Local brands of Phutho province from the perspective of domestic investors

The research was conducted to analyze the local brands of Phu Tho province from the perspective of domestic investors. Through the research framework of local brands equity‟s six elements and data collected from the survey of 425 domestic investors in Phu Tho province. The results show that local brands of Phu Tho province are highly valued by domestic investors. However, there are still aspects that have not been appreciated and that need to be addressed. Based on the results of the study, the researchers proposed to increase the value of local brands, helping to retain existing investors and attracting potential investors to Phu Tho province.

LOCAL BRANDS OF PHUTHO PROVINCE FROM THE

PERSPECTIVE OF DOMESTIC INVESTORS

PhD Pham Thi Thu Huong

huongdhhv84@gmail.com Faculty of Economics and Business Administration - Hung Vuong University

MBA Pham Thi Thu Huong

phamthuhuong266@gmail.com Faculty of Economics and Business Administration - Hung Vuong University

Dr Pham Thi Nga

phamngaktct@gmail.com University of Economics and Business Administration - Thai Nguyen University

PhD Luu The Vinh

luuthevinh227@gmail.com Faculty of Political Theory - Hung Vuong University

Dr Dinh Hong Linh

dhlinh23@gmail.com University of Economics and Business Administration - Thai Nguyen University

Abtract

The research was conducted to analyze the local brands of Phu Tho province from the perspective of domestic investors Through the research framework of local brands equity‟s six elements and data collected from the survey of 425 domestic investors in Phu Tho province The results show that local brands of Phu Tho province are highly valued by domestic investors However, there are still aspects that have not been appreciated and that need to be addressed Based on the results of the study, the researchers proposed to increase the value of local brands, helping to retain existing investors and attracting potential investors to Phu Tho province

Key words: local brands, investors, domestic investors, Phu Tho province

1 Introduction

Today, local brands have become an indispensable part of the global competition for attracting investment for local economic development Local brands bring many benefits, not only to local and local public, but to all stakeholders such as investors, residents and tourists Therefore, local governments and organizations need to be aware of the importance of building local brands, exploiting their strengths, and having appropriate development strategies to enhance their local position in the eyes of the target customers

At present, in the structure of Vietnam's investment capital, domestic capital plays

a decisive role As a mountainous midland province in the north, Phu Tho has a great potential for economic development In the period from 2012 to 2016, domestic capital accounts for a high propotion (95.13%), foreign investment accounts for a relatively low proportion of total provincial investment (8.87%) This structure represents the advantage

of domestic investment

In recent years, investment capital in general and domestic investment capital in particular in Phu Tho province has been contributing to the socio-economic development

of the locality, actively participating in economic restructuring, improving the living standards of the population However, investment capital in the province in the past years

is below the potential and strength of the province Phu Tho province is in the period of industrialization - modernization, the demand for capital for socio-economic development

is very large

The plan to attract the total investment capital of the whole society in the

2016-2020 period is over 95 trillion VND In order to reach the target by 2016-2020, Phu Tho is basically an industrial province, the attraction of domestic investment capital is a matter of survival Therefore, the research on the local brands of the province from the perspective

of domestic investors, from which solutions to increase the value of local brands, contributes to retain the current investors and to attract potential investors for Phu Tho province is really necessary

2 Method

The study used three main methods, including:

(1) Data collection method: Use the research method at the desk to collect secondary data Use qualitative research method with in-depth interviewing techniques and quantitative research methods with survey techniques through questionnaires to collect primary data

The respondents are domestic investors, who are investing in Phu Tho province Sample size is 425 with the form of direct vote The research uses a non-probability sampling method with a convenient sampling form to proactively select the most accessible and well-informed survey respondents

In the research, the survey was inherited and developed from Jacobsen's local brands equity scale (2012) Using the Likert scale to collect domestic investors' perceptions

of local brands equity in Phu Tho province Level 5 is strongly agreed, level 4 is agreed, level 3 is neutral, level 2 is not agree and level 1 is very disagreeable

(2) Data processing method: Data collected, encoded, entered into Excel software and calculated necessary indicators such as percentage below the level of agreement, % neutral, % from the level of agreement and above and the mean

