UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------------ Le Ngoc Hai Trieu SOLUTIONS FOR LACK OF MARKETING ACTIVITIES OF VIET PHAT UNIFORM LIMITED COMPANY MASTER OF BUSINESS ADMINISTRATION Ho Chi Minh City – 2019 LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------------ Le Ngoc Hai Trieu SOLUTIONS FOR LACK OF MARKETING ACTIVITIES OF VIET PHAT UNIFORM LIMITED COMPANY MASTER OF BUSINESS ADMINISTRATION SUPERVISOR: DR. LE THI THANH XUAN Ho Chi Minh City - 2019 1|Page LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Table of Contents 1. The company overview. 7 CHAPTER II – PROBLEM IDENTIFICATION.
Limited customer network. Lack of brand awareness. Ineffective digital marketing. Main problem validation.
Problems – Symptoms Map. 21 CHAPTER III – CAUSE ANALYSIS. Lack of attention from the board of directors (B. Lack of resources.
Initial Cause-Effect Map. Main cause validation. Lack of resources. Final Cause-Effect Diagram.
32 CHAPTER IV – ALTERNATIVE SOLUTIONS AND ACTION PLAN. Establishing a marketing department. Investing more capital budget to conduct marketing activities. Hiring employees to support marketing activities.
39 CHAPTER VI – SUPPORTING MATERIALS. 62 2|Page LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com List of tables Table 2.41 3|Page LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com List of figures Figure 1.40 4|Page LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Executive summary Nowadays, as the world has developed continuously, the living standard has been improved rapidly. In order to meet those standards, more and more businesses have been established. Specifically, in the garment industry, there are many firms that are able to providing uniforms for both schools and businesses.
However, there is just a few companies meet the required standards of customers. Therefore, Viet Phat Uniform Limited Company has been established to offer high quality uniform with reasonable price. As a new and small business, Viet Phat Uniform Limited Company has many weak aspects that need improvements, especially the marketing field. Firstly, it is realized that it has limited customer network, lack of brand awareness from the customer, and ineffective digital marketing.
From the above symptoms, it is considered that Viet Phat is facing some potential problems, such as high price and poor product’s quality, lack of marketing activities and poor training for sales staffs. Nevertheless, through analyzing and synthesizing data and information, it is realized that the main problem that it has faced is lack of marketing activities while its B.D just focus on expanding the customer network based on their relationships. At the beginning, it is considered that because its B.D does not pay enough attention to the marketing aspect and they chose wrong personnel to cover the marketing job that lead to its main problem. However, based on the above analysis, data and arguments of its B.D, CEO, staffs, and other stakeholders, it is found that the main cause that leads to this problem is lack of resource.
Particularly, because of the difficulties in the initial stage of a startup business, its B.D cannot provide sufficient resource including both human and financial resource to implement marketing activities. After many internal and external factors have been considered, it is suggested that Viet Phat shoud recruit more employees to support its CEO who is simultaneously in charge of the marketing aspect in building an obvious marketing strategy and executing marketing activities efficiently. 5|Page LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com CHAPTER I – INTRODUCTION 1. The company overview In Vietnam, students have to wear uniforms when they go to school, especially in primary and high schools.
Additionally, many businesses in Vietnam require their employees wear uniform when they go to work. Although this is not a new market, there is a few businesses having reputation in providing uniforms having good quality for both schools and businesses. Therefore, Viet Phat Uniform Company Limited was established at the end of 2018 with the ambition of meet the needs of a great number of customers, gain a big market share in the niche market, and build good reputation to become one of the most famous uniform brands in Vietnam. Its organizational chart is as below: B.D CEO Sales Accounting Department Department 3 staffs 1 staff Figure 1.
The organizational chart of Viet Phat Its board of directors (B.D) consists of 2 persons, they are responsible for investing money to the company when it needs, making important decisions and also building the business strategies. The company has a Chief Executive Officer (CEO) with responsibilities of managing all activities of the company, cooperating with BOD to make business strategies, communicating with departments to deliver tasks to them as well as it is suitable for its strategies and directions, and work with manufacturers. As 6|Page LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Viet Phat has just been established for a few months, CEO has to work in many roles to save costs, especially in marketing aspect. She is responsible for developing business’s goodwill, conducting marketing activities, such as advertisements on media channels, marketing campaigns, etc., and suggesting ideas to let customers know about Viet Phat and its products.
It also has an accountant to do accounting tasks as the company does not have too much accounting activities to do in this initial stage. There are 3 sales staffs in sales department to approach potential customers in order to boost sales revenue up and widen customer network. They have to find customers, meet them, and introduce its products and benefits that customers can get if they cooperate with Viet Phat. Viet Phat is a startup business which offers uniforms for not only schools but also businesses.
