Tiểu luận môn Quản lí Logistics đề tài "Research the supply chain of Sai Gon Beer Corporation"

Tiểu luận môn Quản lí Logistics đề tài "Research the supply chain of Sai Gon Beer Corporation" của Đại học Bách khoa Thành phố Hồ Chí Minh với những kiến thức và thông tin bổ ích giúp sinh viên tham khảo, ôn luyện và phục vụ nhu cầu học tập của mình cụ thể là có định hướng ôn tập, nắm vững kiến thức môn học và làm bài tốt trong những bài kiểm tra, bài tiểu luận, bài tập kết thúc học phần, từ đó học tập tốt và có kết quả cao cũng như có thể vận dụng tốt những kiến thức mình đã học vào thực tiễn cuộc sống. Mời bạn đọc đón xem!

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ABSTRACT 
During the research and study process to complete our group assignment report, we 
received a lot of guidance from our teacher as well as help from our classmates to ensure the best 
completion of this report. 
We would like to express special thanks to Assoc.Prof Ph.D Lê Ngọc Quỳnh Lam for her 
detailed guidance and explanations regarding the knowledge of Management Business Logistics. 
Thanks to her instructions, our group was able to better understand the project topic and 
complete this assignment on time. 
Although we have tried our best to complete this report, there are still some shortcomings 
in terms of assuming data due to our limited practical experience. We sincerely hope for 
understanding and constructive feedback from our teacher and peers so that we can improve the 
report and gain experience for future assignments. We would like to express our sincere 
gratitude. 
 
TABLE OF CONTENTS 
CHAPTER 1: OVERVIEW OF THE SAIGON BEER – ALCOHOL – BEVERAGE 
CORPORATION – SABECO ..................................................................................................3 
1.1 General Information .........................................................................................................4 
1.2 Outstanding Achievements ...............................................................................................5 
1.3 Vision – Mission .................................................................................................................6 
1.4 Oriented Development .......................................................................................................7 
CHAPTER 2: THE SUPPLY CHAIN OF SAIGON BEER CORPORATION IN ......9 
VIETNAM ....................................................................................................................................9 
2.1 Introduction about the supply chain ..............................................................................9 
2.1.1 Definition .........................................................................................................................9 
2.1.2 Supply chain components ................................................................................................9 
2.1.3 Supply chain management .............................................................................................10 
2.2 Demand management and planning ............................................................................11 
2.3 Procurement of the supply chain ..................................................................................12 
2.3.1 Main ingredient .............................................................................................................12 
2.3.2 Production process ........................................................................................................13 

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3.3 Quality control ..............................................................................................................15 
4 Managing inventory flow ...............................................................................................16 
4.1 Goods characteristics ....................................................................................................16 
4.2 Warehouse .....................................................................................................................17 
4.3 Types of inventory .........................................................................................................18 
4.4 Inventory management ..................................................................................................20 
4.5 Good characteristics .....................................................................................................22 
4.6 Warehouse of SABECO .................................................................................................22 
5 Transportation system .....................................................................................................23 
5.1 Overview of Saigon Beer Transportation and Logistics Joint Stock Company  ...........23 
(Sabetranjsc) ..........................................................................................................................23 
5.2 Transportation system roles ..........................................................................................24 
5.3 Modes of transport ........................................................................................................25 
5.4 Advantages and disadvantages for the Saigon Beer transportation system .................26 
6 Distribution channel .......................................................................................................27 
6.1 Distribution channel ......................................................................................................27 
6.2 Members in the Distribution Channel of Saigon Beer ..................................................29 
6.3. Distribution Channel Structure ....................................................................................30 
6.4 Distribution Channel Design Process ...........................................................................31 
6.5 Distribution Channel Management ...............................................................................33 
6.6 Distribution Channel flows ...........................................................................................33 
6.7 Saigon Beer distribution channel system ......................................................................35 
CHAPTER 3: PROBLEM AND SOLUTION ....................................................................37 
1. Problems in Distribution Network ...............................................................................37 
1.1. Imbalanced Distribution Market ..................................................................................37 
1.2. Inaccurate Order Fulfillment .......................................................................................38 
1.3. Exchange and Return ...................................................................................................39 
2. Problems in Inventory Management ...........................................................................40 
2.1. Inefficient product storage managing ..........................................................................40 
2.2. Excessive or Insufficient Inventory ..............................................................................41 
3. Problems in Transportation Process ...........................................................................43 
3.1. Compliance and Regulatory Issues ..............................................................................43 

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3.3.2. Insufficient Transportation Infrastructure System .......................................................45

3.3.3. Abnormal Weather Conditions .....................................................................................47

3.3.4. Inefficient Transportation Process ...............................................................................49

3.3.5. Loss of Goods during Transportation ..........................................................................50

3.3.6. Fluctuate Transportation Costs ...................................................................................52

CHAPTER 4: CONCLUSION ...............................................................................................54

REFERENCES ......................................................................................................................55

LIST OF TABLES

Table 2. 1: Beer parameters for storage..............................................................................22

Table 2. 2: Size of the unit of goods 28

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LIST OF FIGURES

Figure 1. 1: Products of Saigon Beer Corporation – SABECO..............................................8

Figure 1. 2: The Saigon Beer – Alcohol – Beverage Corporation located in Nguyen Chi

Thanh Street, Ward 5, HCMC............................................................................................13

Figure 2. 1: Model of supply chain components 14

Figure 2. 2: Supply Chain Management.............................................................................16

Figure 2. 3: Beer production process at SABECO...............................................................19

Figure 2. 4: Production of glass bottles Saigon Beer...........................................................21

Figure 2. 5: SABECO’s warehouse....................................................................................23

Figure 2. 6: Types of products of Saigon beer.....................................................................28

Figure 2. 7: Transport SABECO’s beers by truck................................................................32

Figure 2. 8: Flow in distribution channels..........................................................................40

Figure 3. 1: Sales result over the years since 2018 and plan for 2023 of SABECO

CHAPTER 1: OVERVIEW OF THE SAIGON BEER – ALCOHOL –

BEVERAGE CORPORATION – SABECO

Vietnamese consumers have long been familiar with the Saigon Beer brand of Saigon Beer

- Alcohol - Beverage Corporation - SABECO. In 2020, SABECO has gone through 145 years of

history and 43 years of building and developing the brand. From the 145-year milestone, the golden

flow of Beer has and will always be preserved by efforts to continue into the future, always existing

in the emotions of Vietnamese people proud of Vietnamese products.

The unique flavor of Saigon Beer is the crystallization of the products of the rich Southern

land and the generous spirit of Saigon people, becoming an indispensable part of daily happy and

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sad life. With 2 types of Larue bottled beer with a capacity of 610 ml and 333 bottled beer with a

capacity of 330ml at the beginning of the takeover, up to now, SABECO has developed 10 product

lines: Saigon Lager 450 bottled beer, Saigon Export bottled beer, and Saigon Special bottled beer.

, Saigon Lager 355 bottled beer, 333 Premium bottled beer, Lac Viet bottled beer, 333 canned beer,

Saigon Special canned beer, Saigon Lager canned beer, Lac Viet canned beer are fully present in

the market.

After 145 years of establishment and development, with many difficulties and challenges,

up to now, although there have been many famous beer brands in the world, Saigon Beer and Beer

333 are still the leading brands. Vietnamese brand leads the Vietnamese beer market and is on its

way to conquering demanding markets such as Germany, the US, Japan, the Netherlands, etc.

Figure 1. 1: Products of Saigon Beer Corporation – SABECO

1.1 General Information

- Name: SAIGON BEER – ALCOHOL – BEVERAGE CORPORATION

- Abbreviated name: SABECO

- Charter capital: 6,412,811,860,000 VND

- Legal representative – Chairman of the Board of Directors: Mr. Koh Poh Tiong

- General Director: Mr. Lester Tan Teck Chuan

- Registered office: 187 Nguyen Chi Thanh, Ward 12, District 5, City. Ho Chi Minh, Vietnam

- Head office: 5th Floor, Vincom Center Building, 72 Le Thanh Ton, Ben Nghe Ward, District

1,City. Ho Chi Minh, Vietnam

- Phone: (+84) 28 3829 4081 - 3829 4083 - 3829 6342

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- Fax: (+84) 028 3829 6856

- Email: Website: https://www.sabeco.com.vn

- Business license: 0300583659 issued by the Ho Chi Minh City Department of Planning and

Investment on April 17, 2008, adjusted for the 11th time on October 13, 2023

- Business lines: Producing and trading Beer, Alcohol and Beverage.

1.2 Outstanding Achievements

- LACVIET BEER, SAIGON LAGER BEER, SAIGON EXPORT BEER, SAIGON

GOLDBEER: Gold Medal “2023 World Beer Championships in USA”, from Chicago’s

Beverage

Testing Institute.

- BEER 333, SAIGON CHILL BEER, SAIGON SPECIAL BEER, SAIGON COFFEE -

INFUSED BEER: Silver Medal “2023 World Beer Championships in USA”, from Chicago’s

Beverage Testing Institute.

- SAIGON SPECIAL BEER, SAIGON EXPORT BEER: Silver Medal “2022 World BeerAwards

in UK”, from World Beer Award Publication.

- BEER 333, SAIGON LAGER BEER: Gold Medal “2022 World Beer Awards in UK”,

fromWorld Beer Award Publication.

- SAIGON SPECIAL BEER: Silver Medal “2022 Brussels Beer Challenge in Belgium” fromBeer

Communications & Events.

- SAIGON CHILL BEER: Gold Medal “2022 Asia Beer Championship in Singapore” from

AsiaBrewers Network.

- BEER 333, SAIGON GOLD BEER, LACVIET BEER: Silver Medal “Pilsen type”, 60

World

Selection 2021 of Beers, Waters and Soft Drinks 2022, from Monde Selection International

Quality Institute, Belgium.

- BEER 333: Silver Medal “Pilsen type”, 60

World Selection 2021 of Beers, Waters and Soft

Drinks 2021, from Monde Selection International Quality Institute, Belgium.

- SAIGON EXPORT BEER: Silver Medal “Pilsen type”, 60

World Selection 2021 of Beers,

Waters and Soft Drinks 2021, from Monde Selection International Quality Institute, Belgium.

- SAIGON CHILL BEER: Silver Medal “Other International Style Lager”, AIBA 2021, fromThe

Royal Agricultural Society of Victoria, Australia.

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- SAIGON LAGER BEER: Silver Medal “ Special or Regional beers”, 60

World Selection 2021

of Beers, Waters and Soft Drinks 2021, from Monde Selection International Quality Institute,

Belgium.

