Explore a winning sales approach for hospitality industry in vietnam

EXPLORE A WINNING SALES APPROACH FOR HOSPITALITY INDUSTRY IN VIETNAM MASTER OF BUSINESS ADMINISTRATION In International Business by Mr Dang Minh Tri ID: MBA 01042 International University - Vietnam National University HCMC April 2013 i EXPLORE A WINNING SALES APPROACH FOR HOSPITALITY INDUSTRY IN VIETNAM In Partial Fulfilment of the Requirements of the Degree of MASTER OF BUSINESS ADMINISTRATION Major at International Business by Mr Dang Minh Tri ID: MBA01042 International University - Vietnam National University HCMC April 2013 ii Under the guidance and approval of the committee, and approved by all its members, this thesis has been accepted in partial fulfilment of the requirements for the degree. Approved: ----------------------------------------------Chairperson ----------------------------------------------Committee member -----------------------------------------------Committee member ----------------------------------------- Committee member ----------------------------------------- Committee member ----------------------------------------Committee member iii PLAGIARISM STATEMENTS I would like to declare that, apart from the acknowledged references, this thesis either does not use language, ideas, or other original material from anyone; or has not been previously submitted to any other educational and research programs or institutions. I fully understand that any writings in this thesis contradicted to the above statement will automatically lead to the rejection from the MBA program at the International University – Vietnam National University Hochiminh City. iv COPYRIGHT STATEMENT This copy of the thesis has been supplied on condition that anyone who consults it is understood to recognize that its copyright rests with its author and that no quotation from the thesis and no information derived from it may be published without the author’s prior consent. DANG MINH TRI – MBA 01042- YEAR 2013 v TABLE OF CONTENT List of tables xi List of figures xiii Abstract xiv Chapter One – Introduction 1 1.1. Reasons to choose the topic 1 1.2. Introduction of B2B and Hospitality industry 2 1.2.1. Business-to- Business (B2B) 2 1.2.2. Hospitality projects 2 1.2.3. B2B Hospitality projects in Vietnam 3 1.2.4. Motivations to choose the topic 6 1. 3. Purposes of the research (research significance) 6 1. 4. Research questions 7 1. 5. Scope and Limitations 7 1. 6. Organization of the study 7 1.6.1. Chapter 1: Introduction 7 1.6.2. Chapter 2: Literature Review 7 1.6.3. Chapter 3: Research Methodology 7 vi 1.6.4. Chapter 4: Findings 8 1.6.5. Chapter 5: Conclusion and Recommendation 8 Chapter Two - Literature Review 9 2.1. Classification of B2B Groups 9 2.1.1. Users 9 2.1.2. Original Equipment Manufacturers (OEMs) 15 2.1.3. Middle Man 16 2.2. B2B Buying Situation 16 2.2.1. Straight Re- Buy 16 2.2.2. Modified Re-Buy 17 2.2.3. New Task 17 2.3. “Buying Centre” 18 2.3.1. Initiators 19 2.3.2. End Users 19 2.3.3. Influencers 19 2.3.4. Deciders 20 2.3.5. Approvers 20 2.3.6. Buyers 20 vii 2.3.7. Gate Keepers 2.4. Classification into “Buying Stages” 21 21 2.4.1. Stage 1: Problem Recognition 21 2.4.2. Stage 2: General need description 22 2.4.3. Stage 3: Product specification 22 2.4.4. Search for potential suppliers and evaluate 23 2.4.5. Proposal solicitation and analysis 23 2.4.6. Supplier evaluation and selection 23 2.4.7. Stage 7: Order- routine specification 23 2.4.8. Stage 8: Performance Review 24 2.5. Project Stages 25 2.5.1. Planning 25 2.5.2. Designing 25 2.5.3. Procuring and Constructing 26 2.5.4. Mocking-up room 27 2.6. Marketing Mix 4Ps 28 2.6.1. Products 28 viii 2.6.2. Price 28 2.6.3. Place 29 2.6.4. Promotion 29 2.7. Corruption 29 Chapter 3: Methodology 31 3.1. Research methods 31 3.1.1. Qualitative research 31 3.1.2. Quantitative research 32 3.2. Data collection 37 3.2.1. Select samples 37 3.2.2. Methods to collect data 37 3.3. Format questions 47 3.4. Data analysis 48 3.5. Validity and Reliability 52 Chapter 4: Findings 54 4.1. Findings about critical selling factors 54 4.2. Develop the practical approaching models 59 4.2.1. Findings of relationship between Users and Buying stages 59 ix 4.2.2. Findings of relationship between Users and Marketing mix 69 4.2.3. Findings of relationship between Buying stage and Marketing mix 72 Chapter 5: Conclusion and Recommendation 75 5.1. Conclusion 75 5.2. Recommendation 76 5.3. Limitations 77 5.4. Further research 77 x LIST OF TABLES Table 1: The local and foreign visitors to Vietnam considerably increased since 1990 4 Table 2: Foreign Direct Investment (FDI) into the hospitality industry in Vietnam since 1995 Table 3: Some of construction material required for hospitality projects 4 6 Table 4: Well-known interior designers and architects attended projects in Vietnam 12 Table 5: Global hospitality operators managing the projects in Vietnam 15 Table 6: Users attending in Novotel Saigon 15 Table 7: Qualitative versus Quantitative research 36 Table 8: Users who will attend the interviews 42 Table 9: Suppliers answering about commission 44 Table 10 and 11: Total interviews conducted for the research 45 Table 12: Dimension relationship between Users and Buying stages 50 Table 13: Dimension relationship between Marketing Mix and Users 51 Table 14: The relationship between Buying Stages and Users 52 Table 15: Cold calls are not an effective method 58 xi Table 16: Perspective of approaching Marketing Mix in the dimension between Users and Buying stages 60 Table 17: Considerable changes of ordering sanitary and fittings in the hospitality projects managed by international operators 63 Table 18: Small changes of ordering sanitary and fittings in the hospitality projects managed by local investors 63 Table 19: Specifications are changed much in the international hospitality 66 Table 20: Specifications are majorly kept for final installation 66 Table 21: Perspective of approaching Buying Stages in the relationship between 4Ps and Users 69 Table 22: Perspective of approaching Users in the relationship between 4Ps and Buying Stages 73 xii LIST OF FIGURES Figure 1: Hospitality industry- a branch of real estate 3 Figure 2: Roles of the Buying Centre (Kotler, 2006) 21 Figure 3: Eight buying stages of a project constructing 24 Figure 4: The power role of architects in a hospitality project management 26 Figure 5: Critical factors collected during the interviews 56 Figure 6: Models of international hospitality management 64 Figure 7: Model of local hospitality project management 64 xiii ABSTRACT Almost all of the owners always look for the suitable sales models to enhance their business performance. Beside an experienced sales team, the companies can win their competitors and grow dramatically if they succeed in building methods of customer approaches. The research has helped the companies to find this expectation. The results of this research include 25 depth interviews from suppliers and customers who are hospitality investors, contractors, designers and hotel operators. Their contributions have brought many critical sales factors and help to create 3 models of sales approaches. Salespeople can learn methodologies and techniques to build the practical plans for their companies. In conclusion, the research has supplied the trading companies or suppliers with sales models. They will encourage salespeople to take right actions and win the sales contracts. xiv CHAPTER 1: INTRODUCTION In this chapter of thesis, the author would like to give a brief introduction about the B2B hospitality activities in Vietnam. Some reasons, problems and purposes which have led me to choose this topic will be shared. Finally, a short background of the research introduces about the history of topic development. 1.1. Reasons to choose the topic “How to increase the sales performance” is always one of the tough questions to most of the companies or organizations. Nowadays, so many players have caused an extremely harsh marketplace. Customers always have more than one alternative for their buying decisions. According to Bundschuh and Dezvane (2003), products (understood for the same segments) seem to become similar at functions, designs, quality. Therefore, beside to financing marketing programs, the companies should look for suitable ways to approach potential customers. And depending on types of business, each company applies a different customer approach. Actually, if B2C enterprises attract their customers by financing marketing programs, organizing events and expanding distribution channels; B2B companies of hospitality industry take care of their clients in accordance with the construction stages of projects. Different from B2C which choosing a product may only take some minutes, a buying decision of hospitality investors can be finalized after some months or many years to work with many people and solve many other factors. According to Mr Nguyen Van Hai- sales director of Star Home Appliances Company Limited, approaching the right people and right time 1 can bring his company more than 50% percentage of chance to win the deal. Because the B2B sales can last long time, salespeople need to know the working process. In fact, the overhasty contacts can interrupt the business opportunity. From the requirements of reality, the author would like to build the process of customer approaches in B2B hospitality industry. Salespeople will recognise the persons, the period, etc. to approach the projects. And the final purpose helps organizations to increase the sales performance. 1.2. Introduction of B2B and Hospitality Industry 1.2.1. Business to Business (B2B) According to Kotler (2001), B2B is business activities which acquire goods or services of a company to use or produce other products or services in other organizations. Actually, almost all of the companies are engaged in business markets to gain the benefits together. They have to use the raw materials or completed products of partners to maintain their operations. Formation of B2B is a fewer number of customers but larger volumes per customers and it creates closer and longer- lasting suppliers- customerrelationship. 1.2.2. Hospitality Projects Hospitality is a concept of the real estate industry as a whole. It includes projects in construction for recreation and accommodation such as casinos, entertainment parks, resorts or hotels (Josef Ransley, 2004). The hospitality industry which is a branch of real estate is sketched as the below figure. 2 Office Building Resort Residential Hotel HOSPITALITY Casino REAL ESTATE Parking Entertainment Park Industrial Park Commercial Center Figure 1: Hospitality industry- a branch of real estate 1.2.3. B2B hospitality projects in Vietnam The local hospitality industry has developed strongly since Vietnam government opens the door to the world. Besides, the needs to explore the beauty of country have been increasing strongly, Vietnamese people do not so worry about material demands like eating, clothing, etc. as some tenyears ago any more. They have spent more time and money enjoying the peaceful environment in luxury resorts or entertainment parks. Moreover, 3 Vietnam is a peaceful country. It has attracted millions of foreign visitors annually. These impressive figures encourage the local hospitality to become the key industry. We can make reference to the table of tourism statistics as a confirmation for the promised growth. Foreign Visitors Year Local visitors 1990 250,000 1,000000 1995 1,351,300 6,900,000 2000 2,140,100 11,200,000 2005 3,477,500 16,100,000 2010 5,049,855 27,600,000 2012 6,847,678 32,500,000 Table 1: The local and foreign visitors to Vietnam considerably increased since 1990 Source: the Chamber of Vietnam Tourism In addition, millions of businessmen arrive in Vietnam annually. To meet the considerably increasing supply of accommodation and recreation, billions of U.S dollars have been invested to construct resort complexity annually in Vietnam (source: VCCI, 2012). And totally approximately 300 hospitality projects have been licensed to invest in Vietnam (BCI Asia, March 2013). Foreign Direct Investment (FDI) from 1995 - 2013 Year 1995 2000 2002 2004 2005 2008 2010 24 02 25 15 48 26 145 1.381,2 22,8 174,2 111,17 2.012 9.126 7.328 2013 278 Number of projects 9.545 (est) Capital (millions) Table 2: Foreign Direct Investment (FDI) into the hospitality industry in Vietnam since 1995 Source: the Directorate of Vietnam Tourism 4 To complete hospitality projects, so many products are required to purchase. They need a huge supply of steel, cement and concrete for the body construction. And they also need other hundreds of items for interior equipment. However, only some following items for internal installation are investigated and applied to the thesis. They are sanitary wares & fittings (items for bathroom), lighting system, indoor furniture, fabric of curtain, kitchen appliances, wall paper, carpet, locking system, door hardware, stone and marble, fire and security system. Or they will described in details with the below table. ITEMS BRANDS Water Closet (WC) 1. Sanitary wares and Fittings: shower and basin mixer fittings (bathrooms) Bathtub Outdoor lighting 2. Lighting system Decorative lamp Bed Wardrobe 3. Furniture Outdoor furniture Door/ Window 4. Facility appliances 5. Security Kitchen Security system Fire system Door hardware (locking) 6. Door system Entrance door system 7. Construction material Stone 5 Marble Laticrete Carpet 8. Others Fabric Wall- paper Table 3: Some of construction material required for hospitality projects 1.2.4. Motivations to choose the topic In the competitive market, products have become similar and margin is slim. In this regards, Bundschuh and Dezvane (2003) has mentioned that over the past of few years, the growth of industry has got slow. Meanwhile, competition has become extremely tremendous. We seem not to sell products by their features only because customers have so many alternatives. So we cannot only talk endlessly about our products and hope to get a deal. Today selling is art and requires skills to convince customers. Therefore, targets of this research concentrate to investigate the relationships among the main factors which impacted on the progress of B2B business. The conclusion of the research can supply salespeople and suppliers (trading companies and manufacturers) with scientific business approaches. Salespeople can understand what customers require, what customers prefer to select products for the hospitality projects. 