In order to gain more market share, Viet Phat offers customers higher discount rate than its rivals. Particularly, it offers 30% discount rate for customers when rivals offer approximately 25%. It competes with other rivals by discount rate in not only the initial stage but also later. Additionally, Viet Phat always tries to provide customers products having high quality material and beautiful seam but with competitive price.
Because Viet Phat is a new comer in the market, its target customer concentrates on schools in Vietnam in initial stage. As those schools have new students every year, they have to order uniforms for both new and current students. It will bring Viet Phat stable order and income each year. However, Viet Phat still serves businesses that have demand in order uniforms to develop the customer network.
However, it will be focused more after the company has certain market share and goodwill in Vietnamese market. The mission statement of Viet Phat is providing uniforms with high quality material with the competitive price. Viet Phat does not manufacture clothes, it is the intermediary between the manufacturer and customers. It finds customers, deals with them, receives orders, and brings them for the manufacturer.
Then, it gives finished products for customers. To assure that Viet Phat can provide high quality material uniform, it has to deal with manufacturer to get the agreement of using chosen material. If there is any mistake of finished products, Viet Phat has responsibility to work with the manufacturer to fix them and give customers products having high quality. Problem context 7|Page LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com Vietnam’s garment sector has had speedy and sustainable development over the last few years which have played a crucial role in the country’s socio-economic development, especially there are approximately 6000 textile and garment manufacturing firms operating in Vietnam (1).
However, almost garment manufactures in Vietnam produce clothing majorly for export, not focusing on local consumption market. Vietnam held the 4th position in the top 10 global garment exporters in 2016. For example, Viet Tien, Nha Be, Garco 10 are familiar brands in garment industry in Vietnam that concentrate on exporting clothing. World Ranking Among the Top Garment Exporting Countries in 2016 (WTO Reports World Textile and Apparel Trade in 2017) Because almost big and famous garment brands focus on export market, domestic market is a “promising land” for small businesses, especially in niche market like supplying uniforms.
Obviously, for the Vietnamese garment market, the demand has been growing thanks to the higher income and higher living standard of Vietnamese. There are many opportunities for domestic garment brands if they accept the challenges 8|Page LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com and have a strategy to reach the market. As Viet Phat is a new business in Vietnamese market, it has many weak aspects that need to be improved and developed. Particularly, the most important aspect that needs to be developed is the marketing strategy.
Marketing refers to a process in which a product or service is introduced and promoted to any potential customers. Since it was established, Viet Phat has just depended on the relationship of its owners to develop the customer network. Thus, it has not had marketing strategy yet to build the image, brand position, and reputation although it is very essential in developing business in fierce competitive market. Customers should have known about its brand name, reputation, and also the image, so it can gain more market share and widen its customer network.
Nowadays, there are many competitors in the market that already has had reputation and trust from customers. Rivals can provide products that are not as well as Viet Phat, but they communicate their value for customers better, so they gain trust from customers. Hence, more customers prefer to incorporate with them to Viet Phat. They have effective marketing strategies to communicate to their customers, such as advertising on social media channels, having their own website, brochures, do some marketing campaigns and so on.
Therefore, if Viet Phat has not had marketing strategy, it can offer the best products in its niche market, however, no one can even hear of it. 9|Page LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com CHAPTER II – PROBLEM IDENTIFICATION 2. Limited customer network Every business would like to widen its customer network as broadly as possible, Viet Phat also wants the same thing. Nonetheless, it reaches current customers depending on the owners’ relationships.
Specifically, Viet Phat’s owner has good relationships with those customers, then he convinced them to cooperate with Viet Phat. In particular, Viet Phat has about only 6 current customers depending on the owners’ relationship, and they are only schools not businesses. It has not had any marketing strategies to enlarge its own customer network. Though it is good to approach certain customers initially, it cannot be considered as a long-term strategy if Viet Phat has a chance to develop more and more in the market.
CUSTOMER LIST Name District Nguyen Van Thanh Primary School 2 Dong Den Secondary School Binh Chanh Hung Long Primary School Binh Chanh Phu Tho Primary School 11 Vinh Xuyen Primary School 6 Thang Long Secondary School 3 Table 2. Viet Phat’s customers list 2. Lack of brand awareness As Viet Phat does not have any marketing activities, customers do not know anything about them. It cannot reach its target customer because its products and services have not been introduced to them.
They do not apprehend factors that products can offer for them. Therefore, it loses a great number of customers as they do not know the benefits when they do business with it. In particular, a survey was conducted by interviewing some people about their awareness of some Vietnamese uniform brands, all of people who are interviewed that whether or not they knew anything about Viet Phat said that 10 | P a g e LUAN VAN CHAT LUONG download : add luanvanchat@agmail.com they had never heard anything about Viet Phat. They do not know that what services or products Viet Phat can offer to them and benefits when they choose its products.