Research Project Assignment 2

The research title is: “The impact of Vietnam counterfeiting law on awareness and behavior of PepsiCo’s customers” PepsiCo is a famous brand, it leads in convenient snacks, foods and be

The impact of Vietnam counterfeiting law on awareness and behavior of

Prepared by: Maple Group

Vương Thị Quỳnh Anh - Lynn

Ngô Thị Huyền Trang - Jess Nguyễn Phương Thảo - Key Nguyễn Thị Kiều Anh - Snow

Submitted: 11/06/2013

TABLE OF CONTENTS

EXECUTIVE SUMMARY 4

INTRODUCTION 5

1.1 Research Background 5

1.1.1 History of the company 5

1.1.2 Mission and Vision 6

1.1.3 Value and Philosophy 7

1.1.5 PepsiCo’s Products 8

1.2 Problem Statement 9

1.3 Research Objective 12

1.4 Significant of study 13

1.5 Research Questions/ Hypotheses 13

1.5.1 Research Questions 13

1.5.2 Hypothesis 14

1.6 Action Plan and Target Date 16

1.8 Research ethics 20

1.9 Layout of chapter 21

LITERATER REVIEW 22

2.1 Introduction 22

2.1.1 Area 22

2.1.2 Topic 22

2.2 Articles about problem 23

2.2.1 Quality inspection factor 23

2.2.2 Regulation factor 24

2.2.3 Customer awareness factor 24

2.2.4 Activity factor 25

2.2.5 Living standard factor 26

2.3 Conclusion 27

RESEARCH METHODOLOGY 28

3.1 Research Design 28

3.1.1 Type of research 28

3.1.2 Research method 28

3.1.3 Research Design Technique 29

3.2 Research Sampling 30

3.3 Research instrument 30

3.4 Data gathering procedure 33

3.4.1 Primary Data 33

3.4.2 Secondary Data 34

3.5 Methods of Data Analysis 34

REFERENCES 101

EXECUTIVE SUMMARY

Nowadays, counterfeit products become more and more development in the Vietnam market The negative consequences that it brings to society are not small It effects on consumer finance, undermine the confidence of consumers about the transparency of commodity markets, and detract reputation of the genuine manufacturer As a result, counterfeiting law of Vietnam’s government is a tool to protect the benefits of company and customers In addition, it will reduce the effects of counterfeit products with the development and reputation of company in customers’ perception

The research title is: “The impact of Vietnam counterfeiting law on awareness and behavior of PepsiCo’s customers”

PepsiCo is a famous brand, it leads in convenient snacks, foods and beverages with revenues

of more than 60$ billion and over 285,000 employees from over 200 countries in over the world Especially, all of PepsiCo products are very easy to counterfeit This research with the aims of investigates the Viet Nam counterfeiting law in situation of PepsiCo, and it based on PepsiCo’s customer The research includes 3 chapters which are introduction, literature review, and research methodology

 Chapter 1: Introduction, the report gives the information of PepsiCo including

history, operation, and structure Besides, there are some problem statements, following by research objectives, research questions, action plan and target dates, research limitation, and research ethics

 Chapter 2: Literature review includes all the definition or phrases related to the

research

 Chapter 3: Research methodology includes research design, research sampling,

research instrument, and methods of data analysis

 Chapter 4: Research findings includes present and summaries the findings using

suitable methods, charts, diagrams, and tables; evaluate the methodology used and critically analyze the findings

 Chapter 5: Conclusions and recommendations, proposes recommendations based on

the findings that identify, and justify areas for future research

Therefore, in order to know how is the state of counterfeiting, piracy, the current poor quality in Vietnam? And the causes of counterfeiting, counterfeit, inferior quality product exist and develop? What ways are needed to curb counterfeiting, counterfeit, inferior

quality? This is the main reason why our group chose research" The impact of Vietnam counterfeiting law on awareness and behavior of PepsiCo’s customers" to discuss in

the research

1.1.1 History of the company

PepsiCo, Inc is an America multinational company headquartered in Purchase, New York, United States Currently, it leads in convenient snacks, foods and beverages with revenues of more than 60$ billion and over 285,000 employees from over 200 countries

in over the world PepsiCo consists of PepsiCo Americas Foods (PAF), PepsiCo Americas Beverages (PAB) and PepsiCo International (PI) According to detail information which is posted in PepsiCo’s website, the company experiences more than 47 years with many development stages Below is some main point in the history of PepsiCo:

 1965 - PepsiCo was formed by Donald M Kendall, President and Chief Executive Officer of Pepsi-Cola and Herman W Lay, Chairman and Chief Executive Officer

of Frito-Lay, through the merger of the two companies

 1970 - PepsiCo moves from New York City to new world headquarters in Purchase, N.Y PepsiCo is the first company to respond to customer preference with lightweight, recyclable, plastic bottles

 1974 - PepsiCo becomes the first American consumer product to be produced, marketed and sold in the former Soviet Union

 1980 - PepsiCo Food Service International (PFSI) is formed to focus on overseas development of restaurants

 1982 - Pepsi Free and Diet Pepsi Free, the first major brand caffeine-free colas, are introduced Inauguration of the first Pepsi-Cola operation in China

 1985 - PepsiCo is now the largest company in the beverage industry The company has revenues of more than $7.5 billion, more than 137,000 employees Pepsi-Cola products are available in nearly 150 countries and territories around the world Snack food operations are in 10 international markets

 1986 - PepsiCo purchases 7Up international, the third largest franchise soft drink operation outside the United States

 1993 - Pepsi- Cola introduces Aquafina bottled water into test market

 1996 - Pepsi-Cola launches Pepsi World at www.pepsiworld.com (PepsiCo, n.d.)