(3) Data analysis method: The study used a descriptive and comparative statistical method to analyze the necessary indicators to clarify the local brands of Phu Tho province from perception and evaluation of domestic investors

3 Results

Domestic investors‘ evaluations on the local brands of Phu Tho province about each element of local brand equity show more clearly about the current local brands of the province

Table 1 Domestic investors’ evaluation on the local brands of Phu Tho province

Observed variables

% below the level of agreement

% neutral

% from the level of agreement

and above

Mean

Local brands’ personality

Get to know the local brand

The first potential investment location to be

thought of

Feeling’s Quality

Have good experience in public

administration‘s services

Local authorities have professional working

methods

Impression of local brands

Enough resources to support the investment

and business

Belief in local brands

Commitment to government service is

reliable

Communication with businesses is always

open and honest

Observed variables

% below the level of agreement

% neutral

% from the level of agreement

and above

Mean

Local brands’ image

Have positive feeling and evaluation when

referring to Phu Tho

The investment in Phu Tho is associated with

the convenience

Local people are friendly and respect the

community

* Local brands’ personality

According to statistics from the observation variables measure the local brand personality of Phu Tho province, observation variables were rated with a high score of 4.14 to 4.29 on average Of these, 93.88% of businesses rated at the agreed level (level 4) and strongly agreed level (level 5) suggesting that Phu Tho was a suitable investment location for their businesses In addition, Phu Tho was highly appreciated by investors about the level of attractiveness for enterprises‘ business activities (92.23% agreed and strongly agreed) 87,29% of surveyed enterprises agree that Phu Tho is a good investment destination As such, the province needs to strengthen the attractiveness factors to become

a really good investment destination in order to attract more investors

Phu Tho is the gateway of the northwestern and midland markets with more than 20% of the population of the country Phu Tho is a densely populated province (by 2017 the province‘s average population is 1,392,000), of which, 759.8 thousand people labors aged 15 and over working in the economic sectors, the percentage of trained labors is 60.5%, of which 26.7% of trained labors are working in the economic sectors (Phu Tho province‘s Statistical Office, 2017) This is both a potential market and a factor to create favorable conditions for investors to invest in Phu Tho province Moreover, Phu Tho province‘s geographical location creates favorable conditions and great potential for production and trade with other regions in the country and internationally

* Get to know the local brand

Data related to local brand awareness showed that the mean value of observed variables was lowest at 3.47 and highest at 4.03 In particular, Phu Tho was not highly appreciated in the observation variable that Phu Tho is well-known in investment and business activities (average score was 3.47 and 16.24% was below the agreed level; 34.82% neutral), the reason is that in Phu Tho province, there are not strong investors in capital and technology, strong and influential brands in key areas of the province; moreover, local promotion activities have not been implemented regularly, synchronously and not effectively to attract investors in these areas However, Phu Tho was highly

appreciated by investors (83.53% agreed and strongly agreed), 71.53% said that Phu Tho is the first potential investment place they think of

The result of this evaluation is is that over the years, the provincial leaders are very interested in the business community and investors in the province Accordingly, the province has focused on promoting business support, thoroughly grasp all departments and sectors should implement well solutions to improve the business environment, support the development of enterprises in the spirit of Resolution No 19 -2016/NQ-CP dated 28 April

2016 and Resolution No 35/NQ-CP dated 16 May 2016 of the Government to Phu Tho becomes a new destination of domestic and foreign investors Apart from preferential policies of the state, the province also introduced many appropriate mechanisms and policies to support the development of enterprises through the issuance of documents relating to investment incentives for enterprises investing in the province, specifically: Decision No 04/2012/QD-UBND on investment support for investment projects in Phu Tho province, which stipulates investment support for investment projects in the province such as land policy, infrastructure policy and cost of ground leveling, providing services related to electricity and water to the fence of industrial zones and clusters, creating favorable conditions for enterprises to promote trade…; Decision No 25/2012/QD-UBND regulating support for small and medium industrial enterprises to invest in modernizing and modernizing technology in priority areas of development in Phu Tho province; Resolution No.15/2014/NQ-HDND stipulates special support policies to encourage enterprises to invest

in agriculture a rural areas in Phu Tho province in the period 2015-2020 At the same time, the province directs the branches and local administrations at all levels to advise on measures

to remove difficulties and obstacles in site clearance, shorten the time for settlement of investment procedures, early table hand over clean premises for business; to create all conditions on electricity, water and infrastructure for production; encourage businesses to invest in expansion of production and business in line with the provincial master plan In addition, the province also supports enterprises seek investment location; to support and create conditions for enterprises to promote investment and trade promotion

