Xây dựng một chiến lược cạnh tranh cho năm 2017

TR NG IH CM TP HCM UNIVERSITÉ LIBRE DE BRUXELLES HOCHIMINH CITY OPEN UNIVERSITY SOLVAY BRUSSELS SCHOOL MBAVB4 NGUY N M NH QUÂN BUILDING A COMPETITIVE STRATEGY FOR VILC UNTIL 2017 MASTER PROJECT MASTER IN BUSINESS ADMINISTRATION (PART-TIME) Ho Chi Minh City (2012) DECLARATION I hereby declare that this project is written by myself as requested by the Part-time MBA program from Ho Chi Minh city Open University and Solvay Brussels School In the project, I use the theories from book published by well-known authors as Michael E Porter and other authors whose studies and researches related to my studies Besides, I also collect data and information from reliable sources as reports, magazines, newspaper, Vietnam GSO, Vietnam financial lease association… In addition, I also pick up some information from previous projects studying the same issues All extracted information and data are attached with links to the author and original sources to ensure author rights I also use the guidelines and instructions from Tutor, Professor Nguy n Minh Ki u from Ho Chi Minh city Open University to accomplish this project Ho Chi Minh city, October 2012 NGUYEN MANH QUAN ACKNOWLEDGEMENTS I would like to thanks all Professors of the program who bring me valuable knowledge to accomplish this project I would like to show my sincere thanks to Professor Nguyen Minh Kieu who tutored me with interesting experience throughout the project Special thanks to Ms Nguyen Thuc Dao – Finance and Planning Manager of VILC who inspired me with this subject and who dedicate strong supports to me during this project Thanks all colleagues who kindly support me to finish this project Ho Chi Minh city, October 2012 NGUYEN MANH QUAN COMMENTS FROM THE TUTOR ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… ……………………………………………………………………………………………… TABLE OF CONTENT DECLARATION………………………………………………………………………… ACKNOWLEDGEMENTS……………………………………………………………… .4 COMMENTS FROM TUTOR…………………………………………………………… EXECUTIVE SUMMARY……………………………………………………………… 10 ABBRIVIATIONS……………………………………………………………………… 11 LIST OF TABLES……………………………………………………………………… 12 LIST OF FIGURES……………………………………………………………………… 13 REFERENCES………………………………………………………………………… 81 APPENDIX 1: CUSTOMER SURVEY FORM………………………………………… 82 APPENDIX 2: CUSTOMER SURVEY RESULT……………………………………… 84 CHAPTER 1: INTRODUCTION 1.1 Rationale of the study……………………………………………………………… 14 1.2 Objective of the study……………………………………………………………… 15 1.3 Research methodology……………………………………………………………… 15 1.4 Scope and limitation of the study…………………………………………………… 16 1.5 Structure of the study………………………………………………………………… 16 CHAPTER 2: LITERATURE REVIEW 2.1 General concept……………………………………………………………………… 18 2.1.1 Strategy…………………………………………………………………………… 18 2.1.2 Competitive strategy……………………………………………………………… 19 2.2 Strategy analysis tools…………………………………………………………………20 2.2.1 SWOT analysis………………………………………………………………………20 2.2.2 PEST analysis……………………………………………………………………… 21 2.2.3 Porter’s five forces………………………………………………………………… 22 2.2.4 Value chain analysis…………………………………………………………………26 2.2.4.1 Primary activities………………………………………………………………… 27 2.2.4.2 Support activities………………………………………………………………… 27 2.3 Porter’s generic strategies…………………………………………………………… 28 2.3.1 Cost leadership strategy…………………………………………………………… 28 2.3.2 Differentiation strategy…………………………………………………………… 29 2.3.3 Focus strategy……………………………………………………………………….29 2.4 Strategy formulation process………………………………………………………….29 2.4.1 Company’s mission…………………………………………………………………29 2.4.2 Company’s objectives………………………………………………………………30 2.4.3 Situation analysis………………………………………………………………… 30 2.4.4 Strategy formulation……………………………………………………………… 31 2.4.5 Strategy implementation…………………………………………………………….31 2.4.6 Control…………………………………………………………………………… 31 CHAPTER 3: EXTERNAL ENVIRONMENT ANALY 3.1 Macro environment analysis………………………………………………………… 32 3.1.1 Political, governmental and legal factors………………………………………… 32 3.1.1.1 Vietnam’s politic………………………………………………………………….32 3.1.1.2 Government’s policies…………………………………………………………….32 3.1.1.3 Legal framework………………………………………………………………… 33 3.1.2 Economical factors …………………………………………………………………33 3.1.2.1 Vietnam economy overview…………………………………………………… 33 3.1.1.2 An outlook of Vietnam economy…………………………………………………38 3.1.3 Social factors ……………………………………………………………………….38 3.1.4 Technology factors …………………………………………………………………39 3.2 Micro environment analysis ………………………………………………………….39 3.2.1 Industry, market and competitors overview……………………………………… 39 3.2.2 Porter’s five forces driving financial lease industry competition………………… 44 3.2.2.1 Intensity of rivalry ……………………………………………………………… 44 3.2.2.2 Threats of substitute products …………………………………………………….45 3.2.2.3 Potential of new entrants………………………………………………………… 46 3.2.2.4 Bargaining power of buyers ………………………………………………………48 3.2.2.5 Bargaining power suppliers……………………………………………………… 50 3.2.3 Summary of Porter’s five forces analysis………………………………………… 51 4.1 Company’s profile……………………………………………………………………53 4.1.1 Introduction……………………………………………………………………… 53 4.1.2 Vision and mission…………………………………………………………………53 4.1.2.1 Vision…………………………………………………………………………….53 4.1.2.2 Mission………………………………………………………………………… 53 4.1.3 