INVESTMENT ECONOMICS PROJECT diet food for people who do workouts

About products to invest Diet Cookies, High-protein Milk, Greek Yogurt for people who do workouts: Diet Cookies Dietary biscuits act as a fast food before and after workouts to restore m

FOREIGN TRADE UNIVERSITYTHE FACULTY OF INTERNATIONAL ECONOMICS

INVESTMENT ECONOMICS PROJECT

Diet food for people who do workouts

Instructor Class Group Number

Hanoi, September 2019

TEAM MEMBER

TABLES OF CONTENTSPART I INTRODUCTION

I.1 About Us - Optimum Nutrition

I.2 About TH Milk JSC

I.3 About products to invest

PART II MARKET ANALYSIS

II.1 Overview of host country

II.2 SWOT Analysis of our company Optimum Nutrition

II.3 Customer demand analysis

II.4 Competitors

PART III PRODUCT “DIET FOOD AND BEVERAGE”

III.1 Business Model Canvas

PART IV FINANCIALS

IV.1 Strategy of setting price

Gullon Maria Diet Cookie

IV.2 Customer projection

IV.3 Cash flow and investment efficiency

3.4 Profitability of Investment (PI)

PART V SOCIAL BENEFITS

V.1 Physical Health Benefits

V.2 Mental Health and Social Health

V.3 Environmental Benefits

V.4 Employment benefits

PART VI References

PART I. INTRODUCTION

I.1. About Us - Optimum Nutrition

OPTIMUM NUTRITION was established in 1986 to satisfy consumer demand

for consistent quality in sports nutrition Our company is also known for anticipating changing customer needs and meeting the demands of a dynamic market with innovativeproducts

ever-Vietnamese Distributors:

- Starlite International Group (SIG)

- TRUONG THINH TRADING DEVELOPMENT JOINT STOCK COMPANY

- Khong the Tin Noi LLC

- BOCCI Vietnam

I.2. About TH Milk JSC

Company name: TH Milk Joint Stock Company

Address: No 166 Nguyen Thai Hoc Street, Quang Trung District, Vinh.

Hanoi City Branch: Floor 2, Dao Duy Anh Building, No 9 Dao Duy Anh Street, Dong

developing dairy farms in Northern border provinces (Ha Giang, Tuyen Quang, Lang Son, Thanh Hoa, …).

5 core principles of TH Milk JSC:

1. For true Happiness

2. For community health

3. 100% natural

4. Environment-friendly

5. Outstanding thinking and harmonious benefits

Successful projects by TH Milk JSC:

1. Clean TH Milk Road

2. Herbal Road

3. Healthy Beverage for Health Road

4. Vegetables and Food for Health

5. TH School Project

6. TH Health Care Project

I.3. About products to invest

Diet Cookies, High-protein Milk, Greek Yogurt for people who do workouts:

Diet Cookies

Dietary biscuits act as a fast food before and after workouts to restore muscle and providenutrients to the body, burning fat Protein and fiber-fortified bread thanks to its nutritiousnuts

High-protein Milk

High-Protein milk is an ideal food for the muscles of the exercise people who need a large amount of protein Milk is easier to drink and use than supplement foods like whey powder or meats.

Greek Yogurt

Greek yogurt is rich in protein and vitamins, sugar-free but still has a delicious taste It is especially recommended for exercise people rather than normal yogurts

PART II. MARKET ANALYSIS

II.1. Overview of host country

1.1. Economy growth and prospects

A mere 30 years ago, Vietnam remained one of the poorest countries in the worldrepresented by the poverty rate of nearly 60% and a poorly – functioning centrally plannedeconomy Thanks to the shift toward a market economy steered by “Doi Moi”, a series ofpolitical and economic reforms, today Vietnam’s dynamic transformation become aphenomenal highlight among the emerging markets and continues to show exceptionalgrowth rate in many years to come

Vietnam’s economy continues to show rocketing pickup in economic activity,backed by a cyclical rise in worldwide demand as well as a recovery in FDI and privatesector investment and a continuous change from traditional agriculture to more productiveand profitable manufacturing and service industries, demonstrating its attractiveness forfuture foreign investment Vietnam’s growth is projected to grow to 6.8% in 2019 withGDP per capita is expected to rise by 5.8% According to analysts from the World Bankand the think tank Brookings, Viet Nam’s economic rocket can be explained by three mainfactors: “First, it has embraced trade liberalization with gusto Second, it hascomplemented external liberalization with domestic reforms through deregulation andlowering the cost of doing business Finally, Viet Nam has invested heavily in human andphysical capital, predominantly through public investments.”

