VITECO COMPANY AND ITS IMPORT OPERATION EFFICIENCY

In this part, author focus on introducing the establishment and organization of Viteco Company from the beginning to present. 1.1.1 Overview of Viteco - Trading name VITECO VIETNAM TELECOMUNICATIONS TECHNOLOGY JOINT STOCK COMPANY - Abbreviation name VITECO VNPT.,JSC - Head office No. 35/61 Lac Trung, Hai Ba Trung, Ha Noi + Tel (84.4) 3 8622727 + Fax (84.4) 3 6360023 + Website www.viteco.vn Founded in 1991, Viteco Company specializes in supplying, installing, repairing and producing the telecommunication equipments and electronics proponents.Viteco’s effort in that period played an important role in completing the company’s plan in 1991-1995. From 1996-2000, Viteco had succeeded in supplying 100 per cent of the switchboard in district, strengthening and improving the quality, maintaining the network equipments to improve its quality and service.

Lê Nhân Ngọc- CQ503754- Business English 50B CHAPTER I: INTRODUCTION OF VITECO COMPANY AND ITS IMPORT OPERATION EFFICIENCY 1.1 Introduction of Viteco Company In this part, author focus on introducing the establishment and organization of Viteco Company from the beginning to present 1.1.1 Overview of Viteco - Trading name VITECO VIETNAM TELECOMUNICATIONS TECHNOLOGY JOINT STOCK COMPANY - Abbreviation name - Head office + Tel + Fax + Website VITECO VNPT.,JSC No 35/61 Lac Trung, Hai Ba Trung, Ha Noi (84.4) 8622727 (84.4) 6360023 www.viteco.vn Founded in 1991, Viteco Company specializes in supplying, installing, repairing and producing the telecommunication equipments and electronics proponents.Viteco’s effort in that period played an important role in completing the company’s plan in 19911995 From 1996-2000, Viteco had succeeded in supplying 100 per cent of the switchboard in district, strengthening and improving the quality, maintaining the network equipments to improve its quality and service In 2006, the company changed to business by equitization form, the economic growth in 2008 increased 30 % compared to 2007 At that time, Viteco focused on cooperating with famous partners like Motorola, Ericsson, etc Up to now, the company has 170 employees and more than 80 per cent of total workers had university degree and 10 per cent of them studied in abroad With more than 20 years experience, Viteco reached trust from customers and partners, as well as its reputation has been increasing more Lê Nhân Ngọc- CQ503754- Business English 50B The organizational structure Viteco’s management structure includes shareholders, board, directors They are all controlled by supervisors The following offices are finance and accounting, administration, business plan, import-export and technology office Beside, there are some branches They are all described by the below diagram 1.1.2 General meeting of Shareholders Supervisors Board Directors Financial - accounting department Telecommunication centre branch Administrative department IT research, produce and apply centre branch Business plan department Design consulting and peripheral networks installation branch Import-export department Technological service centre branch Technological department South branch in Ho Chi Minh City Chart 1: Viteco organizational structure Lê Nhân Ngọc- CQ503754- Business English 50B General meeting of shareholders is the highest power in the company It decides to reorganize and dissolve the company, as well as developing plan, dismissing or assigning members of board, supervisors Board is the highest one in the management It has enough power to decide problems related to the goal and profit of company, except for works of shareholders’ authority Directors include general director and deputy of director General Director is on behalf of company doing business everyday They are all voted or dismissed by the general meeting of shareholders Supervisors are voted by Shareholders They control all operation of business, management of company ◊ Financial- accounting department: Advises the leadership, manage and support departments in the company on issues related to the accounting and statistics to ensure cost accounting in the company ◊ Business plan department: Advises the leadership, manage and support departments in the company to ensure goal for the production, business ◊ Technological department: Researches and applies informational technology, supervising service’s quality and products of company, managed by leadership ◊ Import-export department: does business directly, gains revenue for company, takes over consulting tasks, manages and supports the production for company ◊ Administrative department: supports in human resources, salary, political system ◊ Branches: supply telecommunication services, economical benefit, finance to implement plan and target of company Lê Nhân Ngọc- CQ503754- Business English 50B 1.2 Introduction of its business operation Business operation of Viteco includes business areas, some services, customers as well as partners 1.2.1 Viteco is one member of VNPT Vietnam Posts and