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International Marketing Plan of exporting Tire of Caosumina Co., LTD to Peru giới thiệu chung về nền công nghiệp săm lốp của Peru, Việt Nam. Ngoài ra, tài liệu này minh họa các bước cách lập một dự án Marketing Quốc tế cũng như cách nghiên cứu đánh giá thị trường thông qua SWOT, Porter 5 forces. CHAPTER I: CASUMINA’S BRIEFT INTRODUCTION CHAPTER II: PERVIAN BUSINESS ENVIRONMENT ANALYSIS
CHAPTER I: CASUMINA’S BRIEFT INTRODUCTION I.1 THE INTRODUCTION TO CASUMINA JOINT STOCK COMPANY I.1.1 THE OVERVIEW - Name: The Southern Rubber Industry Joint Stock - Abbreviate: CASUMINA - Headquarters: 180 Nguyen Thi Minh Khai, Distreet 3, Ho Chi Minh city - Charter capital: 422.498.370.000 - Mission Casumina: Dedication to social security, happiness, efficient and friendly - Vision Casumina: Leading tire manufacturers in Southeast Asia I.1.2 BRIEFT HISTORY OF FOUDATION AND DEVELOPMENT PROGRESS - 1976 - Company Southern Rubber Industry was established on 19.04.1976 by the State of Vietnam - 1997 - Establishment of Joint Venture Yokohama Tire Vietnam with partners: Yokohama and Mitsuibishi Japan to manufacture automobile tires and motorcycle - 1999 - Investing in a factory specializing in the production truck tires with modern technology - The company received ISO 9002-1994 - 2000 - The company received product certification motorcycle tires standard JIS K6366 Japan / JIS K6367 - 2001 - The company received ISO 9001 - 2000 - 2002 - Company received product certification standard car tire Japan JIS K4230 2003 - Manufacture of radial car tire V13, V14 Certificate ISO 14001-2000 2005 - Manufacture of radial car tire V15, V16 - CASUMINA contracting co-produced light truck tires with the company CONTINENTAL Germany (4th corporate world to produce the kind of car tires) - On 10/10/2005 Change of Corporation Southern Rubber Industry under Decision No 3240 / QD-BCN of the Ministry of Industry - 2006 - Casumina officially put into operation with the initial charter capital of 90 billion 11/2006 increase its charter capital to VND 120 billion - 2007 - 59/75 CASUMINA was ranked the largest tire manufacturers in the world 03/2007 increase its charter capital to VND 150 billion - Certifies Business prestigious 2007 - 2008 - Signed contract with Philips Carbon Black.LTD joint venture to produce carbon black - Increased capital to VND 200 billion MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU - 2009 - Increased capital to VND 250 billion - May 08/2009, the company officially listed 25,000,000 shares on the HCM City Stock Exchange, stock code CSM - 2009 to present: Signed contracts for technology transfer company Gaoce Qingdao - China; signed a business cooperation contract with JSC strategic investment advice and build Ba Dinh; increased capital to 422,498,370 thousand dollars I.2 BUSINESS FIELD AND ORGANIZATION STRUCTURE - Production and sales of industrial rubber products, rubber consumption - Trading, import and export of raw materials, chemicals, equipment and rubber industry - Services Commercial Business - Trading in real estate - Other business sectors in accordance with the provisions of law I.3 PRODUCTS - Car Tires: Over 120 kinds, including gong tires sold Radial full steel and tires, these are two types of products helps companies drift into a manufacturer of automotive tires and tubes light trucks in steel leading Vietnam MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU Casumina is the first enterprise in Vietnam to develop this product - Motorcycle tires Tires motorcycle, scooter: 200 different products specifications, size, inflatable maximum speed, the shipping enterprise supply products to the market since 2000 In early 1009 the company has added product lines far scooter tires premium branded EUROMINA the domestic market and quality standards errant export to caaos nature Casumina is the first E-Mart - Industrial tires Tires Car industry: more than 90 kinds of - products Agricultural tires MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU - Bicycle tires: 80 types, the traditional products of the company Casumina The company has a policy to reduce the bicycle tire to focus on products with higher value - Other products: in addition, the company also manufactures a number of ancillary products such as rubber His technique (used for transmission of water, oil, gas in the car), gloves, However, the proportion of these products contribute very little in revenue I.4 BUSINESS RESULTS - 4/2011 received the "Medal 3rd Independence" by the Party and State awarded MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU - Rating 59/75 tires manufacturer in the world - The "Export prestigious" 2008-2011 - As one of the 11 major product of Ho Chi Minh City - years hold the GOLD STAR VIETNAM 2002-2007 - The title "Hero of Labour in the reform era" in 2005 - As one of the 200 largest enterprises in Vietnam MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU CHAPTER II: PERVIAN BUSINESS ENVIRONMENT ANALYSIS II.1.MARCO-ENVIRONMENT ANALYSIS II.1.3 DEMOGRAPHIC ENVIRONMENT - Population: 30,147,935 (July 2014 est.) - Median age: total: 27 years male: 26.3 years female: 27.7 years (2014 est.) - Population growth rate: 0.99% (2014 est.) - Birth rate: 18.57 births/1,000 population (2014 est.) - Death rate: 5.99 deaths/1,000 population (2014 est.) - Net migration rate: -2.69 migrant(s)/1,000 population (2014 est.) - Urbanization: urban population: 77.3% of total population (2011) Infant mortality rate: total: 20.21 deaths/1,000 live births - Life expectancy at birth: total population: 73.23 years - Major cities - population: LIMA (capital) 9.13 million; Arequipa 804,000 (2011) - Languages: Spanish (official) 84.1%, Quechua (official) 13%, Aymara (official) 1.7%, Ashaninka 0.3%, other native languages (includes a large number of minor