HISTORY OF FORMATION AND DEVELOPMENT

- 1997: Ms Truong Thi Le Khanh founded Vinh Hoan Private Enterprise - 1998: Converting the business model to Vinh Hoan Co., Ltd

- 1999: The first fisheries processing factory in Cao Lanh Town, Dong Thap province came into operation

- 2007: Publicly listed on the Vietnam Stock Exchange Established Vinh Hoan Feed

Established Vinh Hoan USA in Milpitas, California 1

2009: Vinh Hoan Laboratory was accredited to ISO / TEC 17025:2005

2010: Become the world's largest basa producer

2012: The world's first basa producer received ASC (Aquaculture Stewardship Council) certification

2015: First company in the world to achieve 4-Star Best Aquaculture Practices (BAP) for hatcheries, feed production, farming and processing of basa Modem collagen/gelatin production facility begins production

2016: Awarded the First Class Labor Medal by the Government of Vietnam Ranked by

Forbes as one of the top 50 companies on the Vietnamese stock market for three consecutive years Established Vinh Aquaculture division to promote research, development and education as well as provide stable input for production

2017: Focus on growth and innovation through Vinh Foods division to provide a wide range

of value-added products Celebrated 20th year anniversary of Vinh Hoan's journey

2018: Locate existing markets and develop into further markets Expand farming and production capacity to ensure the supply of high quality raw materials Continue to focus on developing value-added products Increase direct distribution channels to restaurants and supermarkets

2019: In January 2019, Vinh Hoan proudly won the “Innovation of the Year” award given by Woolworths for Fish Bites; Chairman of the Board - Ms Truong Thi Le Khanh was voted by

Forbes Vietnam as one of the 50 most influential women in 2019; Vinh Hoan was honored

as one of the 50 best listed companies in Vietnam in 2019 This year is the 6th consecutive year appearing in the Forbes list since 2014; In September 2019, Vinh Hoan Pangasius Seed Production Co., Ltd started construction This new breeding area will focus on researching and developing new technologies, improving processes to produce high quality fingerlings; In November 2019, the Food Safety Inspection Service (“FSIS”) under the US Department of Agriculture (“USDA”) officially recognized the equivalent for the Vietnamese basa

industry.

1.3 VISION, MISSION AND CORE VALUES

Table 0: Vision, Mission And Core Values

Mission | Affirming the position and potential development of sustainable aquaculture in the world through

continuous improvement, environmental protection and efficiency improvement in all production and business activities

Vision | Becoming a leading company in sustainable aquaculture products, contributing to building a world of

safe, delicious, healthy food and environmental protection

Internal Audit Department General Manager }- eeeeei.i

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PART 2 ANALYSIS OF BUSINESS ENVIRONMENT

2.1 MACRO ENVIRONMENT 2.1.1 Overview of the EU’s market

European Union, also known as the European Union, (abbreviated as EU), is a political and economic union consisting of 27 member states in Europe The European Union has developed a single market through a standard legal system that applies to all member states to make sure the free movement of people, goods, services and capital The EU maintains common policies on trade, agriculture, fisheries and local development

The EU 27 market size is now 500 million people, GDP will reach 15.193 trillion USD in 2020 (according to Worldbank.org) The EU is now one of Vietnam's leading trading partners, with two- way trade increasing by 15-20% per year on average

Figure 2: Proportion of Products Exported to EU (2018)

textile (98%)

+ leather (for shoes) (11,1%) bag, suitcase, umbrella (2,2%) « phones and components (31,4%) 3.20% 2.20% — clectranics and components (11,3%)

3,40% | » machinery, mechanical equipment (4,9%)

1,80% + wooden (18%) 9 4,90% + fisheries (34%) + coffee (32%) = others (207%)

(Source: Ministry of Industry and Trade, General Department of Customs) 2.1.2 Natural environment

With a coastline of 3,200 kilometer, an exclusive economic zone of 1 square kilometer million

and a large inland water surface of 1.4 million hectares, especially the waters of the Mekong Delta have created favorable conditions for Vietnam to develop the industry aquaculture and fisheries processing In which, Tien Giang, An Giang and Dong Thap are key areas for raising basa fish in the country, which has fully met the demand for raw materials for export fisheries processing companies The characteristics of freshwater fish such as basa fish are easy to raise, less diseased, and more fertile, especially suitable for environmental conditions in the waters of the Mekong Delta.

