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<b>University of Economics and Finance </b>

<b>Nguyen Huu Thien Nguyen Thuy Linh Le Thi Kim Nhung Bui Van Tam </b>

<b>HCM CITY, DECEMBER 2022 </b>

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<b>GROUP 10 </b>

<b>completing the report </b>

Nguyễn Hữu Thiện Leader T T T T T T T T T 100% 10 Nguyễn Thuỳ Linh _member^Team T K T K K T T TB K 86,6% 8,7 Lê Th Kimị Nhung _member^Team K TB T TB T K K TB TB 75,6% 7,6 Bùi Văn Tâm _member^Team TB K T TB K K T K TB 77,8% 7,8

<b>(*): Đánh giá phần này theo quy ướ sao c </b>

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2. Targeting End-users by Service Output ... 6

III. On1’s Channel Analysis and Its Function ... 8

1. On1’s Marketing Channel ... 8

2. Functions of the Channel ... 9

3. Individual Channel Member’s with Efficiency Template ... 10

IV. Gap Analysis ... 11

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I. About the Company and the Product

<b>1. The Company </b>

- Lixco was established and operated since 1972 in Thu Duc district, Ho Chi Minh City with the main business of manufacturing synthetic detergents. During the development process from 1980 to 2003, the Company was under the management of the State after many times of name change and merger - separation. Established a branch in Hanoi. 27/06/2003, the company was transformed into Lix Detergent Joint Stock Company under Vietnam Vinachem Group. In 2013 signed a contract with Unilever.

- In 2019, launched the On1 brand - a premium product from nature.

- Address: No. 03, Street 02, Quarter 4, Linh Trung Ward, Thu Duc District, City. Ho Chi

<b>- </b> The On1 brand made in Vietnam by Lix Detergent Joint Stock Company was developed and created during the Covid-19 outbreak. On1 is considered as one of the leading disinfectant products trusted by consumers during the Covid-19 epidemic.

- Uses: Helps to clean hands, protect hands and surfaces such as tables and chairs, doorknobs, kitchen floors... from bacteria, limit and prevent infectious diseases. Add Aloe to safely moisturize the skin of the hands.

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<b>3. On1’s Competitors Direct Competitors – Lifebuoy (Unilever) </b>

- In 1894, Lifebuoy was born in the UK, and is now a part of Unilever group, with more than 110 years of development and trading in products to serve the essential needs of the family. They understand and capture user psychology, from which to offer products that match market needs at affordable prices.

- During the epidemic, grasping the urgency of the difficult epidemic period, they urgently launched the product "Antiseptic Lifebuoy" to assist consumers in protecting their own health and avoiding community infection.

<b>Indirect Competitors – Bath and Body Work </b>

- Bath and Body Works is a famous brand specializing in body care products from the UK. Their products are highly appreciated for their sophistication in terms of packaging design and product design. In addition, the "Quality" factor cannot fail to mention when talking about Bath and Body Works when they always bring very good and safe products to the health of consumers.

- In terms of health and beauty care, the line of hand sanitizer is one of the most "featured" products when it comes to the health segment of Bath and Body Works. The gentle scent and smooth feeling on the hands after use are special things that make customers loyal to this product line of Bath and Body Works.

<b>Competitive Advantage </b>

The overall design is all white, in the form of a tall, slim bottle with a spray nozzle, the red Lifebuoy brand logo is placed in the middle below the name of the product.

The overall design is all white, in the form of a tall, slim bottle with a spray nozzle, the blue ON1 brand logo is placed in the middle and below the name of

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II. End-users Segmentation and Service Output

<b>1.End-users Segmentation </b>

- On1 segmented customers into two main target groups based on purchasing behavior: Buying for personal use and buying for use by organizations and businesses. (Personal buyers vs Bussiness buyers).

- Main Concern: They are people who care about the health of themselves and those around them.

- Behaviours:

Purchased for personal use: People who need to meet many people in their daily work. (Students, office workers, ...)

Buy to use for businesses, organizations: Schools, organizations that work in departments, teams, ... need to keep the environment clean and bacteria, to avoid harming people's health.

<b>2. Targeting End-users by Service Output </b>

<b>Level ^Descriptor^DemandLevel </b>

<b>Bulk Breaking </b> “Many departments in the company need to use hand sanitizer frequently. Need to reserve the amount of hand sanitizer to use

Pocket spray design, colorful colors, diverse scent groups. Pleasant fresh produce. The product is suitable for travel, convenient for hand washing immediately after contact with public surfaces.

