business environment in Vietnam PDF

Table Of Contents
INTRODUCTION....................................................................................................................2
PART A: BACKGROUND DETAILS...................................................................................3
I. Vinatex Danang JSC...........................................................................................................3
1, Historical Story..............................................................................................................3
2, Today..............................................................................................................................3
3, Overview........................................................................................................................3
4, Strategic Statement.........................................................................................................5
II. Vinamilk JCP.....................................................................................................................6
1, Historical Story..............................................................................................................6
2, Today..............................................................................................................................6
3, Overview........................................................................................................................7
4, Strategic Statement.........................................................................................................8
III. Phu Nhuan Jewelry JSC...................................................................................................9
1, Historical Story..............................................................................................................9
2, Today..............................................................................................................................9
3, Overview.....................................................................................................................10
4, Strategic Statement.......................................................................................................11
IV, Comparison....................................................................................................................12
PART B: ASSESSMENT......................................................................................................14
I, Organisation Chart and Value Chain................................................................................14
1. Vinatex Da Nang..........................................................................................................14
2. Vinamilk.......................................................................................................................16
II, Comparison and SWOT Analysis...................................................................................18
1, Comparison:.................................................................................................................18
2, SWOT Analysis...........................................................................................................18
III. Evaluation and Critical Review.....................................................................................19
CONCLUSION:.....................................................................................................................20
REFERENCE LIST:..............................................................................................................21
1

INTRODUCTION
In the present age society, business activities take place extremely exciting in the Vietnamese
market in particular and the world in general. According to the General Statistics Office,
Vietnam had set a record when there were 131.1 thousand businesses established in 2018.
Besides, more than 12.5 thousand businesses in Vietnam go bankrupt every year. Therefore,
before starting a business, it is advisable to understand the business environment and the
structure of many different types of organizations. The business environment is defined as the
influencing factors that are closely related to business activities. These factors have internal
or external effects on the company's results, performance, and growth. Therefore, BE is the
key to achieve great success.
As an assistant business analyst by Vinatex Da Nang Joint Stock Company, I take on the task
of writing the report to the CEO about investigating and explaining three different types of
organizations including: Vinatex DaNang JSC, Vinamilk JSC, and PNJ JSC.
This article will describe an introduction to each of 3 companies above; give clear
information and explain them; evaluate the different business functions for Vinatex Da Nang
JSC and analyze the advantages and disadvantages to how they relate to and impact the
structure of the company. The Final is the conclusion and reference list.
2

PART A: BACKGROUND DETAILS.
I. Vinatex Danang JSC.
1, Historical Story.
In 1992, Vinatex Da Nang was a member of Vinatex and Vitas. In 1995, it merged into
Textile and Garment. In 2002, it merged into VN National Textile Garment Corporation at
DaNang and Thanh Son textile garment. Until 2005, it was called Vinatex Danang. Then, it
renamed Vitatex DaNang Joint Stock Company on the first of July, 2008. Headquarters was
located 25 Tran Quy Cap, Thach Lang, Hai Chau, Da Nang city, Vietnam.
2, Today.
Nowadays, it has grown strongly with 4 factories with more than 4000 employees and 3500
machines, 2 joint venture companies, and many other partners such as: Motives group, Lanier
clothes, Perry Ellis International, and Vinatex. group. They are known as a company
specializing in manufacturing and trading and exporting products such as trousers, jackets,
protection wear, and clothing to the US, German, Korea, Taiwan, and Japan. Net sales
reached 705.6 billion Vietnam dong in 2019.
Unit: Million
Dong
(Source:https://finance.vietstock.vn/VDN-ctcp-vinatex-da-
nang.htm)
3

3, Overview.
Company Vinatex Da Nang JSC.
Legal Form Joint Stock Company
Ownership (Private Sector or Public Sector) Private Sector
Profit or Not for Profit Profit
Size Large enterprise
Business Activity (s) Manufacture and exporter
Industry Garment and textiles
Wire or narrow Wide
Country of Headquarters Vietnam
* Stakeholders:
Mr. Pham Phu Cuong is the chairman of the board of directors. He is the most powerful
man in the company.
Mr. Ho Hai is the chief executive officer. He is in charge of the operating company.
4, Strategic Statement.
4
These people have a direct influence on the vision and future strategy of
the whole company.