Telecommunications Group is a state enterprise which specializes in investing, producing or doing business in posts and telecommunication in Vietnam Ranking to the fifth businesses among 500 highest enterprises in Vietnam, VNPT has been the biggest one in posts - telecommunications in Vietnam Viteco is one of some parts of VNPT implementing the commission import service Up to present, it has been making up large market in this manner 1.2.2 Business areas The company does business in the field of installing, repairing, producing and ensuring, importing the electronics components, telecommunications equipments For example: ◊ Producing and assembling telecommunications equipment, electric, electronics, information technology, combustion engine and refrigeration equipments ◊ Installing, repairing, and ensuring some switchboards such as STAREXIMS, STAREX-SRX, STAREX-APR ◊ Producing, purchasing and selling smart cards and applied card products (SIM/GSM, Master Card) ◊ Importing-exporting commodities company trading, especially the commission import service ◊ Supervising construction, installing equipments, network information technology, telecommunications Lê Nhân Ngọc- CQ503754- Business English 50B 1.2.3 Services, customers and partners 1.2.3.1 Services Huge customers using commission import service of Viteco involve both domestic and international countries like Vinaphone, VNPT, VTN, Alcatel, Motorola, Ericsson, etc In recent years, this form has brought great profits for company, especially with 3G service, Viteco becomes the head enterprise in VNPT doing this kind well Sponsored by Japan government, design consulting service succeeded in consulting solutions to incorporate the most advanced achievements telecommunications in world and Vietnam's telecommunications network conditions 1.2.3.2 Customers and partners Customers of Viteco are almost in all provinces, city in Vietnam which using network telecommunications and company’s services: Hanoi, Yen Bai, Thai Nguyen, Quang Ninh, Tuyen Quang and some other foreign customers like Huawei, Motorola, Ericsson, ZTE Up to now, Viteco has good relationship with more than 14 famous enterprises in the world such as: NEC (Japan), Siemens (Germany), LG (Korea), Ericsson, Motorola, Utstarcom (USA), Argus (Canada), Accu (Korea, China) Above is the common introduction of Viteco Company including establishment, organizational structure, business areas, services, customers and partners In chapter 2, general terms used in import operation will be defined In addition, there are also some factors that affect on company’s import operation CHAPTER 2: THEORETICAL FRAMEWORK Lê Nhân Ngọc- CQ503754- Business English 50B 2.1 Import theory This part will solve import theory involving its definition, characteristics, roles and types 2.1.1 Definition of import The word "import" is derived from the word "port," since goods are often shipped via boat to foreign countries Countries are most likely to import goods that domestic industries cannot produce as efficiently or cheaply, but may also import raw materials or commodities that are not available within its borders (http://www.investopedia.com/terms/i/import.asp#axzz1q8h3OSS2) "Imports" consist of transactions in goods and services (sales, barter, gifts or grants) from non-residents (residents) to residents (Lequiller, F; Blades, D Understanding National Accounts, Paris: OECD 2006, pp 139-143) The exact definition of imports in national accounts includes and excludes specific "borderline" cases A general delimitation of imports in national accounts is given below: An import of goods occurs when there is a change of ownership from a nonresident to a resident; this does not necessarily imply that the good in question physically crosses the frontier However, in specific cases national accounts impute changes of ownership even though in legal terms no change of ownership takes place Also smuggled goods must be included in the import measurement Imports of services consist of all services rendered by non-residents to residents In national accounts any direct purchases by residents outside the economic territory of a country are recorded as imports of services; therefore all expenditure by tourists in the economic territory of another country are considered as part of the imports of services Also international flows of illegal services must be included Lê Nhân Ngọc- CQ503754- Business English 50B 2.1.2 Basic characteristics of import Import is a complicated operation compared to domestic business It has some features as follows: ◊ Adjusted by laws like international agreement on foreign trade, national laws, etc ◊ Diversifying trading systems on international market: normal trade, mediated transactions, or transactions in festivals, exhibitions ◊ Various payment methods: L/C, T/T, exchanging goods ◊ Importing by CIF, COB, etc conditions ◊ Currencies used in transactions are: USD, EURO… ◊ Buying insurances in terms of risks ◊ Large area, complex formality, long time for completing Import