BS A1.1
BS A1.1
3
B. MAJOR FINDINGS.............................................................................................................................4
I. Introduction about FPT Retail..........................................................................................................4
1. FPT Shop’s introduction and its market......................................................................................4
2. FPT Shop’s statement....................................................................................................................4
II. The effect of macro environment on FRT’s business strategies....................................................5
1. PEST analysis and the influence on FPT Retail..........................................................................5
a. Political.......................................................................................................................................5
b. Economics..................................................................................................................................6
c. Social cultural.............................................................................................................................6
d. Technology.................................................................................................................................7
2. Apply Porter’s Five-Forces on FRT.............................................................................................7
a. Power of Supplier (High):.........................................................................................................7
b. Power of Customers (High):.....................................................................................................8
c. Threat of substitute products:...................................................................................................8
d. Industry competitors:................................................................................................................8
e. Potential of new entrants into the industry..............................................................................9
III. Assess an organization’s internal environment and capabilities.................................................9
1. Analyzing value chain of FPT Shop.............................................................................................9
a. Support activities.....................................................................................................................10
b. Main activities..........................................................................................................................11
2. The FPT Shop’s stakeholders’ analysis......................................................................................13
a. External stakeholders..............................................................................................................13
b. Internal stakeholders...............................................................................................................13
3. SWOT analysis depending on Macro.........................................................................................15
IV. Apply the outcomes of an analysis, using an appropriate strategic management tool,............16
1. Apply Ansoff matrix to FPT Shop’s product and market strategy..........................................16
2. Porter’s three generic competitive strategies.............................................................................17
3. SAFE criteria:..............................................................................................................................17
V. Develop a strategic management plan...........................................................................................18
1. Define and discuss the crucial factors........................................................................................18
2. Strategic management plan for FPT Shop.................................................................................19
A. INTRODUCTION
In this report, I will analyze FPT Shop from the perspective of business strategy
management, apply a series of appropriate models and concepts, as well as the analytical
tools/frameworks in the business strategy.
B. MAJOR FINDINGS
I. Introduction about FPT Retail
1. FPT Shop’s introduction and its market
Vietnam's FPT Digital Retail Joint Stock Company (hence referred to as "FPT Retail")
was founded in 2012 and is a subsidiary of FPT Corporation that focuses on the purchase,
sale, and maintenance of industrial machines and tools. the areas of medicine, teaching,
research, and manufacturing... In addition to its namesake FPT Shop, FPT Retail also
owns the F.Studio By FPT and the Long Chau pharmacy system. As the number two
retailer in the world of consumer electronics, FPT Shop takes great pride in this
accomplishment. To put it simply, this is a retail chain that focuses on selling mobile
digital devices such as smartphones, tablets, laptops, peripherals, and telecommunications
services.... According to ISO 9001:2000 standards, FPT Shop is the first retail system in
Vietnam to be accredited for quality management. FPT Shop's worldwide reach and
presence in the Vietnamese market are both on the rise, with 46 offices already
established in 22 countries and territories.
Mission: FPT Shop's long-term objective is to dominate the Vietnamese market for
digital telecom products via a strategically placed network of stores.
Goals: FPT Shop's primary objective is to grow steadily, earn a global reputation as a
premier provider of cutting-edge digital products to Vietnamese consumers, and invest in
the development and continuous improvement of a robust retail platform that can serve as
the launch pad for the company's expansion into new markets.
Core value:
Quality: Taking the initiative to establish trust and assume responsibility for
delivering high-quality products.
Reliability: both a trusted name in the eyes of its clientele and a dependable business
associate to the IT industry.
Friendly: FPT Shop's long-term vision is to portray itself as a business that values its
customers and is involved in the local community.
Care: With customer satisfaction as its first priority, FPT Shop is always working to
enhance the quality of its service by preparing its personnel to meet the needs of each
client.
The Government authorized the "National Digital Transformation Program to 2025, with
orientation to 2030" on June 3, 2020, with the goal of progressively developing open data
that is simple to access, implement, and accelerate processing. Organizing a Workforce,
promotes the use and storage of digital documents, reduce operating costs, gradually
build a modern working environment, saving time. restructuring, transforming
information technology infrastructure into a unified, stable, and flexible digital
infrastructure, prioritizing the application of cloud computing technology ... this is an
opportunity as well as a challenge for many businesses including FPT Shop.
