VIETNAM GENERAL CONFIDERATION OF LABOUR TON DUC THANG UNIVERSITY DEPARTMENT OF BUSINESS ADMINISTRATION SOLUTIONS TO ENHANCE THE EFFICIENCY OF IMPORT ACTIVITIES AT TAM DUONG TRADING AND TECHNOLOGY SERVICE COMPANY LIMITED Thesis submitted as a requirement for the degree Bachelor of Business Administration Supervisor: MBA. PHAM THI NGOC BICH Student: DINH QUANG HUY Student ID: 70900327 Intake: 2009 - 2013 HO CHI MINH CITY, July, 2013 VIETNAM GENERAL CONFIDERATION OF LABOUR TON DUC THANG UNIVERSITY DEPARTMENT OF BUSINESS ADMINISTRATION SOLUTIONS TO ENHANCE THE EFFICIENCY OF IMPORT ACTIVITIES AT TAM DUONG TRADING AND TECHNOLOGY SERVICE COMPANY LIMITED Thesis submitted as a requirement for the degree Bachelor of Business Administration Supervisor: MBA. PHAM THI NGOC BICH Student: DINH QUANG HUY Student ID: 70900327 Intake: 2009 - 2013 HO CHI MINH CITY, July, 2013 ACKNOWLEDGEMENTS I would like to send my first thank-you to all lecturers of Ton Duc Thang University who give me an opportunity to access to real business operation through my internship. Especially, I gratefully would like to appreciate Miss Pham Thi Ngoc Bich who directly gives instruction and supports me at the same time, shares the difficulties and supplies useful knowledge for me.
I would like to express my gratitude for her patience, enthusiasm, devotion that encourage me to complete my thesis. Secondly, I am really grateful to employees of Tam Duong Trading and Technology Service Company Limited who create good conditions for me to get an internship at the company. All of the employees took interest in me as well as assisted me during the internship. Everyone in the company gave me a chance to get access to real activities in business and willingly provides me with the materials and information serving for my thesis.
Thank to all of the assistances above, they are important parts to contribute to complete my thesis. Due to the limitation in the time of internship and abundant knowledge, my thesis certainly has shortcomings more or less. I do hope to acquire the precious remarks from all lecturers and the company. I do wish the lecturers health and success and I do hope the company stable development and prosperity.
Student Đinh Quang Huy COMMENTS OF SUPERVISOR Student: Đinh Quang Huy Student ID: 70900327 Class: 09070101 Intake: 13 ……………………………………………., July, 2013 Signature COMMENTS OF EXAMINER Student: Đinh Quang Huy Student ID: 70900327 Class: 09070101 Intake: 13 ……………………………………………., July, 2013 Signature ABSTRACTS Import is one of most important elelements in international trade. It contributes to create conditions for countries all over the world to exchange goods, services, customs, culture, precious value, etc. Moreover, import helps to enhance living standard of people owing to the best quality products that are exchanged between countries. This research focuses on the issues and solutions to enhance the efficiency of import activities at Tam Duong Trading and Technology Service Company Limited.
To begin with, all the issues relating to import are mentioned in the literature review. Furthermore, the current status of the company is reflected from the analysis of business results and the activities the company is operating. Especially, by combining the theory composed from famous authors, the current performance of the company and its advantages and disadvantages, solutions are given as references for the company to enhance its operation. Moreover, some recommendations are given to the Government to reform its policies and future orientation.