1.1.2 Mission and Vision

At PepsiCo, they believe being a responsible corporate citizen is not only the right thing to do, but the right thing to do for their business

 Mission

PepsiCo’s mission is “to be the world’s premier consumer Products Company focused on

convenient foods and beverages PepsiCo try to produce financial rewards to investors as

we provide opportunities for growth and enrichment to our employees, our business partners and the communities in which we operate And in everything we do, we strive for

honestly, fairness and integrity” (PepsiCo, n.d.)

By always create the belief and trust for stakeholder, also always set themselves ethics in business, PepsiCo deserve getting more succeed in the future

 Vision

Besides, PepsiCo also set a specific vision which is “PepsiCo’s responsibility is to

continually improve all aspects of the world in which we operate- environment, social, economic social, economic- creating a better tomorrow than today” (PepsiCo, n.d.)

It can be said that vision of PepsiCo is very precious because they understand the role of customer in business They focus more on customers and environment around customers This proves that PepsiCo only interested in economic development - immediate benefit,

that they ignored the long-term benefits of environmental protection and health of customer as well This makes increase the belief of customer with company Therefore, since established, the strategic vision of PepsiCo makes the company develop significantly and in a short time, it becomes market leader of Fast-Moving Consumer Goods (FMCG) industry

1.1.3 Value and Philosophy

Values & Philosophy are the foundation for business decision of PepsiCo

PepsiCo’s values are sustained growth, empowered people, responsibility and trust “They are committed to delivering sustained growth through empowered people acting responsibly and building trust”

The company maintains their values by 6 philosophies:

- Care for our customers, our consumers and the world we live in

- Sell only products we can be proud of

- Speak with truth and candor

- Balance short term and long term

- Win with diversity and inclusion

- Respect others and succeed together (PepsiCo, n.d.)

1.1.4 Organizational structure

Chart 1.1: PepsiCo’s organizational Chart (Source: PepsiCo.com) For PepsiCo’s robust growth in recent years, PepsiCo felt it was time to manage the company as three units instead of two to sustain our growth rate and also to develop global senior leadership talent for PepsiCo’s future Therefore, PepsiCo created three operating business units: PepsiCo Americas Foods (PAF), PepsiCo Americas Beverages (PAB), and PepsiCo International (PI) They believed that this organizational structure will help them deliver strong top-line performance and profit growth (PepsiCo, n.d.)

Table 1.1: PepsiCo’s Product 1.1.6 Overview of the PepsiCo’s operation in Vietnam

 4/12/1991 - International Beverage Company (IBC) was established as a joint venture between SP.Co and Marcondray-Singapore with capital contribution of 50% - 50%

 2/ 1994 - The US Embargo to Vietnam was lifted marking the phenomenal entrance of PepsiCo into new market The diverse product portfolios including PepsiCola, 7Up, Mirinda, Aquafina, Sting, Twister, and Lipton Ice Tea are widely

and deeply distributed to Vietnamese consumers from the five operations branches located across Vietnam

- Officially, PepsiCo teamed up with International Beverages Company (IBC) – a well-established local joint venture to manufacture and distribute Pepsi-Cola and 7Up products in Vietnam

- PepsiCo held 30% equity of the joint venture (JV) with the other two partners – SP.Co (Vietnamese) and Macondray (Singapore) sharing the balance

 1998 - PI bought 97% stocks, SPCo 3%, up to $110 million invested

 2003 - Pepsi Cola Global Investment bought the remaining 3%, renamed the company into the International Beverage Company PepsiCo Vietnam

 2005 - Officially became the company which has largest market share in Vietnam

 2006 - Launch of the first food product (Snack Poca)

 2007 - Development of new sector - Soy Milk

 2008 - Inauguration of factory packaged foods in Binh Duong (PepsiCo, n.d.)

Problem 1: The difficulties in product quality inspection in Vietnam (Quality inspection factor)

Director of market manager department of Hanoi said that the identification of counterfeit and poor quality goods on the market is not difficult, but in order to prove it

is counterfeit products before handling is not easy

According to Decree No.140-HĐBT (25/4/1991) assign about inspection, handling the production, trafficking in counterfeit goods and Decree No.115-HĐBT (13/4/1991)

provides for the implementation of the Ordinance Measurement, it wrote:

- The handling of counterfeit and poor quality products required assessment concluded counterfeiting

- The applicant must pay the amount of violation assessment (moi.gov.vn, n.d.)

The fact is that the costs of inspection for counterfeit and poor quality products are very expensive Assessment agency must pay inspection fee in advance After inspection, if it

is counterfeit goods, they will destroy it immediately and the violators will have to pay penalty, but hardly do violators pay it This is difficult for assessment agency to complete their responsibility Thus, it leads to many kinds of products which does not ensure about quality still exist in market blatantly Therefore, these problem effects directly on PepsiCo’s operation and especially they make reduce the belief of customers

to company’s products

Problem 2: There are many gaps in Vietnam counterfeiting law (Regulation factor)

Currently, Vietnam government is fighting against counterfeit goods by applying laws strictly However, Vietnam counterfeiting law still exist gaps leading to the appearance

of new criminal behavior According to article 320 of Law of Trade “Since 2001 - 2011, relevant agencies have conducted tests and discovered handled 2017 cases of administrative violations, of which, poor quality service is 1752, counterfeiting and violations of intellectual property rights, industrial designs of 265 cases” (moi.gov.vn, n.d.)

According to Do Van Phuoc, the Director of Market Management Department, and Deputy Minister Steering Committee 127/TG, the difficulties that the industry is facing

in fighting against counterfeit goods and trade fraud is:

- The regulations in term of counterfeit goods are unclear, for instance in many cases, quality goods are very poor, but lack of basic legal to conclude that that is fake products

- The legal documents also lack of unity

- There are not any methods strong enough or suitable for fighting against counterfeit and poor quality products (dantri.com, n.d.)