Pocket spray design, colorful colors, diverse scent groups. Pleasant fresh produce. The product is suitable for travel, convenient for hand washing immediately after contact with

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<b>Spatial </b>

<b>Convenience </b> ^{“Many things need to be}solved, so there won't be enough time to select and

<b>Time </b> ^{“We do not necessarily}receive the goods immediately because there are still a few bottles of hand sanitizer left in

<b>Assortment/Variety </b> “Quality products are our

top priority” ^High ^{“I just want to buy}hand sanitizer, any kind”

Low

<b>Customer Service </b> “We need advice on pricing and need help with shipping”

Medium “I don't need any help because I can make up my own mind”

Low

<b>Information </b>

<b>Sharing </b> ^{“We are very interested in}product information, product quality and how to use hand sanitizer to

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III. On1’s Channel Analysis and Its Function

<b>1. On1’s Marketing Channel </b>

- In the distribution channel system of On1 (Lixco) there are 5 main distribution channels: § Traditional Channel (GT): Grocery stores, Kios in the market, drug stores, ..

§ Modern Channel (MT): Convenience stores (CircleK, Mini Stop, Winmart, ...); Supermarkets (GO!, CoopMart, Lotte Mart, ...)

§ E-Commerce Channels: Shopee, Lazada, …

§ Horeca channel serves products for Restaurants, eateries, … § Export Channel

- Regarding distribution channels, in general, the traditional distribution channel (GT) is still the main channel, accounting for 44% of total product sales, followed by the modern channel (MT) with 37%. Since the pandemic, the consumer behavior of customers has changed quite a lot, since then, E-commerc platforms have developed strongly and are also potential platforms that Lixco is exploiting.

- To analyze more specifically about On1 product distribution channel (Lixco), the team will choose the Traditional distribution channel (GT) branch to clarify this channel.

- In On1's Traditional distribution channel (GT) system, they have 2 main intermediaries involved in the distribution process, namely Distributor and Retailer. And they apply the Level 2 Distribution Channel model to their products.

- According to the current regulations of the company, there are currently 63 provinces and cities in the country, each province has 1 distributor. The Company's products will be shipped to the provinces and delivered to the distributors. From there, products can be sold directly to Pharmacy (retailer) (Department stores, market kiosks,...). And finally to the consumer.

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- Because there are many types of Pharmacy (retailer), I will do a deep analysis of the GT channel's pharmacy distribution channel.

- Currently, On1 hand sanitizer is distributed in GT channel to pharmacies through: + 152 branches of An Khang pharmacy in Ho Chi Minh City.

+ 124 branches of Pharmacity pharmacies in Ho Chi Minh City. + And 500 other retail pharmacy branches in Ho Chi Minh City.

<b>2. Functions of the Channel </b>

(1) Warehouse with an area of 1000 square meters in Lot A6-A12, Dai Bang Industrial Park, City. Thu Dau Mot, Binh Duong province.

(2) Distributor has an average warehouse area of about 200-300 square meters (3) Pharma cy will stock inventory directly at retail stores

(1) Manufacturer will work and ship the goods to the distributor by their own means or the shipping company will assist in the transportation -> Manufacturer will bear the cost of storage and delivery

(3) Distributor supplies and manages the delivery of goods to pharmacy -> The cost of storage and delivery will be borne by the distributor

(4) End-users will go to retail stores to purchase and pay directly

There are about 30 distributors in TP.HCM

• (1) Manufacturer manages more than 1200 containers in stock • (2) Each distributor keeps about 600 boxes in stock • (3) Each pharmacy has 10-50 boxes of goods in stock

Manufacturers, distributors and pharmacy (retailer) who own their warehouses will bear the costs of storing, storing, and losing goods in the warehouse.

(1) Year-end program 50% off for 1 bottle of On1 quick hand sanitizer

(1) When buying 1 bottle of 500ml quick hand sanitizer, you will get 1 free product of the same type.

(2) If Pharmacy (retailer) sell the quantity of 2 boxes/week, the distributor will sponsor more banners and display shelves.

(2) The distributor's salesperson will be the person who works directly with the Pharmacy (retailer). They will have to receive the order quantity from the retailer and calculate the quantity to deliver the order to the retailer.

(2) The delivery staff of the distributor will be the person who directly delivers the goods to the pharmacy (retailer) through the delivery vehicles.

