HO CHI MINH CITY UNIVERSITY
OF FOREIGN LANGUAGES - INFORMATION TECHNOLOGY
FACULTY OF BUSINESS ADMINISTRATION
REPORT
Supply chain
ANALYZING THE BACH HOA XANH
Student’s name:
1. Nguyễn Thị Hạnh – 19DH481191
2. Nguyễn Lê Phương Thùy – 19DH480145
3. Lưu Cảnh Thành – 19DH
HCMC, 10/2022
CHAPTER 1: BACKGROUND OF THE COMPANY
1.1 Mobile World Investment Corporation (MWG)
MWG began operations in March 2004. MWG now has a network of more than 4,500
stores across the country and is the top retailer in Vietnam in terms of revenue and profit.
The Gioi Di Dong, Dien May Xanh, Bach Hoa Xanh, Bluetronics, An Khang Pharmacy,
Topzone, etc. are just a few of the retail chains that MWG now runs.
In keeping with the customer-centered culture that permeates every idea and action the
firm takes, MWG is committed to developing customer service of the highest caliber.
By 2030, MWG wants to be the top retail, e-commerce, and service conglomerate in
Southeast Asia.
1.2 Bach Hoa Xanh Trading Joint Stock Company
A network of stores with a focus on selling fresh food (meat, seafood, veggies, fruits,...)
and essentials, Bach Hoa Xanh was launched to be tested in 2015. With 1,719 stores by
the end of 2020, Bach Hoa Xanh was among the top three food and consumer products
retail chains in Vietnam.
Bach Hoa Xanh generated more than 8,000 billion VND in income in the first four
months of 2021, a 31% increase over the same time in the previous year.
Bach Hoa Xanh still had 2,140 stores by April 2022. On July 15, however, there were
just 1,824 stores left. The previous time have seen the closure of 300 stores, many of
which were inefficient and lacked the space required by the new regulations.
By the end of the year, Bach Hoa Xanh hopes to generate an average of 1.3 billion VND
per shop while rapidly expanding its online channel.
CHAPTER 2: THE GAP OF WHAT GG'S SAID AND IT'S ELEMENTATION
REALITY THAT LED TO CURRENT SITUATION OF EXPANSION FAILURE,
CLOSE-DOWN OF HUNDRED SHOPS
2.1 The gap of what GG’s said and it’s elementation reality that led to current
situation of expandsion failure, close-down of hundred shops
“Mobile World Investment Joint Stock Company (MWG), which aspires to be a multi-
industry retail corporation, surprised everyone in the final months of 2015 by announcing
that it would enter the food industry when testing Bach Hoa Xanh, a mini-supermarket
chain that focuses on selling fresh food and necessities.
The supply of agricultural products from farmers today follows an ambiguous path from
the market to the customer, according to CEO Nguyen Duc Tai. Thus, the introduction of
Bach Hoa Xanh will just open up a new route for getting goods from farmers to
consumers rather than altering the number of farmers or the supply. Mr. Tai claims that
this is a complementary manner of shopping and is not meant to take the place of
conventional markets or department stores.The 5 competitive factors that Bach Hoa Xanh
aims at are:
The network provides clients with convenience by covering residential areas.
High-quality food that is as fresh as food found in a regular market.
The list of items is longer than the actual food.
A convenient and modern shopping area.
Professional and customer-focused service approach” (OD click tư vấn và đào tạo,
2018).
“However, reality reveals that this chain of stores' business performance has fallen short
of expectations.
The department store company only has 1,824 active stores as of the evening of July 12,
2022, according to the information provided above from the sales website Bach Hoa
Xanh, many of which had up to 50 off warehouse clearance signs up % or closed while
being upgraded.
At the end of April, this chain of grocery stores had 2,140 locations. As a result, in a little
more than two months, there are now 316 fewer business sites”(Huy Lê, 2022) .