This problem is very serious and it effects significantly on legal benefits of customers and PepsiCo as well

Problem 3: Citizens do not have high awareness in fighting against counterfeit products (Customer awareness factor)

In some transactions, when customer purchases and uses goods, they hardly interested in providing sufficient information to ensure legal benefits after buying goods At the same time disregard the reference manual goods manufacturers, which led to the dispute with company when they buy fake and poor quality products

Moreover, almost Vietnam consumers do not concern more about detecting fake goods

In contract, they only interested in product’s beauty (whether it are beautiful or not) and product’s price (whether it cheap or not) However, in fact fakes products always more beautiful, and especially their prices is cheaper than original products so consumers always are attracted by counterfeit and poor quality products Customers do not assess serious impact of their counterfeit product to their health so they do not have high awareness in fighting against counterfeit product This also is a big problem make difficulties in applying Vietnam counterfeiting law

Problem 4: Vietnam government and company is lack of propaganda program to help customer distinguish between original and counterfeit products (Activity factor)

Nowadays, counterfeiting and piracy is the risk of the economy in Viet Nam; many activity counterfeiting, piracy is going on around the world with various large and small scale The product counterfeiting, piracy increasingly in many forms such as: copy brand, style or false geographical indication One of the most reasons is because consumer cannot distinguish between original and counterfeit products PepsiCo produce snack, foods, and beverages; all of them are products which easy to counterfeited The counterfeiter used the old packaging to make new fake products with the same brand but the water inside is bad quality, inexpensive material; therefore, the health of customer can be harm In this case, the consumers have difficulty to identify In Viet Nam, the government and company do not have implemented the program to guide consumer distinguish between original and counterfeit goods, leading to the weakness of the company in helping customers choose the real products with good quality

Problem 5: Consumer using counterfeiting product because of low living standard (Living standard factor)

With the development of economy, the living standard is improved but when compare with country in Asia, the living standard of Vietnamese people is very low According to figures of the Ministry of Industry and Trade, in 2011 GDP estimated at U.S $ 119 billion Capita GDP reached $ 1,300 / person / year (moi.gov.vn, n.d.) This number is low when compare with other country such as Chinese about $6,786 / person / year (Mạnh, n.d.) Because of low standard living, people in Vietnam choose using fake

products that is cheap and suitable with their financial situation instead of original product As a result, if government want to reduce counterfeit goods in market, one of the most important things that government have to do is improve living standard especially income of Vietnamese people It can protect company and customer from effect of fake product In addition, it can bring more revenue for company and protect customer especially health of customers from low quality product in the market

1.3 Research Objective

In competitive business environment, Vietnam government has many ways to protect benefits of companies and customers One of them is counterfeiting law For the research topic: “The impacts of Vietnam counterfeiting law on awareness and behavior of PepsiCo’s customers”, this research aims to achieve the following objectives:

 To understand the advantages and the disadvantages of Vietnam’s counterfeiting law which influence on awareness and behavior of PepsiCo’s customers

 To find out the main reason that Vietnam government cannot prevent development of counterfeit and poor products

 To help PepsiCo have more information about regulations and new terms of the counterfeiting law of Vietnam

 To understand deeply ways that counterfeit product spread into market to prevent its development

 To know ways PepsiCo fight against counterfeit to reduce its effects on the development of PepsiCo and customers’ health as well

 To raise awareness of customers in distinguish fake and poor quality product

 To help customers know their rights, and their benefits and give solutions for them when buying counterfeit and poor product

With the clear objective, this research can help PepsiCo understanding about the benefits and limitations of Vietnam counterfeiting law with company Moreover, this research can give some solution that company solve with anti- counterfeiting from that PepsiCo can give best project to reduce the effects of counterfeiting product to revenue and reputation of PepsiCo in Vietnam In addition, customers can have knowledge and some solution to solve when they met fake product in market so customers can choose original product that good for their health

1.4 Significant of study

Research topic is “The impacts of Vietnam counterfeiting law on awareness and behavior of PepsiCo’s customers” As a result, this research will provide useful

information for specific group of people

First, for company (PepsiCo), this research will help them understand more about

counterfeiting situation in Viet Nam Then, it will be much easier for PepsiCo to find out the solutions and they can feel comfortable to cooperate with the government to prevent counterfeiting

Second, for managers and employees, this research gives more knowledge about

regulations of Vietnam counterfeiting law so that managers and employees recognize the important role of counterfeiting law From this awareness, managers and employees can give new ideas, give the best ways to fighting against counterfeit and poor products, and improve the shortcomings in protecting their brand to remain the development of company and PepsiCo’s leader position

Third, for customers, the research help customers raise awareness in distinguish

counterfeit and poor product to ensure legal benefits and give some ways to deal with problems when buying counterfeit and poor product

Fourth, for students, this research helps student know how Vietnam counterfeiting law

impact on customers of specific company Moreover, students have more experiences to

do research especially research about the Vietnam counterfeiting law and have more understanding about the business environment in Vietnam

Finally, for future researchers, by using our information and data, comparing with our

strong point and weakness; they can improve their research successfully

1.5 Research Questions/ Hypotheses

The research question for this study will be:

1 What is the respondents’ profile in terms of?

1.1 Gender

There are 10 hypotheses for this research based on the conceptual frameworks below:

Figure 1: Conceptual framework 1

1 Is there a significant relationship between gender of respondents and their awareness PepsiCo’s customers about Vietnam counterfeiting law?

2 Is there a significant relationship between age of respondents and their awareness of PepsiCo’s customers about Vietnam counterfeiting law?

What is the respondents’

profile in terms of?

3 Is there a significant relationship between occupation of respondents and their awareness of PepsiCo’s customers about Vietnam counterfeiting law?

4 Is there a significant relationship between education level of respondents and their awareness of PepsiCo’s customers about Vietnam counterfeiting law?

5 Is there a significant relationship between civil status of respondents and their awareness of PepsiCo’s customers about Vietnam counterfeiting law?