Amazonian languages) 0.7%, other (includes foreign languages and sign language) 0.2% (2007 est.) - Ethnic groups: Amerindian 45%, mestizo (mixed Amerindian and white) 37%, white 15%, black, Japanese, Chinese, and other 3% - Religions: Roman Catholic 81.3%, Evangelical 12.5%, other 3.3%, none 2.9% (2007 est.) - Health expenditures: 4.8% of GDP (2011) - Education expenditures: 2.8% of GDP (2012) II.1.4 ECONOMIC ENVIRONMENT II.1.4.1 Overview The Peruvian economy, which is the seventh largest in Latin America, has experienced a structural change in the past three decades Currently, the services sector is the main contributor to the country’s GDP, with nearly 60% of GDP stemming from this sector Telecommunications and financial services are the main branches of the services sector; together they account for nearly 40% of GDP However, the country still has a long way to go toward the modernization and competitiveness of its service sectors Industry, which represents around 35% of GDP, has undergone MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU a process of modernization, which has translated into increased employment in the country’s primary industrial areas The combination of economic modernization, natural resource abundance and continued improvements in economic governance and political stability that have been taking place, are helping Peru to emerge as one of the most stable economies in Latin America II.1.4.2 Peru Economic Data 2009 2010 2011 2012 2013 Population (million) 29.1 29.6 30.0 30.5 30.9 GDP per capita (USD) 4,177 5,029 5,705 6,316 6,557 GDP (USD bn) 121.5 148.6 171.2 192.5 202.9 Economic Growth (GDP, annual variation in %) 1.0 8.5 6.5 6.0 5.8 Consumption (annual variation in %) 4.3 8.2 5.8 6.4 5.5 Investment (annual variation in %) -1.6 23.1 6.0 16.3 7.6 Manufacturing (annual variation in %) -6.7 10.8 8.6 1.5 5.7 Retail Sales (annual variation in %) -0.5 12.5 8.9 7.2 5.9 Unemployment Rate 8.4 7.9 7.7 6.8 6.0 Fiscal Balance (% of GDP) -1.4 -0.2 2.0 2.3 0.9 Public Debt (% of GDP) 27.2 24.3 22.1 20.4 19.6 Money (annual variation in %) 10.6 33.8 13.7 25.3 5.9 Inflation Rate (CPI, annual variation in %, eop) 0.3 2.1 4.7 2.7 2.9 Inflation Rate (CPI, annual variation in %) 2.9 1.5 3.4 3.7 2.8 Inflation (PPI, annual variation in %) -1.8 1.8 6.3 1.8 0.4 Policy Interest Rate (%) 1.25 3.00 4.25 4.25 4.00 Stock Market (annual variation in %) 99.3 66.4 -16.7 5.9 -23.6 Exchange Rate (vs USD) 2.89 2.81 2.70 2.55 2.80 Exchange Rate (vs USD, aop) 3.01 2.82 2.75 2.64 2.70 Current Account (% of GDP) -0.5 -2.4 -1.9 -3.3 -4.5 Current Account Balance (USD bn) -0.6 -3.5 -3.2 -6.3 -9.1 Trade Balance (USD billion) 6.1 7.0 9.2 5.2 0.0 Exports (USD billion) 27.1 35.8 46.4 46.4 42.2 Imports (USD billion) 21.0 28.8 37.2 41.1 42.2 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU Exports (annual variation in %) -12.6 32.1 29.6 0.1 -9.1 Imports (annual variation in %) -26.1 37.1 29.0 10.3 2.7 International Reserves (USD) 33.1 44.1 48.8 64.0 65.7 External Debt (% of GDP) 28.9 29.4 28.1 30.8 30.0 - Exchange rates: nuevo sol (PEN) per US dollar - 2.699 (2013 est.) - Exports from Peru In Peru, ores and minerals exports make up over 50% of total exports, food accounts for 21% and mineral fuels account for 12% As in many resource-rich countries with a traditional export-led growth model, international trade and financial conditions have largely affected the performance of the external sector In fact, the economy as a whole has been affected by these conditions, even considering that domestic demand has been the main driver of growth in recent years Due to favorable conditions in international trade, the country has experienced growth in real goods and services exports of 6.3% annually since 2000 That said, in the same period, imports have expanded at an average 8.5% annually, thus outpacing the strong performance in exports In nominal terms, merchandise imports have reached the size of exports, which caused 2013 to close with a zero trade balance surplus According to FocusEconomics Consensus Forecast panelists’ projections from June 2014, Peruvian exports are expected to expand in the coming years following a contraction in 2013 Panelists see exports increasing to USD 43.7 billion in 2014 and tallying an annual growth rate of 3.5% For 2015, panelists expect exports to increase to USD 47 billion In 2018, panelists expect exports to reach USD 63.6 billion and to record an annual growth rate of 12.1% - Imports to Peru Peru’s imports are mainly composed of final and intermediate goods, as opposed to exports, in which minerals and ores account for the majority of overseas sales Imports of machinery account for roughly a quarter of the total value Whereas these figures suggest the modernization of the national industry through private investment, they have not yet weighed on the trade balance Since 2002, imports have not offset exports, although they have been expanding at a faster level since then In fact, given the weaker performance of exports in the first half of 2014, imports are likely to outweigh exports and drive Peru’s trade balance to the first deficit since 2001 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU II.1.5 INFRASTRUCTURE Peruvian government has prioritized the development of transport infrastructure (road, rail, ports and airports) to increase competitiveness and set up a logistics hub that integrates Latin America, with the Asia – Pacific economic region During the period of 2005-2010, Peru had a slight improvement in some sectors such as water, sanitation and electricity, but there is a big gap in vial projects, railways, health, among others As an example, nowadays there are only four railroads in the country, mostly used to transport minerals or for tourism Peru requires more investment in roads and railway infrastructure to serve the transport of