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HO CHI MINH CITY UNIVERSITY OF ECONOMICS AND FINANCE

FINAL REPORT

SUBJECT: PRODUCTS MANAGEMENT

LECTURER: LUU THANH THUY TOPIC: LANH GROUP: NUMBER 1

CLASS: A05E

Nguyễn Như Nhi Trang 215048129 Hoàng Thị Mỹ Huyền 215047769 Nguyễn Ngọc Thảo Trân 215047935 Nguyễn Thị Kim Ngân 215084378 Nguyễn Bảo Anh Thơ 215047899

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<small>1.2.</small>! <small>POSTER S& IVE& ORCES’ FF:)...</small>

<small>1.3.</small>! <small>DIRECT&COMPETITOR:&WABISABI& ÔI& UÊ&GROUPXQ.)...</small>

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I. Executive summary

1. Our product:

This report focuses on the product development process from the initial idea to achieving success with impressive revenue during the 3-day "Lanh" event. Throughout this process, we have created a total of 3 main products.

Product 1: Spaghetti with vegetable sauce Product 2: Plant-based Bun Cha Product 3: Kumquat tea

2. Vision and mission:

Vision: To create a world where plant-based products are not just a temporary trend but an essential part of people's daily lives. We believe that choosing and consuming plant-based products can bring positive changes to individual health, the environment, and the future direction of the food industry.

Mission: To be a pioneer in innovating and developing high quality, appealing, and -delicious plant based products while ensuring that they meet the full nutritional needs.

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-A. Core values: HESI

Healthy: Our plant-based meals are designed to provide balanced nutrition, supplying essential nutrients and contributing to overall health. We strive to create not only tasty dishes but also promote a balanced and healthy lifestyle.

Excellence: We are committed to delivering excellence in every meal we create. Our plant-based meals are meticulously prepared, using high quality and organic ingredients to -provide a perfect combination of flavors, presentation, and dining experience.

Sustainability: We aim for sustainable environmental development. From selecting environmentally friendly ingredients to implementing neat paper packaging and reducing waste, we consistently make efforts to create meals that support a healthier planet.

Integrity: Transparency, honesty, and ethics are the foundation of our work. We pledge to provide customers with accurate information about our ingredients, sourcing, and production processes.

3. Our Team

Our team is formed by 5 representatives from different departments within the company. Each member of the team has specific roles and responsibilities, accompanying each stage of the product development process. We believe that clarifying the roles and obligations of each team member is crucial to minimizing risks within the team. To ensure efficiency and optimal coordination, we apply the RACI method (Responsible, Accountable, Consulted, Informed). This is a responsibility management approach that helps define the roles and responsibilities of each member in the work process.

The "Responsible" role identifies the person directly responsible for specific tasks and activities in each stage of the product. They are accountable for executing and completing the work as required.

The "Accountable" role is the ultimate responsible person for the success of the product. They ensure that all tasks are performed on schedule, meet the quality standards, and achieve the set objectives.

The "Consulted" role refers to individuals who are consulted and requested for input during the decision-making and task implementation process. Their advice is significant in making accurate decisions and ensuring consensus.

The "Informed" role includes individuals who are informed and provided with information about the progress and results of the product. Although they are not directly involved in task execution, they need to be informed to understand and make appropriate decisions.

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By applying the RACI method, we ensure clarity and transparency regarding the roles and responsibilities of each member of our product team. This helps us enhance coordination, increase productivity, and effectively achieve product development goals.

II. Strategic context:

1. Opportunity statement

Project type: New product

Situation: Stemming from concerns raised by students, professors, and staff members of UEF University, there is dissatisfaction with the hygiene standards of food vendors near the campus gate. The food often contains excessive oil, grease, and seasoning. Ordering food through mobile apps poses challenges as it requires going downstairs to collect the order and involves long waits for elevators. Due to time constraints, individuals are unable to prepare nutritious home-cooked meals, yet still desire to consume balanced, healthy, and nourishing food options.

Solution: Understanding the concerns of the individuals involved, our team has conceived an idea to provide a convenient, wholesome, and environmentally friendly dining experience.

Competitive advantage: By promoting a green lifestyle, we aim to attract individuals who prioritize environmental sustainability and prioritize their health.

Preliminary estimation: Over a period of three days (October 11 13), we anticipate -generating a minimum revenue of 2 million VND. The sales team will consist of five members and additional investments will be made for items such as kumquat tea, wooden chopsticks, posters, ice, and paper cups, totaling approximately 400,000 VND.

