FINAL REPORT hải hà COMPANY marketing channel of hải hà

About company ● Hai Ha Confectionery Joint Stock Company HAIHACO is one of the largest confectionery manufacturers in Vietnam.. Today, the company has developed into Hai Ha Confectionery

UNIVERSITY OF ECONOMICS AND FINANCE

-FINAL REPORT: HẢI HÀ COMPANY

LECTURER: NGUYỄN THỊ NGỌC DUNG

TABLE OF CONTENTS:

1 About Hai Ha Company (HAIHACO)

2 Product lines

3 Hai Ha’s competitors

4 Current distribution system

II. MARKETING CHANNEL SYSTEM ANALYSIS:

1 Define service output and categorize end-users: Service output demand of end-users and segmentation

2 Marketing channel of Hải Hà:

2.1 Current distribution channel diagram and channel members

2.2 Functions of channel members

2.3 Efficiency template

III DEFINE GAP ANALYSIS:

1 Conclusion Service gap

2 Conclusion Cost gap

3 Conclusion of common problems faced by distribution channels

IV MAKE OR BUY DECISION

1 What percentage of the distribution channel Hai Ha has – how much % Buy or both ?

V STRATEGIC PLAN:

1 Strategic for problem 1

2 Strategic for problem 2

3 Strategic for problem 3

VI REFERENCE (according to APA standard)

I INTRODUCE

1 About company

● Hai Ha Confectionery Joint Stock Company (HAIHACO) is one of the largest

confectionery manufacturers in Vietnam

● The company was established in 1960, has spent more than 50 years of striving and growing up The company has continuously grown, accumulated a lot of experience in

production and business

● The predecessor was a small factory with a capacity of 2000 tons/year Today, the company has developed into Hai Ha Confectionery Joint Stock Company with a production scale

● Main business activities include:

- Producing and trading in confectionery and food processing

- Import and export business: raw materials, machinery and equipment, specialized products, consumer goods and other goods

- Investing in construction, leasing offices, houses, and commercial centers.

2 Product lines

3 Competitors

- This is a big competitor of Hai Ha in the North market, with an investment capital of overVND 60 billion and an annual output of about 6000 tons In recent years, Hai Chau company haspaid great attention to the issue of diversification and improvement of product quality The company has invested 5 billion dong to import the production line of chocolate-covered sponge cake from Germany and the Netherlands, and at the same time, innovated the management method and reorganized the distribution network across the country Main products are fresh cakes, savory cakes, snack cakes, …

- This company is considered as the main competitor of Hai Ha Company in the Mien Nammarket Bibica confectionery company has imported a series of equipment from France, Italy, producing many kinds of chocolate confectionery products, hard candies, marshmallows, Jelly, etc The competition is quite strong with Hai Ha's products in terms of product price Bibica confectionery companies also have the advantage of producing sugar, which is the main raw material for making confectionery, so the input price of Bibica is lower than that of Hai Ha On the other hand, these companies are not taxed on sugar products used to make confectionery Therefore, the price of Bibica is lower

4 Current distribution system:

- HAIHACO has 03 production factories with modern production lines, applying the ISO

22000 quality management system to ensure the standards of food hygiene and safety, protectingthe health of consumers and having a capacity up to 20,000 tons of

confectionery products per year - Hai Ha Confectionery Factory is located in VSIP Bac Ninh Industrial Park This is the new and most modern factory of HAIHACO, equipped with many modern production lines along with a team of skilled workers, a large

warehouse, the factory fully meets the criteria of green production clean, beautiful, safe, fire prevention and environmental protection - Hai Ha 1 Confectionery Factory is located at Lac Long Quan Street - Tien Cat Ward - Viet Tri City - Phu Tho - Hai Ha 2 Confectionery Factory is located at No 3 Thanh Binh Street - Ha Long Ward - Nam Dinh City - Nam Dinh

- The company has 02 dependent accounting branches in Da Nang and Ho Chi Minh to serve the consumption of the Company's products:

 Da Nang branch is located at 134 Phan Thanh - Thac Gian Ward - Thanh KheDistrict - Da Nang With the function of serving the consumption of the Company's products in theCentral and Central Highlands markets

 Ho Chi Minh branch is headquartered at Lot 27 Tan Tao Industrial Park, Tan Tao Street - Tan Tao A Ward - Binh Tan District - Ho Chi Minh City With the function of serving the consumption of the Company's products in the Southern market

II MARKETING CHANNEL SYSTEM ANALYSIS

1 Define service output and segmentation:

Segment Bulk - Spatial Delivery / Assortment/ Customer service Information

descriptor

1 Bulk “I want to “I want to order “ I want the “ I can choose “I want not only “I would like to

buyers buy in bulk to online and the product I from a variety of to buy the know more

serve my product will be ordered to be brands in terms of product, but also about thecustomers ” delivered to my delivered the weight, design, to have a great brand's

LOW address ” same day or flavor and price of experience in promotions or

MEDIUM as soon as each product to terms of sales new product

possible” suit my own service and launches.”

