Influencing factors to buying decision of cement product for housing construction in ho chi minh city master project in business administration

4.2 Overview of cement industry 31 4.3 Market share 33 4.4 Cement distribution system 35 CHAPTER 5: ANALYSIS OF RESEARCH DATA & RESULTS 37 5.1 Respondent’s information 37 5.2 Descript

MBAVB1

TRAN CAO TUAN

INFLUENCING FACTORS TO BUYING DECISION OF CEMENT PRODUCT FOR HOUSING CONSTRUCTION

IN HO CHI MINH CITY

MASTER PROJECT MASTER IN BUSINESS ADMINISTRATION

(PART-TIME)

Ho Chi Minh City

(2010)

ACKNOWLEDGMENT OF COMMITMENT

I, Tran Cao Tuan, would like to confirm that I have prepared and conducted this

“Influencing factors to buying decision of cement product for housing construction in Ho Chi Minh City” as the final project of MBAVB program

ACKNOWLEDGEMENT

I sincerely express my deep gratefulness to Professor Michele Allele of Solvay University in Belgium and Doctor Tran Anh Tuan, the program co-director, who have whole-heartedly organized the Vietnam-Belgium management MBAVB1 course successfully

I would like to express my sincere gratitude to Dr Nguyen Van Phuc, research advisor for the valuable guidance, constructive comments and encouragement through out the research study

