ACADEMY OF POLICY AND DEVELOPMENT INTERNATIONAL SCIENCE AND ECONOMIC FALCUTY ----- ----- GRADUATION THESIS Tutor: MA. Nguyen Tran Khanh Student: Pham Thi Trang Class: CLC 8.2 Student number: 5083106564 HA NOI, 06 - 2021 ACADEMY OF POLICY AND DEVELOPMENT INTERNATIONAL SCIENCE AND ECONOMIC FALCUTY GRADUATION THESIS Topic: Solutions to improve importing business of National Fortune Trading & Technical Services Co., Ltd HA NOI – 06/2021 ACKNOWLEDGMENT During the internship and the process of completing my thesis at National Fortune Co., Ltd, I have received a lot of attention, support, and encouragement from teachers, family, and friends. First of all, my appreciation goes to my amiable Supervisor, Mr. Nguyen Tran Khanh, for his professional guidance and support.
As my teacher and mentor, he has supplied me with all the knowledge of conducting proper research and spent hours guiding and correcting my papers. I would not be able to complete my work without his consultancy. I would like to express sincere thanks to the Academy of Policy and Development for creating favorable conditions for me to execute this internship report and thank the lecturers of the ISEF for conveying background knowledge so that I can complete the internship until this graduation thesis. Simultaneously, I would like to express my thanks to the Board of Directors, managers, and colleges at National Fortune Co., Ltd for their helpful, providing information and facilitating me to implement in the research process.
Finally, I would like to thank the family and friends for encouraging and supporting me throughout the course of study and thesis implementation. TABLE OF CONTENTS ACKNOWLEDGMENT. TABLE OF CONTENTS. List of images, tables and acronyms.
3 CHAPTER 1: THEORETICAL FRAMEWORK OF IMPORTING BUSINESS .1 General overview of importing business. The concept, characteristics and role of imports in international trade.The position of imports in supply chain management. Basic operations in import activities. General overview of business performance and importing business’ efficiency.
System of perspectives on business performance. The concept of importing business efficiency. The need to improve business performance and importing business efficiency 27 1. Basic problems about the item "heavy industrial machinery and equipment".
The concept and characteristics of "heavy industrial machinery and equipment". The system of circulars and policies that need attention applied to the item "heavy industrial machinery and equipment". The criteria for evaluating the efficiency of importing business .Criteria reflecting the efficiency of using labor for importing business. Indicators showing socio-economic efficiency.
33 CHAPTER 2: CURRENT STATUS OF IMPORTING BUSINESS OF NATIONAL FORTUNE CO. About National Fortune Trading & Technical Services Co. Company products and services. Import market of heavy industrial machinery and equipment of Vietnam and National Fortune Co.
Current status of importing business at National Fortune Trading & Technical Services Co. Import process of National Fortune Co. Evaluation of the import process of National Fortune Co. Impact of the Covid-19 epidemic on the import activities of National Fortune Co,.
56 CHAPTER 3: EVALUATING THE EFFECTIVENESS OF IMPORTING BUSINESS OF NATIONAL FORTUNE CO. National Fortune's business results from 2018-2020. Evaluate the efficiency of import activities based on the criteria. Evaluate import profit.
Evaluation of import profit rates. Evaluation of the effective use of import working capital. 66 CHAPTER 4: SOLUTIONS AND RECOMMENDATIONS. SWOT assessment of National Fortune Co.
76 List of images, tables and acronyms - List of images: Figure 1.1: Supply chain management process Figure 1.2: Purchasing Process Steps Figure 2.1: Organization chart of National Fortune company Figure 2.2: Vietnam's export and import market share of machinery and equipment 2017-2020 Figure 2.3: National Fortune's import markets in 2020 Figure 2.4: Customs clearance process for imported consignments Figure 2.5: Metal prices trends in China market May/2020-April/2021 Figure 3.1: Profit margin by import revenue of the company from 2018-2020 Figure 3.2: Return on equity of the company from 2018-2020 - List of table: Table 2.1: Import turnover of heavy industrial machines and equipments of Vietnam from 2017 to 2020 Table 2.2: National Fortune's import process Table 2.3: Changes in metal prices in China from May/2020-Apr/2021 Table 3.1: Report of business results in 2019 Table 3.2: Report of business results in 2020 Table 3.3: Summary of business results from 2018-2020 Table 3.4: Importing business profit of the company in the period of 2018- 2020 Table 3.5: Growth rate of revenue, costs and profit of the company's importing business in the period of 2018-2020 Table 3.6: Import profit ratio of the company in the period of 2018-2020 1 Table 3.7: Efficiency of using import working capital of the company 2018- 2020 Table 4.1: SWOT assessment of National Fortune company. - List of acronyms: ISEF: International Sicence and Economic Falcuty National Fortune Co.: National Fortune Trade & Technical Services company limitted. HR: Human Resources Iqs: Inquiries OEMs: Original Equipment Manufactures PO: Purchase Order 2 INTRODUCTION 1. Introduction to the research topic In 2020, the world economy in general and Vietnam's economy in particular experienced a heavy recession year due to the impact of the Covid-19 pandemic.