MEDIUM purposes.” promotions when HIGH

HIGH

HIGH

2 Marketing channel of Hải Hà:

2.1 Current distribution channel map of Hai Ha:

 In Hanoi, Hai Ha Confectionery Joint Stock Company has 5 warehouses of finished products and 7 warehouses of production materials

 The distribution channel structure of Hai Ha:

 Direct channel: Manufacturers distribute directly to consumers through the company's store form (Kotobuki) or order directly through e-commerce platforms such as Tik Tok shop, official Shopee by Hai Ha.

 Tie 1 channel: In this channel, the company will distribute products to big supermarkets such asMetro, bigC, G7, Supermarkets will directly place orders with the company through staff in charge of the area.management company

 Tie 2 channel: This is the main channel used, the distribution of products is done through

wholesalers to retailers and then to consumers Products are transported from the factory warehouse via trucks to dealers in the provinces after confirming the order from the market staff in charge

2.2 Channel functions

Physical Possession - Hai Ha currently has - Retailers when Customers buy Hai

3 production factories ordering from Ha's products at retaillocated in Bac Ninh, wholesalers, the points on the market or

Dinh Products will be be paid by the official e-commerce

the payment ratefor transportation

at supermarkets:

2800 VND/carton

by motorbike, 1000VND/carton by thecompany's

transport vehicle

purchased by thedistributor andowns the goods

at the warehouse

Promotion - Hai Ha has printed - Major retailers -For customers who

advertisements on the (supermarkets, Hai buy Hai Hacompany's trucks, but Ha's Kotobuki confectionery with an

the paint layers are old chain stores, ) invoice of over 7and peeling, no longer have preferential million VND, they will

quarterly sales willreceive additional tradediscounts from 0.3% -0.7% of sales

- Hai Ha has preferential policies for retailers:

wholesaler and the certain level, such

stipulates the discount points, bonus

manufacturer to the on each box, gifts

wholesaler, the gifts, If retailerswholesaler must fulfill do not fulfill theirthe obligation to sell commitment tothe product to satisfy display, the market

the company's area

- The contract is signed will, if discovered,for a period of 1 year, cut all bonuses as

so when the contract is promised instill valid, either party advance

who breaks thecontract will have tobear full responsibilityand be fined

Financing - Hai Ha helps agents - Wholesalers - When buying in bulk,

by allowing them to pay for the there will be a discountpay late for a shipment display at from the retailer

immediately to receive - Dealers andgoods, in some cases supermarkets,the maximum debt and large-scalelevel does not exceed selling points are

120 million If the old supported with

debt is more than 15 racks and

products

Risking - Whether the company - In the event of - Retailer if selling - Less risk because

gives priority to the an error on the slowly, products in reaching the end-usersagent returning the part of the stock if near term all have 3rd partygoods, the company wholesaler, the can be exchanged intermediaries, whichmust determine if this wholesaler bears at the distributor are responsible e-

is really a difficult the full cost of commerce platforms product to sell on the return shipping

market If it's hard tosell on the market,allow them to return100% of the originalvalue

- Duringtransportation, loadingand unloading if thegoods are broken ordamaged If it is thefault of the badshipping, the companyhas to bear the wholecost, or if it is the fault

of the distributors, theybear the loss caused by

Ordering - Wholesalers place Dealers order - Enter goods in Consumers buy goods

orders via email, fax directly with the batches and notify online on Shopee, Tikwith the Sales local market the quantity to be Tok Shop or wholesaleSupervisor (SS) in staff Orders are imported before and retail points.charge Purchase shipped to Retailers do not

orders are forwarded to distributors cost to orderSales Admin (SA) and

DistributionManagement System(DMS)

- Or call the Companydirectly at: 043 621

0074 to order

Payment - The company makes - The company Cash - No payment Allow customers to

payments through makes payments fees pay by cash or

Payment fee according Payment fee Debit/Bank transfer, e-wallets…

to bank policy according to Transfer by Credit

bank policy Card

Do not accept debt - Agents pay

immediately Payment feeupon receipt of according to thegoods, in some bank's policycases, the

maximum debtlevel does not

exceed 120million.