In the trend of globalization, Vietnam is in a strong position to benefit fromeconomic integration and participation in international trade organizations accompanied byfavorable trade agreements that are coming into force such as FTAs by ASEAN (1995),WTO (2007), CPTPP (2019) and various bilateral agreements with the U.S., Japan, SouthKorea, the EU (EVFTA), etc These trade agreements dramatically reduced tariffs andopened much of the economy to foreign investment Vietnam has been graduallyprogressing in enhancing its investment climate as shown by greater results in the WorldEconomic Forum’s competitiveness index (up five places to 55th in the world), and the

2018 World Bank’s ease of doing business ranking (69th around the globe, up 31 pointssince 2014) More than 10,000 foreign companies – including major global players

– operate in Vietnam these days, chiefly in export – oriented, labor – intensivemanufacturing, indebted to government’s initiatives aiming to ease administrativebureaucracy, reduce corporate income tax and adopt a more pro – investor approach

Vietnam has adjusted its demographic and social change through effectiveinvestment in its citizens Facing quickly growing population, Vietnam makes large publicinvestments in primary education, health care service and spends every effort to ensuretheir quality In terms of human capital index (HCI), Vietnam is ranked 48 out of 157countries and territories, second in ASEAN and only behind Singapore Infrastructure,especially power sector and connectivity, gains the most attention.

With a rapidly expanding middle class and massive tariff reductions from free tradeagreements, Vietnam is poised to experience significant growth in its health and wealthyindustry As a population that is increasingly health conscious, Vietnamese consumersrank health as their most important concern behind only their job and the economy.Therefore, consumption of low - fat dairy, for instance skim milk and low-fat varieties ofyogurt and cottage cheese, is anticipated to increase as customers become more conscious

of the need to remain healthy In 2010, the average Vietnamese person consumed about 15liters of milk/ year It is forecast that by 2020, this figure will nearly double, to reach 28liters of milk/ year/ person

Focusing on milk drinking behavior in Vietnam, in recent years, the demand formilk products has been increasing significantly Vietnamese government initiativesdesigned to boost the average height of citizens by encouraging milk consumption havecontributed significantly to the growth of the country's dairy products Sales of dairyproducts, which includes white milk, flavored milk, powdered milk and non – dairy milkalternatives, increased from VND 8 trillion ($379 million) in 2008 to VND 55.6 trillion($2.4 billion) in 2019 The market is expected to grow annually by 7.3% (CAGR 2019-2023), according to Statista.

Due to limited local production capacity, Vietnam’s industrial sector is still beingbuilt upon the import of raw material However, in the latest years, local leaders in dairyindustry including TH and Vinamilk have focused on creating raw materials with theestablishment of a large dairy cow farm fitted with sophisticated technologyimplementation, steering clear of foreign dependence According to the General StatisticsOffice's preliminary reports, in 2018, the total number of cows all over the countryreached 294.4 thousand, increasing by approximately 160 thousand of cows compared to

2010 with an average growth rate of 10.9% per year Characterized by its geography andtropical climate with an annual high level of temperature, Vietnam is capable of cowfarming Meadows in Ha Tay, Moc Chau, Ba Vi offer a variety of favorable conditions for

growing, feeding and breeding herbs As reported by the Department of LivestockProduction, Ministry of Agriculture and Rural Development, there has been a sharp rise inthe amount of dairy herds in the nation in recent years as big companies are increasinginvestment in manufacturing infrastructure to expand the scale of animal husbandry toguarantee the quality of raw milk sources aimed at providing customers with qualityproducts and food safety and to make use of raw milk as the primary input of material toserve the National School Milk Program Recognize the significance of raw milk fields,many companies have actively constructed on – site raw material regions withmanufacturing connections with cow farmers to guarantee dairy manufacturing safety,generate employment, decrease reliance on imported milk and dairy goods.