Especially, I would like to give my special thanks to my family who enabled

me to complete this project

Ho Chi Minh City, 30th December, 2010

Tran Cao Tuan

TABLE OF CONTENTS

Page LIST OF TABLES x

LIST OF FIGURES xii

LIST OF ABBREVIATION xiii

ABSTRACT 01

CHAPTER 1: INTRODUCTION 02

1.1 Problem statement 02

1.2 Research objective 02

1.3 Scope of research 02

1.4 Research methodology 03

1.5 Structure of the project 03

CHAPTER 2: LITERATURE REVIEW 05

2.1 Definition 05

2.2 Buying decision process 05

2.2.1 Buying roles 05

2.2.2 Buying behavior 06

2.3 Stages of the buying decision process 08

2.3.1 Problem recognition 09

2.3.2 Information search 09

2.3.3 Evaluation of alternatives 10

2.3.4 Purchase decision 11

2.3.5 Post purchase behavior 12

2.4 Purchase cases 13

2.5 Influcing buyer behaviour 14

2.5.1 Cultural factors 15

2.5.2 Social factors 16

2.5.3 Personel factors 16

2.5.4 Psychological factors 18

2.6 Selection criteria 18

2.7 Proposed research model 19

CHAPTER 3: RESEARCH DESIGN 21

3.1 Research methodology 21

3.1.1 Qualitative research 21

3.1.2 Quantitative research 22

3.2 Result of qualitative research 23

3.3 Quantitative research 24

3.3.1 Setting up, building and evaluating the scale of measurement 24

3.3.1.1 Scale of variables relative to willingness of buying cement 24 3.3.1.2 Scale of the other groups of variables 24

3.3.2 Evaluating the scale of measurement and filtering data gathered

from questionnaire 26

3.3.2.1 Evaluating the scale of measurement 26

3.3.2.2 Filtering data gathered from questionnaire 26

3.3.3 Data analysis process 27

3.3.4 Size of sample 28

CHAPTER 4: OVERVIEW OF CEMENT MARKET IN VN 29

4.1 Overview of Vietnamese economic environment 29

4.2 Overview of cement industry 31

4.3 Market share 33

4.4 Cement distribution system 35

CHAPTER 5: ANALYSIS OF RESEARCH DATA & RESULTS 37

5.1 Respondent’s information 37

5.2 Descriptive statistics result of quantitative variables 38

5.3 Reliability statistics (Cronbach’s Alpha) 39

5.3.1 Reliability statistic Cronbach’s Alpha for the group of variables relative to brand name of product 41

5.3.2 Reliability statistic Cronbach’s Alpha for the other groups of variables 41

5.4 Exploratory factor analysis (EFA) 44

5.5 Paired-Samples T Test 47

5.6 Result analysis 50

CHAPTER 6: CONCLUSIONS & RECOMMENDATIONS 53

6.1 Conclusions 53

6.2 Recommendations 53

6.3 The strength, weakness, limitation of this study and

recommendation for future study 55

REFERENCES 57

1 English Language Sources 57

2 Vietnamese Language Sources 60

APPENDIX 61

Appendix 1: Discussion framework form 61

Appendix 2: Questionnaire for customer 62

Appendix 3: Reliability statistics results (Cronbach’s Alpha) 66 Appendix 4: Result of EFA analysis 69 Appendix 5: Result of Paired-Samples T Test 72

LIST OF TABLES

Table 5.4: Summary of initial groups of variables will be analyzed 39

Table 5.5: Results of reliability statistics for variables relative to brand

name of product

41

Table 5.6: Results of reliability statistics for other groups of variables 42

Table 5.7: Summary of groups of variables after rejecting some variables

in the stage of reliability statistics

42

LIST OF FIGURES

Figure 2.4: Steps between evaluation of alternatives and a purchase

decision

11

LIST OF ABBREVIATION

HCMC: Ho Chi Minh City

EFA: Exploratory Factor Analysis FDI: Foreign Direct Investment

ABSTRACT

Cement is one of the important construction materials The demand of cement is increasing rapidly because the development of housing construction in Hochiminh city is increasing, that is the aim of this research to know the important factors influencing decision making in buying cement for housing construction as well as infrastructure in Hochiminh city

This research “ Influencing factors to buying decision of cement product for housing construction in HCMC” aims at analyzing factors influencing decision making in buying cement The results have 06 groups of influencing factors

These are Brand name, quality, customer services, price, delivery service, manufacturer ‘s capacity

After finding out groups of influencing factors, Paired-Samples T Test is used to

assess the influence level of these groups Based on the results, we can conclude

that important level of these groups from highest to lowest : Price, Delivery service, Quality, Brand name, Customer service and Manufacturer ‘s capacity

CHAPTER 1 INTRODUCTION

1.1 Problem Statement

Cement is one of the important construction materials The development of housing construction in HCMC has increased very quickly at present Therefore, the demand of cement as well as other construction material is increasing rapidly Demand of cement in 2009 was 45.5 Mil ton and 2010 is about 51 Mil ton (11% increased) With severe competition in cement business, it is necessary

to know which are the most important factors influencing customer’s decision in buying cement for housing building So, the objective of this research is to find out these factors

1.2 Research objectives

To find out important factors influencing customer decision

To recommend some solutions for cement manufacturers to meet customer‘s requirement as well as for new retailers to select better cement manufacturer

1.3 Scope of research

The object of study is cement retailers and small contractors in HCMC

The ones chosen for interviews are those who are the owner and key person who made decision or have influence to buy cement for end user (the owner of house) Because cement product is normally decided by contractor and /or retailer Therefore, they are represented as customer Limit of research place is

within HCMC and not big contractor such as state contractor, corporation (as organization buyers)

1.4 Research methodology

Desk research : Collecting data as internal data base through public sources such as internet, news paper, relevant books and previous related research

Survey research : There are two stage as follow

Qualitative research : face-to-face discussion method, the sample size is from 5

to 8 persons From the result of the qualitative research, the researcher finds out elements which are needed to modify initial model (if necessary) so that the official model is used to design a questionnaire for the quantitative research

Quantitative research : This research is done by questionnaires in which the result are for analyzing all factors and figure out the level of influencing each factors This research is carried out by SPSS software 16.0

1.5 Structure of the project

There are 06 chapters as follow :

Chapter 01: Introduction

This chapter provides the problem statement in order to make this research It also provides the methodology, objective and scope of this research

Chapter 02: Literature review

This chapter provides the understanding of the concepts of customer behavior and theories that can propose model research for the study “Influencing factors

to buying decision of cement products for housing construction in HCMC”

Chapter 03: Research design

This chapter provides the implementation of design the research, preliminary research result and research sample