Decision: We will seek input from our guiding professors and proceed with the implementation of this opportunity.

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III. The market environment for product

1. Industry and competitive activities 1.1. PESTEL:

Political (P):

The National Action Plan for Transparent, Accountable, and Sustainable Food System Transformation in Vietnam by 2030 (referred to as the Action Plan) requires food and beverage (F&B) producers and suppliers to provide clear information on the origin, production process, ingredients, and quality of their products. Additionally, F&B businesses must adhere to standards and regulations regarding resource management, environmental protection, and climate change adaptation. Companies may need to adapt and implement measures to ensure the sustainability of their operations. The Action Plan also opens up opportunities for business development and expansion to meet consumer demands for food safety and nutrition, creating a stable and reliable business environment for F&B enterprises.

=> O1: Businesses meet the criteria of the Action Plan Reduction of Value Added Tax (VAT) from 10% to 8%:

-In practice, in the context of inflation, the impact of increasing VAT and prices in the F&B industry can have complex and difficult- -to control effects. Some of the impacts can be listed as follows: Increased consumption capacity: When the value-added tax (VAT) decreases, the cost of F&B products will also decrease. Along with good inflation control in Vietnam, this can motivate consumers to spend and consume more. The F&B market will become more attractive due to lower prices, potentially increasing consumption and sales volume in the industry. Investment and expansion incentives: The reduction in VAT can create a more favorable environment for F&B businesses to invest in and expand their operations. With reduced production and business costs, companies may have greater financial resources to invest in upgrading infrastructure, expanding store networks, improving product and service quality, or enhancing marketing and promotion activities. => O2: Encouraging consumers to spend and consume more

=> O3: Reducing the cost of imported raw materials

=> O4: Using the saved money for more beneficial investments => O5: Alleviating financial pressure on consumers

World political situation is volatile:

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The CEO of JP Morgan Chase stated, "The conflict in Ukraine combined with the recent attacks on Israel could have far-reaching implications for the energy and food markets, global trade, and geopolitical relationships. This may be the most dangerous time the world has seen in decades." This indicates that wars can have a significant impact on the F&B industry in Vietnam, including Decreasing consumer demand: In times of war, uncertainty and concerns about the future can reduce consumer confidence and purchasing power. As a result, consumers may choose to cut spending on dining out and entertainment to alleviate financial burdens. Furthermore, the impact of the unstable world political situation creates an uncertain and unpredictable market outlook. Food and beverage businesses need to adapt to market fluctuations and changes. This may require developing new strategies and approaching new markets to overcome challenges and seize opportunities.

=> T1: Uncertain and unpredictable market conditions => T2: Continuous updating to adapt to market changes

=> T3: Consumers still have a skeptical mindset due to the impact of the world situation

Economic (E):

The inflation situation in the second half of 2023 is expected to show a decreasing trend.

The Consumer Price Index (CPI) chart for the months from the beginning of the year until now indicates a gradual decline in inflation compared to the same period last year. The data shows that the CPI in January recorded the highest increase at 4.89%. However, from then until June, this index decreased to 2%, and in July, the growth was only at a low level of 2.06%. There are several key factors contributing to this decreasing inflation trend. One of the important factors is that domestic fuel prices have decreased following global prices. Therefore, it is evident that inflation is tending to decrease in the last six months of 2023.

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The decrease in inflation can have several positive impacts on the F&B industry in Vietnam. Here are some key effects:

● Increased investment and expansion opportunities: When inflation is controlled, the business environment becomes more stable and reliable. This can create more favorable conditions for F&B businesses to invest and expand their operations. Businesses can easily access investment capital, mobilize resources, and develop new projects, including expanding production scale, distribution, or expanding store networks.

● Enhanced access to financial funding: In a stable and less volatile business environment, financial institutions (such as banks and investors) may tend to trust and provide financial funding more easily to F&B businesses. This can help businesses strengthen their financial capacity, invest in technology, improve service quality, and expand their operations.

● Reduced caution and concerns of the population: When inflation decreases, people tend to trust the government and have expectations for the stability and development of the economy. This can reduce people's hesitations and worries about their economic and personal financial situation. Instead, people are more willing to spend without excessive concerns about saving, and they may seek new experiences in enjoying food and beverages. This can lead to increased sales and growth in the F&B industry.

