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UNIVERSITY OF ECONOMICS AND FINANCE HO CHI MINH CITY

SUBJECT: MARKETING CHANNEL MANAGEMENT FINAL REPORT: THE MARKETING CHANNEL

Lecturer: Nguy n Th<b>ễị Ngọc Dung </b>

Class: 231.MKT1127E.A01E

Ho Chi Minh City, 20/10/2023

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LIST OF GROUP MEMBER

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Figure 1: Traditional fish sauce Cố Nhỉ ... 2 t

Figure 2: Traditional fish sauce Siêu Hạng .... 3

Figure 3: Traditional fish sauce Cao Đạ ... 3 m Figure 4: Traditional anchovy fish sauce ... 4

Figure 5: Ngư Vị anchovy fish sauce ... 4

Figure 6: Bay Hong Hanh channel ... 6

Figure 7: B y H ng H nh Channel ả ồ ạ ... 11

Figure 8: E-commerce Channel ... 11

Figure 9: General Trade Channel ... 11

Figure 10: Statista about the rate of online shopping ... 13

Figure 11: Our Survey ... 34

Figure 12: Contacting manager distribution by our team ... 35

Figure 13: Post on Facebook ... 36

Figure 14: H ng H nh on Shopee platform ồ ạ ... 37

Table 1: Direct Competitors ... 10

Table 2: Indirect Competitor ... 10

Table 3: Service Output Demand ... 15

Table 4: Function in General Trade ... 21

Table 5: Function in E-commerce ... 25

Table 6: Service Gap for General Trade ... 29

Table 7: Service Gap for E-commerce ... 30

Table 8: Cost Gap for General Trade ... 31

Table 9: Cost Gap for E-commerce ... 32

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First of all, our team would like to express our sincere thanks to Mrs. Nguyen Thi Ngoc Dung

of the Marketing Channel Management class, who enthusiastically taught, imparted knowledge as well as helped, and guided us to the end love for us during the course. That dedication has helped us to have more interesting experiences in the subject and successfully complete today's report.

Besides, I would like to thank all members of the group for their companionship, cooperation, and best efforts until the research is completed. As well as the members of class A01E, for listening, contributing, and building ideas to help our group improve on the shortcomings of the group's topic.

However, our group's report still has many shortcomings in the implementation process because of its immaturity in professional knowledge and limited practical experience, so we hope to receive your contributions from teachers so that the group can improve those shortcomings and complete the research paper in the best way.

Finally, we are very grateful and grateful to the school for creating conditions for us to have more opportunities to collide, contact with reality and from there learn many new things in this subject. At the same time, it helps us to apply useful practical knowledge through the subject Marketing Channel Management.

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Hong Hanh fish sauce is one of Vietnam's oldest brands of fish sauce. Hong Hanh fish sauce's market share increased significantly between 2009 and 2013, however with changes in society and consumer preferences, this product slipped into a condition of unstable brand recognition in the domestic market. The major issue is due to the brand's distribution channel management, which results in items not reaching the people when compared to young companies.

We discovered concerns in the cost gap and service gap after examining the present channel. From there, we presented a "Make" or "Buy" orientation for firms, as well as ideas tailored to the specific circumstance.

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Distribution channel management is a critical strategic component of providing items to end consumers. However, some businesses continue to have distribution channel issues, resulting in items being brought to market that do not efficiently reach customers. Hong Hanh sauce fish is one such example. Even though it has been in the market for a long time, its brand awareness is still low when compared to other contemporaries and emerging businesses.

The study team has significant points concerning the case of Hong Hanh fish sauce - circling around the issue of cost gap and service gap in the distribution channel system, particularly General Trade and E - commerce - based on practical investigation and analysis the true scenario.

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CHAPTER IV: CURRENT CHANNEL ANALYSIS ... 11

CHAPTER V: END-USER ANALYSIS ... 13

5.1 End-user Segmentation: ... 13

5.2. Targeting End-users by Service Output: ... 14

CHAPTER VI: CHANNEL ANALYSIS ... 16

6.1 Marketing function in General Trade: ... 16

6.2 Marketing function in E-commerce:... 22

CHAPTER VII: THE EFFICIENCY OF MARKETING CHANNEL ... 26

7.1 General Trade Channel: ... 26

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CHAPTER VIII: GAP ANALYSIS ... 28

8.1 Service gap analysis: ... 28

8.2 Cost gap analysis: ... 30

8.3 Key Finding ... 32

8.3.1 General Trade ... 33

8.3.2 E-commerce ... 36

CHAPTER IX: MAKE - OR BUY ... 38 -

CHAPTER X: DESIGN MARKETING CHANNEL OF HỒNG HẠNH FISH

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CHAPTER I: THE COMPANY OVERVIEW

1.1 Company Information:

The Hong Hanh brand is a long-standing fish sauce of Bay Hong Hanh Service Trading Production Co., Ltd, which was founded in 1986 and has grown with the country's integration. The firm uses fresh raw materials fished off the coast of Phu Quoc and has a closed, sophisticated manufacturing process.

