Solutions to enhance handicraft export activity to US market of thuy anh co ,ltd

However, the export turnover of handicraft products of the company tothe US market is small, not really commensurate with the potential of exportinghandicrafts of the company.. - Proacti

ACADEMY OF POLICY AND DEVELOPMENT

INTERNATIONAL SCHOOL OF ECONOMIC AND FINANCE

GRADUATE INTERN REPORT Topic: “Solutions to enhance handicraft export

activity to US market of Thuy Anh Co.,ltd.”

Teacher : Phạm Mỹ Hằng Phương Student : Hoàng Thị Mai Oanh

Hà Nội, June 6/2019

To complete this graduation internship report, I have received enthusiasticguidance and help from teachers in the School of Policy and Development

First of all, I would like to thank the teachers who have devotedly taught

me during my studies at the School of Policy and Development!

I would like to express my deep gratitude to the teachers in theInternational Training Department, in particular, Ms THS Pham My HangPhuong has dedicated and supported me so I can finish this graduation thesis

At the same time, I would also like to express my sincere thanks to themembers of Thuy Anh Co., Ltd for helping me during the internship Thanks tothe internship and instructions of the teacher and the company's staff, I can dothis final thesis

Although I tried to perfect my graduation thesis, due to limited knowledgeand experience, I could not avoid errors Therefore, I look forward to receivingcomments from teachers

1 Back ground

In the process of industrialization and modernization of the country,Vietnam has determined that exports are a breakthrough in economicrestructuring, contributing to the successful implementation of the communeeconomic objectives Assembly Over the past years, exports of handicraft goodshave brought great benefits not only in economic terms but also in culture andsociety, contributing to changing the appearance of rural Vietnam Handicraftproducts are the crystallization of physical and spiritual labor, it is created bytalented hands and creativity of craftsmen with national cultural values fromproducts Handicraft goods are no longer merely goods but they become culturalproducts with high art Some are considered symbols of national culturaltraditions Export of handicraft goods has both high economic efficiency andtake advantage of available resources, create jobs and stable income for a largenumber of rural laborers and contribute to preserving and promoting cultural andsocial values, preserving traditional skills Over the past years, Vietnam hasachieved some encouraging results in producing and exporting handicraft goods,gradually building prestige and brand in the international market

America is an important economic partner of Vietnam in recent years,especially after Vietnam joined the World Trade Organization (WTO) andnegotiated the Strategic Economic Partnership Agreement across Thai Binh.Ocean Vietnam's export turnover to the US market has continuously increased

in recent years In particular, handicraft items are one of Vietnam's key productsexported to the US market Over the past few years, a number of businesses havefocused on investment in manufacturing handicrafts for export and haveachieved some remarkable successes In which, there is a significant contribution

of Thuy Anh Co., Ltd America is considered by the company as a potential

market However, the export turnover of handicraft products of the company tothe US market is small, not really commensurate with the potential of exportinghandicrafts of the company Therefore, I chose the topic: "Solution to promotethe export of handicraft items to the US market of Thuy Anh Co., Ltd." as theresearch topic for my graduation thesis.

2 Research objective

- Research Question: How are export situations and what are the solutions

to US handicraft market of Thuy Anh Co., Ltd?

- General Objectives: The topic of analyzing and evaluating the export ofhandicraft products and proposing solutions to boost the export of handicraftproducts of Thuy Anh Co., Ltd

Chapter 1: LITERATURE REVIEW

Chapter 2: EXXPORT ACTIVITIES OF THUY ANH CO., LTD

Chapter 3: EVALUATION AND RECOMMENDATIONS

CHAPTER 1: LITERATURE REVIEW1.1 Overview of Export and Import

According to the Commercial Law 2005, the concept of export is defined

as follows: “Export of goods means that the goods are taken out of the territory

of Vietnam or brought into a special area in the territory of Vietnam, it isconsidered a zone separate customs area in accordance with the law”

In this thesis, I understand export in international trade is a good or serviceproduced in one country that is bought by someone in another country Export ofgoods often requires involvement of customs authorities

Exports, along with imports, are a key element in a country’s trade balance

as the sale of exported goods increases a nation’s gross output Many countriesencourage exports as a way to increase employment, disposable income, andconsumer spending Furthermore, the more products a country exports, thegreater the competitive advantage as it gains expertise in producing goods andservices that foreign countries want to use

 Import definition

According to master Troy Segal from Harvard College, the concept ofexport (updated Apr 30, 2019 on Investopedia) is defined as follows: “Import is

a good or service brought into one country from another The word "import"derives from the word "port" since goods are often shipped via boat to foreigncountries Along with exports, imports form the backbone of international trade.

If the value of a country's imports exceeds the value of its exports, the countryhas a negative balance of trade (BOT), also known as a trade deficit”

According to the Commercial Law 2005, the concept of import is defined

as follows: “Import of goods means that the goods are brought into the territory

of Vietnam from foreign countries or from a special area located in the territory

of Vietnam which is considered a separate customs area in accordance with thelaw.”

