Determining the Importance of Competitive Environment Factors

(23/133), hotels (31/133). At the same time, according to CNNGo, TripAdvisor's TripIndex 2012 report (Travel Ranking Index) released last week provided statistics on the cheapest tourist destinations in the world in 2012, in which Hanoi topped the report with the lowest price among 48 tourist cities surveyed. From this, it can be seen that the cost of a trip to Vietnam is quite low, so it is very attractive to foreign tourists. So the tourism industry reacts averagely to this factor, giving a score of 2. Compared to the whole industry, Ky Nghi Viet Company has reasonable tour prices. Giving a score of 3.

Factor 3. Tour guide team:

To attract international tourists to Vietnam, it is necessary to have a team of tour guides fluent in international languages to guide international tourists about domestic tourism products. According to statistics, the total number of international tour guides nationwide (as of the end of May 2011) is 5,272 people. Of which, tour guides using English are 2,863 people, French: 872 people, Chinese: 694 people, Japanese: 349 people, German: 329 people, Russian: 237 people and 171 people using other languages including: Spanish, Thai, Italian, Korean, Lao, Bulgarian, Indonesian, Romanian and Hungarian. Compared to reality, only the number of tour guides using English is enough to meet the demand for tour guide services of tourists. Score 3, because this factor has a positive impact on the industry and the Company.

Factor 4. Distribution network:

Expanding domestic distribution channels and developing distribution systems to most of the world's key tourist countries and promoting marketing activities to contribute to promoting the image of Vietnamese tourism and attracting more and more tourists to Vietnam as well as bringing more and more Vietnamese people to all five continents. Scoring 1, the company's distribution network is still small.

Factors 5 and 6. Marketing; Partnership Network:

The travel company has extensive partnerships and is a member of international tourism associations, so it has many opportunities to advertise its travel products, river and cruise tourism. To ensure sustainable growth and attract more tourists. The company also has a strong marketing strategy. Scoring 3, the company responds well to both of these factors.

Factor 7. Financial strength:

Strong finance helps the company have more budget for market research and development. Brings many competitive opportunities for the company with the company's financial advantage. So this factor has a good impact on the industry and the company, score 2.

Table 2.8. Determining the importance of competitive environment factors

Strategic factors	Level of importance to manufacturing industry	Impact on business career	Value	Viewpoint weight
1	Product and service quality	3	3	9	0.16
2	Price competitiveness	2	3	6	0.11
3	Tour guide team	3	3	9	0.16
4	Distribution network	2	1	2	0.03
5	Marketing	3	3	9	0.16
6	Partnership Network	2	3	6	0.11
7	Financial strength	2	2	4	0.07
8	Trademark	3	3	9	0.16
9	Customer support and sales staff attitude	1	3	3	0.05
Total				57	1.00

Maybe you are interested!

After calculating the important points for each competitive environment factor, I chose 2 famous companies (SaiGon Tourist and Fiditour) to research. Does Ky Nghi Viet Company have a competitive advantage or not?

The basis for the important ranking of three companies (Ky Nghi Viet, SaiGon Tourist, Fiditour) in response to each competitive environment factor:

- Factor 1: Product and service quality: All three companies have similar tourism products and quality. (See the tourism programs of Ky Nghi Viet Company - Appendix 5). And these tourism programs are currently popular and meet the needs of tourists. Score 3 for the three companies.

- Factor 2: Price competitiveness: based on comparing the prices of some tour programs of Ky Nghi Viet Company and other tour companies for groups of 10 people, it shows that: The same type of tour but the prices of each company have a big difference. SaiGon Tourist offers a lower price, followed by Ky Nghi Viet Company, and Fiditour offers the highest price. (See table 2.9 below). So give 4, 3 and 2 points respectively to SaiGon Tourist, Ky Nghi Viet and Fiditour.

Table 2.9. Comparison of prices of some tour programs of Ky Nghi Viet company and other tour companies for a group of 10 people

Unit: VND/ 10 guests

Cambodia Tour 4 days/ 3 nights (Transportation: Airplane)

Hue - Hoi An - My Son Tour - 4 days/3 nights

Holiday

Vietnamese

Fiditourist

Saigon

Tourist

Holiday

Vietnamese

Fiditourist

Saigon

Tourist

102,580,000

113,460,000

99,900,000

56,800,000

67,000,000

54,950,000

- Factor 3: Tour guide team + Factor 9: Customer support and service attitude of sales staff: All 3 companies have a team of tour guides that meets the needs and also have backup plans such as a team of reserve collaborators. Score 3 for the three companies because they respond well to these two factors.