- SAIGON LAGER BEER: Silver Medal “Other International Style Lager”, AIBA 2021, fromThe

Royal Agricultural Society of Victoria, Australia.

- SAIGON SPECIAL BEER: Gold Medal “Pilsen type”, 60

World Selection 2021 of Beers,

Waters and Soft Drinks 2021, from Monde Selection International Quality Institute, Belgium.

- SAIGON GOLD BEER: Gold Medal “Australian Style Lager”, Australian International

BeerAwards 2021, from The Royal Agricultural Society of Victoria, Australia.

- BEER 333: Silver Medal "International Style Pilsener Runner - up", The International BeerCup

2019, from The Craft Beer Association, Japan.

- SAIGON SPECIAL BEER: Gold Medal “International Style Pilsener”, The International

BeerCup 2019, from The Craft Beer Association, Japan.

- SAIGON LAGER BEER: Champion “German Heritage”, The International Beer Cup

2019,from The Craft Beer Association, Japan.

- SAIGON LAGER BEER: Gold Medal “Light Lager”, The International Beer Cup 2019,

fromThe Craft Beer Association, Japan.

- SAIGON LAGER BEER: Gold Medal “International Small pack Lager Competition”, Class

1,The International Brewing Awards 2019, from The National Brewery Center, UK.

- BEER 333 PREMIUM EXPORT: AIBA International Rhyme Prize in Australia 2015.

1.3 Vision – Mission

Vision to 2025:

Develop SABECO into Vietnam's leading beverage industry corporation, with a position in the

region and internationally.

Mission:

- Contribute to the development of Vietnam's Beverage industry on a world-class level.

- Promote Vietnamese culinary culture.

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- Improve quality of life through providing high quality, safe and nutritious beverage products.

- Bring practical benefits to shareholders, customers, partners, employees and society.

- Satisfy and meet beverage needs according to international food safety and hygiene

standards"Food hygiene and safety and environmental protection".

- Fulfill all obligations to the State on the basis of transparency in business.

- Actively participate in community activities.

- Ensuring development towards international integration.

1.4 Oriented Development

SABECO continues to promote business activities towards effective and sustainable development

to affirm its leading position in the market.

Main issues:

- Sells:

• Focus on maintaining its domestic position, promoting exports and penetrating new markets.

• Diversify distribution channels, improve capacity and operational efficiency of the

distributionsystem.

- Trademark:

• Review brand positioning.

• Develop brand architecture.

- Manufacture:

• Ensure and improve product quality.

• Increase the operating efficiency of factories.

• Increase production management capacity and rationalize production and consumption areas.

- Supply chain:

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• Streamline warehousing and transportation.

• Optimize dispatch planning.

• Improve transportation services

- Activities of the Board of Directors and Executive Board:

• Internationalize operating activities by applying a management model according to

international practices, in which the Board of Directors plays the role of strategic direction and

the Executive Board is in charge of production, business and operating activities.

- Personnel:

• Strengthen employee engagement and make people a core competitive factor.

• Enhance open and transparent dialogue.

• Develop management policies and evaluate work performance.

• Increase employee work efficiency through annual training programs.

• Implement a salary structure based on capacity.

- Information Technology:

• Transforming the way of working by applying IT - SABECO 4.0.

Figure 1. 2: The Saigon Beer – Alcohol – Beverage Corporation located in Nguyen Chi

Thanh Street, Ward 5, HCMC

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CHAPTER 2: THE SUPPLY CHAIN OF SAIGON BEER CORPORATION

IN VIETNAM

2.1 Introduction about the supply chain

2.1.1 Definition

A supply chain is the network of all the individuals, organizations, resources, activities and

technology involved in the creation and sale of a product. A supply chain encompasses everything

from the delivery of source materials from the supplier to the manufacturer through to its eventual

delivery to the end user. The supply chain segment involved with getting the finished product from

the manufacturer to the consumer is known as the distribution channel.

During the production process, necessary planning is required to ensure the supply chain

operates at optimal efficiency. The concept of Supply Chain Management is the integration of key

business processes from the initial suppliers to the final link of the supply chain, that is, the

customer to provide products, services and information to create added value for customers and

shareholders of the business. The purpose of supply chain management is to maximize customer

value, deliver optimal efficiency, and achieve sustainable competitive advantage.

2.1.2 Supply chain components

Figure 2. 1: Model of supply chain components

The components of a supply chain include 5 main components:

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- Raw material supply: This is the first component and plays an important role in the

supplychain. Input materials are a key factor that determines product quality. If raw material

supplies are interrupted, production plans and supply chains will face problems.

- Producers: The producers will take on the role of processing raw materials to create

productsthat meet customer needs. Producers are components that directly affect the quality of

finished products.

- Distribution centers: are assigned the task of bringing products to customers.

However,distribution centers often ship large quantities of products, primarily sending products to

retail outlets rather than directly to the end consumer.

- Retailers: are grocery stores, supermarkets, convenience stores,... intermediaries

betweendistributors and consumers.

- Customers: are people who directly consume and use products and goods. This is also the

finalcomponent and the end of the supply chain.

2.1.3 Supply chain management

Supply chain management (SCM) is the oversight of materials, information and finances

as they move in a process from supplier to manufacturer to wholesaler to retailer and then to the

consumer. The three main flows of the supply chain are the product flow, the information flow and

the finances flow. These occur across three main stages: strategy, planning and operation.

SCM involves coordinating and integrating these flows both within and among companies.

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Figure 2. 2: Supply Chain Management

2.2 Demand management and planning

In the ever-evolving landscape of the global market, businesses face the imperative

challenge of not only meeting current demand but also strategically planning for future growth.

Demand management and planning play pivotal roles in ensuring a company's sustainability,

competitiveness, and resilience.

Sales, being the lifeblood of any successful enterprise, demand meticulous attention to both

domestic and export market dynamics. Saigon Beer, recognizing the need for sustained growth, is

actively boosting its presence in both arenas. Diversification of distribution channels, especially

through the expansion of e-commerce platforms, is a strategic move to meet the evolving

preferences of modern consumers. Simultaneously, improving the capacity and operational

efficiency of the distribution system ensures that products reach consumers in a timely and cost-

effective manner. Investing in the enhancement of salesforce competencies further fortifies the

company's ability to understand and respond to market demands dynamically.

On the production front, Saigon Beer is embracing a forward-looking approach by focusing

on brand expansion and innovations. This not only caters to the diverse preferences of consumers

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but also ensures the company remains at the forefront of the industry. Beyond profitability, there

is a keen emphasis on corporate sustainability development, aligning production processes with

environmental and social responsibility.

Supply chain optimization forms another critical pillar of Saigon Beer's demand

management strategy. Rationalizing warehouses and transportation, alongside optimizing route

planning, minimizes operational inefficiencies and contributes to a more streamlined and

costeffective supply chain. Improved delivery services further enhance customer satisfaction and

loyalty.

Recognizing that a company is only as strong as its people, Saigon Beer places a premium

on employee engagement and transparent communication. Open and transparent communication

channels foster a culture of collaboration and innovation. Policies aimed at managing and

evaluating work effectiveness provide employees with clear expectations, promoting

accountability and productivity. The company's commitment to employees' continuous

development is evident in the implementation of annual training programs, strengthening their

skills and knowledge base. Furthermore, a performance-based salary structure ensures that

employees are recognized and rewarded based on their contributions, fostering a culture of

excellence.

2.3 Procurement of the supply chain

2.3.1 Main ingredient

- Water:

Play the role of the main components make up a large proportion of beer, water usually account

for about 90-95% of the weight of a beer bottle. Water is a solvent that dissolves chemical

compounds (such as starch, sugar, protein, fat ...). Enzymes participate in the hydrolysis process

of breaking down high-molecular-weight compounds into simpler ones for yeast consumption.

Subsequently, the yeast continues to live and thrive in a water environment.

- Malt:

Malt, typically delivered from barley, is a crucial ingredient. It provides the sugar necessary for

fermentation, as well as the malty flavors and aromas that contribute to the beer’s profile. At the

brewing stage, the starch in malt is hydrolyzed by the amylase enzyme system into fermentable

sugars.

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- Hops:

Houblon hops are a fundamental ingredient after malt in beer production. They impart a pleasantly

mild bitterness, a highly distinctive aroma, enhance the ability to create and maintain foam,

increase adhesive strength, and stabilize the biological components of the product. In beer

production technology, only unpalliated female hop cones are utilized.

In some recent years, Yakima hops are replacing Houblon in some special flavor, make “Saigon

Special” much more special, go along with a new technology “dry-hopping”, Yakima hops bring

a mild bitterness accompanied by a distinctive aroma.

- Yeast:

Yeast plays a role in converting fermentable compounds in wort into alcohol and CO2 during

fermentation. In the fermentation process, yeast produces compounds that contribute aroma and

flavor to the beer. Different yeast strains yield distinctive beer flavors. Various breweries own

proprietary yeast strains, which are closely guarded and protected.

2.3.2 Production process

Figure 2. 3: Beer production process at SABECO

- Grinding mill

Grind small the malt into the particles size (or rice grain) to the required size so that the

ingredients in the material can be dissolved into water and release the enzyme to catalyze the

hydrolysis process.

- Malt cooker

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Hydrolysis of polymeric compounds such as starch, protein into fermentable compounds such as

maltose, glucose, amino acids, etc. At the end of the malt process, sweeteners are obtained and

this process called “Glucosinolation”.

- Filter pot

It is the process of removing ground paddy husk of malt seed from sugar solution.

- Boiling pot

The clear sugar is boiled with hops to produce a characteristic bitterness, while the boiling process

also evaporates and precipitates unwanted compounds and sterilizes the solution.

- Scale separator

Remove ingredients such as petal berry, the precipitate formed during boiling.

- Quick heat

0The boiled water (10 C) is brought to the appropriate temperature for the yeast to operate as 100

- 15oC. This temperature depends on the type of yeast and the type of beer.

- Fermentation tank

Refrigerated yeast and yeast are put into the fermenting tank for fermentation. Yeast along with

sugar is formed during cooking to form alcohol and CO2. Smell compounds for beer are also

produced by yeast in this period. At the end of fermentation, the yeast will be removed from the

fermenting tank for reuse for the next fermentation. The fermentation after fermentation will be

transferred to the brewing tank to start the secondary fermentation process.

- Beer brewing tank

The process of metabolizing or removing unwanted compounds formed during fermentation such

as diacetyl. The brewing process ends when the contents of the beer are reduced to the desired

level and reach the desired time of the beer.

