Some marketing solutions to improve the competitiveness of confectionery products of hoang mai trading and production company limited

From this view, I have studied about marketing and I would like to raise thetopic : “ Some marketing solutions to improve the competitiveness ofconfectionery products of Hoang Mai Tradin

LIST OF ABBREVIATIONS

1 Hoang Mai Trading and Production Company Limited: Hoang Mai P&T Co.,LTD

LIST OF TABLES AND CHARTS

1 Diagram 1: The management system of Hoang Mai Trading

andProduction Company Limited………25

2 Table 1: The income statement of Hoang Mai Trading and Production Company Limited 2013-2015 ……… 30

3 Table 2: The rotatory of products of Hoang Mai P&T Co.,LDT…… 32

4 Table 3 : Financial situation of Hoang Mai P&T Co.,LDT………… 34

5 Table 4: Product structure of Hoang Mai P&T Co., LTD……….37

6 Table 5: Compare the price of competitor’s confectionery items…….41

7 Diagram 2: The distribution channel of Hoang Mai Trading and

Production Company Limited……… 43

8 Table 6: Budget allocation of promotion tool of Hoang Mai Trading and Production Company Limited………44

1 Rationale of the study.

After many years of economic reforms, Vietnam has strongly changed andmobilized to market mechanism under the management of the Government Withthe open economy, enterprises can self-control their business It is a goodopportunity for businessmen to control and develop their enterprises

Fair trade enables vendors and manufacturers to offer the best products to abroader array of customers and consumers At the same time, it brings aboutcompetition among business It is, therefore, vital for companies to improve theircompetitiveness in the race to earn their position in this open market In order toobtain the highest efficiency, companies need to consider their product’s quality,the reputation of business, and trade condition And companies have to findways to organize marketing activities effectively as well as improvecompetiveness of enterprises If they do not do marketing well, they will have alot of difficulties in their business activities, especially in the fierce competitionenvironment at present In this situation, Hoang Mai Trading and ProductionCompany Limited has found that marketing is a good solution to associate andcreate competitiveness for its company Marketing activities not only attractcustomers but also help company consume products better to improve theefficiency of company

From this view, I have studied about marketing and I would like to raise thetopic : “ Some marketing solutions to improve the competitiveness ofconfectionery products of Hoang Mai Trading and Production Company

2 Aims of the study.

The study aims at:

Basing on situation of marketing activities of Hoang Mai trading andproduction company limited, suggesting solutions to improve competitiveness ofthe company

3 Scope of the study.

As mentioned above, the thesis concentrates on the marketing solutions toimprove the competitiveness of the company It focuses on collecting andanalyzing the figures from accounting department of the firm within three years,from 2013 to 2015

4 Methodology.

To achieve research objectives, I use the desk review method to researchand analyze

5 Organization of the study.

The thesis includes the following contents:

Chapter 1: LITERATURE REVIEW

Chapter 2: THE STUDY

LIST OF FIGURES AND TABLES

TABLE OF CONTENTS

INTRODUCTION

1 Rationale of the study

2 Aims of the study

3 Scope of the study

4 Methodology

5 Organization of the study

CHAPTER 1: LITERATURE REVIEW

1.1 The basic definition and characteristics of marketing.

1.2 The major content of marketing activities in company.

1.3 Competition and the rationale of competition of the market

economy.

CHAPTER 2: THE STUDY

2.1 The development of company.

2.2 The operating outcome of company in recent years.

2.3 The real situation of marketing activities of company.

CHAPTER 3: RECOMMENDATIONS

3.1 The developing direction of company.

3.2 Solutions to improve competitiveness of company.

3.3 The supporting solutions.

DETAILED OUTLINE Chapter 1: LITERATURE REVIEW

1.1 The basic definition and characteristics of marketing

1.1.4 Researching and determining market needs

1.2 The major content of marketing activities in company

1.2.1 Choose target market and locate market1.2.2 Market segment

1.2.3 Choose target market

 Definition

 Market segment valuation

 Choose target market

 Marketing strategies

 The base of choosing marketing strategies

 Marketing implementation and examination

1.3 Competition and the rationale of competition in the market

1.3.1 Definition and the characteristics of competition.

1.3.2 The roles of competition in the market economy

 The roles of competition in service business

 The roles of competition to consumers

 The roles of competition in society economy

Chapter 2: THE STUDY

2.1 The development of company.

2.1.1 The formation history and development of company

2.1.2 Human resources and human resources training

2.1.3 The occupations of business registration and Field of business 2.2 The operating outcome of company in recent years.

