Final report group project building an mis solution for kido group

AND FINANCE FINAL REPORT GROUP PROJECT BUILDING AN MIS SOLUTION FOR Additionally, KIDO's expansion into the confectionery sector has faced difficulties in building brand recognition and

AND FINANCE

FINAL REPORT GROUP PROJECT

BUILDING AN MIS SOLUTION FOR

Additionally, KIDO's expansion into the confectionery sector has faced difficulties in building brand recognition and increasing market share To address

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these issues, it is essential to explore and propose effective solutions that can help KIDO resolve its raw material supply issues and boost sales in the confectionery sector.

2 Objectives of the Study

This project aims to:

 Improve operational efficiency in KIDO’s confectionery sector to support brand development

 Enhance internal communication, data management, and adaptability within KIDO’s business units

 Propose a strategic framework for implementing solutions aligned with KIDO's business objectives and market challenges

The report will cover:

 Analysis of KIDO’s current business strategies and operational processes

 Identification of specific challenges within KIDO's supply chain and brand management

 Detailed planning for solutions to support KIDO in addressing its ongoing challenges

 Recommendations for implementing these solutions with consideration for scalability and cost efficiency

3 Research Object and Scope

 Research Object: The study focuses on supply chain management in KIDO’s

cooking oil sector and brand strategy in the confectionery sector

 Scope: The report is limited to essential aspects of KIDO’s supply chain and

brand management to provide feasible solutions, without delving into specific production processes

4 Report Structure

The report is divided into the following main chapters:

 Chapter I: Overview

 Chapter II: Introduction

 Chapter III: Company Analysis

 Chapter IV: Analyze the problem

 Chapter V: Proposal solutions and Implementation

 Chapter VI: Conclusion and Recommendations

By conducting a comprehensive study, this research will provide a clear understanding of the current situation and feasible solutions to improve the

information system of KIDO GROUP.

II INTRODUCTION

1 Company Overview [1]

 Vietnamese name: CONG TY CO PHAN TAP DOAN KIDO

 English name: KIDO GROUP CORPORATION

 Abbreviation name: KIDO GROUP

2 History of Establishment and Development

Established in 1993, KIDO was formerly known as Kinh Do Construction andFood Processing Co., Ltd The company mainly operates in the field of production, processing and distribution of consumer food products such as cooking oil, ice cream, confectionery, snack food and beverage KIDO has officially operated underthe model of a JSC since 2002 with a charter capital of VND 150 billion

 1993: Kinh Đô was founded.

 2000: Established Kinh Đô Northern Company.

 2003: Acquired Wall's ice cream factory from Unilever and established

KIDO'S Company Limited

 2004: Kinh Đô Northern (NKD) issued shares for the first time.

 2005: Kinh Đô Group launched its initial public offering.

 2008: Acquired the majority of shares in Vinabico.

 2010: KDC, NKD, and KIDO'S merged to form Kinh Đô Group.

 2014: Entered the essential goods sector with its first product being Đại Gia

Đình instant noodles

 2015: Sold 100% of its confectionery segment shares to Mondelez

International

 2016: Acquired 65% of shares in Tường An Vegetable Oil JSC and owned

24% of shares in Vietnam Vegetable Oil Industry Corporation – Vocarimex

 2017: Held 51% of shares in Vietnam Vegetable Oil Industry Corporation –

Vocarimex and invested 50% in DABACO Food Processing Co., Ltd

 2018: Acquired 51% of shares in Golden Hope Nhà Bè and established

KIDO Nhà Bè Co., Ltd

 2020: Entered the confectionery and beverage industry and expanded its

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market share in the edible oil and ice cream sectors Additionally, KIDO Foods merged into KDC.

 2021: Launched the Chuk Chuk brand (coffee and milk tea chain).

 2022: Returned to the mid-autumn festival goods sector with the KIDO's

Bakery brand

 2023: Acquired 68% of shares in the Thọ Phát brand and launched the

seasoning products segment

3 Organizational Structure

Figure 1：The Organizational Structure of KIDO Group (Source: [2])

4 Main line of Business [2]

 Wholesales food

 Specialize in the production and trade of food and beverage products, including ice cream, dairy products like milk, non-alcoholic beverages, and mineral water

 Focus on the production, export of products derived from oils, animal and vegetable fats, oilseeds, and coconut jelly; engaging in the manufacturing and trading of various types of packaging materials; exporting raw materials

to support the processing activities of vegetable oil business unit

5 System of Products [2]

The KIDO's product portfolio can be broadly categorized into:

 Daily Essential Foods: Kido offers a wide range of food staples, including

cooking oil, seasonings, dry food, which form the backbone of Vietnamese cuisine

 Frozen Foods: Recognizing the growing demand for convenient food

options, Kido has ventured into the frozen food segment with products like ice cream, dessert, and frozen foods