- Long cooling

Beer pre-filtered will be cooled down to -1 and-2°C to form cold residue. These scales will be

removed during filtration in the later.

- Filter in beer

Yeast, cold residue, etc. will be removed to make the beer transparent.

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- Bright Beer Tank

The filtered beer is stored in the beer tank pending for the extract brewing and packaging process.

- Beer brew

In extract brewing, beer is extracted into different packaging to meet the needs of customers. Keg

beer has 2 liters capacity, 5 liters, 20 liters, 30 liters or 50 liters. Beer is extracted into a cans of

330ml, 500ml. Beer bottles have a capacity of 330ml, 450ml, 500ml, 750ml. Capacity of beer

bottles, beer can depends on the market strategy and consumer tastes of each country.

2.3.3 Quality control

Deployment and successful implementation:

• ISO 9001:2008 Quality Management System (quality management).

• ISO 14001 Quality Management System (environmental management).

• HACCP Quality Management System to control the quality, ensuring the taste, quality, andsafety

of the product when purchased.

• CIP (Cleaning in Place) and COP (Cleaning out of Place) sanitation systems.

Quality inspection:

• Microbiological testing in fermentation rooms.

• Chemical testing in a shared laboratory.

• Multiple quality checkpoints in the production process entirely operated by machinery,addressing

any detected errors immediately.

• Checking the cleanliness of bottle shells, identifying defects on bottles, and assessing qualityafter

washing.

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Figure 2. 4: Production of glass bottles Saigon Beer

2.4 Managing inventory flow

2.4.1 Goods characteristics

- Saigon Beer is the main product of Saigon Beer - Alcohol - Beverage Corporation

(SABECO),with two main packaging forms: cans and glass bottles. In this report, the team will

only analyze Saigon Beer products from a packaging perspective, not in-depth analysis of product

designs (green Saigon Beer, red Saigon Beer...)

- Aluminum can: Capacity 330ml. This is a popular form of Saigon Beer product because if

youwant to buy beer to take home or transport it far away, aluminum cans are the most suitable

option. In addition, Saigon Beer's aluminum can design also applies Ergonomics as the height is

not too high, helping drinkers not have to tilt their head too high when drinking, or has a larger

radius than other products other aluminum can products, to fit the hand of male customers (who

are the main customers of Saigon Beer).

- Glass bottle: Capacity 330ml. Saigon Beer has many types of glass bottles with

differentheights, serving many different customer groups, but they all use the same type of tank

for storage. In addition, the glass bottle design also applies Ergonomics in some points.

Aluminum cans (barrels)

Glass bottles (tanks)

Dimensions (cm)

18 x 12 x 24

30 x 25 x 24

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Number of products/ storage

units

24 cans

24 bottles

The highest number of floors

allowed

Number of units on each floor

Total units/pallet

Table 2. 1: Beer parameters for storage

2.4.2 Warehouse

2.4.2.1 Characteristic

Some warehouse characteristics:

- Built with a large area and in spacious, flat locations, with airy space to help facilitatethe

transportation process as well as improve the efficiency of preserving finished products.

- Warehouses are built in a closed architectural style to store and store raw materials, products

or goods for a certain period of time to protect goods from environmental

impact or loss or wastage deficit...

- Have an effective space suitable for its function, providing a safe and comfortable working

environment for workers with the goal of increasing productivity and control, reducing

operating costs as well as increasing productivity customer service level.

- The company's distribution warehouse in Vietnam is a level 1 distribution warehouse(i.e.

from factory ⇒ warehouse). Products after being produced from the factory are transferred to

this warehouse and further distributed to level 1 agents,... distributed to retail stores (levels

2,3,4,...) and final consumer.

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Figure 2. 5: SABECO’s warehouse

2.4.2.2 Warehouse location

- Saigon Beer - Alcohol - Beverage Corporation is a long-standing company, with asystem of

factories, warehouses, companies, offices,... stretching from North to South, plus hundreds of

Partners from large to small have created an extremely large logistics network with extremely

strong, seamless links. To analyze the effectiveness of that logistics network, the team will

analyze the warehouse system of Saigon - Cu Chi Brewery, located on the outskirts of Ho Chi

Minh City.

- The warehouse is about 20km from the center of Ho Chi Minh City, a large industrial park

with full facilities such as roads, landscapes, electricity and water systems, waste treatment

systems. At the same time, this area has easy access to an abundant unskilled labor force, as

well as being close to a major highway, creating a strong advantage for development.

2.4.3 Types of inventory

2.4.3.1 Definition of inventory

Inventory, or inventory, is a list of materials and products or the materials and products

themselves that are kept in stock by a business. If inventory management is done properly,

it can reduce costs and increase profits for the company.

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2.4.3.2 Inventory in Saigon Beer production

- Raw material inventory:

These are the raw materials needed for the product creation process, including:

• Danish malt

• Hops

• Yeast

• Materials

• High quality bottles, high quality cartons and paper boxes

• Processing additives

• Devices

These are the main raw materials that the company purchases for use in the production

process. Maintaining an appropriate amount of inventory will bring advantages to the

company in purchasing materials and production activities. In particular, the material

supply department will benefit when it can buy in large quantities and enjoy discounted

prices from suppliers. In addition, when a company predicts that in the future the price of

raw materials will increase or that a certain type of raw material will be scarce, or both,

keeping a large amount of inventory will ensure that the company is always fully supplied

in a timely manner at a stable cost. Semi-finished product inventory (unfinished products):

raw materials are in the production stage but not yet completed (not yet finished products).

- Inventory of semi-finished products:

Semi-finished product inventory includes all items that are currently at a stage (such as

unlabeled products, semi-finished products in transit warehouses between stages).

Semi-finished product inventory is an essential part of the production system. Thanks to

semi-finished product inventory, each stage in the production process will reduce

dependence on each other, causing disruption to other departments. In addition,

semifinished products help to effectively plan production for each stage and minimize costs

arising from production delays or free time.

- Inventory of finished products:

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It is the final product of the manufacturing process. Finished goods inventory includes

products that have completed the production process and are awaiting consumption. Except

for large-scale equipment, consumer goods and industrial products are mass produced and

stored in warehouses to meet expected future consumption.

2.4.4 Inventory management

Inventory management includes 3 main tasks:

- Manage product codes

- Manage warehoused goods

- Manage the warehouse delivery process

2.4.4.1 Manage product codes

- Receive new or changed information

• A product's product code may have to be added, changed or canceled.

• Management levels will send information to the warehouse manager.

• The warehouse manager will add, edit or delete.

- Check and compare with the product code in the warehouse

• Warehouse staff need to check and compare the actual status of products in the

warehouse.

- Update information

• Update product code information on the system

• Include information such as: date of modification, request document with validsignature

as well as the signature of the person who edited.

• To ensure if any unexpected incidents arise.

2.4.4.2 Manage warehoused goods

Warehouse goods management has the following operating procedures:

- Notice of warehouse import plan

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• Before each warehousing activity, a plan is made and discussed to find the most

optimalwarehousing direction.

- Check and compare actual goods

• Check and compare goods in the warehouse

• After the goods arrive at the warehouse, staff must check all information about the

shipment such as name, code, quantity and quality. As well as the standards specified in

the warehouse management process of materials and goods.

• The purpose of solving problems if there are defective goods from the supplier.

- Complete warehouse import procedures

• Warehouse management staff imports goods into the warehouse

• Then prepare stamped warehouse receipt documents as well as update information into

the system.

• This information is transferred to relevant departments such as accounting andproduction

for checking and comparison.

2.4.4.3 Manage the warehouse delivery process

For warehousing activities, the operating process is as follows:

- Receive warehouse delivery requests

• Staff will process the validity of the request and then continue processing such as

releasing the warehouse for sale, releasing the warehouse for production, assembling or

releasing the warehouse to move to another place.

- Check inventory

• Warehouse staff will check that product code at the warehouse. To know whether the

actual quantity is enough to export or not.

- Prepare delivery notes and invoices

• Staff prepare warehouse receipts and invoices for the company and customers to compare

and handle when problems arise.

- Export warehouse and update information

• Warehouse management staff will update information on the system

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• Report to relevant parties to proceed with warehouse release

2.4.5 Good characteristics

There are two types of Saigon beer sold in the market: glass bottle beer and canned beer.

Figure 2. 6: Types of products of Saigon beer

Aluminum cans (barrels)

Glass bottles (tanks)

Dimensions (cm)

30 x 25 x 12

30 x 25 x 24

Number of products/ storage

units

24 cans

24 bottles

The highest number of floors

allowed

Number of units on each floor

Total units/pallet

Table 2. 2: Size of the unit of goods

2.4.6 Warehouse of SABECO

- Warehouses are divided into 2 types:

• Dry material storage

• Warehouse for storing materials and finished products

- Regarding dry material storage:

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• Raw materials are the main materials that a company purchases to use in its production

process.Is where input materials are stored to produce beer (final product). Maintaining the

appropriate amount of raw materials will bring the company convenience in purchasing materials

and production activities. Such as: barley, Houblon flowers, rice, water, yeast

• Because of the nature of the materials, appropriate conditions and space are needed.

Likepulses, flowers, and rice, they need a dry, cool place to avoid mold. As for yeast, the right

temperature is needed so that the yeast does not get damaged.

- About finished product warehouse:

• Saigon Beer's finished product inventory includes products that have completed their production

cycle and are waiting to be shipped for consumption. Except for large-scale equipment, consumer

products and industrial products are mass produced and stored in warehouses to meet expected

future consumption. Specifically: bottles and cans (Hanacans Joint Stock Company, TCB Ball

Vietnam Beverage Can Company Limited...); label (Krones

Company, San Miguel Yamamura Phu Tho...); lid (Hercules VN Co., Ltd., Hanaka Co., Ltd....)

2.5 Transportation system

2.5.1 Overview of Saigon Beer Transportation and Logistics Joint Stock Company

(Sabetranjsc)

- Address: 8th Floor, No. 8 Nam Ky Khoi Nghia, Nguyen Thai Binh Ward, District 1, Ho Chi

Minh City.

- The predecessor was a fleet of vehicles taken over from BGI Company in 1977 under the Union

of Alcohol - Beer - Beverage Enterprises II. In 2005, the Company was equitized into Saigon

Beer Transportation and Delivery Joint Stock Company.

- Saigon Beer Transportation and Forwarding Joint Stock Company - Sabetranjsc is an

enterprisespecializing in transportation services serving Saigon Alcohol - Beer - Beverage Joint

Stock Corporation, playing an important role in the channel. Distribution and circulation of

goods is a link in Sabeco's system.

