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TABLE OF CONTENTS I INTRODUCTION TO COCA COLA VIETNAM 1 II COCA COLA BUSINESS ENVIRONMENT 2 2 1 About Vietnam’s Non alcoholic drink industry 2 2 2 About Coca Cola Vietnam 3 2 2 1 Public, private and v. TABLE OF CONTENTSI. INTRODUCTION TO COCACOLA VIETNAM1II. COCA COLA BUSINESS ENVIRONMENT22.1. About Vietnam’s Non alcoholic drink industry22.2. About CocaCola Vietnam32.2.1. Public, private and voluntary sectors32.2.2. Legal forms42.2.3. Company’s size52.2.4. Cocacola’s vision and missions72.2.5. Coca cola’s partnership72.3. Environmental Factors that Impact CocaCola in Vietnam8III. INTRODUCTION AND ANALYSIS OF PEPSICO TAN HIEP PHAT GROUP93.1. Pepsico93.2. Tan Hiep Phat Group10IV. BUSINESS FUNCTIONS OF COCACOLA Vietnam124.1. Organizational chart of Coca Cola124.2. External stakeholders of the CocaCola company13V. CONCLUSION145.1. Main points145.2. Recommendations14REFERENCE16 I. INTRODUCTION TO COCACOLA VIETNAMCocaCola is one of Vietnams most wellknown multinational brands. CocaCola Vietnams plants in Hanoi, Da Nang and Ho Chi Minh City, support a diversified number of indirect employment, which are six to eight times larger, thanks to the companys value chain. CocaCola has continually engaged in product innovation and generated a diverse range of highquality beverages, including zerosugar and lowersugar product lines, while diversifying packaging and increasing business coverage in its quest to become a whole beverage corporation.The companys portfolio in Vietnam involves CocaCola, CocaCola Light, Sprite, Fanta, Coke Zero, Minute Maid Nutriboost, Minute Maid Teppy, Schweppes, Aquarius and Dasani. Since 2017, to meet consumers fastchanging flavors and demands, CocaCola Vietnam has proactively broadened its highquality portfolio to promote packaged juice and tea products like Georgia canned RTD coffee, Fuzetea+ and most recently, CocaCola Energy. In 2020, Cocarevenue Colas saw a rise of 13 percent to 9.3 trillion VnDong. It has made longterm improvement a priority in all of its operations, including creating a safe and healthy working environment and educating employees. Several sustainable development initiatives have defined aims of energy conservation, water efficiency, and water balance. CocaCola continues to invest in longterm community development in the areas where it operates.CocaCola has a 48.6 percent market share in Vietnam in 2015, according to statista.com. The number of CocaCola outlets currently on the market is 130,000. Soft drink consumption (on average) exceeds 100 million liters each year. Annual sales are around 19 million barrels on average.II. COCA COLA BUSINESS ENVIRONMENT 2.1. About Vietnam’s Non alcoholic drink industryFigure 1: Nonalcoholic drink producers revenues Although the only two major foreign corporations in the sector, Suntory Pepsico and CocaCola, have a 60 percent market share, Tan Hiep Phat and Trung Nguyen two key domestic players have a 20 percent market share. The following are the reasons behind this:•Obsolete manufacturing equipment ( 52% of all firms)•Small production scaleFigure 2: Market share of nonalcoholic beverages in Vietnam Soft drinks accounted for the majority of this segments revenue, which reach USD 7.098 million in 2020 and rise at a rate of 6.5 percent through 2023. Under the favorable effect of consumer choices, per capita consumption is increasing. The youth under the age of 24 account for almost 40% of the Vietnamese population, indicating that the soft drink industry will continue to develop. When 83 percent of customers pick nutritious and healthier items over sugary beverages, the trend toward a healthy lifestyle will have a big impact on the industrys image.Soft drink and carbonated soft drink volume sales in Vietnam are expected to reach 3.5 billion and 1.7 billion liters in 2023, respectively, due to the fastest growth in the fastmoving consumer goods industry.2.2. About CocaCola Vietnam2.2.1. Public, private and voluntary sectorsAccording to TMC Academy, Private sector organisations are usually set up for personal gain and are funded by shares issued, loans from banks, overdrafts etc.The CocaCola Company and the nonprofit organization, Ocean Cleanup, have officially partnered to realize a clear common goal: to prevent plastic waste from entering the ocean. The first approach is to dispose of the waste from rivers.Leveraging CocaColas global scale and network and