TRNG I HC M TP.HCM UNIVERSITÉ LIBRE DE BRUXELLES HO CHI MINH CITY OPEN UNIVERSITY SOLVAY BRUSSELS SCHOOL MBAVB4 NGUYEN MANH QUYEN FACTORS INFLUENCING HOMEBUILDERS’ INTENTION OF USING READY MIXED CONCRETE WHEN BUILDING PRIVATE HOUSES MASTER PROJECT MASTER IN BUSINESS ADMINISTRATION (PART-TIME) Tutor’s Name: NGUYEN MINH HA, Ph.D. Ho Chi Minh City (2011) i MBAVB4 – FINAL PROJECT - 2011 COMMITMENT I hereby commit that this thesis “Factors influencing homebuilders‟ intention of using ready mixed concrete when building private houses” has not been previously submitted for any degree or diploma at any educational institution, and it is my original work for MBAVB4 program. All received supports and due reference sources are acknowledged. Ho Chi Minh City, February 14 th , 2012 NGUYEN MANH QUYEN ii MBAVB4 – FINAL PROJECT - 2011 ACKNOWLEDGEMENT It is obvious that I could not accomplish this thesis if I would not have received support, assistance, guidance and encouragement from people to whom I am indebted so much. I would like to acknowledge my gratitude toward my tutor, Nguyen Minh Ha Ph.D., for his great guidance through my working on this thesis. I would like to express my deep appreciation to all professors and coordinators of Vietnam-Belgium master program who are dedicated to deliver valuable lectures by which I have chances to broaden my knowledge. I would like to show my big thanks to Ms. Le Phuong Ngoc, Beton Retail Manager, and her team at Holcim Vietnam Co., Ltd. for helping me interview homebuilders. Also, I extend my thanks to all beloved classmates of MBA-VB4, who have been with me during the course, for their sharing knowledge and giving great encouragement Last but not least, I would like to give my special thanks to beloved members in my family who provide me with great encouragement and support during my study in the past 2 years. iv MBAVB4 – FINAL PROJECT - 2011 ABSTRACT In parallel with the country‟s economic growth, urbanization occurs in many parts of Vietnam at high speed, including extension of big cities like Hanoi and HoChiMinh. According to a report on strategic housing development to 2020 and vision 2030 by the Ministry of Construction in 2011, the number of current dwelling is about 16.7m 2 per capita. With the strategic development orientation by 2020, the whole country needs to build more one billion square meters of floor area from now till 2020 to achieve 25m 2 per capita by the year 2020. Therefore, there will be more residential projects to come in which private houses are included. Unlike multi-storey buildings that the use of ready mixed (RMX) concrete is compulsory, using RMX or site mixed concrete to build private houses is more likely a volitional choice of homebuilders. This study aims to explore and evaluate factors that impact homebuilders‟ intention of using RMX concrete instead of site mixed concrete. A questionnaire was developed and used to interview - with the help of Holcim Beton Retail team - directors of small contractors and their chief engineers who are representatives of homebuilders as a whole for data collection. Based on the Theory of Planned Behavior, the research model was constructed by Attitudes toward Behavior, Subjective Norms and Perceived Behavioral Control aggregating with an additional factor that is Perceived Consequences derived from Theory of Interpersonal Behavior to measure homebuilders‟ intention of using RMX concrete in a direct measurement method. Totally, the research model contains four factors. Following reliability test, other analyses were conducted to find out factors influencing homebuilders‟ intention toward the use of RMX concrete, comprising Exploratory Factor Analysis (EFA) and Regression Analysis. Besides, ANOVA was applied to know whether or not homebuilders‟ intention is statistically significant difference within homebuilder group classified by age, experience and education. Overall, the findings showed that no significant difference of the intention towards using RMX concrete by homebuilders‟ characteristics such as age, experience and education, and the homebuilders‟ intention are impacted by all the four factors: Attitude, Subjective Norms, Perceived Behavioral Control and Perceived Consequence. Eventually, recommendations for managerial people of RMX concrete suppliers are (1) to keep RMX concrete quality consistency, (2) to get homeowners‟ awareness of advantageous points of RMX concrete and (3) to improve service on delivery and consultancy on method of concrete pour to save cost for homebuilders. v MBAVB4 – FINAL PROJECT - 2011 TABLE OF CONTENT COMMITMENT i ADVISOR’S COMMENT iii ABSTRACT iv TABLE OF CONTENT v LIST OF FIGURES vii LIST OF TABLES viii ABBREVIATION ix CHAPTER ONE: INTRODUCTION 1 1.1 Rationale of the study 1 1.2 Problem Statement 4 1.3 Research objectives 4 1.4 Research questions 4 1.5 Scope and limitations 5 1.6 Structure of the study 5 CHAPTER TWO: LITERATURE REVIEW 7 