PHÂN TÍCH SWOT về XUẤT KHẨU gạo vào THỊ TRƯỜNG SINGAPOREE

PHÂN TÍCH SWOT VỀ XUẤT KHẨU GẠO VÀO THỊ TRƯỜNG SINGAPORE TOPIC: RICE EXPORTATION TO SINGAPORE I/ COMPANY INTRODUCTION About Hung Lam Rice Company Full trading name: Hung Lam Joint Stock Company English name: Hung Lam Joint Stock Company Transaction name: Hung Lam Rice Abbreviation name: Hung Lam JSC Logo Slogan: High Quality - Safe - Useful – Friendly Legal representative: Mr Pham Hoang Lam – Chairman cum CEO Hung Lam Joint Stock Company was formerly known as Hung Lam Producing - Trading Service Company Limited Hung Lam Producing - Trading - Service Company Limited was set up by founding members of over 23 years of Rice experience with Business Registration No 1600891913 which was issued by Department of Planning & Investment of An Giang Province on 08/05/2007 (charter capital was VND 10 billion) Specializing in its main business sector, Hung Lam is not only a rice brand name but also a high-quality rice manufacturer in Vietnam With a modern and international-standard cleaning and packing assembly line, a factory of 10,000 m2 in area with over 12,000-ton storage capacity, skillful, active employees contribute to developing company firmly , for instance, Hung Lam rice is exported to many countries such as, Switzerland, the Philippines, Malaysia, etc To meet a demand of non-stoppable development, Hung Lam Producing - Trading – Service Company Limited changed its form to Joint Stock Company on November 19 th, 2009 in accordance with Business Registration No 1600891913 which was issued by Department of Planning & Investment of An Giang Province on 28/11/2009, with charter capital of VND 56,007,950,000.00 (Fifty six billion seven million nine hundred and fifty thousand dong /.) Currently, after the Meeting of Board of Directors on 07/04/2010, Board of Directors passed the Decision No 25/QD on: raising more capital (VND 14,543,110,000), increasing the Company’s charter capital from VND 56,007,950,000 to VND 70,551,060,000 to keep pace with the Company’s development Ensuring outputs and revenue growth every year, the Company takes the initiative in using capital, implementing projects to meet the demand of expanding export markets such as, investing in one more cleaning factory with model capacity of 170 tons/day which increases total capacity of factories to 306 tons/day, modern equipments to meet food safety standards of fastidious markets, i.e Europe, America, Africa, etc Product and achievement 2.1 Product Business lines Jasmine Rice Huong Lai Rice VD 20 Rice - Product information Average length: 6.8mm Broken: 5.0% Moisture: 14% Whole of grain: 65% - 70% Foreign matters: 1.5% Yellow kernels: 0.3% Damaged kernels: 0.2% Average length: 6.8mm Broken: 5.0% Moisture: 14% Whole of grain: 65% - 70% Foreign matters: 0.1% Yellow kernels: 0.1% Damaged kernels: 0.1% Average length: 5.8mm Broken: 10% Moisture: 14% Whole of grain: >= 55% Foreign matters: 1.0% Yellow kernels: 1.0% Image Japonica Rice 4900 Rice ST Rice Glutinous Rice White long grain rice Broken Rice 5% - Damaged kernels: 1.5% - Average length: 5.0mm Broken: 5.0% Moisture: 14% Whole of grain: 60% Foreign matters: 0.5% Yellow kernels: 1.0% Damaged kernels: 1.5% Average length: 6.8mm Broken: 5.0% Moisture: 14% Whole of grain: 65% - 70% Foreign matters: 0.1% Yellow kernels: 0.5% Damaged kernels: 0.5% Average length: 6.8mm Broken: 5.0% Moisture: 14% Whole of grain: 60% Foreign matters: 0.1% Yellow kernels: 0.1% Damaged kernels: 0.5% Average length: 5.5mm Broken: 0.0% Moisture: 14% Whole of grain: 70% Foreign matters: 0.1% Yellow kernels: 0.1% Damaged kernels: 1.0% Average length: 6.2mm Broken: 5.0% Moisture: 14% Whole of grain: >=60% Foreign matters: 0.1% Yellow kernels: 0.5% Damaged kernels: 1.0% - Average length: 6.2mm - Broken: 10% - Moisture: 14% Broken - Whole of grain: >=55% Rice 10% - Foreign matters: 0.1% - Yellow kernels: 1.0% - Damaged kernels: 1.5% - Average length: 6.2mm - Broken: 15% - Moisture: 14% Broken - Whole of grain: >=50% Rice 15% - Foreign matters: 0.2% - Yellow kernels: 1.25% - Damaged kernels: 1.5% - Average length: 6.2mm - Broken: 25% - Moisture: 14.5% Broken - Whole of grain: >=40% Rice 25% - Foreign matters: 0.5% - Yellow kernels: 1.5% - Damaged kernels: 2.0% - Average length: 3.2mm - Broken: 100% Broken - Moisture: 14% Rice - Whole of grain: 0.0% 100% - Foreign matters: 0.0% - Yellow kernels: 1.0% - Damaged kernels: 1.0% 2.2 Achievement and awards - Certificate of merit by People’s Committee of An Giang Province for excellent