operation is one chance for businesses in different countries cooperating International trade has a direct effect on economic relations - politics of the exporting country, contributing to economic development and external relations 2.1.3 Roles of import Import expresses close mutual relations between the country’s economy and the world one However, its characteristics and its goal are different in each time In fact, after joining the international economy, import operation is becoming more and more significant ◊ Contributing to bring modern technologies from world to country, plays roles in eliminating monopoly, and improves economic result ◊ Creating leading goods for company, department and meeting domestic customers demands ◊ Diversifying business operations and commercial goods, and then improving quality of those companies Lê Nhân Ngọc- CQ503754- Business English 50B ◊ Pushing up technique transportation which helps save time, money and leading to the development of national production ◊ Creating competitions among domestic companies and international ones 2.1.4 Types of import There are two main types of import They are direct import and commission import 2.1.4.1 Direct import Direct imports are products imported directly into a country and not through the manufacturer's authorized agent/distributor Since there is no factory-authorized middleman involved in the import of these products, the added costs are lower and the customer pays less In addition, many items that are in short supply or are not imported at all by the manufacturer's authorized distributors can be procured as direct import There is no difference in the actual products In most cases, they are manufactured in the same place by the same people and with the same materials Occasionally, manufacturers will give them a different name This method may contain more risks but it also brings bigger profits for companies than other types 2.1.4.2 Commission import (entrust import) Commission import is implemented by a domestic business having own foreign currency wants to import materials but not have abilities Consequently, they entrust other company to finish that procedures Then, receiving entrusted businesses work with foreign partners to make import proceedings according to entrust businesses’ requirements Finally, they will accept remuneration called “entrust fees” In this model, importers not need to import formalities, moreover, beginning capital is also not too much Nevertheless, those businesses can not be active about time, place, and procedures 10 Lê Nhân Ngọc- CQ503754- Business English 50B In addition, there is one type of import is import barter or import convection It was used by some undeveloped countries but now, this form is not applied in international trade 2.1.5 Import procedures Import trade refers to the purchase of goods from a foreign country The procedure for import trade differs from country to country depending upon the import policy, the statutory requirements and customs of different countries In almost all the countries of the world import trade is controlled by the Government The objectives of these controls are proper use of foreign exchange, restrictions on imports of non-essential and luxury goods, development of indigenous industries, etc It includes 11 steps as follow: ◊ Seller and Buyer conclude a sales contract, with method of payment usually by letter of credit (documentary credit) ◊ Buyer applies to his issuing bank, usually in Buyer's country, for letter of credit in favor of Seller (beneficiary) ◊ Issuing bank requests another bank, usually a correspondent bank in Seller's country, to advice, and usually to confirm, the credit ◊ Advising bank, usually in Seller's country, forwards letter of credit to Seller informing about the terms and conditions of credit ◊ If credit terms and conditions conform to sales contract, Seller prepares goods and documentation, and arranges delivery of goods to carrier ◊ Seller presents documents evidencing the shipment and draft (bill of exchange) to paying, accepting or negotiating bank named in the credit (the advising bank usually), or any bank willing to negotiate under the terms of credit 11 Lê Nhân Ngọc- CQ503754- Business English 50B ◊ Bank examines the documents and draft for compliance with credit terms If complied with, bank will pay, accept or negotiate ◊ Bank, if other than the issuing bank, sends the documents and draft to the issuing bank ◊ Bank examines the documents and draft for compliance with credit terms If complied with, Seller's draft is honored ◊ Documents release to Buyer after payment or on other terms agreed between the bank and Buyer ◊ Buyer surrenders bill of lading to carrier (in case of ocean freight) in exchange for the goods or the delivery order (Source: Airlinklebanon.com/international trade) 2.1.5 International commercial terms The Incoterms (International Commercial Terms) is a universally recognized set of trade terms brought out by the International Chamber of Commerce (ICC) in