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- Sabeco's transportation system is two-way, from transporting finished goods (beer, wine, soft

drinks...) to transporting materials (cases, beer tanks...) to maximize energy. transportation

efficiency and cost savings.

- Currently, road transport accounts for the majority of the proportion in Sabeco's domestic

transport system. In addition, Sabeco also uses a variety of other types of transport such as

waterway and railway for its units. domestic and foreign suppliers.

2.5.2 Transportation system roles

- Transportation facilitates the movement of goods from suppliers to customers, which is

critical in logistics. Several transportation roles help to ensure a smooth logistical operation:

- Freight Transportation: The transportation of goods via various modes such as trucks, trains,

ships, and planes based on factors such as speed, cost, and the nature of the goods.

- Warehousing and Distribution Centers: These facilities serve as hubs for goods storage,

sorting,and distribution, and are frequently linked to transportation networks for easy access.

- Supply Chain Management: Coordination of transportation schedules, route optimization,

and timely delivery while minimizing costs and disruptions.

- Inventory Control: Maintaining stock levels in order to ensure that goods are available when

needed while avoiding overstocking, which affects transportation volume.

- Carrier and Freight Services: Transportation companies such as carriers, freight forwarders,

and brokers.play vital roles in executing logistics plans and ensuring goods reach their destinations.

- Last-Mile Delivery: Finishing the final phase of delivery to the customer's door, which

frequently involves local transportation methods such as vans, bikes, or even walking.

- Technology Integration: Using technology to improve transportation efficiency and

visibility, such as GPS, route optimization software, and real-time tracking.

- Regulatory Compliance: Knowing and following transportation regulations, such as permits,

safety standards, and international trade laws.

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- Risk Management: Identifying potential transportation risks (for example, weather,

accidents, and delays) and putting strategies in place to mitigate their impact on logistics

operations. - Customer Service: Providing updates, answering questions, and ensuring a positive

customer experience throughout the transportation process.

Each of these roles is critical to establishing a seamless and efficient transportation system within

logistics, ensuring that goods are delivered reliably, on time, and at a reasonable cost.

2.5.3 Modes of transport

- Saigon beer is used in many forms of transportation: by sea, by air, by train or by road. It also

hires many third-party logistics companies for shipping. In particular, road transport is

considered the most flexible method developed by the road system.

- Shipping by air is the fastest way. However, the cost is also the highest.

- Shipping by sea: can transport large amounts of products at the same time at a lower cost but

also takes more time than other shipping methods.

- Besides, containers can also be used to continue transport by road or train at the customs

clearance location. Saigon Beer is considering choosing the shipping method by sea, including

the cost of loading goods onto the ship, related licenses,...

- Transport by train: economical and effective for transporting goods from one place to another.

Countries with high-speed train systems such as Europe, Japan or China will benefit from this

method.

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Figure 2. 7: Transport SABECO’s beers by truck

2.5.4 Advantages and disadvantages for the Saigon Beer transportation system

2.5.4.1 Advantages

- Vietnam's geographical location is extremely favorable

- More than 3000 km of coastline

- Located at the international maritime intersection

- Favorable terrain to develop strategic ports

- Convenient for sea transportation (low cost, large volume of goods).

2.5.4.2 Disadvantages

- Law: There are quite a few documents, but specific policies detailing those policies have

not been implemented or are overlapping, leading to long immigration processing times.

- Natural environment: On average each year, Vietnam has 10 - 12 storms hitting the

mainland and on average, Coca-Cola's transportation system will be stopped for 1 - 2

weeks.

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- Infrastructure: The road transport system in some areas is in poor condition.Besides, there

is no North-South expressway. The highway system is being expanded but not much.

Furthermore, the entire South has only 90 km of expressways with a maximum speed of

120 km (the world average is 220 km).

- Warehouse: Vietnam still lacks centralized logistics zones with strategic locations,

synchronized with the system of ports, airports, national highways, and production

facilities; supply and demand imbalance at southern seaports

2.6 Distribution channel

2.6.1 Distribution channel

2.6.1.1 Concept

A distribution channel is a set of interdependent organizations, individuals, vehicles, and

technologies that play a role in the process of getting products or services from the place

of production to the hands of consumers or targeted customer entities.

Individuals and organizations participating in the channel are considered

members. Those members situated between consumers and producers are referred to as

distribution intermediaries.

2.6.1.2 The role of the distribution channel

For customers:

Ensuring availability: The distribution channel functions to ensure the supply of

products that customers need in a short period and at convenient locations. Customers can

purchase products at grocery stores, supermarkets, distribution points, etc., instead of

having to go to the production site.

Ease of selection and purchase: Customers can easily and conveniently choose

and purchase products through direct information or product display. Additionally, many

distribution points represent the manufacturer to provide technical support, product

advice, helping to save costs and time for customers.

For manufacturers:

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Market coverage: Manufacturers, with the help of the distribution channel, can

bring their products to various points of sale for consumers in need, effectively covering

the market without spending too much time.

Market understanding: The distribution channel is a tool that manufacturers utilize

to capture the market, understand the needs and purposes of customers regarding the

product, and learn a bit about competitors.

Bridge between production and consumers: The distribution channel is considered

a bridge between manufacturing businesses and consumers. The distribution network

helps bring products from manufacturers to consumers conveniently and quickly.

The entire channel supports manufacturers in effectively caring for customers in

services such as product usage guidance, warranty, maintenance, ordering, shipping,

complaint handling, etc.

2.6.1.3 Types of Distribution Channels

- Direct Distribution Channel: This channel involves only two entities, the

manufacturer and the end consumer. The product is directly distributed to the consumer

without intermediaries. The structure of the direct distribution channel is: P (Producer) -

> C (Consumer).

- Indirect Distribution Channel: In the indirect distribution channel, there are two

types: traditional distribution channel and modern distribution channel.

- Traditional Distribution Channel: This channel involves multiple stages, with the

product passing through intermediaries before reaching the end consumer.

+ Level 1: P (Manufacturer) -> R (Retailer) -> C (Consumer)

+ Level 2: P (Manufacturer) -> W (Wholesaler) -> R (Retailer) -> C (Consumer)

+ Level 3: P (Manufacturer) -> A&B (Brokers) -> W (Wholesaler) -> R (Retailer) -> C

(Consumer)

- Modern Distribution Channel: In this channel, the manufacturer and distribution

intermediaries work together as a unified entity. Products are distributed directly from this

unified entity to the end consumer. The benefit of this channel is cost and time savings in

the transportation process.

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- Multilevel Distribution Channel (Hybrid): In this distribution channel, entities

other than the manufacturer act as intermediaries or may also be consumers. Implementing

a multilevel distribution channel can have advantages in saving advertising costs, but a

commission must still be paid to the intermediaries.

2.6.2 Members in the Distribution Channel of Saigon Beer

- Manufacturer: The Saigon Alcohol, Beer, and Beverage Corporation, with 26

manufacturing plants, is responsible for supplying products to the members in the distribution

channel.

- Distributor: Level 1 Distributor: The first distributor in the distribution channel directly

transacts with the company regarding policies and distribution conditions. They receive goods

directly from the company, possess capital, warehouses, and transportation means. Distributors

must adhere to principles such as ensuring sales volume, providing information to retailers and

end consumers, and offering feedback to the manufacturer. Distributors receive commissions

based on achieved sales targets, with potential reductions for underperformance.

• Advantages:

For the Company: Bulk consumption, shared risks, multiple points of contact with end consumers.

For Consumers: Access to wholesale-priced products, assurance of product availability.

• Disadvantages:

For the Company: Conflict resolution among distributors can be time-consuming, and negative

distributor attitudes may impact the company's image.

For Consumers: Limited availability for purchasing small quantities.

- Supermarkets: These represent a mixed or specialized distribution channel with

sophisticated and convenient services for customers. Supermarkets, favored by consumers, directly

receive goods from the company and have capital, display areas, warehouses, and transportation

means.

• Advantages:

For the Company: Direct interaction with end consumers, diverse and abundant store systems.

For Consumers: Ensured product availability, prices not affected by external factors, confidence

in quality, comfortable shopping experience.

• Disadvantages:

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For the Company: Competing with rival products, sales heavily depend on supermarket display

strategies.

For Consumers: Prices may be higher compared to small retailers.

- Key Accounts: These are significant consumers of a business, often focusing on large target

groups such as restaurants, hotels, eateries, and bars. Key Accounts receive goods directly from

the company, are monitored but not managed by the company, and have direct interaction with

customers.

• Advantages:

For the Company: Direct interaction with end consumers, diverse and abundant store systems.

For Consumers: Assured product availability.

• Disadvantages:

For the Company: Selling products of competitors, challenging to control the sales volume, cutting

company promotions for additional profit.

- Retailers: Encompassing businesses, organizations, and individuals selling goods to

individual consumers or households, retailers are in direct contact with the end consumer,

understanding their needs and desires better than anyone else.

- End Consumers: Including individual consumers, industrial users, and professional

organizations, end consumers are the ultimate target of the entire commercial system.

2.6.3. Distribution Channel Structure

Currently, SABECO has a network of 26 factories, 10 member trading companies, and a network

of over 100,000 points of sale across the country. SABECO owns multiple beer brands in the

market, such as Bia Saigon Special, Bia Saigon Export, Bia Saigon Lager, Bia Saigon Gold, and

Bia 333.

The establishment of 10 joint-stock trading companies in 10 key provinces and cities in the

North, Central, and South regions aims to foster the bond of distributors in distributing SABECO's

products. This strategy focuses on deepening the market, avoiding overlap and competition among

distributors, ensuring SABECO's products reach consumers quickly and conveniently.

The Saigon Alcohol, Beer, and Beverage Corporation is organizing its distribution channel

according to the parent company - subsidiary model to enhance distribution efficiency and save

distribution costs.

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- Online Channel: Collaborating with e-commerce platforms such as Lazada, Shopee, Tiki,

etc., to make its products available on these online marketplaces. These platforms act as traditional

agents for SABECO, placing orders from SABECO and distributing them to online customers.

- Offline Channel: SABECO utilizes a parallel distribution system, including both a one-tier

and a two-tier channel.

- One-tier Channel: SABECO directly distributes Bia Saigon Lager to major consumers, such

as large supermarkets nationwide (Co-op mart, BigC, Vinmart, Metro, Saigon Tourist, etc.) and

small retail chains (Familymart, Circle K, Ministop, Bach Hoa Xanh, etc.). Additionally, this

channel includes Key Accounts (restaurants, bars, hotels, institutions, etc.) with large sales

volumes. This channel is essential for promoting the company's image, introducing products to

consumers, and significantly influencing customer preferences.

