Application of SWOT analysis to develop business strategies for DHL company

Ứng dụng phân tích SWOT xây dựng chiến lược kinh doanh cho công ty DHL , từ mô hình swot tìm ra cá điểm mạnh , điểm yếu , cơ hôi , thách thức của công ty để từ đó xây dựng chiến lược kinh doanh hợp lí , bên cạnh đó còn phân tích môi trường bên vi mô và vĩ mô để từ đó đề xuất các biện pháp kinh doanh cho công ty DHL

Application of SWOT analysis to develop business strategies for DHL company Thi Thanh Mai Nguyen ¹ , Thi Quynh Phuong Vu ² , Thanh Tung Pham ³

¹ 86335 - IBL1102 - Email : mai86335@st.vimaru.edu.vn

² 86448 - IBL1102 - Email : phuong86448@st.vimaru.edu.vn

³ 88015 - IBL1102 - Email : tung88015@st.vimaru.edu.vn

of 6.9% per year during the forecast period 2019 - 2027 (Jordan, 2019) More and more logistics companies are being established

to meet this huge demand all over the world One of the prominent companies among them is Dalsey Hillblom Lynn (DHL) However, DHL needs to research to expand its business strategy to compete with a series of other famous companies In this article, the micro and macro markets of the DHL corporation will be analyzed to assess the business strategies for the near future Moreover, the study will look at the SWOT analysis from many angles to identify the important factors in business strategic planning Finally, from our SWOT analysis and evaluations of the current situation of DHL Company, we have come up with the most suitable business strategy for the company

1 Introduction

In 1969, DHL was founded by Adrian Dalsey,

Larry Hillblom, and Robert Lynn inventing a

new business model dedicated to courier

service between San Francisco and Honolulu,

carrying documents of noncommercial value

(Chung and Bowie, 2018) Over the years, DHL

has multiplied its operations providing a

logistic global business channel that currently presents over 220 countries (Cosimato and Troisi, 2015) The founders began to ship papers by airplane from San Francisco to Honolulu, beginning customs clearance of the ship's cargo before the actual arrival of the ship and dramatically reducing waiting time in the harbor Erstwhile customers that were satisfied

Application of SWOT analysis to develop business

strategies of DHL company

with its service stood to save a fortune (DHL

International, 2008) This initial freight concept

gave birth to a new industry, the international

air express That is the rapid delivery of

documents and shipments by airplane.The DHL

Network continued to grow incrementally The

company expanded globally from Hawaii into

the Far East and to the Pacific region, then the

Middle East, Africa, and Europe By 1988,

DHL was already present in 170 countries and

had 16,000 employees (DHL International,

2008) Deutsche Post World Net and DHL

consolidation began in 2002 when Deutsche

Post World Net (DPWN) incorporated in

Germany became the major shareholder in

DHL By the end of 2002, DHL was 100%

owned by Deutsche Post World Net, (DHL

International, 2008)