The Ocean Cleanups datadriven technology solutions, this partnership is geared towards deploying energypowered Interceptor river cleaning systems. Solar energy, developed by a Dutch nonprofit organization, in 15 rivers between now and the end of 2022.Public sector organisations are usually set up in the interests of the community and are funded wholly or partly by the Government from public funds and are answerable to a government department or the Treasury.Voluntary organizations are defined as nonprofit, nonstatutory, autonomous, and run by individuals who are not compensated for their work.In term of Voluntary, Since 2012, the Central Committee of the Vietnam Red Cross has signed a cooperation agreement with CocaCola Vietnam Co., Ltd in disaster management. From 2013 to 2017, the two sides expanded the field of community health care cooperation through the following activities: Free medical examination and medicine for the poor, training in first aid skills for volunteers in the community. With the latest donation worth more than 9 billion VND, CocaCola Vietnam has donated more than 16 billion VND to prevent the COVID19 epidemic through the coordination of the Vietnam Red Cross Society. Contributing to help the country adapt to the new normal safely and healthily.2.2.2. Legal formsThe Companies Acts distinguish between:(a) Public limited companies that are traded on an official stock market. (Such companies must include the letters plc in their names.)(b) Private limited companies (which must include Ltd or Limited in their title) and whose shares are only transferable by direct contact and purchase from the shareholders (eg members of a family).As a Private limited companies, Coca cola full name is:COCACOLA BEVERAGES VIET NAM LIMITED LIABILITY COMPANYRegistered Name:CONG TY TRACH NHIEM HUU HAN NUOC GIAI KHAT COCACOLA VIET NAMAbbreviation Name:COCACOLA BEVERAGES VIET NAM LIMITED2.2.3. Company’s sizeThe concept of size is problematic. It can be viewed in terms of:a)Assets employedb)Profits earnedc)Net worth in real terms.d)Numbers employede)Volume of outputf)Volume of salesSmall business are usually owned and run by one person or by a few people.Medium sized businesses normally employ between 50 and 250 people and operate either at local or national levelLarge businesses normally have factories offices and outlets in more than one city and often in more than one country.
TABLE OF CONTENTS I INTRODUCTION TO COCA-COLA- VIETNAM II COCA COLA BUSINESS ENVIRONMENT 2.1 About Vietnam’s Non- alcoholic drink industry 2.2 About Coca-Cola Vietnam .3 2.2.1 Public, private and voluntary sectors 2.2.2 Legal forms .4 2.2.3 Company’s size 2.2.4 Coca-cola’s vision and missions .7 2.2.5 Coca- cola’s partnership 2.3 Environmental Factors that Impact Coca-Cola in Vietnam III INTRODUCTION AND ANALYSIS OF PEPSICO & TAN HIEP PHAT GROUP 3.1 Pepsico .9 3.2 Tan Hiep Phat Group 10 IV BUSINESS FUNCTIONS OF COCA-COLA Vietnam .12 4.1 Organizational chart of Coca Cola .12 4.2 External stakeholders of the Coca-Cola company 13 V CONCLUSION .14 5.1 Main points 14 5.2 Recommendations 14 REFERENCE 16 i I INTRODUCTION TO COCA-COLA- VIETNAM Coca-Cola is one of Vietnam's most well-known multinational brands Coca-Cola Vietnam's plants in Hanoi, Da Nang and Ho Chi Minh City, support a diversified number of indirect employment, which are six to eight times larger, thanks to the company's value chain Coca-Cola has continually engaged in product innovation and generated a diverse range of high-quality beverages, including zero-sugar and lower-sugar product lines, while diversifying packaging and increasing business coverage in its quest to become a whole beverage corporation The company's portfolio in Vietnam involves Coca-Cola, Coca-Cola Light, Sprite, Fanta, Coke Zero, Minute Maid Nutriboost, Minute Maid Teppy, Schweppes, Aquarius and Dasani Since 2017, to meet consumers' fast-changing flavors and demands, Coca-Cola Vietnam has proactively broadened its high-quality portfolio to promote packaged juice and tea products like Georgia canned RTD coffee, Fuzetea+ and most recently, CocaCola Energy In 2020, Coca-revenue Cola's saw a rise of 13 percent to 9.3 trillion VnDong It has made long-term improvement a priority in all of its operations, including creating a safe and healthy working environment and educating employees Several sustainable development initiatives have defined aims of energy conservation, water efficiency, and