Figure 2: Conceptual framework 2

6 Is there a significant relationship between quality inspection factor and behavior of PepsiCo’s customers?

7 Is there a significant relationship between regulation factor and behavior of PepsiCo’s customers?

8 Is there a significant relationship between customer awareness factor and behavior

Behavior of PepsiCo’s customers

depth and detail, significance of data can be neglected, responses may be inaccurate or

not fully honest

1.6 Action Plan and Target Date

1

Creating a group (Maple Group)

Together reading the scenario for understanding 01/03/2013

Lynn (leader), Snow, Jess, Key

2 Reading scenario and understanding deeply tasks in assignment

3 Looking for a company which is within the limits of the scenario

4 At home, all members had to:

- Think and choose are search title for PepsiCo

- Find any documents from books and Internet which related to

the research title

07- 09/03/2013 All members

5 Holding 1st meeting for making 3 titles 10/03/2013 All members

6 Present research title before class and asking lecturer for a title

7 The second submit titles and choose 1 research title for PepsiCo 14/03/2013 All members

8 Holding 2ndmeeting to make problem statements 16/03/2013 All members

9 Checking problem statements with lecturer 18/03/2013 Lynn

11 Meeting PepsiCo’s manager for a permission 21/03/2013 All members

12 At home, each member prepared a suitable questionnaire for the

next meeting

22 - 24/03/2013 All members

13 Holding 3rd meeting for making the questionnaire 25/03/2013 All members

14 Asking lecturer for checking the questionnaire 28/03/2013 Jess

15 Doing chapter 1:

- Leader divided works for each member with a deadline

- Members went home and did their own tasks

29 - 31/03/2013 All members

16 - Members submitted their work to leader to complete chapter 1

- Submitted total chapter 1 for lecturer to give feedbacks

- Checking and fixing together chapter 1

- Dividing new tasks of chapter 2 for all members

01 - 03/04/2013 All members

17

Doing chapter 2:

- Dividing work and doing research about chapter 2 04-07/04/2013 All members

18 All members submitted their work to leader to conduct a

- Making a plan for giving questionnaires to respondents

- Summarising the results of doing questionnaire

09 - 10/04/2013 All members

24 - Conducting a completed report including introduction,

conclusion, reference list, etc

18 - 21/04/2013 All members

27 Holding 4 th meeting

- Discuss tasks of chapter 4

- Make a plan for doing survey and assign work for each

members

11/05/2013 All members

28 Conducting survey at 5 chosen places and collect data and 13- 24/05/2013 All members

summary the results

29 Holding 5 th meeting

- Divide work about calculating in chapter 4 for each members

- Discuss and understand tasks of chapter 5

27/05/2013 All members

30 - All members submitted their work to leader to complete

chapter 4

- Submit to lecturer to receive feedbacks

- Fixing chapter 4 if there was any problems

1/06/2013 All members

28/05/2013-31 Holding 6 th meeting to divide works chapter 5 2/06/2013 All members

32 Completed chapter 5 to submit draft for lecturer to receive

33 Conducting a completed report including fixing mistakes in

chapter 1, 2 and 3; updated action plans ; introduction,

conclusion, reference list, etc

4-10/06/2013 All members

Chart 1.2: The Gantt chart for action plan of Maple Group

Chart 1.3: The Gantt chart for action plan of Maple Group

1.7 Research limitations

Our paper carries out a research into the impact of counterfeiting law on employees and customers of PepsiCo To complete the research, we had a survey from one hundred customers which include 100 customers at BigC supermarket, Vincom shopping mall, Indochina Plaza, National Economic University, and Banking Academy

Our paper also has some limitation below:

 Limitation of company support: In order to conduct the survey, we need the

manager of PepsiCo to sign a letter approval first However, PepsiCo is big company, so it is hard to contact and ask permission from the manager as well

 Time constraint: Collecting and analyzing of data need a long time for the good

result while we only have one month to complete the research, therefore, the paper cannot avoid some mistakes

 Limitation of respondents quantity: The result may be not objectiveness and

accuracy because the number of respondents is too small (100) while the number

of consumers of PepsiCo products is very wide

 Limitation of respondents support: When conducting survey, employees of

PepsiCo, many people do not agree to answer our question because they do not understand objectives of research to support it

 Limitation of words: Research is about counterfeiting law and we have difficulty

when want to analyze deeply in each case of law because of the limitation of words

 Limitation of sources: We also have difficulty when the collecting information

on the Internet and others sources because counterfeiting law is not popular in Vietnam; the State and PepsiCo also public much information about it

1.8 Research ethics

Research ethics is a set of rules, regulations, implementation which researcher need to comply; it describes the behavior and responsibility of researcher with their research objects The objective of research ethics is prescribe what researcher can or cannot to do research, determine the power and responsibilities of researcher before doing research It also protects the safety and benefit of research objects to avoid abuse To implement the study, we have to follow some ethical below:

 First, we respect the dignity, value and benefit of participant; all participants in this research are volunteers, we do not force anyone to do survey and we protect confidential communications

 We try to make them feel comfortable in helping us and when we complete results

of survey, we present all information related our survey honestly and objectivity

 Moreover, we informed fully about the purpose, methods and intended possible uses of the research to participants

 Besides, we commit that all information, data, results, methods and procedures in the research is true and reliable

 Especially, our research is about counterfeiting law, therefore we have to obey relevant laws and institutional and governmental policies

An informed consent form can be shown to participants Here is an informed consent form that group Maple used in research:

 Your participation is voluntary and we will not pay for your participation

 Your personal information will be kept secret

 If you want to contact us:

