BE A2

Introduction In 1995, the group produced consumer goods, Unilever started investing in Vietnam . To date the Group has invested a total of $ 100 million . The member companies of the Unilever Vietnam including Vietnam Lever , a joint venture with Hanoi Soap Company and Chemical Corporation Vietnam ; Company ELIDA P / S toothpaste production , joint venture with cosmetic company . Unilever has 5 factories in Hanoi City . HCM . Share Capital (million USD) Capital contribution of Unilever Location Scope of activities Lever Vietnam joint venture company (1995) (*) 56.3 67% Hanoi/ HCMC Family care products, personal care and hygiene shorts detergents ELIDA P/S joint venture company (1996) 17.5 55% HCMC Family care products Unilever Best Foods VN(1996) 37.1 100% HCMC Cream, tea, food With the familiar brands like OMO , VISO , Lux , Lifebuoy , Lipton tea ... Unilever is rated as one of the consumer goods companies the most successful operations in the Vietnam market . " Once the decision was rooted " in Vietnam , we will determine in the long run . When speed is important in business , the right actions is crucial even more. This means that we spend enough time on understanding the business environment and the characteristics of consumers Vietnam , "said Michelle Dallemagne said . Unilever has invested money all the time to create trust with Government and partners in Vietnam. Unilever calls it ambitious but persevere . Unilever's major investments in Vietnam ( over 100 million) also made ​​the company's expectations : not for short-term gains , the first long-term investment in Vietnam . The long-term investment decisions in Vietnam has helped Unilever have time to learn specific markets , consumer psychology of Vietnam as well as the traditional culture . Products toothpaste P / S salt is the perfect combination between traditional culture and modern . Unilever has helped consumers conserve brushing habits you want , bring a new dental care . Or with shampoo Sunsulk locust , the shampoo not lost familiar taste of the past . These are just two products are very popular in the market Sunsilk locust Vietnam accounts for 80 % of Sunsilk , P / S salt accounted for 40 % of the type P / S. Delving deep in the locality , the more we see highlights of Unilver existence . Perhaps in any locality , including mountains , OMO , VISO , Lux ... are looking to consumers . Although incomes in rural areas , where 80 % of the population , much lower than in urban areas but Unilver understand that 60 million people have needs such as in the taste . The challenge here is the finished product pricing and variety they are coming to them . The products of Unilever Vietnam suitable for a person difficult to explain . Many people (especially in rural areas ) were used instead of OMO washing powder , washing powder for granted as the OMO . In this report, I will talk about: How market structures in the above case determine the pricing and output decisions of businesses. The way in which market forces shape Unilever responses. How the business and culture environment shape the behaviour of Unilever. The significance of international trade to Unilever in UK. The impact of global factors on Unilever in UK. The impact of policies of the European Union on Unilever and its competitors in UK.  3.1 Explain how market structures determine the pricing and output decisions of businesses have on motivation in organizations in periods of change and culture: Today, there are plenty of market structure, the structure also helps the company the right in general and particularly Unilever determined their market and their customers. There are six categories of market structure: Perfect competition, the monopolistic competition, the monopoly and the oligopoly. The following are concepts of each market structure: Perfect competition: describes a market structure where competition is at its greatest possible level. Ideally, perfect competition is a hypothetical situation which cannot possibly exist in a market. However, perfect competition is used as a base to compare with other forms of market structure. Monopolistic competition: Monopolistic competition differs from perfect competition in that production does not take place at the lowest possible cost. Because of this, firms are left with excess production capacity. This market concept was developed by Chamberlin (USA) and Robinson (Great Britain). The monopoly: A market structure characterized by a single seller, selling a unique product in the market. In a monopoly market, the seller faces no competition, as he is the sole seller of goods with no close substitute. In a monopoly market, factors like government license, ownership of resources, copyright and patent and high starting cost make an entity a single seller of goods. All these factors restrict the entry of other sellers in the market. Monopolies also possess some information that is not known to other sellers.Characteristics associated with a monopoly market make the single seller the market controller as well as the price maker. He enjoys the power of setting the price for his goods. Unilever is a big business and is well known not only in Vietnam but also in the world. Unilever products are sold in over 190 countries and in late 2012, Unilever had nearly 200,000 staff. We can see Unilever is in monopolistic competition and market affected by this. To survive in complete monopoly, Unilever has adopted the marketing mix in Vietnam market. Place: In 1995, Unilever in Vietnam and decided to create a system of nationwide distribution live poetry (more than 100,000 locations). The Cabinet granted retail products and maximum use of the space in their store and catch the eye of your product. In addition, the company also helped the studios to distribute loans to buy vehicles, training and sales