Managing construction steel distribution channels of steel manufacturing enterprises in Vietnam

Modern marketing believes that product distribution channels are one of the four variables in the marketing mix that businesses need to build to deploy marketing efforts to the target market. Developing a product distribution channel network helps businesses build and maintain long-term competitive advantages. Because distribution channels are a set of external relationships between independent businesses in business. Creating and developing a channel system requires a lot of time, effort and intelligence... so other businesses do not easily follow. There are also many foreign books written about distribution channel management, which also present basic theoretical issues about the nature, functions and operations of distribution channels.

In the country, there are also some books written about distribution channel management. For example, in the book "Distribution Channel Management" by Associate Professor, Dr. Truong Dinh Chien (Editor-in-Chief), National Economics University Publishing House, Hanoi, 2008. It systematically mentions the contents of distribution channel management from the perspective of manufacturing enterprises as the upstream of the flows in the channel. The ideas and contents in this work are very consistent with Phillip Kotler's views and approaches on distribution channel management and that can be considered as a guideline in the activities of establishing and managing the distribution channel system of manufacturing enterprises in Vietnam. Therefore, the topic "Management of construction steel distribution channels of steel manufacturing enterprises in Vietnam" will take the ideas and viewpoints of modern marketing theory and modern distribution channel management theory as the theoretical basis, as a theoretical framework for studying the practice of distribution channel management for construction steel products of steel manufacturing enterprises in Vietnam in recent times.

In Vietnam, in recent times, there have been a number of research projects on the distribution channels of some typical products, including the steel distribution channel, which are the following topics:

- Topic "Assessing the current situation and orientation for organizing distribution channels of some major goods in our country until 2015" Mg No.: 2005 - 78 - 009 Ministry of Trade (now Ministry of Industry and Trade), by Associate Professor, Dr. Dinh Van Thanh. This topic is being

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Overall assessment, Vietnam's construction steel industry is still underdeveloped, with scattered production on a small scale, outdated technology, heavily processing from imported steel billets and semi-finished products, and has not yet exploited its potential.

The distribution channel organization model and the distribution management policy of construction steel in the Vietnamese market still have many limitations.

- Topic "Some solutions to stabilize the steel market in Vietnam", PhD thesis, University of Commerce, Hanoi, 1995 by author Nguyen Hong Nguyen.

In the thesis, the author mainly studies the issues of steel prices in the market (steel pipes, construction steel, shaped steel), deeply analyzes the factors that influence the price decisions of steel manufacturing enterprises in Vietnam, does not mention other factors such as products, distribution channels and mixed promotion and from there proposes solutions to stabilize the steel market through market prices.

- Topic "Some solutions to improve the effectiveness of marketing activities in the Vietnamese steel industry", PhD thesis in economics by Nguyen Minh Tuan, Ho Chi Minh City University of Economics, 2002.

This work is researching and evaluating the steel market in the context of international economic integration, which directly affects the production and business activities of steel manufacturing enterprises. The research topic of steel business activities in many different steel markets such as steel pipe market, steel sheet market, construction steel market, profile steel market... The construction steel distribution channel is only mentioned very little, only stopping at the level of description and generalization of common features for all types of steel products, not going into analysis to describe the current situation of distribution channel management activities of construction steel manufacturing enterprises in Vietnam.

- Topic: "Improving steel distribution activities in Vietnam".

This is a collaborative research topic between the National Economics University and Jica ( Japan), in 2003 by the group of authors: Associate Professor, Dr. Hoang Duc Than; Dr. Tran Van Hoe; Master, Nguyen Minh Ngoc; Master, Tran Thang Long.

This is a research topic on the overall distribution channel for large-scale construction steel products in Vietnam. However, the topic only stops at describing and analyzing the following aspects: Financial situation and business activities; Distribution policy; Relationships between members in the channel, does not analyze the flows in the distribution channel as well as the management of flows such as material flow, ownership transfer flow, promotion flow... does not mention the application of marketing-mix variables in distribution channel management, has not gone into depth in studying

Researching distribution channels and the distribution channel management process of specific manufacturing enterprises, the results only stop at providing macro solutions at the state management level.