In this thesis, I understand an import is a good brought into a jurisdiction,especially across a national border, from an external source The party bringing

in the good is called an importer An import in the receiving country is an exportfrom the sending country

Imports, along with exports, are a key element in a country’s balance oftrade as the lower the value of imports, the more positive the balance of trade inImport Countries that have high import levels face a trade deficit, and they need

to increase their reserves to pay for the imported goods

Furthermore, there are countries, mostly in the under-developed or thedeveloping economies, which rely on imports of basic commodities, such as oiland industrial materials Generally, countries tend to import goods or servicesthat they cannot produce at the same low cost or with the same efficiency thatother countries can

Importation and exportation are the defining financial transactions ofinternational trade In international trade, the importation and exportation ofgoods are limited by import quotas and mandates from the customs authority.The importing and exporting jurisdictions may impose a tariff (tax) on the goods

In addition, the importation and exportation of goods are subject to trade

agreements between the importing and exporting jurisdictions

 Definition of export promotion

As Wikipedia, the concept of Trade promotion is defined as follows

“Trade promotion is an umbrella term for economic policies, development

interventions and private initiatives aimed at improving the trade performance of

an economic area Such an economic area can include just one country, a regionwithin a country, or a group of countries involved in an economic trade area.Specific industries may be targeted Improvement is mainly sought by increasingexports both in absolute terms and relative to imports When specific industriesare targeted, trade promotion policies tend to target industries that have acomparative advantage over their foreign competitors Trade promotion can alsoinclude expanding the supply of key inputs in a country's strongest industries, viaimport expansion If successful, such a tactic would lead to pro-trade biasedgrowth”

As an economic policy with the ultimate goal of increasing domesticwelfare, trade promotion comprises a large set of policy instruments Onenotable tactic is the provision of trade intelligence to domestic enterprises inorder to reduce transaction costs and provide them with a competitive advantagevis-à-vis foreign companies Many countries all over the world have set upspecial agencies, most of them in the public domain, to implement tradepromotion policies and provide support services to domestic enterprises

Some international organizations provide assistance to so-calleddeveloping countries to help them promote their exports, most prominently theInternational Trade Centre in Geneva, which is a subsidiary of the World

Trade Organization and the United Nations with a mandate to providing related technical assistance to those countries.

Advantages of direct export:

- A direct discussion is easy to lead to unity, less misunderstanding

- Reduce intermediate costs

- Conditions to penetrate the market, promptly receive customers' opinions,overcome shortcomings

- Proactive in the process of production and consumption of goods

- The surprise in the new market

- The company is often forced to reduce prices while selling

- The volume of goods that need to be traded, must be large to payexpenses such as papers, travel expenses, investigation fees to understand themarket

 Entrusted export

In trust export - a form of intermediary trading, the relationship between the seller and the buyer and the terms and conditions of the sale must be through a

third party This third party is called a middleman The popular intermediaries in the world market are agents and brokers.

The use of commercial intermediaries (agents and brokers) has the same benefits:

- The intermediaries often have a clear understanding of the local market,law and culture situation, so they are able to promote trade and avoid risk to thetrustee

- The intermediaries, in particular, agents often have stable facilities, so when hiring them, the mandate helps to invest directly abroad

- Thanks to intermediary services in the selection, sorting, packaging,

mandators can reduce transportation costs

However, the use of intermediaries has disadvantages such as: Import-exporttrading company loses direct contact with the market; Companies also often have

to meet agency or broker policies; Profit sharing

 Counter-trade

Counter-trade is a method of exchanging goods, exporting activities in a waythat closely integrates with imports, the seller is also the buyer, the amount ofgoods delivered is worth commensurate with the quantity received The purpose

of export is not to collect foreign currency, but to collect another commodity ofequivalent value Counter- trade has long appeared in the history of goods-currency relations, in which the earliest "barter"

There are many types of trade such as: barter, compensation, purchase, offset, buy-backs

counter- On-spot Export

This is a form of local export enterprises to collect foreign currency throughdelivery or sales to businesses that are operating in the territory of Vietnamunder the designation of foreign parties; or selling goods to export processingzones which are operating in the territory of Vietnam

Characteristics of on-spot export: The signing contract is a foreign tradecontract; Goods and materials are objects of sale and purchase of contracts, notexported out of Vietnamese territory; Enterprises must fully carry out customsprocedures for on-the-spot export (opening customs declarations on-the-spot)and other procedures for a tax refund

 International outsourcing

International processing is a method of commercial business in which oneparty (called the outsourcer) assigns (or sells) materials or semi-finishedproducts to another party (called the processor) for processing the finishedproduct is re-delivered (or resold) to the processes and receives remuneration(called processing fee) For outsourcers, this method helps them take advantage

of cheap raw materials and labor of the country that receive processing Foroutsourced parties, this method helps them to create jobs for domestic workers orreceive new equipment or technology in their countries, in order to build anational industry

 Re-export transactions

Re-export is a form of export of goods previously imported andunprocessed in the country of re-export Re-export is a method of trading that there-exporter does not aim to serve domestic consumption but only temporarilyimport and then re-export to make a profit Participating in the re-export

transaction method, there are always 3 countries that are exporting countries, importing countries and re-exporting countries.

