Business and Business Environment Report: Vinamilk Analysis & Insights

This report provides a detailed analysis of Vietnam Dairy Products Joint Stock Company (Vinamilk), examining its business and business environment. The report begins with an introduction to Vinamilk, its history, and its position as the leading dairy processing company in Vietnam. It then delves into key aspects of business operations, including the differences between for-profit, non-profit, and non-government organizations, and classifying Vinamilk as a for-profit entity. The report further explores the legal structures of organizations, specifically the sole trader, partnerships, and limited companies, identifying Vinamilk as a public limited company. It also differentiates between private and state-owned enterprises, classifying Vinamilk as a private enterprise. Additionally, the report discusses the company's vision, mission, core values, size, scope, levels of activity, organizational functions, and organizational structure. The report utilizes tables and figures to present data and analysis, providing a comprehensive overview of Vinamilk's business operations and its environment.

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ASSIGNMENT 1 FRONT SHEET
Qualification BTEC Level 4 HND Diploma in Business
Unit number and title Unit 1: Business and Business Environment
Submission date 17/06/2021 Date Received 1st submission
Re-submission Date Date Received 2nd submission
Student Name Lê Hoàng Ngọc Ánh Student ID GBS20036
Class GBS0907 Assessor name Phạm Min
Student declaration
I certify that the assignment submission is entirely my own work and I fully understand the consequences of p
that making a false declaration is a form of malpractice.
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TABLE OF CONTENTS
I. INTRODUCTION ................................................................................ 5
II. BODY .............................................................................................. 6
1. Differences between For – Profit, Non – Profit and Non – Government Organizations .. 6
a. For – Profit Organization .......................................................................................................6
b. Non – Profit Organization .....................................................................................................7
c. Non – Government Organization (NGOs) .............................................................................8
2. Legal Structures of Organizations .................................................................................. 10
a. The sole trader........................................................................................................................................ 10
b. Partnerships ............................................................................................................................................ 11
c. Limited Company ................................................................................................................................... 12
3. Private or State – owned Enterprise .............................................................................. 15
a. Private Enterprise .................................................................................................................................. 15
b. State – owned Enterprise .................................................................................................................... 16
4. Vision, Mission, Core Values .......................................................................................... 17
a. The Vision ...........................................................................................................................17
b. The Mission .........................................................................................................................17
c. The Core Value ....................................................................................................................17
5. Explanation the Organization Size and Scope ................................................................ 18
a. Organization Size ................................................................................................................18
b. Scope of Vinamilk ...............................................................................................................18
6. Level of Activity .............................................................................................................. 20
a. Primary Sector ....................................................................................................................20
b. Secondary Sector ................................................................................................................20
c. Tertiary Sector .....................................................................................................................20

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7. Relationships between various organizational functions .............................................. 21
a. Marketing Functions ...........................................................................................................21
b. Finance Functions ...............................................................................................................21
c. Human Resource Management ( HRM ) ..............................................................................21
d. An accounting department .................................................................................................22
e. Production and Operations Management ..........................................................................22
8. Organization Structure ................................................................................................... 23
a. Functional Structure ...........................................................................................................23
b. Divisional Structure ............................................................................................................24
c. Matrix Structure ..................................................................................................................24
d. Project – Based or Team - Based Structure .........................................................................24
e. Vinamilk Organization Structure.........................................................................................25
III. CONCLUSION: ............................................................................ 26
IV. REFERENCES: ............................................................................. 27

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I. INTRODUCTION
Vietnam Dairy Products Joint Stock Company, often known as Vinamilk, is a Vietnamese company that
manufactures and trades milk and dairy products, as well as related equipment and technology. Since its
founding in 1976, the company has grown to become the top dairy processing company in Vietnam, with a
35 percent market share. Vinamilk has established eight factories, one plant, and is now developing three
more factories, with a variety of products and Vinamilk supplies the market with a variety of products, after
more than 30 years of launching to consumers. The most diverse range of products, flavors, and packaging
possibilities.
Business name Vietnam Dairy Products JSC
Type Joint-stock company
Stock symbol HOSE: VNM
Industry Dairy products, juice
Founded 1976
Headquarters
10 Tan Trao, District 7
Ho Chi Minh City
Vietnam
Area serviced Worldwide
Key people Mai Kieu Lien - CEO
Products Liquid milk, condensed milk, powdered milk,
probiotic, yogurt, ice cream, soft drinks
Brands Vinamilk, Dielac, Susu, Vfresh, Ong Tho, Probi
Services General clinic, investing, real estate
Revenue 52.63 trillion VND (2018) ($2.2 billion)
51.135 trillion VND (2017) ($2.2 billion
Net income 10.278 trillion VND (2017)
Number of employees 6000 (2017)
website http://www.vinamilk.com.vn/
Source: Wiki

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II. BODY
1. Differences between For – Profit, Non – Profit and Non – Government Organizations
a. For – Profit Organization
A for-profit organization that focuses on a goal such as helping the community and is only concerned with
money to keep the organization operating, as opposed to a non-profit organization that focuses on a goal
such as helping the community and is only concerned with money to keep the organization operating.
(What is a for-profit organization? Examples - Market Business News, 2021) For example: Nestlé, FPT Corporation
Figure 1
Source (Nestle.com and FPT.com)
 Advantages: The ability to make money is perhaps the most evident benefit of a for-profit corporation.
Aside from financial advantages, for-profit business owners are their own employers. Moreover, Non –
profit organizations must be scrutinized by the Internal Revenue Service to ensure that they are working
toward their stated goals. While certain industries may be regulated by the government, for-profit
corporations as a whole are free to operate as they see fit as long as they follow the law.
 Disadvantage: A profit organization is one that is required to pay taxes on its earnings. Therefore, profit
organizations must face difficult decisions like whether to reinvest earnings in further expansion or
distribute them to shareholders in the form of dividend payments.

