Tiếng anh: Phân tích dự án kinh doanh của PNJ mở rộng kinh doanh sang Ấn Độ. Bao gồm: giới thiệu PNJ và product lines, PESTEL, SWOT, 5 forces, porter diamond, Ratio analysis, and solution: 4Ps, Campaign roadmap.
Trang 1I Introduction
1.1 Overview of Phu Nhuan Jewelry Joint stock Company
Phu Nhuan Jewelry Joint Stock Company specializes in producing and trading gold,silver, gemstones jewelry, business gifts, fashion accessories, souvenirs, watches, gold bartrading, providing diamond and stone inspection services, precious metals, and real estate.Established in 1988, PNJ has become the leading jewelry manufacturer and retailer in Asia,with more than 350 retail stores nationwide In 2010, PNJ was ranked 16th by Plimsoll in thetop 500 largest jewelry companies in the world
Vision: to become a leading jewelry manufacturer and retailer in ASIA, sustaining its no.
1 position in the middle and high-end jewelry market share in Vietnam
Mission: PNJ brings pridr to customers by ít exquisite and transcending jewelry products.
Core value: integrity – responsibility – quality – innovation – cohesion
1.2 History of foundation- development:
1988-1998: Pioneering process: MNJ defines its development strategy as a professional
jewelry manufacturer and trader
1999-2008: Consecutive breakthroughs: This period marked a lot of changes The core
values of PNJ were always promoted and developed into a strategic “launching base’ thatturned challengses to opportunities
2009-2020: Making exploits: PNJ has realized its vision as a leading jewelry retailer and
manufacturer in ASIA maintainning the number one position in the middle high-endjewelry market in Vietnam
1.3 Products and services:
PNJ gold jewelry
Since its inception in 1988, PNJ Gold Jewelry has taken constant efforts to innovate andproduce hundreds of collections,which are varied by the gold materials and gemstones Theirdesigns representthe essence of pioneering and honor of the beauty, elegance and class ofVietnamese consumers The gold jewelry products under PNJ brand are always thefascinating mix of luxury and uniqueness, fashion and modernity Every piece is vividlysouled by talented designers and skillful hands of jewellers, who guarantee the highsophistication and aesthetics to please the tastes of all customers
Trang 2 CAO fine Jewellery:
Born in 2005, CAO Fine Jewelry gradually won the heart of high-class customers for itsdistinctive high-end niche CAO Fine Jewelry products are made from 18K gold, diamonds,precious stones and semi-precious gems of vivid colors - all are guaranteed of the illuminationand sharp cuttings which are done by first-class masters of precious stones crafting, oraccredited by the world’s leading testers
PNJ silver jewelry and assesories:
Since its first steps intoVietnam’s jewelry market in 2001 until now, PNJSilver has beenlike a modern young girl who always leads the trend by wearing diverse and contemporaryjewelry and accessories Pursuing the fashionable and dynamic pink and purple colors, PNJSilver is proud to be a recognizable jewelry brandin many shopping centers across Vietnamandquenches the thirst for fashion jewelry of young people who are of PNJ Silver's targetcustomers
Jemma jewelry and accessories:
Inspired by the ever-louder trend of fashion accessories in the world, JEMMA as ahighend jewelry accessories brand was born in late 2009 Heading forthe position of a fashionaccessory high-class and modern brand, JEMMA offers itself as a new choice forwomen’selegance and nobility All JEMMA products are designed in modern style and follow theupto-date fashion trends usinga diversity of materials from silver, high-grade alloy andcolorful semi-precious stones These pieces of craft are not just original fashion products, butrepresentative of the class, the pride and exquisite aesthetic taste of those who wear them
PNJart- Premium corporate gift:
The advantages of design level, crafting technology and a team of highly-skilled artisansand goldsmiths has empowered PNJ as one of the pioneering brands to develop a Gift line toserve corporate customers with diversified and preminent quality models These gift productsare carefully elaborated in the meaning of giving values, making beautiful expressions, notonly honoring the true, the beautiful of both sides but also manifesting the pure and corlorfulbeauty
PNJ watch:
Trang 3The first presence of PNJ in the watch market in 2012 was made toward the middle andhigh-end segments, just in line with the company's jewelry market conquering strategy PNJWatch has been making steady progress with popular products namely Longines, MichaelKors, Movado, Tissot Against the context of a fragmented market, this business promises aleading stance in genuine watch distribution throughout Vietnam.