Please call (+84) 1699663898 to meet Lynn

Or sending us an e-mail: vqanh1493@gmail.com

 Result and discussion

 Conclusion and recommendation

2.1.2 Topic

The topic of our research is “Vietnam’s counterfeiting law” Counterfeiting, nowadays appear in every field and category of goods Nguyen Manh Hung, Vice President Standards Association and the Vietnamese consumer protection, said counterfeit goods, pirated goods from ordinary consumer goods such as clothing, footwear, cosmetics, glasses to the high-value goods such as televisions, refrigerators, washing machines, air conditioners, etc., materials for the production such as rice seeds, fertilizers, crop protection products, building products such as cement, building materials, sanitary ware, and even credit cards, airline tickets (Long, 2011) Through the case has been the authorities discovered that the complex nature of the production, trafficking counterfeit goods, pirated goods is increasing Act of producing counterfeit goods no longer surreptitiously and replaced by made openly in the craft village through the import of components and semi-finished products from abroad and sourcing, manufacturing, labeling of Thailand, Japan Counterfeiting are made in China and then illegally imported into Vietnam as consumption of the Rinnai gas stove, shower Joden, ear Sony player, watches, mobile phones, cameras Because of the complex and sophisticated of counterfeiting goods even smart consumers also difficult to distinguish between fake and original

products by intuitive, even the authorities have the specialized equipment, collate, verify to detect Thus, the interests of consumers and genuine business are being violated and counterfeiting, piracy is widespread Despite the increased checks, controls and many cases have been detected, but the counterfeit goods, pirated goods; commercial fraud is still a challenge for law enforcement agencies It is also the reason why we need to have laws against counterfeiting to protect the interests

of consumers and businesses as well as the economy

2.2 Articles about problem

2.2.1 Quality inspection factor

Quality inspection is an activity by performing inspections; companies are able to identify problems early with the goal of eliminating the causes Utilized correctly, inspections save money by eliminating process problems and ensuring that the end product meets customers' requirements and expectations (Product inspection, 2008) Quality inspection is very important in anti-counterfeit product in Vietnam market

It helps government identify fake product and low quality products, from that, government have situation to reduce the number of counterfeit products in market There are many research and article mention the difficulties in product quality inspection in Vietnam Vietnam’s government use some ensure quality system to evaluate the quality of product in Vietnam market such as ISO 9000, TQM (Total Quality Management), and Q.Base Although government used many systems to management quality of product, they have many difficulties in product quality inspection such as the lack of modern equipment; lack of knowledge (Tuyết) In other research, Mr.Manh said that one of the most difficulties is not enough people that have knowledge and experiences to inspect the quality of product in Vietnam market

For example, according to a survey about management market forces in Thai Binh, although in charge of the district wide with 30 - 40 communes and towns, but each team is allocated from 5 - 7 people, each manager must charge market of several communes (Mạnh) Both research above do not mention about the solution for government to develop the effects of counterfeiting law, in our research, we give some solution to deal this problem such as develop the ensure quality system,

increase human force in management market force to cover all communes in market and give strong financial institutions to decrease counterfeit products in market

2.2.2 Regulation factor

Regulation of counterfeiting law is the regulation of government to provide information about who make quality inspection, the fee that company must pay if they produce fake products and so on It is very important to protect company and customer from the effect of fake product with revenue and profit of company and benefit of customers (Anon, 2006)

Many research show counterfeit products are the result of lax management and many gaps in Vietnam counterfeiting law Currently, there are five administrative agencies functioning and competent to handle administrative violations of intellectual property including market management agencies, specialized inspectors Science - Technology, Culture, Sports and Tourism, the economic police, the Committee of the customs control of imported goods Although management forces have many people, the effort of that is not strong Because of sporadic activity, there are lack of uniformity in quality such as quantity, functions and duties between the administrative agencies functioning Although product in market is tested by the agencies mentioned above but in counterfeiting, clones, poor quality on the market

is still flooded (NTH) In addition, according to Mr Nguyen - Market Management Department (Ministry of Industry and Trade), the Standing Steering Committee 127TU said the sanctioning acts of production and trade in counterfeit goods is only handled by administrative measures or non-criminal measures It is small part of profit that counterfeit goods bring for seller (Hoa, 2010)

2.2.3 Customer awareness factor

Consumer awareness, which refers to a buyer's knowledge of a particular product or company, allows the buyer to get the most from what he buys Consumers know more about their choices when they have product information and benefit from knowing their rights, hearing about alerts and warnings and finding out about safety issues (Thomas)

Beside quality and regulation, awareness factor is also an important reason that makes counterfeit goods suffuse in market There are many research, survey and

article mention the level of citizen’s awareness in fighting against counterfeit products Many customers know goods that they buy are counterfeit goods but they still accept because the price of this product is suitable with their financial situation This activity makes fake goods develop in market and maybe make original goods decrease market share (NTH) Moreover, the limited of knowledge of customer about the counterfeit goods can make them buy counterfeit goods that they do not know

According to a survey of Vinastas, up to 62% of consumers buy counterfeit goods, counterfeit goods that they do not know (Dan, 2012) In a research of Nielsen company, rate of counterfeit goods account for about 45% of retail sales in Hanoi and 35% in Ho Chi Minh City Demand of counterfeit goods is increasing because

of economic recession It helps people understand the routine use of counterfeit products is one of major cause contributing to the uncontrolled rampant counterfeiting of the current market (Chống hàng giả/nhái: Cuộc chiến sống còn của các doanh nghiệp, 2013)

2.2.4 Activity factor

Propaganda activity is the manipulation of public opinion It is generally carried out through media that is capable of reaching a large amount of people and effectively persuading them for or against a cause The exact meaning of propaganda is constantly debated, however, and no specific definition is completely true Some argue that any persuasive communication is propaganda, while others hold that propaganda specifically alters political opinions (Anon, n.d)

Many researches show that Vietnam government and company is lack of propaganda program to help customer distinguish between original and counterfeit products On the afternoon of 11/3, Ho Chi Minh City Department of Industry and Trade launched the program in response to Consumer Day World (15/3) (Phương, 2013) Accordingly, there are many forms of communication, counseling to help consumers identify counterfeit goods It is the second propaganda program help customer during 30 years when counterfeiting goods appears in Viet Nam while the first hold more than 10 years ago; it shown that we need more and more propaganda Exhibition attract a large numbers of consumers to take are, find out