1.3. Purposes of the research (or research significances) Organizations in B2B, sales managers, and sales executives can take the benefits from the research. The study will educate them the right processes and support them to keep the active positions during working with customers. 6 1.4. Research questions Base on the above problem discussion, the purpose of this thesis explains about the importance of features of selling approaches. Further, this purpose will be reached by answering the following research questions. 1) What factors influence on buying decision of customers? 2) How should salespeople approach to win the hospitality projects? 1.5. Scope and Limitation Covering all aspects of the research purpose in the study is impossible due to limited time frame for this thesis. Consequently, this study will be limited to only investigate hospitality projects in Vietnam. 1.6. Organization of the study The study consists of five chapters 1.6.1. Chapter 1: Introduction This chapter gives brief introduction about reasons to choose the topic in hospitality projects and its definition. Besides, some problems need to be discussed to study in the next chapters. 1.6.2. Chapter 2: Literature Review Present relevant theories and points of views of famous scholars in the industry. In addition, some proposed models will be applied to serve the study. 1.6.3. Chapter 3: Research Methodology All of the models, samples or methods to process data will be clarified in this chapter. 7 1.6.4. Chapter 4: Findings After processing data, advice to increase a B2B transaction will be discussed. 1.6.5. Chapter 5: Conclusion and Recommendation Conclude the problem solving and recommend for any further studies. 8 CHAPTER 2: LITERATURE REVIEW This chapter consists of theories regarding the two research questions we have constructed for the thesis where the first and second parts implies theories about B2B approaches which make it important for any manufacturers. We will discuss about essential factors which benefit to improve B2B performance in the last part of hospitality industry. In fact, many authors have announced several factors or models regarding to transactions in B2B business or involving influencers. Kotler is well-known as the father of modern marketing. His works are valuable references for any companies before launching products. We also know about McCarthy (1940) with 4Ps model which is classic work for any advertising and selling programs. In general, we can apply these models, and combine others to propose methods to do business more effectively. 2.1. Classification of B2B groups: As we mention above, B2B companies usually have fewer customers than B2C companies. B2B companies have a customer distribution with a small number of buyers but contribute the vast majority of sales volume. Customers for industrial goods can generally be classified into three groups: users, original-equipment manufacturers (OEM), and middlemen (Kotler, 2001) 2.1.1. Users: regarding to B2B hospitality- project- sales, we do not merely consider “users” as the end- users who will use the products. Actually, end-users never have the power to make decision what to buy. Therefore, in this case we understand “users” as all of the parties/ persons who involve in choosing or buying products. To big projects like 5-star-hotels, many players 9 will attend to finish the projects. They can be designers, project management, ME contractor, bankers, etc. However, four objectives having the biggest power include project investors, designers, project management and contractors (Klinger and Susong, 2006) 1) Hospitality Investors (or developers) Hospitality investors can be an individual or a group who commit capital to invest into projects with expectation of financial return. Investors are categorised into four types: by the natures of their claims (debt or equity), or according to their degree of involvement in operations (passive or active) a) Investment in Equity and Debt The distinctions are made between investment in real assets such as land and buildings and in real estate (hospitality) - related financial assets such as mortgaged-back promissory notes. Both involve exchanges of certain and immediate assets for uncertain expectation of future gain, but expectation yield and risk may differ radically. Consider a development such as an office building or an apartment complex. The individual or organization that buys the real property interest is an equity investor. However, most all of the money comes from a mortgage lender who is called debt investor. Lender often sells their mortgage- secured promissory notes to still other investors who prefer debt to equity positions. Benefits to equity investors are less predictable than those to holders of debt because an equity investor get no cash until the debt holder’s periodic claims to payment on the promissory notes are satisfied. Equity investors also reap the consequences of increase or decrease in the property value. 10 b) Passive and Active Investors Almost all of the investors acquire direct titles to the hospitality projects which they invest. Their key distinguishing characteristics is that they make decision all most of works like selecting sources of management for the projects, discussing the construction contracts, negotiating rental baking rate, etc. All of these works influence on operating results of the company. Therefore, they are behaved as active investors. In contrast, passive investors do not have the decisive voice to the project operating works. They turn their wealth over to professional asset manager who in turn acquire interest in projects of hospitality. Or they can acquire shares in corporations, partnerships that hold extensive holding property interest. In general, passive ones often take smaller shares and have little direct impact on operation. 2) Designers and architects Designers are the persons or the firms who help investors to design the rising buildings or hospitality projects. They keep the roles to consult investors and hospitality management how the projects should perform in the most effective operation when the projects come to use. For example, a resort which is nearby the beach is designed differently from a hotel in the city. Famous designers and architects have thorough knowledge of the local culture, history of the area where the projects locate. Although designers are not the person who will manage the projects or purchase the items for final installation, they have a great power to specialize 11 the brands. Actually, the brands which are chosen from designers will have a big opportunity to be awarded. To a hospitality project, many kinds of designers are invited to serve for. If they take responsibility to design water pipeline, electricity system or restaurant operation, they are known as an M&E designer. Meanwhile, a firm which is professional at outside decoration, they can be a landscape company or architecture. Another important player is interior designer. They will take care of all decoration inside projects. In reality, each company has its own strong characteristic and is specialized. Some well-known architects and designers for hospitality projects which have been completed in Vietnam can be listed below. NAME PROJECTS HEADQUARTER TYPE Hirsh & Bedner Caravelle Saigon Sinapore Designer Bensley Intercontinental Thailand Architect and Danang Ho Thieu Tri & Saigon Centre Designer France & Vietnam Architect Associates Aurecon Pullman Saigon France M&E Greg Norman Montgorilinks USA Golf design Malaysia Lanscape Danang Pentago Four Season Table 4: Well-known interior designers and architects attended projects in Vietnam 12 3) Contractors After completing the overall designs, contractors are awarded to construct the project. They take responsibility to follow the specification and secure the quality of construction with the available financial budget. Many types of contractors are attended but they can be classified into main contractor and sub-contractors. a) Main contractor The main contractor is someone who takes charge of and manages all stages or parts of the project. He must always update on-site operation to investors and designers. This firm has to have management experiences and prestigious brand and good financial capacity b) Sub- contractor Modern industrial activity is based on specialization and the combining of many specialist skills to form an integrated body. The main contractor cannot have specialists for all of the stages of a project. Therefore, to finish the works, the main contractor must rent other smaller contractors which we call sub-contractors. Normally, the contract between employers and the main contractors does not create any contractual obligations about renting the sub-contractors. 4) Hospitality Operator A hospitality project will be divided into two types regarding to management: investors can manage their projects by themselves, or they can invite an international hospitality operator to manage their project. Hospitality operators are presented in all levels from 1 star to 5 stars. 13 However, they are often invited to manage the big projects from four to five stars in Vietnam. To international hospitality, investors will invite a facility operator to manage their projects after the projects are completed. The reason is that investors only have capital but without management experiences and knowledge. In addition, international operators have sources of customers and representative offices over the world. Operators will welcome international travellers to stay in the local hotels which they are managing in a country. Therefore, the sales revenue is secured. The contract between hospitality operator and investor(s) is considered with the long term which can be at least 10 years or more. The hospitality operator is invited even when the planning stage (mentioned in 2.4.1) is drafted by developers. As an important consultant, he can advise investor what kinds of materials, brands, etc. should be equipped in the projects to secure the right level of building. Therefore, this party is one of the key players whom suppliers have to approach. Some international hospitality operators can be listed in Vietnam. Hospitality Operators Marriott Name of Hospitality in Vietnam Investor Ranks JW Marriott Hanoi Bitexco Vietnam 5+ star hotel Le Meridien Saigon Tien Phuoc JSC 5 star hotel Sheraton Saigon Dai Duong JSC 5 star hotel IHG Intercontinental Da Nang Sun Group 5 star resort Ascot Somerset Saigon N/A Service condo Accor Sofitel Saigon N/A 5 star Starwood 14 Novotel Saigon Saigon Liberty 4 star Ibis South Saigon Dai Minh (Korea) 3 star Table 5: Global hospitality operators managing projects in Vietnam In brief, an example of each consulting role is showed through Pullman Saigon Hotel Centre. This hospitality project is contracting in 148 Tran Hung Dao, Nguyen Cu Trinh Ward, Dist. 1, Ho Chi Minh City. Investors/ Developers Other Users Roles Accor Asia Hospitality Operator SWA Vietnam Architect Kume Design Interior Design Coteccons JSC Main Contractor Aurecon ME Design Aurecon ME Contractor TTT Architect Sub- Contractor REE Corp. Sub- ME Contractor Que Huong Liberty JSC Saigon Tourists Invesco Corporation Table 6: Users attending in Novotel Saigon Source: BCI Vietnam https://services.bciasia.com/view/project.cfm?CFID=137719&CFTOKE N=74688674&focus=1&project_refid=102421610956569 2.1.2. Original Equipment Manufacturers (OEMs): almost all of the manufacturers cannot produce all spare- parts to complete a product. Therefore, they have to incorporate the purchased goods into their final products. For example, to produce sanitary bathtubs for hospitality projects, Kaldewei AG (Germany) cannot produce all fittings/ spare parts. The 15 Company has to rent Viega AG as an outsourcer to complete the products. This process is also called B2B in the kind of OEMs. 2.1.3. Middlemen: B2B does not mean all purchasing activities only happen between manufacturers and corporates. The last groups of industrial buyers are essentially composed of distributors and wholesalers who distribute industrial goods from the manufacturers to users, to OEM’s, and to other middlemen. Of three classified groups, the Users are concentrated to analyse. In the B2B sales to hospitality projects, OEMs and Middleman are not the targeted objectives for a sales process. OME is only a stage of whole chain to complete the products. Therefore, it is not considered as sales activities for this research. Meanwhile, Middleman is a progress of distribution system. Manufacturers often look for locally potential agents to expand the market in a country. It is not involved in searching for customer approaches. Because the target of the research is to find suitable ways to approach customers, we will focus on Users to study investors, contractors, designers and operators. 