Paris They clearly define the buyer and seller’s trade contract liabilities and are considered to be a cost-saving tool They are used throughout the world and are accepted by banks, customs authorities, all types of carriers, transportation intermediaries and financial institutions The Incoterms were first published in 1936 and have been regularly updated following the changes in the international trade needs, till their latest version in 2002 The International trade terms are grouped in four categories: E, F, C and D, each one indicated by the first letter of the acronym Below is a list of the most common Incoterms: EX- WORKS (From factory or warehouse): 12 Lê Nhân Ngọc- CQ503754- Business English 50B management is giving shareholders more for their money On the other hand, if ROA is low or the company is carrying a lot of debt, a high ROE can give investors a false impression about the company's fortunes Table below will show the ROA and ROE of Viteco: Shareholders’ equity Total assets Net income ROA ROE 2008 15.000.000.000 2009 15.612.440.000 2010 15.612.440.000 147.349.712.507 2.843.737.265 0.02 0.19 116.584.939.179 3.323.053.099 0.03 0.21 87.291.894.984 3.566.460.000 0.03 0.23 Currency: Vietnam Dong Table 3: ROA and ROE of Viteco in 2008-2010 (Source: Annual financial report of Viteco) According to these figures, readers can see that ROA of the company is quite stable from 2008 to 2010 at 0.03 However, in comparison with other businesses in Vietnam which the same field with Viteco, this rate is much lower than other one Taking an example, Petrolimex import-export Company gained 4.7 % or Intimex reached 14.4 % in 2010 The same to ROA, although ROE of Viteco increases from 2008-2010, it is lower than competitors ROE of Petrolimex is 7.5% and Intimex is 17.89% in 2010 From the figures, people can know that Viteco was not still good at generating earnings and using their assets suitably 3.1.4 Total asset turnover ratio Below is the statistic of total asset turnover ratio of Viteco Company: 22 Lê Nhân Ngọc- CQ503754- Business English 50B Revenue Total assets TAT 2008 58.506.557.082 147.349.712.507 0.4 2009 88.797.835.681 116.584.939.179 0.76 2010 140.818.014.349 87.291.894.984 1.61 Currency: Vietnam Dong Table 4: TAT of Viteco in 2008-2010 (Source: Annual financial report of Viteco) From statistics of table 4, although TAT ratio is still low, it has signs of increasing This fact proves that Viteco has been more effective in the use of the investments made in the company Hoping the results will be improved in the following years 3.2 Factors affect Viteco’s import operation In order to make import operation work well, each company is aware of factors that affect on import operation in their companies They include exchange rate, capital and technology, human resources and politics 3.2.1 External factors There are many external factors that affect on the import operation of the company However, the author just focus on the exchange rate and the politics 3.2.1.1 Exchange rate 23 Lê Nhân Ngọc- CQ503754- Business English 50B It can not be denied that exchange rate between Vietnam Dong and USD has influences in doing business as well as import operation of the company This rate is inversely proportional to the profit of the Company It means that if the rate is elevated, businesses have to pay the higher expenditures for the imported goods, and vice versa 20000 19000 18000 17000 16000 15000 08/Jan Apr Jul Oct 09/Jan Apr Jul Oct 10/Jan Apr Jul Oct Chart : Evolution of exchange rate between Vietnam Dong and USD from 2008-2010 (Source: SBV) Due to the global crisis, the inter-bank exchange rate in 2008 was very low, just nearly 16000 to 17000 This is also the year in which Viteco suffered from the lower revenue (58.5 billions) And then, this rate increases gradually, reaching the top at October, 2010 (more than 19000) Hence, in 2010, Viteco gained revenue as much more twice as 2008 3.2.1.2 Politics The domestic and foreign policies have impact on import activities of the company in general and Viteco Company in particular The differences among countries will also 24 Lê Nhân Ngọc- CQ503754- Business English 50B affect on import activities Being aware that the political environment in which the firm operates will have a significant impact on a company's international marketing activities When doing business abroad, Viteco is conscious the fact that what they could be the object of some political action Hence, they recognize that their success or failure depend on how well they cope with political decisions, and how well they anticipate changes in political attitudes and policies Vietnam has stable political environment and favorable economic policy, so they facilitate Viteco’s import operation 3.2.1.3 Transportation and communication system People know that the transportation system of Viet Nam is very terrible; anyone can see the image of crowded people in the rush hours In fact, although the government as well as related organization has given many solutions