performance in business operation, contributing to economic-social development of its home province in 2010 and 2011 - Certificate of the General Department of Taxation for contributions to the state budget in 2010 Business situation Operating in husking, cleaning and exporting rice, in 2010, Hung Lam JSC improved its export markets and reached VND 200 billion in revenue, exceeding 67% Net profit after tax reached VND 3.2 billion; especially the Company had no overdue debt and was one of the enterprises who abides well with policy, and regulations of the Communist Party and the government Currently, company has a warehouse with 8,000-ton capacity to store endproducts, the modernist cleaning assembly line with 24 tons/hour capacity, and a colorsplitting assembly line in order to introduce Hung Lam Rice to all over the world The most remarkable event in 2011 was that Hung Lam JSC co-operated with Department of Agriculture and Rural Development of An Giang Province to take over 26ha Jasmine rice under Globe Gap’s standard in Tan Lap Commune, Tinh Bien District The biggest success of the Company was that we, ourselves, can exploit export markets in Europe, Asia such as, Norway, Denmark, Singapore, and Hong Kong so as to build Hung Lam rice brand-name and develop a series of specialty rice in such a sustainable manner Introduction about expected product to enter to Singapore Three product lines that Hung Lam Rice is expected to enter to Singapore market included: Jasmine rice, Huong Lai rice and glutinous rice These products are very preferred in the domestic market and now are gaining strength in the market that company has successfully exported such as: Sweden, Malaysia, the Philippines, etc In addition, through research study, these products can fully meet the needs and preferences of the Singapore people Why choosing Singapore Republic of Singapore is the smallest country in Southeast Asia, located in the south of Malaysia peninsular, in the south of Johor state of Malaysia and in the north of Indonesia’s Riau Islands Singapore is located just 137 km north of equator There are almost no natural resources here Raw materials must be imported outside Singapore has little coal, lead, lava, clay, and no fresh water Arable land is narrow, mainly for rubber plantation, coconut, vegetables and fruit, so the agricultural is not developed Yearly, the government must import food to meet domestic demand Singapore society is a multi-ethnic society, consisting of many different cultures, such as China, India, Malaysia It is an immigrant country, including the Asian community gains a huge proportion Eating habits and practices in ancient Asia, rice is the main dish of the meal (This is the same as in Vietnam) In addition, trade between Vietnam and Singapore is now well developed, flexible and extremely easy No tariffs because Singapore is one of the six countries have applied the tax rate = 0% from January 01st, 2010 About preferences, we can see the Singapore like rice from Vietnam so much According to recent reports which showed that the choice of Vietnamese rice for meals of Singapore instead of Thailand rice has become more popular Jasmine rice imported from Vietnam absorption doubled compared to October, 2011 By all the above reasons, it is possible that the rice exportation to Singapore is a potential choice for Hung Lam Rice This is also an opportunity for Hung Lam Rice to expand their market II/ SINGAPORE MARKET INTRODUCTION Economic conditions Singapore's economy is mainly based on trade and services (gains 40% of national income) Singapore got the highest economic growth rate in the world since the late 1980s: 10% in 1994, 8.9% in 1995 However, from the end of 1997, due to the impact of the currency crisis, the Singapore dollar has been devalued by 20%, and strong economic growth in 1998 down to 1.3% Since 1999, Singapore began to recover rapidly: in 1999, an increase of 5.5% and reached more than 9% in 2000 Due to the impact of the September 11 th event, the decline of the world economy and then the SARS outbreak, Singapore economy severely affected: in 2001, only -2.2% economic growths; in 2002 3% and 2003 was only 1.1% Since 2004, strong growth: 8.4% in 2004; 2005 was 5.7%; 2006 reached 7.7% and in 2007 7.5% In 2009, GDP increased by 1.2% due to the impact of the economic crisis Singapore is also considered a leader in transition to the knowledge economy Singapore is implementing the plan until 2018 to turn Singapore into a leading global city, a hub of the