- Factor 4: Distribution network:

At present, the company has a larger distribution network than the other two companies. Saigon Tourist has its headquarters at 23 Le Loi, District 1, Ho Chi Minh City. The company also manages 8 subsidiary travel companies; at the same time, it opened a company website to promote the company's image and products. In second place is Fiditourist (including: Headquarters located at 129 Nguyen Hue, District 1, Ho Chi Minh City and 5 branches: Fiditour Hang Xanh, Cho Lon, Hanoi, Da Nang, Can Tho and 1 main website. Meanwhile, Ky Nghi Viet Travel Company is only in third place, the distribution network is not large, only 1 Headquarters and 1 main website, but the company has known how to use the strength of information technology to promote products through personal advertising pages of sales staff. Based on the above, the three companies can be scored as follows: SaiGonTourist: 4, Fiditour: 3, Ky Nghi Viet: 2.

- Factor 5: Marketing:

All three companies use websites and international social networks to promote and offer many discount programs for the company's travel products. At the same time, they participate in international fairs and organize events to find more sources of customers and partners. Score 3 for the three companies.

- Factor 6: Partnership network:

When a business has a wide range of partnerships and cooperation in the business field, it will greatly help the business in many aspects (for example, proactive supply sources, proactive output, cooperation will help expand the market, proactive distribution channels, etc.).

Speaking of this partnership, we must mention Fiditourist with its close relationship with more than 1,500 domestic and foreign partners, being an official member of international tourism associations: Vietnam Tourism Association (VTA), Ho Chi Minh City Tourism Association (HTA), Pacific Asia Travel Association (PATA), American Society of Travel Agents (ASTA), Japan Tourism Association (JATA), International Air Transport Association (IATA). Score 4.

Next is Saigon Tourist, an official member of world tourism organizations such as PATA, JATA, USTOA, and has cooperative relationships with more than 200 international travel service companies from 30 countries. Score 3.

Ky Nghi Viet Travel Company also has cooperative relationships with 735 domestic and foreign partners. In addition, it is an official member of international tourism associations: Vietnam Tourism Association (VTA), Ho Chi Minh City Tourism Association (HTA). Score 2.

- Factor 8: Brand:

Thanks to the brand, tourists will feel secure when booking tours at these travel companies. Therefore, building a brand is very important for businesses.

Saigontourist is rated by the Vietnam National Administration of Tourism as one of the leading enterprises in the tourism sector due to its positive contributions to the development of the country's tourism industry.

Fiditourist also has an equally prestigious brand, winning the title "Second place in the top domestic travel agencies in Vietnam 2009", the title "Most satisfied foreign travel service"; "Best service product in 2010".

Both Saigontourist and Fiditourist are professional travel companies that have been awarded the title of "Top ten international travel agencies" by the Vietnam National Administration of Tourism and the Vietnam Tourism Association for many years.

Meanwhile, Ky Nghi Viet Travel Company is a newly established company with small market share and no big brand.

So give 3, 2, 1 points to SaiGon Tourist, Fiditour and Ky Nghi Viet companies respectively.

- Factor 7: Financial strength:

To objectively assess the financial situation of the three travel businesses, I compared some financial ratios of Ky Nghi Viet Company, Saigontourist, Fiditourist (See table 2.10) below:

Table 2.10. Comparison of some financial ratios of Ky Nghi Viet Company with Saigon Tourist and Fiditourist

Financial ratios

Unit	Viet Holidays		Saigon Tourist		Fiditourist
Unit	2010	2011	2010	2011	2010	2011
1. Solvency ratio
Current Ratio	Time	1.01	1.78	3.97	2.75	1.09	1,566
2. Financial structure
Total Debt/Total Assets	Time	0.33	0.21	0.24	0.22	0.66	0.651
3. Activity ratio
Fixed asset utilization efficiency	Time	2.6	2.5	1.4	1.31	19.6	17.2
4. Profitability Ratios
ROS	%	9.96	12.5	11	4.1	1.91	1.46
ROA	%	14.5	12.5	7.5	2.6	4.8	3.31
ROE	%	21.6	22.8	9.88	3.3	14.2	9.5

(Source: Business performance report and Balance Sheet of Ky Nghi Viet Travel Company, Fiditourist, Saigon Tourist see appendix 1 -2 -3 -4)

Note: Figures are collected and recalculated (for the travel and tourism business sector only).

Comment:

- Regarding payment ability: All 3 companies under consideration have quite good quick liquidity, ensuring financial security. - The current payment ratio of Ky Nghi Viet Travel Company in 2011 is higher than in 2010 (and greater than 1). This shows that the current assets of the enterprise are sufficient to ensure the payment of short-term debts. Thus, in general, the liquidity situation of the enterprise is good.

- About financial structure:

The debt-to-equity ratios of all three companies are relatively low, and they are trending down. This shows that all three companies have good debt control. However, they have not fully exploited their debt capacity.

Total debt/Total assets of Viet Holiday Travel Company (2011 was 0.21) is still too low, this shows that currently there is little use of debt to finance assets. Thus, it can be said that the Company's financial autonomy and ability to borrow is high.