5
To become the
representative textile brand
of Vietnam. Vision
Bring fashion
to everyone Mission
Account for
30% market
share in
DaNang
goal
Achieve
sales of
1000
billion
Vietnam
Dong in
2021
objecive

II. Vinamilk JCP.
1, Historical Story.
Vinamilk was established on August 20, 1976, on the basis of three dairy factories from the
old regime as: Thong Nhat Dairy Factory, Truong Tho Dairy Factory, Dielac Powdered Milk
Factory. In 1995, Vinamilk Inaugurated the first dairy factory in Hanoi. After that, a series of
factories in Can Tho, Binh Dinh, and Nghe An were put into operation. In 2006, Vinamilk
inaugurated the first dairy farm in Tuyen Quang. Headquater was located in 10 Tan Trao,
District 7, Ho Chi Minh City, Vietnam.
2, Today.
Currently, the total herd of cows supplying milk to the company is more than 120,000 cows,
providing about 750 tons of raw fresh milk to produce over 3,000,000 (3 million) glasses of
milk/day. According to the Vietnam Report, in 2018, the liquid milk segment of Vietnam
Dairy Products Joint Stock Company (Vinamilk - code: VNM) continued to lead the industry
with about 55% market share. Besides, Vinamilk holds more than 80% market share of
yogurt, more than 80% of condensed milk market share, and more than 30% market share in
powdered milk. Net sales achieved 15.5 trillion in Quarter 2/2020.
Unit: Million Dong
(Source:https://finance.vietstock.vn/VNM-ctcp-sua-viet-nam.htm)
6

3, Overview.
Company Vinamilk
Legal Form Joint Stock Company
Ownership (Private Sector or Public Sector) Private Sector
Profit or Not for Profit Profit
Size Large enterprise
Business Activity (s) Manufacture and exporter
Industry Garment and textiles
Wire or narrow Wide
Country of Headquarters Vietnam
* Stakeholders:
Mr. Phan Minh Tien is the chief marketing officer. He will have a duty to do a market
analysis to come up with the current situation of the market.
Ms. Bui Thi Huong is the chief human resource officer. She will be responsible for
managing human resources and making reward policies suitable for employees.
7

4, Strategic Statement.
8
To become a world
grade brand in food
and beverage
industry, where
people put all their
trust in nutrient and
health products.
Vision
To deliver the
valuable nutrition to
community with
our respect, love
and responsibility
Mission
- Maintaining the
No.1 position in
Vietnam market.
- Aiming to reach
the Top 30 of
World’s Largest
Dairy Companies
in terms of
revenue.
Goals
- Marketing products
-Research Environment
- Developing plans Objectives
These people have a direct influence on the vision and future strategy of
the whole company.

III. Phu Nhuan Jewelry JSC.
1, Historical Story.
April 28, 1988, Phu Nhuan Jewelry Shop was born with 20 employees. In 1992, the company
changed its name to Phu Nhuan Jewelry Company. In March 2009, PNJ shares were
officially listed on the HOSE, charter capital increased to 400 billion VND. In 2010, PNJ was
ranked 16th by Plimsoll in the top 500 largest jewelry companies in the world. Headquater is
located in 170 E Phan Dang Luu, Ward 3, Phu Nhuan District, Ho Chi Minh City, Vietnam.
2, Today.
After years of efforts, on April 28, 2018, the PNJ established two subsidiaries with charter
capital up to 120 billion VND. It has 350 stores all over the country with high aesthetic value
jewelry. Net sales got 3.9 trillion in Quarter 3/2020.
Unit: Million Dong
(Source:https://finance.vietstock.vn/PNJ-ctcp-vang-bac-da-quy-phu-nhuan.htm)
9

3, Overview.
Company Phu Nhuan Jewelry Joint Stock Company
Legal Form Joint Stock Company
Ownership (Private Sector or Public Sector) Private Sector
Profit or Not for Profit Profit
Size Large enterprise
Business Activity (s) manufacture
Industry Jewelry business
Wire or narrow Wide
Country of Headquarters Vietnam
* Stakeholders:
Ms. Cao Thi Ngoc Dung holds the position of Chairwoman of the Board of Directors. He
got an Economic bachelor's degree and have excellent economic knowledge.
Mr. Le Tri Thong is the CEO. He manages and promote the company's development.
10
These people have a direct influence on the vision and future strategy of
the whole company.