Table of Contents ACKNOWLEDGEMENTS LIST OF ABBREVIATION LIST OF TABLES LIST OF FIGURES CHAPTER I: INTRODUCTION .5 Data collection method .5 CHAPTER 2: LITERATURE REVIEW .1 Concepts of import .2 Types of import .3 Functions of import .4 Roles of import .1 Determining customers‟ requirements .2 Selecting resources of supply .1 Modalities of import transaction selection.2 Import contract signing .3 Preparing for import .4 Scheduling for trade or use .6 Factors affecting the performances of import enterprises .1 Political/legal factor .3 Social and cultural factors .1 Management system and administrative structure .6 Infrastructure and facility .29 CHAPTER 3: CURRENT IMPORT ACTIVITIES AT TAM DUONG TRADING AND TECHNOLOGY SERVICE COMPANY LIMITED .1 The profile of Tam Duong Trading and Technology Service Company Limited .1 The history of the company‟s establishment .2 The Process of the company‟s development .3 The company‟s functions .4 The company‟s liabilities .6 Import revenue by products .2 Organizational structure of the company.2 The functions and responsibilities of Departments. Overview of the company‟s business operation .1 The company revenue, profit and market.2 The company‟s financial status .3 The company‟s markets .4 Analysing import activities at Tam Duong Trading and Technology Service Company Limited .1 Researching the market and seeking customers.2 Selecting supply sources .3 Implementing import procedures .3 Receiving arrival note .4 Receiving delivery order (D/O) .5 Registering customs declaration .7 Checking, Determining price, taxes and paying taxes.4 Preparing for payment .1 Settling payment with foreign supplier .2 Settling payment with domestic customers .5 Delivering goods to local customers .5 Advantages and Disadvantages of Tam Duong TTS Co, Ltd .65 CHAPTER 4: SOLUTIONS TO ENHANCE THE EFFICIENCY OF IMPORT ACTIVITIES AT TAM DUONG TRADING AND TECHNOLOGY SERVICE COMPANY LIMITED .1 The business orientation of the company .3 Solutions for enhancing import activities at Tam Duong Trading and Technology Service Company Limited .1 Intensifying marketing activities .2 Incessant training and having benefit policies for human resource .3 Enhancing customer service policies .4 Improving distribution activities .5 Diversifying supply sources .6 Increasing the company‟s financial sources .7 Putting forward efficient competitive plans .8 Recommendations for the Authorities.2 Human resource development.3 Improving the legal system, simplifying administrative procedures .80 CONCLUSION REFERENCES APPENDICES LIST OF ABBREVIATION B/L: Bill of lading CFR: Cost and Freight CIF: Cost, Insurance and Freight C/O: Certificate of origin D/O: Delivery order FCL: Full container load LCL: Less than container load L/C: Letter of credit T/T: Telegraphic Transfer Tam Duong TTS Co, Ltd: Tam Duong Trading and Technology Service Company Limited WTO: World Trade Organization LIST OF TABLES Table 3.1 Import revenue by products from year 2010 to year 2012 Table 3.2 The company revenue and profit from 2010 to 2012 Table 3.3: Demonstration of changes of revenue and profit in 2010-2012 Table 3.4: The financial status of Tam Duong TTS Co, Ltd Table 3.5: List of import taxes for commodities Tam Duong TTS Co, Ltd imports LIST OF FIGURES Figure 1.1 SWOT matrix Figure 1.2 Research structure Figure 2.1 Import activities Figure 2.2 Contract implementation Figure 2.3 Institute cargo clause – summary chart – risk covered/ excluded Figure 2.4 External and internal environment Figure 3.1 Industrial machines (Source: Suppliers‟ website) Figure 3.2 Printing blanket (Source: Kinyo‟s website) Figure 3.3 Sanko steel (Source: Sanko‟s website) Figure 3.4 Structure of import products with revenue in the year 2012 Figure 3.5 Organizational structure Figure 3.6 Revenue and profit of the company from year 2010 to year 2012 Figure 3.7 Total assets status in 3 years (2010-2012) Figure 3.8 Comparison between Owner‟s equity and Liabilities Figure 3.9 Import activities at Tam Duong TTS Co, Ltd Figure 3.10 Electric customs declaration Figure 3.11 Electric customs declaration 1 CHAPTER I: INTRODUCTION 1.1 Introduction Being affected by the economic recession in the world, enterprises have to make special efforts to put forward plans and strategies that help to improve their business activities to minimize the effect of the economic crisis that can happen anytime in the future. Especially, after joining in WTO, Vietnam companies have faced much fiercer competition from globalization. Along with challenges, many opportunities are opened for enterprises to continually improve and develop their products.
