QUALITY MANAGEMENT REPORT realizing the need to buy and read books for vietnamese consumers

House of quality Figure 3.6 Net Promoter Score of Tiki, Lazada, Sendo and Shopee Nielsen, 2019 Figure 3.7... Currently, Tiki is associated with the B2B2C model, which means customers can

VIETNAM NATIONAL UNIVERSITY HO CHI MINH CITY

INTERNATIONAL UNIVERSITY SCHOOL OF INDUSTRIAL ENGINEERING AND MANAGEMENT

QUALITY MANAGEMENT

REPORT

Instructor: Duong Vo Nhi Anh

Students name:

Table of Contents

I COMPANY OVERVIEW: 4

A History 4

B Business size 4

C Product line 4

D Competitors 4

E Organization structure 4

F Brief summary of all the departments 5

G SWOT analysis 5

1 S (Strengths) 5

2 W (Weaknesses) 6

3 O (Opportunities) 6

4 T (Threat): 6

H House of quality 7

1 Competitors 7

2 Voice of customers 8

3 House of quality (HOQ) 9

4 Problems Identification 12

II Solutions – The Juran Trilogy 12

A Quality Planning 12

B Quality Control 13

C Quality Improvement 13

III CONTRIBUTION : 13

IV REFERENCES: 15

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Table of Figures

N

o

1

2

3

4

5

6

7

8

List of Acronyms

Name of Figure Figure 1: Organization Structure Figure 3.1 Most visited e-commerce platforms in SEA 2018

Figure 3.2 Ecommerce Enterprise Market Share in Quarter 2, 2019 (iprice Insights, 2019)

Figure 3.3 Most popular Pre-purchase factor (Younet Media, 2018)

Figure 3.4 Most popular Post-purchase factor (Younet Media, 2018)

Figure 3.5 House of quality

Figure 3.6 Net Promoter Score of Tiki, Lazada, Sendo and Shopee (Nielsen, 2019)

Figure 3.7 Number of Sellers on Tiki, Shopee and Lazada

in 2018

Pag

e 6 10 11 12 13 15 16

17

o

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I COMPANY OVERVIEW:

Tiki (abbr for “Tìm kiếm & Tiết kiệm,” which means “Search & Save”) is the fastest and

most trusted B2B2C E-commerce platform in Vietnam Tiki is well-known for its unique

TikiNow service (2-Hour Delivery) and reputable customer service

Realizing the need to buy and read books for Vietnamese consumers, Mr Tran Ngoc Thai Son – Tiki’s founder thought of a tool to help people buy books more easily In 2010, the starting

capital for him to open the company with Tiki.vn with only US $5,000 of his own savings

The business is on the process of market expansion and domination with the rising number of

employees from its foundation The total number of staffs is approximately 2000 from all sectors and departments Tiki’s development can be seen in the rising scale of cargo handling centers

After 6 years since 2013, Tiki now has 10 cargo handling centers in big cities, total area of

60,000m2, 30 times bigger in scale compared to before

In the E-commerce market, Tiki is one of the few businesses focusing on regular investment

every year to expand the supply chain From there, the goods spread to branches, enough to

serve the surrounding localities Warehouses in Hanoi and Hai Phong serving the Northern area,

Da Nang and Nha Trang markets for the Central, Ho Chi Minh City and Can Tho will be the

focal points for the Southern area

The main product lines include Books, Phones and Tablets, Electronics Devices, Home Appliances,

Health and Beauty, Office Supplies, Toys and Souvenirs, Mom and Baby and Sports Up to now, Tiki is famous for its successful Books supplies with good services and products.

After the period fighting for its name in the market when it comes to the first two elements, since

2014 Tiki has endeavored to focus on the third one The market is very lack of reliability in the form of online transactions, Tiki indicates that gaining customers’ trust is the key factor leading

to victory Local investors always have the advantage of understanding the customers' needs and devise more realistic strategies Therefore, Tiki has not rushed into investing in C2C model as

some competitors Currently, Tiki is associated with the B2B2C model, which means customers can register to open a store on Tiki to sell like other e-commerce platforms such as Lazada,

Sendo, Adayroi, etc

Board of Director s

Brand and Communication

Finance, Accounting and Legal

Supply Chain

Customer Relationship

Commercial

Engineering

People Operationn

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Figure 1: Organization Structure