Many farms have received certificates from international organizations Farmingscheme meets global requirements: G.A.P, VietGAHP Organic farms to guarantee thatfood meets clean, global quality standards for consumers In addition, farm building hasconstructed businesses for dairy farmers connected with processing crops and milkcollection

When the supply has met the domestic market, in order to increase the room fordevelopment, dairy enterprises have chosen to export abroad, despite different marketapproaches According to statistics of the General Department of Customs, in the period of

2016 - 2018, Vietnam's export value of milk and dairy products continued to increase.Specifically, from USD 84.47 million in 2016 to USD 82.65 million in 2017 and USD129.68 million in 2018 Accordingly, the average export value of the whole growth period

is 27, 37% In the first 3 months of 2019, the export value of milk reached US $ 48.6million In particular, the main markets are Iraq, Hong Kong (China), mainland China,Afghanistan, the Philippines and some other countries such as UAE, Laos, Myanmar,Japan , as recorded by the Financial Times In addition to export, Vietnamese dairyenterprises also invest abroad, whereby Vinamilk invests in the dairy industry to the US,New Zealand, Cambodia, Poland, Laos and Myanmar continue to carry out tradepromotion to to the EU , Africa and South America; TH True Milk invested a project of

about 2.7 billion USD in Russia to produce and process milk Following the signing ofthe Vietnam-China Milk Export Protocol on 26 April 2019, eight companies haveregistered to export milk to China so far: Vinamilk, TH True Milk, Nestlé Vietnam,Nutifood, Ba For Milk, Enovi and Friesland Campina Vietnam…

Although it is undeniable that Vietnam dairy enterprises are put under a lot ofpressure due to heavy dependence on foreign markets, demanding requirements ofinvestment capital and technique, they are working hard on innovations to meet themarket’s demands with substantial initiatives Enterprises in the industry have beenconstantly investing, constructing, enhancing, innovating techniques and technologies thathave been implemented in factories over the previous few years There have been and will

be a number of big dairy producers and processors investing strongly in machinery,applying high-level automation technology at national and global level to enhanceproductivity, quality, food security, product diversification, maximize efficiency,competitiveness, and deepen the value chain of milk and dairy products on national andinternational markets

Source: CIA World FactbookThe combination of young population structure with the stable growth rate of GDP

as mentioned above plays an important role in promoting the consumption of milk To bemore specific, the table shows that the proportion of young adults from 20 to 39 years old

is the highest among age groups, which means that it is potential to invest into Vietnam asVietnam is in developing period with cornucopia of young labor as well as we could see apotential market of milk industry Furthermore, the fast growing of Vietnamese economybrings benefit to citizens By 2020, Vietnam’s annual income per capita is projected toreach 180 million (US$8568) This leads to not only increase in consumer spending, butalso in consumer behavior and preference – including a priority for branded goods andforeign products Additionally, in the specific case of milk industry, the higher GDP percapita, the more Vietnamese care about their health, especially the young adults concern

about their appearance, which implies the bright future of product for healthy and diet meal, which would be mentioned as our products.

The consumption level of milk of Vietnamese citizens is dramatically increasing Itwas 3.7kg/person in 1995, went up to 6kg/person in 2000 and in 2007, it was about12.3kg/person Until 2020, the average consumption level of milk is estimated to increase

to 20kg/person

Vietnam is one of the countries having a high level of economic growth in theworld since the purchasing ability rises gradually, consisting of milk and milk-relatedproduct These days, the average consumption level of Vietnamese is still lower than that

of Asian area (35kg/person) On the other hand, the production ability of the domesticfactories is not in position to meet the demand It is undeniable that the milk market inVietnam is in growing period Therefore, with the competitive advantage in technology of

a foreign company, we could be confident with our project

1.3. Political Stability

Vietnam has a strategic location as it is located in the center of ASEAN and alsoclose to the other big markets in Asian, especially China It long coast directly accesses toSouth China Sea and close to the main shipping routes of the world, which provide perfectconditions for commerce The political stability plays an indispensable role in economicdevelopment process in Vietnam, contributing to policies from the government The stablepolitical background assists Vietnam to be peaceful and prosperous

It is obvious that Vietnam is a developing country, which is encouraging the foreigndirect investment (FDI) from the foreign countries As a result, the Vietnamesegovernment established many preferable policies to attract FDI capital and promote theinvestment in areas or domains where the government directs the investment activities.Since Vietnam is in the process of transforming into market economy, investmentenvironment still remains disadvantages, namely less developed infrastructure,

insufficiency of uniformity in legal framework, the rate of unskilled labor is high.Therefore, the establishment and application of preferable policies to attract capital isnecessary to offset the existing limitations This is a good new for our company when wedecide to invest in Vietnam.