organizations. Product: The company has applied the international standards for the product but adapted to the needs of the people of Vietnam. Unilever has acquired from its counterparts the reputed brands from many years in Viet Nam as detergent Viso, and roast P/s. then, the company has repeatedly advanced formulation packaging and marketing to increase the consumption of this label. Besides, the company also deep understanding of people's needs for extra product to the consumer. For example, Sunsilk shampoo that contains them from locust tree essences-a type of shampoo. This label also was very successful very big 80% of sales of Sunsilk shampoo brands. Promotion: As well as the company's fast-growing consumer, Unilever Viet Nam has two main array in strategies to promote their image as "Above-the-Line" (direct marketing) and "Below-the-Line" (indirect marketing) Price: Although Unilever in UK is a big company and have big market share, Unilever cannot decide the price of product because Unilever is influenced by the UK Government such law, tax… Therefore, Unilever’ product (MAGNUM) do not set price because their price can affect other competitor. 3.2/ Illustrate the way in which market forces shape Unilever responses using a range of examples. Market forces are the relationship between supply and demand. It mean when demand of market go up but the supply decrease so the price of product or services will increase. It will encourage the companies to produce and sale their products. An organization’s responses to market forces is a factor, which help the company can make profits and reputation. (equalityhumanrights, nodate) In addition to the impact of the market as customer demand, consumer purchasing power, price, product quality. Unilever also affect by five factors: the threat of new entrants to the industry, the threat of substitute product or services, the bargaining power of customer, the bargaining power of suppliers and rivalry. (Source:http://hbr.org/2008/01/the-five-competitive-forces-that-shape-strategy/ar/1) The threat of new entrants to the industry: Unilever is company which produce the customer goods, so they always have many old and new competitor. In the world market, nearby the competitor in the long time, Unilever also have to face a lot of new competitors from many places in the word. Such as Ariel washing powder from, Twin Lotus Company Twin Lotus-Thailand; Aquafresh, Sensodyne of companies GlaxoSmithKline (GSK). Therefore, Unilever have to response. And open the area which is a way to help Unilever can solve this. Besides, Unilever established a long times, and came to Vietnam in 1995. It help Unilever build a barriers to block the new entrants to come to Vietnam market. The threat of substitute products or services: Unilever company product is the product of the brand in the market for their prices are usually higher than the same products, so lower income people, they will look to the products with the same function but at lower prices. Unilever has to be very adoptive and closer to its customers so as to get what exactly its customers want. The Unilever Sustainable Living Plan sets clear long-term commitments for health and well-being, environmental impact and enhancing livelihoods. These are underpinned by specific targets in areas such as sustainable sourcing, water availability and usage, waste and greenhouse gases. The bargaining power of supplies: Our business depends on securing high quality materials, efficient manufacturing and the timely distribution of products to our customers. Unilever have contingency plans designed to enable us to secure alternative key material supplies at short notice, to transfer or share production between manufacturing sites and to use substitute materials in our product formulations and recipes The bargaining power of customers: The profit of Unilever depend on the price of their product, but the price of their product take part at the expense of the customer. Therefore, having the maximum profit, but don't lose customers. Unilever have a lot of plans to meet the customers’ demands such as improve product quality, product diversification, building customer care system. Unilever's profits depend heavily on selling price and part sale price depending on the customers who make false. Noticed this Unilever have developed good customer care systems, and make customers always feel interested and satisfied (Unilever,2014). For example, the program P/S protection Vietnamese smile in collaboration with HCMC-facial hospital and Department of maxillo-facial-HCMC University of medicine organized the consultation activities and advice free of dental diseases for students in the elementary school in the city (Unilever, 2014) The rivalry amongst current competition in the industry: Competitors is indispensable in any industry include healthy and unhealthy competitor. Unilever have face stiff competition from rivals such as P&G, .It make market share of Unilever in Vietnam go down. Besides, Unilever also face many competitor to make imitation products of Unilever. It not only make Unilever lose profit, but also Unilever lose image in customer minds. Therefore, Unilever always improve their product quality with suitable price and advocacy for clients to help them can avoid the clone’s product of Unilever. . 