Comparative Analysis of South Korea and Vietnam for Dairy Industry

Running head: STRATEGIC BUSINESS MANAGEMENT
STRATEGIC BUSINESS MANAGEMENT
Name of the student
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Table of Contents
Task1................................................................................................................................................2
Task 2...............................................................................................................................................7
Critical evaluation of the comparative data.................................................................................7
Political....................................................................................................................................8
Economic.................................................................................................................................9
Social.....................................................................................................................................11
Technological........................................................................................................................12
Environmental........................................................................................................................13
Legal......................................................................................................................................14
Recommendations for expanding in a market.......................................................................15
Task 3.............................................................................................................................................16
References......................................................................................................................................18

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Task1
Macro environment
factors
South Korea Vietnam
Political a) There is high military
influence in the politics
of South Korea
(Hoadley, 2017).
b) Centralisation of the
authority has resulted the
process of policy making
straight forward.
c) South Korea has a very
strong and significant
foreign relationships.
d) Dairy industry is one of
the most profitable
sectors in South Korea.
a) Socialist Republic of
Vietnam is one among the
five remaining single-
communist party states in
the world
b) The communist party of
Vietnam keeps the
political environment of
the country stable since
the occurrence of few
riots (Kerkvliet, 2018).
One of the most notable
was of the anti-China
protest
c) The human rights of
Vietnam deteriorates
notably and is one of the
most significant issue in
the nation.
d) Government of Vietnam
strictly controls and
censors the press.
e) Corruption and
Bureaucracy is remains at
the highest level. As per
the Corruption Perception
Index raking of the year
2014, the Vietnam ranked
119th in 175 nations
(Sircar& Lee, 2017).
Economical a) South Korea have a very
powerful export sector
and some really
successful economic
reforms. The current
GDP of South Korea per
capita as per the year
2017 was 29,750$
(Aspalter, 2017).
a) Vietnam’s GDP (nominal)
per capita as per the year
2017 was 2,342$. It falls
under the lower-middle
income group.
b) High potential dairy
market.
c) It is considered to be one
of the most dynamic

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b) High potential dairy
market.
c) There is low level of
imports in South Korea.
All the import tariffs,
restrictions and the duties
are highly regulated and
at the same time, the
import volume of the
country is comparatively
lower than the other
ones.
d) The inflation rate of
South Korea as per 2013
was 1.3% and that of the
interest in the year 2015
was 1.50% (Lee, 2016).
e) The rate of
unemployment in South
Korea in 2017 was
3.68%.
f) As per Langham and
Parry (2017), about 15%
of the total South
Koreans live below the
poverty line.
emerging nations in East
Asia.
d) Vietnam’s inflation rate as
per the year 2013 was
6.6% (Benjamin, Brandt
&McCaig, 2017).
Moreover, the rate of
exchange of the USD to
VND was 21565.
e) The interest rate of
Vietnam was 6.5% in
2015 (Nguyen, 2018).
f) In the year 2017, the rate
of unemployment in
Vietnam was 2.05%.
Hence, it is quite low.
g) About 9.8% of the total
population of Vietnam
still lives in excessive
poverty as of the data of
2013 (Phung et al., 2016).
Social a) The total production of
raw milk in South Korea
in the year 2016 was
KRW 2.2 trillion (Lee,
2016). This accounts for
3.6% of the entire GDP
of the agricultural sector.
b) Dairy processing
industry of South Korea
is considered to be the 3rd
largest food processing
industries in the region,
right after the liquor
industry and wheat
processing industry.
c) The average per capita
volume of milk
consumption has been
continued to increase to
76.4 kg as per the data of
a) Vietnam has ample of
labour force. As per the
year 2013, the total
number of people working
was 53,748 million.
b) Increase in demand for
fresh milk.
c) The percentage of the
malnourished children in
Vietnam is high.
d) The level of education in
Vietnam is moderate.
People know the benefit
of milk and parents are
concern about the health
of their children and buy
milk on a daily basis.
e) The consumption of milk
per capita in this nation is
quite low. It is 20litres per

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2016.
d) Butter and cheese market
has been grown and
developed remarkably
but the market of
flavoured milk has been
reduced.
e) The rate of population
growth in South Korea is
0.4% annually.
f) There is rapid
urbanisation in South
Korea. This has brought
in a massive shift of
population from the rural
areas to the urban ones.
person in a year.
However, it has been
projected to increase to
about 28litres per person
in a year.
f) Corruption, increase in
crime rates, frauds,
robbery and rapes have
resulted in decrease in
trust among the
Vietnamese.
g) The rate of population
growth in this country is
just 0.97% as per the year
2017 (Nguyen-Viet &
Imai, 2018). Its population
is equal to about 1.26% of
the population of the
entire world.
h) Only 33% of the total
population resides in the
urban areas. Majority
lives in rural sides and
they have very limited
technology related
facility.
i) The GDP per capita
increased every year from
700USD in the year 2005
to 1479USD in 2012
(Dang, 2016). The income
of the Vietnamese have
been increased with an
understanding of the
advantages of the milk.
This is making the
consumption of milk
demand higher.
Technological a) South Korea has the
highest rate of broadband
internet subscription in
the world.
b) The rate of mobile phone
penetration is also the
highest, i.e., of 68%
(Shin &Koh, 2017).
i) In the year 2012, there
were a total of 69, 80,353
number of laptops and
computers were there in
the Vietnamese
households. It was an
increase of 2.6% from the
year 2011.

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c) There are both large
domestic and
international players
present within the dairy
industry in South Korea.
d) In the year 2014, there
were a total of 22.1
million of active mobile
users who use internet in
South Korea. Also, in
2018, it reached to 28.1
million.
e) 73% of the total mobile
using population of
South Korea use internet
to make purchases.
f) The government of South
Korea have formulated
many favourable policies
for encouraging the
international companies
to locate their research in
the nation. It has
employed several
policies for attracting the
R&D centres of the
cutting edge corporations
like the Novartis, HP,
Microsoft, University of
Warwick, IBM and Intel.
g) In the year 200, the
South Korean
government have also
implemented “Free
Economic Zones Act” for
improving its business
environment.
h) The government have
also introduced the
milking robots in the
year 2006 for the
farmers.
j) The total number of
mobile users in the year
2013 in Vietnam was 12,
37,35,557 (Lai & Nguyen,
2017). It was about 138%
of the total population of
the country.
k) Vietnam has been ranked
18th in the whole world for
the total number of
internet users present in
the country.
l) 20% of the internet users
in Vietnam use online
shopping sites to make
purchases.
m) Information Technology
in this nation is
developing in rapid way
and is also actively
supported by the
Vietnamese government.
n) The government have
recently approved the
project- “Improvement of
computer usage and
public Internet access
ability in Vietnam”.
Legal a) The government of South
Korea offer several
regulatory incentives for
the attracting the
a) The legal environment of
Vietnam is very
complicated.
b) According to Grafton et