PNJ Inspection services ( diamond, gem, precious metal):
PNJ Laboratory Company Limited was established by PNJ as an leading inspectioncompany for diamonds, gemstones, precious metals in Vietnam PNJLab is now the leadinginspection company in Vietnam and among a very few Vietnamese accrediting companiesthat are successfully built and operated according to international standards ISO/IEC 17025.More than 20 years of operation, a team of experienced and well informed experts andmodern technology equipment, the responsibility, honesty, transparency, neutral behavior andhigh precise has empowered PNJ Lab to affirm its reputation toward domestic and foreigncustomers
II Business objective
With the goal of becoming the leading manufacturer and retailer in the jewelry industry inthe Asia market, bringing the beauty value to woman and confidence with the strong capital
and current position of PNJ in the Asia market, PNJ will expand the market to India with the desire to achieve a net operating profit of $ 3 millions within 18 months (6 months of
surveying the Indian market and 12 months of official sales) The campaign will be implemented after the Indian market recovers (from 2022 to 2023).
III External and Internal analysis
3.1 Pestel analysis
Political/Legal factors that affect India
India is one of the most powerful countries in the world New Delhi is its capital Itneighbours two powerful countries i.e China and Pakistan Other neighbouring countries areBangladesh, Myanmar, Nepal, Bhutan, & Sri Lanka
India is the largest democracy in the world and enjoys a relatively stable political environment This political culture of tolerance contributes immensely to maintain a stable
Trang 4political climate which is in fact a very important factor to attract foreign direct investment(FDI).
Before 1992, the import of gold into India was banned by the gold control legislation.Only two businesses are allowed to import gold into India, namely MMTC (Minerals andMentals Trading Corporation of India) and SBI (the State Bank of India).However, in 1992the law controlling gold was removed, allowing major exporters to import gold freely WithIndia creating investment opportunities for the import and export of gold and jewelry has led
to the penetration and of many businesses Not only domestic enterprises India’s opening up
of investment opportunities for the import and export of gold and free jewelry has led to theentry into this market by many world-famous brands
Duty tax rate for imported jewelry from ASIAN : 12.5% (30% from others)
=>With a stable political and there are many laws which are favorable for importing gold into the Indian market, PNJ believes that this is a opportunities to penetrate ư into India Moreover, with the tax rate for imported jewelry is 12.5%, this is also an advantage for Vietnam when investing in Indian market
Economic factors that affect India
India is the 5th largest economy in the world India and attracted a high FDI.According to the Department of Industrial Promotion and Inland Trade (DPIIT) under theMinistry of Industry and Trade of India, the total amount of foreign direct investment (FDI) inIndia from April 2020 to September 2020 reaches 500.12 billion USD, this firmly affirms theposition of this country as a key and safe investment destination in the world.5th largesteconomic in the world
India is one of largest economies in the world in terms of nominal GDP Its GDPgrowth rate in 2020 was worth around 5% The inflation rates around 4.9% and tend todeclines in recent years The disposal income is $2,170 However, the consumer demand hasweakened recently Consequently, the economy is slowing down causing people a lot ofconcern The lockdown in 2020 was devastating for the country with a job loss of around 122million people The unemployment rates of India around 7% and tend to decrease
The corporate tax rate in India is 25.17%; however, it is forecast to increase soon It isworth noting that the country witnessed frequent corporate tax rate changes over the years.For example, the tax rate in 2010 was 33.99%, while it reached an all-time high of 38.95% in
2001 (Trading Economics, 2021)
Trang 5India’s key exports are petroleum products, jewellery, pharmaceutical products,transport equipment, machinery and readymade garments to name but a few On the otherhand, India imports crude petroleum, gold and silver, electronic good, pearls and preciousstones and many other things Some of the top trading partners of India are China, UAE,Switzerland, Saudi Arabia, USA, and Qatar (Guardian News and Media Limited, n.d.).