(3) Pharmacy (retailer) they will have to work directly with customers or will have sales staff to advise and assist customers in the product selection process.

(4) End-users will be the ones to directly enjoy the incentives from the brand through promotions for end-users.

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<b>3. Individual Channel Member’s with Efficiency Template Importance weight for </b>

<b>functions: ^{Proportional Function Performance of}Channel Member </b>

(1) Manufacturer bears the cost of shipping returns from the distributors. (1) Manufacturers discount about 10% commission to distributors.

(1) Distributor must be under pressure to pay from the manufacturer within 15 - 30 days through the negotiated contract.

(2) Distributor bears the cost of shipping returns from the pharmacy (retailer) (3) Retailer is under pressure to pay from the distributor within 15 - 30 days of the negotiated contract.

In addition, Lixco is also authorized to sign loan contracts and guarantee credit extension at Vietinbank Thu Duc Branch.

(1) Manufacturer will have to bear the costs of damage, insurance of the goods when transported to the distributors.

(3) The pharmacy (retailer) will bear the costs when the product is defective, damaged or deformed during transportation to the customer.

(4) In the course of use, if spillage or damage occurs due to failure to ensure preservation requirements, the end users- must be responsible.

(1) Manufacturer will trade and receive orders through a contract with a distributor. (2) Distributors may go directly to the point of sale of regional Pharmacy (retailer) and from there the retailer will place orders directly with the distributor.

(3) The end-users will go directly to the retail stores or can order via phone call.

<b>Information sharing</b>

(1) Lixco's official website and fanpage will be the official source of full information about products so that customers can easily find out.

(3) Consulting with customers directly at retail stores (grocery, pharmacies, ...) (4) End-users will be the one to directly use the product and give their own views, opinions and evaluations about the product. From there, maybe they will introduce to relatives and family about the product to use together.

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<b>The Efficiency Template </b>

IV. Gap Analysis

- For Business Buyers, they need to buy products in sufficient quantity to use for their entire organization, or business, so their demand for goods is relatively large. And with the current situation of the distribution channel, they provide the quantity of goods in individual units, and with the Business Buyer they do not want to buy in odd quantities. (SS > SD)

- For Personal Buyers, they only want to buy a few retail products just enough for daily life. Pharmacy meets the needs of this end-user. (SS = SD)

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<b>Spatial Convenience </b>

- Both of these end-users are satisfied. Since the number of Pharmacy (retailer) selling On1 products is relatively common, it will be more convenient to find and buy their products. (SS = SD)

<b>Delivery/Waiting Time </b>

- With Business Buyers, they need to stock up on the required quantity so they will order first. Therefore, the delivery time does not need to be immediate, they can wait to receive the goods. (SS > SD)

- Because of the necessity in daily life, when consumers choose to buy products at Pharmacy (retailer), they want to have the goods right at the checkout instead of having to wait. (SS = SD)

<b>Assortment Variety </b>

- Because the retail locations in the GT channel are small Pharmacy (retailer), if the target audience is Business Buyers choosing to buy from Pharmacy (retailer) in the GT channel, they will lack diversity in choice. With Business Buyer, they care more about the quality and price of the product, so they need to have many choices to consider. (SS<SD)

- They only need to buy a type of hand sanitizer to use, so they do not need to choose and consider between many product brands. They can browse through some of the products available at the retailer and buy them right away. (SS=SD)

<b>Customer Service </b>

- Most Pharmacy (retailer) will not provide too much service to their customers because their resources are not enough.

- With Personal Buyers, they themselves do not need service when buying, they just want to see and make their own decisions. (SS=SD)

- With Business Buyers, they expect to be supported in terms of freight forwarding, as well as advice on prices. (SS<SD)

<b>Information Sharing </b>

- Because they buy goods in large quantities, they are very concerned about product information, safety and authenticity of such information. Therefore, Pharmacy (retailer) will hardly be able to convey all the information of the product to end-users and find it difficult to build trust in the Business Buyers audience. (SS<SD).

- And for the Personal Buyer, they usually only care about the brand of the product, so they can almost decide for themselves which product they choose to buy (SS=SD).

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customer care system through fanpage and

customer care system ^CustomerService ^{Build a complete}customer care system through fanpage and V. Make and Buy Channel Analysis

- In the existing distribution channel system of On1 (Lixco), they apply both forms: Vertical Integration and Outsourcing Channel in their distribution strategy:

About Vertical Integration:

- They own 2 separate factories to produce 2 different types of manufactured products

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