1.1.3 Role of export

 The national economy

Export of goods is an international trading business, not a single trade, it is

a system of trading relations in a comprehensive organized trade to sell products.domestically produced products and goods; develop and transform the economicstructure to gradually improve people's living standards Therefore, export is anexternal economic activity that has brought positive effects to a country'seconomy

Firstly, export activities create an important source of foreign capital toensure import demand

Secondly, export activities promote the country's advantages

Thirdly, export activities contribute to shifting production structure,production orientation, promoting economic growth

Fourthly, this creates jobs for workers, creates income and increases livingstandards for people

Fifthly, export activities enhance Vietnam's prestige in the world marketand help strengthen external economic relations

Secondly, increasing sales: The market is expanding, the number ofcustomers increases leading to increase sales.

Thirdly, learning from experience: Companies have the opportunity tolearn about business experiences of partners, businesses in developed countriesand have the opportunity to change the business structure accordingly to meetthe trend of globalization when international competition increased

In summary, export activities bring a lot of benefits to businesses This isthe first step for businesses to conduct international business activities.Therefore, costs, as well as risks when there is fluctuation related to the businessenvironment, will be lower than other international business activities

1.1.4 Factors affecting export

1.1.4.1 The objective factors

The business environment can create favorable conditions to promote theexport of enterprises, but it can also be barriers to create difficulties and inhibitthe development of export activities In international trade, the factors thatdepend on the business environment are very rich and complex Factors affectingexport promotion such as:

- Local economy and international economy

- Legal politics

- Natural conditions

 Local economic factors and international economy

Economic factors such as economic growth rate, inflation rate,

exchange rate, monetary and credit policies, policies to encourage economicdevelopment, of host countries are weak The factor has a direct impact onthe business activities of enterprises and exporters of handicraft products inparticular Besides, the international economic factors will also have a great

impact on the company's operations, affecting the demand and ability toimport goods of international enterprises, and impacting prices export ofgoods:

The exchange rate is the price of one currency of this country expressed inthe number of currencies of another country

In international trade, the payment currency is usually foreign currency foreither party or both parties Therefore, when the currency serves as a means ofpayment, the benefits of either party will be damaged When the exchange rateincreases, the price of exported goods becomes expensive, the competitiveness

of such goods on the world market will be reduced, which will affect the exportpromotion activities of enterprises On the contrary, when the exchange ratefalls, the depreciation of the local currency against the foreign currency willbenefit businesses when promoting exports

 Quotas and technical standards

Quotas are state regulations on the maximum quantity of goods allowed to

be exported or imported for a specific market for a certain period of time usually

1 year Quotas are often used to avoid oversupply, which damages producers andexporters It is applicable to exported goods of natural resources and at risk ofbeing depleted or polluting the environment

Stemming from the real needs of life, the need for hygiene and safety,quality A series of standard systems are in place, including regulations onpackaging, packaging for safe and hygienic hygiene products, hygiene andepidemic prevention This greatly affects the export promotion activities ofenterprises Because products of enterprises that want to penetrate into markets,they must fully meet quality standards quantity, environment, of the importing

country and the standards of each country are different Therefore, quotas andtechnical standards will be barriers for businesses that are trying to promote theirproducts and services to different markets in the world.

 Political elements - law

The legal policy system has a strong influence on all activities ofexport enterprises Preferences or barriers on tariffs, technical barriers,regulations for goods that are allowed to export or other policies of theexporting country and the country of import have the effect of promoting orlimiting exports goods These conditions affect the business decisions ofenterprises by taking advantage of state incentives and limiting obstaclesthat the above provisions can bring

Politics needs stability for economic development This factor is a factorpromoting the export of goods and services The stable political environmentcreates comfortable psychology, confidence in production and business therebypromoting export development Each country has its own legal system toregulate its import-export business Therefore, enterprises must have a certainunderstanding of these factors to create a safe legal framework for exportactivities and export promotion

The exporting country can be successful in the international market if theyhave a certain understanding of customs, practices, tastes, and habits that differfrom country to country Therefore, an understanding of the cultural environmentwill help in the adaptation of the country to the market so that it has the rightstrategy in expanding its market and promoting its export activities

 Natural condition

Natural conditions have a great influence on promoting the export of handicraft products of enterprises Natural factors affect the input of production

activities Any country with rich resources will have advantages and potentials towell implement export promotion activities.