persons, facilitate trade and the connection between remote places and main cities During the period of 2003-2012, the Transport Sector began to improve its investment rates with the following results: Railways 3%, Airport 10%, Ports 11%, ;Roads 76% One of the current requirements of infrastructure is to pave the roads of the national network and connect the country These projects were improving the infrastructure sector and the possibilities for international companies II.1.6 POLITICAL – LEGAL ENVIRONMENT - Government type: constitutional republic - Capital: name: Lima - Administrative divisions: 25 regions (regiones, singular - region) and province* (provincia); Amazonas, Ancash, Apurimac, Arequipa, Ayacucho, Cajamarca, Callao, Cusco, Huancavelica, Huanuco, Ica, Junin, La Libertad, Lambayeque, Lima, Lima*, Loreto, Madre de Dios, Moquegua, Pasco, Piura, Puno, San Martin, Tacna, Tumbes, Ucayali - Independence: 28 July 1821 (from Spain) - Legal system: civil law system - International organization participation: APEC, BIS, CAN, CD, CELAC, EITI (compliant country), FAO, G-24, G-77, IADB, IAEA, IBRD, ICAO, ICC (NGOs), ICRM, IDA, IFAD, IFC, IFRCS, IHO, ILO, IMF, IMO, IMSO, Interpol, IOC, IOM, IPU, ISO, ITSO, ITU, ITUC (NGOs), LAES, LAIA, Mercosur (associate), MIGA, MINURSO, MINUSTAH, MONUSCO, NAM, OAS, OPANAL, OPCW, Pacific Alliance, PCA, SICA (observer), UN, UNASUR, UNCTAD, UNESCO, UNIDO, Union Latina, UNISFA, UNMIL, UNMISS, UNOCI, UNWTO, UPU, WCO, WFTU (NGOs), WHO, WIPO, WMO, WTO - Flag description MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU II.1.7 NATURAL ENVIRONMENT - Location: Western South America, bordering the South Pacific Ocean, between Chile and Ecuador - Climate: varies from tropical in east to dry desert in west; temperate to frigid in Andes - Deforestation (some the result of illegal logging); overgrazing of the slopes of the costa and sierra leading to soil erosion; desertification; air pollution in Lima; pollution of rivers and coastal waters from municipal and mining wastes - Natural resources: copper, silver, gold, petroleum, timber, fish, iron ore, coal, phosphate, potash, hydropower, natural gas - Natural hazards: earthquakes, tsunamis, flooding, landslides, mild volcanic activity II.2.MIRCO-ENVIRONMENT ANALYSIS II.2.3 COMPETITORS: II.2.3.1 Group Neuma Peru: Function: Neuma Peru imports, distributes and sells tires for mining, construction and transport in line Michelin, world leader market enterprise We experience technical have in control in extensive monitoring and tire and management enllante in mines, the workshops Tire Repair 10 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU institutional and macroeconomic stability is seen as capital to allow for the country’s achievement of its development goals II.3.2.2 Peru Economic Outlook GDP increased just 1.0% annually in Q4, which was weaker than the 1.8% expansion tallied in Q3 As a result, the economy expanded 2.4% in the full year 2014, which was well below the 5.8% growth seen in 2013 and marked the slowest growth since 2009 Falling investment and subdued private consumption dragged on growth, although a large fall in exports was the main factor behind the deceleration Weak global demand and low prices for Peru’s commodity exports exerted significant pressure on the external sector last year, although a modest recovery in the mining industry is expected this year Meanwhile, the government is hoping to boost growth with a series of large public-private infrastructure projects, but it remains to be seen if this will fuel momentum II.3.2.3 Peru’s Balance of Payments In the last decade, Peru has changed its external position from being a net international creditor to a net debtor However, its external position remains solid After registering surpluses between 2004 and 2007, the current account balance has accumulated deficits since then This change has come on the back of the progressive narrowing of the trade balance surpluses that had been in place since 2002 Whereas the service and the factor income balances have been broadly stable, the transfers’ balance—which mainly accounts for international remittances—has remained in surplus, although it has been narrowing in the last years The corresponding capital inflows benefit from a strong contribution from Foreign Direct Investment (FDI), which has performed strongly in the last decade with a record of USD 12.2 billion inflows in 2012 Among the countries that invest the most in Peru are Spain, the United Kingdom and the United States Nearly a quarter of the total FDI is attracted by the mining sector and nearly the half of it is II.3.2.4 split among the financial, communications and industry sectors Peru’s Trade Structure Despite the progressive improvement of internal demand, the external sector’s performance continues to be of crucial importance to the Peruvian economy As a country rich in natural resources, it exports goods that are highly subject to price volatility, whereas it imports industrial goods, prices of which are less volatile Therefore, Peru’s external position remains vulnerable to changes in the terms of trade (i.e., the relative price of exports over the price of imports) The country has benefited from a steady improvement in its terms of trade since 2000, which helped keep the 21 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU trade balance in positive figures up until 2013 The trade balance peaked at a record-high surplus of USD 9.8 billion in February 2012 It has narrowed uninterruptedly since then and shifted to deficit in December 2013 This trend has been driven by falling global demand and decreasing prices for traditional Peruvian exports, such as copper, silver and natural gas The increase in import volumes has also affected the trade balance negatively Moreover, the country has engaged in several bilateral