India is one of the fastest growing economies in the world It has a massive domestic marketthat offers numerous opportunities for both local and international organisations
After growing at very high rates for years, India’s economy had already begun to slowdown before the onset of the COVID-19 pandemic According to data released by the IndianMinistry of Statistics and Program Enforcement at the end of August 2020, in the first quarter
of 2020 GDP is at constant prices of This country only reached about 37.8 billion USD, downabout 23.9% compared with the positive growth of 5.2% in the same period last year TheGovernment and Reserve Bank of India (Central Bank) also quickly implemented measures toreform, cut interest rates and launched economic stimulus (stil mi lớt) packages to reduce theimpact of pandemic In its latest World Economic Outlook report published on January 26,the World Monetary Fund (IMF) predicted that India's GDP would grow at a rate of 11.5% by
2021
=>PNJ believes that with India's efforts in disease prevention and economic recovery, the future of a strongly developed economy is possible This robust domestic economy will increase the proportion of middle to upper middles-class and that will effectively increase the market share of the firm Since jewelry has high income elasticity of demand, as incomes rise, customers “will likely use their increased income to purchase more luxury goods and services”
Trang 6 Social factors that affect India
Demographic
India has a gigantic consumer market with a total population of over 1.380 billion(Worldometer, 2021) while 48.04% is females growing at an average annual rate of 1.82%and population growth rate is 0.99% Three largest city has the highest population density:Mumbai & Deli , Bengaluru The age distribution: 63.66% females at age 15-64 years Such ahuge market is a great opportunity for multinational companies No wonder why so manymultinationals are operating in India! India offers cheap labour and is likely to become one ofthe top three economic giants in the world over the next 10-15 years (IBEF, 2021) Accessibleand affordable labour force has encouraged many multinational companies to outsource some
of their business operations to India
India is one of the most attractive markets in the world in many sectors Standard ofliving is gradually improving and the country has a growing middle class with gooddisposable income However, it is worth noting that India still suffers from poverty withmillions of people live on less than $2 a day Likewise, poor wealth distribution is also anenormous problem for the country
Culture
- Jewelry is an indispensable part of Indian culture, having its roots in ancient culture.Previously, jewelry for the needs of aesthetics and beauty accounted for only a small share inthe jewelry market due to the perception of the Indian people seeing jewelry as an investment.Today, even though the government has opened the door to deregulate luxury goods, theIndian people's perceptions of jewelry have not changed completely, most of them are stillvery cautious However, this concept has gradually changed and is especially strong for theupper class, who have the opportunity to come into contact with many cultures around theworld
- Gold jewelry is widely used and widely used, playing a role in the customs, culture andaesthetic issues of both men and women In addition, the issue of class has not been clearly
shown, so high-end jewelry is still a way to help the elite assert their level This is also the
reason why luxury jewelry is popular and attracts the attention of many people Indians tend
to increase their purchasing power with gold jewelry products when the festive season comes.With many families in India buying gold also takes place regularly on a monthly or quarterlybasis
Trang 7- India ranks second among six key gold markets in the world: China, India, Italy, SaudiArabia, Turkey and the United States (according to a report by the World Gold Association).
In the late 90s, the Indian jewelry market saw a shift in consumer perception of jewelry.Instead of gold jewelry being evaluated as a choice to start from, it is now evaluated for itsaesthetic appeal In other words, it seems that the focus has shifted from content, quality toshape and style
=> This can be viewed as promising opportunities for PNJ to expand its business as the demand for gold, jewelry in special occasions is substantial, and the market is still young.
Technological factors that affect India
India is one of the strongly developed countries in digital technology and digitaleconomy In fact, according to some sources, it is the 3rd most technologically advancedcountry in the world No wonder why more and more tech giants including but not limited toFacebook, Microsoft, Amazon, and Apple are investing billions of dollars in the country TheIndian government has devoted a lot of attention, support and promotion to the digitaleconomy and turned it into a strong growth driver of this country India has many programs topromote the development of digital economy such as: National e-Governance Plan; DigitalIndia; Make in India; Skill India; Smart Cities
Digitalization offers Indian users a whole new online shopping experience Of which85% tend to prefer the experience through mobile devices over traditional ways Consumerspending is now heavily influenced by digital in all ways, with getting recommendations fromfriends, finding new products or deciding to shop
=>In order to penetrate the Indian market, in addition to building stores and jewelry centers
to increase brand awareness, it also focuses on building shopping websites with professional layouts, glitter, and clear information on each product and launch attractive advertisements Along with that, PNJ also needs to have online shopping services, pay by credit card, transfer and allow buyers to place orders via mobile phones by sending text messages
3.2 Five forces analysis
Threat of substitutes is low
Because there is no substitutes product that can replace jewelry and gems to serve thesame purpose and provide the same value for users
Trang 8 Bargaining power of suppliers is low
