Challenge from Competition from Rivals

Source: Pano feed

“The rise of competitors in the same industry is the most ominous factor for growth.” This perspective is given by more than 60 percent of businesses surveyed in the FAST 500 report of the top 500 fastest growing companies in Vietnam in 2015, which was conducted by Vietnam Report and VietNamNet.Strong business expansion in 2015

Most of the surveyed firms said the number of orders, turnover, machinery utility rates, after-tax profit and money flow in 2014 were better than previous years, with increases of 82.2 percent; 79.5 percent; 78.9 percent; 78.7 percent and 77.6 percent, respectively. These are positive signs showing a strong movement and brighter future for businesses.

With leading indicators in many aspects such as number of orders and sales due to implementation of effective marketing plans to expand business in the past 4 years, more than half of the businesses have successfully expanded existing markets and achieved significant growth in the domestic and regional markets. Such achievements are two most important factors contributing to business expansion in the period 2011 and 2014, especially in the context of global economic integration.

According to the report, there will be 75.7 percent of surveyed firms who will expand their business to increase sales and build up their brandnames in the market, 19.2 percent who will not change their action plans and only 5.1 percent will downsize their businesses because there are some concerns about the growth opportunities in 2015.

This is a good sign for businesses that have escaped from the recession and are ready for a new growth.

Low interest rates should be maintained

New prospectives motivate businesses to be more confident about growth strategy in the medium and long term. According to the survey of the Vietnam Report, the improvement of productivity and quality of the management team as well as the development of product lines and services are considered three new growth strategies that are focused in 4 years (2011-2014), as well as main directions in the next 4 years (2015-2018) with a growth of 51.3 percent, 48.7 percent and 38.5 percent, respectively. M& A activity will be very “lively” in recent years with the prospective of bringing new vitality to Vietnamese enterprises that tend to “cool down” because 76.9 percent of businesses do not choose this as their key strategy in the last 4 years and in the next 4 years.

Commenting on the challenges ahead, competition was expected to increase with 60.3 percent considering the rise of their rivals in the same industry the biggest challenge. Hence, the need for information transparency is now crucial because only with the accurate information and new strategy, the planners could come up with medium and long-term strategies consistent with corporate capacity as well as general market trends to minimise the deviation in the forecast.

Regarding the expectations of businesses, 78.2 percent of businesses said that “maintaining low interest rates” should be the preferred solution in the next 4 years, creating more favourable lending conditions for enterprises to save costs for the implementation of growth plans to expand markets and increase revenues and profits. This is the problem that draws great attention from the State Bank of Vietnam. In addition, the government can also support businesses by reducing corporate income tax (76.9 percent), investing more in infrastructure (60.3 percent), and offering more supports for training and development of human resources (46.2 percent).

2015 is the 5th year of the FAST500 report. The report has been published since 2011 and marked a milestone of Vietnamese businesses. Listed in the FAST500 report, businesses are highlighted by their dynamism, creativity and efforts in the previous economic situation that is still volatile; such businesses are deserved to be “rising stars” of the economy. Top 10 fastest growing companies Samsung Electronics Vietnam Co., Ltd; Vinacomin Power Corporation – One Member Limited Liability Company; Vung Ang Petroleum JSC; Long Son Co., Ltd

European Plastic JSC; Thanh Long JSC; Eco Phamar JSC; Dai Huu JSC; Sigma Engineering JSC; Vina Food Breeding JSC.

Top 10 small and medium-sized enterprises (SMEs) with the fastest growth rates Son Trang Construction JSC; Kien Khe Quarry Material Co., Ltd; Noi Thuong Bac Transportation Car Co., Ltd; Tam Viet Production and Trading JSC; Thien An Phat Textile Garment Investment JSC; Biotan Mineral JSC; Nem Trading JSC Lilama 69-1 Pha Lai JSC; New CC Construction Consultants Co.,Ltd; Viet Phuong Ha Nam Co., Ltd.Anh Mai

Đăng ký: VietNam News