to it, the situation has been continuing 3.2.2 Internal factors In this analysis, factors are mentioned including capital, technology, and human resources 3.2.2.1 Capital and technology With huge amount of capital (more than 15 billions), company operated business well and gained considerable successes; since then, Viteco has been increasing its bonds rate which push up company’s capital Moreover, Viteco has many modern and updated models in the field of telecommunication which serve for installing, repairing services Therefore, contracts will be implemented from other companies 3.2.2.2 Human resources 25 Lê Nhân Ngọc- CQ503754- Business English 50B More than 80 per cent of employees are educated from universities, including more than 10 per cent studied in abroad They are all aware of technology, telecommunication as well as import-export Established for long time, Viteco has good staff with 20 years of experience Besides, the company has also young and active staff, they bring new atmosphere to all members These factors contribute to the achievement of Viteco Company in operation 3.3 Strengths and weaknesses After analyzing data and factors related to Viteco, we can find out its strengths as well as its weaknesses 3.3.1 Strengths To properly evaluate the effectiveness of import operation of the company, achievements must be unmentioned From the financial report, we can see that Viteco’s revenue has been improving and short term debt has reduced These successes are gained by efforts from all members of Viteco’s staff It is fully encouraged The Company’s staff is well-educated; they are responsible for their task and contribute to the success of the company Moreover, the market share of the company is very large, in almost provinces and cities in Vietnam So, it make easier for the company to have longer and closer relationship with customers In the field of import- export, Viteco succeeds in improving commission importexport service, the heading company which does this way in VNPT Therefore, Viteco will gain more customers and reduce amount of competitors 3.3.2 Weaknesses 26 Lê Nhân Ngọc- CQ503754- Business English 50B Beside the achievements, we must mention the weaknesses of the company; since then, the author will suggest solutions for these problems It cannot be denied that advertisements play an important role in doing business of any companies Although this task is quite boring and waste time, it brings good effect on updating customers the companies’ information Whereas, Viteco has rarely focused on promotion measures such as: advertising in websites, TV, or magazines This prevents customers from being aware of the products’ information Especially, there are many competitors who doing business with the same field of the company So, even if consumers know about the products, they may not purchase if they are not familiar with them Being an agency of VNPT, the famous business in Vietnam, brings great advantages for Viteco However, this company does not the only one member of VNPT Beside Viteco, VNPT has many agencies in both South and North provinces in Vietnam like: SACOM, VTC telecom, KASATI, Post and Telecommunication Equipment Joint Stock Company (POSTEF), etc Consequently, it makes difficult for the company to gain large market share because of huge competitors Import- export field in this company has not been improved much, Viteco just focused on commission import measure, not the direct one Therefore, it prevents business from being active in working, and of course, the profit will be lower Moreover, it takes time to finish these contracts Like other import- export enterprises, Viteco tends to apply CIP, Icoterms 2000 in importing equipments They thought that the CIP is safer than other one, because the exporter is responsible for arranging and paying all costs for the transportation including insurance of the goods up to the agreed point in the named port of destination However, the importer bears all costs and risks of loss or damage from the point of delivery The company did not also follow well the procedures of import, so it leaded to the overlaps when importing goods from the international countries and wasting so much time to finish These limitations need changing Chapter focuses on analyzing the performance of the company in 2008-2010, the factors that affect import operation Then, it figures out strengths and weaknesses 27 Lê Nhân Ngọc- CQ503754- Business English 50B Basing on these results, the author suggests some recommendations to improve the import operation of Viteco Company CHAPTER 4: RECOMMENDATIONS TO IMPROVE IMPORT OPERATION EFFICIENCY The complexity of moving commerce in a safe, quick, efficient, and compliant manner is frequently overlooked The processes behind importing often cause confusion and frustration for all parties involved, resulting in costly delays at international borders It is imperative for companies to stay on top of new security developments as they arise; failing to so can mean a loss of valuable