Materials of jewelry is gold and gems whose price is controlled strictly by government.Therefore, suppliers have no right to make price
Competitive Rivarly is high
Competitive rivalry in this sector is very high as there are a large number of players withsimiliar products, whereas the customers do not have a switching cost
Bargaining power of buyers is low
Buyers have no power due to the price of gold and gems in market regulated and therefore
it is fixed and usually similiar across sellers Besides, the gap of prices of jewelry often causes
by the design, which customers must accept
Threat of new entrants is high
With the policy as reducing duty tax rate from ASIAN countries aims to encouragesforeigner’s investment thus, it is not very difficult to set up a jewelery business in India
3.2 Porter’s Diamond analysis
Factor conditions:
India has large population - 1,391 billions which rank 2nd in the world, in which workingage population accounts for about 60% of total population and the unemployment rate is nothigher than 10% (during pandemic covid-19), which shows that India is an potential market topenetrate Moreover, PNJ should refine their product lines to concentrate customer group atage 18 to 45 who accounts up to 35% of population
With stable political and developmental capital market, specially FDI, capital mobilization
to expand market operation becomes more easily in India
Demand condition
Jewelry is one of india's most essential products which belongs to culture, so the demandfor jewelry is high, however, Indian are strongly influenced by religion, so product designneeds to be focused to easily conquer customers
Trang 9 Related and supporting industries
Technology industry is one of key industries of India, therefore, it could provide the highquality marketing media to endorsing products In addition, technology market develops willpromote e-commerce activities
India’s transportation industries is quitely developmental, which can support retail market
Firm strategy, structure and rivalry
The jewelry market in Indian operates through traditional small shops thị trường whichaccept cash payment However, since 2016, the government tightened in cash payment andimprove the tax service systems GST, therefore, the traditional shop has not been position onthe market To deal with these changes, PNJ could operate through franchising or establishedthe official brand with large small retailed shops systerm as in Vietnam
All in all, India is a potential market for PNJ explore and expand operation market, additionally, it is the opportunity for PNJ to raise their brand into the world.
3 days sale in account receivable 2,38 3,06
Days sales in account receivable decrease from 2019 to 2020, which expresses that thecompany has improvement in convert account receivable into cash
Trang 10Days sales in inventory rises from 161,72 days to 176,02 days (2019-2020), it can beimplied that the compay becomes selling inventory more slowly than in 2019, which can beexplained by the affect of covid 19 pandemic
Equity ratio increases, which can be explained that there is a large amount of profit in
2019 is not distributed in 2020, which leads to the owners’equity increases
Net income to net sales ratio, ROA and ROA decrease, which express that the sales ofthe company is not good during 2020 when pandemic occurs
3.3.2 Horizontal analysis
Net revenue from sales 17,510,789 17,000,682 510,108 3.00%
Net profit after tax 1,069,311 1,193,925 (124,615) (10.44)%
From 2019 to 2020, Net revenue from sales of goods and rendering services increases3%, which implies that PNJ still could sell products during the pandemic covid-19, but inorder to achieve that, PNJ must bear the increase in selling expense (4.34%) and general andadministration expenses (6.25%) Moreover, financial activities is unsatisfactory as financialincome significantly drops by 85.92%, whereas interest expenses increases by 33.85% from
2019 to 2020 Sources of income is disappointed while expenses increases, which leads to netprofit after tax of PNJ declines by 10.44% In short, it can be stated that PNJ could sellproducts in any case, but high financial investments could drastically affect to net profit ofPNJ as whole
Trang 11and Owners’capital accounts for 26,19% of total resources, these are main resources ofcompany However, in 2020, there is a gap between Liabilities and Equity when the enterpriseslightly raises the amount of owners’capital and decrease the amount of short-term debt by8.67% It seems that the company have potential resources which less depend on debt, itmight be due to short-term debt has more risks, one of disadvantages clearly realized isinterest expenses shown in Income statement increases by 33,85% from 2019 to 2020.
Generally, it does not change in structure revenue of PNJ from 2019 to 2020 The cost
of good sold is quitely high which accounts 80% of total revenue Therefore, gross margin isaround 20% and net profit after tax only makes up 6% of total revenue It can be indicatedthat trade in jewellry does not bring potential profit for PNJ
=>PNJ has potential resource from their shareholders which less depend on debt However, although PNJ products are high value, cost of good sold is still high which could not bring high profit for PNJ.
3.4 Swot analysis
Strengths
PNJ has more than 20 experienced-year in the jewellery industry, thus, PNJ has builtstrong brand awareness and trusted by consumers With high technies and technology injewelry manufacturing, PNJ could provide the diversity in types of products which have thiết
kế tinh tế to conquer customers Moreover, PNJ also have multiple investments in R&D inorder to find new products meet customer’s need Besides, PNJ usually maintains sustainablerelationships with partners helps the entity has strong capital resources to have capacity tooperate in foreigner
Weakness
Most of materials is imported from foreigners with high cost, thus, the cost of goods soldare affected strongly by this material cost Whereas, although product price is high, the grossprofit margin is still quite small In additional, because the long-term investments are quitelarge, PNJ might face the financial risk when these investments are not effective