and multilateral trade agreements that have opened new markets for its exports Peru joined MERCOSUR in 2005, and between 2006 and 2013 it signed several bilateral treaties with other Latin American and Caribbean economies In addition, in 2006 Peru and the United States signed the United States-Peru Trade Promotion Agreement (PTPA), which has been operative since 2009 II.3.2.5 Economic Freedom Peru’s economic freedom score is 67.7/100, making its economy the 47th freest in the 2015 Index Its score is 0.3 point better than last year, with improvements in freedom from corruption, labor freedom, and monetary freedom outweighing declines in business freedom, the management of government spending, and fiscal freedom Peru is ranked 8th out of 29 countries in the South and Central America/Caribbean region, and its overall score is above the world average Peru is committed to free trade More than 80% of trade is covered by Free Trade Associations (FTAs), including one with the European Union Peru had a founding role in the freetrading Pacific Alliance bloc and participates actively in the Trans-Pacific Partnership negotiations It is also a member of the WTO, Andean Community and APEC II.3.2.6 Peru has the following rankings in recent world economic surveys: - Peru was ranked 4th by Bloomberg among “best emerging countries for investment” in 2014 - Ranked by the World Bank as the 42rd easiest country to business in (‘Ease of Doing Business’ report), making it second in the region - Peru tops Grant Thornton’s list of the best prospects among emerging markets (beating the BRICs- Brazil, Russia, India and China) Peru has also topped the Global Microscope Ranking, produced by the Economist Intelligence Unit, for the last six years, highlighting its sophisticated legal and regulatory framework and competitive microfinance sector - Peru also ranked 65th in the World Economic Forum’s Global Competitiveness Report The report highlighted that Peru continues to benefit from a very strong macroeconomic 22 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU - Performance and efficiency in goods, financial and labor markets’ However, Peru can benefit from strengthening its institutions, by ‘increasing efficiency and infrastructure’ These positive assessments reflect Peru’s strong legal framework, which promotes and protects foreign investors´ interests With a no discrimination policy between national and foreign companies, the Constitution and associated legal framework guarantee private property rights, the fulfilment of contracts, free capital transfer and remittance of earnings, unrestricted access to internal and external credit and unrestricted access to most economic sectors with only a few exceptions II.3.3 SOCIATY II.3.3.1 POPPULATION Peru has a growing population that since 1950 has increased 200% In 2014, Peru’s population is estimated at 30,911,183 Its current population density is just 24 people/km2 (or 59/square mile), which makes it the 191st densely populated country Peru is one of the 26 fastest growing countries, and its population is predicted to reach 42 million by 2050 Peru Sex Ratio 2014: 50.115% Male / 49.885% Female II.3.3.2 LANGUAGE Spanish is spoken by approximately 84% of the Peruvian population, making it by far the most widely spoken language in Peru It is also the main language of the Peruvian government, the media, and the education system Quechua (13%) is the second most common language in Peru and the most widely spoken native language Quechua speakers are mostly in the central and southern highlands of the country 23 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU Only about 1.7% of Peruvians speak Aymara, but it remains the 3rd most widely spoken language in Peru In modern-day Peru, speakers of Aymara are located almost entirely in the deepsouth, along the border with Bolivia and around Lake Titicaca II.3.3.3 MAJOR URBAN ARES The largest city in Peru is its capital city, Lima It is home to more than a quarter of Peruvians and the country's largest city by far with a population of more than million Lima's wider metropolitan area is home to 8,472,935 people, making it the 22nd largest city in the world, equivalent more or less to London and the 6th largest in South America The only larger cities are Mexico City (Mexico, 22.6 million), Sao Paolo (Brazil, 20.5 million), Buenos Aires (Argentina, 14.5 million), Rio de Janiero (Brazil, 12.1 million) and Bogota (Columbia (8.5 million) II.3.3.4 Human Development Index (HDI) With an average Human Development Index of 0.762, Peru comes mid-way in the world ranking (79 out of a total of 177 countries) Of the Andean countries, Peru comes after Venezuela and Colombia, and in terms of Latin America it comes after Argentina, Chile, Uruguay and Brazil The level of development indices are focused in Metropolitan Lima, in the provinces of Costa, in areas of greatest demographic concentration, in the most urban areas, and in areas nearest the capitals Table A: Peru’s HDI trends based on consistent time series data and new goalposts 1980 1985 1990 1995 2000 2005 2010 2011 2012 2013 Life expectancy at birth Expected Mean GNI per years of years of capita (2011 HDI value schooling schooling PPP$) 60.1 63 65.5 68 70.5 72.4 73.9 74.2 74.5 74.4 10.9 11.7 12 12.3 13.6 12.8 8.8 13.1 13.1 13.1 5.5 5.9 6.6 7.3 8.4 13.1 8.9 9 10,495 8,783 5.369 6.625 6.67 7.436 9.737 10.212 10.907 11.28 0.595 0.616 0.615 0.646 0.682 0.694 0.722 0.727 0.734 0.737 II.3.3.5 POVERTY RATIO The percentages of the population living in poverty and extreme poverty in the last two decades have remained practically constant, although in absolute terms the population in this situation has increased considerably, especially in the cities In 2003 around 14.7 million people, i.e 54.7% of the population, were considered poor 56.8% in rural areas (8.34 million) and 