Two-tier Channel: This is a strategic sales channel for SABECO. Level 1 distributors directly

receive goods from Saigon Beer Trading Co., Ltd., and distribute them to level 2 distributors.

Recommendations for Channel Improvement:

+ For the Company:

Develop a unified distribution strategy for the entire distribution channel system, providing

specific regulations for each member to create a strong and cohesive distribution system.

Offer special assistance in training human resources and sales capabilities for new distributors.

Strengthen cooperation with tourism companies to increase the company's visibility.

Increase advertising activities to promote the brand and the company's image, enhancing

competitiveness against competitors.

+ For Distributors:

Adhere to contract regulations, avoid territorial encroachment, price manipulation, and refrain

from dealing with low-quality products.

Establish close ties with other channel members with a spirit of mutual development, minimizing

conflicts.

2.6.4 Distribution Channel Design Process

Step 1: Implementing General Strategy

• Regularly analyze and evaluate the distribution results of focused distributors, identifying

conflicts within the channel:

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• Vertical conflicts: between focused distributors and Saigon Beer Manufacturing Company

regarding discount payment issues.

Horizontal conflicts: among focused distributors competing for market share, retail spaces, and

against competitors.

Step 2: Analyzing Influencing Variables

• Analyze variables that influence distribution decisions:

• Characteristics of target customers/market.

• Market geography.

• Product characteristics.

• Company characteristics.

Step 3: Determining Distribution Objectives

• Batch size: 1 pallet (48 cases of bottles or 120 cases of cans) per order with a lead time of

1 day.

• Optimal location: Distributors located in the center of the customer circle to minimize the

distance from distributors to customers.

Step 4: Identifying Channel Structure and Selecting Optimal Channels

• Three-tier channel: Distributing Saigon Beer to all supermarkets, wholesalers, then

supplying to locations such as restaurants, eateries, convenience stores, and finally

reaching end consumers.

Step 5: Classifying Distribution Functions

Beer Saigon:

+ Store goods, ensure order fulfillment for level 1 intermediaries.

+ Execute transportation to level 1 intermediaries.

+ Provide support services for intermediaries.

• Exclusive distribution agent:

+ Store and preserve goods.

+ Arrange and classify goods according to customer needs (retailers).

+ Place orders and receive orders.

+ Collect market information and transfer it to Saigon Beer.

+ Sales: seek customers, sell products, provide services to customers (exchange near-expiry

products, display products according to company regulations at retail stores, etc.).

• Other level 1 intermediaries:

+ Provide sales points, sales staff.

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+ Display products and promotional activities at the point of sale.

+ Distribute appropriate quantities of goods according to consumer demand.

+ Sell products to end consumers.

2.6.5 Distribution Channel Management

Managing distribution channels is always a challenge for businesses. An efficient system not only

ensures tight management processes and widespread, timely service but also serves as a way to

quickly reach consumers to gain a competitive advantage in the market. Thanks to the application

of information technology, SABECO has effectively managed its product distribution channels.

To effectively manage the distribution channels in the Saigon Beer market, exploring the use of

modern information technology applications is essential. Examples include the Oracle E Business

Suite 11i integrated information management program, Enterprise Resource Planning (ERP)

systems, and Customer Relationship Management (SAP) solutions. These technologies can

enhance the efficiency of distribution channel management for Saigon Beer, ensuring precise

control and timely service delivery.

2.6.6 Distribution Channel flows

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Figure 2. 8: Flow in distribution channels

Retailers in the distribution channel will directly place orders with wholesalers, and these

wholesalers will then place orders with Saigon Beer Trading Company based on the region,

depending on the quantity of orders and the current inventory levels.

For one-tier channels such as supermarkets and Key Accounts, they will place orders directly with

the company without going through any intermediaries.

- Information Flow:

Information is smoothly and continuously transmitted among channel members. The company

provides information about product categories, weight, size, prices, payment terms, discounts, etc.,

to distribution intermediaries and end consumers. The company also receives feedback from other

channel members to leverage, improve, and address weaknesses in the system.

Furthermore, the information flow helps SABECO effectively monitor the activities of

distributors. Distribution-related information is held by the Sales Support department, then

reported to the Consumption-Market-Brand Board for processing and resolving issues to

contribute to better market development and profitability for the company.

- Material Flow and Packaging Retrieval:

In the material flow and packaging retrieval process, the role of the transportation company is

particularly crucial. It is known that the company specializing in transportation for SABECO is

Saigon Beer Transportation and Delivery Joint Stock Company (Sabetranjsc). For products such

as wine, beer, and soft drinks, the company transports using trucks and containers based on the

payload and terrain of the region.

The packaging retrieval process runs counter to the material flow, moving from end consumers

back to the manufacturer. SABECO endeavors to thoroughly retrieve cans, bottles, and beer crates

for reuse, minimizing costs and contributing to environmental protection.

- Ownership Transfer Flow:

The ownership transfer flow runs parallel to the material flow; as products are transferred to

channel members, ownership is also transferred to them.

- Payment Flow:

For wholesalers, supermarkets, and key accounts, payments are typically made through bank

transfers. For small retailers or end consumers, they make direct cash payments.

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- Negotiation Flow:

Through contracts, SABECO negotiates with distributors to sell products at agreed-upon prices

and implement all promotional programs in line with the company's objectives.

2.6.7 Saigon Beer distribution channel system

2.6.7.1 Domestic

According to statistics, by the end of 2020, Saigon Alcohol - Beer - Beverage

Corporation had 10 regional trading companies, 26 subsidiaries, present throughout

Vietnam with 600,000 people + point of sale.

SABECO's market share in 2018 and 2019 accounted for the largest proportion,

but look tend to decrease due to increasingly fierce competition from competitors. Faced with this

difficult situation and the negative effects of the Covid-19 pandemic on the beer industry,

SABECO is required to have timely strategies to ensure sustainable

development and increase the competitiveness of the beer industry enterprise.

2.6.7.2 Foreign

Saigon Beer is popular with customers around the world and has been exported to 38

countries:

- Europe: France, Netherlands, England, Sweden, Switzerland, Russia, Denmark, Spain,

Czech Republic, Austria, Italy, Germany, Romania

- Asia: Laos, China, Taiwan, Japan, Hong Kong, Korea, Thailand, Singapore, Bahrain,

Israel

- Americas: United States, Canada, Panama

- Oceania: Australia, New Zealand, Kiribati

- Africa: Equatorial Guinea, Gabon, Cameroon, Ghana, Republic of Congo, Benin,

Liberia and Sierra Leone

2.6.7.3 Functions of the distribution channel system

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Distribution channel members perform many important functions including:

- Information function: collect and distribute information about actors and forces in the

distribution system, supporting the company in making strategic decisions.

- Promotion function: deploy and distribute programs to bring the company's image to

customers, enhance the company's brand

- Contact function: plays an important role in learning about and introducing the company's

products to the market

- Negotiation function: to agree on a reasonable price so that the sale goes well-

Transportation and storage functions: ensure stability in providing products to customers

- Funding assurance function: finding and using capital sources to offset distribution costs-

Risk function: accept risks in your business.

2.6.7.4 The role of the distribution channel system

PRODUCTION ➡ DISTRIBUTION ➡ CONSUMERS

- Distribution of goods and products is a part of production relations, a link between

themproduction and consumption. The distribution system plays an important role in the

process of providing customers with the right products, at the right time, in the right

location, so distribution channels directly affect the success or failure of businesses in

general and for SABECO in particular.

- The distribution system helps adjust the supply and demand of goods and services,

helping businesses focus on specializing in their production activities. Thanks to the

distribution network, businesses can overcome time constraints and increase the ability

to choose goods for customers. Philip Kotler (2008) proposed three basic roles of

distribution channels as follows: increasing transaction efficiency; increase product

supply efficiency; satisfy customers' needs and types of goods.

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CHAPTER 3: PROBLEM AND SOLUTION

3.1. Problems in Distribution Network

3.1.1. Imbalanced Distribution Market

Saigon Beer Corporation encounters challenges in accessing and effectively operating within

the rural market, particularly in deep rural regions, remote areas, and island districts. This situation

indicates an imbalanced distribution market, where there is a disparity or unevenness in the

availability and accessibility of products and services.

Solution:

- Establish Regional Distribution Centers: Set up regional distribution centers strategically

located in or near rural areas. These centers can act as hubs for storing and distributing products to

the surrounding regions. By having distribution centers closer to the target market, transportation

costs and delivery times can be reduced.

- Develop Last-Mile Delivery Solutions: Invest in last-mile delivery solutions tailored for rural

areas. This may involve utilizing smaller vehicles, motorbikes, or bicycles to navigate through

narrow roads and reach remote locations. Additionally, consider partnering with local logistics

providers who have expertise in navigating the specific terrain and infrastructure challenges of

rural regions.

- Collaborate with Local Retailers: Build partnerships with local retailers, including small

grocery stores, convenience shops, and village cooperatives, to expand the reach of Saigon Beer

Company's products. These retailers have a better understanding of the local market and can serve

as distribution points in rural areas. Provide incentives and support to encourage their participation

in promoting and selling the company's products.

- Utilize Mobile Sales and Sampling: Deploy mobile sales and sampling teams to visit rural

areas, setting up temporary stalls or vehicles to showcase and sell Saigon Beer Company's

products. This approach can help generate awareness, trial, and ultimately drive sales in remote

regions where traditional retail infrastructure may be limited.

- Leverage Digital Platforms: Utilize digital platforms, such as e-commerce websites and

mobile apps, to enable online ordering and delivery of products in rural areas. Partner with existing

e-commerce platforms that have a presence in rural markets or establish a dedicated online

platform to facilitate direct sales to consumers.

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- Conduct Rural Marketing Campaigns: Develop targeted marketing campaigns specifically

tailored to the rural market. This can include localized advertising, sponsorships of local events,

and engagement with rural communities through social media platforms. Focus on highlighting

the unique value propositions of Saigon Beer Company's products that resonate with rural

consumers.

- Provide Training and Support: Offer training programs and support to distributors, retailers,

and sales teams operating in rural areas. This can include product knowledge training, sales and

marketing techniques, and guidance on effective merchandising and display practices. By

empowering local stakeholders, the distribution and promotion of Saigon Beer Company's

products can be improved.

- Monitor and Evaluate Performance: Implement a system to monitor and evaluate the

performance of the distribution process in rural areas. Regularly assess key performance indicators

such as sales volume, market share, and customer satisfaction to identify areas for improvement

and make necessary adjustments to the distribution strategy.