Products and services………………………………………………………………54 4.1.4 Procedure of financial lease……………………………………………………… 55 4.1.5 Performance summary…………………………………………………………… 55 4.2 Porter’s generic value chain analysis……………………………………………… 57 4.2.1 Primary activities………………………………………………………………… 57 4.2.1.1 Marketing and sales activities……………………………………………………57 4.2.1.2 Inbound logistic activities……………………………………………………… 58 4.2.1.3 Operation activities………………………………………………………………58 4.2.1.4 Service activities…………………………………………………………………59 4.2.1.5 Outbound logistics activities…………………………………………………… 59 4.2.2 Support activities………………………………………………………………… 59 4.2.2.1 Finance and treasury activities………………………………………………… 59 4.2.2.2 Credit risk management activities……………………………………………… 60 4.2.2.3 Human resource management activities………………………………………….60 4.2.2.4 Corporate support activities………………………………………………………60 4.3 SWOT analysis……………………………………………………………………….60 4.3.1 Strengths…………………………………………………………………………….61 4.3.2 Weaknesses…………………………………………………………………………62 4.3.3 Opportunities……………………………………………………………………… 63 4.3.4 Threats………………………………………………………………………………64 5.1 Three level of strategy……………………………………………………………… 66 5.1.1 Corporate level strategy…………………………………………………………… 66 5.1.1.1 Growth strategy……………………………………………………………………67 5.1.1.2 Portfolio strategy………………………………………………………………… 69 5.1.2 Business level strategy………………………………………………………………70 5.1.2.1 Differentiation strategy……………………………………………………………71 5.1.2.2 Focus strategy…………………………………………………………………… 74 5.1.2.3 Competitive tactics……………………………………………………………… 74 5.1.3 Functional strategy………………………………………………………………… 75 5.1.3.1 Marketing strategy…………………………………………………………………75 5.1.3.2 Financial strategy………………………………………………………………….75 5.1.3.3 The operating procedures………………………………………………………….76 5.1.3.4 Human resource strategy………………………………………………………… 76 5.1.3.5 Information system strategy……………………………………………………….76 5.2 Strategy implementation………………………………………………………………76 5.2.1 People……………………………………………………………………………… 77 5.2.2 Resource…………………………………………………………………………… 77 5.2.3 Structure…………………………………………………………………………… 77 5.2.4 System……………………………………………………………………………….77 5.2.5 Culture……………………………………………………………………………….78 10 EXECUTIVE SUMMARY It is important that financial lease companies deliver quality services which in turn results in customer satisfaction in today’s competitive financial services environment Within the Vietnam financial service market, competition is deemed to be strong with many financial institutions who can provide nearly same as financial lease services as bank loans, operating lease, finance company, investment fund In addition, Vietnam and global economy has been facing difficulties in recent years so it made the competition become tougher and tougher To confront with above challenges, this study strives to analyze both external and internal factors affected to VILC’s business to recommend the competitive strategy for VILC until 2017 Base on PEST analysis, VILC’s SWOT analysis, Vietnam’s financial lease industry analysis, customer survey and other elements that affected VILC’s business, this study recommends some ideas about competitive strategy of VILC In corporate level strategy, the company should pursue growth strategy by implement both horizontal integrate strategies and diversification strategy In business level strategy, it is recommended that VILC should implement Differentiation strategy and focus strategy which is best fit to VILC’s business 11 ABBREVIATIONS AFTA: ASEAN Free Trade Area ASEAN: Association of Southeast Asia Nations BMI: Business Monitor International CIEM: Central Institute For Economic Management CPI: Consumer Price Index EU: Europe FDI: Foreign Direct Investment GDP: Gross Domestic Product GSO: General Statistic Office KDB: Korean Development Bank L/C: Letter of Credit NPL: Non Performing Loan PEST: Political, economical, Social and Technology analysis SBV: State Bank of Vietnam SME: Small and Medium Enterprise SOE: State Owned Enterprise SWOT: Strengths, Weaknesses, opportunities, Threats U.S.A: United States of America USD: United States Dollar VILC: Vietnam International Leasing Company WTO: World Trade Organization 71 level strategy definitely has to support the corporate level strategy and match its activities with overall corporate goals This study will consider competitive strategy by using Porter’s four generic strategies to create a competitive advantage and defend against the adverse effects of the five forces VILC is recommended to use differentiation strategy and focus strategy derived from Porter’s generic strategies as follows: 5.1.2.1 Differ entiation str ategy: As Porter, differentiation is the strategy to create something that is perceived industry-wide as being unique to buyer’s value It can be achieved through several forms: design, technology, features, customer services, dealer network, or other Ideally, the firms should differentiate itself along several dimensions Different does not allow a firm ignore costs; it makes a firm’s products/services less susceptible to cost pressures from competitors because customers see the products/services as unique and are willing to pay extra to have the product with the desirable