Business strategy is the method and way of

doing business of a company or corporation in

the field of business, to achieve optimal

business performance Business strategy is the

overall content of an order, including a series of

measures and major business methods over a

long period (Nguyen , 2022) The ultimate goal

is towards promoting the highest profit and the

development of the business Business strategy

includes analyzing both internal and external

environments, building strong development

strategies to establish long-term and short-term

strategic plans, and implementing strategic

assessment and control Therefore the study of

business strategy development combined with

strategic management combines the basic steps

of environmental review, strategy formulation,

monitoring, and evaluation of that strategy

Developing business strategies places a great

deal of emphasis on monitoring and assessing

external opportunities and threats from the

point of view of emphasizing the company's

strengths and weaknesses Strategy for an

organization is the roadmap, or plan for how the

organization achieves its goals and objectives

(David, 1989) According to Mintzberg et al

(1999), strategy represented a commitment of present resources to future expectations Various studies on strategic management practice have been conducted by various scholars such as (Rosa, 1992; Awino, 2001; Machuki, 2005; Koske, 2003; Bryson, 1989; Nutt, and Backoff, 1992) From their studies, they established that each organization that practiced strategic management business be it state corporations, large corporations,s or small and medium enterprises had a distinct and organizations' clear formulation of vision and mission statements, environmental scanning, and had independently formulated their strategic plans and implementation (even though they may have used the services of the same consultant) and formulated their annual business plans They observed that strategic management is a set of management decisions whose aim is to decide on organizational goals, the means of achieving those goals, and ensuring that the organization is positioned in a sustainable composition to pursue the set goals and plan of action(s) that determines the long term performance of an organization, but there still existed a knowledge gap Considering the above aspects, the following research objectives are set Firstly to identify factors influencing the development of DHL's business strategy and secondly is using the SWOT model

to analyze and evaluate the development of DHL's business strategy

Business strategy is one of the key factors in the growth and development of a company Johnson and Scholes (2010) reckon that strategic management provides central purpose and direction, enables management to adapt to the changing operating environment, enhances competitive edge, and allows allocation of responsibility to capable managers to enable strategy implementation All organizations globally interact with the external environment and internal or operating environment (Pearce and Robinson, 2010) These factors together

with the internationalization phenomenon

posed great challenges to all organizations and

business firms Due to this dynamism,

organizations are therefore urged to adopt

strategic business to ensure their continuation

and development of a competitive edge over

their competitors Strategic business differs

from one organization to another depending on

the present environment that the organization

finds itself in because there is no universal

approach to strategic business DHL faces

challenges such as low services level

satisfaction from customers mainly on ues such

as delayed cargo collection to and from the

ports of origin, entry of smaller in size but

efficient freight forwarders, segmentation, and

fragmentation of freight forwarding services

where each product becomes a service on its

own (specialization) and uncertainties about

future business risks DHL has to be flexible

enough to respond to these environmental

challenges Its top management has the

responsibility to provide vision and direction

and plan and implement strategies that will

guide the company and safeguard its future

The structure of the paper is as follows: Section

1 provides an introduction and explains the

motivation for the work, highlighting the

objectives and the expected outcome Section 2

reviews the existing literature on the

operational performance of container ports

Section 3 presents the research methodology

adopted for accomplishing the objectives

Section 4 and 5 focus on the data analysis and

outcome factors Section 6 contains a

discussion of the results Finally, Section 7

concludes and summarizes the study

2 Literature review

Recently, as the era of business competition has

become tougher, business people from the very

beginning want to clearly define their

development path, the way to sustainably exist,

as well as the desire to do the same How to

make all members of the enterprise unanimously agree and do their best on the road

to common success This first of all depends on the construction and implementation of their business strategy The right business strategy will guarantee the existence, sustainable and long-term development according to the long-term goals of the business Up to now, there is

no unified definition of the business strategy of the enterprise Many scholars in different documents have introduced some concepts of business strategy such as “strategy is the determinant of long-term goals of the organization” (Alfred, & Candler, 1962) or

“strategy is the red thread throughout the organization's activities” (Igor Ansoff, 1965) The business strategy of the enterprise is in the conditions of the market economy, based on the objective and subjective, on the resources that the enterprise may have, to determine the strategies, paths, and measures to ensure the survival of the enterprise stable, long-term development according to the development goals that the enterprise has set Business strategies are important for directing a company's goals to achieve virtuoso performance (Latifah et al., 2020) Business strategies focus on improving the competitive position of a company’s products and services

in a particular industry or market segment served by the company (Marinescu et al., 2021) Business strategies differ from strategies at the corporate level At the business level, this strategy focuses more on improving the competitive position of the company’s products

or services in certain market segments (Lamb et al., 2022)