3.1.2. Inaccurate Order Fulfillment

Saigon Beer Company faces challenges in accurately processing and fulfilling customer orders.

This can result in incorrect or incomplete products being delivered to customers, leading to

customer dissatisfaction and potential financial losses for the company.

Solution:

- Implement an automated order processing system: Invest in an automated order processing

system that minimizes manual intervention. This system should have features such as automated

order entry, real-time inventory tracking, and automated picking and packing processes. By

reducing manual errors, the system can improve order accuracy.

- Enhance inventory management: Implement an efficient inventory management system that

provides real-time visibility into stock levels. This system should integrate with the order

processing system to ensure accurate fulfillment based on available inventory. Regular stock audits

and cycle counts can help identify and rectify any discrepancies.

- Improve communication channels: Establish clear and effective communication channels

between different departments involved in the order fulfillment process, such as sales, warehouse,

and logistics teams. Regularly communicate order requirements and any updates or changes to

ensure accurate fulfillment.

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- Standardize packaging and labeling processes: Develop standardized packaging and

labeling procedures to ensure consistency and accuracy. Clearly define packaging requirements

and labeling instructions to avoid confusion during the fulfillment process. Conduct regular quality

checks to ensure packaging and labeling accuracy.

- Implement quality control measures: Introduce quality control measures throughout the

order fulfillment process, including random checks of packed orders before shipping. This can help

identify and rectify errors before products are dispatched to customers.

- Provide training and support: Train employees involved in the order fulfillment process on

proper procedures, accuracy requirements, and the importance of attention to detail. Offer regular

refresher training sessions and provide ongoing support to address any challenges or questions that

may arise.

- Customer feedback and resolution: Establish a mechanism to collect customer feedback on

order accuracy. Actively address any issues or complaints related to inaccurate order fulfillment

promptly and provide appropriate resolutions to ensure customer satisfaction.

3.1.3. Exchange and Return

Saigon Beer Company lacks appropriate regulations and has not satisfactorily addressed cases

where customers purchase faulty products. It will also lead to customer dissatisfaction and

potential financial losses for the company.

Solution:

- Clear and customer-friendly policies: Develop clear and easily understandable exchange and

return policies that are prominently communicated to customers. Ensure that the policies include

information on acceptable reasons for exchanges or returns, timelines, and any specific

requirements or conditions. Make these policies accessible through the company's website,

customer service channels, and product packaging.

- Streamlined exchange and return processes: Establish well-defined and efficient procedures

for processing exchanges and returns. This includes providing clear instructions to customers on

how to initiate the process, specifying required documentation (such as proof of purchase), and

designating dedicated staff or departments responsible for handling exchanges and returns.

Streamlining the process will help minimize delays and errors.

- Training and empowerment of customer service staff: Provide comprehensive training to

customer service representatives to handle exchanges and returns effectively. Equip them with the

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necessary knowledge and tools to address customer concerns promptly and professionally.

Empower customer service staff to make decisions within the established policies to resolve

customer issues efficiently.

- Simplified return logistics: Design a straightforward and convenient return process for

customers. This can involve providing prepaid return labels or arranging for product pickups from

customers' locations. Simplifying the logistics will make it easier for customers to return products,

thereby improving their overall experience.

- Continuous feedback analysis: Regularly analyze customer feedback related to exchanges

and returns to identify recurring issues, patterns, or areas for improvement. Actively listen to

customer concerns and use their feedback to refine policies and processes to better address their

needs.

- Quality control and product improvement: Implement stringent quality control measures to

minimize the occurrence of product issues that lead to exchanges and returns. Continuously

monitor and evaluate product quality, and address any recurring issues promptly. This proactive

approach will help reduce the need for exchanges and returns in the first place.

3.2. Problems in Inventory Management

3.2.1. Inefficient product storage managing

Managing the storage of products by distributors presents many challenges. It leading to

several negative consequences and impacts on various aspects of the distribution network.

Solution:

- Optimize Warehouse Layout: Evaluate and optimize the layout of the warehouse to maximize

space utilization and streamline product flow. This includes organizing products in logical

categories, creating clear aisles, and utilizing efficient shelving systems.

- Implement Inventory Tracking Systems: Adopt inventory management systems or software

that provide real-time visibility and accurate tracking of inventory. This enables distributors to

monitor stock levels, track product movement, and identify potential issues promptly.

- Enhance Product Labeling and Categorization: Implement clear labeling and

categorization systems to facilitate easy identification and retrieval of products. Utilize barcode or

RFID technology to streamline inventory tracking and reduce errors.

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- Establish Stock Rotation Procedures: Develop and enforce stock rotation procedures, such

as the First-In, First-Out (FIFO) method, to ensure older products are used or sold before newer

ones. Regularly review inventory to identify slow-moving or obsolete items and take appropriate

actions.

- Improve Storage Conditions: Assess and improve storage conditions to protect products from

damage or deterioration. This may involve implementing proper temperature and humidity

controls, investing in appropriate packaging materials, or implementing security measures to

prevent theft.

- Regular Audits and Continuous Improvement: Conduct regular audits of the storage area to

identify inefficiencies and areas for improvement. Seek feedback from warehouse staff and

stakeholders to implement continuous improvement measures and optimize storage practices.

3.2.2. Excessive or Insufficient Inventory

Maintaining excessive inventory ties up valuable capital and storage space, increases carrying

costs, and can lead to obsolescence or spoilage. On the other hand, insufficient inventory can result

in stockouts, missed sales opportunities, and dissatisfied customers.

Solution:

- Optimize Demand Forecasting: Improve demand forecasting accuracy through the use of

data analysis, historical sales data, market trends, and customer insights. This helps to align

inventory levels with expected demand, reducing the risk of both excess and insufficient inventory.

- Implement Just-in-Time (JIT) Inventory Management: Adopt JIT principles to minimize

inventory levels while ensuring that products are available when needed. JIT allows for

streamlined inventory replenishment based on actual demand, reducing the risk of excess inventory

and associated costs.

- Set Reorder Points and Safety Stock Levels: Determine optimal reorder points and safety

stock levels for each product based on lead times, demand variability, and desired service levels.

This helps to prevent stockouts while avoiding excessive inventory accumulation.

- Establish Effective Supplier Relationships: Collaborate closely with suppliers to improve

visibility and communication. Implement vendor-managed inventory (VMI) or consignment

programs where appropriate, allowing suppliers to monitor and manage inventory levels on behalf

of the distributor.

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- Utilize Inventory Management Systems: Implement inventory management software or

systems that provide real-time visibility into inventory levels, sales data, and demand patterns.

This enables better decision-making and inventory control, reducing the risk of excessive or

insufficient inventory.

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Implement ABC Analysis and SKU Rationalization: Conduct an ABC analysis to categorize

products based on their value and contribution to sales. Focus on optimizing inventory

management for high-value products while considering SKU rationalization for slow-moving or

low-demand items.

- Enhance Communication and Collaboration: Improve communication and collaboration

between different departments involved in inventory management, such as sales, marketing,

operations, and finance. This ensures better alignment between inventory levels and anticipated

demand.

- Continuous Monitoring and Optimization: Regularly monitor inventory levels, sales data,

and market trends to identify patterns and potential issues. Conduct regular inventory audits to

identify slow-moving or obsolete items, and take proactive steps to optimize inventory levels and

minimize risks.

- Streamline Order Fulfillment Processes: Streamline and automate order fulfillment

processes to improve efficiency and reduce lead times. This includes optimizing picking, packing,

and shipping processes to ensure accurate and timely order fulfillment.

- Regular Performance Evaluation: Continuously evaluate the effectiveness of inventory

management strategies through key performance indicators (KPIs) such as inventory turnover

ratio, stockouts rate, and carrying costs. Use this data to identify areas for improvement and

implement necessary adjustments.

3.3. Problems in Transportation Process

3.3.1. Compliance and Regulatory Issues

The policies regarding port entry and clearance are not clear despite the existence of numerous

documents addressing this issue, resulting in prolonged port entry and clearance times, which

impact contracts, economy, and quality.

Solution:

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- Policy Review and Standardization: Conduct a comprehensive review of existing policies

and regulations related to port entry and clearance. Identify areas of ambiguity or inconsistency

and work towards standardizing and clarifying these policies.

Stakeholder Collaboration: Engage with relevant stakeholders, including port authorities,

customs agencies, shipping lines, and industry associations, to gather input and insights on the

challenges and areas of improvement. Foster collaboration to streamline processes and ensure

clarity in policies.

- Publish Clear Guidelines and Procedures: Develop clear and concise guidelines and

procedures regarding port entry and clearance. These documents should outline the necessary

steps, required documentation, and compliance requirements for smooth and efficient processes.

- Training and Awareness Programs: Conduct training programs and workshops to educate

stakeholders, including importers, exporters, freight forwarders, and customs brokers, about the

policies and procedures related to port entry and clearance. Enhance awareness and understanding

of compliance requirements to avoid delays and non-compliance issues.

- Communication Channels: Establish effective communication channels for disseminating

information and updates regarding port entry and clearance policies. Utilize websites, newsletters,

email notifications, and online portals to provide timely information to stakeholders.

- Dedicated Helpdesk or Support: Set up a dedicated helpdesk or support team to address

queries and provide guidance on port entry and clearance processes. This helps stakeholders

navigate through the policies and procedures and resolve any issues they may encounter.

- Regular Policy Updates: Maintain an ongoing review process for port entry and clearance

policies to ensure they remain up to date with changing regulations and industry requirements.

Communicate any updates or changes promptly to stakeholders to avoid confusion and

noncompliance.

- Collaboration with International Standards: Align port entry and clearance policies with

international standards and best practices to facilitate smoother trade operations and reduce barriers

to global trade.

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- Performance Monitoring and Evaluation: Implement a system to monitor and evaluate the

performance of port entry and clearance processes. Track key performance indicators (KPIs) such

as average clearance times, compliance rates, and customer satisfaction to identify areas for

improvement and measure progress.

Continuous Improvement: Foster a culture of continuous improvement and feedback loops

to address any issues or challenges that arise in the port entry and clearance processes. Encourage

stakeholders to provide feedback and suggestions for enhancing the efficiency and clarity of the

policies.

3.3.2. Insufficient Transportation Infrastructure System

The transportation infrastructure system has severely deteriorated or has not been fully utilized

on a large scale, resulting in various difficulties in the transportation process such as prolonged

transit times or increased transportation costs.