 Snack: To cater to the taste preferences of the younger generation, Kido has

a strong presence in the snack food market with a variety of bread, cookies, and festival gifts

Figure 2: The Products’ System of KIDO (Source: [2])

 End consumers are divided into three main market areas:

o Urban areas: where high-income consumers prefer a wide variety of

products with high-quality standards and attractive designs and styles

o Rural areas: where consumers with middle to low income demand

good quality products, less concern for design, and affordable prices

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o Mountainous areas: where consumers have very low income, require

moderate quality, are not concerned with design, prioritize weight, andexpect very low prices

 Intermediary companies and agents form a nationwide distribution network spanning from the North to the South

7 Business Model [2]

Figure 3: The Business Model of KIDO (Source: [2])

Kido's business model demonstrates a comprehensive approach in covering various segments of the food industry, ranging from basic cooking ingredients to ready-to-eat products The company categorizes its products into main lines, including oils and fats, frozen foods, processed foods, spices and sauces, along withOEM products and partnerships for items such as sugar, spices, drinking water, andinstant noodles These product lines are managed and developed by subsidiaries such as VOCARIMEX, TUONG AN, KIDO NHA BE, KIDO FOODS, THO PHAT, and DABACO FOODS

Kido employs a diverse distribution system, including channels for dry products, frozen products, import and export, B2B, and seasonal distribution channels, ensuring extensive reach both domestically and internationally With a network of 450,000 sales points for dry products and 120,000 for frozen products across Vietnam, along with export activities to international markets, Kido has established a robust and efficient distribution network Supporting its operations, Kido invests in key functions such as administration, finance, product research and development, logistics, marketing, and technology All these elements enable Kido not only to meet domestic demand but also to enhance its competitiveness in the

global market while strengthening the trust of Vietnamese consumers.

8 Business Result of 2023 [2]

Figure 4: Total Assets of KIDO from 2019 to 2023 (Source: [2])

2023: Total assets continued to increase but at a lower rate compared to the

previous period This indicates that the company is maintaining stability and continuing to grow, but may not have achieved the expected growth level

Figure 5: The Net Revenue of KIDO from 2019 to 2023 (Source: [2])

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2023: Revenue continued to rise, although the growth rate has not yet reached

the previous level This suggests that the company is striving to recover and maintain growth in a challenging business environment

Figure 6: The Gross Profit of KIDO Group from 2019 to 2023 (Source: [2])

2023: Gross profit decreased compared to the previous year, which could be

due to various reasons

Figure 7: Profit before tax of KIDO Group from 2019 to 2023 (Source: [2])

2023: Profit before tax continued to decline but at a slower pace than the

previous year

III COMPANY ANALYSIS

A Porter’s Five Forces Model

of intermediary retailers and agents is not significant

Figure 8: distribution network of KIDO GROUP (Source: [2])

 However, KIDO’s main products, such as cakes, candies, milk, and ice cream, are relatively low-cost items This low switching cost makes it easy for customers to turn to competing brands, creating pressure for KIDO to continuously develop new products to satisfy customer demands Despite this, KIDO remains a well-loved and trusted brand among individual customers, so the pressure from this customer segment is significant

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Figure 9: Some Products of KIDO (Source: [2])

2 Suppliers' Power

KIDO’s suppliers of raw materials can be categorized into various groups, including flour, sugar, dairy, flavors, and additives Key suppliers include:

 Flour: Bình Đông, Đại Phong

 Sugar: Biên Hoà Sugar, Juna Sugar, Bonborn Sugar, Phú Yên Sugar

 Dairy: Mainly sourced internationally, either through direct import or local

distributors and agents

 Flavors and Additives: Primarily international suppliers accessed through

representative offices or distributors in Vietnam, including brands like Mane,IFF, Griffith, and Cornell Bros

 Regarding packaging: Kido mostly uses domestic suppliers, such as

Visinpack for paper packaging, Tân Tiến for plastic, and Mỹ Châu for tin packaging

KIDO is a major client for these suppliers and there are numerous alternatives,the bargaining power of suppliers is quite low Therefore, the pressure from suppliers on KIDO is not substantial

3 Threat of Substitute Products or Services

 Confectionery products are not essential daily items but rather supplemental treats, so if prices, quality, and designs don’t align with consumer tastes, retaining customers can be challenging In addition, consumer demand for these products constantly shifts Substitutes that Kido faces include alternatives made from different raw materials that meet consumer needs, such as jams and fruits

 Currently, many consumers tend to choose homemade sweets over packaged goods, adding more pressure on KIDO’s products The rise of new products from other sectors, such as dried fruit and nuts, has also impacted KIDO's confectionery line

pre-4 Threat of New Entrants

 Vietnam’s membership in various large global economic organizations has

made it easier for confectionery companies from other countries to enter the market, intensifying competition within the industry.