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b. Non – Profit Organization
An NPO (non-profit organization) is a group dedicated to a social cause in the fields of religion, science,
research, or education, or advocating for a particular point of view. Instead of being allocated to
shareholders, members, or workers, all income made by a non-profit organization are utilized to further its
primary objects. ( Investopedia - Nonprofit Organization (NPO), 2021)
For example: Catholic Charities USA, AmeriCares, YMCA
Figure 2
Source (publicinterestfoundation.com)
 Benefits: Many employees who work for nonprofits have a private interest in and commitment to the
organization’s cause. When a company has nonprofit status, particularly when recognized at the federal
level by the IRS, it can make the most of tax and financial
 Drawbacks: Developing and obtaining funds for a nonprofit organization can be difficult, especially
during a recession and when unemployment rates are high.
( Source: Advantages & Disadvantages of Nonprofits, 2021)

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c. Non – Government Organization (NGOs)
A non-governmental organization (NGO) is a non-profit organization that is not affiliated with any
government. NGOs, sometimes known as civil societies, are non-governmental organizations that are
organized on a local, national, and worldwide level to serve a social or political aim such as humanitarian
issues or the environment. ( Investopedia - What is an NGO (Non-Governmental Organization)?, 2021)
Figure 3
 Pros: They have the freedom to try out new ideas and, if required, take risks and also they can
communicate at all levels, from the local level to the highest levels of government. In addition, they have
less constraints than the government when it comes to hiring expertise and highly motivated employees.
 Cons: First, The degree of participation in program/project design is limited by paternalistic views.
Another disadvantage is restricted/constrained approaches to an issue or problem area.
( Source: Types of NGOs: By orientation and level of Operation, 2021)
 Following the above analysis, it is clear that Vinamilk is a For – Profit Organization that
focuses on goals such as strategy, finance, and other aspects of business operations in
order to stay in business.

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Table 1
( Source: baocaothuongnien2019)
As you can see from the data sheet, 2019 was a very strong year for Vinamilk in comparison to 2018.
Revenue has nearly doubled to nearly 50 million VND, with selling expenses increasing as well. Other factors
such as profit after tax and tax income have steadily increased from 1 to 2 million VND, with profits
following suit. In terms of other comprehensive incomes, the increase in 2019 is expected to be significant.
 Vinamilk is a Profitable Company

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2. Legal Structures of Organizations
a. The sole trader
A sole trader is the most basic business structure, and it is relatively straightforward and inexpensive to
establish. You will be legally liable for every part of your firm as a lone trader. You'll most likely make all of
the decisions regarding how to establish and run your company, and you'll be able to hire people.
Figure 4
 Advantages of being a sole trader: firstly, it's easy to set up and use. Secondly, your assets and business
decisions are completely within your control. Thirdly, there will be less reporting requirements. Another
benefits are any losses experienced as a result of your business operations may be offset by other sources
of revenue, such as investment income or salaries (subject to certain conditions); because you are not
considered an employee of your own company, you do not have to pay payroll tax, superannuation, or
workers' compensation on the money you earn from it; if your company grows or you want to wind things
down, it's rather simple to change the corporate structure.
 Disadvantages of being a sole trader: If something goes wrong, you will be held liable for all of your own
assets and you can't divide business profits or losses with family members, and you're individually liable for
all of the business's income.

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b. Partnerships
A partnership is a type of business in which two or more people share ownership of the company, as well
as the responsibility for managing it and the profits or losses it creates. This income is distributed to
partners, who claim it on their personal tax returns - the business is not taxed separately on its earnings or
losses, as corporations are.
For example: Bonne Belle & Dr. Pepper, Apple & MasterCard, etc
Figure 5 (up-rev.com)
 Useful of being a partnership: First, it's really simple to set up and keep up with over time. Second,
partners can pool their resources to help the company get off the ground and partners can split the
workload and enjoy the benefits of the company's success. Moreover, offering important employees the
opportunity to one day become partners in the company might be a major inducement for them to stay
long-term.
 Harmful of being a partnership: Despite the fact that partners split any profits generated by the
business, if the payout does not correspond to each partner's commitment to the company, conflicts can
arise. Besides, partnerships have joint and individual liability, unlike corporations, which help to shield
owners from liabilities. That is, each partner is responsible for both their own activities on behalf of the
corporation and the activities of their other partners.

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c. Limited Company
A limited company is a commercial form in
which the firm has its own legal personality,
distinct from the owners (shareholders) and
managers (directors). Even though a
corporation has only one shareholder and
director, it is still an independent legal entity.
Figure 6
 Private Limited Company
A limited liability corporation, or LTD, is a sort of privately owned small business. This type of company
structure bans shareholders from openly exchanging their shares, limits owner responsibility to their
shares, and limits the number of shareholders to 50.
Examples:
Figure 7
*Limited Liability: means that investors can only lose money they have invested Encourages people to finance company