43.2% in 24 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU urban areas (6.35 million) An estimated 15.5% of the total population is in a situation of extreme poverty, which is worse in rural areas (4.8 million people in rural areas and million in urban areas) The regions with the highest rates of poverty and extreme poverty are in the Central mountain range (Huancavelica, Huánuco, Apurimac and Ayacucho) The rates are also high in Cajamarca, Cusco and Puno and in the forest regions (Amazonas, Loreto and Ucayali) The relatively low percentages of poverty in Lima nevertheless conceal a high incidence of poverty and extreme poverty in absolute terms II.3.3.6 HOFSTED’S NATIONAL CULTURE DIMENSIONS http://geert-hofstede.com/peru.html II.3.3.6.1 Power distance Superiors consider subordinates as being of a different kind and ask for respect – particularly if the latter are of black or indigenous origin II.3.3.6.2 Individualism With a value of 16 Peru shows a very collectivistic score, in line with most other Latin American countries Among other consequences, it is interesting to highlight that in general people here find large companies attractive and that, particularly among blue collar workers, the involvement with the company is moral – and not calculative Managers endorse more traditional points of view 25 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU and only slowly start supporting employee initiative and group activity In general they aspire to conformity and prefer having security over having autonomy in their position II.3.3.6.3 Masculinity 42 is considers as low score (feminine) on the dimension means that the dominant values in society are caring for others and quality of life A feminine society is one where quality of life is the sign of success and standing out from the crowd is not admirable The fundamental issue here is what motivates people, wanting to be the best (masculine) or liking what you (feminine) This trait has been the source of many cultural clashes and misunderstandings For expatriates, locals were aloof or downright lazy The actual reasons, however, were the locals weaker achievement motivation, their preference for human contacts and family over recognition or wealth, and the marginal role awarded to work by large sectors of the population II.3.3.6.4 Uncertainty avoidance At 87 Peru scores high on UAI – and so the majority of Latin American countries that belonged to the Spanish kingdom These societies show a strong need for rules and elaborate legal systems in order to structure life The individual’s need to obey these laws, however, is weak Corruption is widespread, the black market sizeable and, in general, you´ll see a deep split between the “pays réel” and the “pays legal II.3.3.6.5 Long Term Orientation This dimension describes how every society has to maintain some links with its own past while dealing with the challenges of the present and future With a low score of 25, Peruvian culture is more normative than pragmatic People in such societies have a strong concern with establishing the absolute Truth; they are normative in their thinking They exhibit great respect for traditions, a relatively small propensity to save for the future, and a focus on achieving quick results II.3.3.6.6 Indulgence One challenge that confronts humanity, now and in the past, is the degree to which little children are socialized Without socialization we not become “human” This dimension is defined as the extent to which people try to control their desires and impulses, based on the way they were raised Relatively weak control is called “indulgence” and relatively strong control is called “restraint” Cultures can, therefore, be described as indulgent or restrained 26 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU II.3.4 TECHNOLOGY II.3.4.1 TELECOMMUNICATION Peru is increasing its telecommunications capacity rapidly as well Success started in 1993 when the industry was privatized and now is experiencing growth from internet to radio and TV Mobile phone is another growing industry that is dominated by Movistar Peru with over 66% of the market share II.3.4.2 INTERNET The use of communications technology is growing steadily in Peru As of 2010 34.3% of the population uses the internet There are over 15 internet providers in Peru In 2013, 22.6% of homes in Peru have a connection to the internet, which is a 3.6% increase from 2012 In the Lima metropolitan area, 41.7% of homes have access to the internet, up 7.1 percentage points from 2012 However, many people who not have access to home internet are regular internet users It is reported that 38.4% of people ages and up use internet nationwide Of those who use the internet, 44.1% access it from home, and 44.6% access it from a public internet cafe Furthermore, 13.7% of people access the internet at work, and 7.0% from an educational institution II.3.4.3 LOGISTICS Peru's relatively developed logistics network is a regional outperformer in the BMI Logistics Risk Index, with an above average score of 59.2 out of 100, placing the country in 52nd place out of 170 nations globally Within Latin America, Peru is ranked 4th out of 28 countries, behind only Panama, Chile and Mexico An insufficient level of investment into the maintenance and development of Peru's transport networks has left the country with a low score of 46.7 out of 100 for Transport Quality, the country's worst logistics rating in BMI's index The score places it 84 th out of 170 countries globally and 12th out of 28 states in Latin America However, this is likely to improve with the government planning to invest USD15bn over the next years With the exception of the country's 8,808km of navigable waterways, Peru suffers from a substandard network of transport The country's road and rail network are far from extensive, forcing many