2.2. B2B Buying Situation An institutional buyer has to face many decisions before finalizing to make a purchase. The amount and complexity of these decisions depend on the respective buying situation. For almost four decades, marketing literature has persistently broken them down into three types of recurring buying situations: the straight re-buy, modified re-buy, and new task (Kotler, 2006) 2.2.1. Straight re-buy is the most common buying situation and usually involves the least risk. The purchasing department does not have enough time and labour to compare the terms of all relevant suppliers when 16 considering to buy new items. Most of the companies have buying budget which specify adequate preferred brands and item ranks before doing a project. 2.2.2. Modified re-buy is a situation in which a company would like to satisfy an existing need by modifying innovated products or spare-parts. Motivations for the re-evaluation of alternatives can not only simply reduce costs or to improve performance but also compulsorily change due to new regulations fall in this category. For instance, management board of Epic Designer- a textile manufacturer in Bien Hoa City- expects to improve labour efficiency, they can replace the lighting systems which brings the workers a comfortable sense of eyes to increase the out-puts. In this case, the management board has made a B2B deal with lighting producer to improve the performance. 2.2.3. New task is a purchasing situation for a new project. Different from straight re-buy and modified re-buy which just renovate the available systems, new- task makes a company confronted with a new requirement for products or services. When we buy something for the first time, we will have a lack of experience to negotiate the deal and choose the items. Therefore, this task might increase the level of uncertainty and risk which involve in a buying situation. In this case, the more people are involved in the buying decision. They can be project executives, project managers or directors. All of them gather the product information, check and evaluate which the best solution for project. The process can usually take longer time than two kinds above. 17 In general, the model of B2B Buying Situation gives us details about each type of purchase. The author of the model comments about advantages and/ or disadvantages of each type and mentions some departments which the seller can work with. However, the methods which we need to approach potential customers have not been realized. 2.3. “Buying Centre” As we just mention above, the buying process B2B often takes time and look complicated to be closed. In fact, several participants of many departments such as finance, engineering, architect, etc. can involve in buying decision. Kotler has called this formation as Buying Center (Kotler, 2001). The concept of buying centre provides rich insights into the role of the group forces in the organizational buying behaviours (Johnson and Lewin, 1996). The buying centre consists of individuals who participate in the purchasing decision and share the goals and risks which arise from the decision. The size of buying centre varies, but the average includes more than four persons per purchase; the number of people involved in all stages of one purchase may be as many as (Mc William, 1992). A buying group evolves during the purchasing process in response to the information requirements of the specific situation. Because organizational buying centre is the process rather than an isolated act, different individuals play a different role in the process at the different times (Ghingold and Wilson, 1984). A design engineer may exert significant influence early in the process when products specifications are established. Other may assume more dominant roles in later phases. A salesperson should define the buying situation and the information requirements from the organization’s 18 perspective in order to anticipate the size and compositions of the buying centre. The composition cannot be the same for all organizations. In alignment with the role each individual of the buying centre can play, marketing literature generally distinguishes between initiators, users, influencers, deciders, approvers, buyers, and gatekeepers. 2.3.1. Initiators can generally be anyone in the organization. They detect a product or service necessary for the company so they send a request for purchase. They may be front line employees or high level managers as long as the request is right and support for their works. The request can be a small or big order. 2.3.2. End-users: these people have to use the products or services in the end. The end-user, in this case, can be staff in the company. The influence of the user on the buying decision depends on the sector of activity and the corporate culture. Usually, the higher qualified the users, the more weight is given to their opinion. However, the end-user can be customers. For example, we buy an apartment of Saigon Pearl. The developer has installed all interior equipment such as kitchen, sanitary ware & fittings, flooring wood, tile, etc. and we often accept them as available arrangement. In this case, users may have little power to make decision which goods are bought. 2.3.3. Influencers are people who have the power to guide the buying decision by defining specifications or providing further information for the evaluation of alternatives. In the hospitality development, especially in high-end projects, architects (or/ and designers) and hotel (or condominium) management can specify on behalf of the owner. They are paid for labour 19 and creativity. Therefore, their ideas are extremely respected. We can see a case for this situation. The developer Sun Group has invested many millions of USD to form a five-star resort and condominium complex project in Da Nang, centre area of Vietnam. Sun Group has invited Bensley Thailand as architects & interior partner and IHG as project operator. All equipment finalized by B2B contracts has not been changed much after Bensley’s specification and IHG’s approval. Now the project name Intercontinental Danang Resort and Spa has been becoming one of the most charming resorts of the world. Hence, we can see the important role of influencer who guide the item decision and define specification in B2B activities. 2.3.4. Deciders: as we mention in the part 2.3.3), the roles of consultancy Bensley and IHG are extremely powerful to develop the project Intercontinental Resort & Spa. However, the final decision of the purchase is made by decider. The decider always hold the managerial levels and can be General Director, Chairman or someone who pay money actually (sometimes the capital owner does not hold any positions in the organization). If the deciders consistently disapprove the items, Bensley surely has to choose an alternative. 2.3.5. Approvers: Bensley or owner can propose the items. However, they are required to have approval from project-site managers due to any problems of ME or engineering, etc. From the reality, these issues happen quite often but they can be solved. 2.3.6. Buyers: the persons are authorized to arrange the purchase terms, negotiate with suppliers about the trading terms so that B2B contracts can be completed. 20 2.3.7. Gatekeepers are the persons who control the information flow to the members of the Buying Centre. In this research, I also interview suppliers about the sales- cold- calls to gatekeepers who can be purchasing agents, receptionists and telephone operators. Can we meet the decision makers if we call to gatekeeper? How many percentages can lead to the successful B2B deal if we call directly to receptionists? We will have an answer in the thesis and give advice then. Decider Approver Influence BUYING CENTER User Buyer Initiator Gatekee Figure 2: Roles of the Buying Centre (Kotler, 2006) 2.4. Classification into Buying Stages Different from Kotler (2006) who has established Buying Centre, Robinson, Faris and Wind (2009) have divided a hospitality project into eight buying stages in accordance with project construction progress. Salespeople can approach customers though the model of eight stages. 2.4.1. Stage 1: Problem recognition The first stage of the organizational buying process begins with the anticipation and recognition of a certain need. Investors have financial ability 21 and need to invest for interest. However, in this stage investors have not figured out what kinds of projects they will spend money. They can consider constructing an office building, a hotel or a commercial centre, etc. Normally, this stage happens from 1-2 years before the project makes ground-breaking (sources: BCI Vietnam- part: leading stages). 2.4.2. Stage 2: General need description The needs (or stage 1) are confirmed. Investors have made decision to build a hotel, not an office building or commercial centre after assessing their experiences and investing opportunities. However, to secure not to spend over the amount investors can afford, their procurement enumerates all products which are required for the project construction. A department of cost survey will support to look for the price of those items. And so, investors can estimate the capital budget quite exactly before continuing their projects. This stage always happens prior to breaking- ground. 2.4.3. Stage 3: Product specification Investors have invited designers, contractors and operators (Users) to carry out the projects in this stage. Investors and/ or designers are considering choose brands, products for their projects. By the available budget, designers will specify the products in their documents. In this stage, all of the products will be listed clearly with product code, brand name, origin, etc. This stage is extremely important to suppliers because if their products are specified, they can have a big chance to win the contract. Other suppliers who would like to tender quotation have to follow the specification. However, the patent can cause each brand to have different designs, features, and functions. Therefore, they have to spend more effort to approach customers. 22 2.4.4. Stage 4: Search for potential suppliers and evaluate: The buyer uses various media or available sources to search for all potential suppliers and then evaluate whether they meet the requirements with expressed standards. Suppliers can be the organizations who distribute the products in a country or area. A brand can be distributed by an exclusive agent or many suppliers. For example, Yale is a famous door- hardware brand. This company has 3 suppliers in Ho Chi Minh City. And all of them have tendered Yale in Hotel A. Then, the investor can evaluate them basing on financial capacity, project references (all projects each supplier supplied should be showed), stock and relationship to make decision who is awarded. 2.4.5. Stage 5: Proposal solicitation and analysis Besides obtaining proposals from qualified potential suppliers, defining some important criteria for the latter evaluation and selection is mentioned. In this step, investors or consultants will evaluate all suppliers. Only suppliers who meet the requirements about capital, project references, capacity, etc. will be selected for tendering. 2.4.6. Stage 6: Supplier evaluation and selection The buying organization will consider which company will be awarded after the tenders. They will compare many different criteria established in the previous stages. 2.4.7. Stage 7: Order-routine specification Investors have chosen the brands for their hospitality projects. Depending on how the production of a company is organized, the selection of an order- routine can be considered. 23 2.4.8. Stage 8: Performance review Consequently, the organizational buying process is finished after the products or services have been received and checked by the company. Stage 8 Performance review Stage 7 Order-routine specification Stage 6 Supplier evaluation and selection Stage 5 Proposal solicitation and analysis Stage 4 Search for potential suppliers and evaluate Stage 3 Product specification Stage 2 General need description Stage 1 Problem description Figure 3: Eight buying stages of a project constructing This model brings salespeople a progress of buying actions in details. Dividing the construction project into eight buying stages helps salespeople have enough time to prepare works for each step. Normally, constructing a project takes 24- 30 months to be completed. It means that salespeople have 3-4 months to approach customers for each stage. In addition, the model describes clearly about what customers will behave during each period. Salespeople can realize the content and prepare work to suit the requirements of customers. 24 2.5. Project Stage (Klinger and Susong, 2006) If Kotler (2006) introduces the model with eight buying steps, Klinger and Susong (2006) generalize a project into 4 important stages so that salespeople can approach. 2.5.1. Planning Once the owner has determined to process a new project, he must define the requirement and delineate the budgetary constrain. Project definition involves establishing the broad project characteristics such as location, project criteria, kinds of new facility, services, etc. Although investors can invite other technical consultants to help them, the definition of works is basically responsibility of the owner. In general, this stage is early and owner is drafting what he should do. We also call this phase by Planning and Budgeting stage. 