water balance Coca-Cola continues to invest in long-term community development in the areas where it operates Coca-Cola has a 48.6 percent market share in Vietnam in 2015, according to statista.com The number of Coca-Cola outlets currently on the market is 130,000 Soft drink consumption (on average) exceeds 100 million liters each year Annual sales are around 19 million barrels on average II COCA COLA BUSINESS ENVIRONMENT 2.1 About Vietnam’s Non- alcoholic drink industry Figure 1: Non-alcoholic drink producers' revenues Although the only two major foreign corporations in the sector, Suntory Pepsico and Coca-Cola, have a 60 percent market share, Tan Hiep Phat and Trung Nguyen - two key domestic players - have a 20 percent market share The following are the reasons behind this: Obsolete manufacturing equipment ( 52% of all firms) Small production scale Figure 2: Market share of non-alcoholic beverages in Vietnam Soft drinks accounted for the majority of this segment's revenue, which reach USD 7.098 million in 2020 and rise at a rate of 6.5 percent through 2023 Under the favorable effect of consumer choices, per capita consumption is increasing The youth under the age of 24 account for almost 40% of the Vietnamese population, indicating that the soft drink industry will continue to develop When 83 percent of customers pick nutritious and healthier items over sugary beverages, the trend toward a healthy lifestyle will have a big impact on the industry's image Soft drink and carbonated soft drink volume sales in Vietnam are expected to reach 3.5 billion and 1.7 billion liters in 2023, respectively, due to the fastest growth in the fast-moving consumer goods industry 2.2 About Coca-Cola Vietnam 2.2.1 Public, private and voluntary sectors According to TMC Academy, Private sector organisations are usually set up for personal gain and are funded by shares issued, loans from banks, overdrafts etc The Coca-Cola Company and the non-profit organization, Ocean Cleanup, have officially partnered to realize a clear common goal: to prevent plastic waste from entering the ocean The first approach is to dispose of the waste from rivers Leveraging Coca-Cola's global scale and network and The Ocean Cleanup's data-driven technology solutions, this partnership is geared towards deploying energy-powered Interceptor river cleaning systems Solar energy, developed by a Dutch non-profit organization, in 15 rivers between now and the end of 2022 Public sector organisations are usually set up in the interests of the community and are funded wholly or partly by the Government from public funds and are answerable to a government department or the Treasury Voluntary organizations are defined as non-profit, non-statutory, autonomous, and run by individuals who are not compensated for their work In term of Voluntary, Since 2012, the Central Committee of the Vietnam Red Cross has signed a cooperation agreement with Coca-Cola Vietnam Co., Ltd in disaster management From 2013 to 2017, the two sides expanded the field of community health care cooperation through the following activities: Free medical examination and medicine for the poor, training in first aid skills for volunteers in the community With the latest donation worth more than billion VND, Coca-Cola Vietnam has donated more than 16 billion VND to prevent the COVID-19 epidemic through the coordination of the Vietnam Red Cross Society Contributing to help the country adapt to the new normal safely and healthily 2.2.2 Legal forms The Companies Acts distinguish between: (a) Public limited companies that are traded on an official stock market (Such companies must include the letters 'plc' in their names.) (b) Private limited companies (which must include 'Ltd' or 'Limited' in their title) and whose shares are only transferable by direct contact and purchase from the shareholders (eg members of a family) As a Private limited companies, Coca- cola full name is: COCA-COLA BEVERAGES VIET NAM LIMITED LIABILITY COMPANY Registered Name: CONG TY TRACH NHIEM HUU HAN NUOC GIAI KHAT COCACOLA VIET NAM Abbreviation Name: COCA-COLA BEVERAGES VIET NAM LIMITED 2.2.3 Company’s size The concept of size is problematic It can be viewed in terms of: a) Assets employed b) Profits earned c) Net worth in real terms d) Numbers employed e) Volume of output f) Volume of sales Small business are usually owned and run by one person or by a few people Medium- sized businesses