In terms of specific policies, the investment law in 2014 stipulated 13 groups ofdomains and 3 types of area to encourage investment and assigned the government tospecify the fields and eligible for tax incentives Accordingly, the specific level of taxincentives is prescribed in tax law The preferable regulations on attracting the FDI arespecified in the following legal documents:

Investment Law 2014

Law on Enterprise Income Tax amended 2013

Law on Export and Import Tax 2016

Decree No.118/2015/ND-CP of the government detailing and guiding the implementation

of a articles of the Investment Law

Decree No.123/2017/ND-CP amended a number of articles on collection of land use fees,collection of land rents and water surface rents

Decree No.57/2018/ND-CP on mechanisms and policies to encourage enterprises to invest

in agricultural and rural areas

Law on Non-agricultural Land Use 2010

Taking the result of these encouraging policies into account, in recent years, thereduction of the tax burden and diversification of tax incentives have contributed tocreating a favorable investment environment to attract FDI Over the past three decades,the FDI sector has played an increasingly important role in Vietnam’s economy Inconclusion, the current purpose of preferable and attractive policies of Vietnam is to

increase the FDI capital, contributing to promote economic development These resultsmust be logical reasons for Vietnamese government continue to attract FDI and establish

or amend the law to be suitable with foreign investment

II.2. SWOT Analysis of our company - Optimum Nutrition

- Strengths:

+ World’s Protein Powder Supplement Best Sellers since 1986 After more than 30years of development, Optimum Nutrition has become a leading brand in the world,always at the forefront of developing, researching and manufacturing high-quality,well-controlled, high quality sports nutrition products Optimum Nutrition is alsothe first brand to launch instant, easy-to-use powder products To date, OptimumNutrition's products have been distributed to more than 70 countries around theworld including Vietnam Accordingly, we can supply excellent materials for TH toproduce the diet foods

+ Wide range of products: whey, casein, plant, eggs, blended

+ Big market share: since we were the first fitness supplement brand in Vietnam since

2007, our products and brand have been popular with Vietnamese customers whileour company competitor Herbalife stepped in since 2009 and do not focus onexercising segment Other whey powder brands such as Combat and MuscleTechare newcomers and gain small market share due to low price

+ Knowledgeable and experienced staffs and fitness experts

+ Supply chain management and local know-how in Vietnam

+ Big investment fund and high-technology manufacture

+ Unawareness of general customers who do not do work-out Accordingly, our unique selling point is less worthier to them

+ High product prices compared to Vietnamese income level

+ Product samples are not available since the products take time to take effect

+ Marketing scale is not sufficient compared to other competitors’

+ Products are not widely sold in supermarkets and groceries

- Opportunities:

+ Cooperate with nutrition brands in Vietnam to co-produce unique diet

products sold in supermarkets and groceries

+ Stable demand for our products at the gyms, studios and fitness centers+ Good image in fitness community through education and sponsorship

+ Few competitors in the areas of diet instant foods

- Threats:

+ Poor sales due to unawareness of customers who do not do workout

+ Imitations in Vietnam market

II.3. Customer demand analysis

Vietnam is seeing more interest in gyms and other health-related services as eatinghabits change and signs of obesity emerge Staying healthy and fit is increasinglyimportant for both the young and old in Vietnam Rising disposable incomes andawareness of the benefits of a healthy lifestyle continue to drive the industry forward.3.1. Overall and customer demographics

Vietnam now accounts for the largest portion (30 percent) of all fitness facilitiesamong the six major members of the ASEAN.Data from Germany-based market researchfirm Statista showed that the revenue in the Vietnamese fitness segment could amount to