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Furthermore, there are additional implications: => O6: Decreased interest rates for business loans

=> O7: More stable business environment in Vietnam compared to the global situation => O8: Increased ability to persuade investors O9: Reduced caution and concerns of the population

=> T4: Excessive reduction in inflation may cause economic recession. The F&B industry in Vietnam has tremendous development potential.

In 2023, the F&B sector in Vietnam is expected to continue its strong growth, reaching revenues of nearly 610 trillion VND, an increase of about 18% compared to the previous year. Despite the forecasted difficulties in the economic outlook for 2023, Euromonitor predicts that the F&B market value will increase by 18% compared to 2022. After a prolonged period of social distancing due to the pandemic, the demand for F&B products has rebounded strongly. This demonstrates the interest and preference of consumers for the F&B industry. Businesses in the industry have undergone various fluctuations and adapted to meet the new market demands. Based on the strong growth and recovery of the F&B sector, forecasts indicate that this industry will continue to develop at a steady pace. According to Euromonitor, by 2026, the F&B market value is expected to reach nearly 1 million trillion VND (938,305 trillion VND). This demonstrates the potential and development opportunities in this field.

=> O10: The F&B industry still has significant potential and stable development.

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=> O11: Users are still interested in receiving new products. Average income of workers:

According to the "PRESS RELEASE ON THE LABOR EMPLOYMENT SITUATION IN Q3 AND 9 MONTHS OF 2023," the average monthly income of workers in Q3/2023 is 7.1 million VND, an increase of 6.8%, corresponding to an increase of 451 thousand VND compared to the same period last year. This income level may be sufficient to live in small to medium sized provinces and meet basic daily expenses, as well as to save a -portion. However, if workers live in major cities like Hanoi and Ho Chi Minh City, this average income level will be relatively low. The income of 7.1 million VND may meet basic needs for some people but may not be enough for areas with higher living costs or when facing special expenses. Therefore, it can be understood that people living in major cities will be more sensitive to higher prices, and businesses need to offer attractive promotional programs or provide higher value products to meet customer expectations.

-=> T5: Urban consumers are sensitive to prices.

=> T6: Initial promotional costs are necessary to attract customers.

In the context of global GDP growth expected to be lower than the previous year and weakened demand in developed economies, along with a forecasted slowdown in global trade, businesses and the labor market in Vietnam will be adversely affected by the difficulties in the world economy. However, due to the characteristics of the Vietnamese labor market, which has a high rate of informal employment, although some businesses may cut or postpone jobs, the unemployment rate in the third quarter of 2023 increased in

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terms of numbers compared to the previous quarter but remained unchanged in terms of the rate.

Specifically, the unemployment rate in the working age group in the third quarter of 2023 was 2.30%, unchanged from the previous quarter and increased by 0.02 percentage points compared to the same period last year. In the context of a slight increase and little change in the unemployment rate, the impact on social pressure, government spending, and consumer spending can be considered neutral or insignificant.

=> T7: The unemployment rate in Vietnam is still well-controlled. Labor market and job search:

Based on the image below, it can be seen that there are many factors contributing to the challenges in the F&B industry job market. The F&B industry often requires employees to have high versatility, meaning one person has to take on 2 3 different position- s. However, advancement opportunities in this industry are not clear. Unfortunately, many businesses in the industry do not contribute to social insurance for their employees and do not implement policies such as a 13th-month salary and other benefits. This situation has led to a decline in the attractiveness of jobs in the F&B industry in recent years.

Additionally, this industry also has the complexity of human resources, with 16.3% of businesses facing difficulties in scheduling work and 10.4% making errors in calculating staff salaries. Currently, most businesses in the industry still use traditional shift management methods through Excel, Zalo, or fingerprint attendance machines. Therefore, to enhance attractiveness and efficiency in the F&B industry, there is a need for improvement in human resources policies and work management processes.

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=> T8: Decline in the attractiveness of jobs in the F&B industry. => T9: Lack of long-term commitment to the F&B industry by employees.