4, Strategic Statement.
11
Being Asia's leading
jewelry retailer and
manipulator Vision
bring luxury to
customers Mission
No. 1 jewelry
brand in Vietnam Goal
Account for
20% market
share nationwide Obejctive

IV, Comparison.
Aspects Vinatex Da Nang Vinamilk Phu Nhuan Jewelry
Legal Form Joint Stock Company
Size Large enterprise
Organizational Scope Wide
Product trousers, jackets,
protection wear.
milk, yogurt, sugar,
ice-cream
Jewelry
Service Refund Multiple separate
service
Customer care
Price Affordable Reasonable Luxury
Goals and Objectives SMART
Desire Maximize profits and reduce costs.
Legal Form.
Known joint-stock companies have large benefits, so a great number of companies have
chosen their own joint-stock companies for long-term development. First, the Joint Stock
Company has more chance to raise huge capital than other types of business. If the company
needs money it can sell its shares to the public. Furthermore, shareholder liability is also
limited by the number of shares they hold. That means they won't lose their home or car if the
company goes bankrupt. Instead, they can easily sell and transfer shares.
Size and Scope.
All three companies above have very large employees with many branches in the countries
and are classified as a large enterprise (more than 250 employees). Vinatex Da Nang, Phu
Nhuan Jewelry, and Vinamilk have more than 4000, 5700, and 10 000 workers respectively.
Besides, the organizational scope of all 3 companies is wide. They have customers of all
ages, genders, and interests. Besides, they have many headquarters located in many countries
and business is also very large. Vinamilk will be an example to demonstrate this. Vinamilk
has more than 10,000 employees, supplying and distributing to 30 different countries, and
have 18 million products consumed daily from all ages. According to statistics, 100% of
Vietnamese people have used Vinamilk's products.
12

Product, Service and Price.
Each company has its product since the service and cost will be different. As far as Vinatex
Da Nang has been shown that company specializes in supplying pants for 70 USD while
Vinamilk’s Pasteurized Milk (220ml) has only 6,000 VND, but Vinatex DaNang will
guarantee that they can exchange and refund if there is an error within 15 days.
Goals and Objetives.
Must be combined together in a SMART to maximize productivity.
Specific : Plans must be clear and understood in the same way.
SMART stands for:
Measurable: Monitor each step of The Strategic Statement.
Achievable : Actions to achieve the goal.
Realistic : Focus on the end results.
Time-bound: Determine the time period.
Desire.
Although the three organizations mentioned above have many differences in products, prices
and services or even structures and departments. They all share the same desire for increasing
the profitability of the organization, this is the main point that every organization wants to
achieve.
13

PART B: ASSESSMENT.
I, Organisation Chart and Value Chain.
1. Vinatex Da Nang.
14
GENERAL MEETING OF SHAREHOLDERS
Functional Organisation
Structure.
BOARD OF MANAGEMENT
CEO
Human
Resources
Department
Accounting
Department
Garment
Sales
Department
Garment
Import And
Export
Department
Garment
Quality
Control
Department
Garment –
Technical
Department
(*) Keywords:
 Accounting Department: responsible for preparing the financial statements,
paying bills and tax, billing customers, payroll, cost accounting, financial
analysis, and more.
 Human Resources Department: manage human resources, and keep the
balance of the workforce to avoid surplus or shortage employees.
 Garment Import And Export Department: receive materials and distribute
products.
 Garment Quality Control Department: evaluate and feedback products.
 Garment – Technical Department: design and improve products.
 Garment Sales Departments: promote the client's purchase of a product or
the customers engagement of a service.