2.2.1 The operating outcome

2.2.2 The situation of organising business products

2.2.3 The product circulation of company

2.2.4 Financial statement of company

2.3 The real situation of marketing activities of company.

2.3.1 Marketing strategy of company

2.3.2 Marketing solutions of company

2.3.2.2 Price policy

2.3.2.3 Distribution policy

2.3.2.4 Mixed Promotion policy

2.3.3 Market researching activity of company

Chapter 3: RECOMMENDATIONS

3.1 The developing direction of company.

3.1.1 Target market and marketing objectives

3.1.2 Competitive position of company in the market

3.2 Marketing solutions.

3.2.1 Competitive strategy of company

3.2.2 Product strategy for target market

3.2.3 Price policy

3.2.4 Distribution strategy

3.2.5 Mixed promotion strategy

3.3 The supporting solutions

3.3.1 Marketing organisation

3.3.2 The solutions of researching Marketing

CHAPTER 1: THE RATIONALE OF MARKETING IN BUSINESS

According to American Marketing Association (AMA): “Marketing is theactivity, set of institutions, and processes for creating, communicating,delivering, and exchanging offerings that have value for customers, clients,partners, and society at large”

Dr Philip Kotler defines marketing as “The science and art of exploring,creating, and delivering value to satisfy the needs of a target market at a profit.Marketing identifies unfulfilled needs and desires It defines, measures andquantifies the size of the identified market and the profit potential It pinpointswhich segments the company is capable of serving best and it designs andpromotes the appropriate products and services”

Another view from Heidi Cohen-President, Riverside Marketing Strategies,

he defines: “Marketing is the process of getting a product or service from acompany to its end customers from product development through to the final saleand post purchase support”

In general, Marketing should be understood not in the old sense of making a

working with market to implement exchanges on the aim of satisfying customerneeds and demands.

1.1.2 The characteristics of Marketing concept.

1.1.2.1 Customer-orientation.

All business activities should be directed to create and satisfy the customer.Emphasis on the needs and wants of consumers keeps the business on the righttrack All marketing decisions should be made on the basis of their impact on thecustomer Consumer becomes the guide of business

1.1.2.2 Marketing Research.

Under the marketing concept; knowledge and understanding of customer’sneeds, wants and desires are very vital Therefore, a regular and systematicmarketing research programme is required to keep abreast of the market Inaddition, innovation and creativity are necessary to match the products ofrequirements of customers Up-to-date and adequate knowledge must beavailable to answer the following questions: (1)What business are we really in?,(2)Who are our customers?, (3)What do the customers want?, (4)How should wedistribute our products?, (5)How can we communicate most effectively with ourcustomers?

1.1.2.4 Integrated Marketing.

Once the organisational and departmental goals are formulated, it becomesnecessary to harmonize the organisational goals with the goals of the individualsworking in the organisation The activities and operation of variousorganisational units should be properly coordinated to achieve the definedobjectives The marketing department should develop the marketing mix which

is most appropriate for accomplishing the desired goals through the satisfaction

of customers

1.1.2.5 Customer Satisfaction.

The aim should be to maximize profit over the long run through thesatisfaction of customer wants

1.1.3 The functions of Marketing.

The ultimate aim of marketing is exchanging goods and services fromproducers to consumers in a way that maximizes the satisfaction of customer’sneeds Marketing functions start from identifying the consumer needs and endwith satisfying the consumer needs The universal functions of marketinginvolve buying, selling, transporting, storing, standardizing and grading,financing, risk taking and securing marketing information However, modernmarketing has some other functions such as gathering the market informationand analyzing that information The assistance in product designing anddevelopment also comes under the marketing functions The marketing functionshave been discussed briefly: Market information, market planning, exchangefunctions, product designing and development, physical distribution,standardization and grading, financing, risk taking, packaging, labeling and

1.1.4 Researching and determining market needs.

Needs, wants and demands.

Needs: “The most basic concept underlying marketing is that of human

needs Human needs are states of felt deprivation They include basic physicalneeds for food, clothing, warmth and safety; social needs for belonging andaffection; and individual needs for knowledge and self-expression Marketers didnot invent these needs; they are a basic part of the human make-up”- PhilipKotler et al, Marketing

When a need is not satisfied, a person looks for an object that will satisfy it

or tries to reduce the need

Wants : “Wants are the form human needs take as they are shaped by

culture and individual personality Wants are shaped by one’s society and aredescribed in terms of objects that will satisfy needs As a society evolves, thewants of its members expand As people are exposed to more objects that arousetheir interest and desire, producers try to provide more want-satisfying productsand services”- Marketing, An Introduction by Philip Kotler and Gary Armstrong

Demands: People have narrow, basic needs, but almost unlimited wants.