The essence of business strategy is expressed in five aspects To begin with, the business strategy is the expression of the competitive position of the enterprise When building a business strategy, businesses need to analyze their objective circumstances The purpose of this analysis is to understand the opportunities

and challenges that objective circumstances

present to the business At the same time, it is

also necessary to study the subjective

conditions of the business to know its strengths

and weaknesses The business strategy of the

enterprise must well combine the opportunities

that objective circumstances bring with the

strengths of the enterprise, and at the same time

must have solutions to overcome the challenges

and weaknesses of the enterprise Therefore, it

is necessary to study the competitive position of

the enterprise Only then can you come up with

the right business strategy If the competitive

position is not determined correctly, it is not

possible to make the right business strategy

Secondly, an enterprise's business strategy is a

business model, an operating platform, a

method of using resources, and a basis for

handling all problems of the enterprise Thirdly,

the business strategy is the expression of the

value concept of the enterprise Business

strategy is an expression of the value concept,

progressive spirit, and tenacious will of the

business leader, reflecting the leader's

assessment of the objective and subjective

conditions of the business Karma Only when

the leader properly assesses the objective and

subjective conditions of the business can the

right business strategy be devised Otherwise,

the business strategy will be wrong Then,

business strategy is creativity in business

management That means that enterprises based

on certain goals, arrange and form a new

effective and competitive management system

At the same time, creativity in management

must be closely combined with creativity in

regimes, creativity in the organization, and

creativity in techniques to bring into play the

effects of business strategies To implement the

strategy, all employees must master the

strategy, turn it into an annual plan, a plan of

each department, and into everyone's actions,

and must be feasible Competitive advantage

stems from a company’s strategic choices to

seize market opportunities (Reinstaller et al.,

2022) A business strategy, also called competitive strategy, is usually developed at the divisional level, and emphasizes improving the competitive position of a company’s products/services in the specific industry/market segment served by the division (Sanchez-Henriquez, & Pavez, 2021) The division’s business strategy may focus on increasing profits in the production and sale of products and services (Agustia et al., 2020) Business strategies should integrate various functional activities to achieve divisional goals (Abdelbadie et al., 2019)

Choosing a business strategy is a very important step in the strategic management process The foundation for choosing a business strategy is customer needs, product differentiation; customer groups and market segments; and different capacities For a world-leading logistics company like DHL, there are simple, though never simple, strategies In April 2014, Deutsche Post DHL Group introduced its Strategy 2020, positioning itself

as “The Postal Service for Germany and The Logistics Provider for the World” It is based on three pillars: Focus, Connect and Grow DHL Group has made significant progress with Strategy 2020 Due to its geographical spread and wide range of logistics offerings, the Group

is now better positioned than ever before With

“Strategy 2025 – Delivering Excellence in a Digital World” the company is laying the groundwork to continue its successful growth trajectory beyond 2020 The four most important trends that have been impacting logistics in recent years will also shape the industry going forward: Globalization, Digitalization,E-Commerce,and Sustainability Strategy 2025 is the Group’s response to these

In the past, there have not been many clear research papers when applying SWOT analysis

to building business strategies with DHL Therefore, it is possible to get an overview of

DHL's business strategy, research,h and explore

the development activities of the business

strategy at DHL SWOT Analysis of DHL

focuses on strengths, limitations, opportunities,

and threats DHL is one of the largest Logistics

companies The strengths and weaknesses of

DHL Swot are internal factors, while

opportunities and risks are external factors

SWOT Analysis is a validated management

tool that enables a company like DHL to

measure its business performance with

competitors and the industry

3 Methodology

SWOT analysis overview

The word "analysis" originates from the Greek

language, meaning to separate into parts, loosen

and dissolve A SWOT analysis does this by

'peeling back layers of the company' (Williams,

1996) and is widely used in many

organizations

The initials of the acronym and mnemonic

'SWOT' represent the four factors of Strengths,

Weaknesses, Opportunities, and Threats

In an organization, a SWOT analysis involves

pinpointing these areas to assist managers in

identifying the key facts, thereby giving them a

focus on what needs to be tackled and an

awareness of the relevant opportunities and

possible threats Williams (1996) claims that

effective business leaders are people who live

'in a world of SWOT', as they will be

individuals who will have access to the right

information so that they can act on maximizing

opportunities and attempting to avoid threats

As such, SWOT analysis is recommended by

some as a prime tool of analysis (Hatton et al.,

1992)