Social (S):

Demographics:

According to the statistics of 2017, the age group from 0 to 14 accounted for 25.2% of the population in Vietnam. The age group from 15 to 65, which is the working-age group, had the highest proportion at 69.3% of the total population. The age group above 65 accounted for 5.5% of the population. The young population structure is significant for the country because it represents the main workforce. A large number of young people can meet the needs of the country's economic production activities as well as the national security obligations of citizens. A large labor force can contribute to the economic benefits of the

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country by contributing to the labor force and labor productivity. This also creates a "population dividend," which refers to the potential economic benefits that can be obtained from a young population. In addition, significant growth in the working-age population can support the development of various industries and sectors, contribute to innovation and entrepreneurship, and promote economic progress.

=> O12: Young population structure

=> T11: Keeping up with the continuous trends of the youth. Health Awareness:

The prolonged impact of COVID-19 has increased concerns related to neurological and mental health issues. The most common symptoms include fatigue, difficulty breathing, muscle and joint pain, loss or alteration of taste or smell, reduced cognitive function, sleep disorders, cough, chest pain, and headaches. Furthermore, 42% of working individuals are experiencing stress, leading to a phenomenon where office workers tend to neglect and let go of themselves due to increased exhaustion, anxiety, and depression. Feeling that they spend too much time on work, being overwhelmed, and always being ready to keep up with the rapid changes in the market can create pressure and stress for the workforce. Therefore, physical and mental health trends are becoming increasingly important:

● Physical fitness: Awareness of physical fitness has become an integral part of modern life. People realize that maintaining a healthy body brings not only physical health benefits but also positive effects on mental and emotional well being. -Physical fitness activities may include exercising, strength training, yoga, swimming, running, and other stress-reducing activities. This helps improve muscle strength, endurance, respiratory function, and immune system enhancement. ● Inner well-being: Awareness of internal health is increasing, with a focus on

nutrition, diet, and stress management. People recognize that maintaining a balanced and nutrient-rich diet can provide energy and help maintain good health. They also focus on reducing stress and maintaining mental well-being through practices such as meditation, yoga, and engaging in recreational and stress-reducing activities. ● Outer beauty: Currently, people are shifting from using cosmetics to taking care of

their appearance through consuming foods rich in vegetables, vitamins, and minerals. They balance the use of cosmetics with a nutritious diet rich in green vegetables. Green and organic foods are important sources of nutrients for healthy skin and hair. Green and organic foods contain essential nutrients, vitamins, and minerals necessary for maintaining healthy skin and enhancing the brightness and shine of hair. They are also rich in antioxidants, vitamins A, C, E, and minerals such

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as zinc and selenium, which help protect the skin from harmful environmental effects and the effects of aging.

=> O13: Focus on diet for better health

=> O14: Increasing emphasis on internal and external health

=> O15: Trend of consuming more vegetables, organic food for maintaining outer beauty and inner health

=> O16: Young people are gradually shifting towards a diet rich in organic green vegetables

=> O17: Business opportunities in the field of healthy food

=> T12: It requires significant costs and time to convince them of a healthy lifestyle Customer Buying Trends:

Proportion of eating out services: According to Ipos.vn, only 20.4% of customers use eating out services daily, with the ratio of 1-2 times per month being the highest percentage among a total of 3940 respondents.

Specifically, the frequency of eating out 1-2 times per month accounts for the highest proportion across all income groups.

Specifically, the age group of 23-25 years old and the age group of 26 30 years old are the -groups with the highest consumption levels for eating out services among all 6 -groups.

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The frequency of eating out 1-2 times per month accounts for the highest proportion across all income groups. This indicates that regardless of high or low income, consumers tend to have a preference for eating at home with this frequency. Additionally, the group with the least frequent use of eating-out services at least once a day shows an increasing trend with higher income levels. This suggests that individuals with higher incomes are more likely to spend on eating-out services daily. Therefore, based on the information provided, it can be concluded that higher income is associated with the ability to spend on eating out -services, or this group values convenience and time saving. Individuals with higher -incomes tend to eat out daily, while the lower income group tends to eat out less frequently.

Eating out services are not popular on a daily basis, and most users only occasionally use this service. This indicates that eating out is not a regular habit for the majority of users. Instead, the demand for this service is often triggered by specific factors or specific needs within a certain period. Younger age groups and higher income groups tend to consume eating out services more than other groups. This can be explained by the convenience and

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time-saving benefits that eating out services provide. Younger age groups often have busy lifestyles and less time for cooking, while higher income groups have the financial ability to afford eating out services.