Forecast: When the country implements an open economy, the market economy creates
many advantages for FPT Shop to exchange and trade with phone-producing countries to
promote cooperation relationships, development, and expansion of potential markets at
home and abroad.
b. Economics
Economic growth: The first nine months of 2022 saw the highest growth rate of any
year between 2011 and 2022, with GDP increasing by 13.67 percent from the same
period the previous year. Growth in Gross Domestic Product (GDP) in recent years has
been indicative of Vietnam's economy's strengthening, rising purchasing power, and
burgeoning business activity across the board.
Inflationary: In September 2022, core inflation rose by 0.47 percentage points month-
over-month and by 3.82% annually. Core inflation climbed by 1.88% on average in the
first nine months of 2022 compared to the same period in 2021, which was lower than the
total average CPI (up 2.73%). because of the rising cost of essentials like food, petrol,
and oil. However, due to the Government's and the Prime Minister's meticulous
supervision, as well as the cooperation across ministries, branches, and localities, the CPI
growth was progressively reined in month after month.
Forecast: In the coming years, the Vietnamese economy as well as the world's economy
will have many fluctuations, the inflation rate may increase. This will affect input costs
from product suppliers such as Apple and Samsung, as well as investment capital of FPT
Retail.
c. Social cultural
Society: The General Statistics Office projects that Vietnam's population will hit 99
million by the end of 2022 and grow by 784,706 to 99,329,145 by the beginning of 2023.
By 2022, 7% of Vietnam's population will be 65 and older, marking the beginning of the
country's "aging" phase. Aged persons will make up 7.7 percent of the population in
2020, or 7.4 million individuals. By 2050, this percentage is expected to rise to 20.4%,
with an estimated 22.3 million persons making up this segment of the population. The
aging of the population has a large impact on the economy because the elderly spends
less than the young, and the consumer market is also adversely affected, and FPT shop's
revenue is also reduced.
Forecast: There are many technology products are created to meet the necessary needs in
people's lives. Therefore, the consumption of technology gadgets in Vietnam may
increase sharply in the following years. To meet this demand, FRT must strive to provide
a variety of technology equipment in terms of brands and types.
d. Technology
In general, the popularity of using smart phones, and private laptops of Vietnamese
people has increased rapidly in recent years, especially youngsters. According to Mr.
Tran Khoa Van - Managing Director of GfK Vietnam, in 2021, the proportion of
smartphones with basic phones is also growing year by year. In 2020, the numbers are
71% and 29% respectively. By 2021, the proportions will be 80% and 20% (Khuong
Nha, 2022). These things have great influence on the selling system of FPT Shop. This is
because the company must ensure that technological devices are always provided enough
for customers. Therefore, FPT Retail applied mobile online ordering system, which can
decrease the number of employees at the counter, and avoid long queues, which make
customers uncomfortable. Moreover, this system also makes the retail system of the
company to become more advantages such as sales, customer consultation, and delivery.
Forecast: With the fast development of technology in Vietnam, there are some certain
barriers that require FPT Retail to have to update and enhance right away to maintain its
brand identity in Vietnamese market.
Foreign retail chains will have a hard time breaking into the Vietnamese market due to
the country's requirement that they control 50% of the retail sector in order to operate.
Second, retailers need multiple stores to have a commercial advantage. The first movers,
like FPT Shop, will have the upper hand and get all the prime real estate. In addition,
retailers' net profit margins are relatively thin; as a result, they need to have a firm grasp
of the retail sector and its clientele to run efficiently and avoid financial missteps.
a. Support activities.
Human Resource Management:
Recognizing that its employees are the key to the company's long-term success, FPT
Shop has made human resource management a top priority. The company has instituted
several programs and policies aimed at creating a stimulating and productive workplace
for its employees, as well as recruiting, training, and rewarding top talent. Developing a
staff of constantly learning and highly qualified, fair and transparent in assessing the
capacity of each employee regardless of gender, age and region differences, harmonious
and balanced appointment between leaders and managers at all levels, creating employee
cohesion through remuneration and welfare policies associated with core spiritual values.
core and company culture.
Technological development:
In order to meet the increasing needs of customers, FPT Shop has gradually improved its
information technology system, specifically the ERP financial and accounting
management system, the smartphone sales system, cameras to monitor each store, a
system to measure the number of customers visiting and shopping at the store, a CRM
system to manage customer information, a human resource management system to help
manage 5,000 salespeople, a sales system Online shopping with 2 desktop and mobile
versions, electronic delivery system with map navigation. Electronic invoice issuance and
administration technology allows FPT Shop issue up to 500 bills simultaneously, making
it the first firm to do so. Manage invoices by province, issue new invoices.
