Impact of opening the retail market on domestic retail businesses

The reality is that all Vietnamese distribution enterprises have not yet opened a shopping center, all large shopping centers currently belong to foreign corporations. Enterprises really need to find investment sources, possibly by calling for domestic and foreign investment sources... to increase financial potential to expand the distribution network.

2.1.1 Expanding scale through cooperation with domestic enterprises

Currently, most retail businesses in our country are small in scale and have very limited capital, so they do not have enough capital to expand their investment. Vietnamese distribution businesses can consolidate their strength to stand firm in the retail market by merging two or more businesses together, thus increasing their scale and financial strength. This is also a popular trend in the world today.

Vietnamese enterprises also need to increase joint ventures, associations, and establish large retail corporations to counterbalance foreign corporations. Moreover, the interests of domestic retail enterprises will be more secure when disputes or the risk of acquisition by foreign retail enterprises occur. Linking enterprises in the same industry will, on the one hand, quickly expand the scale of the enterprise; on the other hand, they will take advantage of each other's experiences to develop, saving time and costs for market expansion. A widespread system of dealer stores will also create conditions for enterprises to promote and develop their brands more easily. The case of China has shown that, because there is no enterprise that is "on par" with foreign retailers, the Chinese retail market has been under a lot of pressure from these powerful competitors.

Maybe you are interested!

The development of the distribution service sector in Korea has shown that, after opening the market, domestic retail distribution still exists and develops, partly thanks to the cooperation between manufacturers and domestic distributors. Learning from this experience, Vietnamese manufacturers need to

Close cooperation with domestic distributors. This not only benefits the competitiveness of retail distributors but also creates many benefits for the manufacturers themselves.

If businesses cling to the “every man wins” mindset, they will not be able to compete with foreign corporations and will sooner or later be eliminated from the game. There needs to be a connection between domestic businesses to counter foreign retail corporations.

2.1.2 Concentrating capital through expanding cooperation with banks and financial and credit institutions

Banks and financial and credit institutions are a huge source of capital that retail businesses need to take advantage of. To receive their cooperation and support, businesses need to create a good image for themselves and build their reputation in business. For projects that businesses want to borrow capital to invest in, they need to clearly show them the feasibility of the project, the attractive benefits that the project can bring and must ensure that the debt and interest will be paid on time. In negotiations, businesses need to convince banks and financial and credit institutions to lend capital.

2.1.3. Capital concentration through issuing stocks and bonds

The bond market has been formed in our country in recent years and is also an attractive source of capital that is attracting the attention of businesses. Bonds are debt papers on which the borrower and lender clearly state the maturity date and the interest rate that the bond buyer receives. Businesses that want to sell bonds must offer attractive interest rates and must create confidence for investors to be able to recover interest and capital on time.

Currently, most Vietnamese retail enterprises are cooperatives and limited liability companies, which limits enterprises in mobilizing and expanding capital for investment and development. With the stock market

Vietnam's stock market has been formed, is growing and gradually stabilizing, Vietnamese retail businesses need to take advantage of this to quickly equitize their businesses to mobilize capital from outside.

Furthermore, Vietnamese retail businesses also need to allocate resources reasonably, improve capital efficiency, and avoid waste.

2.2 Improve logistics

2.2.1 Establish close relationships with suppliers and transport companies

Suppliers are those who provide goods to retail businesses. Therefore, establishing close cooperative relationships with suppliers ensures a stable supply of goods for businesses, or enjoys higher discounts. However, businesses should not buy goods from one supplier but from many suppliers, avoiding the situation of having to depend too much on one supplier, avoiding the risk of shortage of goods when this supplier has business problems or is forced to lower prices due to market fluctuations.

Transport companies play a very important role for retail businesses. They are responsible for transporting goods from suppliers to the business's retail stores and transporting goods to consumers. Businesses need to choose reputable and responsible transport companies, ensuring that goods are not damaged during transportation and when the business has a need, they must respond as quickly as possible.

2.2.2 Purchasing and managing goods

Establish a common purchasing center, which has the function of purchasing goods and supplying them to members. This solution allows for large-scale purchases directly from manufacturers, without having to buy through intermediaries as is currently the case. Therefore, retail businesses will enjoy higher discount rates from manufacturers or suppliers.

2.3 Improving the quality of human resources

2.3.1 Focus on training and developing human resources from senior management to sales staff

Develop training programs and improve employee morale. Employee training must be performed by experienced and qualified staff or experts. A highly qualified and well-trained management team will research and find new or unsatisfied customer needs. By improving the quality of the team, improving display and sales skills, etc., service quality is increasingly improved, best meeting customer needs. This opens up new business opportunities and increases profits for the business.

If you want the business apparatus to operate effectively, the first thing you need to do is to have a plan to train and develop managers in the business. Improve the management capacity of the management staff so that they can effectively apply the principles and rules of the market economy. Create opportunities for them to access and learn modern management methods so that they can successfully apply them to their own businesses. Furthermore, businesses need to focus on training, equipping knowledge and practical skills for the next generation of staff, creating a source of staff to promptly supplement the leadership management staff.

