However, there is no work that fullysynthesizes the definition of staple goods and clarifies the theory of the retail system of enterprises associated with specific characteristics of th
Trang 11 Rationale of the Study
Currently, rural areas account for a large proportion of Vietnam, causingmajor impact on both economy and environment Meanwhile, the majority ofVietnamese enterprises have limited potential or do not pay properly attention toinvesting in the retail system of staple goods in rural area in Red River Delta
Although there are certain restrictions on the retail system, in general,retailing in rural areas is still developing quite vibrantly, indicating the potentialfor development is not inferior to urban areas Therefore, some Vietnameseretail businesses began to find growth motivation from the retail system ofstaple goods in rural areas of the Red River Delta
The changeable business environment also significantly affected the retailsystem of staple goods of our enterprises in the rural area in Red River Delta Thischange in environment brings great opportunities and challenges for Vietnameseenterprises to expand to rural areas
Besides that, academically, in recent years, although there have been manydomestic and foreign projects such as books, scientific researches, doctoraldissertations, scientific papers on theoretical research about retail developmenttrend, strategy, retail growth model, retail establishment classification, retail locationplanning, synthetic retail policies, and practical researches on the retail market inthe rural areas of Red River Delta region However, there is no work that fullysynthesizes the definition of staple goods and clarifies the theory of the retail system
of enterprises associated with specific characteristics of the rural area, as well as nopractical research on the retail system on staple goods in the Red River Delta at theperspective of micro enterprise
Therefore, the dissertation "Studying the retail system of staple goods of Vietnamese enterprises in the rural areas of the Red River Delta region" is
essential and suitable to the current research context It has succession but does notoverlap with previous published studies
2 The objectives and questions of research
a) Research objectives
The general objectives of the study are to clarify the theoretical basis of the
retail system of staple goods of enterprises in association with specific rural areasand to propose some solutions to improve the retail system of staple goods ofVietnamese enterprises in rural areas of Red River Delta region
The specific objectives
- Systematizing and clarifying the theoretical basis, research content on theretail system of staple goods of enterprises in the rural areas
- Assessing the status of the retail system of staple goods of Vietnameseenterprises in the rural areas of the Red River Delta region
- Proposing solutions to complete the retail system of staple goods ofVietnamese enterprises in the rural areas of the Red River Delta region in thecurrent period
Trang 2- What are the successes and limitations of the stable goods retail system
in rural areas of the Red River Delta of Vietnamese enterprises?
- What are the solutions to complete the staple goods retail system in ruralareas of the Red River Delta of Vietnamese enterprises?
- What are the recommendations for the State agencies to supportVietnamese enterprises to complete the staple goods retail system in rural areas
of the Red River Delta?
3 Topic and scope of the study
a) Topic of the study
The topic of the study is the theoretical and practical issues about the retailsystem of stable goods of Vietnamese enterprises in rural areas
b) Scope of research
Content coverage
The thesis studies the retail system of staple goods, which focuses onresearching the retail system of staple goods of enterprises in the rural areasincluding the following contents: analyzing the circumstance of the retail system ofstaple goods of enterprises in the rural areas, planning the retail system, designingsynthetic retail policies (goods, store design and goods representation)
The study does not delve into the contents related to the warehouse andlogistics system of staple goods retail businesses
The staple goods researched in the study is goods to serve the necessary needsfor daily life of people, not for production and other fields
Geographical coverage
The study focuses on researching the retail system of staple goods ofVietnamese enterprises (enterprises established or registered under Vietnamese law,headquartered in Vietnam and owned by Vietnamese people with 50% of theauthorized capital) in the rural areas of Red River Delta region
Studies on retail systems of Vietnamese enterprises in urban areas or outsideRed River Delta or foreign-invested enterprises (accounting for over 50% of theauthorized capital) are used as lessons
Lessons learned from some countries such as India, China and southernVietnam
Time coverage
Practical studies were mainly conducted during 2013-2018 and proposedsolutions to 2025
With the topic and scope of the research identified above, the research model
of the thesis is established as shown in Figure 0.1:
Trang 3Figure 0.1: Dissertation Framework
Source: Illustration of author
Surveys
Rural customers
Demand and solvency Behavioral characteristics Staple goods shopping habits Evaluation of different types of staple goods retail facilities
The environment
of retail system of
staple goods in
the rural areas of
the Red River
Delta region
Staple goods Retailers
Analyze the statistics of the retail system of staple goods
Identify goals with the retail system of staple goods Plan the retail system of staple goods
Design of synthetic retail policies Evaluate the retail system of staple goods
Surveys and interviews
system of staple goods