time, revenue, and, ultimately, customers So, one business wants to improve, it should pay attention to the capital, import measure, marketing strategies, staff, etc 4.1 Recommendations for the company One business wants to work well; it needs pay attention to many things and be careful to make decision Below are some recommendations for Viteco Company to enhance import operation efficiency 4.1.1 Setting up the advertisement and marketing department Although Viteco was established for long time, there are now many companies which business with the same field of Viteco Therefore, marketing strategies is significant to improve the company The marketing department is responsible for researching market, conducting surveys to meet customers’ demands, advertising to promote images of the company Then, the company rekindles relationship with the customers Although marketing and 28 Lê Nhân Ngọc- CQ503754- Business English 50B advertising are important to get more customers, quality, service and customer satisfaction are what keep a business successful in the long run To introduce products and services into the market and create value in the mind of the customers, the marketing department needs to market researches Basing on the results, the managers can make decisions for marketing and competitive activities Most marketing planning and budgeting activities tend to be manual, iterative exercises The final plans are hidden behind mountains of spreadsheets and documents that are not visible to most stakeholders until the last minute This results in constant and unnecessary urgencies and causes wasteful crisis-driven operations 4.1.2 Raising the capital of the company If one business desires to gain success, it should find out measures to push up company’s capital, because the capital is used to start or maintain business Especially, the import operations need so many capitals, because the demands are so high Therefore, the company should issue bonds to raise capital for finance expansion A bond is a written promise to pay back a specific amount of money at a certain date or dates in the future In the interim, bondholders receive interest payments at fixed rates on specified dates Holders can sell bonds to someone else before they are due Corporations benefit by issuing bonds because the interest rates they must pay investors are generally lower than rates for most other types of borrowing and because interest paid on bonds is considered to be a tax-deductible business expense However, corporations must make interest payments even when they are not showing profits If investors doubt a company's ability to meet its interest obligations, they either will refuse to buy its bonds or will demand a higher rate of interest to compensate them for their increased risk For this reason, Viteco can seldom raise much capital by issuing bonds Besides, the company can also raise short-term capital, usually to finance inventories, by getting loans from banks or other lenders One more method, the company can use its profits As noted, Viteco can also finance their operations by retaining their earnings Strategies concerning retained earnings vary Some corporations, especially electric, gas, and other utilities, pay out 29 Lê Nhân Ngọc- CQ503754- Business English 50B most of their profits as dividends to their stockholders Others distribute, say, 50 percent of earnings to shareholders in dividends, keeping the rest to pay for operations and expansion Still other corporations, often the smaller ones, prefer to reinvest most or all of their net income in research and expansion, hoping to reward investors by rapidly increasing the value of their shares 4.1.3 Training the qualities of the company’s import-export department Firstly, when choosing one attitude, the HR managers should select employees with good qualifications which suitable with the import-export field Taking an example, an import-export branch must have good knowledge of international trading and transportations, they are fluent in speaking, writing, and listening English to work with foreign companies Secondly, the company should choose some good members to go abroad to learn experiences of international companies, they will know exactly what they do, how they work to make efficiency Employee development training is one of the important ways to ensure the organization to have the capacity to deliver on its promise to customers for long term In addition, motivation is the key to performance improvement The managers should pay more attention to the life of employees The company should prepare some outdoor activities like travels, parties, or awards for the good employees monthly and annually Besides, the managers can challenge them by using report boards to show employees the numbers, letting them see how they stack up against others in key performance indicators, teaching employees how to set goals This can apply to company, department and individual goals Make sure the goals are S.M.A.R.T.: specific, measurable, achievable, realistic, and