According to the organizers, this is an opportunity to help businesses involved introducing genuine products; reference guide directly with their consumers distinguish genuine goods, counterfeit goods, announced policies to protect the consumers, announced that receive complaints and consumer inquiries However, the number of items displayed to distinguish is very humble; just climb around the helmet, toilet paper, masks, lotions, disproportionate market realities It shown that many company feel hesitate so they do not want to show their products

According to another survey conducted by the Protection of Consumers Association (2013), they will sign agreements and commitments awarded certified implementing policies to protect consumers from producers, distributors, and organize workshops between businesses and consumers with the State management in order to find the right solution for consumers increasingly popular widely throughout society

2.2.5 Living standard factor

Living standard is the level of wealth, comfort, material goods and necessities available to a certain socioeconomic class in a certain geographic area The standard

of living includes factors such as income, quality and availability of employment, class disparity, poverty rate, quality and affordability of housing, hours of work required to purchase necessities, gross domestic product, inflation rate, number of vacation days per year, affordable (or free) access to quality healthcare, quality and availability of education, life expectancy, incidence of disease, cost of goods and services, infrastructure, national economic growth, economic and political stability, political and religious freedom, environmental quality, climate and safety The standard of living is closely related to quality of life (Investopedia)

In fact, we cannot prevent counterfeiting development because the majority of people with low and middle incomes will accept and prefer cheap goods brand While, tricks and techniques produce increasingly sophisticated fakes, are closed from production, transportation and circulation, extensive distribution from urban to rural, remote areas

"Low-income people of Vietnam love using counterfeit" is the result of the survey

by Research Company Nielsen in Vietnam, was published the morning 16/9 in Ho Chi Minh City (VNPlus, 2009) Survey "Research attitudes and usage of Vietnam

against counterfeiting - consumer objects and retailers" to see the garments accounted for the largest share of fakes in the market of Ho Chi Minh (mostly domestic goods), while in Hanoi restaurant appliances and pharmaceuticals (mainly from China).Buyers are mostly women, mostly aged 25-34, most career falls into self-employment and income

According to other survey of Department of Intellectual Property, the rate of buyer

in Hanoi use fake pharmaceuticals accounted for 47% of household appliances account for 37% Meanwhile, the percentage of counterfeit apparel buyers in Ho Chi Minh City accounted for approximately 27% for aviation enthusiasts who buy luxury goods Before consumers still prefer the use of counterfeit, retailers optimistic that demand for counterfeit goods will increase in the next 12 months, so they will continue to sell as long is increasing revenue for the store

2.3 Conclusion

To sum up, all information above shown that counterfeiting products is a serious problem which damaged companies as well as consumers Negative consequences that it brings to society such as affecting health, consumer finance, undermine consumer confidence in the transparency of commodity markets, diminished followers of the true manufacturer Until now, we do not have any study about impact of counterfeit goods to a specific company It is difficult for us to identify the specific harmful of counterfeit goods to company and all statistics is public by government This research illustrate on the situation of PepsiCo about this problem because PepsiCo is a famous brands and its products is easy to counterfeit Then, it will be much easier for PepsiCo to find out the solutions to prevent counterfeiting

CHAPTER 3

RESEARCH METHODOLOGY

The system of collecting data for research projects is known as research methodology The data may be collected for either theoretical or practical research for example management research may be strategically conceptualized along with operational planning methods and change management Some important factors in research methodology include validity of research data, Ethics and the reliability of measures most of your work is finished by the time you finish the analysis of your data (Tutors India, 2013) The process used to collect information and data for the purpose of making business decisions The methodology may include publication research, interviews, surveys and other research techniques, and could include both present and historical information (Business Dictionary, 2013)

3.1 Research Design

3.1.1 Type of research

There are 3 types of research: Exploratory research, Descriptive research, Causal research Our research type is Descriptive research Descriptive research is considered

as survey research It collects data in order to answer questions about the current status

of the subject or topic of study, and uses formal instruments to study preferences, attitudes, practices, concerns, or interests of a sample In order words, descriptive research involves collecting data in order to test hypotheses or to answer questions about the opinions of people about the topic or issue (villanova.edu, n.d.)

There are basic 6 steps in conducting descriptive research is recognizing and identifying

a topic to be studied, selecting an appropriate sample of participants, collecting valid and reliable data, and reporting conclusions (villanova.edu, n.d.)

3.1.2 Research method

There are 2 types of research design which are qualitative research and quantitative

research: Quantitative research is the standard experimental method of most scientific disciplines and Qualitative research is a research method used extensively by scientists

and researchers studying human behavior and habits

We use Quantitative research design to conduct this research Quantitative research

designs are either descriptive (subjects usually measured once) or experimental (subjects measured before and after a treatment) (Hopkins, 2008) A descriptive study establishes

only associations between variables An experiment establishes causality For an accurate estimate of the relationship between variables, a descriptive study usually needs

a sample of hundreds or even thousands of subjects; an experiment, especially a crossover, may need only tens of subjects (Hopkins, 2008) The estimate of the relationship is less likely to be biased if you have a high participation rate in a sample selected randomly from a population In experiments, bias is also less likely if subjects are randomly assigned to treatments, and if subjects and researchers are blind to the identity of the treatments In all studies, subject characteristics can affect the relationship you are investigating Limit their effect either by using a less heterogeneous sample of subjects or preferably by measuring the characteristics and including them in the analysis In an experiment, try to measure variables that might explain the mechanism of the treatment (Hopkins, 2008)