F Brief summary of all the departments

Board of Directors are responsible for setting up corporate policies and monitoring each

departments’ manager, supervising the performance indexes Their mission is also to

establish management policies and making major strategic decisions

Brand and Communication function is in charge of communications, marketing and public

relation activities as well as campaigns

Supply Chain is important for the entirely supply chain operations and planning with scope

of procurement, inventory, fulfilment and delivery

Engineering: Software engineers, web developers and data scientists are responsible for

the excellence of technology infrastructure, especially the internal system

Commercial department is responsible for retail and business developments for both Tiki

and stakeholders Their scope of work is business and market development plans as well

as coordination with supply partners

Finance, Accounting and Legal is functional of advising the company directors/managers and

implementing the following roles: accounting of assets, equity, payables and expenditure,

reporting financial plans, supervising the management and compliance with the business regime

Long history of formation:

Tiki is a business in e-commerce industry established in 2010, with a long history of business

operations, Tiki has created trust for customers and is one of the first choices among

commercial exchanges electronic

Good brand identity:

With the initial starting point of mainly dealing in online books, after 9 years of operation, Tiki.vn has now become a multi-industry online retailer with 15 basic consumer goods categories, which books are still a good product "identity" for the brand of the business

Convenient product:

In terms of belief, 85% of customers are satisfied with the quality and service of Tiki With

400,000 monthly shoppers at Tiki, the return / exchange rate is only 0.95%

Return policy as prescribed, creating favorable conditions for buyers

Large, fast distribution network:

Tiki has built and implemented its unique selling point (USP) with fast delivery service with an average nationwide delivery time of only 1.6 days, allowing customers to receive goods in 2

hours in Ha Noi and Ho Chi Minh city, ensuring the quality of goods when it reaches the user

From May to October, the company has invested a lot of resources in opening 6 more warehouses, bringing the total number of warehouses nationwide to 8 warehouses, including Ho Chi Minh City HCM with 3 warehouses; Ha Noi, Hai Phong, Da Nang, Nha Trang and Can Tho with 1 warehouse in each city

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Catching up with trends and customer needs, constantly changing themselves to interact well

with customers:

Tiki is constantly launching special promotions and communications to promote awareness

of diversity, especially in household products and technology

Losses for the increasing trend over the years:

According to the financial report of Tiki Joint Stock Company, this enterprise recorded an

accumulated loss of nearly 308 billion Dong at the end of 2016 If calculating the loss of

282 billion dong in VNG's 2017 annual report, the accumulated loss of This e-commerce

site has reached nearly 600 billion VND after 7 years of operation

Limited product diversity:

Compared to its competitors, Tiki is claimed to be lack of product selections variety as

customers have fewer choice of a specific product or some products are only available on

other ecommerce sites

Marketplace brings great potential to Tiki:

Businesses can actively coordinate with Tiki to make marketing and boost sales However, the

quality must still be controlled by Tiki's supply chain system In this way, Tiki can control the

quality of input, and possibly through businesses to resonate for their e-commerce platform.

Internet users in Vietnam is high:

On average, Vietnamese people use the Internet for up to 4 hours a day This is a great

opportunity to grow your online business

Rising demand of shopping online:

With the rapid development of online business, consumers are increasingly buying online, which is a

great opportunity for the development of Tiki in particular and e-commerce in general.

Great resonance from Google, Facebook:

Tiki works with Google as a Tet City, and a few years ago with Facebook Facebook has a

Facebook store Every year, Tiki will send their employees to Facebook headquarters It helps

them to build a customer database This is a big project of Tiki to understand customers better, help them have the right choice

Strong competitors:

For the development of e-commerce market, Tiki has many strong competitors like

Lazada, Shopee, Sendo

Marketplace policy:

The Marketplace offers a great opportunity for Tiki's new development, but this is also a

big challenge for the quality of product inputs, traceability and building trust with

customers when implementing the marketplace model

Online business form:

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Although the online purchase is growing strongly, many fake and fraudulent purchases have

created a cautious trend when not being checked

High selling cost:

E-commerce is a relatively new form of sales in Vietnam, so the cost to maintain pages,

warehouses and customer support is very high While the risk of customers ordering but not

receiving goods is still very large, businesses must bear all the costs due to the return of goods, the quality of goods through many stages of transportation is difficult to ensure quality

