Developing distribution strategy for Mekostar fresh-cut fruits in Ho Chi Minh City market

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MMCoM9

NGUYEN MAI VINH QUANG

NGUYEN THI MY CHI

DEVELOPING DISTRIBUTION STRATEGY

FOR MEKOSTAR FRESH-CUT FRUITS

IN HO CHI MINH CITY MARKET

MASTER FINAL PROJECT

MASTER IN MARKETING AND COMMUNICATION MANAGEMENT

Academic Tutor: Prof. NGUYEN MINH HA

Practicing tutor: HUYNH MINH NHUT

Ho Chi Minh City

(2016)

HO CHI MINH CITY OPEN UNIVERSITY UNIVERSITÉ LIBRE DE BRUXELLES

SOLVAY BRUSSELS SCHOOL OF

ECONOMICS & MANAGEMENT

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ACKNOWLEDGEMENT

First of all, we would like to express our deepest thanks to Management Board of The Fruit

Republic who trusted us to conduct the marketing strategy for Mekostar fresh-cut fruits and

provided us the wealthy information and data which are beneficial for our research and

analysis.

Next, we would like to express our sincere gratitude our advisors to Professor Nguyen Minh

Ha, and Mr. Huynh Minh Nhut. We own you a huge debt of gratitude for the continuous

support of our project. Your guidance is priceless to us.

A very special thanks to all Professors at this programme for their extremely patience and

hard work in teaching and inspiring us with their immense knowledge.

Our gratitude goes out to all those who took the time to complete our questionnaires and

surveys. Without their passion participation and input, the validation survey could not have

been successful conducted.

Nguyen Mai Vinh Quang and Nguyen Thi My Chi

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EXECUTIVE SUMMARY

The Fruit Republic is a trading company which specializes in fruits and vegetables for export

and domestic market. It is one of few agriculture companies in Vietnam which can meet the

requirement of EU market for fruits and vegetables with Global GAP certificate for products

and HACCP and BRC certificate for factory. Beside fresh fruit and fresh vegetables, fresh￾cut fruits are an innovative product category of The Fruit Republic which was launched in

domestic market under Mekostar brand and distributed mainly to supermarket chains since

2012. However, the sales of the Mekostar fresh-cut fruits recently has decreased significantly

and it has influenced to the production plan in the factory by changing the working schedule

for workers and inventory planning. Based on the request of The Fruit Republic’s

management board, our team support them to find the solutions for improving the sales

performance of Mekostar fresh-cut fruits in short term and having sustainable growth for

this product in long term.

The first step in our approach is the diagnosis phase where we tried to understand the

situation of Mekostar fresh-cut fruit and identified its problems. We conducted a market

research to get external information for key stakeholders and did some internal interviews

with the sales team of The Fruit Republic to get the internal information about Mekostar

fresh-cut fruit. In our market research, we employed both primary and secondary research to

collect data including desk research, observation, qualitative research and quantitative

research. Beside the market research, we also applied some theories which we have studied

in the master class in marketing and communication management of Solvay Business School

and Open University such as Marketing mix 4Ps model, SWOT and Porter’s five forces to

analyze the competitive environment surrounding Mekostar fresh-cut fruit, its strengths,

weaknesses, threats and opportunities in the current context.

Based on the combination of key findings from the research and results of our analysis, we

figured out some issues of Mekostar fresh-cut fruit in its existing distribution channel and

some opportunities to improve its sales performance. In conclusion, we suggested some

solutions for The Fruit Republic and one of them is the recommendation to consider to

develop a direct sales channel (Business to Customer) to distribute Mekostar fresh-cut fruits

to the office workers in the office buildings in HCMC. It may help to improve the sales

performance Mekostar fresh-cut fruit in short term and also increase the awareness of

Mekostar brand by reaching more customers directly.

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Table of Contents

ACKNOWLEDGEMENT....................................................................................................iii

EXECUTIVE SUMMARY ..................................................................................................iv

LIST OF TABLES, FIGURES AND PICTURES...............................................................vii

1. GENERAL OVERVIEW ..............................................................................................1

1.1 Background: ............................................................................................................1

1.1.1 Introduction of The Fruit Republic:.................................................................1

1.1.2 Introduction of Mekostar fresh-cut fruits: .......................................................2

1.2 Project objectives and our approach: ......................................................................3

1.3 Research design:......................................................................................................3

1.3.1 Research Objectives.........................................................................................3

1.3.2 Research methodology.....................................................................................4

1.3.3 Sample size ......................................................................................................4

1.4 Project limitation:....................................................................................................5

2. LITERATURE REVIEW ..............................................................................................6

2.1 Porter’s Five Force:.................................................................................................6

2.2 Marketing – Mix concept:.......................................................................................7

2.2.1 Product strategies:............................................................................................7

2.2.2 Price strategies:................................................................................................8

2.2.3 Place strategies:................................................................................................8

2.2.4 Promotion strategies: .......................................................................................9

2.3 SWOT analysis: ......................................................................................................9

3. ANALYSIS OF MEKOSTAR FRESH CUT FRUIT..................................................10

3.1 Marketing mix analysis of Mekostar fresh cut fruits ............................................10

3.1.1 Product analysis.............................................................................................10

3.1.2 Price analysis .................................................................................................11

3.1.3 Place analysis.................................................................................................12

3.1.4 Promotion analysis.........................................................................................13

3.2 Porter’s Five Forces analysis of Mekostar fresh-cut fruit.....................................15

3.2.1 Intensity of competitive rivalry......................................................................15

3.2.2 Threat of new competition:............................................................................16

3.2.2 Threat of substitute products..........................................................................16

3.2.3 Bargaining power of suppliers.......................................................................17

3.2.4 Bargaining power of customers.....................................................................18

3.3 SWOT analysis of Mekostar fresh-cut fruit..........................................................18

3.3.1 Strengths ........................................................................................................18

3.3.2 Weaknesses....................................................................................................19