Chapter 04 : Overview of Cement market in Vietnam

This chapter provides general information about Vietnamese environment such

as economic development situation, demographic factors (average income, GDP) and overview of development of cement industry as well as market share

Chapter 05: Analysis of research data and result

This chapter provides analysis result through Descriptive Statistics, Exploratory Factor Analysis, Reliability evaluation through Cronbach ‘s Alpha, Pair T Test

Chapter 06: Conclusions and recommendations

From the research result, this chapter provides the conclusion and some recommendations of some solution and proposes some suggestion which is needed to set up new retailer in near future This chapter also mentioned the limitation of this project

CHAPTER 2 LITERATURE REVIEW 2.1 Definition

According to Richard L Sandhusen (2000, p 218), Consumer behavior is the study of when, why, how, and where people do or do not buy products

Belch GE and Belch MA(2007, p 105) define consumer behavior as 'the process and activities people engage in when searching for, selecting, purchasing, using, evaluating, and disposing of products and services so as to satisfy their needs and desires'

According to Philip Kotler (2002, p 200), We can distinguish five roles people

play in a buying decision : Initiator : the person who first suggests the idea of buying the product or service Influencer : the person whose view or advice influences the decision Decider : the person who decides on any component of a

buying decision (whether to buy, what to buy, how to buy and where to buy)

Buyer : the person who makes the actual purchase User : the person who

consumes or uses the product or services

2.2 Buying decision process

2.2.1 Buying roles

According to Philip Kotler (2002, p 200), it is easy to identify the buyer for many products In the United State, men normally chose their shaving equipment

and women chose pantyhose But even here marketer must be careful in making their targeting decisions because buying roles change

2.2.2 Buying behavior

According to Philip Kotler (2002, p 182), the field of consumer behavior studies how individuals, groups and organizations select, buy, use and dispose of goods, services, ideas or experience to satisfy their needs and desires Understanding consumer behavior and “knowing customers” is never simple Customers may say one thing but they do another thing, they may not be in touch with their deeper motivations They may respond to influences that change their minds at the last minute Consumer ‘s buying behavior is influenced by cultural, social, personal and psychological factors

According to Philip Kotler (2002, p 183), the starting point for understanding

buyer behavior is the stimulus –response model shown in Figure 2.1 below:

Figure2.1: Model of buyer behavior

Buyer's characteristics Cultural Social Personal Psychological

Buyer's decision process Information search Evaluation of alternatives Purchase decision Postpurchase behavior

Buyer's decision Product choice Brand choice Purchase timing Purchase amount

Buyer's characteristics Cultural Social Personal Psychological

Buyer's decision process Information search Evaluation of alternatives Purchase decision Postpurchase behavior

Buyer's decision Product choice Brand choice Purchase timing Purchase amount

Refer to the above figure 2.1, customer decision making varies with the type of buying decision The decisions to buy toothpaste, a tennis racket, a personal computer, and a new car are all different Complex and expensive purchases are likely to involve more buyer deliberation and more participants Henry Assael distinguished four types of customer buying behavior, based on the degree of buyer involvement and the degree of differences among brands.(2.1) (see Figure 2.2).

Figure 2.2: Four types of buying behavior

High involvement Low involvement

Habitual buying behavior

(Source: modified from Henry Assael, (1987) “Consumer behavior and Marketing action”

by Wadsworth, Inc.)

Philip Kotler (2002, p 201) said that Complex buying behavior involves a

three-step process First, the buyer develop beliefs about the product Second, he or she develops attitudes about the product Third, he or she make a thoughtful choice Consumers engage in complex buying behavior when they are highly involved in a purchase and aware of significant differences among brands This

is usually the case when the product is expensive, bought infrequently, risky and highly self-expressive

2.3 Stages of the buying decision process

Philip Kotler, (2002, p 204), “the model in Figure 2.3 implies that consumers

pass through all five stages in buying a product, but this is not the case: Consumers may skip or reverse some stages A woman buying her regular brand

of toothpaste goes directly from the need for toothpaste to the purchase decision, skipping information search and evaluation However, we will use the model in

