Phân tích đánh giá chiến lược kinh doanh BIG C Việt Nam I Advantages and disadvantages of approaches: via industry analysis and via via business resources Every company needs to build its own business strategy to exist and develop There are some appoarches of building strategies: Approach via market: Base on industry analysis and business environment Approach via capacity: Base on analysis of business resources and internal capacity Firstly, we must know that: “An industry is a group of companies providing products or services that can substitute for each other closely During the competition, these companies affect each other Goods and services which satisfy customers’ demands are basically similar.” Industry analysis also indicates: advantages of absolute cost, economies of scale, switching costs, government regulations and retaliations of companies within the industry, barriers to enter and competitions of rivals in the industry  Advantages of industry analysis: - Highlight the economic characteristics of industry, life circle of industry, trends of life circles to define the scales of investment limitation - Competitive forces within the industry; the nature and the power of forces - Drivers of industrial changes and effects - The strongest and weakest companies - Who can create next changes in the industry and how theses changes will have influence on the company? - Attraction of an industry in terms of possibility to gain profits higher than average income level - Industry analysis allows leaders to realize opportunities and threats; through strategic selections, the company can turn the powers of one or more forces into its own advantage - Threat of new entrants - Competitive rivalry within the industry - Bargaining power of suppliers (The number of suppliers, the importance of industry for suppliers, the importance of products provided by suppliers for customers and the differences in provision) - Bargaining power of customers (Proportion of product consumption in total income, differences of products, shift of demands, importance of product quality and the amount of information customers have) - Industry analysis also indicates: advantages of absolute cost, economies of scale, switching costs, government regulations and retaliations of companies within the industry, barriers to enter and competitions of rivals in the industry  Disadvantages: If business strategy is solely based on an analysis of industry, administrators will not know the actual capacity of the business as well as they are only able to build strategies that enterprises themselves are incapable of performing on scales of science and technology, capital, human resources, process management and competitiveness  Advantages of resources analysis: - Allow administrators to know about capital and ability to manage capital of the company - The ability to create capital of the company - The organizational structure of reporting system, planning, coordination and control of the comapny - The modernity of equipments and the position of the company - Confidence, satisfaction of employees in the company Knowledge, skills, capacity management and disciplines - Is the production process reasonable? - Ideas of innovations in production, scientific capacity as well as innovative capacity? - Fame of the company, credit in the heart of customers - Values of brand name - Competitiveness, time for product development and short commercialization, ability to create networks of agents - Perceptions of quality, duration and trust - Effective reactions and win-win supports, - Access to sources of raw materials, techonologies, patents, trademarks, trade secrets with low trading costs  Disadvantages: If we only access from the internal resources without analyzing business sectors and other factors, this will impact very severely to business strategy Then businesses can fall into the situation of massive production without knowing the market demand, leading to inventory and cash flow is not circulating Products not meet the demands if life circle of product is short Do not know disadvantages if entering market; strengths, weaknesses of competitors and substitute products Do not know who competitors are and what disadvantages of entering the industry are Also, not know strengths and weaknesses of competitors and substitute products II/ Analyze and assess business strategy of BIG C Vietnam 2.1Introduction Big C is a retail brand of Casino Group with more than 9,000 stores, supermarket chains in many countries around the world In 1998, Big C firstly presented in Vietnam with the first supermarket located in Dong Nai and has been growing rapidly Up to 2013, Big C has 23 agents across the country and is preferred by more and more consumers with affordable prices, which are suitable with with shopping habits of consumers (Source: http://www.bigc.vn/Default.aspx?tabid=206&language=vi-VN) With more than 8,000 employees, Big C offers essential goods, fresh products to household goods, electrical goods, electronics and entertainment centers Special promotions are also applied 2.2 Market approach of BIG C 2.2.1 Approach from outside environment In the past 10 years, the retail industry of Asia achieved remarkable accomplishments and was one of 30 fastest growing industries Scale of retail market is expanding in Asia, increasing by 30% during the period of 2007 – 2011 And it is estimated that in 2013 the scale of this market increase by 10% though world economy crisis affect the purchasing power of consumers ( nguồn: http://www.bigc.vn/Default.aspx?tabid=206&language=vi-VN 2.2.2 Existing barriers of entering Big C has succeeded in creating entry barriers, making it more difficult and costly for other companies who want to enter the industry Firstly, Big C has advantage of economies of scale Big C is a retail system which is widely available in many countries around the world Therefore, its production scale is very big And this makes its cost and price per one unit of product is relatively small in comparison with other companies For example, for the same products, products of Big Care are always cheaper than that of other supermarkets’ products such as Star Bow, Hapro and Techsimex Big C, on the other hand, always creates incentives for customers via constantly promotions or discounts In addition to economies of scale, it also created some other barrier system like: the need