1.2 About History:

1986, established Bay Hong Hanh Service Trading Production Coconsec. 1993, exported to Japan and Taiwma.

1998, honored to be voted by consumers as High-Quality Vietnamese Goods for many consecutive years.

2003, processing and manufacturing separate products for Mega Market supermarket.

2007, completed HACCP and ISO 9001 integrated quality management system. 2015, achieved Halal certification, fully meeting the most stringent.

requirements for food safety according to Islamic standards.

2016, certificated by FDA (United States) that the product meets export standards for the US market.

2017, one of the first businesses to receive the title of high-quality Vietnamese goods with integration standards.

2019, change to new brand identity. Modern, and luxurious but still retains typical traditional features.

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CHAPTER II: THE PRODUCT OVERVIEW

2.1 Product:

Hong Hanh sauce fish comes in five varieties: Traditional fish sauce Cốt Nh : ỉ

Use: Specifically designed for scoring

C t Nh are the first droplets of traditional fish sauce produced after 12 - 16 ố ỉ months of fermentation in hardwood barrels with charcoal anchovies and fine salt

Cốt Nhĩ preserves the most authentic, rich, and delectable flavor of traditional Phu Quoc fish sauce

Traditional fish sauce Siêu Hạng:

Use: Specifically designed for dipping raw meat with seasoning. <small>Figure 1 Traditional fish sauce C t Nh: ốỉ </small>

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Siêu H ng fish sauce is made completely with Phu Quoc charcoal anchovies ạ and Ba Ria Vung Tau fine salt, and it contains all natural nutrients, making each meal not only seductively tasty but also healthy.

Traditional fish sauce Cao Đạm:

Use: Specifically used for marinating and cooking.

Cao Đạm fish sauce includes a high concentration of natural amino acids, which assist to excite taste receptors and give flavor to each meal.

<small>Figure 2 Traditional fish sauce Siêu H ng: ạ</small>

<small>Figure 3: Traditional fish sauce Cao Đạm </small>

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Traditional anchovy fish sauce:

Uses: Specifically used for marinating and cooking.

Each drop of Anchovy fish sauce includes a high concentration of natural amino acids, which excite the taste buds and give flavor to any meal.

Ngư Vị anchovy fish sauce:

Use: Seasoning, braising, and cooking.

Ngu Vi is the ideal alternative for making family dinners more tasty and appealing by offering moderate and economical costs while yet retaining the flavor of traditional Phu Quoc fish sauce.

Figure 4: Traditional anchovy fish sauce

<small>Figure 5: Ngư Vị anchovy fish sauce </small>

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Traditional anchovy fish sauce 500ml: 72.000 VND

Ngư Vị anchovy fish sauce: 900ml: 36.000 VND 4,9 lít: 112.000 VND

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General Trade:

Traditional markets and grocery stores around the nation sell Hong Hanh fish sauce, with the largest markets being Ho Chi Minh City, Vung Tau, Binh Duong, Binh Phuoc, Dong Nai, Tay Ninh, and other regional provinces Southwest

Furthermore, Hong Hanh continues to grow and promote the Northern market Modern Trade:

Horeca:

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Export:

Hong Hanh fish sauce is now exported to the following countries: Japan, Taiwan, the Philippines, Singapore, and European and North American nations (France, Canada)

2.4 Promotion:

For end-users:

In 2019, Hong Hanh Company started a marketing program for end-users at Co.op Mart supermarket. Most promotions are performed for Modern Trade and E-commerce channels, while General Trade is rarely used.

On certain occasions, use promotions.

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For retailers:

3% discount on orders of 3,000,000 VND or more for shops (according to Binh Tan agent, 116/2 Le Dinh Can, Tan Tao, Binh Tan, Ho Chi Minh City).

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Tinh túy hương vị trăm năm

Company MASAN GROUP JOINT

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CHAPTER IV: CURRENT CHANNEL ANALYSIS

Channel Diagram

<b>→ PICK: GENERAL TRADE and E-COMMERCE</b>

<small>Figure 7: Bảy Hồng H nh Channelạ</small>

<small>Figure 8: E-commerce Channel </small>

<small>Figure 9: General Trade Channel </small>

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REASON: Focus on these two channels because there are many problems in the distribution channel system compared to the remaining channels, which affects the way the product reaches end-users in the market.

→ Hypothesis about Hồng H nh Companyạ Advantages:

Hong Hanh fish sauce has been produced since 1986, this is a long-standing brand and certified for food quality from the state.

Hong Hanh sauce fish's distribution channel has wide coverage in traditional channels and E-commerce. This makes it easy for customers to find brand products at key markets in Ho Chi Minh City, as well as easily place orders at E-commerce platforms. Hong Hanh sauce fish's distribution channel promotes exports compared to the domestic market.

Although the channel has wide coverage, brand awareness is poor, the brand does not run much advertising, mainly uses the word-of-mouth method.

Product discounts for agents and retailers are unstable, so the products are not sold for a long time in key markets.

There are few promotions for General Trade, but promotions for E-commerce channels often follow holidays.