new network in the global economy and Asia and a diversified, business sensitive economy Infrastructure Singapore is the leading in the infrastructure and high developmental industry in Asia and the world such as: sea port, ship building and repair industry, refining industry, processing and assembly of sophisticated machinery Singapore is also the leader of manufacturer electronic computer drives and semiconductors Goods distribution Distribution and sales channels of Singapore are simply and directly Most consumer goods are imported by the distributor, and then they sell them to retailers Some goods imported directly for sale at retail stores and importers Relationship between Vietnam and Singapore Economic, trade and investment relation between two countries has developed rapidly Singapore is the leading trade partner of Vietnam, continuously two-way trade turnover growth, exceeding U.S $ billion in 2010 Singapore has invested more than 930 projects in Vietnam with a total registered capital of U.S $23 billion, ranking third among more than 90 countries investing in Vietnam Comprehensive bilateral relations developed in the fields of politics, culture, education, national defense, security and tourism There are approximately 100 flights per week between the two countries That is the vivid evidence for a very critical developing relation between the two countries III/ STRENGTH, WEAKNESS, OPPORTUNITIES AND THREATENS FOR VIETNAM WHEN ENTERING INTO SINGAPORE MARKET Strength 1.1 Supply - Hung Lam Rice supplies extremely abundant due to natural suitable conditions Headquarters and processing plant located in An Giang Province - the only province in Vietnam whose rice output reached 3.9 million tons in 2011 - Hung Lam Rice species are abundant Besides the types which are very popular in the market such as jasmine rice, Huong Lai rice, glutinous rice , Hung Lam Rice also add other special lines, such as Dragon Blood rice, 4900 rice, long grain white rice Rice categories meets the people ‘s diverse needs in the Mekong delta in particular and the country in general Furthermore, low cost, low and competitive production costs, abundant labor are also a strong point of Hung Lam Rice 1.2 Transportation - Hung Lam Rice is located in An Giang - one of the four provinces in key economic region of the Mekong Delta Mekong Delta is the gateway of trade with ASEAN countries such as Cambodia, Laos, Thailand, Myanmar, Malaysia, etc So the transportation is very convenient - Goods may be transferred to Singapore in many different ways such as shipping, airway.etc… 1.3 Government policy - The government supports for rice exportation business - Using the chart below, because of the support from the government, rice production has been increasing yearly Vietnam's rice exportation from 2005 to 2011 (unit: thousand tons) 1.4 The understanding of Vietnamese business market Based in An Giang, the largest granary of Vietnam is the strength of Hung Lam Rice The understanding of An Giang market, the relationship will help Hung Lam Rice has a positive negotiating for other input units in the country 1.5 Credibility of Hung Lam Rice in the market - As a leading enterprise in An Giang province in particular and Vietnam in general in rice supplying - From ensuring production and revenue growth each year, the enterprise has actively funding, implementing projects to meet the needs of expanding exportation markets such as: invest in a wipe - shadow factory with a design capacity of 170 tons raw material a day, bringing the total operating capacity of the plant to 306 tons raw material a day, with modern equipment to meet all the requirements of food hygiene and safety in difficult markets like Europe, America, Africa - Get many awards for effective business operation, dynamic enterprise… Weakness - In Vietnam, Hung Lam Rice is a strong brand, but it is just a new name in Singapore market - Rice production is also largely depended on natural factors (drought, flood, etc.) - The marketing activities are not really effective We have just stopped at new product introduction, have not mentioned to the difference points compared with other competitors in the market Opportunities - Importation tax on goods imported from Vietnam to Singapore is now applied 0% With this tariff Vietnam has the chance to compete with China and India Transportation costs decreases led to the price will be more competitive - Confirmed Vietnamese rice brand in the Singapore market, while competitors are facing difficulties