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Improving the competitiveness of Song Hong Garment Joint Stock Company in the domestic market - 8

- Always care about the environment, working conditions and increasing employee income.

- Committed to continuously contributing to community development and environmental protection.

- Continue to improve the application of advanced software to ensure productivity, quality, and improve management efficiency.

3.1.2.Opportunities and challenges of the company

a) Opportunity

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- Currently, the domestic market is gradually becoming attractive to companies in the garment and bedding industry. With a population of 92 million and an increasing level of spending on consumer products, this market is considered to have development potential for Song Hong Garment Joint Stock Company. Therefore, this is an opportunity for the company to improve its production capacity to serve the domestic market, capture market share and increase profits for itself.

- Song Hong Garment Company owns a safe financial potential with stable business capital and sufficient working capital to conduct business most effectively. This makes it easy for the company to purchase modern machinery and equipment or expand production scale, proactively implement the company's business plans without having to bear the pressure of interest costs from the bank and easily mobilize loans when necessary.

Improving the competitiveness of Song Hong Garment Joint Stock Company in the domestic market - 8

- With Vietnam signing many bilateral free trade agreements as well as participating in large economic organizations, it has created opportunities for the company to export products to partners in the US and EU markets. Creating a premise for introducing the image and promoting the quality of the company in the international market, attracting investment from foreign investors.

- Vietnam's legal system on basic competition law has been completed and promulgated by the state, contributing to promoting an increasingly healthy competitive business environment in the market.

b) Challenges

- Because Vietnam has participated in the integration into the international economy, at the same time, the signing of free trade agreements between the parties has removed tariff barriers, causing many foreign competitors with experience, brands and strong capital to participate in the Vietnamese market, competing directly with domestic enterprises. Especially for enterprises in the garment industry when facing

Competitive pressure on price and product quality for big fashion brands and Vietnamese people's preference for "foreign" goods.

- The company's management has begun to apply the available ERP enterprise management system along with new software management tools to increase accuracy and timeliness in production and business management. In addition, the company has also built an automated machinery system and 3D printing technology for a number of production lines, catching up with the trend of applying 4.0 technology in the garment industry. However, the above innovation of the company has only been assessed as a half change and has not changed in depth because, for the most part, with the specific characteristics of the garment industry, the sewing stage still requires experienced workers, it is not possible to completely change the synchronous machinery, and the company's workforce is mostly at the general level, and not many workers have been trained to meet the requirements of digitizing some stages in the production line.

- Exchange rates have a great impact on the production and business activities of import-export enterprises. For Song Hong Garment Joint Stock Company, due to the implementation of a number of transactions and loans in foreign currencies, the company will be exposed to risks when there are fluctuations in the exchange rate between Vietnamese Dong and the corresponding foreign currency. Especially in the context that the company is having to collect a bad debt from a long-term partner in the US who suddenly declared bankruptcy.

- The bottleneck for the Vietnamese garment industry lies in the fact that the scale of the yarn, dyeing and supporting industries is not commensurate with the development of the garment industry, so the supply of raw materials cannot meet production needs in both quantity and quality. Most of the raw materials in the Vietnamese market are still imported, with the largest suppliers mainly coming from China, posing many challenges for businesses in the industry in managing input costs as well as finding alternative sources of supply. Since raw material costs often account for a large proportion of the cost structure of garment companies, any fluctuations in raw material prices will have a clear impact on the gross profit margin and production and business results of the enterprise.

3.2. Solutions to improve the competitiveness of Song Hong Garment Joint Stock Company in the domestic market.

3.2.1.Building a market research team

A product when completed must mostly meet the needs of current consumers and to consume good products, the company must research and study the market to find out the criteria and expectations of the product from consumers. Therefore, building a market research team

Professionalism is essential in the current situation of the company when it wants to improve its competitiveness in the domestic market.