“By 2022, when consumers are no longer directly benefited by the epidemic and
businesses in traditional markets have fully recovered, supply chains are no longer
available, consumers have a wide range of options.interrupted, the business of Bach Hoa
Xanh chain immediately showed signs of decline”(Duy Bắc, 2022).
In addition, the Bach Hoa Xanh chain once again sparked controversy when it was
discovered that it was selling Chinese vegetables "disguised" as VietGap despite the drop
in revenues.
In comparison to other supermarkets, the Bach Hoa Xanh chain's deployment method is
equally unremarkable and lacks a distinct USP.
“Bach Hoa Xanh is not as good as VinMart in terms of assuring the source of the
commodities since VinMart is constantly proactive in getting clean vegetables from
VinEco. In contrast to the phone industry, Bach Hoa Xanh's supply network is highly
perplexing when it must interact with numerous vendors.
MWG has always pursued a broad coverage strategy, deeply penetrating all residential
areas. When it reaches even local districts and communes, this methodical approach is
considered to resemble The Gioi Di Dong's example. This course was appropriate for
Mobile World at the time because the company's name was already well-known. After
adding more locations, there was no need for more advertising because locals were
already familiar with it. The situation with Bach Hoa Xanh, however, is different because
a mobile behemoth has entered the food industry; it is reasonable that the project's
viability is in doubt; as a result, the Bach Hoa Xanh brand has not been successful.
powerful enough to cover before it is necessary”(OD click tư vấn và đào tạo, 2018).
2.2 SWOT analysis
Strengths
Strong brand:
According to Brand Finance, Vietnam's top 50 brands with a total brand value
of US$36.4 billion increased by 36% over the same time previous year. The top
ten Vietnamese brands are valued at $24.4 billion USD, accounting for 67% of
the total of 50 brands. This is the strength to focus on while assessing Bach
Hoa Xanh's SWOT model.
Bach Hoa Xanh is the brand with the biggest rise in brand value over the last
year, according to Brand Finance, followed by Novaland (132%). Kokomi
(121%), Bao Viet (116%), MBBank (113%), Omachi (109%), and Vinhomes
(99%). This is the strength to consider while studying Bach Hoa Xanh's SWOT
model.
Channel system diversification:
BachhoaXANH.com: An online shopping channel with over 12,000 unique
items, a clear provenance, and transparent pricing.
Excellent knowledge: A website for housewives and young people that gathers
news, family suggestions, recipes, and important health information.
Tic Tac Toe Share culinary lesson videos, valuable home ideas, beauty, and
other trendy stuff with Bach Khoa GREEN.
Youtube Bach Khoa GREEN: Share culinary instruction videos, family
suggestions, quick product introductions, and easy-to-understand product
descriptions.
GREEN Bach Khoa Fanpage: The channel swiftly refreshes information
regarding programs, promotions, or consumer news.
Call center for sales and customer service: 1900.1908 - 028.3622.9900. Hours
of operation: (7am - 9.30pm)
Strong Digital Marketing Activities:
BHX does not advocate traditional direct marketing tactics such as mail or
email, but rather enhances and fully utilizes online marketing media such as a
website, blog, and social media. This is the strength to focus on while assessing
Bach Hoa Xanh's SWOT model.
The BHX website (bachhoaxanh.com) and app are maybe the most popular and
commonly utilized communication tools. According to SimilarWeb statistics,
BHX received more than 8 million customer visits in the first quarter of 2020,
much outnumbering other prominent stores such as BigC, Vinmart, Coopmart,
and Lotte's SpeedL. This is the strength to focus on while assessing Bach Hoa
Xanh's SWOT model.
With such rapid rise in website traffic, Bach Hoa Xanh has established itself as
many consumers' first option. In general, the potential of this method of
communication is considerable; clients who frequently use the internet and
BHX applications will be familiar with it.