timely 4.1.4 Finishing the import operation 30 Lê Nhân Ngọc- CQ503754- Business English 50B In import procedures, there are many steps; the company should follow the process of import as said in chapter to avoid risks and wasting time because of overlaps in working In order to complete this task, all members of the staffs must learn and know much about it and practice more times, then they will it by their habits 4.1.4.1 Negotiation and signing In this step, Viteco as well as other companies in Viet Nam is weaker than international competitors because of lack knowledge and information In order to overcome this difficulty, the company needs update the information to capture the business situation of electronics materials in the world, and then Viteco will set out the strategic initiative in the negotiations Before negotiating, the company needs: ◊ Identifying the specific circumstances as well as the negotiation participants with foreign partners ◊ Participants in the negotiations must be people who have experienced and complete knowledge of foreign trade, foreign languages and law They must also have good communication skills, dynamic and agile in handling the situation Before negotiating, psychology need be comfortable to achieve high efficiency in the results ◊ Clarifying the goal to bring the benefits of negotiations for the company There should be alternative options to change flexibility and gain the initiative in the negotiations ◊ Researching the financial position of the partners in the market carefully, since it will grasp the strengths and weaknesses of the enemy In implementing negotiation, people should use some ways skillfully: ◊ Informing competitors are not the single partner of the company ◊ Finishing the strategies gradually, not be angry and hurry ◊ Not expressing his thoughts, just observing the opponent's attitude ◊ Not using arbitrary language, it must be prepared to take the initiative 31 Lê Nhân Ngọc- CQ503754- Business English 50B ◊ Avoiding the agreement happened so quickly, it makes the enemy feel uncertain and worried 4.1.4.2 Implementing contracts Although the process of negotiation was prepared carefully, the stage of contract performance also encountered many difficulties, so the company needs find the cause and suggest solutions ◊ The customs task: customs procedures are relatively complex with many types of documents and various papers that the company shall declare tax calculation and application of codes, so that the mistake occurs likely Consequently, Viteco should election officials with knowledge of the foreign trade, law, foreign languages, especially the texts of the General Department of Customs After completing the inspection of goods and business tax, officials should copy a customs declaration for finance and accounting office to monitor and coordinate the timely payment of taxes and customs fees The company also needs to understand the procedures and conducted steps to be flexible, avoid wasting time and unnecessary money ◊ Delivery and transport: The Company often hires transport services It also cost much money, so Viteco should consider itself delivering or receiving goods to save costs and reduce production costs If in the case of rental delivery service, the company should base on commission contracts as well as customers’ order to prepare a paper and have delivery plans ◊ Payment: During the process of importing goods, the use of foreign currency can not be avoided Sometimes, due to influences of the economy in general, the foreign currency resources is scarce, so the company needs reserve a necessary amount of foreign currency for the payment process Therefore, 32 Lê Nhân Ngọc- CQ503754- Business English 50B the local currency needs collecting from customers to convert into foreign currency when needed The company should use credit payment methods to ensure safety and only use form of payment T / T in some necessary and believable cases As mentioned in chapter 3, Viteco used CIP in importing goods, but this might bring many risks for the company So, in order to make better effect, it should use term FCA or EXW, because with these terms, Viteco will gain many advantages as well as insurances With EXW method, the exporter fulfils his obligation to deliver when he has made the goods available at his premises (i.e works, factory, warehouse, etc) to Viteco In particular, he is not responsible for loading the goods on the vehicle provided by the buyer or for clearing the goods for export, unless otherwise agreed The buyer bears all costs and risks involved in taking the goods from the seller's premises to the desired destination This term thus represents the minimum obligation for the seller With the FCA one, Viteco is responsible for the contract of carriage and insurance The seller must obtain his own risk and expenses any export license or other official authorization and carry out all customs formalities necessary for the goods export 4.2 Recommendations for the government In