Within SWOT analysis, the Strengths and

Weaknesses are seen as internal controllable

factors and can be acted upon (e.g staff

turnover, organization image) The

Opportunities and Threats are external,

uncontrollable factors These form the external environment within which the organization operates and may include demographics, rates

of interest, changes in legislation, etc (Hatton

et al, 1992) It is the opinion of some that for a company that desires to grow, the objective appraisal of strengths and weaknesses should

be high on the list of necessary activities (Ansoff, 1956; Cordiner, 1956; Leavitt, 1965, etc) A major objective for many managers is the identification of threats and opportunities through environmental scanning (Jackson and Dutton, 1998) The fundamental principles of SWOT analysis, therefore, seem to play an integral part in the organization’s domain SWOT (strengths, weaknesses, opportunities, and threats) analysis is a method for identifying and analyzing internal strengths and weaknesses and external opportunities and threats that shape current and future operations and help develop strategic goals A SWOT analysis is designed to facilitate a realistic, fact-based, data-driven look at the strengths and weaknesses of an organization, initiatives, or within its industry The organization needs to keep the analysis accurate by avoiding preconceived beliefs or gray areas and instead focusing on real-life contexts Companies should use it as a guide and not necessarily as a prescription (Will, 2022)

This technique is designed for use in the preliminary stages of decision-making processes and can be used as a tool for evaluation of the strategic position of organizations of many kinds (for-profit enterprises, local and national governments, NGOs, etc.) (Silva, 2005) It is intended to identify the internal and external factors that are favorable and unfavorable to achieving the objectives of the venture or project Users of a SWOT analysis often ask and answer questions

to generate meaningful information for each category to make the tool useful and identify their competitive advantage SWOT has been

described as a tried-and-true tool of strategic

analysis (Sevier, 2001), but has also been

criticized for its limitations, and alternatives

have been developed

Application of SWOT analysis

A SWOT analysis, looking at the strengths and

weaknesses of the company and the

opportunities and threats in the marketplace,

lets them develop a strategic approach to reach

its goals In marketing, it can help the company

identify ways in which it can improve its

thitsompetitive position The application of a

SWOT analysis improves the performance of

the company and reduces business risks

To apply a SWOT analysis to a marketing

challenge the company has to analyze its

internal characteristics List as strengths what

they do well and where their performance is

superior Identify recent failures and poor

execution as weaknesses Look at the

company's business environment to find where

there are opportunities to grow and increase

profitability Find threats that prevent the

company from reaching its potential

To take advantage of developments in the

marketplace, the company has to match its

strengths to the opportunities If they have

high-quality products and a potential new customer

close by, you have to assign resources to exploit

this business Develop a strategy that informs

the potential client of the reputation for quality

and proximity Give the best sales

representatives the responsibility to sign for this

new business Make sure you know the

prospective customer's preferences and

business practices

After identifying the company's strengths, look

at its market environment and check where its

strengths match the actions it can take to reach

your company's goals If the company examines

the needs of its customers, the technology

available, the economic trends, and the product

developments, it can find initiatives that match its strengths and that the company will successfully support The key is to find at least one opportunity for each strength that the company listed in their table

The company must address weaknesses identified in a SWOT analysis by fixing the problem or eliminating the weak activity The company has to address threats from a SWOT analysis by strengthening the company

to meet the threat, eliminating the threat by abandoning the threatened activity, or classifying the threat as unimportant and taking

no action

Process of SWOT analysis

A SWOT analysis can be broken into several steps with actionable items before and after analyzing the four components In general, a SWOT analysis will involve the following steps