2.1.3 Economic environment

Like other regions of the world, under the impact of the COVID-19 pandemic, the European Union in the past year saw many unprecedented changes and challenges in history For the EU area, in the first quarter of 2020 recorded a decrease of 2.7% and the strongest decline in the second quarter of 2020 with a decrease of 13.8%

The COVID-19 crisis has sent shock waves through the EU food supply chain in 2020 Furthermore, EU agriculture is heavily dependent on cross-border seasonal workers and these factors are increasingly exposed by the crisis, which could push millions of EU citizens into poverty, especially those in poverty vulnerable objects Among the negative factors caused by COVID-19, this is a positive signal for Vietnam's food export industry to Europe, especially fisheries exports

2.1.4 Legal and political environment

The European market is considered the most rigorous market in terms of import control, the company needs to understand the regulations to be able to deploy the most effective sales strategies

Food safety | Products found to be non-compliant will be reported in the Rapid Alert System for Food and

standards Feed If the company is on that list, its containers will be thoroughly inspected at the port of

must be met | entry In addition, constant temperature control is recommended To import into the EU, a hygiene certificate is required with the product Health and hygiene are important to customers

Make sure that there are no contaminants in the finished product

Chlorate The European Union has not yet established a specific maximum residue level for chlorate in

control food, and a default MRL of 0.01 milligrams/kg applies The European Union is working to

strengthen regulation of residue levels in food and water Even at the default MRL, the product is often violated because of its higher chlorate content At the end of October 2019, a few

shipments of frozen basa fillets with added water from Vietnam were found to have higher chlorate levels and were put on the RASFF quick alert

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rules when exporting

Non-tariff In an EU member state, Romania, recently, on online newspapers such as Realitate.net, barriers Ziuanews.ro, Bzi.ro, Adevarul.ro, Puppe.ro, Secretulsanatatii.net inaccurate information about Vietnam's basa fish industry, which is harmful to export activities to this country Some other websites recommend that the people of this country boycott basa fish and restaurants with this fish menu Because the situation of exporting basa fish to the European market decreased due to smear media in some countries in Europe, VASEP signed a contract with Globally Cool Company to catry out a campaign to promote Basa fish at this market from March to December 2017

(Source: VASEP)

2.2 MICRO ENVIRONMENT 2.2.1 Competitors

2.2.1.1 Direct competitors

a Inside Vietnam: Organizations that give the same product or service and use in the same

market as a business such as:

Table 2: Vinh Hoan’s Competitor inside Vietnam

2 Bien Dong Fisheries Co., Ltd Fish Lt 2020 100.4 : 6.73% :

3 | IDL Multinational Development and 2019 118.2 5.91% Investment Joint Stock Company 2020 78.1 5.23% : 2019 94.7 4.74% 4 | Go Dang Joint Stock Company 2020 66.5 4.46%

(Source: VASEP)

b At Europe: Currently, there is no significant competitor for Vietnam in the EU market Most basa fish products exported to the European Union originate from Vietnam

Table 3: Vinh Hoan’s Competitor at EU

Bangladesh Due to supply chain issues, Bangladeshi exporters are often unable to sell to demanding high-end

markets such as the retail sector, where certification for traceability, quality and durability is often required Instead, Bangladeshi basa is often in the lower end of the foodservice market

Potential competitors are businesses that are not present in the fisheries industry or are new to

the industry but have not provided services and it may affect the industry in the future The entry of

new enterprises will increase the level of competition among enterprises in the same industry, however, this level of competition will depend on factors and conditions for entering the industry as

follows:

With many signed agreements such as EVFTA, UKFTA, along with a lot of government attention to develop the national fisheries industry, the industry's attractiveness becomes great: Technology; Capital requirements; Commercial factors: Distribution system, brand, customer system; Specific resources: Inputs (controlled), patents Human resources, government protection; Distribution channel

2.2.1.3 Alternative products

In addition to the competition among basa products, it also must compete with other catfish of the world and substitute products such as tilapia, salmon, pangasius, and other types of white-meat fish as well as other fisheries When people's income is high, the people's demand for food is also

high, which requires food quality, safety and hygiene, and the ability to choose If the Vinh Hoan's

products do not meet the needs of customers, the substitute products will affect the company's business performance.

