Marketing Analysis: Ready Meals Expansion in Vietnam - PESTLE & SWOT

This report presents an international marketing strategy for the expansion of ready meals in Vietnam. It begins with an introduction to the ready meals market and its appeal to consumers with busy lifestyles. The core of the report involves a detailed PESTLE analysis, evaluating political, economic, social, technological, legal, and environmental factors impacting the market. Each factor is examined for its effects on the organization's performance, including potential risks, market share, and future prospects. The report also includes a SWOT analysis, assessing the internal strengths and weaknesses and external opportunities and threats relevant to the expansion strategy. The analysis considers factors such as Vietnam's WTO membership, economic conditions, social dynamics, technological advancements, and legal environment, providing a comprehensive overview of the market's potential and challenges. The report concludes with a discussion of the strategic implications for companies entering the Vietnamese market.

MARKETING-PART-1

Contents
Part-A....................................................................................................................................................2
Introduction...........................................................................................................................................2
Ready Meals..........................................................................................................................................2
PESTLE Analysis..................................................................................................................................3
SWOT Analysis.....................................................................................................................................8
References...........................................................................................................................................12

Part-A
Introduction
The report brings out a discussion on international marketing strategy, which features the
expansion of Ready Meals in Vietnam. This proliferation undertakes to examine political,
technological, legal, social, economic, and environmental factors (PESTLE Analysis) and its
related structure in Vietnam (Nguyen, 2016). On the basis of these factors, each parameters
will be discussed such as current weakness, future associated risks, sales distribution, future
trends, market share, market status, current challenges, distributors, and future prospects.
PESTLE Analysis includes the analyses of external factors, which include the impact of these
fluctuating situations on the organisational performance especially before starting the
business or even entering the foreign market (Ngo, 2016). SWOT analysis is a strategic
framework, which is used examine the organisation’s competitive position in the
development of strategic planning that includes the analysis of both internal (strength and
weakness) and external factors (opportunity and threat) (Son, 2019).
Ready Meals
The retail vendors introduced this meal as an alternative meal, which is fast, cost effective,
and quick that is just required to be heated before consumption. Ready meals has been
packaged and availed in quantity for one or two serving (Hoban, Nash, Musgrave, and Byard,
2018). With hectic lifestyles, customers often prefer Ready meals, which will reduce the
cooking time and preparation and finally leading to the progression of overall market. Some
of the existing examples of Ready Meals are JBS, Iglo Group, Nestle, Unilever, McCain,
Maple leaf foods, Tyson foods, Schwan food, sigma Alimentos, Greencore group with the
advanced fresh concepts. A certain amount of revenue production of the ready meals is nearly
USD 104063 Million in 2015.

PESTLE Analysis
Political factors- Vietnam has accessed WTO in 2007 and after twelve year of discussion
and negotiation. It has been marked where political conditions have significance in the global
economy when entering the country for business (Pham, 2018). WTO membership has tried
to reduce the restriction and tariffs in regards to the Vietnam exports to other states that has
benefited the nation. The country is a better place to attract FDI since the accession. WTO
membership has finally boosted the nation`s exports, which has helped as one of the part of
the international economy (Pham, 2018).
Socialist republic of the country remains as one of single communist party states with Cuba,
Loas, North Korea, and China. The communist party kept some political environment, which
is relatively stable when it has few riots. Recent event was violent in regards to anti-China
that had been burnt down for the several factories because of China`s deploying it in
regarding the conflicting water happening in the summer in some of the major cities (Trinh,
and Le, 2018). The government will try to dismiss most of people`s protesting that has been
leading to the freedom of speech. As per the Human Right Watch Organisation (HRWO)
where the situation of human rights of Vietnam is destroying, which remain major issue in
the country. Corruption and bureaucracy has remained a great level of making the
government efforts in order to apply solutions (Hoang, Hoshino, and Hashimoto, 2015).
Political impact- when Company wish to enter in the market it should consider the limits on
the free speech and political activities. Military presence and large police force is quite
common. It is not a major risks to foresee the suggestions of Vietnam in order to reduce
political risks by including local partners, minimising the fixed investments, local banking,
and creating the operation invaluable (Tang, and Tan, 2015).
Economic factors-