- About operating ratio:

Fixed asset utilization efficiency: This ratio of companies tends to decrease. This ratio decreases - it reflects the company's operating situation is tending to decrease.

not good, has created a low net revenue compared to fixed assets, and also shows that the company is using fixed assets ineffectively.

- About profitability:

+ The sales profit ratio of Fiditour companies is quite poor. In 2011, the sales profit ratio of Viet Holidays Travel Company increased quite well, while SaiGon Tourist and Fiditour continued to decrease. In general, the company's sales profit is higher than that of its competitors, because the company focuses on a few product categories.

+ Return on assets ratio: The profitability ratio of Viet Holidays company is the highest among the three companies, because in the past year the company did not invest in more machinery,

Business operations are quite effective, the profit earned on assets is increasing. This ratio is also quite high, it means that 1 dong of assets spent brings in 12.5 dong of profit (2011).

+ The company's after-tax profit on equity tends to increase and is very different from SaiGon Tourist and Fiditour.

In summary, the company's financial situation is quite good and stable, however, the company's financial capacity is weaker than SaiGon Tourist and Fiditour, so the company does not have many advantages to expand into other services like SaiGon Tourist and Fiditour. SaiGon Tourist scores 4, Fiditour and Ky Nghi Viet scores 3.

After determining the level of response of each company to each factor, I created a CPM table to determine the weights achieved by the companies, to evaluate the competitiveness of Ky Nghi Viet Company compared to SaiGon Tourist and Fiditourist. The CPM table is created as follows:

Table 2.11. Competitive Image Matrix (CPM)

STT

Strategic factors	Level of importance	Viet Holidays		Fiditourist		Saigon Tourist
Strategic factors	Level of importance	Class	Key Points	Class	Key Points	Class	Key Points
1	Product quality – service	0.16	3	0.48	3	0.48	3	0.48
2	Price competitiveness	0.11	3	0.33	2	0.22	4	0.44
3	Tour guide team	0.16	3	0.48	3	0.48	3	0.48
4	Distribution network	0.03	2	0.06	3	0.09	4	0.12
5	Marketing	0.16	3	0.48	3	0.48	3	0.48
6	Partnership Network	0.11	2	0.22	4	0.44	3	0.33
7	Financial strength	0.07	3	0.21	3	0.21	4	0.28
8	Trademark	0.16	1	0.16	2	0.48	3	0.64
9	Customer support and Sales staff service attitude	0.05	3	0.15	3	0.15	3	0.15
Total		1.00		2.57		3.03		3.40

Comment: With an important score of 2.57, it shows that Ky Nghi Viet Travel Company has a relatively good competitive ability in the tourism market. However, compared to two big competitors with long-standing formation, Saigon Tourist and Fiditour, the competitive ability of Ky Nghi Viet Travel Company is quite poor.

2.3. Internal environment analysis

2.3.1. Management activities

Planning work:

The company's forecasting and planning work is practical and scientific. The forecasting work is based on information about the annual number of domestic and foreign tourists in the tourism market. However, the forecasting work is also partly based on intuition, so the results of implementation are significantly different from the plan (see table 2.12, table 2.13).

Table 2.12. Comparison of implementation results with the 2010 plan

Target

Unit	Plan	Perform	Difference	Proportion(%)
Inbound Customers	People	1568	1511	-57	-3.64
Outbound Customers	People	548	498	-50	-9.12
Domestic guests	People	327	307	-20	-6.12
Total visitors	People	2443	2316	-127	-5.20

(Source: Inbound and Outbound Department of Viet Holiday Travel Company)

Note: negative percentage (%) indicates negative variance. Actual results are lower than planned targets.

Table 2.13. Comparison of implementation results with the 2011 plan

Target

Unit	Plan	Perform	Difference	Proportion(%)
Inbound Customers	People	1600	1647	47	2.94
Outbound Customers	People	652	754	102	15.94
Domestic guests	People	425	483	58	13.64
Total visitors	People	2677	2884	207	7.73

(Source: Inbound and Outbound Department of Viet Holiday Travel Company)

The results of the two tables above show that there is a large difference between the planned and actual results. The quality of such forecasts is not good and is not reliable enough to be used as a basis for planning.

Organization

The company's apparatus is organized according to the functional online model. The head is the branch director, under which are the deputy directors and departments and divisions. The functional online model is suitable for small and medium-sized enterprises, with the advantages of being simple, compact, and saving management costs. However, the disadvantage is that it is difficult for leaders to oversee all aspects of the company's operations. (See the organizational chart of the Viet Holiday Travel Company - Diagram 2.1).

Leader:

The leadership function is performed quite well in this organizational structure. The management board is professionally competent, creative, enthusiastic and interested in business and employees. They create good working conditions for employees.

Check:

The best control function is in accounting – finance, cost. However, the company still does not have good control over the tour guide force.