Purchase:
FPT Shop's association with suppliers such as Apple, Samsung, Oppo... these are genuine
manufacturers of digital products. This makes the company's products, when supplied to
the retail market, ensure the prestige and genuine products, creating the trust of customers
for FPT Shop's products.
To thrive in the market with many competitors as well as many suppliers, changes in
product prices, etc., FPT Shop must focus on investing and developing long-term
relationships. long-term, mutually beneficial cooperation with stable and reputable
suppliers in the market, applying appropriate pricing policy. From there, it is possible to
commit to buying in large and stable quantities, enabling manufacturers to optimize
production plans and save costs to lower product costs in line with customer needs row.
The infrastructure:
Currently, FPT operates 46 offices in 22 countries and territories outside of Vietnam, and
the company's ownership of telecommunications infrastructure in Vietnam's 63 provinces
and cities numbers 657.
FPT is constantly researching the market and stores. Specifically, the location of FPT
Shop is usually located at intersections and densely populated areas to attract customers
and easily coordinate products during delivery. About the space of the store. Coming to
FPT Shop, customers will be impressed with the two main colors at the store, red and
black. The aisles of FPT Shop are spacious and comfortable. The glass door has many
billboards hanging to attract customers' curiosity about the product. FPT Shop's trial
product display area is quite large with a variety of phone models. The areas of payment,
customer care, and technical support of FPT Shop are spacious, to minimize the long wait
of customers.
b. Main activities
Based on the Michael porter model, there are 4 main activities, but according to the
above analysis, FPT Shop is just an electronic retail system that does not directly produce
products, so the main activities of FPT Shop include: Including: Inbound Logistics,
Output Logistics, Sales, and Service Marketing.
Inbound logistics:
Since FPT Shop is a retail system of FPT Corporation, most of the stored products are
technological and electronic devices packed in quite heavy cartons. Iron shelves play an
important role in goods management, convenient in time management and saving
investment costs, and at the same time bring great efficiency to increase storage capacity
in warehouses for businesses. company.
Unlike conventional warehouses, FPT Shop's are highly automated. Because of the high
level of automation in an FPT Shop warehouse, the amount of code needed to run it is
substantial. Unlike Amazon, which has invested heavily in a state-of-the-art IT
infrastructure for its website as well as a comprehensive yard and warehouse system,
most online retailers focus solely on the former.
Output logistics:
The FPT Shop offers countrywide shipping. When FPTshop.com.vn receives an order
from a client and the customer confirms the purchase details over the phone,
FPTshop.com.vn will ship the product to the customer's specified delivery address.
Hold inventory in any of the 1,000+ FPT Shop locations, and customers may pick up
their orders at their convenience.
Home delivery appointments made with FPT Shop must be scheduled before 21:00 (for
phones and tablets) and 20:00 (for laptops).
For orders with a delivery radius more than 20 kilometers, the FPT Shop team will
provide comprehensive delivery method recommendations.
Please pay in full at the time of purchase for any home delivery orders totaling VND 50
million or more.
Products sold by FPT Shop are those with an unmistakable pedigree and high standard of
quality; these products can inspire consumer trust because of their provenance and
authenticity. It's also nice that products purchased from FPT Shop come with a warranty.
In order to better serve its clientele, FPT Shop has expanded its product offerings to
include smart watches, accessories for a wide variety of computers, phones, etc.
The product diversification makes FPT Shop becomes richer and more diverse with
consumers. FPT Shop has launched promotions, discounts when paying right away and
warranty up to 2 years. FPT Shop's service is also something to be proud of when it
brings the customer experience to the highest level. Not only satisfied with purchased
products, but also products and services are also noticed by FPT Shop. The 1-for-1
warranty, or after-sales services are rated by customers as one of the companies plus
points.
Customers: Customers have a profound influence on FPT Shop because they decide the
demand for the company's products and play an important role in developing and
improving the quality of services of the business, as well as expanding the source of the
company's products. row.
b. Internal stakeholders.
Employees: Employees have a significant influence on the company because they have
contributed to the outstanding success of FPT Shop over the past 10 years. In addition,
employees are also very interested because the organization always has many welfare and
remuneration regimes for employees to ensure the promotion of each individual's
capacity and maintain the relationship with the company.