Government of Vietnam has been coming up with the rising pressure because of issues
related to debt repayment by the state owned enterprises (Van, and Mai, 2019). The country
has been facing lower unemployment level and finally global financial crisis has affected the
nation`s GDP (Gross domestic Product). As per the GDP and per capita income falls in the
category of lower middle-income level group. Before 2008 and economic crisis, GDP was
increasing by 5, 6, and 7 percent (Van, and Mai, 2019). This suggests that it is safe enough to
remain potential market. The exchange rate of VND (Interest rate of Vietnam`s) to USD has
been measured 21565 VND with 6.5 percent. The unemployment rate of the country has been
reported as two percent in several years, which is extremely low (Van, and Mai, 2019).
Nearly, 9.8 percent of the population still stays in poverty. The GDP of the country has been
given below-
(Source: trading economics, 2018)
The Vietnam`s overall economy has been dominated by the service sector that contributes 49
percent of total GDP in 2015, industrial sector subsidizes one-third of total GDP in which
manufacturing has 13.8 percent of GDP. Although, the country`s government has been
focusing on the reformation and restructuring focused on state economic companies, credit

companies, public investment, and state commercial banks. Extreme and total consumption
suffered from increase in the household consumption and government spending that is
expected to emerge as main driver of Vietnamese economy (Mordor Intelligence, 2019).
(Source: trading economics, 2018)
Economic effect- By considering the investment in Vietnamese market, it is important to
consider economic factors such as personal disposable income, high inflation rates, and weak
currency. This factor signifies that there are several opportunities to remain exploited in
Vietnam`s economy and also their priority focusing international trade has been encouraged
(Pucher, Mayrhofer, Matbouli, and Focken, 2015).
Social factors-
With the increased youth population, the country have huge population and abundant labour
force. Number of person in the area of working people in regards to 53,748 million
accountable for near to more than the population (Pucher, Mayrhofer, Matbouli, and Focken,
2015). The labour force are still under skilled in terms of language, behavioural, and

technical skills. Businesses incurring FDI find difficulties while recruiting Vietnamese
directors, leaders and managers (Thanomnuea, and Sangayotin, 2018). It is seen that top
position will not be able to fulfil because of lack of advanced skills for management and other
essential knowledge in financial and law fields. The lifestyle of the people living in Vietnam
are defined as informal, relaxed, and close to each other. This is one of the things that can be
considered through which any company can take advantage (Thanomnuea, and Sangayotin,
2018). At the same time, there is a social issue, which can affect heavily the business, as it is
one of the important principle of peer-to-peer economy through trust. It is important to take
crucial steps in terms of media that has been continuously exposed to robbery, frauds, and
rapes that happened in the past but it has gained better attention. Although, Vietnamese
people are more friendly but most of times they do not trust each other. Growth rate of
population of Vietnam is nearly 1 percent in recent years. It is seen that the density of the
population in Vietnam is nearly 300 people per square kilometre. Nearly 33 percent of
Vietnam`s population has been living in urban areas and maximum of population lives in
rural area that have limited technological facility. Sharing economy organisations find it
harder in order to expand the customer base as it totally depend on high technology
(Thanomnuea, and Sangayotin, 2018).
With the passage of time, the demand for instant noodles, and rice based products by
including porridge (ready meals) that has become popular because it is considered as
healthier as compared to instant noodles. Instant porridge and ready meals can be suitably
profound in distribution channels.
Technological factors-

(Source: Press Release, 2018)
Under this factor, government has permitted certain projects and plans, which can support IT
and other telecommunication in Vietnam in current years. For example- decision of prime
minister on the approval of development of IT and communication technology until 2010 and
also their orientation and promotion until 2020. Decision for the approval of the schemes in
order to make Vietnam a strong country in both communication as well as information
technology. Constructing the projects on the improvement in the ability and accessibility of
public internet in the country.
IT in Vietnam has been developing increasingly and government supports it. As per the 2014
data reports, it is seen that only 20 percent of people stand out for online transaction so that
connectivity is relatively low. A large number of internet users are not quite familiar with the
buying products and services. This factor can become disadvantageous for the organisation in
sharing economy that is based on technology heavily.
Legal factors- Legal environment in Vietnam has been regarded as complicated by the
investors. Vietnamese legal framework has been suffering deficient transparency,
dependability, and consistency. Unstable legal actions and unpredictable remained as one of
the major concern for foreign and local investors. There is no related law and other