When choosing to use eating out services, the most important criteria are delicious food and reasonable prices. The importance of delicious food accounts for the highest proportion, reaching 88.2%. This indicates that users prioritize the quality of food and beverages when selecting eating out services. Next, the factor of price is also considered important, with a rate of 72.9%. This shows that users also care about the price they have

These results may be surprising because the factor of "Attentive and professional service" ranks only fifth among the priority factors for customers, while the factor of "Promotions" receives only 34% of attention. Although the attention rates for "Attentive and professional service" and "Promotions" are not high, it does not mean that these factors are not important. It is possible that in the current diverse culinary environment, customers consider the quality of food and prices as the main determining factors when choosing eating out services. Therefore, based on these results, businesses or restaurants can focus on providing delicious food and beverages, while ensuring competitive prices to attract and maintain customer interest. At the same time, attentive and professional service and promotional programs should also be considered to create additional value for customers. => O18: The age group of 23-30 years old is the group with the highest consumption level for eating out services.

=> T13: Vietnamese people still maintain the habit of eating and cooking at home. => O19: The willingness of people to spend if the product saves time and is beneficial to health.

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=> O20: The development and potential for the food service industry in the young population structure.

=> O21: There is no need to incur excessive costs for future promotions and discounts." Trend of saving idle money:

According to the latest survey data from The Conference Board and Nielsen, despite recent positive economic developments, the economic recession mentality continues to persist in the mindset of Vietnamese consumers. 48% of respondents believe that the country is going through a recessionary period due to the impacts of the global economic and political situation, as well as the prolonged effects of COVID-19. Although 76% of people still believe that their personal financial situation will be good or excellent in the next 12 months, nearly half of the respondents believe that this is not a good time to spend money

Changes in priorities and values:

Despite concerns about spending money, consumers are still willing to spend a significant amount of money on expenses related to improving the quality of their personal lives, families, and children. With increasing concerns about health and well-being, products and services that can meet healthcare needs will attract the attention and emotions of Vietnamese consumers.

=> T14: Trends in people's savings.

=> T15: Product value must be improved to provide more value than ever before to meet customer needs.

Customer purchasing behavior:

Vietnamese consumers are becoming more sophisticated and are changing according to four trends:

● Increased awareness of value: Vietnamese consumers are becoming more sophisticated and concerned about the true value of the products and services they purchase. As mentioned above, instead of just focusing on price, they evaluate other factors such as quality, features, convenience, and the social impact of the products. They are becoming smarter in comparing prices and seeking deals and promotions to ensure they get the best value for their money.

● Preference for clean and organic food: Mr. Nguyen Minh Tien, Director of the Agricultural Trade Promotion Center, has given a positive assessment of the priority given to clean and organic food. He observed that opening organic food stores and clean fruit stores in cities is not difficult, and consumers are willing to pay higher

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prices for these products. The reason is that these products have clear origins and are inspected and monitored for quality by authorities. Mr. Nguyen Minh Tien's observation reflects the increasing trend of consumers prioritizing and choosing clean and organic products. Consumers have recognized the health and environmental benefits of prioritizing these products and are willing to invest more to obtain better quality and safety. However, it should be noted that the opening of organic food stores and clean fruit stores depends not only on consumer acceptance but also on the development and stable supply from farmers and producers. This requires support and investment in organic agriculture to meet the increasing demand of the market.

● Preference for mixed-channel platforms: Customers increasingly prefer shopping through multiple channels, including both online and traditional shopping. They can research products online, order through mobile apps or websites, and then pick up the products at stores or their homes. The ability to choose multiple shopping channels helps customers have a flexible and convenient shopping experience, while taking advantage of deals and promotions from different channels.

● Less loyalty to brands and stores: Brand loyalty is no longer as important as before. Customers are switching and experimenting with new brands and stores. They can easily search for information, reviews, and feedback from users before deciding to make a purchase. This puts pressure on brands and stores to maintain product quality and service while creating a good shopping experience to attract and retain customers.

● Having specific purposes when shopping: Consumers increasingly have specific purposes when shopping, not just buying to meet basic needs. They tend to seek products and services that can meet their goals and lifestyles. For example, they may look for organic products, environmentally friendly products, or products with positive social impact. This reflects the growing trend of interest in health, sustainability, and social impact in purchasing decisions.

=> T16: Unstable customer needs

=> O22: Customers have a tendency to be curious and prefer new things

=> T17: Challenges for new businesses due to too many distribution channel choices to reach consumers

=> O23: Customers are willing to pay for organic, green, and clean products

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