* Feeling’s Quality

The evaluation data on feeling‘s quality of investors in the local brands of Phu Tho's province is above average In particular, the experience of public administrative services of enterprises has not been highly appreciated, although the average score is 3.42>

3 points (higher than the agreed rate) but the rate below the agreed level is 6, 82% and the rate from the minimum level of consent is lowest among all observed variables (48.71%)

In contrast, investors highly appreciated the stability of service quality, the average score is 4.29 and 88.23% of enterprises rated this criterion at the agreed level or higher Although the service quality is quite stable, it still does not meet the demand of enterprises At the same time, there are still 4.47% of enterprises assess the local government lacking in the professional working methods

Over the past years, the Party and authorities of Phu Tho province have had many solutions in the reform of administrative procedures, the province has issued many legal documents to create the legal basis and the necessary conditions for the implementation of

reforming administrative procedures Specifically, some documents such as: Scheme No

4635 / DA-UBND dated 16/12/2011 on orientation to raise the provincial competitiveness index of Phu Tho province in 2011-2015 period; Decision No 14/2014/QD-UBND dated November 10, 2014 promulgating the regulation on implementation of the one-stop-shop mechanism in solving some administrative procedures for investment projects in the province; Plan No 1199/KH-UBND dated April 9, 2012, Plan No 803/KH-UBND dated 18/03/2013 and plan No 5592/KH-UBND dated 26/12/2014 of the Provincial People's Committee on implementing the state administrative reform of Phu Tho province in 2015, Plan no 5491/KH-UBND dated 31/12/2015 of the Provincial People's Committee on state administrative reform of Phu Tho province in 2016-2020 period Accordingly, the departments and sectors, the People's Committee of districts and urban areas have used the one-stop electronic gateway intergrated with online public service portal of Phu Tho province from October, 20, 2016 Administrative procedures are applied the electronic one-stop software in receiving and solving procedures at level 2

Although the province has paid much attention to the reform of administrative procedures, the implementation of administrative procedures under the one-stop-shop mechanism has been deployed However, there is no consistent among and sectors, coordination between levels and sectors is not synchronous At the same time, the service‘s quality at the one-door department of the departments is not really open to meet the needs

of investors In addition, the reform of administrative procedures is the common direction

of all localities throughout the country, in the trend of reform, Phu Tho province has not kept up with many other localities Therefore, this field is not the strength of the province

in the eyes of investors

The results are also consistent with provincial indicators such as the performance and provincial public administration indicators, Public Administraion reform (PAR) index

of Phu Tho province

Chart 1 Evaluation’s results on PAPI, PAR INDEX of Phu Tho province in the

period of 2013 - 2016

(Source: CECODS, 2013 - 2016; Interior Ministry, 2013 - 2016)

35

25

4

7

11

21

0

5

10

15

20

25

30

35

40

PAPI PAR INDEX

In the period of 2013 - 2016, the local authorities in Phu Tho province have made great determination and efforts to improve the quality of public administrative service delivery and enhance the provincial competitiveness As a result, the effectiveness of state management and policy‘s implementation and public service‘s delivery of the authorities

at all levels of Phu Tho province is also highly appreciated by the people (shown by the

results of people and enterprises on administration reform‘s activities of Phu Tho

indicators related to public administration services and local government of Phu Tho province are highly appreciated, however, these results have not kept up with other provinces and cities in the country

The assessment on the professionalism of local government is related to the index in dynamism and pioneering of provincial leaders