normally employ between 50 and 250 people and operate either at local or national level Large businesses normally have factories/ offices and outlets in more than one city and often in more than one country As a large businesses, Coca Cola Beverages Vietnam Ltd is a 100% foreign-invested company It is a subsidiary of the Bottling Investments Group (BIG) which is 100% owned and operated within The Coca Cola Company Coca-Cola has 99% of its Vietnamese employees, out of about 4,000 employees in Vietnam Every year, enterprises invest more than 1.4 million USD in human resource development activities During 25 years of operation in Vietnam, Coca-Cola always has focused on developing human resources, creating conditions for all employees to maximize their potential As a global enterprise, Coca-Cola considers human resource development as the key to realizing its sustainable development strategy in all markets Figure 3: Total asset, revenue and net- profit of Coca-cola Vietnam Coca-Cola Vietnam had a revenue of about VND 7,220 billion in 2016, up from roughly VND 6,870 billion the year before By 2019, sales of this "large man" beverage had reached around 9,300 billion VND Coca-Cola Vietnam only had a net profit of VND 500 billion in 2016 owing to cost accounting for more than 60% of revenue and operating expenditures Despite an increase in sales, earnings plummeted by 50% in 2017, to little over 225 billion dongs The company achieved a profit of VND 550 billion and VND 810 billion in 2018 and 2019, respectively Coca-Cola Vietnam's total assets increased from VND 7,235 billion in 2016 to VND 9,700 billion in 2019 2.2.4 Coca-cola’s vision and missions According to TMC Academy “Vision statements- are seen as documnets that set out the strategic intentions of the organisation.” “Mission statements- should outline the specific role that the organisation plans to fulfill over the long term and therefore limits the scope of its operations by implicitly areas outside its stated mission.” Coca-Cola's Vision: Coca-Cola's Vision is to create brands and beverages that people love that inspire both people's bodies and minds At the same time, develop in a sustainable way and towards a better-shared future, bringing positive effects to the lives of people, communities and the whole world Coca-Cola’s Missions • To refresh the world • To create value and make a difference • To inspire moments of optimism and happiness 2.2.5 Coca- cola’s partnership The 17th of October, 2018 in Ha Noi In Ha Noi, UNESCO established a new cooperation with Coca-Cola Vietnam and its development partners with the goal of reducing plastics and solid waste in Vietnam in order to achieve a "World Without Waste." The event, which is being held at Ha Noi's Green One UN Building, is a unique opportunity to bring together all active UN agencies, government entities and important development partners, the commercial sector, local NGOs, and young Vietnamese activists and students for collective action Coca-cooperation Cola's with the British Council supports social entrepreneurship and community involvement through the EKOCENTERs program across Vietnam in 2020, concentrating on environmental awareness and trash management, in line with the UNESCO initiative, under the following parameters These newly announced collaborations include a wide range of educational programs, creativity activities and contests, as well as robust interactions with the public and recognized organizations in order to promote plastic waste management awareness and actions They also show Coca-and Cola's partners' strong commitment and collaboration in addressing Vietnam's challenges in raising public awareness about plastic waste collection, segregation, and recycling for shared value in the circular economy, resulting in new positive changes in the plastic waste management perspective 2.3 Environmental Factors that Impact Coca-Cola in Vietnam Social Responsibilities of Corporations Culture is one of the most important aspects of life Is Vietnam Coca-current Cola's CSR initiatives appropriate in the new market, or does it require a fresh initiative to meet the needs of the potential market? Climate Change Effects – How will climate change affect the CocaCola business model and supply chain in Vietnam? If the supply chain is not flexible, for example, supplies from one region of the world may be delayed due to a sudden climate change, resulting in bottlenecks Waste