2.2.2 Product supply

Vinh Hoan continues to produce and plans to invest 580 billion VND in projects such as building new hatcheries, renovating existing farms, and expanding production plants In 2020, Vinh Hoan also announced that it 1s building a fish oil factory in Chau Thanh district, Dong Thap province The advantage of closed chain and the advantages of management capacity, technology and technology have helped Vinh Hoan surpass small and medium-sized enterprises in purchasing raw materials as well as penetrating large markets

Table 4: Vinh Hoan’s food supply system

Fingerling Fish fingerlings are an indispensable part of the farming process and now Vinh Hoan owns over

30 hectares of breeding area Fish farming process is divided into several stages as follows:

Fish egg (2 weeks) — Newly hatched fish (3 - 4 weeks) — Fingerling

Vinh Hoan develops fish farming from the stage when the newly hatched fish are bought from the hatchery, this is the stage when the fish are just big enough, easy to raise, and easy to control in

terms of feeding food

Aquatic food The source of fish feeding food is mainly provided by Vinh Hoan 1 Joint Stock Company, once a subsidiary of Vinh Hoan and now sold to a Philippine partner After the resale, Vinh Hoan became the official distributor, continuing to buy back food from its partner at a low price and quality, because the new partner was able to focus on R&D to improve the recipe to help increase

nutritional value and limit environmental pollution

Raw fish farming

activities Recirculating fish farming project without water change:

This is the first project that the company has successfully researched and applied the model of raising river fish in ponds in the farming area of Tan Hung, Long An

2.2.3 Customer

The target customer is all European people, regardless of age or status, because basa fish is white-meat fish, neutral taste, competitive price and easy to prepare into many dishes Moreover, the trend of choosing and paying a higher price for natural, organic products, clearly labeled with recognizable ingredients, with minimal impact on the environment is also gradually gaining popularity in the market of developed and developing countries

+ A dedicated and professional workforce and a good, committed and experienced management team; * Having a wide understanding and connections in different foreign markets to support brand promotion and development strategy;

* Healthy financial situation with high accumulation

* The COVID-19 epidemic affects the import demand of key markets;

+ Shipping costs increased from the fourth quarter of 2020 and showed no sign of cooling down; * Competitors are growing stronger and more developed;

* Customers’ consumption trends are always fluctuating;

* Increasing domestic demand for raw materials leads to the risk of shortage

2.3.5 S — O strategy: Take advantage of product strengths (quality and output) and take advantage of external conditions to penetrate the market

2.3.6 W — O strategy: Building a strong brand, effectively mobilizing capital, managing human resources well to penetrate the target market

2.3.7 S —T strategy: Promote the strengths and advantages of the company to limit the threats of the market and competitors

2.3.8 W — T strategy: Overcome weaknesses in brand, capital, and human resources to prevent threats

2.4 DESCRIPTION OF TARGET MARKET 2.4.1 Main markets of Vinh Hoan Company

In terms of revenue by market, most markets have decreased compared to 2019 and 2020 due to

the impact of the pandemic, mainly due to food service chains, which are one of the two main consumption channels In 2020, Vinh Hoan sold to 47 markets, an increase of 9 markets compared

to 2019 In which, the 3 largest markets are the US , Europe (including the UK) and China

2.4.2 Europe market

The bright spot of the market in 2020 is the growth of the Europe market Europe so that a block pass China the 2™ largest market after the United States of Vinh Hoan, accounting for 18% of total revenue

Behavioral Most consumers in Germany are interested in preserved and processed fisheries products A notable

segmentation | trend is the development of new fisheries products for special occasions or for special enjoyment

such as Spanish savory dishes, fish appetizers, sushi and breaded products If fisheries is more

conveniently ready and consumers are taught how to cook it, sales of fisheries could increase

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Figure 3: Household Expenditure by EU’s consumption purpose

Source: Eurostat (online deta code:.nema.10.ca3 g0) eurostatm

(Source: eurostat)

2.4.2.3 Competitive advantage of Vinh Hoan Company

It is thanks to Ms Le Khanh assertiveness in leadership that she has made the right and timely strategic decisions Since then, Vinh Hoan is not passive when the price of raw materials increases in the market, improves productivity, reduces costs and costs when realizing that the market demand is growing or pioneering in research and processing Basa products, basa fish into high value-added products such as breaded basa, artichoke rolls Ms Le Khanh showed excellent talent and bravery when helping Vinh Hoan gain a huge competitive advantage over rivals

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