Operating in today’s business would has become more challenging, especially in international context. As the world never stops changing, the world’s economic trends continue to shift to. The Khind successful stories in Malaysia make Khind have an intention to internalize the business. Khind has foreseen the market potential of Vietnam market and expand its business in Hanoi.
To make the investment more effectively, KHIND did further research and analysis on the host country (Vietnam) in obtaining information before marketing the ANSHIN rice cooker to the country. Furthermore, further studies on the competitors were done to have a better understanding on ways to compete with the competitors.
The inner pot of the rice cooker is made stainless steel which is believe to be new in the market in Vietnam, as most of the inner pot of rice cooker available in Vietnam are not made stainless steel and may cause some health issues. Moreover, the place that KHIND will first market its product will be in Vietnam’s capital city which is Hanoi. The rice cooker will be marketed to the two major hypermarkets in Hanoi. The recommended retail price will be $181.50. Several promotion tools such as advertising and even education programs are conducted to help improve the sales of the rice cooker. There were also a small of commission given to the retailers.
Lastly, several ways of controls are to be implemented in order to measure and monitor the action programs. KHIND has to make sure that the action programs are implemented effectively, so that money is allocated efficiently on to the action programs.
1.1 Corporate Background
Back in 1961, Cheng King Fa started a modest business in Sekinchan trading electrical goods. Driven by his clear vision, the business flourished and in the late seventies, developed to include the manufacture of electrical accessories and lamps. The next decade witnessed KHIND's increasing venture into the increase export market. In 1992 KHIND's manufacturing expanded to include fans and other household appliances and by the turn of the millennium, the Group was distributing audio-visual products and white goods. Today, the KHIND Group, which was listed on the KLSE on 12 August 1998, manufactures and distributes world-class electrical home appliances across Malaysia and exports to over 50 countries worldwide. (http://www.khind.com.my/background.asp, 2008)
2. Situational Analysis:
2.1 Introduction of economy of Vietnam
Vietnam's economy is 49.8 percent free, according to our 2008 assessment, which makes it the world's 135th freest economy. Its overall score is 0.4 percentage point better than last year, mainly reflecting an improvement in trade freedom. Vietnam is ranked 25th out of 30 countries in the Asia–Pacific region, and its overall score is lower than the regional average. Vietnam's score on government size is above the world average. Total government expenditures equal about a fourth of GDP, which is relatively low compared to other countries. Yet weakness in all other areas suggests that this is not because of bureaucratic efficiency. The government imposes high personal tax rates, but overall tax revenue is not so large.
Vietnam has weak investment freedom, financial freedom, property rights, and freedom from corruption. Although it is undergoing reform, the financial sector is neither well regulated nor independent of the government. Despite some progress made, foreign investment is subject to an array of opaque regulations and cannot be guaranteed legally. The judiciary is subject to political influence, and commercial cases often take years to reach resolution. Corruption is a serious problem in the legal system, as well as for the civil service as a whole.
The Socialist Republic of Vietnam continues to reform its economy while maintaining a single-party state. Vietnam now boasts the fastest-growing economy in Southeast Asia,...