2.1 A brief introduction of concrete 7 2.2 Roles of and relationship between homebuilder, design consultant, supervision consultant and homeowner 12 2.3 Theoretical Framework 13 2.3.1 Customer Behavior 13 2.3.2 Organizational Buying 15 2.3.3 Consumer buying decision versus Industrial buying decision 18 2.3.4 Choice of theories constructing research model & hypotheses 19 2.3.5 Theories of Reasoned Action and Planned Behavior 20 2.3.6 Theory of Interpersonal Behavior 25 2.4 Comparison of the theories 26 2.5 Research Model and Hypotheses 27 2.6 Summary 30 CHAPTER THREE: RESEARCH METHODOLOGY 31 3.1 Research Procedure 31 3.2 Research design 32 vi MBAVB4 – FINAL PROJECT - 2011 3.2.1 Qualitative research 32 3.2.2 Quantitative research 33 3.3 Sample size 33 3.3 Data collection 33 3.4 Construction of questionnaire 34 3.5 Data Analysis Criteria 38 CHAPTER FOUR: EMPIRICAL RESULTS 40 4.1 Descriptive analysis 40 4.1.1 Descriptive statistics on variables 40 4.1.2 Sample analysis 42 4.1.2.1 Age of respondents 42 4.1.2.2 Experience 43 4.1.2.3 Education 43 4.1.2.4 Sources to find RMX suppliers 44 4.2 Empirical Results 45 4.2.1 Reliability test (Cronbach Alpha) 45 4.2.2 Exploratory Factor Analysis 49 4.2.3 Test on difference by homebuilders‟ characteristics 54 4.2.4 Regression Analysis 55 4.3 Summary 59 CHAPTER FIVE: CONCLUSION AND RECOMMENDATION 61 5.1 Conclusion 61 5.2 Recommendation 62 5.3 Limitations and Suggestions for future research 65 REFERENCE 66 APPENDIX A 69 APPENDIX B 75 APPENDIX C 83 APPENDIX D 85 vii MBAVB4 – FINAL PROJECT - 2011 LIST OF FIGURES Figure 1.1: Growth in GDP and construction sector (real rate) in Vietnam 1 Figure 2.1: Photos illustrating site mixed concrete 9 Figure 2.2: Photos depicting Batching plant & RMX concrete 9 Figure 2.3: Formula of site mix concrete 11 Figure 2.4: A Continuum of Buying Decision Behavior 15 Figure 2.5: Major stages of the industrial buying process 16 Figure 2.6: Schematic representation of the TRA 21 Figure 2.7: Schematic representation of the TPB 24 Figure 2.8: Schematic representation of the TIB 25 Figure 2.9: Proposed Research Model 28 Figure 3.1: Research Procedure 31 viii MBAVB4 – FINAL PROJECT - 2011 LIST OF TABLES Table 2.1: A Specimen of Concrete Mix Design 8 Table 2.2: Summary of hypotheses 30 Table 3.1: Constructs and Items of the Research 37 Table 4.1: Descriptive statistics on variables 40 Table 4.2: Age of respondents 42 Table 4.3: Experience of respondents 43 Table 4.4: Education of respondents 43 Table 4.5: Sources to find RMX suppliers 44 Table 4.6: Reliability test on attitude of homebuilders 45 Table 4.7: Reliability test on subjective norms 46 Table 4.8: Reliability test on perceived consequences 47 Table 4.9: Reliability test on perceived consequences after removing two items PEC4 and PEC6 47 Table 4.10: Reliability test on perceived behavioral control 48 Table 4.11: Summary result of factor reliability test 48 Table 4.12: Result of EFA on Attitude Toward Behavior 49 Table 4.13: Result of EFA on Subjective norms 50 Table 4.14: Result of EFA on Perceived Consequences 51 Table 4.15: Result of EFA on Perceived Behavioral Control 52 Table 4.16: A Summary of Qualified Variables 53 Table 4.17: Summary ANOVA results of respondent groups by age, experience and education 54 Table 4.18: Model Summary 55 Table 4.19: ANOVA 55 Table 4.20: Coefficients 56 Table 4.21: Levels of importance factors toward Intention 58 ix MBAVB4 – FINAL PROJECT - 2011 ABBREVIATION - ANOVA : Analysis of variance - ASTM : the American Society for Testing and Materials - EFA : Exploratory Factor Analysis - KMO : Kaiser-Meyer-Olkin - Mpa : Megapascal - RMX : Ready Mixed - Sig. : Significance - SPSS : Statistic Package for Social Science - TBP : Theory of Planned Behavior - TCVN : Vietnamese Construction Standard (Tiêu Chun Vit Nam) - TIB : Theory of Interpersonal Behavior - TRA : Theory of Reasoned Action - VIF : Variance Inflation Factor - W/C : Water to cement 1 MBAVB4 – FINAL PROJECT - 2011 CHAPTER ONE: INTRODUCTION 1.1 Rationale of the study Together with the economic development of Vietnam, construction sector had been growing continuously during the period of 1999-2007, nearly a decade. In general, the growth rate of construction sector was more stable than and averagely over paced Vietnam GDP growth rate in this period. Figure 1.1: Growth in GDP and construction sector (real rate) in Vietnam Source: General Statistics Office 2010, quoted from Wall Street Securities joint stock company, November 2010 From 2000 to 2009, total area was built more than 700 million square meters. Thanks to a high speed of residential construction, the national average dwelling reached 16.7 m 2 / person ( http://www.tapchibatdongsanvietnam.vn, January, 2011) For a specified illustration of construction sector development, HoChiMinh city is taken as an example. In the early 1990s, only few RMX (Ready Mixed) suppliers to serve the market demand for concrete such as Hai Au, Soam Vina, Mekong and Lephan. Since then, a number of new RMX concrete entrants have been noticeably increasing up to 15 RMX suppliers with more than 40 RMX concrete batching plants in Proportion of construction sector contributed to GDP Growth of GDP Growth of construction sector [...]