The first thing you need to do is define the company's objectives Although a SWOT analysis might be broad, it is likely to be more valuable if it is focused on a specific goal For instance, the goal of a SWOT analysis would be

to determine whether or not to launch a new logistics service A corporation will have direction on what they intend to accomplish after the process if they have a target in mind The SWOT analysis in this case should assist in deciding whether or not the service should be presented

Second, we must collect data about that company Every SWOT analysis will be distinct, and a business may require various data sets to support creating several SWOT analysis tables To start, a business should be aware of the information it has access to, the data constraints it encounters, and the dependability of its external data sources

A business should be aware of the ideal people

mix to include in the study in addition to the

data Various employees inside the

manufacturing or sales sectors may have a

greater understanding of what is happening

within while other employees may be more

connected to external factors A varied range of

viewpoints is also more likely to provide

contributions that add value

The next step is to compile ideas For each of

the four components of the SWOT analysis, the

group of people assigned to perform the

analysis should begin listing ideas within each

category First, we come to the internal factors

What occurs within the company serves as a

great source of information for the strengths

and weaknesses categories of the SWOT

analysis Examples of internal factors include

financial and human resources, tangible and

intangible (brand name) assets, and operational

efficiencies Second, there are external factors

What happens outside of the company is

equally as important to the success of a

company as internal factors External influences, such as monetary policies, market changes, and access to suppliers, are categories

to pull from to create a list of opportunities and weaknesses

An indispensable step is to refine the results With the list of ideas within each category, it is now time to clean up the ideas A corporation can narrow its emphasis to only the finest concepts or the greatest business risks by refining the ideas that everyone had Significant discussion among participants in the analysis may be necessary at this level, and top management may need to be involved to assist rank priorities

Last but not least is the development strategy of the company Armed with the ranked list of strengths, weaknesses, opportunities, and threats, it is time to convert the SWOT analysis into a strategic plan Members of the analysis team compile a synthesized plan that offers direction on the original target using the bulleted list of things inside each category

4 Analysis current situation of DHL

Company

Overview of DHL company

A German business that specializes in

international freight and logistics solutions, as

well as contract fulfillment, is called DHL

(short for Dalsey, Hillblom, and Lynn) Adrian

Dalsey, Larry Hillblom, and Robert Lynn

started the business in 1969; The business is

called DHL Express International and is

denoted by the initials D, H, and L of the

founders Initially providing mail delivery

between the continental United States and

Hawaii, DHL has now expanded its service to

many commercial areas Deutsche Post started

buying DHL shares in 1998, eventually buying

back a majority stake in the company in 2001,

then complete the transaction in 2002

Deutsche Post also bought Securicor Omega in

the UK For these reasons, DHL's global headquarters are located in London and Bonn, Germany (Exel PCL) The Asia-Pacific headquarters are in Singapore, while the Americas (including the US) headquarters is in Plantation, Florida European Air Transport is

a freight carrier owned by DHL The airline's headquarters are now located at Brussels Airport in Belgium, but eventually, they will relocate to Leipzig, Germany Vietnam is one

of the more recent and underdeveloped nations

in the express delivery sector DHL wants to gain market share and expand its operations in Vietnam 300 people have worked here for DHL since 1998, one of the first express delivery organizations to build a solid reputation on a global scale DHL is one of the few trustworthy and high-quality courier services since it has effectively capitalized on the need to deliver documents and items courier service DHL currently operates two