Management - What is the potential market's waste management policy, and how can Vietnam Coca adhere to the market's waste management requirements? Environmental Organizations' Influence and Effectiveness Environmental standards enforcement agencies play a key role in maintaining norms However, in many developing countries, these organizations use delaying tactics to extort bribes Vietnam Coca should be informed that such activities exist in the country Climate Agreement in Paris and National Government Commitment to the Agreement – What are the country's commitments under the Paris Agreement, and what is the country's general degree of agreement on the Paris Climate Agreement? For example, Trump's failure to honor US agreements has fostered a climate of uncertainty III INTRODUCTION AND ANALYSIS OF PEPSICO & TAN HIEP PHAT GROUP 3.1 Pepsico PepsiCo (now Suntory PepsiCo Vietnam – Pepsi joint-venture) and Coca-Cola, which have been present in Vietnam since 1994, have quickly become the two most prominent brands in the non-alcoholic drink market In a similar way to the ongoing global war between Coca-Cola and Pepsi, the two behemoths have been fiercely competing domestically Pepsi has recently increased its revenues, which are now two times higher than Coca- Cola's Coca-Cola and Pepsi both have critical products that are similar in each segment If Coca-Cola has Coca-Cola, Nutriboost, Samurai, Aquarius, Dasani, and other products, Pepsi offers Pepsi, 7Up, Revive, Mirina, Aquafina, Twister, and other Pepsi products Pepsi and Coca-Cola have both had successful business years in recent years Even Pepsi has made a profit of VND2,735 billion ($117 million) after erasing its losses Pepsi had a revenue of VND15 trillion ($645 million) and an after-tax profit of VND1,427 billion ($61.3 million) in 2017, up 5% and 27%, respectively, from the previous year Figure 4: Suntory PepsiCo Vietnam’s business results 10 3.2 Tan Hiep Phat Group Tan Hiep Phat, which leads the green tea segment with Zero-Degree Lemon Green Tea and Dr Thanh products, is Pepsi and Coca-most Cola's significant local competitor According to Euromonitor's report, PepsiCo's non-alcoholic beverage market share has risen sharply from 27 percent to 33 percent in the last five years, based on off-trade sales Meanwhile, Coca-Cola was down around 10%-11%, and Tan Hiep Phat was down from 16.5 percent to 13.1 percent as a result of the fly-in-the-product scandal Figure 5: Tan Hiep Phat annual report 2019 Source: CAFEF, VIRAC Despite its lower market share, Tan Hiep Phat's profit margin outperformed Pepsi and Coca-Cola Tan Hiep Phat's two plants in Binh Duong and Ha Nam provinces generated nearly VND8.7 trillion ($380 million) in revenue in 2019 Pre-tax profit, on the other hand, was reported at 11 VND 3.7 trillion ($77.3 million), representing a profit margin of 36% In the two foreign companies, this rate is only about 15% According to the reports, Tan Hiep Phat's cost of goods sold accounts for around 60% of revenue, while it accounts for 70% in the two foreign companies Coca-Cola, in particular, has a selling cost that is twice that of Tan Hiep Phat Pepsi is four times more expensive, but Tan Hiep Phat's turnover is only two times higher IV BUSINESS FUNCTIONS OF COCA-COLA Vietnam 4.1 Organizational chart of Coca Cola According to TMC Academy , In a geographical, regional or territorial departmentation structure, some authority is retained at Head Office, but dayto-day operations are handled on a territorial basis Figure 6: Geographical, organizational Structure of Coca Cola The advantages of a geographical structure 12 A geographical structure can provide a number of operational and strategic benefits, such as: close communication with regional customers strong collaborative teams at each location the ability to better serve local needs and tailor their approach to the local market the ability to promote positive competition between different departments The disadvantages of a geographical structure The main disadvantage of a geographical organizational structure is the potential for conflict between central and local management, as individual divisions often assume a great deal of autonomy Other drawbacks include: potential duplication of works, functions and resources, some economies of scale may be failed 4.2 External stakeholders of the Coca-Cola company There are three broad types of stakeholder in an organisation: a Internal