$60 million in 2019 and is expected to show an annual growth rate of 7.4 per cent,resulting in a market volume of $80 million by 2023 The fitness market’s largest segment

is wearables with a market volume of $49 million in 2019 In Southeast Asia, Vietnam hasthe highest percentage of household GDP spent annually on health and fitness

Fitness customers are characterized as the younger population with highwillingness to pay, so long as the quality is ensured Among those responded to a researchreport on fitness conducted by Q&Me, the majority of the fitness-concerned are from 16 to

34 years old, who should be able to adopt new trends and new products fairly rapidly Inaddition, their household income falls mostly on from VND14mn and above All of

these demographic factors pave the way for fitness complimentary products to develop and become familiar.

The fitness-concerned by age group, Q&Me

The fitness-concerned by income levels, Q&Me

3.2. Health consciousness and dietary choice

The rising market size of fitness products is driven by consumers’ high health consciousness In Vietnam, it has been witnessed that the obesity rate has increased over

the past five years The obesity rate has grown at a CAGR of 8.4% during the period2013-2018 In the future it is anticipated that obesity will reach 3.6% by the year 2023 Onthe flip side, the research by Q&Me showed that 79% of people care about their bodyshapes, and 53% think they are fat in some way They have been taken measures tomaintain or enhance their health, as shown in the graph below.

Choices of health maintaining activities, Q&Me

As observed, apart from the normal convention of maintaining health by refrainingfrom smoking and alcohol, drinking more water, and sleeping better, more than half ofpeople have taken up exercises and diet Specifically, people tend to have more of theingredients below in their diet

Choices of dietary foods, Q&Me

Fruits and vegetables understandably topped the chart, both at more than doublingthe 3rd highest (salad), as they generally offer lower carb contents and various necessaryvitamins that are not found much in basic meals Special food for diet stood at a modest9.1%; however, it showed that there is still room for the development of this sector Wecan look at the top ingredients and study their nutrients in order to apply those into ourproducts, offering high-quality dietary dairy foods that are still rare in Vietnamese market

II.4. Competitors

4.1. Current products:

NESTLÉ FITNESSE BREAKFAST CAKE FOR DIETERS: is a nutritional

supplement that includes vitamins, proteins, fats, minerals, and energy that are calibrated

to suit the daily nutritional needs of the user The processed product is very convenient

Made from whole grains - the world's favorite food for breakfast for every family.Cakes also contain important ingredients for nutritional balance, such as dried fruits likepapaya, grapes, pineapples, etc.

Good for diet: rich in dietary fiber, helping to fill for long without craving for snacks should be suitable for those who need to lose weight Bread also helps prevent cardiovascular disease, colon cancer and diabetes effectively In addition, the product also contains many vitamins E, B2, B3, B6 and folic acid; Iron, zinc and calcium minerals are necessary for daily meals, helping to improve health

Delicious taste, helps diets to be effective: has a delicious taste, does not cause boredom, so they can be eaten regularly in many meals throughout the day You can

consume 2 servings daily in the morning and evening (each serving includes 40gam

Fitnesse & Fruit + 125ml of low-fat low-fat milk), combined with a high-fiber diet and regular exercise Achieve weight loss effect in a short time

DIABET CARE: is a premium product providing special nutrition for people with diabetes and pre-diabetes

The product does not contain Gluten and Cholesterol.

Stable blood sugar: Isomaltulose is a kind of powdered sugar that is digested and absorbed slowly into the body, does not increase blood sugar suddenly, helps maintain stable blood sugar

Increasing resistance: vitamins A, E, C, Zn are important components that help the body enhance resistance, fight the attack of pathogenic bacteria to help the body stay healthy, limit the progression developing complications of diabetes

Good for the heart: MUFA, PUFA are essential unsaturated fatty acids that help reduce cholesterol & triglyceride levels in the blood, control arthritis, inflammation,

blood pressure, reduce the risk of cardiovascular disease

Good absorption:FOS / Inulin slows down the absorption of sugar into the

bloodstream, while helping the digestive system function healthy and absorb nutrients

VINAMILK GREEK YOGHURT

Vinamilk Greek Yoghurt is a calcium supplement solution for women because each 100g yogurt box contains 160mg of calcium, equivalent to the amount of calcium in 1kg of beef or 4 boiled eggs With a refreshing, delicious taste, Vinamilk Greek yogurt is suitable for making nutritious desserts, or complemented with meals before and after training!