Bach Hoa Xanh solely uses one sort of social media, mostly Facebook, to
communicate with their consumers. The primary objective of BHX's Facebook
page is to promote a section of the BHX website. To increase engagement from
BHX Facebook page followers, the page regularly posts links to fresh articles
from BHX websites; some other articles are constructed as photos showcasing
things for sale. price.
Weaknesses
Website is not fully optimized
The Bach Hoa Xanh application and website have not been equipped with
advanced facilities, such as price comparison between items of the same type
but given by various brands, to aid users in their shopping experience.
The quality of fresh produce is poor:
Purchasing power, particularly for fresh food goods, is expanding in many
grocery chains on a daily basis. Fresh produce is plentiful, but grocery
employees must continuously reload the shelves.
Pork and chicken are essential food items in the Vietnamese home basket.
There are several sources of these items on the market, but those that are
branded and marketed in modern shopping channels with proper storage
conditions are becoming increasingly popular.
However, many customers complain that the fresh items at Bach Hoa Xanh are
not truly "fresh," and that the price is not justified. This is a flaw to be aware of
while examining Bach Hoa Xanh's SWOT model.
Opportunities
Food and beverage spending is high in Vietnam:
The food and beverage business in Vietnam has enormous growth potential.
According to Euromonitor International, Vietnam's F&B market is one of the
most appealing in the world, ranking 10th in Asia. Vietnamese people spend a
large amount of their income (about 35%) on food and drinks, and these
consumers are becoming wealthier.
Consumer demand for food and beverage items is progressively requiring an
improvement in quality, service, and diversity, particularly for products
originating in other countries. Premium food and beverage consumption is
substantial, but it is traded surreptitiously. Young people are more likely to
migrate from traditional to imported goods.
Growing retail business:
In general, total retail sales of consumer products and services reached VND
4,170.2 trillion in the first nine months of 2022, up 21% over the same time last
year, progressively catching up with the growth rate of the same period in prior
years. The retail category of items grew pretty well in the year preceding the
outbreak.
According to a poll of retail enterprises performed by Vietnam Report in
August 2022, 53.8% of retail businesses have already achieved business
performance equivalent to or above pre-pandemic levels, while there is still a
disparity amongst businesses.
Based on this recovery momentum, as well as Vietnam's advantages over other
countries in the area, 91.7% of firms polled predict that the overall retail
industry's business prospects in the latter months of 2022 will be stronger than
the same period in prior years.
Green consumption trends in Vietnam:
Green consumption is already quite popular in rich nations, and it is making
inroads in developing countries as personal affluence and consumption
consciousness rise. Consumers are becoming more concerned about the
environment, placing a greater emphasis on ecologically responsible
purchasing habits.
According to Nielsen Vietnam survey results revealed at the conference "Brand
strategy connected with green development," Vietnamese consumers are more
interested in "green" and "clean" concerns, and they are prepared to pay more
for companies that are committed to "green" and "clean." In particular, up to
80% of customers are concerned about the long-term effects of artificial
substances, and 79% are prepared to pay more to purchase items that do not
include undesired components.
Online buying trends are on the rise
Since 2018, online shopping has been on the rise. This type of purchasing, in
particular, will develop faster than ever before by 2020. E-commerce
exchanges (e-commerce) are the most common online shopping channels,
followed by social networks. It is the inherent benefits of e-commerce that
allow for the rapid development of online buying activities.
Finding items and services over the internet, in particular, will be significantly
faster and less expensive. Using the internet can also assist consumers in
discovering new things as well as finding products and services that are more
suited for them.
Furthermore, online purchasing allows for far easier interaction with clients
than conventional shopping.
Threats
Tough competition
With the existence of very prospective bosses, bosses with ideal management
expertise, and bosses who hold reputed suppliers, Vietnam's retail sector is at a
really fierce stage. most well-known and well-liked
According to the Ministry of Industry and Trade, Vietnam now boasts almost
1,000 supermarkets and trade centers. However, the number of supermarkets
with names and financial potentials... can be be counted on one hand, including
both Vietnamese and foreign-invested firms.