such as: India is facing the risk of widespread drought, the price of Thailand rice is too high (from USD 545-550/ ton to USD 840-850/ ton FOB) - The Singapore prefers Vietnamese rice to Thailand rice It is also a chance for Hung Lam Rice to expand the market Threatens 4.1 From inside - There are a lot of Vietnamese competitors in Singapore market - The economic crisis is a problem affecting to investment The difficult access to banking loans will affect to the production capacity of Hung Lam Rice - Hung Lam Rice is a long-standing company with working in several stages showed signs of trails The development to the new market requires new strategies and creative breakthrough 4.2 From outside - Although there are many difficulties but other international competitors such as India or Thailand will always be the major challenges that Vietnam has to face Not mention to China whose products are cheap and the ability for supplying large quantities in a short time is also one of the difficulties that Hung Lam rice must face in the future - SCS is currently a big problem if we chose to export rice by shipping - The variation of nature: In recent years, the weather is constantly changing IV/ PROPOSED STRATEGIES FOR HUNG LAM RICE WHEN ENTERING INTO SINGAPORE MARKET Proposed strategy 1.1 In short term Hung Lam Rice builds relationships with the reseller in Singapore, to promote price competition (probably a loss to promotion for the first time) 1.2 In long term Along with wholesales, Hung Lam Rice will focus on building a network of direct sales in Singapore The system will provide rice to end-consumers in Singapore 1.3 Why chose this strategy - Based on SWOT analysis, all the data showed that: Singapore market is potential but also the old market in which there have been many existing providers Hung Lam Rice has the strengths of goods, transportation costs and prices Now, we need to promote price competition for the first time to establish a relationship and elevate brand to customers - The transportation between Singapore and Vietnam is very convenient Tariffs and government policy are very supportive so that in the long term, Hung Lam Rice should continuously improve ability on price competitive, build the retail network in Singapore to save more intermediate costs 10 - Revenues in the short-term strategy will be rolled over for the company's long-term strategy Strategy implementation 2.1 In short term - Doing market research and launching new high quality product - Planning offers to the Singapore's largest rice importation agents Focus on: + Product quality: Pay attention to new products which are difference to commons others in Singapore + Researching on prices, attempting to reduce the cost up to the lower price Hung Lam Rice should lower profit targets to reduce the price of the product - Collaboration and funding for agents with promotions to build direct channel advertising company that brings image and products to the people The promotions could be: + Funding for cookery program on TV + Special Offer for Vietnamese and Asian community living in Singapore 2.2 In long term - Searching for sales point and creating the nd agent which is in direct competition with dealers importing rice from Hung Lam - Building product branding: + Advertising on the public media such as: radio, TV, newspaper, agriculture magazine, etc… + Funding for TV program + Funding for community activities such as cooking contest, Vietnamese student studying in Singapore… - Distribution + Combination agent sales and direct sales + Building retail channel and promotion for retail: o Door - to - door service o Free trial o Collaborators from Vietnamese students and community living in Singapore 11 o Commission for introduction, broker and chef at the restaurant… V/ CONCLUSION In this article, I have not given the entire detailed, but based on the above analysis I found that rice exportation to Singapore is workable This is a wise investment and long-term expansion of enterprises in Vietnam If I have opportunity, the article will be developed into larger-scale theme with the strategy and specific implementation REFERENCES: Websites: - www.baodientu.chinhphu.vn - www.gentraco.com.vn - www.dailodoanhnhan.com.vn - www.hunglamrice.com.vn - www.mof.gov.vn - www.saigondautu.com.vn - www.baomoi.com 12 ... The system will provide rice to end-consumers in Singapore 1.3 Why chose this strategy - Based on SWOT analysis, all the data showed that: Singapore market is potential but also the old market in