1.1.4.2 Subjective factors

Subjective factors are the characteristics and potentials of enterprises that directly affect the operational efficiency of enterprises

 Capital and financial capability

This is a factor that reflects the full power of the business through theamount of capital that businesses can mobilize into business, the ability toeffectively distribute investment capital Mobilizing all the capabilities ofthe enterprise's capital helps businesses carry out business activities moreeasily In fact, most businesses use a huge portion of their loans, not equity.Therefore, when assessing the ability to mobilize capital, enterprises musttake into account the mobilization of capital from different sources such ascredit, mortgage If an export enterprise has abundant capital and financialresources, businesses will have advantages in the market All research andmarket expansion, product quality improvement to export, application ofscience and technology in production and business, communication, salescontact in export business, It is necessary to use capital and financialresources of enterprises

 Human factors

Export promotion is an important activity of export enterprises Therefore,

it requires a high professional level of human resources in the market researchand marketing phase to produce products Wanting to promote export activitieswith high efficiency, businesses need to take care and training to fosterknowledge for employees Enterprises need to recruit business employees

through recruitment exams that are done scientifically and objectively and onlyselect those who have the standard such as: sufficient professional skills,creativity, ability to speak guess, the ability to adapt to the company's workingenvironment and culture Besides, the company needs to send experts to studyand study at professional training courses organized by other agencies Ifpossible, the company should send experts to study and study abroad to improvethe professional level, understand the market reality and help export.

1.2 Content of Export promotion

 Rapid increase in output and export turnover

The aim of businesses is to promote exports to foreign markets byincreasing export volume to that market to actively exploit import markets,spreading the appearance of products on the export market However, enterprisesneed to predict the demand as well as the volatility of export products in theworld market so that they can promptly cope with possible business risks Inaddition, in order to increase export output without leading to an increase in non-essential costs, businesses need to calculate production scale accurately

 Diversifying export products

Enterprises can promote exports by implementing diversification ofexports by the psychological preference for innovation and novelty of people.Enterprises can diversify by creating new designs or using a variety of differentmaterials to create differences and abundance for products, evoking new andinteresting from customers

 Research and expand export markets

Market expansion can be good exploitation of the current market,promoting the export of existing products to the current market and expanding itsmarket share in that market or searching for markets The school has a need for

the company's business products, with potential that the company can exploit.Market diversification also helps businesses avoid risks when the situation of thedomestic market where businesses are doing business faces political risks oreconomic recession.

 Complete the market research system

We need to study the business environment, customs, consumer culture,interests, beliefs, and level of payment so that we can correctly determine exportgoods and match them consumer trends The market research here includesmarket research by country and specific commodity research Enterprises mustanalyze the domestic market forecasts, competitors in the export market plan andforecast market fluctuations Thereby, take advantage of opportunities and limitpossible risks

In a fiercely competitive market, the company must choose marketresearch methods, carry out effective market research before making a finaldecision on which market to choose If the company determines exactly this, thecompany will make a right decision

Businesses can gather information on both Vietnamese and foreign booksand magazines along with information on the Internet Appointing staff toconduct market surveys, participate in trade fairs both at home and abroad tocapture market information Enterprises conduct analysis and synthesizeinformation, take seriously to make a rational and feasible decision

Market research requires a lot of effort and must be taken seriously If thecompany incorrectly assesses market demand or misjudges market fluctuations,

it can lead to serious consequences for the company Therefore, this workrequires qualified and professional staff to perform with complete, accurate andhighly reliable information

 Expanding new markets, building close relationships with the old market.

The world market is very large but because there are certain limitations, inaddition to focusing on improving the quality of goods, lowering product prices

to increase the competitiveness of goods The company must improve marketingcapacity, actively carry out export promotion activities to markets, seek partnersand offers through fairs and seminars that are held in Vietnam or in foreignmarkets

Besides expanding new markets, maintaining the existing market is alsovery important In order to retain these customers in addition to improving thequality of goods, there should be reasonable incentives such as promotions forcustomers or discounts when purchasing large quantities and incentives for long-term customers

 Complete and develop distribution channels

Enterprises that want to promote exports need to improve and developproduct distribution channels A distribution channel is a way that an enterprisecarries goods from its place of production to a consumer or final consumer.Therefore, it needs to be designed in a balanced way to perform the tasks ofbringing goods from after production to consumption Distributors must wellhandle the problem of choosing the source of goods to buy and sign a contract tobuy products, choose a means of transport and a contract to transport and arrange

a warehouse system to serve the storage of goods and convey transportation,especially the handling of international logistics information systems

Distribution channels greatly affect the company's business costs andprofits Distribution needs to follow the experts' assessment to be of secondaryimportance to exporters after prices Therefore, an enterprise that wants tosucceed in promoting exports must build and choose, perfecting the distributionsystem for products of their businesses

 Communicate and promote sales in export business

To promote exports, businesses need to make good communication andsales in business This is essential to bring the company's image and brand to theminds of consumers

However, there are many factors that influence promotion when there areinternational factors such as language, cultural, social, economic, regulatory andlegal differences but businesses need to be knowledgeable to avoid unnecessaryrisks To accomplish this task, business executives must master thecharacteristics of advertising tools, promotion, public relations, personal sales,direct marketing, etc to apply for each market to achieve the best performance.+ Advertising: It is the propaganda about products and services to attractthe attention of buyers, make the goods and services interesting and eventuallymake them potential customers of an organization dealing in such products andservices Advertising forms and means are very rich The company can use suchmeans as presentations, newspapers, radio, televisions, movies, exhibitions

can use one of those forms and means, or can combine such forms and means ofadvertising, directly dealing with customers or through an intermediary, acelebrity to advertise

+ International fair and exhibition activities: Uneven economicdevelopment among countries is inevitable The exchange of goods betweencountries is an indispensable condition To expand the business and productiondevelopment arena, countries have organized exhibitions to display and advertisetheir goods on a large scale At the same time, this is also a gathering place,meeting with businessmen to negotiate and sign contracts

+ Sending a gift: A very small part of export goods is used as a gift for theadvertising object or agency to sell their goods Attached to these items may beexplanatory notes, introduction to the item In recent years, developed countries

have applied these forms very much This can quickly get the sentiment of the advertised person to stimulate or quickly cause his habit of using goods.