order to gain success in import operation, the company needs cooperation and support from related agencies, state departments, because the company is an entity in economy, impacted by political , legal, social factors, particularly the legal environment has a direct impact on the import operation of the company's technological products 4.2.1 Capital The State should cross out regulations of credit limits for commercial banks to encourage imports The government should also be oriented to direct the banks to stand guarantee for the enterprises borrowing large sums from the international credit 33 Lê Nhân Ngọc- CQ503754- Business English 50B institutions with preferential interest rates or from the international manufacturers by deferred L / C form As for Vietnam market information is very limited, inundated, and it also lacks the precision, therefore, it is so difficult to understand foreign markets and partners correctly So, in the next time, the state officials as well as related sectors should focus on researching, controlling and forecasting the global market, creating opportunities for the technology companies to explore market Besides, the state should also create an environment of fair competition among economic sectors; pay more attention to the process of equitization of State enterprises to demonstrate the dynamism and efficiency, in line with the development of the market 4.2.2 Customs tasks General Administration of Customs has the specific and uniformed guidelines for each commodity, so it can help the Viteco Company as well as other ones work well in the business process and post-inspection of the tax The customs department should facilitate flexibly to help companies complete the procedure and receive goods as soon as possible Customs inspectors should constantly inspect and urge the customs officials to avoid wasting materials and time for business 4.2.3 Tax policy General Department of Taxation directs the local tax department to help units tax refund faster General Department allows companies to business more efficiently Moreover, that department should have unique and detail code of import tax for each item to facilitate the company completed the import process To implement the above recommendations, lawmakers need consider carefully the law of Vietnam converted in accordance with international practice and then build unified legal framework The legal documents which are before issued need consulting from other Ministries as well as qualified professionals They should avoid problems when there is a conflict among the equivalent authorities In chapter 4, some recommendations are promoted to help Viteco Company improve the import operation well 34 Lê Nhân Ngọc- CQ503754- Business English 50B CONCLUSION Each economical country which wants to regulate the process of integration into the region and the world will not be separated import and export activities In the national economy, import operation plays a very important role, because it expands the ability of the country consumption, diversifies products, creates incentives to develop domestic production Moreover, import would eliminate the state monopoly in the world, breaking the closed economy as well as create a balance to the economy and promote export To find out solutions for the development of Viteco Company in terms of import operation, the author has been applying the knowledge and awareness from university, and experiences in the real work, especially under the guidance of Mrs Pham Thi Quynh Hoa, M.A For the target of improving the import operation, the report has proposed some solutions Firstly, the company should enhance the capitalization by issuing bonds, stocks, etc Secondly, advertisements need pushing up to raise company’s prestige Thirdly, members of company’s staffs should also be trained more to ensure the quality of human resources Besides, improving the import-export operation is one of the most important tasks of this business Taking an example, the company can use FCA instead of CIP to avoid risk when transporting to Vietnam, Viteco’s members must also follow the import procedures Finally, the government should also change some things to gain effect from the import operation and contribute to the successes of the nation This report has remained some limitations and shortcomings The author is always looking forward to hearing the comments and guidance from professors and teachers 35 ... to the achievement of Viteco Company in operation 3.3 Strengths and weaknesses After analyzing data and factors related to Viteco, we can find out its strengths as well as its weaknesses 3.3.1... to improve the import operation of Viteco Company CHAPTER 4: RECOMMENDATIONS TO IMPROVE IMPORT OPERATION EFFICIENCY The complexity of moving commerce in a safe, quick, efficient, and compliant... and be careful to make decision Below are some recommendations for Viteco Company to enhance import operation efficiency 4.1.1 Setting up the advertisement and marketing department Although Viteco