for initial capital investment and commercial elements Big C has built a brand that is well known not only in domestic market but also in global market 2.2.3 Bargaining power of suppliers Big C has applied very successfully the bargaining power of suppliers Thanks to that bargaining power, Big C can increase the prices of some products but still make sure that these prices not exceed market prices, thus, Big C can increase supply volumes Big C has at most exclusive brands: WOW, eBon, Casino 2.2.4 Bargaining power of customers At Big C, customers always get good products with reasonable prices Customers’ demands are satisfied Thus, Big C has reduced the bargaining power of customers 2.2.5 Competition in the industry Big C is located for providing cheap goods, so the company constantly offer promotions and introduce cheap products which are suitable with income of customers Besides, Big C is associated with major manufacturers to reduce production costs to the minimum level Also, the company has policies to stabilize prices during the current crisis, creating favorable conditions for customer's shopping activities Therefore, Big C are evaluated to be very competitive in the industry 2.2.6 Threat of substitute products Some products which can replace beers and wines: coffee, tea…These products can fulfill some needs of customers It can be seen that the main substitute product is the ability to fulfill the demands in comparison with other companies Price, quality and other environmental factors like social, political or technological are all affect to the threat of substitute products 2.2.7 Bargaining of related sides Government: supermarkets must ensure all legal factors and accept required reserse ratio Investors and shareholders: require high profits If not, they will withdraw their funds and invest to other sectors Key factors of success: - Human resources: This is considered a key factor for the success of the business and development of retail system Big C has a good staff, professional expertises and skilled information technology teams Especially, qualified professional staff is a decisive factor which determines the success or failure of the supermarket Besides, the staff of Big C is very responsible on working Continuous training is considered an urgent task, a red threat throughout the development process of the company Leaders and personnel on transactions must be typical examples which are foundations to build cultural style - Culture: Culture is what human beings create, including material culture, spiritual culture and behavior culture Any profession in social life is also related to culture Distinct characteristic of retail system is to regularly be in contact with customers who are very different from qualifications, nationality, gender, the age, color and purposes of using products and services Thus, cultural awareness and cultural behavior in jobs are required for salespeople…Culture material requires a broad, polite and modern business system Apparels of sales staff of Big C are also an important element in the material culture, which makes internal management easier, creating dignified behavior and raising awareness of responsibility of employees Then, customers can see that they receive respects from employees whom they meet - Technology: Many experts appreciate the role of technology In the period of international economic integration, legal framework becomes clear Barriers of discrimination among supermarkets no longer exist and services of supermarkets are nearly identical All supermarkets have more advanced technologies Sensibility of access new technologies is gradually revealed 3.1 Analysis of inside environment SWOT analysis Opportunities Strengths - Vietnam joined WTO - Chances Weaknesses to expand - Must improve - Retail market develops distribution system (in quality and coming time, Big C will methods more and more - Income is increasing open more agents in Nha - Expand good payments distribution - Stimulus package of Trang and Vung Tau) billion USD systems, using both product traditional and modern structure, especially high- methods (online sales) - Diversify valued and profitable - Improve the efficiency of products marketing, customer caring and PR… Threats - competition S-T is fiercer and fiercer - Shopping habits - Economic crisis - Supply of goods is scarce and in low quality - Legal system W-T - improve quality, service human resources - Expand structure, - Enhance perceptions and improve shopping habits of item be customers - Have promotions competitive in both and prices and qualities campaign - Enhance the quality of supply, find other discounts more often to stimulate consumption partners Over 10 years in Vietnam, Big C has carried out brand development quite well The company has invested in marketing to develop market research and after-sale services, which have helped the company increase sales on the market Company should continue maintaining what has been achieved and expanding business scale Every weeks, Big C releases a newsletter of promotion with attractive prices and gifts The promotions with themed goods (beauty, housewife, kids shopping or fashion) create diverse choices for customers, strong reduction (up to 50% product value) Besides, Big C also builds image through charity activities Big C always wants to become an enterprise with high sense of responsibility, being actively involved in charity activities The strategy of analyzing external factors and internal business resources helps Big C, a European brand, survive and develop in Vietnam and become one of the most preferred brands In addition to brand building, it can be seen that supermarket chains of Big C are growing more and more Consumers’ trust and love for this brand is desirable for all domestic brands 10 The end 11 ... receive respects from employees whom they meet - Technology: Many experts appreciate the role of technology In the period of international economic integration, legal framework becomes clear... research and after-sale services, which have helped the company increase sales on the market Company should continue maintaining what has been achieved and expanding business scale Every weeks,... increase the prices of some products but still make sure that these prices not exceed market prices, thus, Big C can increase supply volumes Big C has at most exclusive brands: WOW, eBon, Casino