The data also reveal that, in recent years, the supermarket system Saigon Co.op
(Vietnam Cooperative Alliance), with models ranging from convenience stores
to contemporary supermarkets... has become a huge brand, exceeding several
brands of local and global giants.
There are several gaps in clean product input management
Supermarkets currently satisfy just 15% of people's fresh food needs. Although
grocery chains have control mechanisms in place, they concede that it is
difficult to oversee 100% of items when suppliers utilize deception.
Most supermarkets rely on suppliers for supplies. Some providers have tried
tactics to gain from such demand, using their long-standing reputation.
CHAPTER 3: RECOMMENDATIONS AND CONCLUSION
3.1 Recommendations
3.1.1 Strengthen brand loyalty
Regarding the staff's service capacity: First off, when it comes to immediately attending
to consumer demands, more employees should be on hand during busy periods to make
sure that consumers are attended to as soon as possible. In order to improve employee
awareness of the working process, employers should place a strong emphasis on hiring
and training staff who have a strong customer service attitude and appropriate
communication skills. Additionally, employers should be able to effectively
communicate to employees the work's objectives and the company's business strategy.
Regular staff training should be conducted and maintained, particularly in terms of
product expertise and devoted, pleasant, and fast customer care.
Pay attention to the variety and up-to-dateness of the products: The aisles between the
shelves should be pleasant, and the supermarket floor should be spacious. The placement
of the items must be considered; those belonging to the same category and having a
similar relationship should be placed next to one another. Even if customers aren't yet
planning to buy them, this helps draw their attention. Customers consider safety features
like exits and effective fire suppression systems when they buy at a supermarket. In
conclusion, it is important to periodically assess the quality of the services provided at
retail supermarkets in order to raise the level of satisfaction among consumers and foster
their loyalty to the store.
Ensuring the quality of goods and products: Making commitments to uphold brand trust,
keeping one's word, and providing the quality of goods as promised are all necessary to
establish credibility in the marketplace. Increase your investment in machinery and
equipment like cash registers, receipt printers, and barcode scanners to increase the
dependability of your items selling. To prevent errors, assure accuracy, and maintain
security while dealing with consumers, it is essential to periodically examine the
equipment and replace it as soon as it becomes broken or malfunctioning. In addition, it
is important to keep prices steady. In order to offer prices that are comparable to market
prices without making a significant difference, it is vital to keep track on promotions and
pricing practices at rival shop systems. The business ought to think about providing
consumers with discounts for making large purchases.
Expanding operating hours, diversifying payment methods: The retail system needs to
stay open later, until 10pm or 10:30pm. As a result, shoppers, particularly young ones,
might feel more at ease. Additionally, this enables Bach Hoa Xanh to sell more products
throughout the day. Regarding the store's promotion and discount policies: make each
promotion unique, vary promotions by offering them in a variety of ways, such as loyalty
cards, birthday presents, etc. In regards to payment policy, customers would find it more
convenient if there are a variety of payment options available through e-wallets like
Momo, VNPAY, Zalo Pay, etc.
3.1.2 Proposing a solution to solve the crisis
Early problem detection and crisis timing will help to streamline and expedite the
resolution procedure. Clearly demonstrate contrition and a willingness to improve. Don't
keep quiet or avoid talking to the media.
Businesses that wish to grow over the long run must pay close enough attention to their
consumers. Any price increases that are unreasonable during a time when oil is in high
demand will lose most of the prior support. In order to address the issue, Bach Hoa Xanh
must attend press conferences. Give a thorough explanation of the problem, extend an
apology to appease consumers, and include promotions. In order to discover a means to
overcome and reduce the dangers in order to avoid such a circumstance, Bach Hoa Xanh
must also think about and determine the incident's causes and sources. If the price of the
items changes, the consumer must be notified in advance and provided a reasonable
rationale for the adjustment.
3.2 Conclusion
REFERENCES