2.5.2. Designing The designing phase involves architectural, interior and engineering effort for the entire project. This stage culminates in the preparation of final working drawings and specification for the total construction program. However, in reality design, procurement and construction often overlap, with procurement and construction beginning on a certain segment as soon as the design is completed and drawings and specification become available. The right selection of a designer is one of the major factors in project success. The designer creates the design after experiencing environmental restrictions, owners’ budget, and other requirements. Because of the increasing complexity of modern projects, a multi-discipline approach to design is required. Therefore, many specialized designers or sub-consultants 25 will also be required to complete the design. The below illustrated chart can help to understand the roles. Figure 4: The power role of architects in a hospitality project management 2.5.3. Procuring and Constructing This stage comes to complete the project. Developer and designers can revise the specified items as long as they meet the budgetary constrain and fit the technical installation. Procurement refers to the ordering, expediting, and delivering the key project equipment and material, especially to items which require long time to be produced or imported. Construction means the process of physically erecting the project and putting the equipment into places. This stage involves providing the manpower, construction equipment, supervision, management, etc. what are necessary to accomplish the work. 26 2.5.4. Mocking- up rooms Mock-up room is the true size sample to demonstrate how the room looks like after products are installed. This stage is the final opportunity for all involved parties to check technical factors or revise the product features which are not suitable. In reality, when the contractors install items from specification of designers, it does not work. Therefore, this effort is extremely important before processing for the whole project to escape the wrong causes. The mock-up stage can carry out either before the portion of “constructing” or after this phase. With my experiences and observations, the model with 4 main stages is actually great. Especially, the author has mentioned the stage “mock-up room” which is extremely important for each supplier. Normally, a product which is chosen for the mock-up room occupies the first priority when customers make decision to purchase. Therefore, all salespeople have to try their best to install their products in the mock-up rooms. However, the model of Klinger and Susong (2006) does not follow time order of project progress which makes inexperienced salespeople difficult to monitor the project. In fact, the mock-up rooms can be finished before construction stage. Therefore, a sales person always keeps this advice, s/he can face the failure. In addition, the author does not point out what salespeople should follow up after the mock-up rooms are done. Winning the mock-up room is crucial but competitors still hijack the projects. If salespeople do not have any continuous approaches, it can destroy their effort which spent from the beginning. 27 2.6. Marketing Mix 4Ps Marketing mix originates from the single P of product, price, place and promotion. McCarthy (1964) offered the “marketing mix”, often referred to as the “4Ps”, as a means of translating marketing planning into practice. The tools can be used to develop both long-term strategies and short-term tactical programmes (Palmer, 2004). The main reasons the marketing mix is a powerful concept because the model makes business strategies become easier to handle. The marketing mix concept also has two important benefits. First, this tool enables sales &marketing manager to see the job clearly. He can easily recognise what points are required to concentrate on. Second, all managers have to allocate available resources among various demands. And the marketing manager will in turn allocate these available resources among the various competitive devices of the marketing mix. 2.6.1. Product The product includes not only the physical functions but also its package, warranty, after sales services, brand name, company images, value and many other factors. Products can be tangible goods such as computers, ideas offered by consultant, or services such as medical cares. Products should supply customer value. 2.6.2. Price The price is what a buyer must give up to obtain a product. Price consists of credit terms, payment or discount. 28 2.6.3. Place (Distribution) Distribution is the channel by which a product flows from a producer to the buyers. One aspect of distribution strategy delivery is deciding how many distributors, dealers or agents should be established in a geographic area. The system should meet the lead-time requirement of purchasers. Distribution is important factor for a product accessible to the target market. 2.6.4. Promotion Promotion includes advertising, public relations, sales promotion, direct emails, posters, catalogues, etc. to inform or remind the target market about the product’s availability and benefits. Promotion’s goal in the marketing mix is to bring about mutually satisfying exchange with the target markets by informing, educating, persuading, and reminding customers of the benefits of a product. A good promotion strategy can dramatically increase sales. However, to secure a B2B transaction, project sales is not simple that proposals of competitive price, good model design, better services, etc. can bring to a successful deal. Actually, Rotberg (2009) claims that corruption is one of the key influencers in some countries so that business becomes easier and awarded. Therefore, researcher would like to survey how important corruption influences on decision making of buyers. Who are the people who would like to take? This part is difficult to be researched. Therefore, the answers of the corruption will be shared by product suppliers. 2.7. Corruption- Commission Corruption occurs when one person seeks personal gain by taking unfair and hidden advantage of someone else position, status or condition. It happens when the truth of a product, service or activity is changed. 29 In the annual report Corruption Perceptions Index, Transparency International has ranked Vietnam at 123th as the worst corruption worldwide. In fact, corruption is one of the most popular topics mentioned in Vietnamese daily lives. If a document is expected to approve quickly in the authority offices, cash should be paid first. The corruption seems to become so popular that people consider it as lubricant for the automobile. However, the writer does not claim corruption as bad codes or cheated action in this research. The final purpose of this factor makes us know how important corruption play roles to win a project. 30 CHAPTER 3: METHODOLOGY In this chapter, the methodology used to conduct the research will be presented. Firstly, the author discusses reasons why qualitative method and other related technical issues will be applied for this study. Secondly, discussion on techniques which are used for data collection and sample selection will be given. Finally, the author will propose the approaches to process data. 3.1. Research Methods The most important question of a research is to choose a suitable methodology quantitative or qualitative. Therefore, an analysis about these approaches will be described to make a choice then. 3.1.1. Qualitative research Qualitative research describes an event or phenomenon in its natural setting (Zikmund, 2001). This method gives a subjective way to look at life as it is lived and an attempt to explain the studied behaviours (Flick, 2002). Rather than design an experiment and artificially control the variables, qualitative researchers use anthropological and ethnographic methods to study the participants. As little intrusion as possible should occur in qualitative research and a researcher will frequently observe the participants unnoticed (Creswell, 2003). Qualitative research seeks to explain a current situation and only describes that situation for that group. Since only a current situation is observed, all qualitative research is done in the field. A possible exception is the focus group, which is conducted with 3-10 persons and uses a script of questions. 31 The moderator asks the questions and the recorder records the responses if possible. Although a focus group is conducted in a controlled environment, the open ended questions and lack of rigid sample selection make it seem more like a field exercise (Zikmund, 2001) 3.1.2. Quantitative research Quantitative Research establishes statistically significant conclusions about a population by studying a representative sample of the population (Creswell, 2003). The population consists of the entire group being studied. It does not matter if the population is broad or narrow. Only that it includes every individual that fits the description of the group being studied. Since it is impractical to conduct a census (include every one of the population) because of constant turnover and resource constraints, a representative sample is chosen from the population. If chosen properly, the sample will be statistically identical to the population and conclusions for the sample can be inferred to the population (Zikmund, 2001). Quantitative research usually is one of two types: experimental or descriptive. Experimental research tests the accuracy of a theory by determining if the independent variable(s) (controlled by the researcher) causes an effect on the dependent variable (the variable being measured for change) (Campell and Stanley, 1963). Often, surveys, correlation studies, and measures of experimental outcomes are evaluated to establish causality within a credible confidence range. 32 Descriptive research measures the sample at a moment in time and simply describes the sample’s demography. Although this is not seen as a statistically robust or difficult exercise, a good description of the variables helps the researcher evaluate the statistical output in the proper context (Creswell, 2003) Some researchers think that quantitative research is better than qualitative research at establishing causality because of the precise measurements and controlled environment of experiments; however qualitative studies can also be used to establish causality but with less external validity. Laboratory experiments are used when all extraneous variables need to be controlled so that the specific action and effect of the independent variable can be controlled. In addition, it may be important to be able to replicate the study and a laboratory setting makes these things possible. Field experiments are conducted when it is important to measure what the research element actually does, rather than what they say they will do. As can be seen with concept studies, what a person says they will do and what they actually do can be very different (Zikmund, 2001). In conclusion, basing on the characteristics of two types of researches; whereas quantitative research seeks to validate a theory by conducting an experiment and analysing the results numerically, qualitative research seeks to arrive at a theory that explains the behaviour observed. In this way, it can be said that quantitative research is more deductive and qualitative research is more inductive (Trochim, 2000) 33 To compare the characteristics of two types of research, a summarised table is established to compare before making decision what type of the research will be applied. Criteria Qualitative Research Quantitative Research To understand and interpret To test hypotheses, look at Purpose cause & effect and make social interactions predictions. Smaller and not randomly Larger and randomly Group Studied selected Study selected of the whole, not Specific variables studied Variables variables Type of Data Words, images or objects Numbers and statistics Collected Qualitative data such as Quantitative data based on opened such as open-ended precise measurement Form of Data responds, interviews, using structured and Collected participant observations, field validated data collection notes, and reflections Type of Data Identify Analysis themes relationship Subjective is expected Objective is critical Objective and patterns, instrument. features, Identify statistical 34 Subjective Researcher and their biases Researcher and their may be known to participants biases are not known to in the study and participant participants in the study. Role of Researcher characteristics may be known And participant characteristics to the researcher. are deliberately hidden from the researcher (double blind studies) Particular Results or specialized Generalizable findings can findings is less generalizable be applied to other populations Exploratory or bottom-up: the Confirmatory or top- down: Scientific researcher generates a new the researcher tests the Methods hypothesis and theory from the hypothesis and theory with data collected. Most Common Explore, Research construct the data. discover and Describe, explain and predict Objectives Wide- angle lens, examines Narrow- angle lens, test a Focus the breadth and depth of specific hypotheses phenomena. 35 Study behaviour in a nature Study behaviour under Nature of controlled environment conditions, Observation isolate casual effects Narrative report with contextual Statistical description and report with direct correlation, comparison of Final Report quotation participants from research means and statistical significance of findings Table 7: Qualitative versus Quantitative research (Johnson & Christensen, (2008) and Lichtman, (2006)) The purpose of this topic finds the suitable approaches to enhance the sales ability. The findings are processed through observations, experiences, description, and depth- interviews. In addition, the topic would like to discover new things which nobody has mentioned their researches in Vietnam so far in this B2B hospitality. In addition, the sample or population of the research is small and selective. There are not so many investors, designers or operators who are working in the high-end hospitality industry in Vietnam. In reality, only 15 individuals of Users (Kotler, 2006) attend the interviews. Therefore, only qualitative method enables to explore the new information and find the new factors. Meanwhile, quantitative method is used to confirm the facts. In conclusion, the thesis will apply the qualitative research to construct the approach models. 