Vinamilk strategic account business plan

STRATEGIC ACCOUNT BUSINESS PLAN
For METRO Cash & Carry
METRO Cash & Carry
Co. METRO Cash & Carry Vietnam
Lot B, New Residential An Phu - An Khanh
An Phu Ward, District 2, Ho Chi Minh City, Vietnam.
Course & Section: MKT 440 & SM4.
Submitted by:
LÊ HOÀNG KIM DUYÊN_1158028
PHAN NGUYỄN PHƯƠNG ANH_1158007
NGUYỄN HẢI PHƯƠNG HẠNH_1158034
ĐỖ THỊ PHƯƠNG DUNG_1158022
LÊ THỊ THANH TÂM_1158124
GROUP 5 – 11BSM4 – VINAMILK Sale Team
DATE: 06/26/2014
METRO Cash & Carry Company
File: Group5_11BSM4 Strategic Account Business Plan.doc
Date Published: 06/26/2014

Group5_11BSM4 Strategic Account Business Plan
Table of Contents
Documents Objective...................................... 3
Introduction .................................................... 3
The Client Background .................................. 4
Target market................................................. 5
SWOT Analysis ........................................... 5,6
Competitive Analysis ................................... 7,8
Customers need .............................................. 8
Sales opportunities ...................................... 8,9
Sales strategy ........................................ 9,10,11
Communication plan .................................... 11
Financial forecast ......................................... 12
Required Resources .................................... 13a
METRO Cash & Carry Company Page 2 11/13/2014

I. Documents Objective:
We are doing a sale plan for 1 year sale for the purpose to complete product
launch plan and obtain sign off from sales and engineering by June, 2015. According to
the plan, The Company wants to reach the sales target of over 8 million; adding 2
distribution partners and achieving a large sales volume through these partners by 2015.
For customers, we hope we could expand sales to the current customers as well as
increase their loyalty and retention; for new customers, we introduce existing products
and more importantly, we want to anticipate future customer needs through the feedback.
II. Introduction:
In recent years, dairy has become one of the fastest growing sectors in the food
industry of Vietnam. Along with the common trend of developing countries, Vietnam
dairy’s demand is significantly increasing as a crucial supplementary nutrition source.
One of the most leading dairy companies in Vietnam, Vietnam Dairy Product Joint-stock
Company (Vinamilk).Being considered the leading producers of dairy products in
Vietnam, VINAMILK Corporation was established in 1976. In 2005, the company was
officially listed on the Ho Chi Minh Stock Exchange (HOSE). In average, its domestic
revenue enjoys a gradual increase of 20% - 25% every year. The company is currently in
possession of 9 milk factories throughout the country, 1 coffee factory located in the
South, 1 general hospital. The three branches located in three biggest cities, namely Ho
Chi Minh City, Ha Noi and Da Nang City, are able to generate a total output of 504,000
tons of milk per year. There are 5 main brains; they are milk products and products from
milk. Milk product: sweetened condensed milk, fresh milk, milk powder, Product from
milk: Ice-cream, cheese, yoghurt. And many other products as: Tea, Coffee, and Fruit
Juice…Vinamilk committed to providing the best products for consumers. Vinamilk has
invested in technological innovation to manufacture heathful products. The quality is
being improved to meet the needs of consumer. The material is selected carefully. You
are really comfortable to use Vinamilk Products. Nowadays, Vinamilk product is the
most popular milk product in Vietnam because of their reasonable price policy.
VINAMILK's dairy products are divided into many categories including liquid milk,
powdered milk, condensed milk, drinking and spoon yogurt, ice cream and cheese
(VINAMILK's Homepage, 2011). The company's products are also exported to many
foreign markets such as Germany, USA, Canada and China. And most amazing is
VINAMILK claiming to have an 80% domestic market share with regard to dairy
products.