H House of quality

In the House of quality to define the underlying problem, competitors analysis was thoroughly

taken to measure the company performance in the objective comparison We have collected

some statistics illustrating the ecommerce market generally to positioning Tiki’s share

Figure 3.1 Most visited e-commerce platforms in SEA 2018 (iprice Insights, 2018)

According to the number in 2018, The e-commerce competition in Vietnam is currently being

shaped by 4 big names: Shopee, Tiki, Lazada, Sendo and other specialized product specification ones Most of them have been developed the combined model of B2C and C2C While Lazada and Shopee are 2 enterprises with foreign capital, Tiki and Sendo were founded by domestic

organizations In the first quarter of 2018, Lazada maintained to be the market leader in terms of both the number of website visits and the number of views on Facebook Nevertheless, a year

later, Shopee and Tiki rose to No 1 and No.2 respectively, while Sendo ranked 4th as the results

of its continuous development (iprice Insights, 2018).

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ECOMMERCE ENTERPRISE MARKET SHARE

BY VISITS

Shopee Tiki Lazada Sendo Others

Figure 3.2 Ecommerce Enterprise Market Share in Quarter 2, 2019 (iprice Insights, 2019)

Further assumptions were made on market positioning by application or websites visits, Shopee and Lazada were chosen as the two competitors on account of aiming the same goals as the

market leader and performance similarities Some quick information of the 2 competitors are

introduced as below:

Shopee was established in 2015 to provide users with an easy, safe and fast experience when

shopping online through a strong billing and operational support system The original model

of Shopee Vietnam was C2C Marketplace – where it played as an intermediation in the

buying and selling process among sellers However, Shopee Vietnam has now become a

hybrid B2C model with the introduction of Shopee Mall

Lazada.vn is a member of the Lazada Group, which is considered to be the first online shopping

center of Southeast Asia and is now presented in Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam Lazada is an exchange ecommerce providing products across multiple industries such as

furniture, phones, tablets, fashion and accessories, health care, beauty, toys and sport equipment

Currently, Lazada has become a subsidiary of Alibaba with 90% of share capital.

With the purpose of clarifying the customer requirements in the House of Quality, we have use the survey of YounetMedia that was collected to identify the most significant buying behavior

of customer, we have collected the voice of customers on before giving buying decision and

after buying phase on Ecommerce website

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MOST POPULAR PRE-PURCHASE FACTOR

Others 4.90%

Promotions 9.20%

Figure 3.3 Most popular Pre-purchase factor (Younet Media, 2018)

MOST POPULAR POST-PURCHASE FACTOR

Figure 3.4 Most popular Post-purchase factor (Younet Media, 2018)

Some factors are mentioned such as price, information of products, quality of products, etc

Understanding what influences the purchasing decision will help the business to better

understand what is important to consumers when they shop online After considering the

statistics, we came up with the justified customer voices in the assessment model based on

dominant factors: Price, Product-related, Quality, Shipment- related and Customer Service We

also choose product diversity or product selections as one of the demanding factor as

Ecommerce platforms are striving to increase this factor to retain loyal customers and prevent

them from purchasing unavailable products on competitor’s websites

After researching these factors, some technical requirements are introduced to build a HOQ,

which helps our team to find the core problem effectively

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Figure 3.5 House of quality

In House of quality, there are some notable voices of customers like products selections, price, quality of product, shipping cost, etc to show the desire to the products of customers

Furthermore, this HOQ has many technical features such as discount events, training staffs,

customer service, commitments, etc, which can be converted into business benefits that are

meaningful to executives Tiki, Shopee and Lazada are prepared in detailed comparison in this table to identify the strengths and weaknesses of those companies Competitive evaluation is

illustrated for the explanation For example, Tiki has the highest scores in high quality of

product while Shopee has the lowest Because of that, Shopee should improve their product’s

quality by making target and conducting deployment

Shopee with its C2C model strategy focus, it has relatively simple and quick process to register

as a Seller on the platform: email, phone authentication and others setup On the contrary, Tiki intensively controls and qualifies the capabilities of Suppliers and Sellers (product origins,

business license, authentic brand, etc) by acquiring verified documentations Therefore, this

policy of Tiki has restricted the variety of supply source as well as the product range

selection However, Tiki in reverse wins the market with regard to quality, reliability with

impressive number in Net Promoter Score (NPS) conducted by Nielsen NPS is the index

measuring customer experience and satisfactory of a brand

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