TRƯỜNG ĐẠI HỌC MỞ TP.HCM UNIVERSITÉ LIBRE DE BRUXELLES HO CHI MINH CITY OPEN UNIVERSITY SOLVAY BRUSSELS SCHOOL MBMM4 Tran Anh Tuan Factors Influencing Customer Behavior of Butter Oil Substitute In Ho Chi Minh City MASTER PROJECT MASTER IN BUSINESS & MARKETING MANAGEMENT Tutor’s name: Dr. Ha Nam Khanh Giao Ho Chi Minh City (2010) Tai Lieu Chat Luong i ASSURANCE This thesis contains no material that has been accepted for the award of any other degree of diploma in any university or other institution and to the best of my knowledge contains no material previously published or written by another person, except where due reference is made in the text of this thesis. In this study, professional interviewers, observed by an independent quality controller and the author of this thesis, conduct the survey. Thus, it has high level of trust, confidence and agreement.
This information of this thesis use for limited purposes and not allow to be spread out excepting for the jury of Solvay Business School and some marketing professionals including the MBMM tutor. ii ACKNOWNLEDGEMENT I am grateful to Dr. Ha Nam Khanh Giao for having read several chapters in my thesis and giving me invaluable comments and suggestions. Besides, without his intellectual support and his continuous guidance, full of patience and enthusiasm, my thesis would not have been materialized.
I also wish to thank my study group in MBMM4 class, who gave me endless experienced and mental support. Finally, my thanks go to the Professors of Solvay Business School for wonderful program and intellectual support during my MBA program. Ho Chi Minh City, Dec 14th, 2010 ---------------------------------------- Signature of the student Tran Anh Tuan Master of Marketing & Business Management iii TUTOR’S COMMENTS The thesis on the topic customer behavior of Butter oil substitute in HCM is high practical significance. Research objectives are properly identified.
Student has used the appropriate methodology. Results obtained with the new creation with scientific content as well. In particular, the author highlights the factors that influence customer behavior in coffee industry. The results and conclusions of the thesis with applicable recommendations are useful information for the organizational who want to enter the specialty fats business in Viet Nam.
However, the project also has certain limitations, such as only on HCM scale, small samples size … Student tries his best to conduct the thesis and has a lot of efforts to gather information as well as to conduct a research to understand the purchase decision of customers in coffee roasting industry. The thesis meets requirements of MBA thesis. I suggest the committee should allow the author to present it to your kind perusal and consideration. Ho Chi Minh City, Dec 14th, 2010 Dr.
Ha Nam Khanh Giao iv CONTENT ASSURANCE. ii TUTOR’S COMMENTS. iv LIST OF FIGURES. vi LIST OF TABLES.
Specialty Fats market. Scope of the project. Framework of Research. CHAPTER 2: LITERATURE REVIEW.
Industrial Buying Behavior. Factors Affecting Buying Process & Buying Center. The buying Center. Long-term relationships in industrial markets.
Scale using in theoretical framework. CHAPTER 3: RESEARCH DESIGN. CHAPTER 4: DATA ANALYSIS. CHAPTER 5: FINDINGS, RECOMMENDATIONS AND CONCLUSIONS.
Limitations of the study and future research. 37 APPENDIX 1 - Survey questionnaire. 39 APPENDIX 2 – Descriptive Analysis. 43 APPENDIX 3 – Reliability Analysis.
44 APPENDIX 4 – Factor Analysis. 46 APPENDIX 5 – Regression Analysis. 48 vi LIST OF FIGURES Figure 2.1: BOS and its application .2: Specialty fats market .1: Areas of industrial buying behavior. Adapted from Baptista and Forsberg (1997), p.2: The conceptual model of selection BOS supplier .1: Position of respondents .2: BOS volume per month .3: Experience of respondents with BOS in coffee roasting.
22 vii LIST OF TABLES Table 3.1: The importance of different classical decision criteria.2: List of common choice criteria in prior studies .3: Scale using for independence variable .1: Descriptive analysis of factors influencing customer behavior.2: Reliability statistic of five independence factors and one dependence factor.3: Factor analysis with Promax method .4: The list of new factors. 29 1 Solvay Burussels School – MBA Thesis Tutor: Dr. Ha Nam Khanh Giao 1. EXECUTIVE SUMMARY The study was aimed at determining the impacts of factors that influence the customer behavior of Butter Oil Substitute (BOS) in coffee roasting industry.
The study was carried out in Ho Chi Minh City on 88 customers using face to face interview and structured questionnaire as the instruments for data collection. Questions were designed to find out how consumers behave in relation to BOS for coffee roasting. The study showed that the purchase of BOS in coffee roasting industry is influenced mostly by the customer’s price consciousness, relationship between buyer and seller, and customer service. Implications of the study used as references for the planning of marketing strategies and as the basis for future researches in the customer behavior with regard to bakery customers (another application of BOS) and specialty fats in general.
2 Solvay Burussels School – MBA Thesis Tutor: Dr. Ha Nam Khanh Giao 2. Background introduction Vietnamese coffee is roasted differently from coffee in other regions of the world, a unique process, involving butter oil and techniques that bring out the highest development of flavor without over-roasting or burning the coffee. Coffee beans are generally roasted in what is referred to as butter oil substitute (BOS).
Butter oil substitute is a replacement for butter oil. BOS is processed from vegetable oil instead of milk therefore it has economic. BOS is widely used in the coffee roasting industry to replace the expensive dairy-based butter oil. The functionality of BOS is similar to that of butter, which is to smoothly, fatty beans.