- Topic " Organization and management of the distribution system of construction steel products in Vietnam" by the group of authors Nguyen Xuan Chien, Pham Kim Ngan, Le Huy Khoi, Nguyen Hoai Nam. This is a ministerial-level topic - Ministry of Industry and Trade, year 2009.

In this topic, the group of authors does not start from the theoretical foundations of distribution channels but directly studies the current situation of organization and management of distribution channels for construction steel products on the overall level of the economy, without detailed research on specific manufacturing enterprises, and is entirely macro-oriented. The solutions proposed are mostly at the macro level of State management of construction steel products in Vietnam.

- Besides the above topics, there are many master's theses of universities nationwide related to construction steel products as follows:

+ Topic "Solutions to improve the competitiveness of construction steel products of enterprises under Vietnam Steel Corporation". Master's thesis by Pham Hong Hai, National Economics University, Hanoi, 2005.

+ Topic "Some marketing measures to expand the steel business market at Ho Chi Minh City Metal Company". Master's thesis by Dao Duy Huan, Ho Chi Minh City University of Economics, 2002.

+ Topic "Product policy planning for Vietnam's steel industry until 2010". Master's thesis by Dan Duc Minh, Hanoi University of Science and Technology, 2004.

However, with the scientific works being researched, many theoretical and practical issues on distribution channel management are being analyzed and interpreted depending on the purpose, object and scope of each work, or only researched on specific aspects. Up to now, there has been no published scientific work focusing on researching the distribution channel management activities of construction steel manufacturing enterprises in Vietnam. Therefore, this thesis is not the same as the existing research works, it is the first independent research work on the management of construction steel distribution channels of steel manufacturing enterprises in Vietnam.

3. Research objectives of the thesis.

- Systematize some theoretical issues on distribution channel management of manufacturing enterprises, on that basis, determine the characteristics in distribution channel management of construction steel manufacturing enterprises.

- Analyze the current status of construction steel distribution channel management in steel manufacturing enterprises in Vietnam in recent years; assess the limitations and causes that need to be overcome.

- Based on a general and detailed study of distribution channel management, this thesis

The project proposes orientations and solutions to improve the management of construction steel distribution channels of steel manufacturing enterprises in Vietnam. At the same time, it recommends improving the necessary conditions at the macro level for the management of distribution channels of steel manufacturing enterprises in the coming time.

4. Subject and scope of the thesis research.

- The thesis focuses on the theoretical and practical research on the management of distribution channels for steel bars and steel coils of all kinds (not on shaped steel because shaped steel has a very small proportion and is not commonly produced domestically) in construction steel manufacturing enterprises in Vietnam on contents such as distribution channel organization, channel management, and evaluation activities of channel members. In addition, it also studies the macro-environmental factors and the steel industry environment that affect the channel management activities of construction steel manufacturing enterprises in Vietnam.

- The study was conducted at a number of steel manufacturing enterprises and commercial intermediaries trading in construction steel of various types of enterprises in Vietnam from 2004 onwards.

5. Research methods.

- The thesis will be approached and researched on the basis of dialectical materialism and historical materialism.

- Specific methods used include: Interview investigation method, expert method, generalization and synthesis, statistics and comparison, case study method at some steel manufacturing enterprises, including:

+ Thai Nguyen Iron and Steel Company.

+ Steel company c .

+ Viet Nhat Steel Joint Stock Company.

These three companies currently supply about 25% of the total market supply and their market share accounts for about 25% of the entire Vietnamese construction steel industry.

In-depth research on the above companies aims to clarify issues regarding the current situation as well as the advantages and disadvantages of channel structure, channel organization, as well as the management mechanism of channel members to thereby show a panoramic picture of construction steel distribution channel management of steel manufacturing enterprises in Vietnam.

- Secondary data sources are collected from specialized publications and journals, articles and information in the media, documents published domestically and internationally for analysis, comparison, and generalization to make inferential judgments.

- Primary data sources are collected through direct personal interviews with managers of agencies, enterprises producing and trading construction steel, relevant researchers and surveys, and research results that the author has participated in recently.