Figure 2.3 because it captures the full range of considerations that arise when a

customer faces a highly involving new purchase” (2.2)

Figure 2.3: Five-stage Model of the Consumer Buying Process

Problem regconition

Evaluation of alternatives Information search

Purchase decision

Postpurchase behavior

Philip Kotler, (2002, p 202) “How can marketers learn about the stages in the buying process for their product? They can think about how they themselves

would act (introspective method) They can interview a small number of recent

purchasers, asking them to recall the events leading to their purchase

(retrospective method) They can locate consumers who plan to buy the product

and ask them to think out loud about going through the buying process

(prospective method); or they can ask consumers to describe the ideal way to buy

the product (prescriptive method) Each method yields a picture of the steps in

Philip Kotler, (2002, p 204), said “An aroused customer will be inclined to search for more information We can distinguish between two levels of arousal The milder search state is called heightened attention At this level a person

simply becomes more receptive to information about a product At the next

level, the person may enter an active information search: looking for reading

material, phoning friends, and visiting stores to learn about the product”

Philip Kotler, (2002, p 204), “the relative amount and influence of these information sources vary with the product category and the buyer’s characteristics Generally speaking, the consumer receives the most information about a product from commercial sources – that is, marketer-dominated sources However, the most effective information comes from personal sources Each information source performs a different function in influencing the buying-decision Commercial information normally performs an informing function, and personal sources perform a legitimizing or evaluation function”

“Through gathering information, the consumer learns about competing brands and their features The individual consumer will come to know only a subset of these brands (awareness set) Some brands will meet initial buying criteria (consideration set) As the person gathers more information, only a few will remain as strong contenders (choice set) The brands in the choice set might all

be acceptable The person makes a final choice from this set.”(2.3)

2.3.3 Evaluation of alternatives

Philip Kotler, (2002, p 205) said “How does the consumer process competitive brand information and make a final value judgment? There is no single process used by all consumers or by one consumer in all buying situations There are several decision evaluation processes First, the consumer is trying to satisfy a need Second, the consumer is looking for certain benefits from the product

solution Third, the consumer sees each product as a bundle of attributes with varying abilities for delivering the benefits sought to satisfy this need The attributes of interest to buyers vary by product”

2.3.4 Purchase decision

Philip Kotler, (2002, p 207), “In the evaluation stage, the consumer forms preferences among the brands in the choice set The consumer may also form an intention to buy the most preferred brand However, two factors can intervene between the purchase intention and the purchase decision “(2.4) (see figure 2.4)

Figure2.4 : Steps between Evaluation of Alternatives and a Purchase Decision

The first factor is the attitudes of others The extent to which another person’s attitude reduces one’s preferred alternative depends on two things: (1) the intensity of the other person’s negative attitude toward the consumer’s preferred alternative and (2) the consumer’s motivation to comply with the other person’s wishes(2.5) The more intense the other person’s negativism and the closer the other person is to the consumer, the more the consumer will adjust his or her purchase intention The converse is also true: A buyer’s preference for a brand

Evaluation of

alternatives

Purchase Intention

Attitudes of others

Unanticipated situational factors

Purchase Decision

will increase if someone he or she respects favors the same brand strongly The influence of others becomes complex when several people close to the buyer hold contradictory opinions and the buyer would like to please them all”

“Related to the attitudes of others is the role played by infomediaries who

publish their evaluations Consumers are undoubtedly influenced by these evaluations A consumer’s decision to modify, postpone, or avoid a purchase

decision is strongly influenced by perceived risk (2.6) The amount of perceived risk varies with the amount of money at stake, the amount of attribute uncertainty, and the amount of consumer self-confidence Consumers develop routines for reducing risk, such as decision avoidance, information gathering from friends, and preference for national brand names and warranties Marketers must understand the factors that provoke a feeling of risk in consumers and provide information and support to reduce the perceived risk”

“In executing a purchase intention, the consumer may make up five purchase

sub-decisions: a brand decision, vendor decision, quantity decision, timing decision, and payment-method decision Purchases of everyday products involve

fewer decisions and less deliberation For example, in buying sugar, a consumer gives little thought to the vendor or payment method”