A market research team will consist of 5 members (both sales and marketing staff) with high professional qualifications and market sensitivity. The team's tasks will be carried out as follows:

+ Timely reflect information on changes in demand (models, designs), and at the same time detect new trends in the domestic market. Develop specific production and consumption plans, closely follow the market to understand market needs, tastes and trends as well as market fluctuations during the product's life, thereby providing product orientations that are suitable for the actual situation.

+ Periodically analyze and evaluate the competitiveness of competitors. For each company operating in the same industry, this is considered an important step because the above evaluation will help the company have a view of its advantages and disadvantages compared to competitors in the same industry to promptly adjust and improve in the future. Moreover, evaluating and researching competitor companies does not simply come from implementing measures to cope with each company's strategy, but is also an opportunity for the company to learn from experience and further improve its competitiveness.

+ Research the level of acceptance of the domestic market for the product. The research on the level of market acceptance will be conducted by the team through the following steps: Step 1: Research competitive products, set up a set of criteria to evaluate its technical level, quality and legal protection (patent rights) - to determine the market's ability to accept competitive products, thereby drawing conclusions.

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Step 2: Research consumer reactions and product acceptance from your company through surveys to collect information about consumer reactions to products, requirements for design, quality, price and after-sales service, etc. To be able to draw conclusions to compare customer preferences or the company's shortcomings with competitors' products.

Promoting marketing activities or building a professional market research team will always be a necessary step for Song Hong Garment Company to improve its competitiveness in the domestic market.

3.2.2. Perfecting and improving product quality

The company needs to select products with strengths, focus on improving and developing to better suit the increasingly advanced criteria of customers. Proactive

Diversify products to further expand the low, medium and high-end customer segments. Continue to implement the principle of selecting suppliers to ensure good input material sources for the company.

In addition, to improve product quality, the company needs to pay attention right from the product design stage, planning during the production process because product quality is guaranteed throughout the preparation and production stages according to the standards set out in the design.

In addition, the company can improve product quality by investing in machinery and equipment, improving production technology to increase the ability to automate the production process. Because machinery and equipment have a great impact on the quality of the company's products. Outdated and asynchronous machinery and equipment will cause damage, stop production, waste labor, and affect the volume and quality of products according to plan. Thus, investing in modernizing machinery and equipment to improve product quality as well as help improve the company's competitiveness is a necessary and urgent measure.

Thus, to produce good quality products, the company needs to manage well all stages of the production process, from purchasing raw materials for production, preserving raw materials, designing models, production technology, labeling and packaging to checking product quality. In addition, the company must have the right product strategies to meet the diverse needs of the market and minimize competition through price competition strategies or product differentiation, depending on the actual situation.

3.2.3.Build a specialized department for business strategy planning

Currently, for the domestic market, the strategy building work of Song Hong Garment Company has not been focused on, has not been done systematically, has only stopped at the form of senior leaders planning each year, has not had a long-term strategic vision for the company's future development, especially has not analyzed, evaluated and fully exploited the strengths and resources for this market. In order for domestic production and business activities to be increasingly more effective and have a long-term vision, the company must build a specialized department to plan domestic business strategies based on the coordination of functional departments.

Regarding the department's tasks: Based on the analysis and forecast of changes in the business environment and within the enterprise, this department will develop strategies from short to long term, from high level to grassroots level. At the same time, it will be responsible for monitoring and checking the implementation of the strategy, adjusting the strategy to suit the actual conditions of the business environment and within the enterprise.

In addition, the company can invite experts to work as collaborators, especially in the field of bedding and mattresses to consult more opinions on the current market situation, technical requirements, and advanced technologies in the world, thereby having strategic orientations for investment, research and development.

3.2.4. Use capital wisely

To expand production and develop the company's business, the need for capital is very large. The company needs to implement solutions to have enough capital for operations such as:

- Increase working capital, build good projects with feasible plans: through highly effective plans, the company can mobilize capital from shareholders, borrow capital from banks and credit institutions, etc.