of Vietnamese enterprises in the rural areas of the Red River Delta region Evaluating the success and limitations of the retail system of staple goods of Vietnamese enterprises in the rural areas of the Red River Delta region Determining the limited causes of the retail system of staple goods of Vietnamese enterprises
in the rural areas of the Red River region
staple goods of Vietnamese enterprises in the rural areas of the Red River
region
Objectives to complete the retail system of staple goods
of Vietnamese enterprises in the rural areas of the Red River Delta region
Solution to complete the retail system of staple goods of Vietnamese enterprises in the rural areas of the Red River
region
Forecasting the environment and market for the retail businesses
of staple goods in the rural areas of the Red River region
Proposing to the State Management Agency
Determining opportunities and challenges of Vietnamese retail enterprises
Trang 44 Research methodology
The study stages are presented in Figure 0.2
Figure 0.2: Stages of collecting and processing data
Source: Illustration of author
5 Scientific and practical significance of the research
(1) In theoretical perspective, the dissertation contributes clarification to the
theoretical framework of staples retail system of enterprises in association with ruralareas and systematize criteria for evaluating retail system including proposing newcriteria regarding society, personality and business image
(2) In practical perspective, the dissertation analyzed and evaluated
objectively and reliably the status of staples retail system of Vietnamese enterprises
in rural area of Red River Delta This contributes to the overview of the currentstatus such enterprises in the current context from a micro-approach point of view
(3) In terms of applicability, the dissertation proposes 06 orientational and
applicable solutions for enterprises including: Perfecting staples retail systemassociated with long-term retail strategy for enterprises in rural area of RedRiver Delta; Completing the structure of staples retail system for enterprises inrural areas of Red River Delta; Improving location system planning technologyfor Vietnamese staples retail enterprises in Red River Delta; Building a brand ofVietnamese retail businesses, designing suitable product assortment forVietnamese economy; Improving management capacity and qualification forlabor force; Enhancing the application of science and technology in completingstaples retail system of Vietnamese enterprises
Simultaneously, the dissertation proposes to relevant central and local statemanagement agencies to improve the retail environment to help Vietnameseenterprises with favorable conditions to complete the staples retail system in ruralarea of Red River Delta until 2025
Collect and analyse primary data
Collect and analyse
secondary data
- Determine sources of data
- Verify and collect data
(Case study)
- Survey a group of 07 experts
- Survey 115 retailers
- Survey 372 staple buyers in rural area of Red River delta
- In-depth interview a group of 05 retail managers
Researh report
Trang 56 Structure of the dissertation
In addition to the introduction, conclusion, the dissertation has been structuredwith 4 chapters, including:
Chapter 1: Literature review and research gaps
Chapter 2: The rationale of the staples retail system in rural areas of enterprisesChapter 3: Current situation of staples retail system of Vietnamese enterprises inrural areas of the Red River Delta
Chapter 4: Solutions for completing the staples retail system of Vietnamese
enterprises in rural areas of the Red River Delta until 2025
Trang 6CHAPTER 1: LITERATURE REVIEW AND RESEARCH GAPS
1.1 Literature review
According to the research perspective and ability to approach materials, thisthesis has assembled notable research projects related to staple goods retail system
in rural areas of enterprises
1.1.1 Literature review on retail systems
Research on context, retail development trends, rationale related to retail,retail system have typical contributions of authors: John Fernie and authors(2003), Philip Kotler (2007), Nguyen Bach Khoa and authors (2011), MichaelLevy and authors (2014), Nguyen Thi Hue (2014), Ta Loi (2016) In particular,the domestic research projects are associated with the characteristics of ourcountry such as the classification of retail facilities by author Nguyen BachKhoa, author Nguyen Thi Hue, the impact of implementing new generationFTAs on our retail system of author Ta Loi
Research on retail growth strategy and retail model has typical contributions
of authors: Malcolm Sullivan and Dennis Adcock (2011), Surajit Dey and authors(2012), Barry Berman and authors (2017)
Research on key elements in retail marketing, retail system management,which include research on retail systems (mixed retail locations, policies …)have typical contribution of authors: Graham Clarke (1998), Philip Kotler(2007), Le Quan and Hoang Van Hai (2010), Malcolm Sullivan and DennisAdcock (2011), Nguyen Bach Khoa and authors (2011), Pham Huy Giang(2011), Truong Dinh Chien (2012), Michael Levy and authors (2014), BarryBerman and authors (2017) In particular, Graham Clarke deserved credit forgeneralizing the methods of retail location planning that have been developed
by businesses in retail countries over the times
1.1.2 Literature review on retail systems in rural areas
Research on rural consumers in different countries, rural markets inVietnam have typical contributions of authors: Sanal Kumar Velayudhan(2007), Jiyoung Kim and Leslie Stoel (2010), Surajit Dey and collaborators.(2012), Chintan Shah (2013), Massoud Moslehpour and Van Kien Pham (2013),Pham Hong Tu (2013), Nielsen (2014), Claire Seaman (2015), Dang HuyenTrang (2016) In particular, Surajit Dey has proposed to advance organizedretail model in rurral Indian market
1.1.3 Literature review on staples retail systems in rural areas of Red River Delta
of Vietnamese enterprises.