36 3.2. Data Collection 3.2.1. Select samples According to Solvang (1997), selecting respondents is also crucial. If we receive wrong respondents due to meeting wrong persons, the research may turn out to be invalid or insignificant. To fulfil the targeted purposes, it was extremely important that we should meet the individuals who have thorough knowledge, experiences and power and have to communicate with corporate identities. The reasons to choose individuals for the interviews will be presented in the part 3.2.2.1. a) 3.2.2. Methods to collect data According to Davidson and Patel (2003), methods to collect data of qualitative research include preparation of questionnaire formats, conducting personal interviews, exploring new things by observation, etc. The questionnaires are often less structured in a questionnaire and get the respondents without any explanation. Also from Davidson (2003), we can use telephone or emails to collect information. However, distance interviews can cause misunderstandings or unfriendliness. As a result, we can receive not correct data as we expect. In addition, the duration of a distance interview is often limited from 2 to 5 minutes. Therefore, the personally face-to-face interviews are more preferable. Yin (1994) considers depth- interviews as the most necessary sources to conduct a qualitative research. He shares that aspects of an issue can be 37 clarified by the interview. It concentrates directly on the case study topic. Encumber (2000) considers interview as a conducted tool to recognise deep and detailed data from a few respondents. Regarding to observation, the researcher can only observe on-going processes, situation and behaviours. The positive aspect of observations is that they do not depend on the respondent’s willingness to reveal more personal information. In this thesis, observation can be translated by the researcher’s own experiences. In general, the advice from Erikson, Paul, Davidson, Patel, Yin and Encumber above has led the writer to collect data by following techniques 3.2.2.1. In depth interviews (open interview) In- depth interview organised with fifteen (15) customers who occupy the important positions of the real- estate organizations or consultant firms. Basing on the theories of chapter 2, their sharing supports the researcher to realize which factors enhance the selling ability. The writer summarizes information of depth interview and combines models of scholars to get the conclusion about selling approaches. The list of 15 customers is mentioned as below. However, to secure the privacy of interviewees; their true names are changed by other callings. Meanwhile, the project names are called A, B, C, etc. with the general addresses. 1) Interview is made with one of the key person of investors. This person keeps the power to choose the products. Another interview is also 38 made with a designer of designing firm for the project. She has taken major charges of interior design. They are working for Hotel A- an international five- star hotel locates in Ton Duc Thang Street, Dist. 1, Ho Chi Minh City, Vietnam. 2) Information is shared by two individuals from developer and hotel operator. They are keeping the mid- level managers of their organizations. They are working for Hotel B- an international four-star hotel locates in district 1, Ho Chi Minh City, Vietnam 3) Discussion is made with project manager of renovation section. In addition, the key person of sub-contractor is also on the table. These people are devoting to Hotel C- an international five-star hotel locates in the centre of district 1, Ho Chi Minh City, Vietnam 4) Data collecting is shared by a project manager from hospitality investor and a senior design firm from a overseas corporation. Two these persons are working for Resort D- an international five-star resort in the centre area of Vietnam. 5) The interview is made with sub-contractor of the project. She is working as project manager for Hotel E- an international five star hotel in Hanoi, Vietnam 6) The next interview is made with decision maker who is the active investor. He is investing to build Resort F-a local four- star resort in Kien Giang Province, Vietnam. 39 7) The 7th project which the writer contacts for the interview locates in Hanoi, Vietnam. Two persons have attended for the interviews and give many factors which are necessary for project approaches. It is called Project G- a locally high-end service apartment. And interviews are made with decision maker and senior designer 8) Another individual which chosen for the interview keeps the important level in the organization. His company has invested into the Project H- a local three- star resort in Phu Quoc Island, Vietnam. 9) The next person attending the interview comes from Binh Duong Province. He is the decision maker to choose the products/ construction materials for his project. Therefore, he can help to feedback the true information basing on the reality expenditure. His project is called Hotel K- a local four- star hotel locates in Binh Duong Province. 10) The last interview is made with a young man who is working for Resort L- a local four-star resort locates in Vung Tau City, Vietnam. He is project manager. This project is developed by stated company. In brief, this table is summarized project names and the position levels of interviewees in the organizations. 40 Projects Hotel A International hotel-5 stars Hotel B International hotel-4 stars Hotel C International hotel-5 stars Resort D International resort- 5 stars Location Dist. 1, HCMC Dist. 1, HCMC Dist. 1, HCMC Centre International hotel-5 stars Resort F Local resort- 4stars Project G High-end service condo. Hotel H Local resort- 3 stars Positions Investors Directing level Designer Senior Designer Investors Project manager Operator Manager Investor Project Manager Sub-contractor Directing level Designer Senior Investor Project manager Sub- contractor Directing level Investor Directing level Investor Directing level Designer Senior Investor Directing level Area, Vietnam Hotel E Users Hanoi, Vietnam Kien Giang, Vietnam Hanoi, Vietnam Kien Giang, Vietnam 41 Binh Duong, Resort K Local hotel- 4 stars Vietnam Investor Directing level Operator Manager Vung Tau, Resort L Local resort- 4 stars Vietnam Table 8: Users who will attend the interviews However, the purposes of the research can hardly reach the target if other sensitive factors cannot be found during a B2B project approaching. In fact, practical factor like commission seems not to be found during the interviews with investors or operators…. Many people have said that paying commission is necessary to win the contract. Therefore, the research would like to confirm how important this factor plays role in the B2B hospitality sales. As mentioned, this factor is sensitive and should not ask directly Users (Kotler, 2006). Hence, it will be contributed by suppliers in the same industry. The survey will continue to interview nine (09) suppliers who have been distributing the same product ranges for hospitality projects. Similarly, to secure the privacy of these suppliers, their true names are changed. 1) Nguyen Van Hai (General Director) The company of Mr Hai supplied home appliances & kitchen many big hospitality project in Vietnam. He will help to answer about the commission/ corruption to buyers in projects which he attended. 42 2) William Tay- Singapore (Sales manager) He will share about his experiences of how to sell B2B successful and the importance of commission when he worked in Vietnam. 3) Nguyen Minh Cuong (Sales Manager) Mr Cuong has attending all high-end hospitality projects throughout Vietnam. He will share about the corruption to the projects, the percentage rate which often pays to get the contract. 4) Dang Thuy Nga (General Director) She is selling concrete. This product will work directly with developer and sub- contractor. She will support to answer how much percentage she must pay commission for projects in Hanoi. 5) Nguyen Xuan Linh (Sales Manager) Ms Linh will share about the commission and experiences she often approaches her customers. 6) Pham Trong Nam (Sales Manager) Mr Nam will share about his experiences to win the projects. 7) Bich Van and Ngoc Bich- (receptionist and designing librarian) Similarly, the second table is summarized for suppliers to ask about paying commission. 43 Name Items supplied Position Nguyen Van Hai Kitchen, home appliances Director William Tay Sanitary & fittings Sales Manager Nguyen Minh Cuong Sanitary & Fittings, marble Sales Manager Dang Thuy Nga Concrete Sales Manager Nguyen Xuan Linh Laminet Sales Manager Pham Trong Nam Sanitary, door hardware Sales Manager Bich Van Architect Receptionist/ Librarian Dang Thi Ngoc Bich Architect Receptionist/ Librarian Table 9: Suppliers answering about commission Totally, the research has 15 interviews with Users is carried out. They are holding the key roles in their organizations. USERS INTERVIEWS POSITIONS 5 Directors Investors 8 3 Managers Designers 3 Senior Contractors 2 Directors Operators 2 Manager 44 In addition, suppliers are invited to discuss about the commission or the successful rate of cold calls. 7 Sales manager Suppliers and others 9 2 receptionists Table 10 and 11: Total interviews conducted for the research a) The reasons to choose these individuals Three reasons lead the author to choose the individuals mentioned for the interviews. Firstly, almost all of the interviewees are keeping the key positions in their organizations. They have power to choose or specify the products. By their experiences and power, they will answer exactly what/ when they prefer to meet a supplier. Secondly, all of the hospitality projects of these interviewees are on construction. In this case, customers will remember what they are doing for their projects. They can answer the questions immediately and quite accurately. What they need from suppliers are on their mind and willing to share. Suppose that the research conducts information with the projects completed 5 or 10 years ago, interviewees will not have enough time or data to talk about because they have to operate their business rather than take care of buying stages or progress of their projects. Last but not least, they should be the young generation. I have thought that if one individual has the ages are quite the same as the interviewer. He 45 will share much more than. Therefore, I have selected most of the interviewees who have the ages from 35 to 40. b) Environment to collect data Creating a friendly atmosphere where the interviewees feel comfortable enough to share information is important. Besides, the interviews are required of digging different perspectives. So sensitively, there are other people sitting next to the interviewees. They can get stressed if the meetings happen in the narrow environment. Therefore, café is an ideal place for the meetings. Second reason makes me to choose the cafés because my customers will concentrate on exchanging information more than in their offices. They will not answer the many phone calls, sign the documents, or answer emails, etc. Moreover, my customers can spend 30-45 minutes for a meeting in the coffee shops, longer if I meet them in their offices. With the data I would like to collect, 30 minutes is ideal time- budget. 3.2.2.2. Exploratory research Exploratory research is often used when the problem has not been known about or the available knowledge has not been updated completely (Teblius, 1987). This technique assists the market researcher in finding possible causes to the symptomatic problems (declining sales, disagree a contract, etc.) which communicated by conversations between a researcher and interviewer. Generally, exploratory is more suitable to a qualitative research which fits original target of this thesis. 46 3.3. Format questions An interview often takes 30 minutes. The researcher only concentrates to ask questions which are necessary for the research target. The collection of answers also depends on the interviewees’ mood and what customers prefer to share. In reality, customers are willing to share much about problems or issues which they are facing more than to answer what they have experienced. However, to reach the expected target, some topics to prepare questions are listed to make the interview become more central. 1) What factors leads customers to prefer to work with a supplier rather others? (Customers can answer about Soft skills and Methods of approaches of suppliers) 2) Introduce models of 8 stages of Buying Stages or 4 Stages of Construction to customers. Discuss them which steps are more important? (Or which stages they will take cares much of 8 Buying Stages). 3) If a supplier call customers to introduce products, but they are not considering this product in this stage. What do they often behave in this case? Do they introduce their staff to suppliers? Or do they refuse the meetings? Target: the above questions help to answer if suppliers need to approach customers at right period, or right persons? And the roles of cold calls 47 4) Explore the decisive roles of customers. How important each investor or designer in the hospitality management. And what are their roles in each Buying Stages or Stages of Construction. 5) The topic: corruption (if possible to ask) 6) Do you take opinions of underline levels before making any decision to buy a product? 7) How many brand of sanitary ware products on your table? To compare them, what lead them choose this brand rather than others. 