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CHAPTER V: END-USER ANALYSIS

5.1 End-user Segmentation:

Bay Hong Hanh segments customers into 2 main groups based on purchasing behavior: Online buying trend and direct purchasing at the store. (Modern women and Traditional women).

Since the pandemic two years ago, consumer behavior has changed quite a bit. Customers use e-commerce platforms to shop more.

Specifically in the sauce industry, data from Statista shows that in 2020, 0.5% of revenue will come from online but by 2023 it will be 1.1%, 1.5% in 2024 and 2% in 2020. 2025. This is an opportunity for Hong Hanh to reconsider investing in e-commerce channels to expand the market and compete with competitors. However, more than 97% of revenue will still come from offline channels, so Hong Hanh should improve the quality of channel operations to meet a large amount of market demand and compete with competitors.

Main concern: They are people who care about their personal interests, like to enjoy a quality life, they believe in using reputable products with quality assurance on health safety.

<small>Figure 10: Statista about the rate of online shopping </small>

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5.2. Targeting End-users by Service Output:

Segment name

Descriptor ^Level_demand Descriptor ^Level_demand

Spatial Convenience

“I often cook so I want to have fish sauc immediately when need it.”

"I think I don't care whether the buying

"I want to have man choices for the product want to buy, maybe won't find it or it will be out of stock when I go t many product line because I want to kno more products instea of just one type.”

"I want to clearly understand the necessa

whenever I have questio about products or qualit problems."

Bulk Breaking

“My house is near the market so I don't nee to store a lot of fish sauce.”

"I think if you have ordered, you should ord more than one product be able to apply discou codes or use promotion policies from the store."

Medium

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Delivery/ Waiting Time

“I don't urgently need a bottle of fish sauc right away, because can buy it when I go t the market or at th grocery store, becau I often pass by thes places."

"I chose to purchase o the e-commerce platfor and I accept that th delivery time to my hom may take longer tha expected."

<small>Table 3: Service Output Demand</small>

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CHAPTER VI: CHANNEL ANALYSIS

6.1 Marketing function in General Trade:

Physical possession

(1) The manufacturer has warehouses to store packaged fin products at two warehouses: Cu Chi (37 Street 142, Hamlet 8, My Commune, Cu Chi District, Ho Chi Minh City), Phu Quoc (1 Nguyen Trung Truc, Quarter 8, Duong Dong, Phu Quoc). (1) The fish sauce warehouse distributed from manufacture distributor is located at the warehouse in Cu Chi, Ho Chi Minh with an area of 5,000 m2.

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

(2) In each area in Ho Chi Minh City, distributors have their o warehouses so they can replace manufacturers and distribute th wholesalers.

(3) Wholesalers store goods at their business locations. (3) Distributors provide and manage deliveries, distributors will b shipping costs and loading labor costs when delivering good wholesalers.

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(4) Retailers import goods through wholesalers, with large quan they will be delivered to your door and with small quantities they have to transport the goods themselves.

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

Ownership There are about 35 distributors in TP.HCM.

(1) Manufacturer manages more than 1200 containers in stock. (1) Hàng hoá t nhà s n xu t trong quá trình v n chuyừ ả ấ ậ ển distributors thu c quy n s h u c a nhà s n xu ộ ề ở ữ ủ ả ất.

(2) Each distributor keeps about 280 boxes in stock.

(2) Distributors who own their warehouses will bear the cost storing, and losing goods in the warehouse.

(2) Goods from distributors during transportation to wholesalers owned by distributors.

(2) If goods are delivered to wholesalers if there is breakag damage to the product due to the manufacturer, the goods w returned to distributors => Returned goods are owned by distribu (3) Goods in transit from wholesaler to retailer will be owned distributors.

(3) Goods, after being delivered to the wholesaler's store, wareh and after payment, will be owned by the wholesaler.

(4) When stored and inventory goods expire, the retailer will be s responsible.

Promotion (1) Manufacturer offers a 3% discount on wholesale invoices wholesalers and retailers over 3 million VND.

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(1) Manufacturer supports printing and construction of store n signs for retailers..

(2) After establishing a goodwill relationship between the distrib and wholesalers, the distributor will give an additional 1% disco for wholesale invoices over 10 million VND to wholesalers. (2) Distributors have preferential policies for wholesalers, w wholesalers buy 6 boxes of 500ml super quality fish sauce, they get 1 box of the same line for free.

(2) Distributors have preferential policies for wholesalers. W wholesalers buy 1 box of 900ml super quality fish sauce, the price be reduced by 20,000 VND for each box purchased.

(2) Distributors have a preferential policy for wholesalers. W wholesalers buy 8 1 liter boxes of fish sauce, they will get 1 free of the same line.

(3) Wholesalers offer promotions, discounts to retailers who goods in wholesale quantities and place regular orders. (5) The end user will be the direct recipient of incentives from brand through promotions for end users.

Financing (1) The manufacturer bears the cost of shipping returns from distributor.

(2) Distributors bear all costs of shipping and returning goods f wholesalers, provided that the wholesaler is within the distribu management area.

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