Research on retailing staple goods has contributions of authors: Nguyen ThiBich Loan (2013), Trinh Thi Thanh Thuy (2015) The two authors both approached theresearch according to the supply chain of staples on the domestic market and selected atypical study of the supply chain of some typical staple goods
Trang 7There are also a number of research projects on retail in rural areas of RedRiver Delta of donmestic authors such as Pham Huy Giang (2011), Pham Hong
Tu (2013)
1.2 Research gaps
From the overview of research on typical projects related to the researchcontent of the topic, researchers now point out the research gap:
In theoretical terms, although previous theories were applied to retail in both
rural and urban areas, they did not clarify the specific characteristics in theory ofretail systems in rural areas of enterprises Besides, the definition and identification
of staple goods in some previous research projects have not been concluded andassociated with the specific needs of rural consumers Criterias for evaluating retailsystems mainly focus on financial criteria
In practical terms, research primarily approach at macro perspective, manage
the government for rural retail market or stop at studying the rural consumersbehaviour nationwide or a province, there has not been any practical research onretail systems of staple goods in rural areas of Red River Delta in terms ofenterprises
From the research gaps discoverd above, the thesis aim to clarify thedefinition of staple goods, delineate the content of researching on staple goodsaccording to the micro-approach perspective of enterprises Propose to add someevaluation criteria to fully systematize groups of criteria for assessing HTDTY retailsystem of enterprises Based on the systematized and clarified arguments,conducting a survey of the status of staples retail system of Vietnamese enterprises
in the Red River Delta On that basis, this thesis points out the limitations of theretail system to propose some solutions and recommendations to help Vietnameseenterprises complete their staples retail system in the Red River Delta
Therefore, the dissertation is new, not duplicated and inherits the works ofprevious research
Trang 8CHAPTER 2: THEORETICAL BASIS OF STAPLE GOODS RETAIL
SYSTEMS IN RURAL AREAS OF ENTERPRISES.
2.1 Overview of staple goods retail systems in rural areas of enterprises.
2.1.1 Basic definitions
2.1.1.1 Staple goods
In Vietnam, undergone the development process, the definition of staplegoods is mentioned in a great deal of legal documents with numbers and typeschange over the period, associated with the local custom and tradition Although theapproach and classification of staple goods of Vietnam and international countrieshave certain differences, but both agree in the aspect that they are to meet the basicand essential needs of the majority of the population From that point of view, thedefinition can be synthesized:
“Staple goods are essential and indispensable goods for daily life to meetbasic human consumption needs”
2.1.1.2 Retailing staple goods
Retailing staple goods is a business activity that involves selling essentialgoods for daily life to meet the basic, direct needs of the end consumer for theirpersonal use, not for business
2.1.1.3 Staple goods retail system of enterprises
Staple goods retail system of an enterprise is an organized collection of stores ofthat enterprise, having an interactive, binding relationship with each other and workingtogether to retail goods which are essential for daily life, meet basic and direct needs tocustomers and eventually letting them use for personal, non-business purposes
2.1.1.4 Research on staples retail system in rural areas of enterprises
The rural area is an administrative boundary area not covering the area of award or a district in a town or city and is managed by the basic administrative level,the People's Committee of a commune or town or township
Studying on staple goods retail system in rural areas of enterprises is understood
as all business activities including: situation analysis, target determination, planningsystem of points of sale and design of mixed retail policies in order to perfect the staplegoods retail system of businesses in communes, towns and townships
2.1.2 Basic characteristics of staple goods retail system in rural areas of enterprises
- Regarding the structure of staple goods retail system of enterprises in
Vietnam: Retail facilities belonging to staple goods retail system of enterprises in
rural areas are mainly in the form of agents of manufacturers, distributors orconvenience stores and mini supermarkets
- Regarding the distribution of points of sale of staple goods retail system of
enterprises in rural areas: The density is still low, not covering the market, not
creating a retail brand for consumers, mainly concentrated in the area town area
- Regarding the structure of goods in staple goods retail system of enterprises in
Vietnam: Focus on exploiting to meet the great demands of rural consumers, including
processed food, personal care and family goods, stationery products
Trang 9- Regarding the provision of additional services and services in staple goods
retail system of enterprises in rural areas: modern stores have not had many
opportunities to penetrate into the rural market
- Regarding the method of promotion in the retail system of staple goods and
branding of enterprises: the form of promotion is mainly
- About staff in staple goods retail system of enterprises: limited quantityand quality
2.1.3 The role of staple goods retail system in rural areas of enterprises
2.1.3.1 The role for consumers and the community
- Changing consumer habits, bringing local people the opportunity to experiencecivilized shopping environment, modern and comfortable retailing methods
- Contributing to economic growth and the local development
- Creating jobs for local workers
- Improve the quality of life of people
2.1.3.2 The role for businesses
- Connecting production and consumption in rural areas
- Connecting information from consumers to manufacturers and vice versa
- Helping retail businesses dominate the rural market
2.1.4 Popular types of retail in the staple goods retail system in rural areas
of enterprises
2.1.4.1 Types of staple goods retail system according to sales method
a) Types of traditional stores include: Traditional wet market; Traditional grocery
store
b) Types of modern stores: Trade center; supermarket; mini supermarket;
convenience store; specialty store.