 The Vietnamese confectionery market still holds growth potential, and the increasing demand for food attracts many new businesses KIDO faces considerable pressure from these new entrants

5 Rivalry Among Existing Competitors

 Vietnam’s confectionery industry currently features many manufacturers with diverse production and business scales KIDO faces fierce competition from domestic brands like Bibica and Hải Hà and international brands like Mondelez and Lotte

 The market offers a wide range of products, from cookies and bread to candies and nutritional items This variety intensifies competition regarding price, quality, and product diversity

B SWOT [3]

1 Strength

Kido Group possesses a unique set of advantages that set it apart from its competitors:

 Deep consumer connection: The Kido Group has cultivated a deep

connection with Vietnamese consumers through its beloved brands, including Kido, Merino, and Tuong An, which have become synonymous with childhood memories and fostered a strong sense of trust

 Extensive Distribution Network: From small grocery stores to large

supermarkets, Kido products are readily available nationwide, ensuring widespread reach

 Continuous Innovation: By consistently investing in research and

development, Kido Group introduces new products that cater to the evolving tastes and preferences of consumers

 Product Diversification: Kido does not solely focus on one product group

but diversifies its product range, mitigating risks and boosting revenue

2 Weakness

Besides its outstanding strengths, Kido Group also faces some limitations:

 Intense Competition: The fast-moving consumer goods market is

increasingly competitive with the emergence of many domestic and foreign brands

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 Dependence on Domestic Market: Although there have been efforts to

expand into foreign markets, Kido's revenue still primarily comes from the domestic market

 Difficulty in Innovation: Maintaining a traditional brand image may limit

the ability to innovate and adapt to new consumer trends

 Marketing activities - need for a breakthrough: Compared to other "big

players", Kido Group's marketing activities seem to be not really outstanding

and have not yet left a strong impression on consumers

3 Opportunities

The market is always brimming with new opportunities, and Kido Group is well-positioned to seize them and soar to new heights:

 Healthy Consumption Trends: Consumers are increasingly

health-conscious, presenting a golden opportunity for Kido Group to develop premium, organic product lines that cater to this growing demand

 Growth of the Middle Class: The growth of the middle class in Vietnam

opens up opportunities for premium and diversified products

 E-commerce Boom: The rapid growth of e-commerce offers a new, efficient

distribution channel, enabling Kido Group to reach customers quickly and conveniently

 Government Support: The government's supportive policies for businesses

create a favorable environment for Kido Group to expand its market reach

4 Threats

The market is constantly evolving, and Kido Group is no stranger to its share

of challenges:

 Fierce Competition: Operating in the highly competitive confectionery and

food sectors, Kido must contend with established domestic and international brands that offer a wide range of products and marketing strategies

 Raw Material Price Volatility: Fluctuations in the prices of key

commodities, including sugar and dairy, can significantly impact Kido Group's production costs and profitability, making it challenging to maintain stable margins

 Rapidly Changing Consumer Tastes: The evolving preferences of

consumers, driven by health and wellness trends, demand for natural and organic products, and a growing emphasis on sustainability, necessitate constant product innovation and brand repositioning for Kido Group

 Food Safety Regulations: Stricter food safety regulations require Kido to

invest more in quality control

5 Conclusion:

Kido Group possesses numerous strengths but also faces significant

challenges To sustain and grow, Kido needs to maximize its strengths, address weaknesses, seize opportunities, and be prepared to face threats

IV ANALYZE THE PROBLEM

for Cooking Oil Production

KIDO is experiencing significant challenges in securing raw materials, particularly those essential for producing cooking oil, which is one of the

company’s core business segments This issue stems from both global and internal factors:

 Global Price Fluctuations in Raw Materials [4]

o Decreased Supply: Major vegetable oil-exporting nations like

Indonesia and Malaysia, which provide key ingredients for KIDO, have imposed export restrictions on palm oil to control domestic pricesand ensure food security This limits the supply of palm oil, a crucial component in KIDO’s cooking oil production

o Climate Crisis and Extreme Weather: Climate change has disrupted

crop cycles for plants like palm, soybeans, and canola, complicating raw material supply and driving up input costs for KIDO

 Rising Fuel Prices and Transportation Costs

o Global Energy Prices: Global energy costs, including oil and gas

prices have risen due to geopolitical tensions in major oil-producing areas, such as the Russia-Ukraine conflict This has increased the cost

of transporting and storing cooking oil, impacting KIDO’s costs

o Increased Shipping Costs: Transporting raw materials from abroad to

Vietnam has become significantly more expensive, pushing up production costs Food companies, including KIDO, face profit marginpressures as raw material costs rise and cannot be immediately passed

on to consumers

 Competition with Other Companies and Limited Supply Markets

o Sourcing Competition: KIDO competes with both domestic and

international companies to secure a stable supply of raw materials Limited global supply, especially for ingredients like palm oil, drives

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