features Differentiation can be achieved by creating values through three dimensions: • Lowering buyer’s costs: higher quality, less breakdowns, and quicker response to the problems • Raising buyer’s performance: products/services help buyer improving their performance • Sustainability: create barriers by perception of uniqueness and reputation, creating high switching costs through differentiation and uniqueness To implement Differentiation strategy combining with value chain of VILC, this study recommends four dimensions: Marketing and sales, Credit appraisal activities (Inbound logistics), Portfolio activities (Operations) and Services, which are defined in Porter’s value chain as below table: 72 Corporate support activities MARGIN Credit risk management activities Finance & treasury activities Human resource management X X X Marketing & sales Credit appraisal activities Portfolio activities Services MARGIN X Outbound logistics F igure 18: Value chain for VILC Marketing and sales: Formerly, VILC has not paid enough attention to marketing activities so the company is lack of building their image to customers Therefore, VILC should build their image to thee target customers: Vietnamese enterprise, Korean enterprise and Japanese enterprise operated in Vietnam to be a reliable financial institution in customer’s mind In addition, the company also focused on PR activities base on its events to make customer familiar with both financial lease services and VILC image Furthermore, the company should build up potential customer data system for sales activities because currently VILC is lack of this data system Thus, sales activities are not really efficiently Building relationship and corporation with vendors should be a long-term strategy of VILC through buy back guarantee agreement It helps VILC to expand its channel to approach customers to increase sales in the future Last but not least, VILC should be flexible in pricing to meet customer’s needs For instance, the company should manage pricing condition by net yield which is calculated by gross yield minus cost of fund By this management, pricing factors as security deposit, down payment, residual value, interest rate and commitment fee can be adjusted which is proper to VILC’s and customer’s need 73 In these activities, VILC should build a credit rating system for both existing customers and potential customers to support to credit appraisal activities and offering lease conditions as well Base on this credit rating system, the credit officer can be easy to offer a proper lease and loan conditions to customer It will reduce time for credit officer to get approval from BOD and serve promptly customer’s need which is very important for this activity In addition, credit officer can refer by credit rating system to reduce time in appraisal activities which bring timely services to customers The customers are quite sensitive with portfolio activities which play an important role in company’s services To delivery the excellent services to customer, VILC should improve these areas below: Prepare sales contract: To reduce time to execute a lease, portfolio department should prepare sales contract in advance before the customer gets approval if any Besides, the company should flexible in payment terms and import consignment contract to customer For instance, VILC can consign import duty to customer who has favourable payment terms offered by supplier as deferred L/C or VILC accepts deferred L/C payment In financial field, consultant service is very important so the company has to increase its consultant service through preparing sales contract which give the advices to reduce risks for customers Timing in service: the company should set timing procedure for each detailed activity again which is proper to the practical and they have to commit to that procedure Simplifying the procedure and documents also helps company to earn satisfaction from customers The company should reconsider their procedure and needed documents from customers then it cut down unneeded stages and documents 74 The banks may collect fee when customer requires them to confirm their outstanding balance, copy… But VILC should not that with their customers This is like added services that VILC provides to customers to earn more satisfaction from their customers In addition, VILC can build customer information system through its website The customer can access internet and find what needed information of their company 5.1.2.2 Focus str ategy: This strategy involves concentrating on a particular customer, product line, geographic area, channel of distribution, stage in the production process, or market niche The underlying premise of the focus strategy is that the firm is better able to serve its limited segment than competitors serving a broader range of customers Firms using a focus strategy simply apply a cost-leadership or differentiation strategy to the segment of the larger market VILC with above analysis should not compete on the market segment that requires lowest price Instead, the company should focus on the market segment that they have an advantage as Korean enterprises and Japanese enterprises