2.1.4.2 Types of staple goods retail types according to ownership form
Classification of form of staple goods retail patterns by ownership classincludes some basic types as follows: Independent unitary establishment; Retailchain stores; Retail cooperative sales base; Retail facilities belonging tomanufacturers; Franchising retail facility
2.2 Contents of research on staples retail system in rural areas of enterprises
2.2.1 Situation analysis of staple goods retail system in rural areas of enterprises
2.2.1.1 External factors
External factors include: Market factors; Competitive factors; Factors related
to the fluctuation of environment
2.2.1.2 Internal factors
Internal factors include: financial resources; locations and retail spaces inrural areas; human resources; relationship with suppliers; supply chain managementsystem; collecting and processing market information system, customers
2.2.2 Identify the targets for staple goods retail systems in rural areas of enterprises
a) Financial target
Financial target is the most important target, including quantitative,
Trang 10measurable indicators Indicators are divided into two levels: Company/retail sytemlevel and store level/sales methods.
Financial goals are also divided into groups: Input target; Output target;Productivity targets
b) Meeting customers’ needs target
Staple retail enterprises are not only aiming to sell lots of goods, collect lots ofmoney from customers, but more importantly to meet customers’ needs, bring valueand satisfy customers with the whole shopping experience
c) Other targets
In addition to the target mentioned above, staple retail enterprises in rural areacan also set other personal and social goals, positioning business images
2.2.3 Planning location for staples retail in rural areas of enterprises
2.2.3.1 Determine the area in the staples retail planning system of enterprises
a) Identifying areas in staples retail system planning in association with retailstrategy of enterprises
- Buying behavior of customers on the targeted rural market of the enterprise
- Targeted rural markets’ density
- Uniqueness of retail services
b) Identifying retail areas with consideration of law and social factors
When selecting areas, locations to set up staples selling points in rural area,enterprises also need to consider issues such as the development of new rural areas close
to the urban areas, the hypermarkets development against trend, retail planning systemfor the area of the local state agencies, construction standards, administrative procedures
2.2.3.2 Identifying retail locations in the staple retail planning systems in rural areas of enterprises
a) Evaluate locations to determine the location and number of retail points in one rural area
Factors used to consider include: (1) Economic conditions, (2) competitionlevel, (3) strategy of the population in the area and target market relevance level, (4)operating cost When analyzing and selecting areas, retail enterprises also need todecide the number of selling points in each rural area
b) Factors to consider when evaluating a specific staples retail location
There are 3 factor groups: characteristics of retail locations; characteristics ofthe trade area; the store's expected sales
2.2.4 Design mixed retail policies in rural areas of enterprises
The approach of designing retail policies (goods management, store design)with the specific characteristics of rural area are generalized in the 4As approach:Affordability, Availability, Acceptability, Awareness (Chintan Shah, 2013)
2.2.4.1 Merchandise management policy for rural areas
a) Merchandise management system in retail enterprises
In general, retailers have the same basic structure in classifying andpurchasing staple goods: merchandise group, department, classification, SKU.b) Product assortment and merchandise planning
Product assortment of a staple retail enterprise manifests through 4
Trang 11parameters of breadth, depth, length and consistency of the assortment (NguyenBach Khoa and Cao Tuan Khanh, 2011).