- Bank loans: maintain relationships and reputation, take advantage of short-term and long-term loan sources from credit institutions, especially credit institutions that have had long-term relationships with the company such as: Vietnam Joint Stock Commercial Bank for Investment and Development - Nam Dinh Branch, Bank for Agriculture and Rural Development - Nam Dinh Branch, Vietnam Prosperity Joint Stock Commercial Bank, etc.

- Use bank loans effectively: the company needs to develop a plan to use loans effectively, avoid over-investment in inappropriate technology leading to a lack of working capital, which will affect production and business capacity, and inability to pay debts. The company needs to periodically re-evaluate capital sources from scale, structure, and level of capital response to the company's capital use efficiency to make timely adjustments.

- Strive to increase capital turnover for each production and business activity, reducing inventory time to the lowest level.

- Joint ventures and associations with companies in the industry, investors with financial and human resources potential, etc. to have large capital sources for production and business activities.

3.2.5. Improve labor productivity and labor skills

Employees are always closely linked to the success or failure of a business. Whether a company is competitive or not depends on the level, quality and commitment of its employees to the company. Therefore, in other words, employees are the assets of the company. Therefore, in order to exploit and effectively use human resources, the company needs to develop a training program for employees. Training methods can be tutoring in production, organizing classes at the company or allowing employees to attend formal training courses. In addition, to improve professional qualifications, the company should organize seminars to exchange experiences, technical seminars, launch production emulation movements... That is an effective measure to help employees in the company improve their understanding of all aspects of the company.

In addition, the company needs to establish clear rules and disciplines that everyone must comply with to ensure discipline while working. On the other hand, it is also necessary to establish a regime and policy to encourage capacity development such as the company should focus on timely rewards, financial rewards will have the most effective promotion effect that managers often use to better manage employees.

Currently, the company still has a number of long-term leaders and thus management may not keep up with the development of the times. Improving the qualifications of the leadership team and administrators is a decisive factor in improving competitiveness. This management team participates in all business activities, so it has a great influence on the company's performance. Moreover, the company needs to have a plan to recruit competent managers, recruit skilled workers, and have a good understanding of the technology field to replace those with poor working ability in order to create a workforce sufficient in quantity to ensure quality throughout the business process. Only then can we ensure competitiveness in the market as well as with our competitors. This measure has received a lot of attention from companies and is increasingly being paid more attention to.

3.2.6.Maintain and develop a strong brand

Song Hong Garment Joint Stock Company's bedding and mattress products have long had a brand compared to competitors in the same industry. The brand is an invisible passport for products to reach consumers in the most convenient way, it helps protect the product and helps the company expand its goals according to chain effects. Therefore, maintaining and developing the brand is always a necessary process for businesses in a competitive environment. To develop the brand, the company must always ensure the following:

- Implement a synchronous, long-term promotional strategy, with a unique and consistent message through many communication channels, both static communication such as text, documents... as well as dynamic communication such as television, internet,... The company must pay attention to using short, concise and individual messages to make it easy for consumers to recognize the company's products.

- In-depth research on technology (structure, seams, production technology...), design, build parameter systems, standardize for each type of product, suitable for many consumer groups and registered according to world production standards.

- Design standard labels for each type of product, upgrade the finishing process to produce products with beautiful, attractive appearance and always guaranteed quality.

- The company's board of directors must have a long-term development strategy and a vision that is consistent with the company's development in order to develop the brand.

3.2.7. Increasing productivity and labor skills

To increase labor productivity, ensure effective business operations. In addition to investing in purchasing additional equipment, building and expanding business facilities,

In the new business, the company needs to focus on arranging labor to suit the professional qualifications and ability to meet the work of the workers. Currently, the number of female workers accounts for a large proportion of the total number of workers of the whole company (75% - 85%). This difference often has a great impact on labor productivity and work quality when women also have to take on the role of mother. In addition, female workers are suitable for light work that requires meticulousness and precision, not guaranteed to do heavy work or be in charge of machinery and technical repair. This greatly affects labor productivity and the competitiveness of the company. To limit the above points, the company should have policies to recruit more male workers, arrange them into specialized technical positions as well as arrange more male workers in departments such as accounting, marketing department, and planning department of the company because these departments have a large number of female workers while the number of male workers is small. then little

In addition, to improve labor skills for employees, companies should focus on implementing the following solutions:

- Review the company's workforce, cut out unnecessary or low-productivity workers in all stages of the business process from indirect to direct production.