However, they also have limited resources Thus, they want to choose productsthat provide the most satisfaction for their money When backed by an ability topay – that is, buying power – wants become demands Consumers view products

as bundles of benefits and choose products that give them the best bundle fortheir money Given their wants and resources, people demand products with thebenefits that add up to the most satisfaction

The marketing offering: Products, services and experiences

Companies address needs by putting forth a value proposition, a set ofbenefits that they promise to consumers to satisfy their needs The valueproposition is fulfilled through a marketing offer– some combination ofproducts, services, information, or experiences offered to a market to satisfy aneed or want Marketing offers are not limited to physical products

Value, Expenditure and Satisfaction.

Consumers usually face a broad array of products and services that mightsatisfy a given need How do they choose among these many products?Consumers make buying choices based on their perceptions of the value thatvarious products and services deliver The guiding concept is customer value

“Customer value is the difference between the values the customer gains fromowning and using a product and the costs of obtaining the product”- PhilipKotler, Principles of Marketing

Exchange, Transactions and relationships.

Marketing occurs when people decide to satisfy needs and wants throughexchange According to Philip Kotler: “Exchange is the act of obtaining adesired object from someone by offering something in return” Exchange is thecore concept of marketing For an exchange to take place, several conditionsmust be satisfied Marketing consists of actions taken to obtain a desiredresponse from a target audience towards some product, service, idea or otherobject Transaction marketing is part of the larger idea of relationship marketing.The concepts of exchange and relationships lead to the concept of a market

Markets

Modern economies operate on the principle of division of labour, whereeach person specialises in producing something, receives payment, and buysneeded things with this money Thus, modern economies abound in markets.Producers go to resource markets (raw material markets, labour markets, moneymarkets), buy resources, turn them into goods and services, and sell them tointermediaries, who sell them to consumers The consumers sell their labour, forwhich they receive income to pay for the goods and services they buy Thegovernment is another market that plays several roles It buys goods fromresource, producer and intermediary markets, it pays them, it taxes these markets(including consumer markets)and it returns needed public services Thus, eachnation’s economy and the whole world economy consist of complex interactingsets of markets that are linked through exchange processes.

Marketing and Marketer.

Considering market brings us full circle to the concept of marketing.Exchange processes involve work Sellers must search for buyers, identify theirneeds, design good products and services, promote them, and store and deliverthem Activities such as product development, research, communication,distribution, pricing and service are core marketing activities Companypurchasing agents do marketing when they track down sellers and bargain forgood terms A sellers’ market is one in which sellers have more power andbuyers must be the more active ‘marketers’ In a buyers’ market, buyers havemore power and sellers have to be more active ‘marketers’ In the usualsituation, marketing involves serving a market of end users in the face ofcompetitors The company and the competitors send their respective products

and messages directly to consumers or through marketing intermediaries to theend users

1.2 The major content of marketing activities in company

1.2.1 Choose target market and locate market

Companies know that they can not satisfy all consumers in a given market

-at least, not all consumers in the same way There are too many kinds ofconsumer with too many kinds of need, and some companies are in a betterposition than others to serve some groups of customers better Consequently,companies use market segmentation to divide the total market They then choosemarket segment and design strategies for profitably serving chosen segments.This process involves market segmentation, targeting and positioning From thecomplexity of humans, it follows that there are many ways in which marketssegment, and finding a new way of segmenting markets or a new segment can bethe break through that creates a market success Market targeting involvesevaluating each market segment’s attractiveness and selecting one or moresegments to enter

1.2.2 Market segmentation

Definition: “Market segmentation consists of taking the total heterogeneous

markets for a product and dividing it into several sub-markets or segments, each

of which tends to be homogeneous in full significant aspects”- WilliamJ.Stanton, Principles of Management and Administration

Some requirements of market segmentation.