cities to be reliant on a single major road for freight transport The lack of transport diversity has placed huge pressure on the country's roads and ports, leading to threats of congestion, which can increase logistics costs for businesses II.3.4.4 MINING INDUSTRY 27 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU Peru is a multi-metallic country that has one of the world’s largest mining reserves It is presently the 3rd largest global producer of silver, zinc, tin and copper - and expected to reclaim its place as the world’s 2nd largest copper producer in 2014 Within Latin America, Peru is the largest producer of gold, zinc, tin and lead During 2013 Peru attracted US$ 10 billion investment in the mining sector and mining exports were estimated at US$22.75 billion, representing 55.2 per cent of Peru’s total estimated exports of US$ 41.2 billion at the end of 2013 The estimated overall investment portfolio in mining for the next ten years is nearly $60 billion and is comprised of 47 main projects in various phases of mine expansion, advanced exploration and projects with an approved environmental impact assessment Approximately 60 per cent of the portfolio is comprised of copper projects, 16 per cent of gold projects, 1.5 per cent of silver projects and 12 per cent of iron projects The large proportion of mining in GDP drives out the urgent need for off-the-road (OTR) mining equipment including tires which are used in very harsh conditions due to climates, bad road surfaces and heavy payloads II.3.4.5 AUTOMOTIVE INDUSTRY Chronology of the automotive industry 1920 Production of wooden bodies and hoppers 1940 Manufacture of simple parts, tires and metal body 1963 in corporating national parties were encouraged to provide that for every additional 10% of domestic auto parts on the total value of the vehicle is reduced by 1% tariff 1965 there were up to automotive assembly plants in operation 1966 there were automotive assembly plants in operation 1967 Increase the number to 13 automotive assembly plants in operation: Ford, GM, British Leylans, Fiat, International Harvester, Toyota, Isuzu, Nissan, Scania Vabis, Volkswagen, Chrysler, Volvo and Rambler 1970 Automotive tender won by Toyota del Peru SA, Nissan Motor del Peru Sa 1994 toyota del Peru SA restarted its industial activities with the assemblu of the truck Pick Up Toyota Stout According to Automotive Association of Peru (AAP) there were 192.300 new vehicles sold in 2013 representing an increase of 8% compared to 2012, among that, there were 85.422 were cars In 2014, there were 210.000 new vehicles sold It is hoped that the number would reach 300.000 by the year 2020 II.5.PORTER’S FORCES 28 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU II.5.1 COMPETITIVE RIVALRY Today, just six giant companies, one in the process of formation, are dominant The only one biggest in Peru is the Goodyear Tire and Rubber Company Companies in this industry manufacture tires and inner tubes for a variety of vehicles Major companies include Goodyear and Cooper (US), Michelin (France), Bridgestone Corporation and Sumitomo Rubber Industries (Japan), Continental AG (Germany), Pirelli (Italy), and Hankook (South Korea) The total population is over 30 million people in 2014 but more than million people live in the capital _ Lima citi and nearly million live in Arequipa Those figures point out a high concentration market The fast growing automotive industry equals to a fast tire industry All tire manafacturers have to deal with the increasing natural rubber price in recent years and until 2018 as said by experts II.5.2 POTENTIAL ENTRANTS: Threat of new entrants New manufacturers of tires cannot represent a problem for the large companies in this sector In order to achieve a sustainable profitability in the tire market, it is necessary a - High level of capital investments - A specific know-how of the entire production process - Well developed distribution channels - High sunk costs limit competition - Strong brand names are important - Industry requires economies of scale - Advanced technologies are required - New entrants must be aware of strict environmental and safety regulations imposed by governments No threat from potential entrants II.5.3 SUPPLIERS: Power of Suppliers - The key inputs to the tire and rubber market includes synthetic and natural rubber, metals and equipment for manufacturing - Suppliers play a key role in improving the competitive position in this business because they are large and few in number 29 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU - Raw material suppliers can exercise high pressure on the prices for their input materials in tire manufacturing due to strong competition in a rather commoditized market High bargaining power II.5.4 BUYERS: Power of Buyers - Clients could be divided into categories: - Vehicle manufacturers (for mounting as the original equipment) who pay attention on quality and performance of tires - Highly concentrated market - Low switching cost for buyers - Sales depend on automotive market trends - High bargaining power - Aftermarket (tire repairers, retailers, garages and fast fitter) focused on distribution service of regional warehouses - Not concentrated buyers - Low switching cost for buyers - Small size buyers Low bargaining power II.5.5 SUBSTITUTES: Threat of substitutes - The only threat can be caused by the increasing of public transport that reduces use of car - High switching costs: customer cannot easily switch to other products or services of similar price and still receive the same benefits - Limited number of substitutes: customers cannot easily find other products or services that fulfil their needs No threats from substitutes II.6 SWOT ANALYSIS II.6.1 S (STRENGTHS) Leading position in tire and tube industry In Vietnamese market, Caosumina is the leading