Information - Information for Receive customer Customers respond

Sharing retailers about feedback directly directly to sellers at

promotions or from feedback retail outlets or through

on Shopee, Lazada, Hai Ha's official

shop, when there is aproblem

profit share

3.2.1 Identify channel gaps:

Service gap:

Segment Bulk Spatial Delivery/ Assortment/ Customer Informatio Major Channel

breaking Convenience Waiting Variety Service n Sharing

time

Small

Buyers

HIGHSS=SD

HIGHSS<SD

HIGHSS=SD

HIGHSS<SD

RETAILERS

1 Bulk- breaking:

Currently, Hai Ha's products are sold in small units of 1 bag/small box or in kilograms, in

batches and cartons at retailers and the official e-commerce platform, creating favorable

conditions for the purchase and sale of goods Buy according to the customer's large/small

quantity

2 Spatial convenience:

Hai Ha is currently present on two e-commerce platforms, Shopee and Tiktok shop, to serve

customers' online orders As well as the traditional distribution channel network at agents and

retailers Hai Ha products also appear in modern channels such as large supermarket systems:

Winmart, BigC, MMMarket, Coop mart, Lanchi,

However, the product is still limited at other large e-commerce floors (Lazada, Tiki, ) and

convenience stores (Circle K, 7 Eleven, Ministop, ) The distribution system of wholesalers in

the Central and the South is also not high In which, it is mainly concentrated in the Northernprovinces (212 agents), the Central region (31 agents) and the South (27 agents) Therefore, customers in these two regions are restricted from making quick and convenient purchases because there will be few stores selling this product.

3 Delivery/ Waiting Time:

When buying Hai Ha products on Shopee, they will be shipped in one to two days forcustomers in the HCM City or inner Hanoi area (Hai Ha has 2 Shopee channels in Hanoi and

Ho Chi Minh City) ) and three to five days for orders in other neighboring provinces

4 Assortment/ Variety:

Hai Ha is considered as one of the largest confectionery brands in Vietnam, therefore, Hai Ha has a wide variety of product lines such as: Cookies and Cracker, Moon cake, hard candies, soft candies, Fresh cakes and Tet jam, many different flavors such as Chip Chip

marshmallows with traditional flavors, synthetic fruit flavors,

However, at present, there are many other brands in the FMCG industry with fierce

competition, quickly grasping customer tastes, so customers also have a variety of choices

5 Customer service:

Currently, the customer response rate on Hai Ha's e-commerce platform is quite high (95%)

However, with the fierce competition of the FMCG industry, Hai Ha still does not have customercare policies

48% of FMCG brands participating in the survey (According to Research by Eventtrack),

confirm that Experiential Marketing activities aimed at personalizing customer experience bringhigh ROI, at 3: 1 to 5:1 Currently, the stores that sell Hai Ha products have not had a

breakthrough in maximizing the customer experience Usually still in brick-and-mortar stores,

buyers can change their mind quickly to another brand.

6 Information Sharing:

On the fanpage of Hai Ha Company, we always update information about new products,

promotions and introduce the official channel selling products, namely Shopee and Tiktok shop.However, the amount of interaction in posts and views and followers on Tiktok is not high Thisproves that the advertising for the brand has many shortcomings and is not effective for

customers to really pay attention to Hai Ha's information from which it is difficult to grasp product information

Advertising in the media is still weak, in providing fake information to consumers When thereare new product launches, Hai Ha has not yet had PGs go to supermarkets/retailers to introduceproducts

Cost gaps

Channel Channel Environmental/Manag Cost Gaps Planned Do/Did [Targeting Member erial Bounds [Affecting Techniques Actions

Manufactur Manufacture Not screening orders inline with market needs Ordering:Can't manufacture's system Financiners → rs, The employees do not control the management g [Điềuwholesalers Wholesalers collect market order khoản và

→ retailers , Retailers information and only quantity of điều kiện

Manufactur Wholesalers Limited perspective onmarket demand Information Talk toagents,

Retailers

Manufactur Manufacture - The layers ofadvertising paint printed (AdvertisinPromotion Promotecommunicati cost-It will

er → rs, Retailers, on the truck are old and g Media, on on social moreRetailers → end-users peeled, no longer Advertising networking thanend-users attracting attention, Strategy) platforms current

new products

Manufactur Manufacture Because Hai Ha hasonly 3 manufacturing Physical Buildingmore -It willcosters -> rs, factories in the North, Possession warehouses more toWholesalers Wholesalers the transportation and in the South build a-> Retailers , Retailers distribution of goods to and Central warehou

will causeinconvenience in thesupply of goods andcost more

3.2.2 Conclusion

The distribution channel of HaiHa Confectionery Joint Stock Company is facing

many distribution channel problems such as:

1 Limitations on two-way information sharing:

- Downstream members only receive information about promotions, discount policies, have not received in-depth information about the types of products currently distributed by Haihaco or discount policies when buying wholesale and retail

- Train the skills of evaluating the market, building a more restrictive return policy of the salesperson