4.2. Current suppliers

NESTLÉ VIETNAM

Nestle, the world's largest food and beverage company, is headquartered in Vevey, Switzerland Nestlé's current products range from mineral water, baby food, coffee and dairy products

In the 1860s, pharmacist Henri Nestlé invented a food for babies who could not be breastfed His first success was to save a premature baby who could not be breastfed or other conventional alternatives The value of this new product was quickly recognized since the new Nestlé formula saved the life of a premature baby Since then, Farine LactéeHenrie Nestlé milk powder has been widely sold in Europe

Nestlé's first sales office in Saigon was established in 1912 Here are some

milestones of the company's rapid development in Vietnam:

1992: La Vie Company, a joint venture between Perrier Vittel of Nestlé and a trading company of Long An was established

1993: Nestlé officially returns to Vietnam and opens a representative office in Ho Chi Minh City

1995: Nestlé Vietnam was born Officially started construction of Dong Nai factory

2002: La La's second factory was put into operation in Hung Yen

2007: Dielthem was selected as the official distributor for chocolate and confectionery products

2008: Establishment of Special Nutrition Division

2011: In August, Tri An factory was built, in November the Binh An factory (Gannon) was bought in Dong Nai

2013: Nestlé Vietnam inaugurated a new NESCAFÉ factory in Amata Industrial Park, Dong Nai

2013: Nestlé Vietnam's main office moved to a new location at Level 5, Empress Tower, District 1 from September

10/2014: Nestlé inaugurated a factory worth US $ 37 million at Nestlé Binh An factory

NUTIFOOD VIETNAM

In 1989: Medicinal Research Station changed to Ho Chi Minh City Nutrition Center, Dong Tam Complex became Dong Tam Food Base, where applied the research topics of nutrition experts to produce anti-malnutrition products for children and feeding patients

in hospitals The typical product of this period is Enalaz - the first gastric tube feeding food in Vietnam, contributing to supporting the treatment of serious patients at hospitals across the country at a price equal to 1/10 of the product imported products

March 29, 2000: Stemming from the success of research and clinical applications of the City Nutrition Center City, Dong Tam Nutrition Food Joint Stock Company (original name of NutiFood) was established

2001: Products of Dong Tam Nutrition Food Joint Stock Company were voted by the Vietnamese consumers into the Top 5 Vietnamese high quality products continuously in the following years

In 2006 , the NutiFood Binh Duong Factory expanded (powdered milk + liquid milk) was certified to meet GMP standards of food, HACCP standards and continuously in the

following years

In 2008 , NutiFood became a public joint stock company and successfully IPOed in the stock market.

In 2010 , signed a cooperation agreement with ABS-QE USA to build and monitor the Quality Management System and to extend it up to date.Joining the Market Stabilization Program of the City HCM - Program of Vietnamese goods to the countryside

compete internationally NutiFood nutritionist and chef for the first time

accompanied Vietnamese U 19 players to international competitions until the end

of 2014, creating the attention of the public

Year 2014

● Signed with Hoang Anh Gia Lai Group in the 120,000 Dairy Project

● Began construction of NutiFood Highlands Plant at Tra Da Industrial Park, Ho Chi Minh City Pleiku has a processing capacity of 500 million liters of milk / year

In 2015

● Began construction of NutiFood Vietnam Factory in Kien Khe Industrial Cluster,

Ha Nam with a processing capacity of 200 million liters of fresh milk and 31,000tons of powdered milk, the largest factory in the North

VINAMILK

Vinamilk is the largest dairy company in Vietnam Based on the UNDP 2007 Top

200 largest firms in Vietnam report, it is also the 15th largest company in Vietnam and the most valuable public company listed in Vietnam In 2010, it is the first company in

Vietnam to be included in the Forbes Asia's 200 Best Under A Billion list that highlights

200 top-performing small- and mid-sized companies with annual revenue under US$1 billion