stakeholders( employees, management) b Connected stakeholders( shareholders, customers, sumppliers, financiers) c External stakeholders( the community, government, pressure groups) Bottling partners, customers, consumers, suppliers, industry partners, governments, and non-governmental organizations (NGOs) are the company's primary external stakeholders The company's total number of customers is difficult to estimate; however, over 1.9 billion servings of its drinks are consumed each day around the world The company collaborates with a 13 number of bottling partners around the world to get these massive servings to consumers The Coca-Cola Company sells beverage bases and syrups to bottling partners, who then turn around and sell the finished products to wholesalers, retailers, independent outlets, restaurants, and movie theaters, to name a few The products are then sold to consumers by these organizational customers This demonstrates that the company's bottling partners are important stakeholders Governments and non-governmental organizations (NGOs) are also important stakeholders in the Coca-Cola Company 14 V CONCLUSION 5.1 Main points The company's recent acquisition of Coca-Cola Enterprises' bottling business, as well as its productivity initiatives, are expected to save money Coke Company, in particular, plays an important role in the beverage industry in Vietnam Customers enjoy their meaningful and colorful advertisements, which are complemented by lively music Coca-Cola Company should create a lot more advertising in the future to meet the demands of Vietnamese customers To compete with PepsiCo Inc., Coca-Cola must increase its advertising spending 5.2 Recommendations Highlighting on High Worth Services Recommendations In this case study, the government could support the establishment of a Center of Excellence in Company, Danger Valuation Management, Internal Audit, Tax, and Professional Growth and Development for CFOs through a variety of incentives, including tax breaks The ownership of a general public accounting firm would be deregulated, lowering entry barriers Small and Medium-sized Practices (SMP) could be updated by the federal government by providing incentives for company cooperation, training, and innovation financial investment Supporting Accountancy Education and Research Establishing a Coca-Cola In Vietnam Case Recommendations Certification Program could benefit accounting education and research (SQP) It can also create specialization courses for Chief Financial Officers (CFOs) by enhancing the value of skills such as risk management, internal audit, tax, professional development, and service valuation through competency structures, certifications, and certifications 15 Strengthening the Accountancy Infrastructures and Institutions The federal government may be able to persuade the Institute of CocaCola In Vietnam Case Recommendations Chartered Accountants (ISCA), the country's accounting body, to reorganize internationally An Accountancy Sector Advancement Fund (ASDF) could be established to incentivize the decisions and improve performance, constructability, and regionalization 16 REFERENCE Bui Van Quang, Building a brand of Legend flower tea, Hanoi Abviet, 2017 Tầm nhìn sứ mệnh thương hiệu viewed 25 oct 2021, Khanh Kiem 2020, Để trì vị dẫn đầu, Coca Cola liên tục tạo thương hiệu mới, view 25 Oct 2021 Minh Hao 2017, Phân tích chiến lược Marketing Cocacola View 22 Oct 2021 Hoang Ngoc 2017, Bán hàng giỏi - Kinh nghiệm, kiến thức giúp nâng cao kỹ bán hàng Viewed 21 Oct 2021 Brands Vietnam 2019, Coca-Cola bắt trend 2019: Kết hợp ăn uống trải nghiệm đa giác quan, đa phương tiện, viewed 22 Oct 2021 TS Nguyen Hoang Tien 1980, lecture on brand management, Hanoi Hong Lam 2021, Vai trò thương hiệu mạnh doanh nghiệp, viewed 26 Oct 2021 10 VietnamCredit 2020, Vietnam beverage report 2020, viewed 26 Oct 2021 17 ...I INTRODUCTION TO COCA-COLA- VIETNAM Coca-Cola is one of Vietnam'' s most well-known multinational brands Coca-Cola Vietnam'' s plants in Hanoi, Da Nang and Ho... Coca-Cola Vietnam has donated more than 16 billion VND to prevent the COVID-19 epidemic through the coordination of the Vietnam Red Cross Society Contributing to help the country adapt to the new... be able to persuade the Institute of CocaCola In Vietnam Case Recommendations Chartered Accountants (ISCA), the country''s accounting body, to reorganize internationally An Accountancy Sector Advancement