Solution:

- Collaboration with Government and Authorities: Engage in proactive collaboration with

government agencies and transportation authorities to address the issues related to insufficient

transportation infrastructure. Advocate for infrastructure development projects and provide input

on the specific needs of the logistics industry.

- Infrastructure Investment: Explore opportunities to invest in transportation infrastructure or

support infrastructure development initiatives. Collaborate with public or private entities to improve

road networks, expand ports or terminals, and enhance transportation connectivity in regions critical

for the company's logistics operations.

- Strategic Warehouse Placement: Optimize the placement of warehouses and distribution

centers considering the existing transportation infrastructure limitations. Locate facilities closer to

major transportation hubs or areas with better connectivity to minimize transit times and

transportation costs.

- Modal Shift and Intermodal Transportation: Explore modal shift options to leverage

different transportation modes and overcome infrastructure limitations. Utilize intermodal

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transportation, combining multiple modes such as road, rail, and waterways, to optimize logistics

operations and mitigate the impact of insufficient infrastructure on transit times and costs.

- Route Optimization: Implement advanced route optimization tools and technologies to

identify the most efficient and reliable transportation routes given the existing infrastructure

constraints. Continuously monitor and update routes based on real-time data to minimize delays

and transportation costs.

lOMoARcPSD|36991220

- Collaboration with Logistics Providers: Collaborate closely with logistics service

providers that have expertise in navigating challenging transportation infrastructures. Leverage

their knowledge and experience to identify alternative routes, optimize transportation processes,

and reduce the impact of infrastructure limitations on logistics operations.

- Data-Driven Decision Making: Utilize data analytics and predictive modeling to make

informed decisions regarding logistics operations. Analyze historical data, traffic patterns, and

infrastructure constraints to optimize transportation planning, scheduling, and resource allocation.

- Supply Chain Visibility and Transparency: Implement supply chain visibility solutions to

track and monitor the movement of goods throughout the transportation process. This helps

identify bottlenecks, anticipate delays, and proactively address issues arising from insufficient

transportation infrastructure.

- Continuous Improvement and Innovation: Foster a culture of continuous improvement and

innovation within the logistics operations of Saigon Beer Company. Encourage employees to

identify opportunities for process optimization, explore new technologies, and implement

innovative solutions to mitigate the impact of insufficient infrastructure.

- Public-Private Partnerships: Explore opportunities for public-private partnerships to

jointly invest in and improve transportation infrastructure. Collaborate with local authorities,

industry associations, and other stakeholders to advocate for infrastructure development projects

that benefit the logistics industry as a whole.

3.3.3. Abnormal Weather Conditions

In Vietnam, there are typically 10 to 12 landfalling typhoons annually. During this period, the

road and waterway systems, especially in the Central region, often experience disruptions and

closures for an average of 1 to 2 weeks. It also prolongs transit times and increases transportation

costs.

Solution:

- Emergency Preparedness: Develop a comprehensive emergency preparedness plan

specifically tailored to address the challenges posed by abnormal weather conditions. This plan

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should include protocols for assessing risks, implementing contingency measures, and

coordinating with logistics partners to ensure minimal disruptions to the supply chain.

- Alternative Transportation Modes: Explore alternative transportation modes that are less

susceptible to disruptions caused by typhoons. This may include utilizing air freight or inland

waterway transportation for the delivery of raw materials and finished products during periods

when road and waterway systems are affected.

- Diversification of Suppliers: Identify and establish relationships with multiple suppliers

located in different regions, both within and outside Vietnam. This diversification reduces

dependence on a single supplier and allows for quicker recovery in the event of disruptions caused

by typhoons.

- Real-Time Monitoring and Tracking: Implement real-time monitoring and tracking

systems to closely monitor the movement of goods along the supply chain. This enables Saigon

Beer Company to proactively identify disruptions and adjust logistics operations accordingly.

- Safety Stock and Warehousing: Maintain safety stock levels of raw materials and finished

products to buffer against potential disruptions and delays caused by typhoons. Additionally,

consider establishing strategically located warehouses in different regions to store excess

inventory and ensure availability during transportation disruptions.

- Route Optimization: Continuously review and optimize transportation routes to minimize

exposure to areas prone to typhoon-related disruptions. Use advanced route planning and

optimization tools to identify the most efficient and resilient routes for product distribution.

- Communication and Information Sharing: Establish effective communication channels

with logistics partners, suppliers, and distributors to share timely information about disruptions

and recovery efforts. This facilitates collaborative decision-making and allows for proactive

measures to address logistical challenges.

- Training and Capacity Building: Provide training and capacity-building programs for

logistics staff to enhance their understanding of the challenges posed by abnormal weather

conditions. Equip them with the necessary skills and knowledge to effectively manage logistics

operations during and after typhoon events.

lOMoARcPSD|36991220

- Continuous Improvement: Regularly evaluate logistics performance, gather feedback from

stakeholders, and identify areas for improvement. Implement continuous improvement initiatives

to enhance the resilience and efficiency of logistics processes, taking into account lessons learned

from past typhoon events.

3.3.4. Inefficient Transportation Process

Saigon Beer Corporation currently has 26 breweries, 10 subsidiary trading companies, and a

network of over 200,000 retail outlets nationwide. The persistent issue in the transportation process

of the company: The transportation process has not been standardized, resembling a complex

matrix with numerous truck routes, distribution points, and warehouses.

Solution:

- Standardization and Process Optimization: Conduct a comprehensive review of the

transportation process within Saigon Beer Company. Identify areas of inefficiency, bottlenecks,

and inconsistencies. Develop standardized procedures, guidelines, and best practices to streamline

and optimize the transportation process.

- Centralized Transportation Management: Establish a centralized transportation

management system or department to oversee and coordinate all transportation activities across

the company's network. This centralization allows for better control, visibility, and coordination

of truck routes, distribution points, and warehouses.

- Route Planning and Optimization: Implement advanced route planning and optimization

tools to optimize truck routes based on factors such as distance, traffic conditions, and delivery

schedules. This helps to minimize transit times, reduce fuel consumption, and improve overall

efficiency in the transportation process.

- Warehouse Management System (WMS): Implement a robust warehouse management

system to optimize warehouse operations, inventory management, and order fulfillment. This

includes features such as real-time inventory tracking, automated picking and packing, and

efficient loading and unloading processes.

- Collaboration with Logistics Partners: Collaborate closely with logistics service

providers, including trucking companies and distribution partners, to streamline operations and

lOMoARcPSD|36991220

improve efficiency. Establish clear communication channels, share data and information, and align

processes and goals to ensure smooth coordination in the transportation process.

- Technology Integration: Leverage technology solutions such as GPS tracking, telematics,

and IoT (Internet of Things) devices to monitor and track the movement of goods in real-time.

This provides better visibility and enables proactive management of transportation activities.

- Performance Monitoring and KPIs: Define key performance indicators (KPIs) to measure

and monitor the performance of the transportation process. Regularly review and analyze these

metrics to identify areas for improvement and implement corrective actions as needed.

- Continuous Improvement Culture: Foster a culture of continuous improvement within the

logistics operations of Saigon Beer Company. Encourage employees to contribute ideas, provide

feedback, and participate in process improvement initiatives to enhance the efficiency of the

transportation process.

- Employee Training and Development: Provide training programs and development

opportunities for employees involved in the transportation process. This includes training on best

practices, use of technology tools, and fostering skills in logistics management and optimization.

- Data Analytics and Insights: Utilize data analytics tools to analyze transportation data and

derive actionable insights. This helps in identifying trends, inefficiencies, and areas for

improvement in the transportation process, enabling data-driven decision-making.

3.3.5. Loss of Goods during Transportation

Loss or damage of raw materials and finished products during the transportation process is

inevitable.

Solution:

- Robust Packaging and Secure Loading: Ensure that goods are properly packaged and

secured to minimize the risk of damage during transportation. Use appropriate packaging

materials, such as protective padding, shrink wrap, or pallets, to safeguard the goods. Train loading

personnel on proper loading techniques to prevent shifting or damage during transit.

- Quality Control Checks: Implement rigorous quality control checks at various stages of the

transportation process. Inspect goods before loading them onto trucks, and conduct periodic checks

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during transit to identify any signs of damage or potential issues. This allows for early detection

and timely corrective actions.

- Tracking and Monitoring Systems: Utilize tracking and monitoring systems, such as GPS

or RFID technology, to have real-time visibility of the goods during transportation. This enables

proactive tracking, monitoring, and intervention in case of any deviations or incidents that may

lead to loss or damage.

- Insurance Coverage: Obtain appropriate insurance coverage for goods in transit to mitigate

the financial impact of any loss or damage. Work with insurance providers to understand the

coverage options available and ensure that the policies adequately cover the value of the goods

being transported.

- Vendor and Carrier Selection: Conduct thorough due diligence when selecting vendors

and carriers for transportation services. Evaluate their track record, reliability, and commitment to

safety and security. Choose reputable and experienced partners who prioritize the safe handling

and delivery of goods.

- Training and Education: Provide training and education programs for employees involved

in the transportation process. Train them on proper handling techniques, loading and unloading

procedures, and best practices for ensuring the integrity and safety of goods during transit.

- Route Planning and Risk Assessment: Conduct route planning and risk assessments to

identify potential hazards or high-risk areas along transportation routes. Take necessary

precautions to minimize the exposure of goods to risks such as accidents, theft, or adverse weather

conditions.

- Incident Response and Recovery Plan: Develop an incident response and recovery plan to

address any unforeseen events or incidents that may result in the loss or damage of goods during

transportation. This includes having clear protocols and procedures in place to mitigate the impact,

initiate investigations, and implement corrective actions.

- Continuous Improvement Practices: Foster a culture of continuous improvement within

the logistics operations of Saigon Beer Company. Encourage employees to provide feedback, share

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lessons learned, and contribute ideas for enhancing the safety and security of goods during

transportation.

3.3.6. Fluctuate Transportation Costs

In an open economy, the demand for transportation of goods constantly fluctuates across

different periods. The demand can significantly increase during peak seasons such as holidays and

festivals, which has a substantial impact on the transportation costs of various types of goods,

including Saigon beer, a product with high demand in the Vietnamese market. Moreover, during

peak periods like the Lunar New Year, transportation costs tend to escalate, thereby affecting the

product's pricing. Therefore, finding ways to mitigate the impact of these periods during the

transportation process is a challenging task that Saigon Beer Company needs to address.

Solution:

- Market Analysis and Forecasting: Conduct regular market analysis and forecasting to

understand the trends and factors influencing transportation costs. Stay informed about changes in

fuel prices, labor costs, regulatory policies, and market demand that can impact transportation

costs. Use this information to anticipate fluctuations and make informed decisions.