operation centers in Hanoi and Ho Chi Minh

City, three transaction centers, four transit

stations, more than ten service points with

more than 1000 employees, a 56,400 m2

warehouse, and 37 infrastructures It serves

more than 7000 clients and processes more

than 1.5 billion shipments annually DHL

continually makes investments in the

Vietnamese market to raise the quality of its

services On average, it spends US$130 million

to expand the region's capacity for air freight,

which includes Vietnam To address the

expanding import and export demand of the

Western region, Long An Transshipment

Station, with a capacity of 80,000

shipments/year, was built for $1 million USD

Building a new operation center in Da Nang

will cost 10 billion dong launching a weekly

schedule of five direct flights using a B727F

freight jet with a payload capacity of 22 tons

from Ho Chi Minh City to Hong Kong At Tan

Son Nhat Airport, spend money on other items

Vietnam's service stations, truck fleets, and Ho

Chi Minh City

The DHL business sectors are the specialist

Business Units within the DHL group that offer

an exceptional range of logistics goods and

solutions, from express delivery to domestic

and international parcel delivery road, air, and

expedited international transportation For the

closed supply chain management, use rail and

the sea

When it comes to DHL's performance during

the previous years, net profit: The fiscal year

2021's consolidated net profit increased

significantly from 3,176 million euros to 5.423

million euros 370 million euros went to

shareholders with non-controlling interests,

while 5,503 million euros were allocated to

Deutsche Post AG shareholders Both basic

and diluted earnings per share rose from 2.41

to 4.10 euros and from 2.36 to 4.01 euros,

respectively Net gain: Profit before taxes and

interest during the first quarter of 2021 was

almost 215 million euros Due to a shortage of sea freight capacity, the gross margin for air and ocean freight is higher Other base expenses From €33,704 million to €43,897 million, material costs grew primarily as a result of higher transportation expenses in the Global Shipping and Shipping division and higher fuel expenses in the Courier division The main reason for the increase in staff costs—which rose from 23,879 million to 1.645 million euros—was an expansion in the workforce Depreciation, amortization, and loss accounts, on the other hand, decreased by

62 million euros to 3,768 million The Supply Chain division endured required value losses during the previous year as a result of lockdown measures, among other things Advertising expenses, such as those associated with DHL's global brand campaign, among other expenses, boosted other operating costs

by 442 million euros to 4.896 million euros DHL's vision, mission, and awards are listed after that According to research, DHL has a written vision and purpose statement In order

to "become a Logistics Company for the World, delivering freight forwarding services promptly, effectively, and always with the best interests of customers in mind," the company's vision is to German Post DHL is one of the first companies to take its responsibilities to society, the communities in which it operates, its employees, and the environment seriously Incorporating corporate responsibility (CR) into our corporate strategy In keeping with the problems facing our firm and our particular businesses, Deutsche Post DHL seeks to advance sustainability.To create a strong DHL company, it is important to pay attention to financial matters

Table 1 Net profit margin of DHL from 2012

From the calculation of the net profit margin, it

comes to attention that the ratio was lower than

10%, for all three companies for five years

DHL recorded the lowest net profit ratio in

2015, in this particular year although sales

increased profit went down, this year the

material expenses, staff cost, depreciation, and

operating expenses increased In the same year,

FedEx also had the lowest net profit compared

to other years, but UPS recorded the highest

level of net profit margin.DHL’s highest profit

was in 2016, this year the company was able to

control a few costs which led to more profit and

a good ratio as well

Table 2 Asset turnover of DHL from 2012 to

1.39 times

2013 1.55

times

1.32 times

1.53 times

2014 1.53

times

1.38 times

1.64 times

2015 1.56

times

1.28 times

1.52 times

2016 1.50

times

1.09 times

1.51 times

Source: http://www.dhl.com Higher asset turnover is better, all companies had more than 1-time asset turnover, which means all three companies are efficiently managing their business In DHL asset turnover ratios were more than 1.5, which indicated that the company utilized assets 1.5 times or more compared to the sales 2012 the turnover was 1.63, which highest for DHL for the period because the company sold more compared to the assets