The company was established in 1976 as the state-owned Southern Coffee-Dairy Company, to nationalize and take over the operations of three previously private dairy factories in South Vietnam: Thống Nhất (belonging to a Chinese company), Trường Thọ (formerly owned by Friesland Foods, best known for its production of condensed milk that was widely distributed across the South) and Dielac (Nestlé) It was renamed United Enterprises of Milk Coffee Cookies and Candies in 1978 It became the Vietnam Dairy Company, formally established in 1993 In 2003, following its IPO to the Ho Chi Minh Stock Exchange, the company legally changed its name to Vietnam Dairy Products Joint Stock Company (Vinamilk) The principal activities of the Vinamilk are to produce and distribute condensed milk, powdered milk, fresh milk, soya milk, yogurts, ice-cream, cheese, fruit juice, coffee and other products derived from milk

Vinamilk products such as powdered milk and condensed milk are also exported to the Middle East, Cambodia, the Philippines and Australia Exports accounted for $180m in

2012 Vinamilk’ main competitors are Dutch Lady Vietnam (a division of Friesland

Foods), Nestlé Vietnam, Abbott, Mead Johnson, Friso and Nutifood In September 2016 Vinamilk signed a strategic cooperation agreement with Chr Hansen to develop

probiotics

4.3 Incompetence of competitors

VINAMILK

Unable to take initiative in the source of raw materials: The source of raw

materials has not been proactively dependent on imported raw materials (60%) so input costs are strongly influenced by world milk prices and exchange rate fluctuations

Vinamilk has good Greek yogurt products, but the poor marketing has not created

an effective message to promote to consumers Vinamilk has not had any message yet for consumers to understand the difference between Greek yogurt and other yogurt products

on the market In another hand, Greek yogurt still contains abundant sugar amount

compared to standard Greek Yogurt

NESTLÉ VIETNAM

Focus on general nutrition demand and the products are not qualified for particular purposes

NUTIFOOD VIETNAM

The cost of product development and communication is huge

The company is also hard to satisfy customers when offering promotions that are not reasonable, effective, puzzling and discriminatory against customers

The image has not yet been widely disseminated, compared to other companies in the same industry Products do not make a big difference

Image ads are not really outstanding, lacking competitiveness with other brands.Products are mainly for children and elderly which contain no fresh milk (only milk powder and condensed milk) and too much sugar added

PART III. PRODUCT “DIET FOOD AND BEVERAGE”

III.1. Business Model Canvas

1.1. Customer Segment

- Consumers (who are interested in healthy diet or do workout)

- Distributors (supermarket, retail chains, )

- Fitness Centers

1.2. Value Propositions

- Nutritious food for people who do workout

- Fast meal with energy sufficiency for people who are busy (students, officers,.)

- Nutritional supplements from daily products for diet people

1.3. Channels

- TH Store Chains

- Supermarket (VinMart, VinMart +, Big C)

- Convenience store (Circle K, Family Mart, 7 Eleven)

- Agency & Retail store

- Social Network, TV Ads, KOLs, POS Marketing, Event

1.4. Customer Relationship

- Customer service system (Hotline, Email, Fanpage)

- Feedback/ report from retail chains/ distributors

1.5. Revenue Stream

Product sales:

- Direct from customers

- Indirect through distributors

- Regulatory Compliance

1.7. Key Resources

- Infrastructure: TH Farm, TH Milk Factory, TH Store

- Partners & Retail Network

- Human Resources: Nutritionists, Scientists,…

III.2. Demographic

Demography

Incentives to

consume

Customer: Anyone who is interested in fitness and diet

Gender: Male and FemaleAge: 16-34

Household Income: 14 million VND/month and aboveLocation: Big cities (Hanoi, HCMC, Da Nang, )Lifestyle: Active, energetic

Hobbie: Engage in fitness activitiesHighly concern about health and nutrition

Intend to lose/maintain weight or stay in shape

Following a special diet

Demand for special food to support work-out activities

III.3. PRODUCT DETAILS

3.1. Functions

● Instant supply of energy after a hard-working day or after the gym

● Products made in form of healthy snack food so they help satiate the appetite of those who keep fit and want to stay in shape They still have something at hand to nibble when they are hungry or long time do not have cookies