Analyse how the structure, size and scope of Vinatex Da Nang
JSC links to the business objectives and product and services offered by
the organization.
As mentioned above and through the given functional organization structure, we already
know that Vinatex Da Nang has just over 4000 employees, the structure of Vinatex Da Nang
is quite simple with 6 departments, the lead will be the CEO. People think that 6 departments
taking on separate functions, it seems that it will not be related to each other. But in reality,
the 6 departments are closely related and interdependent. The Value Chain below will
Analyze how the structure, size, and scope of Vinatex Da Nang JCP link to the business
Objectives and products and services offered by the organization. A book called ''Competitive
Advantage'' by Michael Porter in 1985, which defined The Value Chain that was related to
things a company did to boost value to the goods and services it provided.
15
Case Study – Vinatex Danang JSC
Margin
Margin
Support
Activities
Primary Activities
INFRASTRUCTURE: Rooms with lights, chairs, desks and some supporting tools.
HRM : All workers is trained in the textile line technique.
Technology Development: Company has wifi system.
Procurement: Vinatex Da Nang signs a contract to buy fabric from China.
Inbound
Logistic:
Get fabric
from china
supplier.
Operation:
Sewing and
weaving
fabrics into
trousers
Outbound
Logistics:
Provide
trousers to the
person who
signed the
contract or
distribute it to
the retailers.
Marketing
And Sales:
Search for
businesses by
themselves and
then provide
contracts for
selling
products.
Service:
Company
redesigns the
product if it is
not satisfactory
and no charge.
The given value chain demonstrates that decision made in 1 value activity may affect other value
activities. For example, Procurement Department in Vinatex Da Nang JSC bought 150.000 VND/ 1 kg
fabric, so the trousers price is 70 dollars. But if the price received from the supplier is lower than
150.000/ 1 kg, the product will receive a discount. When the cost of the product is cheaper and the
quality and service are still good, it will attract more customers. These things will help the company's
revenue grow well and the company easily meets business objectives.

2. Vinamilk.
16
Functional Organisation Structure.
BOARD OF MANAGEMENT
CEO
GENERAL MEETING OF SHAREHOLDERS
Strategic
Planning
Department
Information
Technology
Department
Directing
Production
Department
Material
Development
Department
Supply
Chain
Department
Human
Resources
Department
Marketing
Department
Inland
Business
Operations
Department
International
Business
Executive
Department
Financial
Operations
Department
Research And
Development
Department
(*) Keywords:
 Human Resources Department: manage human resources, and keep the balance of the
workforce to avoid surplus or shortage employees.
 Strategic Planning Department: development strategy.
 Information Technology Department: all activities related to IT systems.
 Inland Business Operations Department: develop and improve domestic business strategy.
 International Business Executive Department: develops international business plans.
 Marketing Department: advertise products to everyone.
 Research And Development Deparment: development strategic statement.
 Directing Production Department: lead and operate the production process.
 Material Development Department: research on high-quality materials.
 Supply Chain Department: order fulfillment from point of origin to point of consumption.
 Financial Operations Department: create financial statements.

Analyse how the structure, size and scope of Vinamilk JSC links to the business
objectives and product and services offered by the organization.
From the information stated in the introduction with the above functional structure, we know
Vinamilk has more than 10000 employees. The company has divided into 11 departments.
The Value Chain below shows departments working together to maximize product
performance and increase profitability in Vinamilk JSC.
17
Margin
Margin
Support
Activities
Primary Activities
INFRASTRUCTURE: Facilities are modern and professional, with research rooms, yoga and swimming pool.
HRM : Everyone is happy, understanding, and respecting the laws of the company.
Technology Development: Robots and Laser Guided Vehicles.
Procurement: Cows are imported from the US, Australia and New Zealand.
Inbound
Logistic:
The cows get
special care
every day.
Operation:
Get 100%
organic milk
from cows.
Outbound
Logistics:
Nationwide
and worldwide
distribution
Marketing
And Sales:
Advertise on
TV, Youtube
and in
newspapers.
Service:
The customer
service is
extremely
excellent.
The given value chain demonstrates that decision made in 1 value activity may affect other value
activities. Especially for Marketing department and human resource department, they know do research
situation by methods of SWOT analysis or PESTLE combined with 7PS (Marketing mix). Having made
great achievements and creating an extremely meaningful brand name that is "Vinamilk''. Vina stands for
Vietnam and they combine with the slogan: "Vietnamese people should prioritize using Vietnamese
goods". This trend has rocketed milk sales, helping the organization quickly reach goals.
Case Study – Vinamilk JSC