... routine response behavior (the lowest involvement), limited problem solving to extensive problem solving (the highest involvement), (Howard and Sheth 196 9; Hansen 197 2; Howard 197 7; Engel, Blackwell, and Kollat 197 8; and Bettman 197 9, cited from Bettman et al, 199 1) as depicted in Figure 2.4 below MBAVB4 FINAL PROJECT - 2011 15 Figure 2.4: A Continuum of Buying Decision Behavior Source: Solomon, 2003 2.3.2... Construction Standard 2004 (TCVN 2004), specific standards for each kind of materials used to mix concrete are quoted below: TCVN 6260: 199 7 for Cement Bended Portland TCVN 4506-87 for Water TCVN 1770-86 for Sand (fine aggregate) TCVN1771-87 for Stone (coarse aggregate) ASTM C 494 -99 a for Admixture - A proportional combination of materials in concrete mix design - Ratio of water to cement (W/C) When the water... Planned Behavior Based on Fishbein & Ajzen ( 197 5), Ajzen & Fishbein ( 198 0, 2005) cited in Christine Mitchell & Elin Ring (2010), and Ajzen ( 199 1, 2002) The two theories and conceptual constructs are described below According to Ajzen & Fishbein ( 198 0) and Ajzen ( 199 1), theories of reasoned who will process information and think about the implications of behavioral actions before deciding perform or not... important referents Subjective norm is directly proportional to sum of products over n salient referents (Ajzen, 199 1) Theory of Planned Behavior (TPB) Due to the TRA limitation when predicting behaviors that are not under volitional control, Ajzen ( 198 5) developed TPB (cited in Ajzen 199 1), which is considered an extension of the TRA, to overcome the limitation of TRA and improve the predicting power... ( 199 6), consumer behavior is a study of the processes involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs and desires (cited from Khan 2006) The study of consumer behavior focuses on how individuals make decisions to spend their available resources (time, money, effort) on consumption-related items (Schiffman & Kanuk, 199 7,... making is autonomous (Sheth, 197 2, 197 3) as discussed in the previous section, and the mentioned cognitive models are applicable Theories of reason action, planned behavior and theory of interpersonal behavior will be discussed in the following sections in turn 2.3.5 Theories of Reasoned Action and Planned Behavior Based on Fishbein & Ajzen ( 197 5), Ajzen & Fishbein ( 198 0, 2005) cited in Christine Mitchell... directly proportional control beliefs (Ajzen, 199 1) 2.3.6 Theory of Interpersonal Behavior Similar to TRA and TPB, Theory of Interpesonal Behavior (Triandis, 198 0) describles an attitude-intention-behavior relationship It comprises seven factors: affect, social factors, perceived consequences, habit, facilitating conditions, intention and behavior (Triandis 198 0, quoted from Woon & Pee, 2004) The model,... consequences behavior, there are two ways: direct or indirect measure (Ajzen, 2002) The direct way is to ask questions directly in order overall attitude Expectacybehavior The EVM (Fishbein & Ajzen, 197 5, Ajzen, 199 1) states that an individual attitude toward behavior is determined by (subjective evaluation) and the strength of belief (subjective probability) Algebraically, the indirect measure of attitude... (b) is multiplied by the subjective evaluation (e attribute proportional ( ) to the sum of the resulting products over n salient beliefs (Ajzen, 199 1) MBAVB4 FINAL PROJECT - 2011 23 Normative Beliefs and Subjective Norms According to Ajzen and Fishbein ( 198 0), normative beliefs result in subjective norms and reflect the likelihood that important individuals or groups (referents) will approve or disapprove... departments (Sheth, 197 2, 197 3) Therefore, when a buying decision of a product is made by a person autonomously, it leads to industrial buying process less complex and similar to consumer buying process In connection to industrial buying process discussed in the previous section 2.3.2, Determinants of joint vs autonomous decision making in industrial buying behavior are determined by (Sheth, 197 3): Product-specific . aims to find out Factors influencing homebuilders’ intention of using ready mixed concrete when building private houses for RMX concrete suppliers to consider approaching private house segment. COMMITMENT I hereby commit that this thesis Factors influencing homebuilders‟ intention of using ready mixed concrete when building private houses has not been previously submitted for. come in which private houses are included. Unlike multi-storey buildings that the use of ready mixed (RMX) concrete is compulsory, using RMX or site mixed concrete to build private houses is more