Strength Weakness
Parent company - FPT has been a The field of online advertising has
distribution representative with many not had a breakthrough, information
major suppliers in the field of equipment related to FPT Shop products has not
and technology, so it is reputable to been focused on in the
establish a relationship to become a communication process.
distributor of these suppliers. New level. FPT Shop does not directly
Using FPT.AI Conversation to create a manufacture products, but imports
Virtual Assistant, to consult sales and products from suppliers, so it
automatically answer frequently asked depends on suppliers.
questions of customers on e-commerce The ability to compete in terms of
website https://fptshop.com.vn/ and freight rates lower than competitors.
Facebook Fanpage
Opportunities Threats
GDP growth is maintained at a high level, For businesses operating in the retail
helping to increase incomes and improve industry such as FPT Shop, high
consumer sentiment. This is one of the inflation will affect the business
main factors affecting the revenue of FPT activities of FPT Shop through an
Shop, the rising living standard of the increase in the price of purchased
people along with the expansion of the goods, the cost of freight from the
middle class is said to be the main reason center. distribution to stores, ...
why retail becomes a potential field. reducing the purchasing power of
Consumers increasingly have the habit of consumers.
researching, buying online is an Pressure in the retail industry comes
opportunity to attract customers to visit from domestic and foreign
the website fptshop.com.vn. enterprises.
IV. Apply the outcomes of an analysis and using an appropriate strategic
management tool.
1. Apply Ansoff matrix to FPT Shop’s product and market strategy.
In the past:
When it was first established, FPT Shop used a market penetration strategy. At that
time, FPT Shop was the parent company FPT - one of the famous corporations in the
field of information technology in Vietnam. Therefore, FPT Shop is quite convenient in
attracting the attention of domestic customers. The only problem that FPT Shop faced at
that time was the competition with other big competitors (Thegioididong,
CellphoneS, ...). Therefore, FPT Shop has applied the “Promotion” elements of the
marketing mix. Specifically, FPT Shop has organized a number of programs such as: Up
to 30% off all Laptop products, helping new students easily own their favorite laptop.
At the moment:
In the future:
FPT Shop will apply the market development strategy in the coming years. In addition
to expanding the retail market to Southeast Asian countries, FPT Shop also tries to take
advantage of the reputation of the parent company, FPT Group, to import new product
models such as computer components, PCs, etc. With this turning point, FPT Shop will
officially enter a new business segment of computer hardware devices instead of just a
retail chain of laptops and mobile phones. Entering new markets will help FPT Shop have
more opportunities to maintain high and stable profits in the future.
2. Porter’s three generic competitive strategies
Differentiation Strategy:
The company has launched two new key business strategies to increase revenue per store.
FPT Shop will focus on improving customer care services to increase the rate of service
usage at the store. Notably, although the rate of going to the store remained at 67%,
according to FPT Shop's statistics from 2017 until now, FPT Shop has significantly
improved the ratio of customers buying products/customers to the store from 24 back
here now. Up to 44%. That means for every 100 customers visiting, there will be 44
people generating revenue for FPT Shop. In addition, FPT Shop is researching and
perfecting the application of QR barcodes to replace the manual connection between the
shipper/recipient in the process of tracking and transporting goods.
3. SAFE criteria:
Suitability At the present time, FPT Shop is one of the largest retail
technology stores in Vietnam, but now with the technology in
the world changing day by day. Therefore, to always stand
firm or create a breakthrough, FPT Shop needs to constantly
innovate to match the general development trend. Therefore,
FPT Shop maintain as one of the largest technology retailers
in Vietnam, as well as improve business.
Feasibility Compared with other strategic options, the digital
transformation strategy is the simplest and easiest choice for
FPT Shop in terms of human resources, finance and
technology. With the fulcrum of parent company FPT Group -
one of the largest information technology corporations in
Vietnam, FPT Shop has a strong and qualified staff with good
skills. Besides, the financial resources of parent company FPT
Group are quite abundant to support this strategy.
Acceptability By implementing a digital transformation strategy, the
company will provide a whole new shopping experience for
customers on mobile apps. In addition, it is easy for
stakeholders to decide to adopt this strategy because they are
aware of the success of the business. But in the beginning,
some large expansion costs can affect profitability and
productivity. overall capacity.
Evaluation According to the assessments above, given the current market
and trends, the digital transformation strategy is the most
suitable strategy for FPT Shop. With the strong foundation of
the parent company, it is quite easy to create a mobile sales
app of FPT Shop by combining OneApp with Omnichannel
retail support software.