2.3.5 Post purchase behavior :

Belch, GE and Belch, MA (2007, p, 120-6), Once the consumer has purchased and used the product, they will evaluate their purchasing decision They compare the product's performance with their expectations If the product does not perform as expected they will experience post purchase dissatisfaction

According to Philip Kotler, (2002, p 208), after purchasing the product, the consumer will experience some level of satisfaction of dissatisfaction Marketer must monitor post purchase satisfaction, post purchase actions and post purchase product uses

A straight re-buy refers to a situation in which the buying is a routine action,

conducted by the buying department (for example: raw material) The buyer chooses a provider from an “approved list”, counting on their satisfaction from the previous buy In this situation, the former providers (the chosen ones) try to maintain their product/ service quality Those who are not chosen try to offer a new product or take advantage of the situation in which the buyer is not very satisfied, thus will be likely to consider buying some of their products or

services Afterwards they will make efforts to gradually increase the “buying percentage” of the buyer

Modified re-buy refers to a situation in which the purchaser wants to change the

qualifications, price, delivery request or other conditions This kind of buying situation usually relates to the decision of the organization such as changing in

personnel, numbers of staff which has been changed, etc In this case, the formers providers will worry and try to find ways to maintain customers This

buying situation is an opportunity for those providers who “are not chosen”

New buy is the case in which the purchaser buys goods or service for the first

time The more expensive the expenses or risks relevant to the purchase is, the more people join the routine and purchase decision

In sum, there are three types of buying situations, which are new buy, modified re-buy and straight re-buy The case for our study is modified re-buy with

changing and without changing is more popular than other situations Because End-users and House owners when they build house, they need to contact the Cement retailers as well as Contractors to get advise Both of them always use this material for supply and construction, Re-buy situation is often used However, it will be changed to other suppliers because many factors such as Price, Quality, Services … will be affected to them for making buying decision

2.5 Influencing buyer behavior

Philip Kotler, (2002, p 183), the starting point for understanding buyer behavior

is the model shown in the Figure 2.1 above The buyer’s characteristics and

decision process lead to certain purchase decisions A consumer’s buying behavior is influenced by cultural, social, personal, and psychological factors Cultural factors exert the broadest and deepest influence

There are two types of buyer behavior, those are individual buyer behavior and business buyer behavior In the scope of this research, the individual buyer behavior will be selected for research

2.5.1 Cultural factors

Philip Kotler, (2002, p 183), “culture, subculture and social class are particularly important in buying behavior Culture is the fundamental determinant of a person’s wants and behavior”

Philip Kotler, (2002, p 184) “Social classes reflect not only income, but other indicators such as occupation, education and area of residence Social classes differ in dress, speech patterns, recreational preferences, and many other characteristics”

This factor reflect to buying behavior of customer for construction material as well as cement Customer ‘s income is reflected to decision because it is costly for them to build their house Location of residence is also affected to customer’s behavior Customer will select cement products which is suitable for their area such as Mekong Delta, weak soil conditions…

2.5.2 Social factors

Philip Kotler, (2002, p 184), “In addition to culture factors, a consumer’s behavior is influenced by such social factors as reference groups, family and social roles and statuses”

Customer also concern about social responsibility from cement suppliers and manufacturers They will follow group ‘s reference in order to buy construction materials

2.5.3 Personal factors

Philip Kotler, (2002, p 190), A buyer’s decision is also influenced by personal characteristics These include buyer’s age and stage in the life cycle, occupation, economic circumstances, life style, personality and self-concept Age and Stage

in life cycle, people buy different goods and services over a lifetime Consumption is shaped by the family life cycle There are nine stages of family

life cycle listed in table 2.5 for reference

Table 2.5: Stages in family life cycle

1 Bachelor stage: Young, single, not living at home Few financial burdens Fashion

opinion leaders Recreation oriented Buy: basic home equipment, furniture, cars, equipment for the mating game, vacations

2 Newly marriage

couples:

Young, no children Highest purchase rate and highest average purchase of durables: cars, appliances, furniture, vacations