Table 2 Composition indicators of the dynamism index of the Phu Tho provincial

government in the period of 2013 – 2016

Provincial People's Committee is flexible in the legal

framework to create a favorable business environment

for private enterprises

Provincial People's Committee is very active and

Perceptions of the business on the attitude of the

There are good initiatives at provincial level but not

Provincial leaders have policies and policies that are

The reaction of the province to the unknown in the

central policy/document: "delay implementation and

seek guidance" and "do nothing"

Index of dynamism and pioneering of provincial leaders 3,93 3,9 4,63 4,65 4,28

(Source: VCCI Vietnam, 2013 - 2016)

In recent years, the leaders of Phu Tho province have been interested in organizing dialogue meetings with the business community at home and abroad But the number of enterprises increased over time as well as difficulties and problems have arisen so many such contacts have not satisfied the needs of enterprises Mechanisms and policies promulgated by province are proposed by the specialized management agencies based on the guiding and guiding framework of the central government So if there is no flexibility and professionalism in the administration and handling, it will cause difficulties for the business

Although the province has promoted the development of the private sector in the past time, the recognition of a part of civil servants on the role of the private sector is not objective, It is not commensurate with the role of this sector in development The results show that in the period of 2013 - 2016, the assessment on the attitude of the provincial government to the private sector is only 37.63% of businesses think positively Although there are 60.51% of businesses agree that "Provincial People's Committee is very flexible

in the legal framework to create a favorable business environment for private enterprises" but 75.68% agreed with the statement "There are good initiatives at the provincial level but not well implemented in the departments and sectors" and 53.71% agree with the statement

"Provincial leaders have policies and policies that are not properly implemented at the district level" This comes from the quality of civil servants and leaders in the departments and sectors of the province for the implementing tasks related to enterprises is weak; the skills of some civil servants are limited; they don‘t know the legal regulations that lead to guiding, handling and advising the leaders to remove difficulties and obstacles for enterprises still have many limitations and cause difficulties for them In the coming time, the provincial government should pay special attention to this human resource

* Impression of local brands

Investors' evaluation statistics also show that the geographic location of Phu Tho province is highly appreciated by investors, 90.82% of surveyed enterprises agreed and strongly agreed on Phu Tho with the favorable geographic location At the same time, the infrastructure and natural resources supporting the province's investment and business activities were also highly appreciated by the investors with the average score of 4,17 and 4,14

This can be explained by an analysis on the characteristics of: geographic location, natural resources and infrastructure of the province

Located at the confluence of the rivers, the northwestern gate of Hanoi capital, and

on the economic corridor of Kunming - Hanoi - Hai Phong, Phu Tho has important roadways such as Hanoi - Viet Tri - Lao Cai Highway; Ho Chi Minh Road, Routes 32A, 32C and Route 70; Hanoi - Lao Cai railway; waterway in the Red river connects with delta provinces, Northeastern and Northwest provinces… This is an ideal location for investors

In addition, Phu Tho has abundant natural resources, with large land area, suitable for planting material trees for processing industries The province has great potential for trees of paper material, materials for agro-forestry products and some high-value mineral resources such as kaolin, limestone, mineral water to develop the mining and mineral processing industries, cement, building materials, paper, ceramics The province also has rich tourist resources, with many historical, cultural and artistic monuments classified as historic relics Hung Temple, Ao Chau pond and the special cultural values of the ancestors Many folk and singing ―xoan create the unique features for Phu Tho, which is the potential for attracting investment and developing the province‘s tourism

In term of infrastructure, over the years, the province has paid special attention to the construction and development of infrastructure Accordingly, province‘s infrastructure

has made breakthrough developments, especially the system of foreign traffic At present, there are 7 industrial zones and nearly 26 industrial clusters in the province Industrial parks are connected with up and down buttons the Hanoi-Lao Cai Highway and the Ho Chi Minh Road In that, basically completed the infrastructure of Thuy Van industrial zone and some industrial clusters The infrastructures of urban areas, agriculture, rural areas and information communication have been strengthened The buildings belonging

to the historical relics of Hung Temple, Hung Vuong Square, Van Lang Park are in the stage of completion In addition, the province is actively improving and raising the criteria

on urban type 1 of Viet Tri city; to build Phu Tho town into a city These infrastructures have contributed significantly to attracting investors to the province