III. The Client Background
METRO Group is an international wholesaler brand name which provides many kind of
products to serve the general demands of various customers. Under the brands METRO
and MAKRO it develops over 761 wholesale stores in 28 countries all over the world.
Metro’s vision is become the best retailer and develop the process of entering the
international market. METRO Cash & Carry will pledge to run with the good quality of
environment and strong services to meet customers’ needs in the highest current
lifestyles. METRO Cash & Carry was built firmly on the philosophy of customer
centeredness.
Today, Metro is known for its close atmosphere and friendly outlets that offer a
assortment of fresh and quality products at reasonable prices. They develop in many kind
of services, such as supermarket operations, department store operations, appliances, fine
jewelry, pharmacy, fast food outlets, shops, coffee shops, photocopying, framing,
embroidery and gift wrapping services.
METRO decided to enter Vietnamese market by 2002 with the name METRO Cash &
Carry. It is one of the biggest wholesale dealers in Vietnam with 19 branches in big cities
and provinces.
Contact:
Co. METRO Cash & Carry Vietnam
Lot B, New Residential An Phu - An Khanh
An Phu Ward, District 2, Ho Chi Minh City, Vietnam.
Email: contactus@metro.com.vn
Tel: + 84 (0) 8 390 5190 3
Fax: + 84 (0) 8 373 5190 3.

IV. Target market:
Liquid milk segment of Vinamilk includes a lot of product lines that have ability
to meet needs and requirements of various and large number of consumers, such as: UHT
100% non-fat fresh milk, especially aims at people who are on diet or want to avoid fat,
Twin Cows 100% UHT milk imported targets customer segment that loves imported
products, fresh milk plus canxi low fat for lack of canxi or overweight people. Huge
demand for liquid milk results in high competition in this industry. Applying business - to
- business sale form, we choose supermarkets and schools as main customers to deal
with.
To supermarket, Vinamilk decides to corporate with Metro Corp because we want to
expand our distributors. Metro is one of the biggest wholesale traders in the world. By
2002, Metro decided to enter Vietnam market by establishing Metro Cash and Carry
Vietnam Company with the first center located in Ho Chi Minh City. Up to now, Metro is
the only wholesaler in Vietnam with 19 branches located in big cities and provinces
throughout Vietnam.
To schools, we aim at boarding school systems throughout Vietnam by demonstrate to
these venues and facilities milk demonstration to students ‘meals at schools, showing the
influence of milk to students health care and height growth that attracts participants.
V. SWOT Analysis
Strength
1. Having a long history and strong foundation makes VINAMILK become the
biggest brand in the daily product industry and VINAMILK does not do their
business only in domestic market, but they also does in 37 foreign countries.
2. Modern technology and machine system are used to produce the best quality
products from milk which are reached the international standard. VINAMILK has
the ability to produce variable types of milk products; therefore they have a
diverse product list in order to satisfy the customers’ demand in Vietnam.
3. VINAMILK also develops its distribution system and expands into nationwide
range, include: 266 exclusive distributors, more than 224000 retail outlets and
directly sells for over 600 supermarkets in domestic. Moreover, the company has
export into different countries in the ASIA and all over the world.
4. The experienced Research and Development department cooperates with the
leading Research companies to advance the best quality products to meet the
variable demand of customers in different group of ages.

5. Applying modern technology in Enterprise Resource Planning from producing,
qualify management to the circulation and distribution of commodity stage.
6. The operating managers have the ability and experiences in milky production that
have strong attachment to the company for years, understanding the market and
consuming trend in Vietnam.
Weakness
1. The materials are conditional on import resources because the national milk
resources was satisfied only 30% of the producing demand. Therefore, the
consistency in supply and price depends on the international supply – demand
relationship.
2. The big and continuous development in years unintentionally creates stress for the
new managers and employees.
3. Newly researched products are not published to the market.
4. The breeding productivity is lower than the general standard and high price of
milky materials also influences the profit.
Opportunity
1. Average consuming rate in milk market in Vietnam is lower than in other
countries in area and in the world. Special products for special use have not
been produced by domestic producers, while the price of exporting materials
is too high. So, the company has opportunity to grow up in long term strategy.
2. Expand and diversify the domestic distribution system: offering more retail
outlets, developing store chain to introduce new products to customers.
3. From now on, VINAMILK has exported to other countries and contributes 14%
of total turnover in economy. However, the company still has chance to
expand the sphere of business.
Threat
1. There is more competitive in milky market, especially with the famous
international brands.
2. Commitment of the Vietnamese government about reducing taxes leads to the
cutthroat competition between businesses: large foreign corporations have
opportunity to participate in the market.