8) All of the advice which interviewees can share with suppliers to win the contracts. The researcher has to find to explore FACTORS and their relationship. 3.4. Data analysis Data analysis is examined, categorized, tabulated or recombined the collected data (Yin, 2003). Every investigation should involve a general analytical strategy to analyse what and why. Moreover, the main goal implies to treat the evidence fairly to produce compelling analytic conclusions and to rule out alternative interpretation. Yin (1994) states that researcher must choose between two followings general analytic strategy to carry out the topic: • Relying on theoretical prepositions which researcher drives the research questions from the studies conducted. This method implies that the focus can be on relevant data and ignore irrelevant data. 48 • Developing a case description which is seen as an alternative when there is little previous research in the area of the research. With the above advice from Yin (1994, 2003), the thesis will combine all relevant dimensions from literature review. The analysis templates will be processed with the following analysis. The first combination is the relationship between 2 factors: users and buying stages. The result performance makes suppliers know which requirements have to be considered in the buying stages. And suppliers should propose different selling approaches to contact each player. Users +1 Stages Gate keepers Investors Designers Operators Contractors (design librarian or assistant) Problem recognition Need description Product specification Search suppliers Solicitation, analysis 49 Evaluate, select suppliers Orders Table 12: Dimension relationship between Users and Buying stages We will not consider all of the players in the game. Regarding to investors, we only take cares of active investors because passive ones have few power to make decision. Regarding to contractors, we have classified into main contractors and sub- contractors in whom sub-contractors look not powerful. However, the thesis still care both because it depends on which product we supply, our objective is either main or sub-contractor. Another factor is a “gate keeper”. This position can be receptionist, library for designing room or Director assistant, etc. We can recognise her roles in the process to do a project. Other positions of “Buying Centre” can be considered in another topic. In addition, some titles can duplicate “players”. Therefore, we will not mention much in this research. The second dimension will consider the relationship between users and marketing mix. The conclusions makes the suppliers know what each user take cares. 50 Users+1s Investors Designers Operators 4Ps+1 Contractors Gate keepers Product Price Place Promotion Corruption Table 13: Dimension relationship between Marketing Mix and Users And finally, the third combination is the 3-dimention relationship among Buying Stages, Users and Marketing Mix 4Ps Users +1 Investors Designers Operators Gate Contractors keepers Stage Problem recognition Need description Product specification Search 51 suppliers Solicitation, analysis Evaluate, select suppliers Orders Table 14: The relationship between Buying Stages and Users 3.5. Validity and Reliability According to Erikson and Weidersheim- Paul (2001), reliability and validity of the information received within a research are extremely important aspects of a scientific study. Reliability is the trustworthiness of data collected and other researchers can find the similar results within that same time. Validity is the ability of chosen models to measure the information processed. To Yin (2003), conducting qualitative research is difficult to measure the reliability and validity because its subjects and variables are often abstract. In addition, the quantity of subjects researched is often small and limited and personal experiences are involved too much. All of the above factors cause difficult to measure the grade of reliability and validity of the research. In order to ensure value of the research, some proposed methods are given out to increase the worthiness. Firstly, the interview guide will be commented by many persons. The advice from other experts will make the questions become easier to be understood, escape confused meanings. 52 Secondly, before conducting the interview and making it become comfortable, the author made phone calls to interviewees before few days to exchange contents and ask for 15-20 minutes. The time should not be too long because the interviewees can have many works to do and loose focus when we try to ask so many questions. Thirdly, the face-to-face interview is preferred to get better understanding of the situation. Nowadays, a phone call or video Skype chat can make information flow and we will collect information. However, the face-to-face will bring more feelings, more sincerity to get the research more worthy. 53 CHAPTER 4: FINDINGS In this chapter, the relationship among three dimensions which are discussed in the chapter 3 will be withdrawn. Thereafter, two research questions will be answered basing on the conclusion. 4.1. Findings about critical selling factors After discussing 15 Users, many factors have been shared. However, some of following important factors has happened with high frequencies. These factors are divided into themes so that we can easily follow up. THEMES FACTORS Price L/C FINANCE Payment term T/T Discount Quality Classic PRODUCTS Design style Cosmopolitan Package Lead time PLACE Distribution Stock 54 Catalogues Brochures Company account PROMOTION Emails Private Gmail, Yahoo Events Customer meetings Right persons Right time APPROACH Phone- cold Phone calls Formal calls Stages Impressive presentation skills Products knowledge SOFT SKILLS On-time Good appearance: cloths Bring good solutions to customer 55 Commission Relationship OTHERS Corporate culture Figure 5: Critical factors collected during the interviews Of above 7 themes, Products and Finance are spent much time to discuss. The interviewer has tried to conduct meetings to collect much data of many aspects. However, the beginning and ending of a story usually concentrates on payment terms, price and good products which will be presented carefully in the latter parts. Here, I would like to share some other factors but they are important. Firstly, 9/15 of interviewees have negative feelings if suppliers use their public accounts like Gmail or Yahoo Mail to exchange transactions. Director of Hotel C said: “I receive so many emails to ask for products presentation everyday but I will never reply any emails used Gmail or Yahoo address. I do not think one company does not have enough money to buy their own accounts. I think they do not respect their companies. Therefore, how can I meet them for transaction?” Actually, establishing email account is a small issue but many local suppliers have not taken care as it should be. They can lose the business opportunities if this factor is ignored. Secondly, suppliers should train their sales staff knowledge of products carefully. In fact, many salespeople have brought an indifferent attitude towards their products to the meetings. Ms Vu Tam (an interior design in Ly 56 Tu Trong Street- not in this interview list) shared that many representatives come to meet her but cannot answer a simple question about the product functions. In this case, these suppliers have not respected their customers. She added: “I will never meet this company again if they basically cannot consult me how to use their products”. In reality, small companies have not attached special importance to program trainings to grow their sales teams. In reality, a powerful sales-team is a firmed background to develop their organizations in the long term. Another factor is professional appearance for salespersons. According to the author Ziglar, he said “a professional suit is your language”. The director of Resort K shared: “I do not buy their products through their cloths. What I need is good products, good price and a peaceful warranty condition. However, I feel unendurable to meet a person who put on nastily”. In the other hand, to increase the sales revenue and create a good image of their company, the owners should take care of the appearance of their sales-force, making them become professional and impressive. As some authors wrote “people do not buy the products, they buy salesperson”. Finally, another important finding is the successful rate of cold calls. Cold call is a marketing process of approaching prospective customers or clients—typically via telephone or by email—who were not expecting such an interaction. The word "cold" is used because the person receiving the call is not expecting a call or has not specifically asked to be contacted by a sales person (source: Wikipedia). 57 Many salespeople choose the easiest way is to call receptionists/ gatekeepers and meet unimportant positions then. In fact, as Ms Bich Van shared that she could not transfer the unexpected calls to her big boss. She is afraid to get the punishment if her boss is in the meetings. She usually introduces to meet unimportant persons from purchasing department, procurement, etc. Or often, she suggests salespeople should come to her office and send the catalogues. In reality, all normal salespeople have been carrying on this method and their effectiveness seems empty. The table below is the result of customers’ feedback after I have questions “Have your gatekeepers ever transferred the irregular calls to you?” or “Can a supplier meet you when s/he call your gatekeepers?” Responders Neutral Necessary  9 Users 4 Users Not necessary   2 Users Table 15: Cold calls are not an effective method As above table, I propose salespeople have to build a wide relationship not only with Users but also other suppliers. A User can introduce them the mobile-phone numbers of other Users. Or suppliers can have much mutual relationship in the business network. And a salesperson will become successful if s/he lives and works in this network. In general, after doing this thesis, I advise salespeople not to make any cold calls to look for their potential decision- makers. 58 4.2. Develop the practical approaching models Although interviewees have stated all listed factors, six (06) factors have been mentioned continually in every aspect. These factors will become the lodestar to construct the models of customer- approaches. I have arranged them with frequent order. • Products • Price • Right people • Commission • Payment terms, and • Right time Basing on these factors and proposed approaches in the Methodology, I have constructed three (03) 3-dimensions customer approaches. Suppliers or salespeople can recognise the results in accordance with their viewangles. 4.2.1. Findings of relationship between users and buying stages Users Stage +1 Problem Investors Designers Operators Contractors Gate keepers Promotion Promotion Promotion Promotion recognition Need description Product Product Product Product specification 59 Search Price Price Supplier Supplier suppliers Solicitation, analysis Evaluate, Supplier select suppliers Orders Place Place Table 16: Perspective of approaching Marketing Mix in the dimension between Users and Buying stages • The investors are the most important persons. They are concerned of all buying stages of project approaches. One investor says “we can have the power to appoint or reject brands or suppliers as long as they meet the requirements of design and quality” (Hotel C, project manager). Therefore, the suppliers need to create good relationship with investors during the construction of a hospitality project. However, according to many investors, they do not want to meet the suppliers so early (problem recognition stage) because several internal meetings (management board meeting) for financial flow (for project investment), project scale, etc. have to be discussed. One person from hospitality investor implies that nothing would be mentioned in this stage (resort E, director). Therefore, suppliers should contact investors since the second buying stage “need description”. • Product specification: totally three of users involve the projects in this stage. They are investors, designers (also architects) and hotel operators. 