Up to now, the Covid-19 epidemic is still developing very complicatedly in many countries around the world, negatively affecting major economies such as the US, China, Japan, and the EU. In Vietnam, in the first 6 months of 2020, Covid-19 impacted the economy and made our country's economic growth drop to the lowest level in the past 10 years. The negative effects of the economic recession on Vietnam have caused domestic enterprises to face many difficulties and challenges, the import market of Vietnamese goods has been narrowed, exporting enterprises in the the country faces difficulties to reduce production scale. National Fortune Trading & Service Co., Ltd is not an exception.
During the internship at the company, through surveying, interviewing, collecting data sources, analyzing the characteristics of the situation of importing machinery and components of the company; I found the difficulties that the company encountered during the economic downturn was: Import costs increased, domestic demand for construction projects decreased, leading to revenue and profit from National Fortune's production and business activities also decreased. Recognizing the importance of these issues in helping business orientiation in current situation, combined with the theories acquired in the process of studying and learning in practice, I have chosen the topic "Solutions to improve importing business of National Fortune Trading & Technical Services Co., Ltd" to analyze the current situation of import activities in the context of the epidemic and propose some recommendations, solutions to boost the company's business performance through the difficult period. Research objects To be able to solve the above problems well, the research aim of the thesis is: - Overview of theoretical issues related to importing business along with basic theories about the efficiency of importing business of the Company. - Research, analyze and evaluate the status of import activities of National Fortune Company.
- Propose a number of solutions and recommendations to overcome the effects of the economic downturn and promote the import activities of the company in the coming time. Scope of the study Stemming from the practical situation of National Fortune Trading & Technical Services Co., the thesis defines the content and scope of research as follows: - Research scope on space: The thesis is proposed to study the current status of importing business of National Fortune Trading & Technical Services Co. - Research scope on time: Study the impact in the period from 2018 to 2020. And propose solutions to improve the efficiency of importing business for the Company from 2021 to 2025.
- Restrictions on business activities: Import activities - Research market limitation: Export market of heavy industry machinery and equipment in China, Europe and import market in Vietnam. Methodology - Secondary data collection methods: Materials obtained from sources available inside and outside the company such as: Financial statements for 3 years (2018-2018). 4 The company's website (https://www.vn) and publications and articles from many other sources such as gov. - Methods of data analysis + Statistical methods: Statistics from secondary data sources.
+ Comparative method: make statistical tables from which to show the difference in the company's business activities over the years, compare the achieved results with the set targets to give the achieved aspects. , not yet and the solution. Research subjects The topic studies the current status of import activities of National Fortune Trading & Technical Services Co., thereby proposing some solutions for the future. Thesis structure In addition to the introduction; table of contents; lists of tables, diagrams, figures, acronyms; and references; this study would be subdivided into for sections as below: - Chapter 1: "Theoretical framework of importing business".
- Chapter 2: "Current status of importing business of National Fortune Trading & Technical Services Co. - Chapter 3: "Evaluating the effectiveness of importing business of National Fortune Trading & Technical Services Co., Ltd" - Chapter 4: "Solutions and recommendations". 5 CHAPTER 1: THEORETICAL FRAMEWORK OF IMPORTING BUSINESS 1.1 General overview of importing business 1. The concept, characteristics and role of imports in international trade.
Import concept It can be defined that import is one of the two components of foreign trade activities, is an international business activity, is the process of exchanging goods between countries on the basis of the principle of parity exchange for currencies. It is not a single act of trade but a system of trade relations in the economy with both internal and external organizations.: Understanding National Accounts, Paris: OECD 2006, pp. 139-143) Therefore, import of enterprises is the activity of buying goods and services from abroad for domestic demand or re-exporting for the purpose of earning profit. So the essence of import is the purchase of goods from economic organizations, foreign companies and conducting consumption of imported goods in the domestic market or re-exporting with the purpose of making profits and connecting production with consumption.
Characteristics of importing business According to Lequiller, F; Blades, D., import of goods has the following characteristics: First, import has diverse market. Goods and services can be imported from many different countries. Based on the comparative advantage of different countries, enterprises have many opportunities to expand, narrow or change their import markets. 6 Second, inputs (sources of supply including imports) and outputs (customers) of enterprises are diverse, often changing according to the needs of domestic consumers.
Supply or output can be stable, concentrated or diversified depending on the company's business conditions, adaptation and meet market demand as well as supply fluctuations. Third, in the importing business, the parties use multiple payment methods, the use of which payment method is mutually agreed upon by the two parties, specified in the terms of the contract and in the importing business, importers often use strong foreign currencies, mainly USD, for payment. Forth, import is governed by many legal systems and procedures: Import activities involve many partners of different nationalities, so they are governed by the relevant legal systems and procedures of many different countries. Fifth, the exchange of information with partners must be carried out quickly through more modern technological means such as telex, fax.
Especially in the current information age, transactions via email and the modern internet are an effective tool for business. Sixth, modes of transportation: Import activities are directly related to foreign factors, goods are transported across national borders, have large volumes and are transported via sea, air, or road. iron and transported internally by vehicles with large tonnage. Therefore, import activities require large transportation costs, affecting business efficiency of enterprises.
The role of imports in international trade When a country's economy integrates into the world economy, the role of importing business becomes more and more important, which can be seen in particular: Imports expand domestic consumption, allow consumption of a larger quantity of goods than can be domestically produced, meet the increasing consumption demand as well as consumer tastes, increase the level of people's lives, increase national income. Import creates technology transfer, so that goods can be re-exported and expanded effectively, saving time and costs, creating a uniformity in domestic development.