+ Through long-term old customers (not only in their business fields) toadvertise and introduce their export products to other customers This method hasboth saved costs for the company and brought about high efficiency

 Promote the application of market information technology and organize international information activities

Today, the information technology revolution has developed at a highlevel and spread throughout the globe It creates the ability to quickly collectinformation about economic and commercial activities Businesses need to useappropriate electronic tools to conduct business between two or more companies

It facilitates customers anywhere in the world to have a chance to look at dealsand deals wherever they want

Today, the information technology revolution has developed at a highlevel and spread throughout the globe It creates the ability to quickly collectinformation about economic and commercial activities Businesses need to useappropriate electronic tools to conduct business between two or more companies

It facilitates customers anywhere in the world to have a chance to look at dealsand deals wherever they want

 Improve product quality to promote exports

Export enterprises that want to promote exports must focus on improvingproduct quality in order to compete with products of countries around the world

In order to improve the quality of products to suit the needs of importingcountries, enterprises need to base on research information from that market,then establish required product improvements to meet response to marketdemand

Improve product quality associated with the technological development ofbusinesses and especially with cost factors Improving product quality withminimum cost is a measure that every business wants but to implement it,businesses need to weigh a lot of problems and have effective solutions.Currently, the direction for export enterprises is to apply the internationalstandard system to confirm their product quality and control production costs,then give reasonable prices for products to meet the high demand of consumers

1.3 Lessons from other countries

a) China

On the external front, the factors combined to give rise to China'ssuccess: adoption of an aggressive pro-export strategy by central authorities,active participation of local authorities and the presence of Hong Kong andTaiwanese investors looking for a source of cheap labor With the beginning ofthe open-door policy, the central authorities began sending clear signals in favor

of an export-oriented trade regime A variety of instruments were employed topromote what may be called an "export culture": geographical targeting, sectoraltargeting, a liberal foreign investment regime, and liberal provision of exportfinancing

China set up the so-called Special Economic Zones (SEZs) and OpenCities within which economic activities manufacturing, banking, exporting andimporting, and foreign investment took place in a more liberal environment that

is available in the rest of the economy The SEZs offers many economicincentives to investors not available in the inland provinces The corporateincome tax, normally 33 percent for foreign-funded enterprises and 55 percentfor state-owned enterprises, is 15 percent for all enterprises in the SEZs Dutyexemptions for assembly type operations combined with rapid processing of

imported inputs and materials by customs authorities made a significantcontribution to China's export growth.

b) Philippines

Handicraft products have been an export winner for the Philippinesbecause of the comparative advantages it enjoys in terms of: the artistry andcreativity of Filipinos, the availability of a large pool of well educated, skilllfuland highly trainable workers in the countryside; a vibrant, cohesive andarticulate national association of handicraft producers and traders, and theexistence of Filipino-owned export trading companies that have spurredexpanded production by small, widely scattered handicraft producers It is notunusual for companies to send their designers and artists to Europe and the USjust to check out the latest trends in design The Product Development andDesign Center of the Philippines (PDDCP), a technical agency of theDepartment of Trade and Industry, was organised to help companies come upwith new designs It provides invaluable assistance in product research anddevelopment, design education, design promotion, package design and designresource and technical formation

A lot of credit for the success of Philippine handicraft exports goes tothe Center for International Trade Expositions and Missions (CITEM), the maingovernment marketing arm for these products CITEM has not only exposedPhilippine handicrafts to the global market through locally held fairs andpermanent showrooms, it has also assisted several exporters in joininginternational fairs and exhibitions, the most prominent of which is the Ambiente

in Frankfurt, Germany Locally, CITEM holds fairs three times a year Thesefairs are called the Manila Furnishing Apparel Manufacturing Exchange(FAME) Week and they are held in February, April and October So far, results

of the local fairs have proved to be encouraging These results are not bad at all

considering that the government spends less than US$300,000 to prepare thesefairs For each local fair, CITEM coordinates with the commercial attachés at thePhilippine embassies in the target countries to send invitations to potential aswell as past importers of Philippine goods According to CITEM officials, theyusually try to select as diverse a group of firms as possible to participate inforeign trade fairs.