3. Low income also affects consuming rate
4. The world economy influences the consistency of pricing and materials supply in
the future and it may out of control of VINAMILK
VI. Competitive Analysis
The competition in the market segment of fresh milk is increasingly fierce
because there are a lot of redoubtable rivals. Locally, the strongest rival of Vinamilk is
none other than Dutch Lady, followed by the Hanoi milk and TH True Milk are as new
players in the fresh milk market for children segment, which seems like potential big
rivals in recent years. Besides, Vinamilk is also being challenged by imported products
following WTO accession commitments. Due to Dutch Lady is supported by capital
inflows from its holding company so it does not have the same need to maintain
profitability. Therefore, its competitive strategy is more flexible than Vinamilk.
The first argument is in terms of the distribution channels; an extensive distribution
channel is an important growth aspect for companies to build a major barrier towards
several new entrances. In particular, Vinamilk has the largest distribution channel with
approximately 250 exclusive distributors and more than 24,000 retailers throughout the
country, while Dutch Lady builds the second largest dairy distribution network with 145
distributors and Nestle with only around 95 distributors nationwide.
About the purchasing power in raw material inputs, Vinamilk is leading in buying raw
milk in the country, purchasing up to 50% of the total indigenous production, while
Dutch Lady is the second largest raw milk buyer with approximately 20% of local fresh
milk. Nestle and at least 17 other companies account for the remaining 30% of local fresh
milk supply. However, Vinamilk meets a serious problem in the purchasing price of fresh
milk from local farmers. According to the article on The Saigon Times webpage, the
original milk price of Vinamilk is lower than Dutch Lady. Vinamilk’s buying price is
only VND7,000 per kilogram at 50 cow-raising families in the country, while the current
price offered by Dutch Lady is VND7,500 per kilogram. Moreover, the commission or
bonus for the farmer of Vinamilk is quite low while the bonus policy of Dutch Lady is
maintained frequently. Dutch Lady takes care more beneficial to their farmers who are
facing huge difficulties due to the rising production cost, while Vinamilk tend to cut into
farmers’ benefits and send many farmers into hardship through purchasing fresh milk
with the lower price.
Thirdly, the market share is the most important factor that decided the success of
Vinamilk today. As it requires no refrigeration and has a long shelf life, UHT milk is the
dominant product.
Vietnam, such as flavored and UHT milks. Although Vinamilk has larger capacity with
507,406 tons per year, there is no big difference in market share between Vinamilk and

Dutch Lady. According to the Source of Dairy Vietnam year 2010, the market is very
concentrated and 60% of the market share belongs to Vinamilk and Dutch Lady with
36% and 24% respectively. Milk imported from companies like Mead Johnson, Abbott
and Nestle accounted for about 21% market share. And the remaining 19% shares of the
approximately 20 dairies are small size as Nutifood, Milk Hanoi, Ba Vi and so on.
VII. Customers need:
Customers are an important factor for the survival and development of vinamilk.
We continuously improve products and services through to meet customer needs to
ensure the comfort and satisfaction when using the product vinamilk.
 Organizing workshops for clients to advertise a new product, a short
survey for them to collect some experience when they use the product. we
will create the survey for comments or feedback from customers to
improve their products in bad aspects and we will develop the best
aspects of the product for creating the best products.
 Creating relationships by using membership cards for loyalty customers.
When they buy products at the store or the product vinamilk distribution
system will be discounted by 20% and they will be receiving gifts gifts
when they purchase products in bulk and special occasions.
a. On the other hand, employees will also be trained knowledges as
professional experience, knowledge and soft skills so employees can
communicate better to answer customer questions about products and
services of Vinamilk when they are buying products. They will know how
to quickly solve problems and they will solve promptly in simple
situations.
VIII. Sales opportunities:
Currently Vinamilk has two distribution channels to deliver products to
consumers:
Distribution through traditional channels (includes 220 independent distributors and over
140,000 retail outlets) distributing more than 80% of the company’s products. To support
its distribution network, the company has opened 14 showrooms in the big cities like
Hanoi, Danang, Ho Chi Minh and Can Tho, etc. Distribution through modern channels
(such as supermarket, Metro, etc): The advantage of the company is having a wide and
strong distribution network, through the dairy factories invested in many places spread
throughout the country; with 1,400 level-one agents as well distribution network spread
across the country with 5,000 agents and 140,000 retailers and the other direct
distribution channels such as schools, hospitals, supermarket, etc..