- Focus on recruiting and providing appropriate remuneration to technical staff and designers with professional qualifications and high creativity to create many new products that meet the increasingly high tastes and demands of domestic consumers.

- Strengthen training programs for skilled workers, managers, designers, specialized engineers, etc. through on-site training or domestic and foreign courses. Continue to cooperate, recruit workers, and search for potential students from universities and colleges in Nam Dinh province (such as the University of Industrial Economics and Technology, Nam Dinh Industrial College, etc.) as well as from universities nationwide.

- Increase the skilled sewing workers to expand the market

inland.

- Enhance personal responsibility, work efficiency, encourage self-reliance

the initiative and creativity of each individual. Put the right people in the right positions to promote the working capacity of employees and the business efficiency of the company.

- Strengthen policies to maintain and attract workers. Prioritize highly skilled workers with material and spiritual benefits. Create a comfortable working environment and mentality for workers. Improve salary and bonus regimes in line with market income to encourage workers to work with high productivity, attract brainpower and skills for the company.

- Strictly implement the monitoring and inspection mechanism and have a reasonable reward mechanism to stimulate departments to operate effectively. Create learning opportunities for career development and promotion opportunities for employees in the company.

3.2.8.Improving business management skills

The company needs to flexibly apply a modern management organization model, adapting to changes in the business environment. In order to promote the role of the departments.

within the company, creating cohesion within the company, while opening up opportunities for cooperation and resource mobilization with external partners.

Clearly define the functions, tasks, powers, responsibilities, and relationships between departments, put the company's operations in order, and avoid overlapping functions and tasks between departments. The company needs to regularly maintain and ensure the balance and strengthen the relationship between stages and departments in the production process, etc. to enhance the sense of responsibility and creativity in production of each officer and employee in the company.

For the current management staff of the company, it is necessary to implement well the policies and regimes on salary, allowances, non-salary support, advanced training regime, etc. Solving well the policies and regimes has a great effect in encouraging staff to work with peace of mind, stick with the company, and maximize their intellectual capacity in organizing production and business. At the same time, it is a great source of encouragement for staff to strive to practice and study to improve their management level.

In addition, the company needs to innovate policies to attract and recruit new good managers with commitments such as: appropriate job placement, salary increase based on ability, promotion opportunities, valuing intellectual contributions in performance evaluation, high remuneration, etc.

3.3. Proposals and recommendations to the State

Firstly, the state needs to create a competitive environment for businesses to be equal in the production and business process. Creating a healthy business environment will help businesses promote their operational capacity and compete in the context of integration.

To promote healthy competition, the bedding and mattress industry needs to enhance the ability to fully and synchronously coordinate between units, eliminate discrimination against non-state enterprises, create the most favorable conditions for enterprises to develop together and innovate regulations to attract foreign investors, creating a rich and diverse competitive environment. Thanks to that, Vietnamese bedding and mattress enterprises can learn production and management experience as well as transfer technology with foreign partners.

Second, the state needs to coordinate with the Vietnam Textile and Apparel Association to proactively have a strategy to invest in developing the bedding industry and supporting industries in a focused manner to be able to meet the raw material needs of the industry. In particular, the Vietnam Textile and Apparel Association needs to play a more active role in supporting the provision of information and market research, introducing partners for Vietnamese bedding manufacturing enterprises in general and Song Hong Garment in particular. At the same time, the association must also perform well its role as a coordinating agency, on a voluntary basis in terms of quantity and price between enterprises, in order to avoid competition that causes damage to the enterprises themselves.

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