Access to "easy-going" market: Precaution against risks

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Enterprises need to improve, enhancing marketing strategies, promoting brand products. Photo: Danh Lam.

Many risks

According to many enterprises, Africa has always been considered an "easy-going" market, although the value of purchased products is cheaper but the quality requirements are lower than those of traditional markets in Vietnam. However, this market imposes many hazards as well as risks, especially for first time trading

Sharing a story, a representative of an agricultural export-import company in Hanoi said that, along with China, enterprises choose African markets as an ideal destination, as these are potential markets, great demand but do not set strict requirements on product quality. But in these markets, the economy has not developed strongly, so the banking system is poor and not connected with international payment, especially with banks in Vietnam. Therefore, at the first transaction, when this company has transported goods to partners but the customers did not pay the rest of the contract even it was the deadline. The cause is learned that the bank in that country does not accept payment with banks in Vietnam.

In addition, he said, most businesses and partners in some African countries often choose direct payment method with cash, or only pay after receiving all the goods, so that you have to send people to place, directly dealing to prevent unnecessary commercial risks. This method causes the company to lose more cost, but in return will exploit more effectively in this potential market.

Outside of Africa, Vietnamese businesses are also targeting Middle East markets (United Arab Emirates, Quata, Saudi Arabia ...) or some South Asian countries such as India and Bangladesh. This is reflected in the output, the value of export increased steadily through each year ... However, representative of Ha Thai Tea Joint Stock Company said that, to make some new markets such as Bangladesh, Turkey, India ... to have cultures of enjoying tea in Vietnam and China their product must require their own production process and product form. Therefore, this company does not have enough costs to produce and transport so that they temporarily stopped trading.

Along with difficulties in production, payment, transactions, Vietnamese enterprises also facing the pressure of price. In this regard, Ms.Pham Vu Ha, general secretary of Vietnam Cassava Association, said that the production capacity of Vietnamese enterprises is still weak, so the international competitiveness is poor, many enterprises have to choose the easy-going market. However, the practice of trading between Vietnamese enterprises and their partners in the "easy-going" market is still very weak, creating a gap for customers to take advantage of the consequences of being forced to price.

Independent

Recently, Vietnam Association of Seafood Exporters and Producers (VASEP) issued a warning about seafood export to China. According to VASEP, China is Vietnam's main market for agriculture, forestry and fishery products, but over the past time, China has increased technical barriers to some agricultural and fishery products of Vietnam. Many Chinese traders ordered big size pangasius (more than 1 kg per head), which led to an increase in supply, but then suddenly decreased the purchase price, which negatively affected raw material prices. Or recently, India abruptly issued an order to stop imports of some agricultural products of Vietnam, although the order was later removed after a few days, but it has made Vietnamese companies worry more or less...

In fact, the production process of many Vietnamese enterprises in the commodity line is still small, not paying attention to quality but only attention to the movement and just want to work with easy-going customers. Therefore, many items are losing ground in high-value export markets, to accidentally or deliberately intensify in "easy-to-be" markets, as a result, will reduce prestige as well as the quality of export value of Vietnamese goods. Experts believe that enterprises operate in that way only take into account short-term "outputs", while long-term sources and prestige will be highly volatile and unstable.

Therefore, in addition to finding and understanding more information about the market, business partners, enterprises need to take measures to proactively improve quality, avoid depending on the "easy-going" market, aiming at markets that are" hard " but ensuring safety and increasing the value of export products.

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According to Tran Quoc Manh - Association of Fine Arts and Wood Processing of Ho Chi Minh City, enterprises need to enhance, improving marketing strategies, promoting brand products. At present, the cost of trade promotion of domestic enterprises is still low compared to other countries in the region, which makes the effectiveness of cooperation and production is not high.

Therefore, in the coming time, this work should be supported and promoted so that Vietnamese enterprises can approach the world market more closely and have the necessary response in any situation.