3.3/ The business and culture environments shape the behavior of Unilever UK. The difference in the environment and business environment for companies affected especially Unilever. We can connect the two environments to discuss them. The difference in the environment and business environment are divided by two categories, such as micro and macro environment. We can use PEST (political, economic, social and technological) analysis as a tool to evaluate how the business environment and culture shape the behavior of Unilever. Policy factor: The human resource is important role in Unilever, so Unilever always develop them to help Unilever develop in the long-term. Unilever has built team of professional labor by created many staff training program. Besides, Unilever focus on the rights of employees such as salary, welfare, labor insurance… to support them in work or their life. Unilever also create many opportunities for Unilever’ staff to improve their skill by aboard course. Therefore, Unilever has built a good corporate cultures environment and had the strong team of quantified staff and have the responsibility for work of Unilever. This policy also help Unilever UK attract new manpower. Besides, Unilever focus on finding new human resource. Economic factors: This factor have the strong impact to each companies, so the companies have to know detail and clearly about monetary policy, fiscal policy and inflation UK is a developed country with high GDP. “The UK is the 6th largest economy in the world according to GDP (current prices, US dollars) and the 8th largest in the world according to GDP (PPP). In 2012, the UK’s GDP (current prices) was $2.44 trillion and its GDP (PPP) was $2.336 trillion.” (Team, 2013). Social/ Culture factors: Each country will have the different culture and social factors characteristic. It affect to business activities of the companies special Unilever and scales and structure of the market. Besides, social and culture also impact on perspective, behavior, psychology, shopping habits of customers. Technological: All most the product of each companies are influenced by with the scientific and technical achievements and technology. Nowadays, all the country focus on industrialization and modernization policy. Besides, if any company have new technology and apply them in producing, they can have strong development and exist. The objective Unilever is competing and defends Unilever in the market. Therefore, Unilever also focus on developing and creating the technology. Unilever constantly invest and develop scientific and technical with high scale and quality. Unilever UK and particular multi-national corporations Unilever created a lot of products, which had high quality and had the brand of global fame. For example: Scientific Research Centre of Unilever try to find new technology to suitable with the consumer worldwide demand. (Unilever, no date) This plan help Unilever UK have many success strategy to supply Unilever’ product and make benefit for Unilever and partner. 4.1 The significance of international trade to Unilever in UK. International trade is the exchange of goods and services between countries (BPP learning media, 2010). This business create a significance opportunity for the manufacturers and distributors attempt to gain from a wider market rather than looking at their own borders. The trade benefits of international trade are often do quite clear: + Exploit a huge market, consumers with high income, high - purchasing power of Unilever products are consumer products and cater to human health should be most concerned consumers Centre. + Enterprises to exploit comparative advantage. For example, in Viet Nam, there are favorable conditions for the production of agricultural commodities such as Viet Nam concentrate production of agricultural products. The European countries have advantages for the manufacture of industrial products (pharmaceuticals, machinery ...), the only European countries to focus on industrial production. To take advantage of this comparison, the Viet Nam and the European countries should have mutual exchange trading. In the other hand, VN to export agricultural commodities and importing manufactured goods and vice versa. + When organizations involved in world trade enterprises to easily import of machinery and equipment for parts for the manufacturing process. Because the barrier would be removed, or will be reduced. + Make use of foreign capital through investment cooperation. + Using the high labor situation. As in the European Union, the employees can work in the country in the European Community (Europ Commission, 2014). However, economic integration also brings certain disadvantages: +It means company must rival foreign companies. This leads to unemployment for the country. Because the country has comparative advantages of their products will be cheaper. For instance, Unilever's main international competitors include Nestlé and Procter & Gamble. Company also face competition in UK markets or product ranges from companies such as ConAgra, DANONE, General Mills, Henkel, Kraft Foods, Mars, Inc., PepsiCo, Reckitt Benckiser, Sara Lee and S. C. Johnson & Son (Mizu, 2014). + While thriving economy will result in excessive resource exploitation caused environmental pollution ecological imbalance. Markets in Europe, consumers are demanding that companies do business is to spend a lot of costs to improve product quality. 4.2/ The impact of global factors on Unilever in UK. Unilever is one of top Fasting Moving Customers Goods in the world. They operate with many countries. Besides, nowadays, the global have tendency Globalization and Unilever also effect of global. Therefore, PEST is the important tool help Unilever UK analysis the market and have the right decision when Unilever UK launching new products. (Source: https://creately.com/blog/diagrams/swot-analysis-vs-pest-analysis/ ) Political factors:   Political factors influence Unilever UK in many ways. Political factors can create advantages and opportunities for Unilever UK. Company is operating in the European Union have to adopt directives and regulations created by the EU. The political arena has a huge influence upon the regulation of businesses, and the spending power of consumers and other businesses. Unilever United Kingdom has enjoyed considerable