MARKETING GUIDELINES FOR VIETNAM FOOTWEAR PRODUCERS

z VIET TRADE- LEFASOVIETNAM THE ABC’S OF FOOTWEAR MARKETING MARKETING GUIDELINES FOR VIETNAM FOOTWEAR PRODUCERS (Making the Transition from Shoe Processing to Full Production) Produced by: LEFASO VIETNAM Assistance Provided by: INTERNATIONAL TRADE CENTRE UNCTAD / WTO 37 INTRODUCTION In developing this product, a great deal of material was reviewed including international marketing textbooks, export marketing guidelines generated by various international experts, and material contained within the websites of many companies and international organizations. While this information was helpful and generated ideas, it was not of the practical, step by step, nature needed by a company trying to determine if export marketing is a viable option. Virtually all the information contained in previously mentioned export marketing publications deals with marketing branded products rather than the private label products that Vietnamese companies are called upon to produce by international buyers. This guidebook’s primary focus is on marketing private label or customer branded footwear. This does not mean that Vietnamese companies should not make a greater effort to produce products for the domestic market nor does it mean companies should not consider developing their own brand names. Both of these are viable options and could be a more profitable alternative for many companies now attempting to export. This guidebook uses the methodology of analyzing individual companies from the viewpoint of an international buyer, who has a choice of thousands of factories worldwide to produce any individual product. The questions asked are the ones the buyer would ask and the infrastructure and material referenced are what would be expected from companies with which he plans to develop a relationship. Section A is perhaps the most important part of the guidebook. It contains a quick start analysis with numerous questions a company should answer to determine where it should focus the efforts of its business. There is no right or wrong answer to these questions but a company with many negative answers, should consider the steps necessary to rectify these before attempting to expand its marketing effort. The questions asked in this section are critical for companies to discuss internally as they develop short and long term strategy. These questions could easily become the foundation for a company’s annual strategic planning session. Section B discusses the steps in process, knowledge, and human resources that are necessary to successfully move from producing shoes under export processing contracts to full product production and marketing. Also discussed are the same considerations for a company who wishes to focus on the Vietnamese market. 38 Section C contains the basic marketing guidelines and suggestions for those companies who wish to pursue the export market. The Guidebook Appendix includes information sources and important examples of Vietnamese companies who have become success stories in developing and exporting footwear to international markets. This guide is by no means a full fledged marketing textbook but is designed as a product to help Vietnamese companies approach the international footwear market in an effective and professional manner. A. Quick Start Company Analysis Domestic Are you currently producing footwear for the Vietnamese domestic market? Do you have your own retail outlets? Do you have your own sales organization or a network of wholesalers covering the entire country or regions of the country? Do you produce goods under a brand name? Is this brand name recognized and legally registered? If 10 consumers were asked if they were aware of your brand name would at least 5 likely say yes? Do you participate in domestic bids and tenders from government and private companies and are you aware of most of these opportunities? Do you have a process for determining the exact cost of shoe’s you produce? If you produce products under a brand name can you explain what the brand name stands for and do you try to develop products around that theme? If you produce products under a brand name do you know how much of your business the top 10% of the shoe styles represent? When developing new styles, do you first meet with your dealers or focus groups of consumers to get their reactions? Do you understand how to identify the footwear you produce in categories other than men’s, women’s, children’s? Do you understand the meaning of niche markets? Do you compete in at least 3 niche markets and how do you make your customers aware of this? Is someone in your company responsible for meeting and dealing with your customers 100% of his/her time and is that person willing and able to give you bad news as well as good news concerning customers? 39 Is someone in your company responsible for understanding and developing new products and technology? Do you attend at least one trade fair a year with the focus being on seeing new products, technology, and materials? Have you met the managers of the large foreign production companies and offered your services for subcontracting? Have you ever tried to sell cut and fit uppers? Do you attend at least one trade fair a year with the focus being on sales? Do you read and apply to your business at least one international publication per month dealing with footwear/clothing fashion? Are you using the same production processes to produce over 75% of your shoes that you used 5 years ago? Do you have access to the internet and use it for business research? Do you know your leading suppliers and customers e mail address? If a customer calls your company or sends you an e mail, do you have a system in place so that the call or e mail is always promptly answered? Have you ever developed a fashion show combining your footwear and clothing / accessories for your wholesale or retail customers? Are you able to identify your expenditures on sales, advertising, and R&D on a yearly basis and compare them to your sales growth? Are you a member of LEFASO and /or a local footwear association and are you aware of the benefits of membership? Export Are you currently producing footwear for the export market? Are you now or have you previously produced footwear under an export processing contract? Are you currently engaged in a joint venture agreement? If not have you tried to locate companies who might be interested in forming joint ventures? Have you developed a business card and basic written profile of your company in Vietnamese and English which provides information on your company (production, years in business, employees, etc.) to give to potential customers? Have you ever attempted to export cut and fit uppers? Do you have a specific plan to use the exhibitor guides of foreign trade shows for a marketing prospect list? Have you attempted this? Are you aware of every foreign trading company that has an office in Vietnam and are they aware of your company and its capabilities? 40 Do you understand the various methods of pricing your shoes (fob, c&f, cif, etc.) and can you quickly produce quotes using these methods? Have you made major upgrades to the machinery and processes in your factory over the past 5 years? Are your lasts and molds in European or American sizes? Do you understand the various international foot sizes? Do you frequently visit the main country you export production to? Are you aware of the foreign and domestic producers of raw materials and components located in Vietnam and have you approached them to see if their products are a good option for you? Do you have a person on your staff that devotes 100% of their time to dealing with customers? Does that person speak English and have e mail capability? Do you have a formal product costing system that lets you identify material and labor cost for each product you manufacture? If you purchase your raw materials have you developed at least 2 sources for every product and do you receive competing quotes? Do you have a person on your staff whose responsibility it is to use the internet for sales and material sourcing leads? Do you have someone your staff with the ability to quickly and accurately duplicate a sample from either a picture or an actual sample? Do you have an employee or an agent in a center of footwear materials (Taiwan / Hong Kong) who can supply you with the correct materials to produce a sample for a customer quickly? Do you have an internet website and have you researched and listed your company with every internet search engine and internet footwear industry site? Are you able to receive orders and bill customers using EDI? Do you have the capability of receiving customer patterns electronically? Have you developed in your main office, an area that displays awards, citations, and certifications that your company has received and would want customers to know about? Do you attempt to sell your products to markets closest to Vietnam rather than those the furthest away? Have you developed a list of your top 5 target markets? Have you tried to locate sales agents in these countries? Do you exhibit at the HCMC International Footwear Exhibition? Are you a member of LEFASO and aware of the services it offers to help you in exporting? B. Moving Beyond Export Processing Contracts 41 ... - tailieumienphi.vn