Measurability: Market segmentation has to ensure to measure scale,

purchasing power and characteristics of customers each segment

Large-scale: These segments have to be enough large and have ability to

make profit Market segment should be the largest and the most crowded,deserving to carry out a separate marketing program

Distinguishability: These market segments differ from definition and satisfy

differently with Marketing mix elements and various marketing programs

Feasibility: Marketing activities have to contact with customers and have

enough human resources to develop, implement Marketing programs effectivelyand attractablely, satisfy customer’s needs and wants in that segment

The basis of market segmentation

Geographic segmentation: “ Geographic segmentation involves the

subdivision of a market into distinct geographical units such as national, state,regional, country, city or neighborhood boundaries”- Writing a convincingbusiness plan by Arthur DeThomas,Ph.D; and Stephanie Derammelaere, M.B.A

A company may decide to operate in one or a few geographical areas, or tooperate in all areas but pay attention to geographical differences in needs andwants

Demographic segmentation: Demographic segmentation consists of

dividing the market into groups based on variables such as age, gender, sexualorientation, family size, family life cycle, income, occupation, education,religion, ethnic community and nationality (Armstrong and PhilipKotler,2005:187)

Demographic factors are the most popular bases for segmenting customergroups One reason is that consumer needs, wants and usage rates often varyclosely with demographic variables

Life-cycle segmentation (Age)- Offering products or marketing approaches

that recognize the consumer’s changing needs at different stages of their life.Consumer needs and wants change with age Some companies use age and life-cycle segmentation, offering different products or using different marketingapproaches for different age and life-cycle groups

Ethnic segmentation: The multi-ethnic communities define market

segments for all manner of goods The communities also nurture businesses thatappear beyond their own ethnic boundaries

Gender segmentation: is usual in clothing, hair dressing, cosmetics and

magazines Recently, marketers have noticed other opportunities for gendersegmentation

Income segmentation- Dividing a market into different income groups

Income segmentation is often used for products and services such as cars,boats, clothing, cosmetics and travel Many companies target affluent consumerswith luxury goods and convenience services

Geodemographics- The study of the relationship between geographic

allocation and demographics

Geodemographic segmentation is based on two simple principles:

People who live in the same neighborhood are more likely to have similarcharacteristics than are two people chosen at random

Neighborhoods can be categorized in terms of the characteristics of thepopulation which they contain Any two neighborhoods can be placed in thesame category They contain similar types of people, even though they arewidely separated

Psychographic segmentation: Psychographic segmentation divides buyers

into groups based on social class, lifestyle or personality characteristics

Psychographic segmentation is one which uses people’s lifestyle, theiractivities, interests as well as opinions to define a market segment

Some factors which help divide a population based on psychographicsegmentation: Lifestyle, activities interests and opinions, values attitudes andlifestyle, social class, personality,…Overall, these factors are intangible in natureand need in depth market research to determine which lifestyle or social class totarget

Choose target market

Definition: “A target market is the market segment on which an

organisation focuses its marketing plan and to wards which it directs itsmarketing efforts”- Irma Mckinlay, Maria O’Connor, Sara Ross, FCS MarketingL2

Market segment valuation: The scale and growth of market segment:

Choosing big market segment or small market segment refers to ability andhuman resources of enterprises Enterprise needs to collect and analyze thesefigures: Sales, profit and how profit change

Choose target market: There are 5 ways of selecting target market:

Concentrating on market segment, specializing selection, specializing according

to product, specializing according to market, covering total market

Marketing strategies:

Definition: “An organization's strategy that combines all of its marketing

goals into one comprehensive plan A good marketing strategy should be drawn

maximum profit potential and sustain the business The marketing strategy is thefoundation of a marketing plan”- in the view of Christina Motley.

Developing a marketing strategy is vital for any business Without one, theefforts to attract customers are likely to be haphazard and inefficient The focus

of the strategy should be making sure that the products and services of companymeet customer needs and developing long-term and profitable relationships withthose customers To achieve this, company will need to create a flexible strategythat can respond to changes in customer perceptions and demand It may alsohelp company identify whole new markets that you can successfully target

The base of choosing marketing strategy: One of the key elements of a

successful marketing strategy is the acknowledgement that company’s existingand potential customers will fall into particular groups or segments,

characterised by their "needs’ Your strategy must take account of how your

business' strengths and weaknesses will affect your marketing With anunderstanding of your business' internal strengths and weaknesses and theexternal opportunities and threats, you can develop a strategy that plays to yourown strengths and matches them to the emerging opportunities You can alsoidentify your weaknesses and try to minimise them The next step is to draw up adetailed marketing plan that sets out the specific actions to put that strategy intopractice

Marketing implementation and examination.

Organizing implementing marketing is the process of transforming themarketing strategy and program of marketing activities in order to actuallyachieve the marketing objectives set out in an effective way While the analysis

marketing activities, the implementation aimed to find answers: who, where,when, and how to turn strategic ideas become reality.