VILC should overview this market segment and work closely with its Japanese shareholder about its penetration plan in Japanese segment The new department will be trained appropriate to Japan culture which earns professional feeling from target customers By its shareholder’s network, VILC will be easier to penetrate in this segment 5.1.2.3 Competitive tactics: Although a choice of the generic competitive strategies discussed in the previous sections provides the foundation for a business strategy, there are many variations and elaborations Two categories of competitive tactics are dealing with timing (when enter the market) and market location (where and how to enter/ or defend) Timing tactics: To implementing a strategy, timing plays an important role in each implementation We often consider the company as first movers, second movers or late movers… Each tactic has its advantages and disadvantages In current market, there seems to be no company have strategic plan to penetrate to Japanese market so VILC shall be a first mover in this industry It helps VILC to have major advantages as: building image and 75 reputation to customers, making the first-time customer and remaining the loyalty in repeating deals, and build the barriers to other competitors Market location tactics: These include two tactics: offensive tactics and defensive tactics Offensive tactics designed to take market share from a competitor while defensive tactics attempt to keep a competitor taking away from existing market share VILC is recommended to use both tactics to sustain its advantages by competing against competitors base on flexibility in pricing and services, added services and strong network from shareholders, and remaining existing customers to repeat leasing with VILC 5.1.3 Functional str ategy: The functional strategy level of organization is the level of the operating divisions and departments The strategic issues at the functional level are related to business process and the value chain Functional level strategies in marketing, finance, operations, human resources involve the development and coordination of resources through which business unit level strategies can be executed efficiently and effectively 5.1.3.1 Mar keting str ategy: Marketing strategy is related to the pricing strategy, market, target customer, services and promotion As mentioned above, VILC should penetrate to Japanese market to exploit its advantage along with maintain its traditional market (Vietnamese enterprise and Korean enterprise) In addition, the company has to consider their pricing conditions which separates by credit rating because customer survey shows that 62% of customers think that VILC’s pricing condition is acceptable and 27% of customers consider it as high price Along with considering pricing condition, VILC also has to pay attention to enhance its services to meet customer need because as customer survey, there are still 38% of customers are not satisfied with VILC’s service Therefore, the company should improve it by operation strategy and human resource strategy 5.1.3.2 Financial str ategy: In financial area, capital plays an important role in company’s operation VILC currently has the lowest capital in financial lease industry so the increasing of capital helps the 76 company to reduce cost of fund Hence, it can offer favourable price to good customers In addition, with strong capital, the company can spread out its network to increase its market share 5.1.3.3 The oper ating pr ocedur es: VILC needs to set operating procedures as fundamental base for its growth These procedures must be continuous reviewed, updated and improved to meet changing demand of customers This should follow the details as earlier analyzed in Differentiation strategy 75% of customers in the survey request VILC to improve the operating procedures, especially in flexibility service 5.1.3.4 As a service company, human resource also acts important in its services quality The company needs to have a clear performance appraisal and offer more incentives and bonus to their employee to keep valuing people In the meantime, the employee must be participated in training course continuously for both professional skills and soft skills to ensure high service quality because only 62% of customers are satisfied with service quality at VILC VILC also needs to strongly fire unqualified employee to stabilize their services 5.1.3.5 Infor mation system str ategy: Information system should be updated and flexible proper to customer’s needs In addition, VILC have to build more services through internet as searching services on their website by linking their software to website Hence, customer can check their lease status easily by internet which reduce time and cost 5.2 Str ategy implementation: Implementation is the process of turning strategies into actions in order to accomplish strategic objectives and goals To implement successfully the suggested strategies, the company should allocate, coordinated and integrate the strategies with suitable resource, structures and control measures This study considers five key organizational components 77 – People, Resource, Structure, System and