First of all, we sell products with the client, we will have many different opportunities
such as creating long-term relationship with client. Many companies in Vietnam, they sell
with cheap price and make more promotions but our client who is still choose
VINAMILK because they believe about our quality. On the other hand, we also create
constant revenue resource with this client because they buy more and are often willing to
pay more.
Secondly, The loyal customers are typically repeat customers. This means that these
people will return to on particular company and buy again, resulting in a steady income
for that business. Loyal clients also typically recommend their favourite companies to
family and friends, which bring in more business. Besides, an increase in keeping
customers can promote our bottom-line profit by 25% to 100% depending on our fixed
costs.
Finally, saving money but effective with world of mouth. When loyal client and customer
to use or buy product of VINAMILK, they feel better than others, they will tell with
everyone about that product line by word of mouth. Therefore, VINAMILK will attract
different client resource and creative belief from customers about VINAMILK’s brand
everywhere.
IX. Sales strategy:
No1:
Knowing that almost all families have chosen supermarkets as their shopping
places recently because supermarkets not only ensure the goods quality but also offer
reasonable prices compared with traditional distribution channels as markets. With Cash
and Carry style (customers pay in cash and self-transport), Metro has taken part in
Vietnamese market with the target “distributing business and retailers only”. Metro is
appropriate with marketing objective that VINAMILK desires to reach up to 60% local
market share of fresh milk the upcoming year. To the mutual beneficial agreement,
VINAMILK is eager to cooperate with Metro to make Metro trademark to come closer to
its customers through new and popular product lines of VINAMILK. Besides,
VINAMILK can increase the sales figures, make sure output quality and easily control
business operations before the products are handed over to consumers through POS
(Point of sales), including Metro’s outstanding administration software. These are some
benefits Metro can obtain when cooperating with VINAMILK. Comparing with Dutch
Lady and TH True Milk, strategy of VINAMILK is that should Metro agree to let
VINAMILK in with the large number and make payment with in one week, VINAMILK
will offer them 15% discount of the sales value. If Metro can’t afford to make payment or
pre-paid, VINAMILK will also let the company make short-term debts with the lowest
interest rates. Instead, Metro will help VINAMILK display the cargo at the best location
and give them the priority to demonstrate VINAMILK products with customers. In

upcoming haft year, VINAMILK will apply special deals for customers shopping at
Metro only. This promotional deals will be quarterly divided but in different ways.
From April to June, to prepare for International Children’s Day June 1th, VINAMILK set
up gift-offer programs when customers buy fresh milk products in Metro with the invoice
of more than 200,000 VND. Those who are with children will be given a nice teddy bear,
printed the logo of VINAMILK – Metro co-operation and have opportunities to get 10
scholarships of 5 millions VND.
From July to September: set up booths that serve VINAMILK fresh milk free of charge,
not only increase sales figures for two parties, but also help customers to know more
about VINAMILK by sharing children health care experience before upcoming
examinations.
From September to December: work with Metro to set up “Milk funds for Vietnam”,
“Care for Vietnamese children’s future”, give milk and warm clothes for poor children in
need in remote areas.
From January to March: VINAMILK products will be packed in big parcels with all
kinds of milk suitable to each family member, selling at Metro only.
Moreover, customers will be given gift vouchers when buying goods at Metro with point-collecting
programs if buying VINAMILK package here.
No2:
The second potential market of VINAMILK to develop the sales plan which tend
to some boarding schools in the country. Our marketing team researched that the purpose
of the boarding school in the city that they are very concerned about health problems of
their students, VINAMILK will implement the plan for the distribution of milk for the
boarding school in the city. Compared with Dutch Lady or TH True Milk, one of the
strongest competitive advantages of VINAMILK is its old brand. VINAMILK’s
reputation has a sustainable development in the domestic market nearly 40 years. These
are some benefits that the schools could get when they cooperate with VINAMILK. If
schools accept to order VINAMILK products in large quantities and pay off in 1 week,
the VINAMILK will discount 5% of value of goods. Additionally, the milk cartons were
used; VINAMILK will purchase and bring to recycle. The money from the purchase
process will deducted by 1% in the sale cost. This is the sales strategy of mutual benefit
to both parties, VINAMILK will bring milk cartons to recycling into new products so
schools can teach their students to know how to protect environment. VINAMILK will
deliver with benefits such as gifts including milk, school supplies for students ...
depending on quarter. Moreover, VINAMILK also organize some promotions for schools
to build long-term relationships.