6. New contributions of the thesis.

- Improve and further develop the basic theory of distribution channel management of construction steel manufacturing enterprises.

- Assess the current status of distribution channel management of steel manufacturing enterprises in Vietnam. Assess the impact of factors affecting the distribution channel. Identify the main limitations in the organization, design and management of distribution channels of steel manufacturing enterprises in Vietnam.

- Propose some principles and system of solutions to improve the management of construction steel distribution channels of steel manufacturing enterprises in Vietnam.

- Propose recommendations to the State to contribute to improving the management of construction steel distribution channels of steel manufacturing enterprises in Vietnam.

7. Thesis structure.

In addition to the introduction, conclusion, list of tables, charts, list of author's research works and list of references, the thesis consists of 3 chapters.

Chapter 1

Theoretical basis of construction steel distribution channel management of steel manufacturing enterprises

Chapter 2

Current status of construction steel distribution channel management of steel manufacturing enterprises in Vietnam

Chapter 3

Solutions to improve the management of construction steel distribution channels of steel manufacturing enterprises in Vietnam

Chapter 1

Theoretical basis of construction steel distribution channel management of steel manufacturing enterprises

1.1. General issues about construction steel distribution channels.

1.1.1. Construction steel and construction steel market.

* The role of construction steel.

Steel is an indispensable strategic material for industry, construction and defense, playing a very important role in the industrialization and modernization process.

modernization of the country. Therefore, the steel industry has always been identified as an industry that is

development priority

Each stage of industrialization of the country is associated with the development of social infrastructure to meet the requirements of production and circulation of goods, strengthen the division of labor and economic linkage. One of the basic characteristics

For the economy to develop, production infrastructure, especially transportation, must be

improved to expand commercial activities. Therefore, industrialization and modernization in any country cannot be separated from investment in infrastructure construction. Therefore, construction steel always plays a role in the industries that promote the development of social infrastructure.

On the other hand, the purpose of the industrialization and modernization of the country is to develop the economy in the direction of modern industrial production, the formation of industrial parks and export processing zones to accelerate economic growth. Therefore, the construction industry is one of the industries responsible for implementing construction projects and expanding industrial parks and export processing zones, while construction steel is one of the industries providing raw materials for the construction industry. In addition, urbanization is also an inseparable process from economic development. In the urbanization program, construction steel also plays a role in providing raw materials for the construction of houses and civil works...

From the above analysis, it can be seen that construction steel holds an important position in the economy, plays a fundamental role, provides raw materials for other economic sectors in the process of industrialization and modernization of the country, and has a significant impact.

promote and accelerate the process of economic restructuring towards modernization

country.

* Characteristics of construction steel.

+ Construction steel includes steel bars, steel coils and shaped steel, with many different types and sizes, which are important input factors for the construction industry.

+ Construction steel is characterized by its large weight and bulkiness, so transportation and unloading costs are high. When consumed in markets far from the production site, the cost will increase due to high transportation costs.

+ The quality of construction steel products is shown through its mechanical, physical and chemical properties. In Vietnam, many different quality standards are applied, commonly: Russia, Japan, USA, TCVN... The set of construction steel standards issued by the Ministry of Science and Technology since 1993 is no longer suitable. In fact, construction steel products of steel rolling enterprises using modern technology

The products usually have technical specifications that ensure quality standards according to regulations.

However, steel products with more beautiful surfaces and stronger brands are often considered by consumers to be of better quality and are chosen more.

+ Is a product that is greatly affected by the natural environment.

+ The cost of construction steel products is greatly affected by the price of steel billets and steel prices on the world market and by other input factors such as electricity, gasoline, etc. This directly affects steel manufacturing enterprises, steel consumption demand, and the ability to reserve products.

+ Construction steel has a large value, so manufacturing enterprises need a large business capital. This characteristic leads to steel manufacturing enterprises often using steel distributors with large financial capacity to perform the functions of storage or deferred sales.

Thus, the characteristics of construction steel products have a great influence on the operation.

business activities of steel manufacturing enterprises and to the organization and management of distribution channel systems in the market.