The mission of the marketing department is to plan, implement and testmarketing A marketing plan is designed perfectly whether it is, it may still arisemany problems to solve in the implementation process, so the marketingdepartment must regularly monitor and test marketing activities When thesystems examine if marketing works well, it will ensure in particular formarketing activities and business activities of enterprises in general achievegoals with greater efficiency

1.3 Competition and the rationale of the market economy.

1.3.1 Definition and the characteristics of competition.

Definition: “Rivalry in which every seller tries to get what other sellers are

seeking at the same time: sales, profit, and market share by offering the bestpracticable combination of price, quality, and service Where the marketinformation flows freely, competition plays a regulatory function in balancingdemand and supply”- German Wilches

Characteristics of competition:

Scarcity as a condition of competition: Wherever there are commonlydesired goods and services, there is competition In fact, economics starts withits fundamental proposition that while human wants are unlimited the resourcesthat can satisfy these wants are strictly limited Hence people compete for thepossession of limited resources: Competition is continuous, competition is acause of social change, competition may be personal or impersonal, competition

is always governed by norms

The roles of competition in service business:

Competition is a majeure thing in the market economy Entrepreneurs andbusinesses have to accept competition when they join in market Competitioncan be considered a fierce race that businesses can not parry and find the bestways to take the lead Hence, competition forces businessmen to find the ways toimprove service quality, best satisfy the needs and wants of customers as wellmarket Because of high competitive pressure, businesses run efficiently

The roles of competition to consumers.

Thanks to competition, the consumers receive more favourable anddiversified service quality The service quality is enhanced while the expensereduces Competition also protects consumer’s own interests

The roles of competition in social economy.

For the social economy, competition plays an important role:

Competition is the motivation of developing economy, improving thequality of society services Competition creates the innovation, brings strongergrowth, helps to eliminate unreasonable monopoly and inequality on business.Besides, competition also brings disadvantages Market mechanism forcesbusinesses to participate to compete and exist This requires Government’smanagement to make sure the enterprises can free compete effectively

CHAPTER 2: ANALYZING THE MARKETING ACTIVITIES OF HOANG MAI TRADING AND PRODUCTION COMPANY LIMITED

2.1 The development of company.

2.1.1 The formation history and development of company

Hoang Mai Trading and Production Company Limited was found inOctober 2001 by the certificate of business registration No 0102003620 byDepartment of Planning and Investment in Hanoi, originally located at 48 HangTre, Hoan Kiem District, Ha Noi, Viet Nam In October 2005, head office weremoved to 40 Tran Nhat Duat, Hoan Kiem District, Ha Noi In April 2011, thecompany moved to Office 9th Floor, HCMCC Tower office building, 249AThuy Khue Street, Tay Ho District, Hanoi The company exclusively importsand distributes high quality confectionery products (cookies, biscuits, cake andcandy) in Viet Nam Business products are distributing nationwide by systems ofregional distributors and supermarkets (Metro, Big C, Saigon corp, Intimex,Hapro) and retailers In 2011, the company just imported Apollo productswhich made in Malaysia After 1 year, the company developed 15 ranges ofproduct, for example Apollo, Rinda Gula candy and KokocChocolate fromMalaysia, or Crow-pie from Korea, Nissin Cookies from Indonesia From 2003

to 2004, the company added 21 ranges, it made the total of 36 ranges of product

from 8 producers By 2005, the company increased to 60 ranges of product Thecompany enlarged business over Europe, Midle East, and it were exclusive salesagent for Montresor - Belgium, Euro cake - UAE, Chocolate Socado – Italyin

2006 From 2007 to 2015, the company developed other ranges of products fromother industries such as Nabisco, Montresor, Dofreeze, Rinda Food

2.1.2 Human resources and human resources training.

The management committee of the company includes 1 general manager, 1deputy managing director and 1 chief accountant

Some departments of the company such as The department of chiefaccountant, The sales department, The department of import and export, Themarketing department, The department of administrative and human resources,Warehouse: Dien warehouse, Trieu Khuc warehouse, Ngoc Lam warehouse

Functions and mission of each department:

(1) General manager: Nguyen Thi Tuyet Mai

General manager directly operates and manages the entire businessactivities, takes responsibility of the company’s outcome, represents the entireinterest of all staff and employees in the company, assigns tasks to deputymanaging director and also takes responsibility for the tasks assigned to theDeputy Managing Director

(2)The deputy managing director: Nguyen Thi Huong

The deputy managing director counsels and supports General Manager, hasresponsibility for assigned missions On behalf of General Manager to manageentire business activities

(3) The department of human resources