Vinamilk’s SWOT analysis
Established since 1976, Vinamilk has grown strongly and become the leading business of the industry of milk processing. Obviously, its long history is the first and foremost strength to make it become the biggest dairy producer in Vietnam. Throughout more than 30 years operating, Vinamilk has become a familiar trademark to domestics’ clients. Also, Vinamilk has gained a great customer understanding and satisfaction as well as knowledge of the local market. Another remarkable factor that has actually strengthened Vinamilk’s leading position in the market is that it already holds a strong distribution presence which spreads nationwide, from urban to rural, coastal and mountainous areas. The distribution network is the decisive factor for the success of a consumer goods producer. Vinamilk is now operating agencies at grassroots levels like villages in rural areas, and almost all shops on the main streets of major cities sell Vinamilk products. In addition to the strong domestic distribution with the network of 183 agencies spreading over 64/64 provinces, cities, and Vinamilk products are exported to United States and many European countries as well as area of Middle-East and Southeast Asia. Along with the solid distribution network, technology capability is another key to success making Vinamilk a top business of the Vietnam milk industry branch. Vinamilk has ceaselessly renovated its technology, invested in modern production lines, improved administrative and products quality so as to meet increasingly high demands from customers. For the time being, VINAMILK possesses the most modern production lines in Vietnam which ensure the quality and hygiene. Additionally, Vinamilk also takes advantages of technical support from other firms to improve administration. Last year, it signed an Enterprise Agreement (EA) with Microsoft in Vietnam. Accordingly, the world’s leading software company will act as a consultant and reliable strategic partner of the dairy company by providing technical support, help the company make the most of its infrastructure to manage its business activity and information security, and deploy information technology in accordance with international standards. Besides, the year 2007 also saw the success of a large ERP (Enterprise Resource Planning) project at Vinamilk, which was the first e-business administration solution to be applied in Vietnam. With these technical advances, Vinamilk officers and staff work are expected to work faster and more efficiently to expand their business and enhance their competitiveness in the local market. Another important strength, which will be difficult for any other company to surpass, is the diversity of products it offers. Vinamilk’s products are diversified meeting demands of all ages. So far, VINAMILK has introduced in the market more than 200 brands of milk and dairy products for everyone from children, women during pregnant and breast-feeding period to the elderly. Along with these traditional products, the company also offers soft drinks, Soya milk and cool preservation such as ice cream, yoghurt, cheese and flan. Plus, it presents customers nutrition biscuit. b) Weaknesses
Strong as it is, Vinamilk still reveals some defects that needs direct adjustment. At the end of 2006, Vinamilk, as well as other dairy companies, faced the accusation from the public of committing trade fraudulence when providing incorrect information about the content of fresh milk products. This criticism actually affected the company’s prestige in the market. Mrs. Mai Kieu Lien, the Chairwoman and Director General of Vinamilk admitted the mistakes in labeling its dairy products and guaranteed to change the label of “pure sterilized fresh milk” into “sterilized milk”, however, confirmed the quality of its products. To make things worse, the press kept asking for the detailed content of its products. In response to this request, Vinamilk promised that...
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