* Belief in local brands

Evaluation data on local brand beliefs of investors for Phu Tho province shows that 1.65% of businesses think that Phu Tho does not ―provide public services such as commitments‖ The average value of the observation variable of ―the local communication with the business is always open and honest‖ to 3.76 points; of which, 0.71% was below the agreed level, 35.06% neutral and 64.23% from the agreed level upwards The result

is that over time, local authorities often hold dialogues, process and remove difficulties for businesses, thereby create confidence for businesses (90.35% of enterprises believe in local activities)

Determining trust is an important factor in retaining old customers and attracting new customers Over the past years, local authorities in Phu Tho have made efforts to create trust for investors by transparency, friendliness, honest and creativeness Dialogue activities with businesses was also concerned by the province with a fierce takeover from the province to the province‘s localities Provincial leaders and departments, branches and localities were involved in dialogue activities, thereby promptly removed difficulties and properly handling many opinions and proposals of the business community At the same time, the province has implemented the hot line at all agencies and units in the province to receive comments, reflects and recommendations of organizations, individuals and enterprises on the services‘ moral and attitudes of civil servants and officials in the process of solving administrative procedures The provincial leaders have renewed their thinking, renewed the leadership style, directed and organized the work in the spirit of deep and effective However, dialogue with businesses has not been done regularly It is still difficult for enterprises actively contact with provincial leaders, from there, can‘t solve the shortcomings in terms of mechanisms and policies which cause difficulties to enterprises when carrying out projects in the province This negatively affects the local image, especially the local government in the eyes of investors, causing loss of confidence for current investors in the investment process and new investors when learning about the investment environment of the province In addition, the provincial leaders have not yet created a forum, a reliable and effective information channel for investors and enterprises to reflect their difficulties, obstacles and aspirations when investing in the province

Together with dialogue activities, the province also organizes investment promotion conferences to promote potentials, advantages, incentives and mechanisms, and create forums for organizations, domestic and foreign investors to meet, dialogue, exchange experiences, establish cooperative relationship for socio-economic development The provincial government has also made a commitment to investors With the motto of respecting partners, Phu Tho province always welcomes domestic and foreign investors, commits to a transparent investment environment, always encourages and creates favorable conditions in terms of mechanism, policies and procedures for investors to seek opportunities and cooperation in the province At the same time, local authorities are also committed to accompanying investors, and will welcome investors as welcoming relatives, see their success as their own success Though it, the message conveyed: Investing in Phu Tho is the right choice, looking forward to the future and having the foundation to ensure success Accordingly, the province has actively supported and assisted enterprises to enjoy the preferential mechanisms and policies of the State and the province This will be a premise for businesses to invest, to expand their production and to stabilize their development, create high production value, create jobs and income for employees, contribute many budgets for the state and participate in social charity activities, contribute

to the development of the province

* Local brands’ image

Statistics related to Phu Tho's local brand image show that Phu Tho's brand image is highly appreciated by investors Evaluation on the brand image of the province, the image

of the local people is evaluated with the highest average score of 4.5 points with 92.70% from the level of agreement upward; followed by a safe and stable investment environment with average mean at 4.33 points, 86.12% agreed and strongly agreed 88,94% of businesses feel positively when referring to Phu Tho and 72,70% of businesses think ―Phu Tho is a symbol of positive values‖

The above results are also consistent with the result of Phu Tho Provincial Competitiveness Index Determining PCI enhancement is one of the solutions needed to attract investment, creating a premise for a high-growth and sustainable economy Over the past years, Phu Tho province has made great efforts in building an open and transparent investment environment, helping businesses to secure investment, production and business The province has maintained its political stability, social order and safety, ensuring national defense and security, building a strong political system, active prevention of natural disasters, strengthening management of natural resources and protecting the environment so that investors can rest assured their production and business activities in the province All levels and all sectors of the government have focused on reforming administrative procedures, efforts to develop a system of solutions and mechanisms to encourage the development of economic sectors, in which interest and facilitate the development of the private sector As a result, the business environment of the province has improved markedly