The government has developed a Preshipment Export Financing Guarantee(PEFG) Programme which provides guarantees to banks lending to small andmedium-sized exporters The PEFG is administered by the Philippine Export andForeign Loan Guarantee Corporation (PHILGUARANTEE) The DevelopmentBank of the Philippines also has a financing package offered to SME'S.However, the common problem with all of these lending schemes is thevoluminous paper work required and the various technicalities involved for aloan application

c) Lessons for Vietnam

Therefore, Viet Nam could learn valuable experiences and lessonsfrom China In particularly, Vietnam should adopt the central government'sexport advocacy strategy, active participation by local authorities Artisans, craftvillages that produce handicrafts should be paid attention to and paid attention toincome so that people can stick to the profession and maintain the nationalculture for a long time Vietnam can send artisans to European countries, checkthe trends and preferences of importing countries to improve products according

to the latest trends The Government of Vietnam invests heavily in handicraftexhibitions, which is a very effective form of advertising Vietnamese products tothe world The state needs to have more handicraft groups to support companiesand artisans Government of Vietnam can encourage the establishment ofbusinesses that export handicrafts State-owned banks can raise funds and

support packages for handicraft enterprises, artisans and villages withpreferential prices Teaching and training of artisans to create these productsshould be focused, using human resources effectively, with many policies andadvantages, for those who are third-class artists such as being sent Foreign tomarket research, have attractive salary

CHAPTER 2: EXPORT ACTIVITIES OF THUY ANH CO.,LTD

2.1 Overview of the company

2.1.1 History and development of Thuy Anh

Thuy Anh Co., Ltd was established on September 26, 2015 with a tax code

of 0108001094

 Full name in Vietnamese: Thuy Anh Co., Ltd.

 Transaction name: Thuy Anh CO.,LTD

 Charter capital: 25.000.000.000 VND

 Legal representative: LƯU THỊ NGỌC THUỶ

 Address: Hoàng Đạo Thúy street- Cầu Giấy district- Hà Nội city

The company has just been established in a short time, but the companyteam consists of a lot of highly qualified personnel, has a lot of experience in thefield of goods export, especially in the field of crafts exports, crafts In addition,the company's products are carried out under strict procedures in the hands ofskilled craftsmen, which has brought great success to the company over theyears Handicrafts are not only decorative items, they also contain culture, andsouls of producers Therefore, with sources from famous skilled workers such asChang Son, Bat Trang, Nga Son, are the items that have affirmed their position

in the country and increasingly affirmed their influence on the world market ,

the company has a strong position, compared to the leading handicraft exportcompanies in Vietnam.

By creating good relationships with customers in the international market,the company always has the support of customers, facilitating the capital of thecompany quickly turn around, finding new customers, happening quickly Sincethen, the company has created an extensive customer network for companiesworldwide Founded in 2015, initially, the company met many difficulties andchallenges, but the company has made great efforts to assert its position in theexport market of handicrafts At the present time, the company is planning toexpand its exports as well as seeking new markets around the world to carry outits exports

2.1.2 Business field

Thuy Anh Co., Ltd is a company specializing in exporting handicraftproducts to foreign markets such as the United States, EU and Japan Handicraftproducts that the company exported such as bamboo, rattan, ceramics, Lacquer Besides, the company also provides transportation and warehousing servicessuch as:

 Freight transport Road transport of passengers in urban and suburban areas(except for transportation by bus)

 Transporting goods by road/ by sea

 Transporting inland waterways

 Warehousing and storage of goods

 Direct support services for water transport

 Loading and unloading goods

 Other support services related to transport

 Export handicrafts

2.1.3 Organizational structure of the company

In the beginning, the company only consisted of 10 members But up tonow, with good development, the company's personnel system has reached 40people Here is the structure diagram of the organization of Thuy Anh Limited

MANAGER

DEPUTY DIRECTOR

Diagram2.1: Organization structure chart of Thuy Anh Co., Ltd.

Thuy Anh Co., Ltd operates with the leading organizational structure ofthe company as the director The director is responsible for running the companyand is responsible in all areas:

 Planning and developing a general plan for the company's strategy

for the effectiveness of the assigned tasks The Deputy Director has its ownfunction of recruiting personnel for the company.

The organization company 4 function rooms are the finance-accountingdepartment; Business Department; Import and export department and HRdepartment The duties and functions of each room are shown as follows:

d) Accounting Department

The function of this department is to carry out the accounting of thebusiness process for the company, to assist the Director in managing activities,economic calculations, using assets, materials and capital to ensure the rightsproactive in production and business and financial initiative in the company Inaddition, the department should check the implementation of the State policies,regulations on the field of accounting and finance, making reports and financialplans

f) Export Department

Export Department carries out international trade transactions, import andexport operations; expand markets, promote activities of buying and sellinggoods Not only that, the department is responsible for delivering goods topartners, handling cargo from the company's warehouse to the port The staff ofthe import and export department must meet the high requirements of theprofessional level of import and export, foreign language ability and otheroperations related to import and export work

g) Human resources Department

Human resources department is responsible for recruiting personnel forthe company and training new personnel, connecting members of the companytogether The HR department encourages employees in the organization to worktogether to help them reach their full potential while providing suggestions foremployees to improve work efficiency The HR department is also responsiblefor communicating with employees to provide them with the necessary feedback

on job performance Social activities also bring a lot of effects in stimulating thework of company personnel