3 Full nest I: Youngest child under six Home purchasing at peak Liquid assets

low Interested in new products, advertised products Buy: washers, dryers, TV, baby food, chest rubs and cough medicines,

vitamins, dolls, wagons, sleds, skates

4 Full nest II: Youngest child six or over Financial position better Less

influenced by advertising Buy larger-size packages, multiple-unit deals Buy: many foods, cleaning materials, bicycles, music lessons, pianos

5 Full nest III: Older married couples with dependent children Financial position

still better Some children get jobs Hard to influence with advertising High average purchase of durables: new, more tasteful furniture, auto travel, unnecessary appliances, boats, dental services, magazines

6 Empty nest I: Older married couples, no children living with them, head of

household in labor force Home ownership at peak Most satisfied with financial position and money saved Interested in travel, recreation, and self-education Make gifts and contributions Not interested in new products Buy vacations, luxuries, home improvements

7 Empty nest II: Older married No children living at home, head of household

retired Drastic cut in income Keep home Buy: medical appliances, medical-care products

8 Solitary survivor: In labor force Income still good but likely to sell home

9 Solitary survivor: Retired Same medical and product needs as other retired group;

drastic cut in income Special need for attention, affection, and security

Sources: William D Wells and George Gubar, “Life cycle concepts in Marketing Research,” Journal of Marketing Research (November 1966): 362 Also see Patrick E Murphy and William A Staples, “A Modernized Family Life Cycle,” Journal of Consumer Research (June 1979): 12-22; Frederick W Derrick and Alane E Linfield,

“The Family Life Cycle: An Alternative Approach,” Journal of Consumer Research

(September 1980): 214-17

2.5.4 Psychological factors

Philip Kotler, (2002), “a person’s choices are influenced by four major

psychological factors - motivation, perception, learning, beliefs and attitudes

Beliefs and attitudes: through doing and learning, people acquire beliefs and

attitudes, these in turn influence buying behavior A belief is a descriptive

thought that a person holds about something People’s beliefs about a product or

brand influence their buying decisions” [page 195]

Due to the importance of brand which influences buying decision, brand name ’s

factor is chosen for the research

2.6 Selection criteria

Models of customers’ behavior (organization customer) is shown that the

selection criteria is vary from model to model In order to give good selection,

customers should concern their own criteria to select supplier/manufacturer

According to Bharadwaj (2004), there are 04 criteria : quality, delivery, price

and service The important level of these criteria is depends on each customer

Table 2.6 : Important level of criteria

Important level of criteria for order decision Research

1 2 3 4

Lehman & O’ Shaughnessy (1974) Delivery Price Quality Service

Lehman & O’ Shaughnessy (1982) Quality Price Service Delivery

Note : from 1 to 4 (important level descending)

(Source : Bharadwaj (2004), Industrial Marketing Management p 318)

Therefore, the important criteria for making decision is : quality, price, delivery and service The important level depends on type of commodities, customers, buying situation… This research is also used these criteria in model research because this criteria is more popular and used a lot through previous researches

2.7 Proposed research method

Based on theories which was reviewed and studied above and after studying the

particular characteristics of this research study “Influencing factors to buying decision of cement products for housing construction in HCMC”, the model of

research study have developed and proposed as follows :

Figure 2.7: proposed research model

Notes

(2.1) See Henry Assael, Consumer Behavior and Marketing Action (Boston: Kent, 1987), ch.4

(2.2) William P Putsis Jr and Narasimhan Srinivasan, “Buying or Just Browsing? The Duration

of Purchase Deliberation”, Journal of Marketing Research (August 1994): 393-402

(2.3) Chem L Narayana and Rom J.Markin, “Consumer Behavior and Product Performance: An

alternative Conceptualization, “Journal of Marketing Research (October 1975): 1-6 See also

Wayne S DeSarbo and Kamel Jedidi, “The Spatial Representation of Heterogeneous

Consideration Sets”, “Marketing Science 14, no 3, pt.2 (1995): 326-42; Lee G Cooper and Akihiro Inoue, “Building Market Structures from Consumer Preferences,”Journal of Marketing