Table 3 Total Debt/Equity of DHL from

From the above calculation, it is clear that the

gearing of DHL is very high compared to the

competitors For all five years, the company’s

gearing was more than 200%, which may be

due to high level of debt than the equity the

company holds on This gearing may make the

future of the company very tough or getting

loan capital will be difficult for DHL But the

others two competitors are still in a good

position means their gearing was lower than

DHL’s

Table 4 ROE of DHL from 2012 to 2016

Year DHL FedEx UPS

The vision and mission statements were found

to have been created after careful consideration and investigation The process starts with a strategic planning process when members at the corporate level, management, and local employees provide their opinions on where they envision the organization in the following five years Additionally, important logistics clients and service providers such as importers, exporters, airlines, ships, customs officials, and freight forwarders were interviewed The management team offered a vision, mission, and strategic goals that were in line with the vision of the entire organization after compiling the many viewpoints and presenting them to them The board of directors subsequently gave its approval to the vision, mission, and strategic goals Management is now responsible for creating strategies and action plans for achieving them In this sense, vision and mission statements were spread arranged as a free-flowing conversation with associated writing The co-manager had a meeting with the management team and made sure they understood how important it was for them to follow strategic management at the divisional level To engage and coordinate, managers are urged to meet with staff members and pay them a visit DHL Express Vietnam continuously invests to improve in all areas in order to offer better working conditions for employees and stand out in the job market This has aided DHL Express in earning a

number of business honors, including the

Golden Dragon Award for Transportation

Services four times, five Gold Stevie Awards

for four straight years, and the title of No 1

carrier in Vietnam from Anphabe VN Nam,

chosen by Anphabe VN, was recognized by the

Vietnam HR Awards 2018 and "The

Employer" as the company with the "Best

Working Environment." the Institute of Top

Employers' "Top Employers 2019" In

addition, the company has received recognition

at the following events: 1 CS tournament in

Europe, 4 CS tournaments in the Middle East

and North Africa, and 6 CS tournaments in

Sub-Saharan Africa

Macro environment analysis

The macro-environment includes factors,

forces, institutions, etc., located outside the

organization, which are difficult for managers

to control, but they have an indirect influence

on the organization's operations and results

The macro-environmental analysis is the

analysis of demographic, legal, socio-cultural,

natural, technological, and economic factors

that affect the operation of all enterprises in the

industry The analysis of the macro

environment in the analysis of the business

environment aims to determine the influencing

factors, the direction of impact, and the

magnitude of the impact on the entire logistics

industry in general and the express delivery

segment in particular in the Vietnamese

market Generally speaking, it is the review of

all factors from the macro environment,

thereby indicating the opportunities and threats

that businesses need to face when planning and

implementing strategies, so it is necessary to

Combine business environment analysis

information and analyzing the internal

environment of the business, thereby

determining the direction and strategic vision,

helping the company determine the appropriate

goals and business models and strategies

suitable business

The first is the political environment revolves around the government of the country where the business is done business; the laws of the domestic as well as foreign markets This is a factor that affects all businesses in a territory Government, legal and political factors affect businesses in different ways They can create opportunities, obstacles, and even real risks for businesses FDI enterprises continue to consider Vietnam as an attractive investment destination with stable political advantages, the gradual opening of administrative procedures, reduced inspection, and unofficial costs Vietnam's political stability has always been attractive to foreign investors This factor of Vietnam is continuously appreciated by FDI enterprises, with a rate of over 90% Vietnam has a lower risk of business ground revocation and a lower risk of policy instability, after impressive progress in recent years Although Vietnam is a country with political stability, besides that, Vietnam is one of the countries with high tax rates in the import and export industry because Vietnam is a developing country The high tax will reduce the competitiveness of imports from Vietnam compared to goods imported from other non-taxable markets As a result, importers in the taxing country may divert imports from other non-tariff countries, leading to a decrease in Vietnam's export turnover, a narrower market share, and a shrinking export business Vietnam faces the risk of losing export markets

The second is the economic environment The current state of the economy and future trends have an impact on the success and strategy of

an industry, locality, or country The economic environment is a collection of many factors that have far-reaching effects in different directions on the activities of sectors, localities, and countries The main factors in the economic environment are Economic growth rate; Interest rate; Monetary policy exchange