2.1.4 Target in the future

Our strategy for 2020 includes all dimensions of acting sustainably andsuccessfully By challenging the status quo in the logistics industry, Thuy Anhstrive toward economic, social, and environmental harmony in logistics andsupply chain management

By 2020, Thuy Anh will be profitable quality leader and hold top positions

in company’s target markets Building on the long-term financial stability, thecompany will continue to invest in growth markets, new business, and the

expertise of our employees Schenker will deliver innovative products, based onhigh performing processes and cutting-edge IT systems In doing so, company’scustomers remain completely satisfied with company’s leading networks andindustry solutions.

By 2020, Thuy Anh will be the top employer in logistic industry Thecompany is a diverse and international, inspiring and attracting people of all agesand professions The company support the development of employees and offerthem local and international career opportunities Thuy Anh relationships arebased on mutual trust and the common leadership philosophy The companyoffers a working environment that respects individual needs and values

everyone’s contribution

By 2020, Thuy Anh will be the eco-pioneer of our industry The greenproduct portfolio and expertise in eco-consulting are at the heart of oursustainable strategy These features deliver a clear competitive advantage forcustomers and for company Thuy Anh will be considered the benchmark interms of carbon and energy efficiency The company is also striving to reduceother emissions, such as noise, in order to increase society’s acceptance of ourfuture growth

2.2 Exporting Procedure

To ensure that export activities are carried out safely and smoothly, thecompany proceeds with the following stages of the general export process In amulti-step process that is closely related, the previous step is the basis andpremise to take the next step Usually, a commodity export process consists ofseveral steps:

Research (Market, partners, competitors…)

Step 1:

Preparation

Step 2:

Implementation

Identify business items

Detail business plan (business methods, goals, effect…)

Negotiate and sign contracts

Implementation of contracts (products, insurance,transportation…)

Customs clearanceShipping

Payment procedure

Step 3:

Evaluation

Complaints or complaints settlement

Results and lessons

Diagram2.2: Export process of Thuy Anh Co.,Ltd

Step 1: Preparation

1 Market research, search for partners

Foreign markets include many complex factors, different from the domesticmarket Therefore, it is necessary to master the market factors and understand therules of movement of foreign markets Market research has importantimplications in developing and improving economic efficiency

Market research must answer some of the following questions: what to export,which market, who the trader is, which way of trading, business strategy for eachstage to achieve the goal suggests.

For companies, market research is extremely important In the study, thecompany had to master a number of contents such as general political,commercial, legal and trade policies, conditions for money and credit,transportation conditions and price situation In addition, the company also needs

to master some content related to business items in that market such as marketcapacity, customs and consumer tastes of people, price fluctuation, the level ofcompetition of that item

Moreover, in order to be able to export goods during the study of foreignmarkets, the company has to find customers Selecting traders should be based

on some of the following characteristics: your reputation in the market, time ofbusiness operation, financial ability, technical facilities, distribution network,products so, the company can export goods and avoid risks in internationalbusiness

1 Identify business items

The identification of business goods must first be based on the needs ofproduction and consumption in terms of specifications, sizes, prices, seasons andtastes as well as consumer habits of each region and each domain manufacturing.Since then, the company reviewed aspects of goods in the world market Themost important issue in this period is to determine the export volume and thetime of export to sell at a high price in order to achieve the maximum profit

2 Prepare a detail business plan

Based on the results obtained during the study of market access abroad, thecompany set up a business plan This plan is the unit's operation plan to achieve

the defined objectives in the business The construction of a business plan

includes the following steps:

 Evaluate the market situation and traders

The company must provide an overview of the foreign market and adetailed assessment of each market segment At the same time, it must also givespecific comments about foreign traders that the unit will cooperate with

 Selecting items, business methods

From the product line, the company must select the export product that thecompany has long-term potential, has a stable source of goods to meet theappropriate export opportunity: suitable time, amount, restock,… for exporting depending on the ability of the company, the company chooses appropriatebusiness methods

On the basis of an assessment of the foreign market, the ability to consumesuch export products that the export business unit sets a target for each specificperiod

Stage 1: Sell products at low prices to compete with similar products, enablingconsumers to have a chance to try and gain market share

Stage 2: Gradually raise the selling price to earn profits At the same time, thecompany continues to improve product quality, diversified models, saleschannels and attractive incentives for agents

 Propose measures to implement

Implementation solution is a tool to help business companies implementthe objectives set out in the most effective, fastest, most profitable way forbusiness companies

 Evaluate the effectiveness of the business.