stability compared to other regional outlets. The politics in the kingdom are mature and never disrupts the economic activities. The UK government support the fair trading commitment for both the local consumers and foreign producers. According to Transparency International UK, The governance corruption is not endemic in the UK, this is the opposite of other regions where political class determines the success of a company. The chairwoman of the Public Accounts Committee (PAC) has claimed that “New tax laws are too heavily influenced by major corporations” (Abrams, 2014). Taxation highly influences the product cost and the net profit of a company. Economic factor: This factor effect all company in host country. It decides the company can continue operating and develop. There are some economic factor such as inflation and interest rates, GDP (Gross domestic product) of a country, Unemployment and human resource. However, UK is industry country, which have the economy developed a long times and have GDP always increase. Social factors: The UK is a civilized society. The population in the UK is relatively big (63.23 million, 2012) and people here have relatively high standards of living. Therefore, demand for consumer goods is also very large. Therefore, Unilever also has a significant market share in Europe. The change of consumption behavior of consumers is totally out of control of the Unilever. So, the company has to generate products with respect to the customer needs. For example, most consumers like using greener products. "A strong environmental reputation is really important to today’s consumers," says Shelton, CEO of Shelton Group. (Sendrow, 2013) Technological factors: This is the strong factor affect to price of product. The technological factors are showed by some manifest such as new production methods, new techniques, new materials, production equipment, inventions … When the company improve technology, they will have a lot of benefit. For example: the company can easy to create new product or service with the high quality, the company can reduce the price and have advantage with other competitor. UK is a developed country, so UK have the industry development. It make Unilever UK be easy to development new product because the Unilever product requite the high technology. Besides, the high technology also help Unilever can reduce the cost to save environment. Legal: UK legal system for business activities of enterprises as well as for domestic commodities trading and commodity import and export incentives and support for business can be good business activity but it can also stringent regulations for businesses as well as business products. In general, the United Kingdom does not have much trade Barriers. Britain is a valued member of the EU. Located in the EU should British trade barriers mainly applied in accordance with the laws and directives of the EU. Integration factor: UK is a country, which took part in all most the global organization such as EU, WTO, and FTA …. It is the opportunity for the business in UK including Unilever to approach with the global market and advantage of the comparative advantage of each country in the form of trade or exchange. 4.3 Evaluate the impact of policies of the European Union on Unilever and its competitors in UK. The European Union is an economic and political union that connects all country in European Community together. There are now 28 member states that are located primary in Europe. This is the basic organization uniting several policy perspective, therefore, the European Union has formulated general policy for the whole block: the European common currency policy, fiscal policy, labour policy employment. The Monetary policy: This is a policy has relationship to rate of money resource provided for member states in European Union such as rate of capital mobilization, mandatory capital ratio have defined for EU in each period. The Fiscal policy: is a policy has relationship to tax, government spending, debt and repayment of each country in EU. In the recent year, the fiscal policy of EU are tightened because the country of EU are being inflicted by the global financial crisis especial public debt. Therefore, the companies in UK especial Unilever have to impact from this fiscal policy of EU. The Currency policy: Nowadays, all most countries in EU use the common currency without UK (Pound). This currency make Unilever and competitor have benefit when they exchange to other country in EU because they will don’t pay foreign currency conversion fees when they import and export with the countries in EU. The Labor and Employment policy: EU is a big organization with 28 countries, so the labor in EU can find the job in any countries in EU. It happen employment disputes between the countries in EU, because the countries in EU have uneven development. It make the Unilever have many chooses labor and find potential market. However, this policy also give Unilever and competitor many disadvantages such as political, social…  Conclusion The above analysis has shown us that the business environment of Unilever in the UK, so that Unilever can attract customers and become the best brand in the UK. Unilever has captured the feelings of the vast majority of consumers in Vietnam for nearly a decade.  References Abrams, F., 2014. [Online] Available at: http://www.bbc.co.uk/news/business-21229862 BPP Learning Media, 2010. Business Environment. Second ed. London: BPP House. https://creately.com/blog/diagrams/swot-analysis-vs-pest-analysis http://www.investopedia.com/terms/m/monopolisticmarket.asp http://economictimes.indiatimes.com/ http://hbr.org/2008/01/the-five-competitive-forces-that-shape-strategy/ar/1 Unilever, 2012. Unilever Annual Report and Accounts 2011. 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