The unique characteristics of the BOS product are its strong butter flavor and a deep yellow color. BOS has being hot in recent years in Vietnam due to low price & convenience for coffee roasting industry.1: BOS and its application There are about 300 coffee roasters in Vietnam. All most all of coffee roasters are using BOS to add in roasting process. Dosage is about 3% - 5%.
According to the association’s date, BOS’s volume from import statistic estimates about 7,000mt per year, almost from Malaysia, Indonesia. Problem statement Wilmar International Limited is Asia’s leading agribusiness group, and their operations are located in more than 20 countries. Wilmar’s business activities include oil palm cultivation, oilseeds crushing, edible oils refining, consumer pack edible oils processing, 3 Solvay Burussels School – MBA Thesis Tutor: Dr. Ha Nam Khanh Giao specialty fats, oleo chemicals, biodiesel manufacturing, and grains processing.
In Viet Nam, Cai Lan Oil & Fats Industries (Calofic) is a market leader in cooking oils industry of Viet Nam, through famous cooking oils brands such as Neptune, Simply, Meizan, Cai Lan, Kiddy and Olivera. Besides, with support from Mother Company, they plan to expand business activities in specialty fats segment. Specialty fats include BOS (butter oil substitute), shortening, Margarine, and Hydrogenated oil. BOS extensively used for top grade cake, cookie making and coffee roasting.
In order to exploit the existing distribution network, it is necessary for Calofic to study the factors influencing the customer behaviors of BOS, especially for coffee roasting in Ho Chi Minh City. Specialty Fats market The sales volume for the specialty fats segment in Viet Nam has reached $49 million for a volume of 35,000Mt in 2010. Calofic’s volume has shown a steady growth since 2008: an increase of 10. Imported companies are the current market leader with 47% of the market shares in 2010.
Calofic is second with 38%, the others belong to local manufactures.3: Specialty fats market 4 Solvay Burussels School – MBA Thesis Tutor: Dr. Ha Nam Khanh Giao Figure 2.3: Calofic sales The imported volume was estimated to account for 47% of the specialty fats market. The table below determines the attractiveness of a market, both now and in the future.3 Imported products 5 Solvay Burussels School – MBA Thesis Tutor: Dr. Ha Nam Khanh Giao According to imported statistic, BOS is a fast growing market with an annual growth of approximately 15%.
The BOS market in Vietnam is highly competitive and fragmented due to the presence of many trading companies, exclusively distribution of multinational producers. There is no dominating company in the market. Customers have many choices among imported products. In this situation, Calofic have been actively engaged in BOS segment for coffee roasting industry in order to catch the growing demand, and also to increase the sales in other markets where product offerings are quickly maturing.
Research objectives Measure the factors influencing the customer behaviors of BOS for coffee roasting industry in Ho Chi Minh City. Provide recommendations for management to develop marketing strategy. Research method Secondary research: study the customer behavior theory and model to define the factors influencing the customer behaviors. Primary research: conduct quantitative research to measure the relationship between these factors and study the finding to infer the recommendations.
Scope of the project This study focuses on coffee roasting customers in Ho Chi Minh City, who buy BOS for coffee roasting process. BOS application in bakery and confectionery are not covered by this research. Customers from other provinces are not chosen to be the subjects of this study because of limit of time. 6 Solvay Burussels School – MBA Thesis Tutor: Dr.
Ha Nam Khanh Giao 2. Research structure The research paper is arranged into five chapters. Chapter 1 introduces the research background, objectives and rationale as well as the scope of the study. Literature review is presented in chapter 2.
Chapter 3 describes the methodology applied in the study. Data analysis is presented in chapter 4. Chapter 5 summarizes the research results, provides recommendations to company and future research. Framework of Research This thesis will be followed below stages: Objectives of the Research Literature review Qualitative research Theoretical framework Research design Data analysis Findings, Recommendations and Conclusions Figure 2.5: Research framework 7 Solvay Burussels School – MBA Thesis Tutor: Dr.
Ha Nam Khanh Giao 3. CHAPTER 2: LITERATURE REVIEW 3. Chapter overview The previous chapter has briefly discussed the general research background, the overview of Vietnam specialty fats market and the key research objectives. This chapter contains an overview of literature on industrial buying behavior.
The theories regarding the buying process, buying center, and affecting factors are all divided and presented in smaller parts. Furthermore the concept of decision making units within industries will be discussed and is followed by a brief discussion regarding choice criteria in industrial buying. Industrial Buying Behavior Buying behavior in this study will focus on the industrial buying behavior (hereafter IBB). IBB is a complex process over time that involves interaction between several persons, both within and outside an organization (Webster & Wind, 1996).
Many authors have researched this issue and there is a general agreement that the major components of industrial buying behavior are: the buying process; the buying center; and factors affecting the buying process and the buying center (Bapista, 2001). Wind and Thomas (1980) have suggested that industrial buying behavior can be divided into three different areas: buying process, buying center, and affecting factors. Each of these areas consists of several parts, which can be seen in figure 5. 8 Solvay Burussels School – MBA Thesis Tutor: Dr.
Ha Nam Khanh Giao Factors affect BP & Buying process Buying center BC Roles in the Environmental Identification of BC Needs Inter-organizational Influence in Identification of the BC Organizational Alternatives Interpersonal Identification of Alternatives Individual Buying situation Set Purchase and Usage Criteria Evaluate Alternative Buying Purchase Decisions Post purchase evaluation Figure 3.2: Areas of industrial buying behavior. Adapted from Baptista and Forsberg (1997), p. Buying Process Wind and Thomas (1980, p.