This is an activity that helps the company evaluate business performanceafter business contracts At the same time, the effectiveness of the stages oftrading companies has been well done and the periods are still weak Since then,the company has completed the export process effectively

In this step, the director and deputy director of the company directly directthe search for potential markets that have import support policies In particular,these are extremely interesting markets for handicraft goods shown In addition,the sales department will assist in finding customers for the company

In order to negotiate well, the company must prepare the market,economic, cultural, political, legal information of countries, or information aboutpartners such as development, reputation, as well as the potential financial ability

of the enemy Requiring professional staffs who need to know information aboutgoods, markets, customers, politics and society accurately and quickly willhelp negotiate the signing of contracts effectively

Currently, trade negotiations often use three basic forms of negotiation:mail negotiation, telephone negotiation, negotiation by the direct meeting But inVietnam today, the two forms of negotiation through correspondence andtelephone negotiation are most commonly used.

 Sign a contract

Whether the contract is carried out depends on the terms that the twoparties have committed in the contract When signing an economic contract, itmust be based on conditions such as planning orientations and economicdevelopment policies of the state, market demands, orders and sales leads

In this step, the sales department is responsible for self-advertising to findcustomers, then negotiate and advise customers to sign contracts The businessdepartment consists of 12 employees, which is an important part of the companythat makes a lot of profit and maintains the company's growth

2 Implementation of export contracts

After signing an export contract, the enterprise needs to organize acontract that has been signed Based on the terms stated in the contract, theenterprise must arrange the tasks into a table to monitor the progress of contractperformance, promptly grasp the situation of sent documents and receiveinformation feedback from partners

 Prepare export products

Foreign trade is usually conducted on a large number basis Packaging forhandicrafts should be carefully organized and marked with the correct number.The organization of packaging, packaging, and coding is an important step in theprocess of preparing goods because the goods are packed in the process oftransport and storage If you want to do a good job in packaging, you need tounderstand the requirements of the type of packaging to suit and in accordance

with the regulations in the contract, and at the same time have high economic efficiency:

- Type of packaging: often used as boxes, barrels

- Symbol code: Symbol code with numbers or letters or drawings written onthe outside of the package to inform necessary information for delivery, handling,and storage

 Quality inspection of goods

Before delivery, the exporter must be obliged to inspect the goods interms of quality, weight, packaging this is a necessary job that helps thecustomer benefits to be ensured, avoiding risks, and assigning responsibilities ofthe steps in production as well as creating a source to ensure credibility forexporters and manufacturers in trade relations The inspection of export goodsshall be carried out immediately after the goods prepared for export packing atthe border-gate inspection establishments, which are directly inspected bycustomers or inspected by competent agencies, shall be subject to agreement ofboth sides

 Buy insurance for goods

Transportation of export goods often presents risks and losses, so thepurchase of insurance for export goods is the best way to ensure the safety ofexported goods during transportation

 Renting transportation

In the process of implementing a contract for export of goods, the hiring

of a means of transport is based on the contract: the condition of the quantity orquantity of the delivery facility is based on the characteristics of exported goodssuch as weight, size, material goods

The compilation and execution of contracts, is handled by sales staff Thebusiness staff combined with the accounting department (including 3 people) andthe export department (including 5 people) The accounting department isresponsible for receiving money, spending on orders, making documents tocirculate cash flow to the company, keeping financial resources transparent Inaddition, the sales staff also combined with the export department to choose themode of transport, insurance and agreements in the contract.

3 Customs clearance

This is a mandatory rule for any kind of goods, this work is conducted through 3steps:

- Customs declaration: the company is responsible for declaring full details

of the goods honestly and accurately on a declaration form for the inspectionagency Contents include a type of goods, goods name, the quantity, the value ofgoods, means of goods, import country Customs declarations are presented alongwith a number of other papers such as export contracts, permits packing invoice

- Presentation of goods: export goods must be arranged in a convenient wayfor control

- Implementing customs decisions: this is the last job in the process of completing customs procedures

The company fulfills the conditions of delivery of goods in exportcontracts, in time of delivery, enterprises must carry out delivery procedures,currently, most of our exported goods are transported by sea and rail

 If export goods are delivered by sea, the company does the following:

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- According to the details of export goods, set up a register for the transport of goods for the transporter in exchange for the queue.

- Change with the port's dispatching agency to know the date of arrival and departure of the vessel

- After loading the ship, receiving the mate's receipt and changing the receipt

of the mate's bill of lading with the function of shipping certificate, transportcontract

- The certificate of ownership of the goods, the bill of lading is a bill of lading which is transferable

- Also can include a clean bill of lading: full certification, packaging status, quality, perfect quantity of goods, making it possible to transfer goods

 If the goods are spearheaded by Containers

- When they occupy a full container (FCI), the exporter signs a container,closes the container into a container, makes a list of goods in the container whenthe goods do not occupy one container (LCL) a "Register for transportation" Afterregistration is accepted, the shipper delivers the goods to the Container Station forthe carrier

 If the goods transported by rail

- The exporter must register with the railway agency to apply for carriagessuitable to the nature of the goods and the volume of goods After loading andunloading goods, the goods owner seals the clamps lead and make transportdocuments, receive railway bill of lading

 Make payment procedures

Payment is an important step and the final result of all transactions in theexport business Currently, the following two methods are widely used

 Payment by letter of credit (L / C)