Culture which influence to the implementation of the company strategies 5.2.1 People: A strategy is generally base on organizational competency that in turn is base on human resource VILC should recruit and allocate right people in new Japanese marketing department to deploy its strategy Besides, the company has to provide enough training course to improve skills for its employees to ensure its highest service quality Especially, the company should motivate and empower people who have experience and knowledge to help the company achieving its goals 5.2.2 Resour ce: Successful strategy implementation requires the needed resources are fully committed to support it in practice Sufficient resources should be allocated with respect personnel and funding As mention in people sector, the company has to allocate right people at any point of works In addition, the strategic plan has to be supported by sufficient capital VILC has already been approved to increase its capital in the end of 2012 It is a good signal for VILC to develop in the future 5.2.3 Str uctur e: Organizational structure defines the lines of authority and communication Structure can vary in the degree of centralization and formality of communication channels Since new service can utilize the synergies of current VILC structure, this study suggests that the company should maintain the centralized organizational structure This will maximize the scale and synergies across the company 5.2.4 System: Management system can all influence the strategy implementation This study considers fours elements of management system that has strong affection the result of strategy implementation: Communication system, Information system, Operation system, and Measurement and rewarding system 78 the company’s employee should have the same point of view about its vision, mission and strategy that they will corporate mutually to achieve the same goals Thus, it is necessary to deliver the strong messages about the company’s goals, objectives and especially strategic plan to all employees to ensure that they bear in mind those messages in working should be built based on information system strategy which added new services for customers to reduce time and cost Besides, information system has to be improved and updated flexibly appropriate to customer’s needs these are policies, procedures, information and controls needed to implement the strategy VILC simplifies its procedure through cut down unimportant stage Besides, the company is flexible in their policies, transparent in information and effective in their controls These works will optimize their operating system that attracts more customers to VILC in the future VILC has to build a clear appraisal system for both marketing department and back office departments Hence, the company has proper reward policies with that result which motivates and encourage employee to devote themselves for mutual goals 5.2.5 Cultur e: As VILC’s vision, the company continuously pursue reliable from their customer so reliability is built as company’s culture base on four core value: passion, communication, faith and creativity 79 Vietnam economy in particular and global economy in general currently faces some difficulties and challenges in development however it also creates opportunities for the company who is initiative in its business The main intension throughout this study is how VILC can overcome this difficult period and can improve its position in financial lease market under the stagnant economic By taking a review and understanding well the external environmental factors and the internal factors impacts to VILC business, this study recommends the strategies that VILC can implement to better compete against competitors, to gain more market share and to improve its position in financial lease market In Corporate level strategy, this study recommends the company should achieve growth by Horizontal integrate strategy through establishing a branch in Ha Noi and penetrating in Japanese enterprises market In addition, VILC should pursue Diversification strategy by opening loans services to customers which brings a cluster of services to customers In Business level strategy, it is recommended that the company should select Differentiation strategy and Focus strategy to earn more loyalty from existing customers as well as to expand their market to Japanese market segment In regard to Differentiation strategy, the study suggests VILC to focus on four important areas: marketing and sales activities, Inbound logistics activities (or credit appraisal activities), Operation activities (or Portfolio activities) and Service activities The marketing and sales activities help VILC to build up their image to target customers and to figure out the best way to approach them Inbound logistics activities focus on financial consultant for customers, reducing procedure of credit approval to meet promptly their customer’s needs and flexibility in pricing condition In addition, operation activities also focus on handling and satisfying promptly customer’s need in purchasing stage Lastly, service activities should enhance the communication channel between VILC