60 Because specification is the work of designers and architects, this part is majorly discussed about power of these people. Designers are authorised to choose products or decide item brands for specifications. Depending on the levels of hospitality projects (4 stars, 5 stars), designers will consider suitable products or material. According to some investors, “we have paid them (designers) much money and we respect their consultancy” (Hotel A, Hotel C, Resort D). We can listen to the ideas of an interior designer. This person has designed for project Hotel A in district 1, Ho Chi Minh City. She said: “I feel more comfortable to design for international projects. I have the authorised power to look for material, products, design and colours I prefer. Off course, I do this basing on my experiences and knowledge. After my specification is completed, I will present it to the investors and operators. If any, I will have time to revise it. I only suffer from work process because everything has deadlines.” However, designers are not always permitted to have full decision. The author realizes that only developers who invest capital in international hospitality projects do not intervene in designers’ affairs. Meanwhile, local investors will influence on the power of designers. Two ideas from an investor and designer will illustrate this judgement. “The project looks like my baby. I have to take care of it from the beginning. I cannot let the designers do whatever they would like. The designers always choose products which make the project more beautiful and luxurious. They do not consider much about the investment and responsibility.” (Investor of Hotel K- directing level) 61 Similarly, the designer who works for Project G in Hanoi has also exposed about her works when she is invited as an interior consultant. We can imagine how she does not feel happy: “He (the director of the Project G) visited so many factories in China. He brought catalogues and samples to Vietnam and suggested that I should choose these products (in the catalogues) for specification. He explained that he had arrived at the factories and assessed their quality very well. I chose some items into my spec. However, finally he bought products which are extremely different from my spec. In general, the items for installation are completely changed.” (Designer of Project Ga high-end condominium in Hanoi) However, although investors do not intervene in designers’ affairs in the international hospitality projects, they have the power to check and revise the specifications. According to designer of Hotel A, “many interior products are amended many times”. To search for the interior designers’ power toward hospitality projects, the author has chosen the item sanitary wares & fittings to check. The finding is summarized after the interviews are made as below. We realize that the investors authorise the designers to choose the brands/ products for specification though, the investors will revise all of these items when they consider for orders. Investors will respond the orders with the most rational, lowest-cost, most-profitable decision, based on price, features/functionality and service (Kotler and Pfoertsch, 2006). 62 Hospitality Project Specified by Final Decision by Name designers Investors Hotel A (international) Toto Grohe Hotel B (international) Grohe, Toto Grohe, Kaldewei Hotel C (international) Kohler Grohe, Hansgrohe Resort D (international) Grohe, Nahm Grohe, Nahm Hotel E (international) Toto Hansgrohe Table 17: Considerable changes of ordering sanitary and fittings in the hospitality projects managed by international operators Resort F (local) Grohe, Toto Grohe, Kaldewei Project G (local) Bravat Grohe Hotel H (local) Toto Toto Hotel K (local) Toto, Grohe Toto, Grohe Resort L (local) Toto Toto Table 18: Small changes of ordering sanitary and fittings in the hospitality projects managed by local investors The table above and some opinions of investors bring the research to two other questions. Firstly, why do investors who invest capital in the international hospitality projects do not intervene much in specified stage of designers? Meanwhile, they take cares of all processes regarding to local projects. Secondly, investors look to revise items of international projects more than of local ones. These questions are answered after the interviews are made with hotel operators and some investors. In addition, the important role of hospitality operators is showed. 63 In the international projects, investors have to complete the projects with requirements and standards which issued by hospitality operators. “The terms, standards and requirements from the operators can contain approximately 10 thousand of papers” (project manager, international resort D). To secure the project quality, the operators invites or appoints international designers and architects who have experiences about the operators’ projects over the world. The process of management of an international hospitality project is often regulated as followings: Investors Appoint Manage Project Hospitality projects Propose and Appoint Designer/ Architects Figure 6: Models of international hospitality management Meanwhile, local projects are directly managed by investors. In this situation, investors will employ the workers and operate the project after it is finish the construction. Manage Investors Project Employ Designer/ Architects Figure 7: Model of local hospitality project management 64 In the research table, we recognized items which are specified are much changed in the international projects. Due to the fact that the investors handover the responsibility to the designers and do not intervene in this stage, they will spend more time on amending the specification and looking for the replaced items if possible. Because all investors expect to buy items with the most competitive price, the brand A or B is not important anymore as long as the replaced products are “meet the requirements about original design and quality”. We can take two examples to recognise the problems more clearly. Bathtub specified Brand A and bathtub ordered Brand B On the contrary, the local projects have few changes of specification. Their investors have involved at specification from the early stage. Therefore, in case other competitors do not offer any extremely special quotation, the possibility to keep the original specifications is ensured. 65 International Specified Final Orders Conclusion Hospitality Project Hotel A Toto Grohe Changed Hotel B Grohe, Toto Grohe, Changed Kaldewei Hotel C Kohler Grohe, Changed Hansgrohe Resort D Grohe, Nahm Grohe, Nahm Kept Hotel E Toto Hansgrohe Changed Table 19: Specifications are changed much in the international hospitality In the local projects, the research recognises a lower rate of change. Local Project Name Resort F Specified Grohe, Toto Final Orders Grohe, Conclusion ½ changed Kaldewei Project G Bravat Grohe Changed Hotel H Toto Toto Kept Hotel K Toto, Grohe Toto, Grohe Kept Resort L Toto Toto Kept Table 20: Specifications are majorly kept for final installation About the roles of hospitality operators, all of the investors and suppliers confirm that “they often visit the showrooms to choose products with designers and investors” (Nguyen Minh Cuong) and they have “important voice” to choose products/ brands and consult investors to choose them. 66 • Search for potential suppliers and evaluate: After the specifications or the replaced items have been confirmed, the investors and contractors will process to find the potential suppliers. According to investor of Hotel B, “looking for the suppliers stresses her a lot”. She added: “I have to contact many suppliers in Vietnam and overseas to choose the suitable partners. Many emails to ask about the quotation, negotiate the price cause me impossible to sleep”. This information means the investors and contractors (buyers) are trying to find good partners who can offer the most competitive quoting. Therefore, suppliers have to establish the good relationship with investors and contractors in this stage. As Mr Nguyen Minh Cuong (sales manager) shares: “I often call them to visit the showroom, visit the factories to check the quality of the products. Besides, entertaining with customers happens quite often when the projects are coming to complete”. The suppliers should have the good relationship with investors, contractors because they will know about their competitors’ behaviours. In some case, if suppliers have the good relationship, investors can share with these suppliers what they need. “If you win the information, you will be awarded the order”, a director of Project G says. • Proposal solicitation and analysis In addition to searching the potential suppliers, investors and contractors have to qualify them with important criteria. The criteria can be different. However, the most important factor which every investors and contractors consider is financial ability. Actually, a supplier with poor finance 67 can deliver orders late. In this case, investors and hospitality operators can suffer the loss due to the fact that the late delivery may influence on project launching. The project manager of a five-star hotel in Hanoi has shared with me about this real situation. “I signed a commercial contract with a distributor to supply products for water- supply package. The total amount of this contract evaluates up to USD3 million. My company deposited 20% of the total amount. After 3-month-lead time nearly passed, the distributor informed not to deliver the order on time. My company faced a serious risk to be fined VND1.5 billion/ day. The true reason caused the distributor not to deliver the products on time because they did not have enough money to pay LC to the manufacturer.” (Project manager- Hotel E) • Supplier evaluation and selection The investors or contractors award the suppliers basing on the different criteria established in the previous stages. • Order-routine specification Investors or contractors generate the orders to meet the process of projects. • Performance review Investors or contractors receive the orders. Review the performance of suppliers, check every document and release the LC deposit if yes. 68 4.2.2. Findings of relationship between users+1 and 4Ps+1 Users Investors Designers Operators Products spec Products Products spec spec Contractors 4Ps+ Product Search suppliers Search Price suppliers Place Search supplier Promotion Need description Corruption Need description Solicitation Search supplier Table 21: Perspective of approaching Buying Stages in the relationship between 4Ps and Users In this dimension, we will investigate 4Ps’ factors which each User take cares. Suppliers should realize that some users do not take interest in all of the elements. • Products: Investors, designers and operators care much of products which are specified or chosen for the projects. “I spend much time looking for the good products because they are our properties forever” (Resort F- directing level). On the contrary, if the investors pay money to build a condominium, they will not consider what items should be chosen a lot. In this case, the condominium project has been sold forever to end-users. In addition, the contractors are not concerned in the products because they only buy the 69 items basing on the available specification. Ms Dang Thuy Nga shared her opinions: “I never call contractors to ask the meetings if I am not advised by investors. What they care are good price and commission. They do not consider how well our products perform. I prefer to work with designers and if possible, working with investors is always the best”. • Price: investors, contractors Investors and contractors can be the persons who will evaluate the suppliers to make purchases. The percentage of discount and the credit terms are two of the most considerable issues. “Many suppliers offer the products with special price. However, their credit terms with tough conditions also cause us difficult to continue. We cannot make payment “TT in advance” (pay 100% before delivery) instead of depositing 20% to each order” (Hotel A- investors). However, we can listen to another sharing from Mr Nguyen Van Hai to realize that negotiating the credit terms also makes big attempts. “I also discount deeply to win the contracts. The company margin looks not profitable. However, the credit terms must be good enough. Investors have to issue LC at least to secure the payment. In this economy situation, the 3-month debts cause a loss”. (Nguyen Van Haidirector of kitchen & home appliances) In conclusion, investors/ contractors and suppliers have to contribute many discusses to reach the same agreements. This step is extremely difficult and sometimes many contracts are terminated. 70 • Place: investors and contractors To specify a brand and make a purchase, distribution of suppliers and available stock is necessarily considered. Many ideas have been shared when the authors ask about this element. “After 1-2 years, some products or spare- parts can be damaged and do not work. Therefore, a replacement or maintenance requires the products readily. If we have to wait for 2- 3 months for importing, our projects will be influenced.” (All investors and contractors respond) • Promotion: investors and contractors Promotion is not required within this period. Catalogues or direct emails should be sent after the investors recognize the needs. • Corruption: investors, designers and contractors The author asks totally 6 sales managers. Almost all of them regard corruptions as the key factors to continue the transactions. To them, giving commission does not ensure an award. Sometimes, if the commission eats a lot, it impacts badly on total price and harms competition. After the interview with suppliers, 2 kinds of corruptions are recognised 1) Paying by cash Giving the corruption by cash is paid to managing level. They are employees of the organizations. “It depends on the total value, the commission can be paid from 2%-10%” (Nguyen Minh Cuong and Nguyen Van Hai). 2) Increasing the total amount in the contracts The true owners who use their own capital to invest into the projects will be paid corruption by this method. Mr. Cuong shares “The value of contract will be marked-up 15%-20%. Investors will enjoy the surplus from the banks. 71 They will use this surplus to do other things”. (Nguyen Minh Cuong- sales manager) To make this problem clearer, the author would like to give an example. Supposing that real value of the contract is VND 10 billion. However, investors would like to mark-up it into VND 12 billion. Investors will use this commercial contract to borrow VND 12 billion from the banks. The surplus of VND 2 billion will benefit the investors. Writing about corruption is extremely sensitive. Therefore, the author would like to finalize this part with conclusion: to hospitality project approaches, paying commission is compulsory. 