Nowadays, the quality of people‟s standard living is gradually improved. So they incessantly require high quality products that meet their demands as well as their preferences. Import and export play an important role in meeting customers‟ demand and the development of a particular country as well. To perceive the importance of import and export, Tam Duong Trading and Technology Service Company Limited made a decision to import products from Japan that obtain high quality and meet the strict customers‟ demand.
Moreover, the company has also become the exclusive distributor for modern industrial machines originated from Japan. After several years doing business, Tam Duong TTS Co, Ltd got an important position in providing machines serving for production of Vietnamese enterprises. However, there are some limitations in the management and operation of the company. Being aware of these potential products the company provides in the future, I decide to choose the topic “Solutions to enhance the efficiency of import activities at Tam Duong Trading and Technology Service Company Limited” to analyse and find out limitations in these import activities.2 Rationale Nowadays, in order to get more advantage from the import, importing enterprises have to get vantage point in all field especially in current fierce competitive environment.
Currently, Tam Duong TTS Co, Ltd expects to increase profit and value from its import activities. Therefore, the problems that the company needs to do are how to enhance the efficiency of its import, 2 maximize its revenue and profit as well. In order to achieve these objectives, the company needs to put forward appropriate and efficient solutions Some following questions need to be answered from this research: How are the current import activities of Tam Duong TTS Co, Ltd? What are the main internal and external factors that affect the company‟s import activities? What are solutions to enhance the efficiency of the company‟s import activities? 1.3 Research objectives The research aims to: Examine the current import activities at Tam Duong TTS Co, Ltd. Base on this, recognize strengths and weaknesses of the company Find out the main internal and external factors that affect the performance of the company‟s import activities so that the company can recognize its opportunities as well as threats.
Thank to this, the company can develop appropriate strategies. Give solutions to enhance the efficiency of the company‟s import activities 1.4 Research methodology Research objectives are foundations to begin with examining and analysing the import activities at Tam Duong TTS Co, Ltd. Base on the literature review of import and other factors affecting the import activities, these theories are considered to be the crucial keys to refer to the performance of the company in its import operation. Rely on the current performance of the company‟s import activities, strengths and weaknesses will be found out.
At the same time, opportunities and threats the company facing will be recognized thank to the internal and external factors that have effect on the company‟s import activities. 3 Give solutions through appropriate strategies by analysing the strength, weaknesses, opportunities and threats base on SWOT model. The SWOT matrix comprises: Strengths: Attributes of the organization that are HELPFUL to achieving the objective. These are the company's core competencies.
Weaknesses: Attributes of the organization that are HARMFUL to achieving the objective. Weaknesses are conditions within the company that can lead to poor performance. Opportunities: External conditions that are HELPFUL to achieving the objective. Opportunities are outside conditions or circumstances that the company could turn to its advantage.
Threats: External conditions that are HARMFUL to achieving the objective. Threats are current or future conditions in the outside environment that may harm the company, and might include population shifts, changes in purchasing, serious competitive barriers, changes in governmental or environmental regulations, and others.5 Data collection method Secondary data which is mainly used in this research comes from: Available information from a department of Tam Duong TTS Co, Ltd including: Annual business report from 2010 to 2012 Import revenue report from 2010 to 2012 Human resource statement Reference to supervisors at Tam Duong TTS Co, Ltd to get more benefit information served for reinforcing this research. Specialist books, article, dictionary which supply information to prove what is written in this research. Internet is the indispensable means of getting the most benefit and valuable information.6 Research structure Research Objective Literature Secondary Review Data Current Import Factors Affecting Activities Performance Import Activities Analysis Performance SWOT Analysis Solutions Figure 1.