regulations in the sharing of the economy. It is important to know that tax obligations of the
organisations, safety, and security of the customers has been emerging as a challenge.
Vietnam enacts as per its constitution in order to strengthen many legal institutions for the
economic payment. Vietnam strives to improve legal system so that they could create for
development of the multi-sector market with open and stable investment decisions. Legal
framework establishment open door policy and comply with the integration needs of
international agreements, which includes civil code, the labour code, law on enterprises, land
law, law on accounting, law on real estate, commercial law, and law for corporate income
tax.
Environmental factors- Hanoi is one of the most polluted place in Vietnam because of high
population density and excessive transportation. Pollution is one of the unsolved issue for
both government as well as population density. People in Vietnam is more aware of nearby
surrounding. Recent viral event in regards to environmental awareness, which was relatively
peaceful demonstration of offline and online against the authority`s decision to cut down
6700 trees in order to replant new kind without even consulting to the citizens. As per the
author`s inspection, the increasing awareness of people on many environmental problems.
Natural disaster hit most places in Vietnam because cities near the coastline located in middle
part are safe.
SWOT Analysis
Strengths
Young and active population on internet. Internet users are dynamic and young between the
age 18 years and 40 years (Nguyen, 2017). One of the popular thing in the local market is the
learning of the foreign languages as English is a popular trend. With increasing people who
know how to write and read in English as the chances available are quite interesting on
internet (Nguyen, 2017).

Google has dominated local search marketplace. It grabs 90 percent of the market share.
Booming use of social sites and other entertainment sites. Without looking much into detail,
there is a brief number of social networking and entertainment sites in Vietnam. The number
of users is nearly one lakh (Arita, Dyck, and Marquardt, 2015). Vietnamese professionals use
networking site “cyvee.vn” so that they can gain popularity among the Vietnam professionals
where it is more or less like “one man show.”
Weaknesses
Infrastructure- Vietnam has been facing several challenges such as low investment and low
foreign reserves. Other more challenge is that Vietnam has weak roads, ports, railways, and
infrastructure especially in order to cope up with nation`s economic growth and linking
between the outside world (Minh, 2017). International bandwidth is quite limited where
Vietnamese confront huge challenges especially when it comes accessibility to the
international sites and portals (Minh, 2017). Another practical issue was with the intermittent
network connectivity occurring when trying to conduct a decent online conference by
collaborating in Vietnam (Minh, 2017).
Corruption has remained a major issue especially among the governmental officials and
legitimacy of ruling communist party. Increasing public dissatisfaction in relation to
leadership`s severe control on the political dissent.
High online servicing fees- Price of doing any small thing such as domain registration and
web hosting is accurately double as compared to normal price in Singapore. Service providers
in Vietnam often charges USD $ 50 to 60 every year. As per the law, if one need to continue
business operations in Vietnam especially .vn or .com.vn and the registered domain with
local provider when it gives limited choices. The cost of performing web designing in
Vietnam has been increasing as you can get cheap price.

Opportunities
From the Vietnam’s food reports, it is seen that guidance to ready meals in order to shape the
market at the national level. It avails the recent retail sales of four years from 2012-2016,
which will allow in the identification of sectors with the driven growth. It generally identifies
leading organisations that covers the menu of chilled lunch kit, dinner mixes, Frozen Pizza,
prepared meals, prepared meals, dried ready meals, and stable ready meals.
The government identifies a threat of corruption that pose its legitimacy, which has further
acted to clamp among the party officials. Vietnam has further allowed legislators while
becoming more vocal in criticising the government rules. This open up with more balances
within one-party system. Slowdown growth weighs the acceptance of one party system and
the street demonstrations with an aim to protest the economic conditions that can be easily
developed in an undemocratic rule.
Packaged food sales and foodservice has been rising continuously because Vietnamese
customers often eat outside very frequently. Large local food service chains has been
increasingly expanding to the international packaged food suppliers. Foodservice retail
outlets in the locations often focus on improving the quality of service and interior design.
Threats
High competition within the industry and Vissan is a clear leader in the ready meals in 2018.
Vissan has the experience of more than 40 years and it use its knowledge and experience to
grab the whole market in order to extend its product line and portfolio within the frozen food
and processed meat.
Embryonic e-commerce- Many local and international banks started issuing the credit and
debit card after 2007. Vietnam face many issues in regards to the e-commerce. Lack of E-
commerce law is not transparent enough.

Conclusion
From the above discussion, it can be seen that Vietnamese retails sector has projected
regarding the stronger registration in the forecast period from 2019 to 2024. One of the major
factor included regarding the traditional markets is the purchasing of ingredients in small. In
response to this factor, supermarket has been offering RTCs and the ready to cook packages,
which are built to suit the routine needs of the consumers. Food and ready meals are made
available in supermarkets. The expansion can be very useful to the food retail industry
especially (traditional retailer) dominates the Vietnam. Traditional retailers specify for 94
percent of the retail grocery sales with the remaining 6 percent of sales are under modern
retail sales. Traditional retailers with lower rental and operational cost has relatable flexible
packaging sizes accomplishing with the competitive prices.