4.2.3. Findings of relationship between Buying stages and Marketing mix 4Ps+1 Corruption Products Price Promotion Place Stage Problem recognition Need description Investor Product specification Investor/ Designer Investor Designer Search suppliers Solicitation, Investor/ Investor Investor Investor Investor contractor Operator 72 analysis Evaluate, select Investor/ suppliers Investor Investor/ Contractor Contractor Investor/ Contractor Investor/ Orders Contractor Investor/ Investor/ Investor/ Investor/ Review Contractor Contractor Contractor Contractor Table 22: Perspective of approaching Users in the relationship between 4Ps and Buying Stages • Problem recognition: all of the 4Ps’ factors are not required because investors would like to spend time on internal discuss to form the projects. • Need description: even when the project is defined, the products and their price are required to know. Investors would like to estimate the budget for the project construction. • Product specification: the products and price should be updated by suppliers. In this step, investors and designers are looking for the products for specification. According to some experienced sales manager, only 1-2 brands of each item are specified, corruption should be mentioned to architects or investors so that they can support the brands (Nguyen Van Hai, Nguyen Minh Cuong, Nguyen Xuan Lynh) • Search for potential suppliers: all of the 4Ps factors are mentioned. Suppliers should update catalogue, send advertising emails to remind customers. In addition, a good relationship with investors has to be established. 73 • Proposal solicitation and analysis: Suppliers have to submit their qualified certifications about capital flow, project references, capacity, etc. which will be selected for tendering. Price and distribution system will be presented to show the strong points of the organizations. • Evaluate and select suppliers: The final decision to select the awarded suppliers is based on their price, place, promotion and commission. The promotion is mentioned because it helps to remind investors of suppliers’ presentation. • Orders: inform customers about the lead-time and convince them about the ready stocks and good services in case they need spare- parts for latter replacements. However, this information should be discussed during the sales approaches. • Review: demonstrate all services of suppliers are qualified. Continue to take care of customers for other projects later on. 74 CHAPTER 5: CONCLUSION AND RECOMMENDATIONS In this chapter, the conclusion of the research which supports suppliers or sales people to perform project sales better will be conducted. In addition, the conclusion gives further proposals and limitations to strengthen the research if this topic is continued in the future. 5.1. Conclusions So many suppliers in the marketplace have caused a harsh competition. Therefore, to increase the sales revenue more and more, each supplier has to build a practical plan to approach customers. Three 3dimension conclusive tables will support sales managers to construct a sales plan effectively. And depending on the perspectives, sales managers can choose one of 03 approach models or generalize all of them. One hospitality project is divided into eight Buying Stages. The sales managers should be sophisticated to choose right time (when) they should approach, right persons (who) they have to establish the long- term relationship, and which items (what) they present with customers. The Users would like to solve their works step by steps, not short- cut. The stage of Product specification is the most important. To local hospitality projects, investors will go to showrooms to choose suitable products to specialize. After they choose the products for specification, these selected brands are majorly secured by a business contract. Meanwhile, to international hospitality ones, the investors will authorize designers to make decisions. However, they will revise all items in the specifications to fit the 75 budget constrain. Therefore, the sales managers always have to keep in touch with the investors and perform more to win the sales. It is necessary to build the relationship not only with Users but also with suppliers. In many cases, they can share the involved project information much more than Users unable. An excellent sales manager is the person who creates a wide network. And finally, doing business should be flexible. We should not give up the projects until the investors officially book the orders of competitors. So if we lose the stage 3 or 4, we have to perform more excellently to find the opportunities. 5.2. Recommendations To approach a hospitality project with right time, right persons, and right things is not simple or easy. It requires sales managers to master project update all the times. Meanwhile, the cold call is not the effective way. They should work hard and expand the customer relationship. In addition, the owners of trading companies (suppliers) should equip salespeople with sales techniques so that they can recognise what to do for each stage. Moreover, building the company images should be always respected. Private email accounts must not be used in the business transactions. Next, the ethical perspective business does not encourage salespeople to pay commission in order to win the contracts. But anyway, corruption plays an important role to be awarded as the analysis. However, there is the fact that the more powerful decision makers we work, the less corruption we have to pay. Therefore, try to expand the relationship with CEOs, General 76 Directors or Chairmen who hold the decisive roles in their companies. The more commission we pay, the less competition our quotation becomes. Finally, three 3D- tables of approaches will support salespeople to sell more. Following these tables, they will expand the relationship with customers and learn sales techniques to develop their qualified ability. 5.3. Limitations Although the research has studied three dimensions, many factors which support project sales have not mentioned. In reality, the good relationship with investors can help suppliers bypass the process. Or sales approaches can be not necessary to follow up steps by steps as in the research. 5.4. Further research This study has provided suppliers and salespeople with the effective approaches which encourage them to increase performance. Although many proposals, factors have been tried to analyse; this topic mentions about a vast problem. Therefore, other people can contribute the approaches by many perspectives for future researches. The related researches can be investigated project- sales methods many aspects followings: • Focus on project sales in Hanoi. How different from this research when it is focused in the South of Vietnam. • Expand the topic to the real-estate approaches, not only about the hospitality projects as this research. • Look for other models to enhance the project sales 77 References: 1. Stephan Schiffman (2007), “Cold call techniques (that really works!)” 6th edition, ISBN: 1-59869-1-481, Published by Adam Media 2. Lee Boyan (1989), “Successful Cold Call Selling- over 100 New Ideas, Scripts, and Examples from the Nation’s Foremost Sales Trainer”, 2nd edition, ISBN 1-8144-7718-6, AMACOM 3. Balram Dogra and Karminder Ghuman (2008), “Rural Marketing: Concepts and Practices”, 2nd edition, page 80, ISBN 987-0-07-0660007, Tata McGrawhill 4. Gaylon E. Greer & Phillip T. Kolbe (2003), “Investment Analysis for Real Estate Dicision”, 5th edition, ISBN 0-7931-3660-1, Dearborn Real Estate Education 5. Website: http://www.investorwords.com/2630/investor.html#ixzz2LFbcK0B7 6. Peter Marsh (2000), “Contracting for Engineering and Construction Projects”, 5th edition, ISBN 0-5660-8282-9, Gower Publishing Company 7. A. D. Austen and R.H. Neale (1995), “Managing Construction Projects: A Guide to Processes and Procedures”, 4th edition, ISBN 92-2-109476X, International Labour Office Geneva. 8. S. Keoki Sear, Glenn A. Sears and Richard H. Clough (2008), “Construction, Project Management: A Practical Guide to Field Construction Management”, 5th edition, ISBN 978-0-471-74588-4, Published by John Wiley & Sons Inc. 9. Marilyn Klinger & Marianne Susong (2006), “The Construction Project: Phases, People, Terms, Paperwork, Processes”, ABA Publishing 10. John E. H. Sherry (1993), “The Laws of Innkeepers- For Hotels, Motels, Restaurants and Clubs”, 3rh edition, ISBN 0-8014-2508-5, Copy right by Cornell University 11. Philip Kotler (1999), “Kotler On Marketing”, ISBN 0-684-84498-2, Free Press, Website: www.simonsays.com 12. Godfrey Harris (2004), “Corruption- How to Deal with Its Impact On Business and Society”, ISBN 0-935047-39-7 13. Philip Kotler and Waldemar Pfoertsch (2001), “B2B Brand Management”, 1st edition, ISBN 3-540-25360-2, Springer 14. Hauke Barschel (2004), B2B Versus B2C Marketing- Major Differences Among The Supply Chain of Fast Moving Consumer Goods (FMCG), ISBN 978-3-638-78189-3 15. Michael D. Hutt & Thomas W. Speh (), Business Marketing Management b2b, 5th edition 16. Mc Daniel (2010), Marketing, 1st edition, ISBN 10: 0-32459109-8 17. BCI Asia (www.bciasia.com) https://services.bciasia.com/view/project.cfm?CFID=137719&CFTOKE N=74688674&focus=1&project_refid=102421610956569 18. Ziglar (2010), Concretes to win sales, 3rd edition 19. Qualitative versus Quantitative research (Johnson & Christensen, (2008) and Lichtman, (2006)) [...]... fittings in the hospitality projects managed by local investors 63 Table 19: Specifications are changed much in the international hospitality 66 Table 20: Specifications are majorly kept for final installation 66 Table 21: Perspective of approaching Buying Stages in the relationship between 4Ps and Users 69 Table 22: Perspective of approaching Users in the relationship between 4Ps and Buying Stages... quality Therefore, beside to financing marketing programs, the companies should look for suitable ways to approach potential customers And depending on types of business, each company applies a different customer approach Actually, if B2C enterprises attract their customers by financing marketing programs, organizing events and expanding distribution channels; B2B companies of hospitality industry take... projects in construction for recreation and accommodation such as casinos, entertainment parks, resorts or hotels (Josef Ransley, 2004) The hospitality industry which is a branch of real estate is sketched as the below figure 2 Office Building Resort Residential Hotel HOSPITALITY Casino REAL ESTATE Parking Entertainment Park Industrial Park Commercial Center Figure 1: Hospitality industry- a branch of real... hospitality industry In fact, many authors have announced several factors or models regarding to transactions in B2B business or involving influencers Kotler is well-known as the father of modern marketing His works are valuable references for any companies before launching products We also know about McCarthy (1940) with 4Ps model which is classic work for any advertising and selling programs In general,... OF TABLES Table 1: The local and foreign visitors to Vietnam considerably increased since 1990 4 Table 2: Foreign Direct Investment (FDI) into the hospitality industry in Vietnam since 1995 Table 3: Some of construction material required for hospitality projects 4 6 Table 4: Well-known interior designers and architects attended projects in Vietnam 12 Table 5: Global hospitality operators managing the... firm has to have management experiences and prestigious brand and good financial capacity b) Sub- contractor Modern industrial activity is based on specialization and the combining of many specialist skills to form an integrated body The main contractor cannot have specialists for all of the stages of a project Therefore, to finish the works, the main contractor must rent other smaller contractors... invest into projects with expectation of financial return Investors are categorised into four types: by the natures of their claims (debt or equity), or according to their degree of involvement in operations (passive or active) a) Investment in Equity and Debt The distinctions are made between investment in real assets such as land and buildings and in real estate (hospitality) - related financial assets... 51 Table 14: The relationship between Buying Stages and Users 52 Table 15: Cold calls are not an effective method 58 xi Table 16: Perspective of approaching Marketing Mix in the dimension between Users and Buying stages 60 Table 17: Considerable changes of ordering sanitary and fittings in the hospitality projects managed by international operators 63 Table 18: Small changes of ordering sanitary and... take responsibility to follow the specification and secure the quality of construction with the available financial budget Many types of contractors are attended but they can be classified into main contractor and sub-contractors a) Main contractor The main contractor is someone who takes charge of and manages all stages or parts of the project He must always update on-site operation to investors and... call sub-contractors Normally, the contract between employers and the main contractors does not create any contractual obligations about renting the sub-contractors 4) Hospitality Operator A hospitality project will be divided into two types regarding to management: investors can manage their projects by themselves, or they can invite an international hospitality operator to manage their project Hospitality .. .EXPLORE A WINNING SALES APPROACH FOR HOSPITALITY INDUSTRY IN VIETNAM In Partial Fulfilment of the Requirements of the Degree of MASTER OF BUSINESS ADMINISTRATION Major at International Business... Residential Hotel HOSPITALITY Casino REAL ESTATE Parking Entertainment Park Industrial Park Commercial Center Figure 1: Hospitality industry- a branch of real estate 1.2.3 B2B hospitality projects in. .. product’s availability and benefits Promotion’s goal in the marketing mix is to bring about mutually satisfying exchange with the target markets by informing, educating, persuading, and reminding customers