For retail businesses, the sales staff plays a very important role in selling and attracting customers. Because the sales staff is the one who directly contacts the customers, information about the business and products will be directly introduced to customers by them. Businesses need to build a team of professional sales staff with all the necessary sales skills. A professional sales staff needs to grasp information about the product, know what customers need, understand the psychology of each customer group and have

appropriate behavior. Businesses need to regularly organize advanced training courses and gradually improve sales skills for employees.

Enterprises must also innovate applied technology to improve labor productivity and improve business efficiency.

2.3.2 Apply reasonable rewards and incentives to stimulate effective work and improve labor productivity.

Retail businesses need to create conditions for each employee in the business to develop their abilities and at the same time have reasonable reward policies for individuals and groups with high achievements in work.

High-quality human resources are one of the key and most important factors that help retail businesses stand firm and develop in today's fiercely competitive environment. However, the success of a business also depends on knowing how to stimulate the spirit of work and creativity of employees.

Enterprises should provide incentives for employees to apply knowledge, skills, and working methods; encourage the development of initiatives and contributions to improve efficiency and productivity, such as: reasonable salary and bonus policies, incentives, etc. This is also a measure to attract qualified employees to the enterprise.

2.4 Overcoming unprofessionalism

2.4.1 Retail businesses must develop a long-term business strategy and focus on market research activities.

Retail businesses need to develop short-term and long-term business strategies, which serve as a basis for determining plans for storing and purchasing goods from suppliers, making appropriate financial projections, and developing marketing strategies to promote sales and develop brands.

Strengthen market research on consumer needs, psychology, behavior and target customer positioning to find key market segments, avoiding scattered investment causing loss and waste of capital. These market segments must basically be markets with large demand, still untapped or Vietnamese retail businesses have advantages in that market.

In particular, businesses must focus on two key stages: purchasing and selling.

First, the purchasing department must always grasp the constantly changing needs and tastes of consumers and must have the skills to negotiate with manufacturers about prices, quality, designs, specifications, product packaging and even design advertising programs to "pull" customers to the supermarket, sell the most products, and bring maximum profit to the business.

The sales department must pay attention to observing and understanding the needs and tastes of customers depending on their age in terms of product type, design, color, and size, combined with analyzing sales data to provide to the purchasing department and for the business to have appropriate business strategies.

Businesses should consult, research and learn from the operating models of large foreign corporations.

2.4.2 Focus on improving service quality, especially after-sales service in a professional manner and satisfying customers.

The weakest point of Vietnamese retail businesses today is the quality of service and the accompanying value-added services. Therefore, in addition to rapid replication and expansion, retail businesses must focus on improving service quality, after-sales programs, enhancing convenience and customer satisfaction. This is a measure to encourage them to buy and become traditional, loyal customers of the business.

Businesses should consult, research, and learn from the experiences of large foreign corporations. For example, the policy for customers to return goods

within X hours if not used, free shipping if customers purchase with a minimum value of Y thousand VND, free installation and shipping... Or learn the very successful customer satisfaction motto of international retail corporations such as: "Delight customers with great value and convenience" (Australian retail corporation - Coles Myer), "Aiming to make customers happy and satisfy them with new retail ideas" (Dairy Farm Corporation of Singapore), "Retail means listening to customers and understanding why they choose your place to shop" (Tesco Lotus Corporation of Thailand)...

2.4.3 Define a unique, distinctive and different style for your business

From identifying target customers, businesses will choose a suitable model for themselves. Each supermarket and shopping mall must create its own unique style, such as: its own service style, its own logo, its own uniform for employees... Otherwise, the image of the business will be very dim in a large retail market with hundreds of similar service providers. This is a very effective marketing measure and also a way to build a brand. This is very meaningful in today's fiercely competitive environment.

2.4.4 Building and upgrading facilities, applying science and technology and modern management methods for effective business

To make retail distribution more effective and professional, businesses need to invest in upgrading and adding new facilities and systems of tools to support decision making and business and sales. For example: speeding up the upgrading and construction of new warehouse systems, distribution centers, and stores; deploying e-commerce systems; deploying ISO 9000 quality management systems, etc.

In addition, businesses also need to research and apply modern management models such as chain management, supermarket management, etc. and modern tools to control product and service costs. Thanks to that, businesses can reduce costs.

Costs for unnecessary activities, increase business efficiency, enhance business competitiveness.

2.4.5 Retail businesses need to diversify sales methods

Sales are not limited to stores but can be extended to many different forms.

Nowadays, the Internet is really popular in Vietnam. Along with the strong development in the field of communication networks, consumers can sit at home and buy products easily and conveniently. Moreover, marketing and advertising are both effective and cost-saving.

In Vietnam, retail businesses have begun to appear selling goods via the Internet and telephones such as: selling mobile phones, selling fresh flowers, food, fashion, etc., but still at a limited level.

These are very effective and cost-saving sales methods that Vietnamese retail businesses need to apply to increase their competitive advantage.