Research 33, no 3 (August 1996): 293-306

(2.4) Jagdish N Sheth, “An Investigation of Relationships among Evaluative Beliefs, Affect, Behavioral Intention, and Behavior, in John U Farley, John A Howard, and L Winston Ring

(eds.), Consumer Behavior: Theory and Application (Boston: Allyn & Bacon, 1974), pp 89-114

(2.5) Fishbein, “Attitudes and Prediction of Behavior”

(2.6) Raymond A Baeur, “Consumer Behavior as Risk Taking,” in Donald F Cox (ed.), Risk

Taking and Information Handling in Consumer Behavior (Boston: Division of Research, Harvard

Business School, 1967); James W Taylor, “The Role of Risk in Consumer Behavior”, Journal

of Marketing (April 1974): 54-60

(2.7) Robinson, P.J., Farics, C.W & Wind, Y (1967), Industrial Buying & Creative Marketing,

Boston: Allyn & Bacon, Inc

(2.8) Dempsey, W.A (1978), Vendor Selection and Buying Process, Industrial Marketing

Management, Vol.7, 257-267; Robinson, P.J., Farics, C.W & Wind, Y (1967)

CHAPTER 3 RESEARCH DESIGN

This chapter describes the detailed research process The research process has two stages: qualitative research and quantitative research

3.1 Research methodology

This research is carried out by qualitative research and quantitative research At first, the qualitative research is carried out to modify the initial model (if necessary), the quantitative research is followed in order to get the result

3.1.1 Qualitative research

Qualitative research is a kind of study in which information collected is qualitative In qualitative research, normally there are three methods: face-to-face discussion, group discussion and deductive method In this dissertation, the researcher chooses face-to-face discussion method, based on the discussion draft available This method is chosen because face-to-face discussion have advantage that the experienced people who are interviewed have the chance to talk about their all thoughts and understandings

The objective of qualitative research is to determine the main factors which influence the decision of buying products and also find out other facts in the initial model which did not mention so that the final model is modified for

research In the meanwhile, following to the result of the qualitative research, the questionnaire for the quantitative research is modified for research

The number of persons selected for interview in qualitative research is from 5-8 people The people selected for qualitative research are those retailer and small contractors who have much experience in cement products (refer to Appendix 1:

Discussion framework form)

3.1.2 Quantitative research

After the qualitative research, the quantitative research is carried out to quantify all influencing factors Based on the result of the qualitative research, the design

of questionnaire will be done The data are collected by survey as follows:

At first, the researcher directly interviews 8-10 people with the questionnaire to find out if it has any point causing unclarity or confusion to interviewees, if there

is, the questionnaire will be adjusted After that the researcher will continue conducting interviews until no confusion for interviewees is found The target group of people selected for interviews is also chosen by convenient method

The questionnaire, after being adjusted to match the research targets and customers’ possibility of responding, will be used for official interviews

Information gathered from all questionnaires will be cleaned Then this

information will be analyzed by programs Excel, SPSS version 16.0

3.2 The results of qualitative research

Qualitative research aims at recognizing some important factors influencing the decision of buying cement products for housing construction of individual retailers and contractors using the theoretical model from which it is adjusted to match the customer behavior and needs This is also the basic for the researcher

to set up the scale of measurements for factors in the qualitative research

Based on the results of qualitative research, there are some main factors influencing decision making in buying cement products as follows:

The above-mentioned factors are the main factors having great impact on the decision of buying cement products of customers As no adjustment has been made to the initially suggested model, it is also the official model of research

3.3 Quantitative research

3.3.1 Setting up, building and evaluating the scale of measurement

The scale of measurement used in this method is the Likert 05 points scale Likert scale will be used for quantitative variables

3.3.1.1 Scale of variable relative to willingness of buying

These variables will be measured by Likert 05 points scale (01 is Totally not Important, 02 is Not important, 03 is Moderate, 04 is Important, 05 is Very Important)

3.3.1.2 Scale of the other groups of variables

Likert 05 points scale (01 is Totally not Important, 02 is Not Important, 03 is Moderate, 04 is Important, 05 is Very Important) will be used to measure the other groups of variables as follows:

1 The group of variables relative to Brand name of product

2 The group of variables relative to Quality of product

3 The group of variables relative to Customer service

4 The group of variables relative to Price

5 The group of variables relative to Delivery Service

6 The group of variables relative to Capacity of Manufacturer

Table 3.1: Scale of the other groups of variables

CODE OF VARIABLES

The group of variables relative to quality of

product

QUAL1 4 Stable quality QUAL2 5 Product with different usage purposes QUAL3 6 High fines ratio

QUAL4 7 Fast setting time QUAL5 8 High quality bag

The group of variables relative to customer

services

SERV1 9 Customer consulting SERV2 10 Regular staff visit SERV3 11 Complaint solving quickly SERV4 12 Serving with good attitudes

The group of variables relative to price

PRI1 13 Reasonable price PRI2 14 Stable price PRI3 15 Flexible credit level PRI4 16 Flexible payment term

The group of variables relative to Delivery

services

DEL1 17 Delivery in time DEL2 18 Easy and simply procedure DEL3 19 Quick delivery after order DEL4 20 Available product

The group of variables relative to capacity of

manufacturer

CAP1 21.Big production capacity CAP2 22 Large distribution network CAP3 23 High quality control system

3.3.2 Evaluating the scale of measurement and filtering data gathered from questionnaire

3.3.2.1 Evaluating the scale of measurement

Scale of measurement will be evaluated by two methods: liability factor Cronbach’s Alpha and exploratory factor analysis Some requirements of a scale

3.3.2.2 Filtering data gathered from questionnaire

The data collected is filtered by 2 steps:

Firstly, the interviewer leaves out the questionnaires which interviewees didn’t provide enough information or didn’t fill out all information needed (preliminary filtering) If the interviewer finds out any unfulfilled parts, he can ask the interviewees to fill them to accomplish the questionnaires

Secondly, the researcher filters the data again by checking the questionnaires to sort out the people who did not have consideration when evaluating the influencing factors or did not provide detailed or relevant information The reason for this is if the interviewees do not really care about buying, they will provide incorrect information, which can not make the research results feasible

Thirdly, filtered and encoded data will be input and processed by Excel & SPSS 16.0 programs

3.3.3 Data analysis process

Data will be analyzed as follows:

Figure 3.2: Data analysis process

reliability

of Likert scale

Analysis of exploratory factor (EFA)

Paired Samples

T Test

Rejecting unsuitable variables

3.3.4 Size of sample

The number of delivered questionnaires is 200; the number of collected questionnaires is 175 (87.5%) after selecting, cleaning up all data, rejecting the unsuitable questionnaires Some questionnaires were rejected because some respondents did not provide enough or exact or unclear information due to lack

of careful consideration in terms of evaluating the factors influencing purchase decision

CHAPTER 4 OVERVIEW OF CEMENT MARKET IN VIETNAM

4.1 Overview of Vietnamese economy environment

Vietnam is considered one of the countries to overcome the difficult period and recovered quickly from the global financial crisis Gross domestic product (GDP)

in 2010 is estimated to increase 6.78% compared with 2009 GDP per capita is about 1,200 USD GDP growth speeds at relatively high levels and stable in recent years This is an opportunity to develop the cement industry in Vietnam

Foreign Direct Investment (FDI) in 2010 reached USD 18.6 billion In the field

of foreign investment capital in Vietnam this year, real estate investment is leading with a total capital of USD 6.8 billion This is also the good opportunity for Vietnamese cement market in the coming time

The population of country in 2010 estimated 86.93 million Of the total national population in 2010, urban population is 26.01 million, accounting for 29.9% of the total population, up 2.04% over the previous year; rural population is 60, 92 million people, accounting for 70.1%, up 0.63% Therefore, the demand of housing is rapidly increased in future and this is really a potential market for development of cement industry

The Urbanization speed in Vietnam also increased sharply with rate 3.75% per year As figure below, we can see the urban population is more than doubled within 20 years (1990 to 2010) It is also requested the demand of housing in big