3.1.3 Research Design Technique

PepsiCo methods are applied by opening a small survey 100 random customers with

simple multiple choice questions such as "Yes or No", "Agree, Disagree, and Normal" Then, PepsiCo attempts to gather information have been issued to 100 customers in Vincom shopping mall center, BigC supermarket, Indochina Plaza, National Economic University, and Banking Academy to review The system of collecting data for research projects is known as research methodology The data may be collected for either theoretical or practical research for example management research may be strategically conceptualized along with operational planning methods and change management Some important factors in research methodology include validity of research data, Ethics and the reliability of measures most of your work is finished by the time you finish the analysis of your data The process used to collect information and data for the purpose of making business decisions The methodology may include publication research, interviews, surveys and other research techniques, and could include both present and historical information This research focused on analyzing the impact of counterfeiting law on customers of PepsiCo Studies are built on data collected after the survey of 100 people in Vincom shopping mall center, BigC supermarket, Indochina Plaza, National Economic University, and Banking Academy In addition, data is collected through the

books, newspapers, magazines, and internet

3.2 Research Sampling

 Participants

PepsiCo collect data and review of information based on a survey of 100 random customers in Vincom shopping mall center, BigC supermarket, Indochina Plaza, National Economic University, and Banking Academy

 20 customers in Vincom shopping mall center: 191 Ba Trieu, Hai Ba Trung, Ha Noi

 20 customers in National Economic University: 207 Tran Dai Nghia, Ha Noi

 20 customers in BigC supermarket: 222 Tran Duy Hung, Cau Giay, Ha Noi

 20 customers in Banking Academy: 12 Chua Boc, Dong Da, Ha Noi

 20 customers in Indochina Plaza: 239 XuanThuy, Cau Giay, Ha Noi

The question was brought to customers by leaflets with simple questions This method has many advantages such as cost reduction more than organization one program to know opinions customers, and saving customer time because of interview is faster with these multiple questions and simple choice Collect information quickly and direct feedback, opinions from customers such as price, product quality All result is also objective due to respondents are chosen at random

 Sampling method

There are three main type of research sampling includes: random sampling,

random sampling, and non- random sampling Our group decided to choose the random sampling to conduct the survey “Quasi-random sampling, which provides a

quasi-good approximately to random sampling, necessitates the existence of a sampling frame” (BPP, n.d.) There are many advantages of random sampling: simple to use, is consider like a fair method of taking samples from a certain population because each member is provided equal chances of being chosen, and enable researches to draw clear conclusions from results gotten from the study (benefitof.net, n.d.) Therefore, this research sampling helps our team to get the opinion of real customers about affect of Vietnam counterfeiting law on awareness and behavior of PepsiCo’s customer It also means the result of survey will be more reliable

3.3 Research instrument

In order to collect and analyze the data effectively, the questionnaire is designed on one A4 page including 20 questions related to the research title divided into 2 main parts:

 Part I (from question 1 to question 5): Profile of customers, including genders, age,

occupation, education level, and civil status The response format is design with fixed response: multiple choices The answers of these questions will identify the attitude, awareness, and reaction of each group of customers because different age groups, genders, occupation and education level will have different awareness about Vietnam counterfeiting law

 Part II (from 6 to question 20): Evaluate the impact of Vietnam counterfeiting law on

customer’s behavior Almost of these 15 questions use Likert scale questions with 5 levels of evaluation, except for question 6, 7, 8, 9, 11

Likert scale questions are listed in the following table:

Question 10

Never

(0-2)

Rarely (2-4)

Sometimes (4-6)

Often (6-8)

Always (8-10)

Question 12

I do not care

(0-2)

Never heard it (2-4)

Normal (4-6)

Good (6-8)

Very good (8-10)

Question 13

Strongly do not

believe (0-2)

Do not believe (2-4)

Normal (4-6)

Believe (6-8)

Strongly believe (8-10)

Question 14

Extremely

dissatisfied (0-2)

Dissatisfied (2-4)

So-so ( 4-6)

Satisfied (6-8)

Extremely satisfied (8-10)

Neutral (4-6)

Agree (6-8)

Strongly agree (8-10)

Question 17

Very bad

(0-2)

Bad (2-4)

So-so (4-6)

Good (6-8)

Very good (8-10)

Question 19, 20

Strongly disagree

(0-2)

Disagree (2-4)

Normal (4-6)

Agree (6-8)

Strongly agree (8-10) Table 3.1: Research Instrument

Nominal question is listed as follows:

Interval question is listed as follows

Question 2

Question 7

Less than 3 times 4-6 times 7-9 times More than 10 times

Ordinal question is listed as follows

From 5-10 million VND

Over 10 million VND

3.4 Data gathering procedure

The procedure of gathering data consists of gathering from primary data and gathering from secondary data Primary data is a data which is created for the first time and there is no previous source available Secondary data is a readily available data like data from website, internet (answers.com, n.d.) In this research, the researchers use survey to collect primary data, and a lot of information from website, internet, books, and newspapers to collect secondary data Objectives of each step in making survey and search information from sources will be describes in the following table

of PepsiCo’s customer” Therefore, it is very easy for respondents to answer it This is also most important thing is to help researchers easily in collecting the data

Doing survey

Before conducting the survey, it is very important for the researchers to explain for respondents about the purposes of the survey This thing will help them understand and be willing to answer and support the research

Collecting, analyzing and

reporting

The last step in this process of gathering primary data is collect, analyze and report the results By calculating exactly the data by suitable formula, researcher can analyze the results to discuss and give out opinions, comments why respondents choose this answer From that, researcher can draw conclusions about the impact of Vietnam counterfeiting law on customers’ behavior Table 3.2: Collecting primary data

Books

Books are precious sources for any research, especially research related to law Almost policy related to Vietnam counterfeiting law is listed briefly in books It helps researcher to find out the useful information to support the research

Internet

Internet is abundant, available source It helps researchers search information quickly through key words Besides online books are uploaded free in the internet, internet also contained many opinions, ideas from bloggers in many websites It is a useful information source for researcher to compare and contrast their opinion together in literature review

Newspapers/ Magazines

The articles in newspapers or magazines about Vietnam counterfeiting law is reliable information All information is written by journalist, and their comments are also highly valued in this study

Table 3.3: Collecting secondary data 3.5 Methods of Data Analysis

There are 3 methods to analysis data; these are frequency distribution, weighted mean, and correlation coefficient

a) Frequency distribution

 Definition: Frequency distribution is a statistic method to illustrate and simplify a

large set of data It is simply a method of organizing and simplifying the data to make it more understandable (Ali, n.d.)

