Licence professionnelle Commerce spécialisation Métiers de la Vente Professional degree in Marketing & Sales 2013 - 2014 TUTORED PROJECT Subject: Development of Energy drink : Red Sun in the Northern of Viet Nam Group 4: GIANG NHAT HOANG DUONG HOANG PHONG HOANG VU CUONG KIEU HONG PHUONG Hanoi, 16/01/2014 CONTENTS Acknowledgements First of all, we owe the teacher Professor Corinne Montoya and Nguyen Hoang a thank about the tips, advises and comment you have given to help us get over the difficulties and completed better in the process of implementation of this project. Secondly, we also sincerely thank the leadership of Vietnam Aqua joint stock Company who gives us a lot of information, knowledge as well as her experience to help us have practical knowledge to carry out our project. Thirdly, we honestly thank to Sales Department and Accounting Department of Vietnam Aqua Company. Finally, we want to send our faithful thanks to the Professors of Jean Moulin Lyon 3 University and Vietnam University of Commerce who have given us the background knowledge about Marketing, Finance, and Economy. JEAN MOULIN LYON 3 UNIVERSITTY VIETNAM UNIVERSITY OF COMMERCE Group 4 Page 2 of 33 These reports and articles in this book are related to the main activities of the company in recent years and along with product innovation projects as well as new sales marketing policy of Vietnam Aqua. *** CHAPTER I - INTRODUCTION 1. Company 1. Background VIETNAM AQUA JOINT STOCK COMPANY Company Name VIETNAM AQUA JOINT STOCK COMPANY Date of Establishment 22 AUGUST 2008 Address TAN QUANG COMMUNE , VAN LAM DISTRICT City/Province HUNG YEN PROVINDE Phone 0321. 3791.395 Fax 0321. 3791.393 Email congtytuthien@yahoo.com.vn Registration Certificate No. 0503000297 Director LE QUY TIEN Capital $750.000 JEAN MOULIN LYON 3 UNIVERSITTY VIETNAM UNIVERSITY OF COMMERCE Group 4 Page 3 of 33 Industry Wine, Soft dink Model Joint Stock Company Main Activities - Producing and trading wine and soft drink. - Export market: India, Laos, Capacity - Wine: 120.000 litter/year - Soft drink : 600.000 litter/ year 2. Logo 3. The function and the duty of the company  The function - Aqua JSC have its main function is to create and develop soft drink and pure water and reach the demand of the market - The company implements its self-supporting (non-financing by the government); the source of human, the material resources of the country are developed to speed up the import- export activities which hit the mark of increasing the foreign currency, contributing the national construction and economic development. - Joint venturing, associating with domestic and foreign economic organizations in accordance with the dominant economic development law.  The duty - Perform business activities on the basis of the initiative and to comply strictly with the provisions of the law. - Study the possibility of production to market demand, the proposed recommendations with Hanoi Industrial Office to resolve issues and problems in production and business activities. - Comply with government laws on financial management, import and export management and foreign trading; strictly implement the commitments in foreign trade contracts and contracts related to the manufacturing business of the company. JEAN MOULIN LYON 3 UNIVERSITTY VIETNAM UNIVERSITY OF COMMERCE Group 4 Page 4 of 33 Council members Board of Directors Administrative Offices Accounting Department Sales Department Technical Department Production Department Quality Control - Manage and use the business capital effectively, invest in expanding the innovation and equipment, self-offset the cost of import-export balance, ensure the business is profitable and fulfill the National budget. - Research, implement effectively the improvement of the products’ quality produced by the company, in order to increase business consumption revenue. 2. Human resources Currently, the company manages 70 employees, including salesman, accounting, and technical for 20 people and worker nearly 45 people. a. Organizational chart of the company - Board of Directors: take responsibility to run all activities and manage jobs of company every day. - Administrative Offices: Manage all workers and workers and employees in the company. Sort true labor trades and line qualification capabilities of workers. Responsible for training new trainees and regulate the number of employees in the company. Responsible for analysis and assessment issued wage unit price of products. Management of occupational safety and settlement of social insurance for worker in the company. - Accounting Department: Responsible for the management and proper use of all assets of the company. Provide timely capital for production, accounting business results if the company to pay the salaries of officers and employees. - Sales Department: They select the channels through which the goods are to be distributed, trains the salesmen in a knowledge of the goods and in methods of selling them, JEAN MOULIN LYON 3 UNIVERSITTY VIETNAM UNIVERSITY OF COMMERCE Group 4 Page 5 of 33 Supervises and directs the sales activities of the men out in the field. Sales men are responsible for persuading the consumer to purchase the end product, manufactured through marketing’s research. The Sales Department’s selling strategy could involve mail shots, travelling sales representatives, telephone sales and devising the sales interview. - Technical Department: Install and fixes all appliances, machines, equipment, respond for production. - Production Department: The Production Manager is responsible for making sure that raw materials are provided and made into finished goods effectively. He or she must make sure that work is carried out smoothly, and must supervise procedures for making work more efficient and more enjoyable. - Quality control: Responsible for quality control on each stage and the product – testing organization to ensure quality of the products. b. Labor structure according to educational level: No. Level Number of people Rate (%) 1 University 9 13 2 Professional School 11 16 3 Worker 42 60 4 Others 8 11 Total 70 100 (Source: Human Resources Department) JEAN MOULIN LYON 3 UNIVERSITTY VIETNAM UNIVERSITY OF COMMERCE Group 4 Page 6 of 33 OfferTrial jobInterviewApplication c. Recruitment Process  Recruitment process is done through following steps: - First, job application of each person will be reviewed based on the criteria previously required companies. - For those candidates who have a record approved, the company will make an appointment for an interview by the manager. - The candidates who pass the interview will be scheduled for trial jobs at the suitable position in three months. - F or three months, the manager will guide, observe and assess the capacity of each employee. Those who have high evaluation will be signing the employment contract with the company. d. Salary and Wages:  Salary of each employee depends on function and staff position. - Office staff and sales manager have level of salaries from 7 million VND to 12 million VND per month. - Worker and sales staff have level of salaries from 3.5 million to 5 million VND per month. - Wages of lower level staff are from 1.8 million to 2.1 million VND per month. - Besides the main salary, Human Resources Department manage staff records and based on the monthly reports and assess of the store manager about the employees’ capacity to decide the level of bonuses and fines for each employee and build promotion and replace employees. JEAN MOULIN LYON 3 UNIVERSITTY VIETNAM UNIVERSITY OF COMMERCE Group 4 Page 7 of 33 CHAPTER II - DETAIL OF CURRENT SITUATIONS 1. Financial analysis a. Income statement (VND) We analysis the income statement of Vietnam Aqua in 2012 and 2011 (million VND) 2012 % 2011 % Net sales 42,164 100 30824 100 COGS 30,554 72.46 23567 76.46 Gross Profit 11,610 27.54 7257 23.54 Operating expense - - - - 1. R&D expense 843.26 2.00 752.22 2.44 2. Selling , general and Administration expense 4,446.21 10.55 3352.66 10.88 Depreciation 20 0.05 20 0.06 EBIT 6,300.53 14.94 3132.13 10.16 Other expense 982.29 2.33 739.24 2.40 EBT 5,318.24 12.61 2392.89 7.76 Income tax 1,329.56 0.01 835.22 2.71 Net profit 3,988.68 9.46 1557.67 5.05 Through the table above, we can see that the business activities of the Vietnam Aqua in two years (2011 - 2012) has continuously developed: Total revenue each year is quite high and rises year over year, in 2012 total sales reach 42,164 million VND, rising 11,340 million VND compared to 2011. The profit after tax in 2012 reach 3,988.68 million VND, increasing at 2,431.01 million compared to 2011. This is a very good growth for company.  Profitability Ratio = Gross Profit*100/ Net sales  In 2012: 27.53 %  In 2011: 23.54%  Net profit margin (NPM) = Net profit*100/Net sales  In 2012: 9.46%  In 2011: 5.05% JEAN MOULIN LYON 3 UNIVERSITTY VIETNAM UNIVERSITY OF COMMERCE Group 4 Page 8 of 33 b. Balance sheet 2012 ASSETS ( million VND) LIABILITIES and STOCKHOLDERS’ EQUITY ( million VND) Current asset Liabilities Cash 1231.905 Current liabilities 894.57 Accounts receivable 1053.568 Account payable 1,168.57 Inventories 1,842.73 Tax 1,407.70 Other current asset 934.062 Other payable 1203.065 Total current asset 5,062.27 Total current liabilities 4,673.91 Long-term debt 1,970.42 Non – current asset Total liabilities 6,644.33 Machinery and equipment 5,212.80 Stockholders’ equity Furniture & fixtures 1,718.06 Common stock 4,223.23 Other non - current asset 460.987 Retained earnings 1,586.55 Total non-current asset 7,391.84 Total stockholders’ equity 5,809.78 Total asset 12,454.11 Total liabilities and stockholders’ equity 12,454.11 - Debt Ratio (2012) = Total liabilities/ Total Assets = 6,644.33/ 12,454.11 = 53.35% Company have 53.35% of debt ratio, the number is at the medium, the company seems to do well and its assets are financed by debt. - Current Ratio (2012) = Current Assets/ Current liabilities = 5,062.27/4,673.91 = 1.08 The current ratio of company is 1.08, it mean they have cash on hand, company could paid all debt but that will be effected to the business of the company. JEAN MOULIN LYON 3 UNIVERSITTY VIETNAM UNIVERSITY OF COMMERCE Group 4 Page 9 of 33 ting a. Marketing environment  Micro-environment - Customers o The company's consumer market is the environment including the purchase of goods to satisfy individual needs. Company supply soft drink to distributor to bring them to customer by some kind of retailer like bar, internet station, convenience store… o Wholesale market is the company or organizations standing out for Aqua distributions. o Vietnam Aqua JSC has exploited most national dealers and established retailers in Lao, Cambodia, India … - Competitiveness o Competitors always create pressure continuously to dispute the customers of Vietnam Aqua. o This is a fierce competitive environment between the company and the products of the other countries in the region such as Thailand, Singapore and the soft drink company having similar products in the country such as Red Bull, PepsiCo, and Coca-Cola …. So company put on measured advertising on TV, newspapers, flyers, banners, and advise the customers of the quality, form, design-changes of product. - Intermediary o The intermediary is the individual or organization supported Vietnam Aqua such as some Distribution and Advertising Company or Organization. o But this intermediate consumption helps businesses introduce products and advice to seek profits. o With the help from Distribution Company, they keep the reputation and the guarantee of the product to get in hand of customer with best condition - Suppliers o Supplier environment is the individuals or organizations supplying the input for VinaAqua and it’s competitors. o These suppliers put pressure about price and quality negotiation and quantity in the transaction. o Vietnam Aqua JSC determines this is one of the important factors, it can affect the quality and quantity, in order to maintain production for the company. o Some Suppliers of material and flavor like Kim Ha Co. LTD …  Macro-environment - Socio-culture environment: o Demographics of the positive factors supporting the success of Redsun products. With a population of over 85 million people (ranked 13 in the world), in which the South East and the Mekong River (figures 14 million respectively, accounting for 16.5% and 17.5 million accounted for 21%), the potential market of Redsun is extremely large (according to 2007 data of GSO). In addition that the tendency of urban areas in recent years, which have higher JEAN MOULIN LYON 3 UNIVERSITTY VIETNAM UNIVERSITY OF COMMERCE Group 4 Page 10 of 33 [...]... Hiep Phat, Raw material prices increasing, affecting the profitability of the company NEW PRO Group 4 Page 13 of 33 VIETNAM UNIVERSITY OF COMMERCE JEAN MOULIN LYON 3 UNIVERSITTY CHAPTER III - PROJECT: REDSUN ENERGY DRINK IN NORTHERN MARKET OF VIETNAM VinaAqua haven’t show in Northern Market yet so it’s a big opportunity in this market to launch the product of Energy drink here This market is really... looked at price secondly when they bought • energy drink (occupied 40%) These result shows that we have to focus the most on taste and try to reduce and make the best price for our product Next thing of RedSun energy drink that we have to design the brand look famous to customer and care less on design and the color but still have to have  an outlook that catching eyes and attractive to customer PART... Redbull a large number of customer said that RedBull and Sting energy drink is too sweet and too much Gas ( 70% out of 1000 ) and they are also like the color of Red Bull  For this result we are making RedSun energy drink taste like RedBull – a famous brand in all over the world and make it different to suit the taste of VietNamesse • Customer so our product have to less Sweet and less gas with the same . 18.58% (source: http://vnexpress.net/gl/kinh- doanh/2012/11/lam-phat-ca-nam-2012-khoang- 7-5 / and http://dantri.com.vn/su-kien/lam- phat-ca-nam-2011-chot-o-185 8-5 50325.htm ). The reduction of inflation. % 2011 % Net sales 42 ,1 64 100 308 24 100 COGS 30,5 54 72 .46 23567 76 .46 Gross Profit 11,610 27. 54 7257 23. 54 Operating expense - - - - 1. R&D expense 843 .26 2.00 752.22 2 .44 2. Selling , general. and Administration expense 4, 446 .21 10.55 3352.66 10.88 Depreciation 20 0.05 20 0.06 EBIT 6,300.53 14. 94 3132.13 10.16 Other expense 982.29 2.33 739. 24 2 .40 EBT 5,318. 24 12.61 2392.89 7.76 Income