company accounted by 35% the market share for Motor tire, 25% for Auto tire and 25% for bike cycle tire 30 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU Market share of different companies in Vietnamese tire and tube market (2014) Others 32% Casumina 33% DRC 25% SRC 10% In 2014, the growth rate of Casumina was 30% which remains stable from 2009 despite the fact in recent years, the price of raw material is greatly fluctuated and the competition between not only domestic companies, FDI ones like Kumho, Bridgestone, Michelin but also Chinese companies offering low price products… is more and more fierce In global tire and tube market, from 2004, Casumina continuously appeared in the list of 75 biggest tire and tube manufacturers all over the word In 2012, Caosumina takes the 66th place with revenue from tires in 2011 was 1.385 million USD, in 2010 was 1.351 million USD and in 2009 was 1.261 million USD High capacity of production Caosumina is investing 2.000 billion VND in seting up Radial full steel tirefactory whose productivity is 600.000 tires/ year form 2013-2015 and 1.000.000/year afterward The Radial full steel tire occupied most of developed countries’ tire market such as: USA, Japan, Europe… described by 60% - 90% of the total consumption of tire The Radial full steel tire factory of Casumina is equipped with the most mordent technology as well as equipment of countries in G7 and installed completely by famous experts and by Casumina’s experienced engineers Casumina radial factory creates the big advantage in competing in domestic market but also in foreign market Large market and distribution system 31 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU Casumina owns a large domestic distribution system consisting of over 200 first level agents all over Vietnam Moreover, its products are traded in 38 countries and territories including strict markets like USA and EU accounted for 20% in Casumina’s revenue In January of 2015, Caosumina officially signed the contract with the Us Tirex company to become the exclusive distributors of Radial full steel tire to USA According to this contract, in 2015, Casumina would export 200.000 tires which equals to 57 million USD With this success, Casumina has claimed the high quality of its products and the position of the company in foreign market Quality Casumina’s products are produced according to the most up to date standards of Japan such as: JISK6366, K6367, D4230… Moreover, the quality control system is applied the international standards including ISO 9001, DOT, E-Mark, SNI From 2000, Casumina has been accepted by foreign market Human resources Casumina’s directors and managers have enormous capacity for management In addition, staff of the company is well-trained and experienced The working environment is friendly and inspiring Casumina takes the human factor to be the core success of the company, so that, it always creates chances to develop and has appropriated remuneration policy Raw material zone Vietnam owns a vase natural rubber zone which makes Vietnam to be the 5th biggest exporting natural rubber in the world Moreover, the fact that Casumina hold 10% stocks of Phuoc Hoa rubber company and invests in some other famous rubbers companies like Da Nang rubber company and Dong Phu rubber company helps Casumina not only always has enough natural rubber for tire manufacturer but also reduces risk when the price of natural rubber charges In another hand, in order to produce carbon black powder which is the key raw material in tire manufacturing, Casumina cooperates with the Philip carbon black Company of India together with makes full use of the advantage of domestic carbon black power supply II.6.2 W (WEAKNESS) Because of urgent need for innovating equipment, Casumina company always need large capital Moreover, the continuous expansion results in the shortage of working capital and the 32 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU late payment policy for agents make the company suffer capital appropriation Thus, the marketing expense in Peru would be lowered Casumina is major in producing tire for bike and motorbike not the tire for vain and heavy truck while the need for off-the-road tire for heavy truck used in mining is increasingly get higher in Peru II.6.3 O (OPPORTUNITY) The Peruvian automotive industry increases sharply with 201.000 new vehicles purchased in 2014 and the number can climb to 300.000 in 2020 Nevertheless, tires and tube are always on the top of import list of Peru Car is always accounted for large number in the total number vehicles on the Peruvian streets which fit with the specialization of Casumina company The income per capita of Peruvian people is about 5.196 USD/year which is greater 4.5 time than that of Vietnamese So that, Peruvian citizens would accept the Radial full steel tire which is more enduring but more expensive comparing with normal tire II.6.4 T (THREATEN) The price of natural rubber in the past year has been continuously decreasing The farmers loose the trust and cutting down rubber trees which contributes to make the price fluctuate Limited communication is occurs as Peruvian mostly use Spanish instead of English This is the first time Casumina enters Peru so that it does not have much experience with the customer behaviours as well as practices in doing business there Entering Peru, Casumina products have to confront with the products of leading tire manufacturers such as Goodyear of USA, Pirelli of Italy and with low price ones of Chinese companies 33 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU CONCLUSION ON ENTRY MODE After comprehensively studying the capacity of production of Casumina Company as well as analysis of Peru’s tire market, there some highlight views can be pointed out are: - Casumina is a famous tire manufacturer in Vietnam