Suggested Capital Mobilization Project for Purchasing New Vehicles in order to Conduct the Driving Training Operation at the Driving Test Centers – Ho Chi Minh City College of Transportation :Masters thesis of Business Administration

MEIHO UNIVERSITY

Graduate Institute of Business and Management

MASTERS THESIS

Suggested Capital Mobilization Project for

Purchasing New Vehicles in order to

Conduct the Driving Training Operation

at the Driving Test Centers

– Ho Chi Minh City College of Transportation

In partial fulfillment of the requirements for the degree of

Masters of Business Administration

Advisor: Dr. Chih-Shing Tau

Co-advisor: Dr. Nguyen Van Hoa

Graduate Student: Nguyen Thi Thuy Ngan

December, 2010

I

ACKNOWLEDGMENTS

I owe a great many thanks to a great many people who helped and supported me during

the writing of this thesis.

First of all, a deepest gratefulness to my supervisor, Dr. Chih-Shing Tau, whose

encouragement, guidance and support from the initial to the final level enabled me to carry

out this thesis.

I also wish to thank to Nguyen Van Hoa for his kindness on evaluating my thesis as a

second supervisor and his willingness to help me whenever I need.

Then I am indebted to thank Mr. Nguyen Trong Diep, my boss as well as my classmate,

and many of my colleagues to support me and encourage me to complete this task so that I

will not procrastinate in doing it. I would like to express my deep sense of gratitude to all

experts, especially to Mr. Duong Tu Luc, Mrs. Truong Thi Huong Viet, Mrs. Le Minh Thu,

Mr. Nguyen Minh Tri, and Mr. Quach Hong Ha, for their valuable advice on in some stages

of my research. Special thanks go to my friends who had always directly and indirectly

supported me as well as offered me much of valuable instructions, suggestions and advice

during my study process.

Above all, a special thank to my husband, my sons for the great love and encouragement

for me throughout the 2-year EMBA course. My deepest thanks go to my parents and

parents-in-law who helped me to look after my sons while I was studying and injured after a

serious accident.

Lastly, I offer my regards and blessings to all of those who supported me in any respect

during the completion of the study.

II

Suggested Capital Mobilization Project for

Purchasing New Vehicles in order to

Conduct the Driving Training Operation at the

Driving Test Centers– Ho Chi Minh

City College of Transportation

ABSTRACT

Socializing education, health, cultural activities is an important and long-term method in

economic, social development strategy of Vietnam. To perform socializing policy, the

government encourages public career departments to implement to mobilize capital by

contributing shares, contributed capital from worker in the departments, mobilizing other

cooperated capital resources via cooperation, association with enterprises, economic

organization, financial organization, domestic and abroad individuals to invest in building

material facilities.

HCM City College of Transportation is a state school; it has a driving-training center

and a driving-test center to teach driving and serving the test to issue driving license. Because

the requirement of learning driving will continue to increase therefore the college has

advocated to mobilize capitals to purchase driving-school cars in order to increase driving￾training flow. Hence, the capital mobilization project for the driving test center is very

important. The research aimed at seeking out solutions for optimal capital mobilization

project for purchasing new vehicles in order to conduct the driving training operation at the

Driving Test Centers– Ho Chi Minh City College of Transportation. The In-depth interview

was conducted with interviewees are academic experts and experts in transportation,

education, finance. They are now the senior managers; experts have a lot of experiences in

the domain of learning and work to find out effectively capital mobilization project. Their

responses were analyzed to get the answers for the research questions.

Keywords: Driving Test Centers, Capital Mobilization Project, Capital Loan from Bank,

Capital from Staff Members, Capital Budget.

III

Suggested Capital Mobilization Project for

Purchasing New Vehicles in order to

Conduct the Driving Training Operation at the

Driving Test Centers – Ho Chi Minh

City College of Transportation

Contents

ACKNOWLEDGMENTS .........................................................................................................I

ABSTRACT..............................................................................................................................II

Contents .................................................................................................................................. III

Tables .................................................................................................................................... V

Figures ................................................................................................................................... VI

Chapter1 Introduction ............................................................................................................... 1

1.1 Background and Motivation ........................................................................................... 1

1.2 Research Purposes, Objectives and Questions ............................................................... 4

1.3 Research Scope and Limitations..................................................................................... 5

1.4 Research Procedure......................................................................................................... 6

1.5 Definition of Terms ........................................................................................................ 7

Chapter2 Literature Review...................................................................................................... 9

2.1 General Theory of Production Investment Capital ......................................................... 9

2.1.1 Capital definition. .................................................................................................... 9

2.1.2 Characteristics........................................................................................................ 10

2.1.3 The role of business production capital. ................................................................ 12

2.2 Structure of Business Production Capital ..................................................................... 12

2.2.1 Fixed capital........................................................................................................... 13

2.2.2 Current capital........................................................................................................ 14

2.3 Forms of Capital Mobilizing......................................................................................... 15

2.3.1 Provision resource from internal of enterprise. ..................................................... 15

IV

2.3.2 Provision resource from external........................................................................... 16

2.4 Factors Influence the Ability of Corporate Capital Mobilization................................. 19

2.4.1 Real financial situation of enterprise. .................................................................... 19

2.4.2 Influential factor. ................................................................................................... 19

2.5 The Basis for Determining Investment Requirement That Needs to Be Mobilized..... 20

2.5.1 Liquidity ratios....................................................................................................... 21

2.5.2 Activity ratios. ....................................................................................................... 21

2.5.3 Financial leverage ratios. ....................................................................................... 22

2.5.4 Profitability ratios. ................................................................................................. 22

Chapter 3 Research Methodology........................................................................................... 24

3.1 Research Method .......................................................................................................... 24

3.1.1 Descriptive statistics. ............................................................................................. 24

3.1.2 In-depth interview.................................................................................................. 25

3.1.3 Participants of in-depth interview.......................................................................... 25

3.1.4 Design the questions. ............................................................................................. 26

3.2 Reliability and Validity................................................................................................. 27

3.3 Data Collection ............................................................................................................. 28

3.3.1 Primary data........................................................................................................... 28

3.3.2 Secondary data....................................................................................................... 28

3.4 Data Analysis................................................................................................................ 29

Chapter 4 Research Results and Analysis............................................................................... 31

4.1 Status of Driving Test Centers and the Needs to Learn Driving .................................. 31

4.1.1 Status of the driving test centers. ........................................................................... 31

4.1.2 Demand of society to learn driving........................................................................ 32

4.1.3 Preliminary survey about contributed ability......................................................... 33

4.2 Regulations on Raising Capital..................................................................................... 33

4.3 Evaluating Selection of Feasible Plan .......................................................................... 35

4.4 Select the Most Feasible Plan ....................................................................................... 35

4.4.1 Estimates of revenue – expenditure of investment plan to supplement driving cars

by raising capital from staffs of center. .......................................................................... 36