 Advantage of frequency distribution

- To organize the data in a meaningful way

- To determine the nature or shape of the distribution

- To compute measures of central tendency, variation, and position

- To make comparisons among different data sets

- To draw charts and graphs for data presentation (Ali, n.d.)

b) Weighted mean

 Definition: The weighted mean is similar to an arithmetic mean (the most

common type of average), where instead of each of the data points contributing equally to the final average, some data points contribute more than others (princeton, n.d.)

 Advantage of weighted mean

- Allows the final average number to reflect the relative importance of each number that is being averaged

- Easy to evaluate the data and give conclusion (ehow, n.d.)

c) Correlation coefficient

 Definition: Correlations are a simple form of statistical analysis that looks for

numerical relationships between two equally sized data sets By comparing numbers from two different data sets together, correlations look at how movement

in the value of numbers in one data set is related to movement in the value of

numbers in the other data set (McDunnigan, n.d.)

 Advantage of correlation coefficient

- Looking for simple correlations between two data sets

- Precise information about the degree of the relationship can be established by the correlation coefficient

- No manipulation of behavior is required

- Establishing a relationship between the 2 variables may imply that there could

be a cause and effect relationship Further experimental research can be conducted to establish cause and effect (revisionworld, n.d.)

From methods of data analysis, researchers applied for each question as following table:

Question 4: Education level

Question 5: Civil status

Question 8: Distinguish between

original and counterfeit product

Question 9: Vietnam counterfeiting

law

Question 11: Action of customer when

buy counterfeit product

Question 10: Assessment of customers

about registering sufficient personal

information for product suppliers

n: number of respondents Question 12: Does PepsiCo state

copyright stamp, product code on the

product to distinguish between original

and fake products?

fnh: frequency for never heard it fn: frequency for normal fg: frequency for good fvg: frequency for very good n: number of respondents

Question 16: Human greed is a factor

leading to appearances of counterfeit

product in the market?

Question 17: Evaluation about

product’s quality inspection stage of

government agencies and PepsiCo

n: number of respondents

a Question 19: PepsiCo hold propaganda

programs to help customers

distinguishing original and counterfeit

Question 20: PepsiCo has many

policies to ensure legal benefits of

customers?

fd: frequency for disagree fn: frequency for normal fa: frequency for agree fsa: frequency for strongly agree n: number of respondents

c Question 13 and question 14: The

relationship between the belief in

product’s quality and level of

satisfaction about the prices of PepsiCo

products of customers

Correlation coefficient

]2)y(-y²[n

2]

)x(-x²[

b = 2 2

)(

n

y x xy n

a = Σy - b Σx

n

We have the straight line under the equation: y = ax + b x: is the mid- point of question 13

y: is the mid- point of question 14

d Question 15 and question 18: The

relationship between customers’

awareness about counterfeiting law and

evaluation of customer about power of

Vietnam counterfeiting law in

protecting customer and PepsiCo

company

Correlation coefficient

]2)y(-y²[n

2]

)x(-x²[

b = 2 2

)(

n

y x xy n

e Question 1 and question 15: Is there a

significant relationship between gender

of respondents and their awareness

PepsiCo’s customers about Vietnam

counterfeiting law?

= Observed frequencies = Expected frequencies = ∑

Degrees of freedom = (M-1) × (N-1) With N: Number of rows

M: Number of columns

f Question 2 and question 15: Is there a

significant relationship between age of

respondents and their awareness of

PepsiCo’s customers about Vietnam

counterfeiting law?

= Observed frequencies = Expected frequencies = ∑

Degrees of freedom = (M-1) × (N-1) With N: Number of rows

M: Number of columns

g Question 3 and question 15: Is there a

significant relationship between

occupation of respondents and their

awareness of PepsiCo’s customers

about Vietnam counterfeiting law?

= Observed frequencies = Expected frequencies = ∑

Degrees of freedom = (M-1) × (N-1) With N: Number of rows

M: Number of columns

h Question 4 and question 15: Is there a

significant relationship between

education level of respondents and their

awareness of PepsiCo’s customers

about Vietnam counterfeiting law?

= Observed frequencies = Expected frequencies = ∑

Degrees of freedom = (M-1) × (N-1) With N: Number of rows

M: Number of columns

Question 5 and question 15: Is there a

significant relationship between civil

status of respondents and their

awareness of PepsiCo’s customers

about Vietnam counterfeiting law?

i

= Observed frequencies = Expected frequencies = ∑

Degrees of freedom = (M-1) × (N-1) With N: Number of rows

M: Number of columns

Question 13 and question 17: Is there

a significant relationship between

quality inspection factor and behavior

of PepsiCo’s customers?

= Observed frequencies = Expected frequencies = ∑

Degrees of freedom = (M-1) × (N-1) With N: Number of rows

M: Number of columns

Question 13 and question 20: Is there

a significant relationship between

regulation factor and behavior of

PepsiCo’s customers?

= Observed frequencies = Expected frequencies = ∑

Degrees of freedom = (M-1) × (N-1) With N: Number of rows

M: Number of columns

Question 10 and question 15: Is there

a significant relationship between

customer awareness factor and behavior

of PepsiCo’s customers?

= Observed frequencies = Expected frequencies = ∑

Degrees of freedom = (M-1) × (N-1) With N: Number of rows

M: Number of columns