From July to September, VINAMILK supports students who face difficult circumstances
in their life by several valuable scholarships on the occasion of the new school year,
organize the free health care for all students in high schools.
From April to June: students have to take a lot of exams in this period, then VINAMILK
offer leaflets which contain necessary information about regimen for students to ensure
that they remain the best health condition. Additionally, VINAMILK offer 180ml fresh
milk for each student on the exam days.
X. Communication plan:
Indirect communication (via mail, letters...):
_Metro: Send letter of introduction about the company and the cooperation plan, so
Metro can learn and consult before deciding to cooperate. On the other hand, the previous
mailing also help companies save time and still understand the gist, but will hardly
uniform opinion. Need to have a meeting after finding out information and make
decisions, sign contracts.
_ The Boarding School: send mail introducing products that the company will provide to
the schools, and the benefits that will be enjoyed school when cooperation. The school
will have time to consider the terms on which the company launched. The two sides will
be meeting to discuss cooperation and provide appropriate direction
Direct communication (meetings, telephone, presentations ...):
_Metro: Vinamilk representative will contact directly with the management of the Metro,
introduce product and discuss the benefits of both parties. There should be more meetings
to make the final decision. This takes time, but the two sides to achieve high efficiency.
_ The Boarding School: Talking to the representatives of the school to introduce our
company and products. There is a showcase of the products and the products suitable for
each age. Spend a nday in an agreement and signed a contract with the school

XI. Financial forecast:
Balance Sheet
2013 2014 2015
Current Asset 12,415,939 12,621,027 12,784,634
Long-Term Asset 9,466,984 9,486,300 9,560,897
Total Asset 21,882,923 22,107,327 22,345,531
Liabilities 4,498,116 3,497,656 2,497,657
Owner's Equity 17,384,807 18,609,671 18,674,532
Total Resources 21,882,923 22,107,327 21,172,189
In come Statemen t
2,013 2,014 2,015
Sales 6,863,710 7,114,392 8,564,987
Less Deductions 141,001 153,808 171,300
Net Sales 6,722,709 6,960,584 8,393,687
Cost Of Sales 4,285,765 4,587,602 4,378,524
Gross Profit 2,436,944 2,372,982 4,015,163
Net Operating Profit 1,838,932 1,667,907 1,567,985
Profit Before Tax 1,862,007 1,707,657 1,865,478
Business Income Tax 337,682 346,426 33,579
Net Profit 1,524,325 1,361,231 1,831,899

Required Resources
“Metrol group report”. Retrieved December 18, 2010 from
http://www.metrogroup.de/internet/site/metrogroup/node/11163/Len/index.html#top
(n.d.) Retrieved June 10, 2003 from
http://www.metro-cc.com/internet/site/mcc/node/MCC_HOME/Len/index.html
“Vinamilk grilled over fresh milk buying price”. Retrieved March 26, 2009 from
http://english.thesaigontimes.vn/1138/Vinamilk-grilled-over-fresh-milk-buying-price.html
“Những thay đổi tích cực của thị trường sữa Việt Nam”. Retrieved January 19, 2008 from
www.dairyvietnam.org.vn
“Examples of strategical objectives”. Resources. Retrieved July 18, 2012 from
http://onstrategyhq.com/resources/examples-of-strategic-objectives
“Vinamilk’s SWOT Analysis”. Retrieved October 2, 2007 from
http://www.vinamilk.com.vn/uploads/Download_E/20140415_VINAMILK_AR2013-
EN.pdf

Vinamilk strategic account business plan

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