and their customers 80 In Focus strategy, the study recommends that VILC should focus on the Differentiation focused segment as Japanese, Korean segment and potential recommended industries (Pharmaceutical, Medical, Foodstuffs industries) This can be done by differentiating itself in activities above If the company can implement this strategy successfully, this market may become niche market However, the focus strategy will not work with the company, and it may bring big loss or market share shrink accordingly if the company assumes wrong forecasts in the industry The recommended differentiation strategy can help VILC to improve their position and to extend their business However, the competitors might imitate these strategies which restrict the company’s competitiveness so it really necessary to have annual review and evaluation of strategy In order to maintain the sustainability of differentiation, VILC needs to: lower costs to generate differentiation, increase barriers to target segments, and increase switching costs to keep existing customers 81 Business monitor, Vietnam business forecast report, Q2 2011 Bob De Wit and Ron Mayer, (2005), Strategy Synthesis: Resolving Strategy Paradoxes to Create Competitive Advantage Harvard Business Review, November, December 1996, What is strategy? by Michael E Porter Harvard Business Review, January 2008, The Five Competitive Forces That Shape Strategy by Michael E Porter Harvard Business Review, November, December 1996, Building your company’s vision by James C Collin and Jerry I Porras Harvard Business Review, July-August 1985, How information give you competitive advantage by Michael E porter and Victor E Millar Michael E Porter, (1980), Competitive Strategy: Techniques for analyzing industries and competitors Michael E Porter, (1985),Competitive Advantage: Creating and Sustaining Superior Performance MIT Sloan Management Review, 2002, Building competitive advantage through people 10 Vinacapital economic report 11 Website: www.quickmba.com 12 Website: www.netmba.com 13 Phan Th Y n (2007), Phát tri n th tr ng cho thuê tài t i Vi t Nam 14 Truong Van Lien (2011), Analysis to build a competitive strategy for Korean air cargo in Hochiminh until 2016 15 TS Le Xuan Nghia (01/2012), Kinh t Vi t Nam giai đo n 2006-2011 tri n v ng 2012-2015 16 TS Hà Nam Khánh Giao, (2004), Qu n tr chi n l c công ty 1&2, NXB Th ng kê 82 Customer name:…………………………………… Person in charge: ………………………… Position: ………………………… Date: Dear Customers, We would like to appreciate your fulfilment survey below which is served as a data collection for an MBA program from Solvay Business School and HCMC Open University The survey is to measure the service quality and satisfaction of VILC offered to customers Criteria VILC price level in comparison with competitors Very high High Acceptable Low Very low Please recommend which are the lowest competitive conditions (Security deposit, Down payment, Interest rate, residual value) in VILC pricing: ………………………………… Question 2: Criteria On-time performance Credit appraisal processing (procedure of appraisal, documents, ect) Portfolio processing (sales contract, payment to supplier, insurance, other needs of customers Excellent Good Satisfactory Fair Poor 83 Invoice processing (ontime, error free invoicing, …) Value added services ( consulting services, supported documents… Criteria Monthly meeting with customers Always Often Sometimes Rarely Never Very often Often Sometimes Rarely Never Fine Improved Supporting to customers' need Method Bank loans Financial lease Finance company Operating lease Criteria On-time performance Pricing condition Credit procedure Portfolio procedure Customer services Thank you for your kind support Best regards, Details of improvement 84 Survey request sent: 60 Reply received: 60 Criteria Very high VILC price level in comparison with competitors High Acceptable Low 16 37 Very low Total 60 Please recommend which are the lowest competitive conditions (Security deposit, Down payment, Interest rate, residual value) in VILC pricing: Criteria VILC price level in comparison with competitors Criteria On-time performance Credit appraisal processing (procedure of appraisal, documents, ect) Portfolio processing (sales contract, payment to supplier, insurance, other needs of customers Invoice processing (ontime, error free invoicing, …) Value added services ( consulting services, supported documents… Security deposit Down payment Interest rate Residual value Total 32 10 13 60 Excellent Poor Total 60 Good 11 Satisfactory 30 Fair 18 29 23 30 26 35 25 60 28 32 60 60 60 85 Criteria Monthly meeting with customers Always Supporting to customers' need Method Bank loans Financial lease Finance company Operating lease Criteria On-time performance Pricing condition Credit procedure Portfolio procedure Customer services Very often 11 Often Sometimes Rarely Never Total 11 42 60 25 32 Often Sometimes 21 32 28 19 Fine 12 15 22 Improved 48 45 38 13 47 14 46 Rarely 37 12 60 Never Total 19 42 60 60 60 60 Details of improvement Security deposit, interest rate Documents, time Time, flexible in terms in sales contract, corrected Invoice, confirmation of outstanding, consulting