II, Comparison and SWOT Analysis.
1, Comparison:
As we have seen in the functional diagram between Vinatex Da Nang JSC and Vinamilk JSC.
Then we can see that the division structure of the two organizations is markedly different.
Specifically, Vinatex Da Nang has 6 departments while Vinamilk has 11 departments. The
departments undertake different tasks depending on the area of the company's business. But
unfortunately, Vinatex Da Nang made a big mistake creating many shortcomings that did not
have a marketing department.
Mitchell Grant defined that: "SWOT (strengths, weaknesses, opportunities, and threats)
analysis is a framework used to evaluate a company's competitive position and to develop
strategic planning". This article will use SWOT analysis to analyze the benefits and
drawbacks of interrelationships between functions and the impact that can have upon
organizational structure.
2, SWOT Analysis.
18
S W O T
Strengths Weaknesses Opportunities Threats
Vinamilk
Vinatex
Da Nang
- Strong brand
name, large
market share.
- Company has
Marketing teams.
- Key personnel
stick with the
company
- Dairy products
of international
quality.
The marketing
department was
still weak, which
led to the failure
to advertise to
consumers about
all of the
company's
strengths.
- Entering
international
market.
- Easy to
attract more
capital.
- Coronavirus
happens.
- Compete in
international
markets with Top
Largest Dairy
companies such
as: Yili, Dairy
Farmers of
America,
Fonterra, Lactalis
and Nestle.
- Company has
more than 4000
employees.
- Know how to
adapt to the market
situation. (For
example: Company
has changed
production from
clothing to masks
during the covid
season.)
- No marketing
department.
-People don't
know about the
company.
- They don't have
material supply.
Produce more
mask if the
coronavirus
comes back.
Many local and
domestic textile
companies.

According to the SWOT Analysis table above. We can see the extremely weak, which has lost
many market integration opportunities for Vinatex Da Nang, and the reason is the lack of
marketing room in functional structure. The lack of a marketing department has come to a
standstill for the company. First of all, because the employees did not advertise widely about
the products, the staff at the sales department had to find potential customers by themselves.
Secondly, the Company did not report enough information, so it will be limited in investment
because of the lack of trust from customers. As Vinatex Da Nang has said that they can not
supply raw materials so they have to import raw materials from an outside company, then
trouser should cost up to 70 dollars per pair. The above factors have a direct influence on the
increased revenue and make the goals farther.
Besides, Vinamilk has done well with its duties when it has a marketing department and many
benefit departments with large amount of money, which combined with the management of the
leaders drove the company's strong growth. However, proficiency in the marketing team is not
enough to meet the needs to introduce all of the company's strengths to everyone. This has
hindered the company's growth in international markets.
III. Evaluation and Critical Review.
From the aforementioned issues via SWOT Analysis. This is advice for 2 organizations.
Firsly, Da Nang needed to add an additional Marketing department to advertise more widely
about the company information and the products it offers. Next, it is necessary for Vinamilk's
human resource management department to recruit more talents and improve the skills of
employees in the marketing department providing the success of the company for all people
in the world.
According to research from the General Statistics Office conducted in 2018, the number of
Internet users in Vietnam reached 64 million. Besides, the field of technology is growing day
by day. In my opinion, It is predicted that 80 million Vietnamese people will use the internet
in 2025. And this is the customer resource. Therefore, both Vinatex Da Nang or Vinamilk
need to know how to connect close coordination between the Marketing and Information
Technology departments to achive business goals.
19

CONCLUSION:
The report outlines the structure, diagram, and scope of the different organizations, and gives
definition to departments. Thereby clarifying the functions of the departments. Make an
assessment of the advantages and disadvantages of the company via SWOT Analysis and
comparison, giving out useful solutions for the company to quickly achieve the set goals.
20

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