but not to be so in the foreign market as its products only sold in 38 different countries and territory - Shortage of capital because of continuously expansion and capital appropriation - Peru is totally strange market not only to Casumina but also to most of Vietnamese companies except the giant ones are Viettel and Petrol Group - Competitors in Peru are famous tire manufactures all over the world which has strong capacity of finance and high productivity Those are reasons why we choose the entry mode direct exporting 34 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU LIST OF REFERENCE “Introduction of Casumina Company” a http://www.casumina.com/home.php b http://www.cesti.gov.vn/the-gioi-du-lieu/doi-net-ve-nganh-sam-lop.html “Macro-environment” a http://rru.worldbank.org/BESnapshots/Peru/default.aspx b http://www.latinvex.com/app/article.aspx?id=662 “Competitors” a http://www.neumaperu.com.pe/ b http://www.pirelli.com/tyre/ar/es/news/2014/08/18/pirelli-inaugura-sus-operacionesen-peru/ “Mining industry” a http://latinlawyer.com/reference/topics/46/jurisdictions/19/peru/ “Tire market size” a http://automotive.einnews.com/country/peru 35 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU [...]... MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU The automotive sector began accelerating year According to the Automotive Association of Peru (AAP), a total of 19,964 new vehicles were sold and registered in January at the Land Registry Vehicular, representing an increase of 39% compared to the same period of 2012 when 14,314 units were registered According to the type of vehicle, 8,567 cars... Casumina enters Peru so that it does not have much experience with the customer behaviours as well as practices in doing business there 4 Entering Peru, Casumina products have to confront with the products of leading tire manufacturers such as Goodyear of USA, Pirelli of Italy and with low price ones of Chinese companies 33 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU CONCLUSION... market not only to Casumina but also to most of Vietnamese companies except the 2 giant ones are Viettel and Petrol Group - Competitors in Peru are famous tire manufactures all over the world which has strong capacity of finance and high productivity Those are reasons why we choose the entry mode direct exporting 34 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU LIST OF REFERENCE 1... capacity of production Caosumina is investing 2.000 billion VND in seting up Radial full steel tirefactory whose productivity is 600.000 tires/ year form 2013-2015 and 1.000.000/year afterward The Radial full steel tire occupied most of developed countries’ tire market such as: USA, Japan, Europe… described by 60% - 90% of the total consumption of tire The Radial full steel tire factory of Casumina. .. countries and territories including strict markets like USA and EU accounted for 20% in Casumina s revenue In January of 2015, Caosumina officially signed the contract with the Us Tirex company to become the exclusive distributors of Radial full steel tire to USA According to this contract, in 2015, Casumina would export 200.000 tires which equals to 57 million USD With this success, Casumina has claimed... manufacture of tires for vehicles, announced the start of its operations in the Peruvian market due to the growth experienced by the automotive market Business result In 2013 reported 1.5 million of products for cars and 700,000 for buses and trucks In the remainder of 2014, Pirelli plans to add five new outlets in addition to the 40 that the tire manufacturer already has in Peru until 2016, the plan is to. .. Chrysler, Volvo and Rambler 1970 Automotive tender won by Toyota del Peru SA, Nissan Motor del Peru Sa 1994 toyota del Peru SA restarted its industial activities with the assemblu of the truck Pick Up Toyota Stout According to Automotive Association of Peru (AAP) there were 192.300 new vehicles sold in 2013 representing an increase of 8% compared to 2012, among that, there were 85.422 were cars In 2014,... FULL STEEL TIRE TO PERU late payment policy for agents make the company suffer capital appropriation Thus, the marketing expense in Peru would be lowered 2 Casumina is major in producing tire for bike and motorbike not the tire for vain and heavy truck while the need for off-the-road tire for heavy truck used in mining is increasingly get higher in Peru II.6.3 O (OPPORTUNITY) 1 The Peruvian automotive... number can climb to 300.000 in 2020 Nevertheless, tires and tube are always on the top of import list of Peru 2 Car is always accounted for large number in the total number vehicles on the Peruvian streets which fit with the specialization of Casumina company 3 The income per capita of Peruvian people is about 5.196 USD/year which is greater 4.5 time than that of Vietnamese So that, Peruvian citizens... most common language in Peru and the most widely spoken native language Quechua speakers are mostly in the central and southern highlands of the country 23 MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU Only about 1.7% of Peruvians speak Aymara, but it remains the 3rd most widely spoken language in Peru In modern-day Peru, speakers of Aymara are located almost entirely in the deepsouth, ... helps companies drift into a manufacturer of automotive tires and tubes light trucks in steel leading Vietnam MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU Casumina is the first... Agricultural tires MARKETING PLAN FOR SELLING CASUMINA RADIAL FULL STEEL TIRE TO PERU - Bicycle tires: 80 types, the traditional products of the company Casumina The company has a policy to reduce... tender won by Toyota del Peru SA, Nissan Motor del Peru Sa 1994 toyota del Peru SA restarted its industial activities with the assemblu of the truck Pick Up Toyota Stout According to Automotive Association