Merchandise planning includes two processes: product assortment planningand merchandise value planning (Dang Van My, 2017)
c) Pricing for retailing staple goods
Rural consumers not only concern about low prices, but also willing toconsider higher prices if the product brings practical benefits
2.2.4.2 Staple goods store design in rural areas
a) Objectives of store design
The main objectives of store design are to (1) implement corporate strategy,(2) build loyalty by providing satisfactory shopping experiences for rural customers,(3) increase sales per purchase, (4) control the cost, and (5) meet legal requirements.b) Elements of store design
There are three main factors needed to be considered in designing retailstore for staple goods, those are : (1) Site layout, (2) Table, signboard and imagesystem, (3) Special area
2.3 Criteria for evaluating staple retail systems in rural areas of enterprises
The evaluation criteria can be divided in to groups, including: financialcriteria; criteria for assessing customer satisfaction; other evaluation criteria
2.4 Domestic and international experience on staple goods retail system in rural areas and lessons for Vietnamese enterprises
2.4.1 Experience of Bach Hoa Xanh mini-supermarket chain of Mobile World Joint Stock Company (in the South of Vietnam)
Bach Hoa Xanh mini-supermarket chain (BHX) has a retail system coveringurban areas and penetrating rural markets in Ho Chi Minh City and neighboringprovinces This model is a valuable practical lesson for Vietnamese staple retailenterprises in Red River Delta o complete their retail system in current and future period
2.4.2 Experience of Pantaloon Retail India Ltd (India)
The organization manages the retail system in the Western way but factorssuch as store layout, goods display, valuation, store atmosphere follow the customs
of each area, including rural ones of India This innovative application has helpedPantaloon brand to quickly approach the very traditional customers, as well as tohave a modern and effective management model
2.4.3 Combining e-commerce with rural retail systems of JD.com (China)
JD.com's innovative ways of integrating e-commerce with rural retail outletshave helped this enterprise to expand its retail system across Chinese rural markets.This is an outstanding experience for Vietnamese enterprises in investing andcompleting staple goods retail system in rural area of Vietnam
2.4.4 Lesson manipulated in staple goods retail system in rural areas of Vietnamese enterprises
Lessons manipulated for Vietnamese enterprises: Firstly, it is necessary to
carefully study about the characteristics of Vietnamese rural customers and
determine the potential of the rural market that they chose; Secondly, assortment,
Trang 12display and pricing of commodity; Third, forming local supply chain and using local labor; Fourth, combine store and e-commerce retail in rural areas.
CHAPTER 3: CURRENT SITUATION OF STAPLES RETAIL SYSTEM
OF VIETNAMESE ENTERPRISES
IN RURAL AREAS OF THE RED RIVER DELTA 3.1 Overview of the retail environment of staple goods in rural areas in Red River Delta
3.1.1 Natural, socio-economic conditions in rural areas in Red River Delta
The Red River Delta currently has 11 provinces and cities Rural areas in RedRiver Delta include 2018 communes and towns
The topographic and transport conditions are quite favorable with the highestpopulation density over the country, helping the Red River Delta become anattractive market for the development of retail trade
3.1.2 Domestic policies and international commitments relating staples retailing
in rural areas in Red River Delta
The domestic policies and international commitments relating staples retailingbring Vietnamese enterprises in the rural areas in Red River Delta not onlydevelopment opportunities but also challenges:
Opportunities for enterprises: infrastructure development, improve rural
inventory system; policies for developing modern retail types (such as supermarkets,shopping centers) of enterprises has gradually approached rural markets; diversitysources of goods brought from FTAs have been valid
However, some limitations still exist, along with no motivation and hidden challenges against Vietnamese enterprises such as: The overall strategy for the retail
industry is still in progress; enterprises are not received incentives in financialmerchandise and private credit; overlapping policies; quality control is not tight; there
is no mechanism to encourage human resource training for retail industry; there is nopolicy to promote the establishment of trading centers connecting retailers andmanufacturers; slowly issued plan cannot adapt with the change; there is no specificincentive policies for enterprises who develop a staple retail system in rural areas
3.1.3 Overview of consumers in rural areas in Red River Delta
- Due to the increasing income, living expenditure is expected to increase
- Urbanization has helped to narrow the gap between rural and urbanconsumers
- Two traditional retail types (markets and grocery stores) are still the firstchoice, however, more than 30% of rural customers have approached and shopped
in modern retail formats
- Personal care products, household items, milk, spices are purchased fromsupermarket and shopping malls but with low frequency
- Convenience and proximity are also the criteria affecting decisions ofpurchasing location
- Rural consumers are influenced by crowds more than urban ones
- Three important channels of information for rural people in the North of