- Contract Negotiation: Establish long-term contracts or partnerships with transportation

service providers to secure stable rates and mitigate the impact of cost fluctuations. Negotiate

favorable terms, including fixed rates or rate adjustment mechanisms tied to specific cost indices,

to ensure cost stability.

- Strategic Sourcing: Explore multiple transportation service providers and compare their

pricing structures, services, and reliability. Consider leveraging a mix of transportation modes,

such as road, rail, or sea, to optimize costs based on specific requirements and market conditions.

- Route Optimization: Optimize transportation routes to minimize distance, fuel

consumption, and overall transportation costs. Utilize route planning software or work with

logistics experts to identify the most efficient routes that balance cost and delivery timelines.

- Consolidation and Collaboration: Explore opportunities for consolidating shipments or

collaborating with other companies to share transportation costs. Consolidated shipments can

result in better negotiation power with carriers and reduce transportation expenses.

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- Performance Monitoring and Carrier Evaluation: Regularly monitor the performance of

transportation service providers to ensure they are delivering services in line with agreed-upon

rates and service levels. Evaluate carrier performance based on cost-effectiveness, reliability, and

customer satisfaction.

- Continuous Cost Analysis: Implement a system for ongoing cost analysis and tracking of

transportation expenses. Identify cost drivers, analyze spending patterns, and identify areas for

cost reduction or optimization. This data-driven approach helps in proactively managing

transportation costs.

- Fuel Efficiency Initiatives: Implement fuel-saving initiatives such as optimizing vehicle

loading, maintaining proper tire pressure, and promoting eco-driving practices. These initiatives

can help reduce fuel consumption and lower transportation costs.

- Collaboration with Industry Associations: Engage with industry associations or trade

organizations that focus on transportation and logistics. Stay updated on industry trends,

participate in discussions on cost management strategies, and network with peers to share insights

and best practices.

- Continuous Improvement and Negotiation: Continuously seek opportunities for

improvement and cost optimization within the transportation process. Regularly review contracts,

negotiate rates, and explore innovative solutions or technologies that can lower transportation costs

without compromising service quality.

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Figure 3. 1: Sales result over the years since 2018 and plan for 2023 of SABECO

CHAPTER 4: CONCLUSION

In the current trend of deep integration into the world economy, the right strategy plays a

decisive role in the development and growth of businesses. With persistent and stable development

efforts, constantly improving quality, diversifying products to satisfy consumer expectations,

currently - Saigon Beer is occupying the leading position in the Beer industry. VN and was honored

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to be recognized as a National Brand 5 times in a row. Saigon Beer is also proud to become the

351st member at the Berlin Beer Academy - one of the cradles of global beer culture. Members in

the chain, each unit has its own role. Although it is "separate", it is extremely unified and tight,

creating the success of the entire supply chain. However, there are still limitations of the supply

chain that have not been noticed. SABECO's supply chain has achieved certain successes, thanks

to the close systematic connection of parts in the chain. Therefore, it is necessary to make the most

of it to improve the efficiency of the Company's supply chain management. From the above

analysis, Vietnamese beverage companies need to draw lessons for themselves to be able to

develop stronger. With the unremitting efforts of each member of the supply chain, in the future

SABECO will certainly grow stronger.

REFERENCES

1) https://www.sabeco.com.vn

2)https://dantri.com.vn/kinh-doanh/cong-thuc-thanh-cong-cua-thuong-hieu-bia-144-nam-tuoi-

lOMoARcPSD| 36991220

20190919145525588.htm 3)https://www.studocu.com/vn/document/truong-dai-hoc-lao-dong-xa-

hoi-co-so-2/kinh-te-vimo/bullwhip-sabeco-chia/26557610

4)https://www.sabeco.com.vn/Data/Sites/1/media/co%20dong/bao%20cao%20thuong%20nien/

20-04-2021/2020AR%20-%20VN.pd

5) http://biasaigonbaclieu.com/cong-nghe/san-xuat-bia/quy-trinh-san-xuat-bia.aspx

6) https://vipanco.com/tim-hieu-quy-trinh-san-xuat-bia-sai-gon-chat-luong/#xay-gao

7)https://vietstock.vn/2023/04/dhdcd-sabeco-ke-hoach-ky-luc-thau-tom-sabibeco-va-thay-

ceo737-1065206.htm

8)https://cafef.vn/sabeco-duoc-vinh-danh-doanh-nghiep-tieu-bieu-vi-nguoi-lao-dong-

188231031164723942.chn

9) https://thoibaotaichinhvietnam.vn/tiet-giam-gia-thanh-dau-vao-loi-nhuan-sabeco-tang-toc-

antuong-124746.html

10)https://daibieunhandan.vn/kinh-te-xa-hoi/sabeco-ba-thang-dau-nam-lai-rong-hon-1-000-

tydong-i335164/

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lOMoARcPSD| 36991220 ABSTRACT
During the research and study process to complete our group assignment report, we
received a lot of guidance from our teacher as well as help from our classmates to ensure the best completion of this report.
We would like to express special thanks to Assoc.Prof Ph.D Lê Ngọc Quỳnh Lam for her
detailed guidance and explanations regarding the knowledge of Management Business Logistics.
Thanks to her instructions, our group was able to better understand the project topic and
complete this assignment on time.
Although we have tried our best to complete this report, there are still some shortcomings
in terms of assuming data due to our limited practical experience. We sincerely hope for
understanding and constructive feedback from our teacher and peers so that we can improve the
report and gain experience for future assignments. We would like to express our sincere gratitude. TABLE OF CONTENTS
CHAPTER 1: OVERVIEW OF THE SAIGON BEER – ALCOHOL – BEVERAGE
CORPORATION – SABECO ..................................................................................................3
1.1 General Information .........................................................................................................4
1.2 Outstanding Achievements ...............................................................................................5
1.3 Vision – Mission .................................................................................................................6
1.4 Oriented Development .......................................................................................................7
CHAPTER 2: THE SUPPLY CHAIN OF SAIGON BEER CORPORATION IN ......9
VIETNAM ....................................................................................................................................9
2.1 Introduction about the supply chain ..............................................................................9
2.1.1 Definition .........................................................................................................................9
2.1.2 Supply chain components ................................................................................................9
2.1.3 Supply chain management .............................................................................................10
2.2 Demand management and planning ............................................................................11
2.3 Procurement of the supply chain ..................................................................................12
2.3.1 Main ingredient .............................................................................................................12
2.3.2 Production process ........................................................................................................13 lOMoARcPSD| 36991220
2.3.3 Quality control ..............................................................................................................15
2.4 Managing inventory flow ...............................................................................................16
2.4.1 Goods characteristics ....................................................................................................16
2.4.2 Warehouse .....................................................................................................................17
2.4.3 Types of inventory .........................................................................................................18
2.4.4 Inventory management ..................................................................................................20
2.4.5 Good characteristics .....................................................................................................22
2.4.6 Warehouse of SABECO .................................................................................................22
2.5 Transportation system .....................................................................................................23
2.5.1 Overview of Saigon Beer Transportation and Logistics Joint Stock Company ...........23
(Sabetranjsc) ..........................................................................................................................23
2.5.2 Transportation system roles ..........................................................................................24
2.5.3 Modes of transport ........................................................................................................25
2.5.4 Advantages and disadvantages for the Saigon Beer transportation system .................26
2.6 Distribution channel .......................................................................................................27
2.6.1 Distribution channel ......................................................................................................27
2.6.2 Members in the Distribution Channel of Saigon Beer ..................................................29
2.6.3. Distribution Channel Structure ....................................................................................30
2.6.4 Distribution Channel Design Process ...........................................................................31
2.6.5 Distribution Channel Management ...............................................................................33
2.6.6 Distribution Channel flows ...........................................................................................33
2.6.7 Saigon Beer distribution channel system ......................................................................35
CHAPTER 3: PROBLEM AND SOLUTION ....................................................................37
3.1. Problems in Distribution Network ...............................................................................37
3.1.1. Imbalanced Distribution Market ..................................................................................37
3.1.2. Inaccurate Order Fulfillment .......................................................................................38
3.1.3. Exchange and Return ...................................................................................................39
3.2. Problems in Inventory Management ...........................................................................40
3.2.1. Inefficient product storage managing ..........................................................................40
3.2.2. Excessive or Insufficient Inventory ..............................................................................41
3.3. Problems in Transportation Process ...........................................................................43
3.3.1. Compliance and Regulatory Issues ..............................................................................43 1 lOMoARcPSD| 36991220
3.3.2. Insufficient Transportation Infrastructure System .......................................................45
3.3.3. Abnormal Weather Conditions .....................................................................................47
3.3.4. Inefficient Transportation Process ...............................................................................49
3.3.5. Loss of Goods during Transportation ..........................................................................50
3.3.6. Fluctuate Transportation Costs ...................................................................................52
CHAPTER 4: CONCLUSION ...............................................................................................54
REFERENCES ......................................................................................................................55 LIST OF TABLES
Table 2. 1: Beer parameters for storage..............................................................................22
Table 2. 2: Size of the unit of goods 28 2 lOMoARcPSD| 36991220 LIST OF FIGURES
Figure 1. 1: Products of Saigon Beer Corporation – SABECO..............................................8
Figure 1. 2: The Saigon Beer – Alcohol – Beverage Corporation located in Nguyen Chi
Thanh Street, Ward 5, HCMC............................................................................................13
Figure 2. 1: Model of supply chain components 14
Figure 2. 2: Supply Chain Management.............................................................................16
Figure 2. 3: Beer production process at SABECO...............................................................19
Figure 2. 4: Production of glass bottles Saigon Beer...........................................................21
Figure 2. 5: SABECO’s warehouse....................................................................................23
Figure 2. 6: Types of products of Saigon beer.....................................................................28
Figure 2. 7: Transport SABECO’s beers by truck................................................................32
Figure 2. 8: Flow in distribution channels..........................................................................40
Figure 3. 1: Sales result over the years since 2018 and plan for 2023 of SABECO
CHAPTER 1: OVERVIEW OF THE SAIGON BEER – ALCOHOL –
BEVERAGE CORPORATION – SABECO
Vietnamese consumers have long been familiar with the Saigon Beer brand of Saigon Beer
- Alcohol - Beverage Corporation - SABECO. In 2020, SABECO has gone through 145 years of
history and 43 years of building and developing the brand. From the 145-year milestone, the golden
flow of Beer has and will always be preserved by efforts to continue into the future, always existing
in the emotions of Vietnamese people proud of Vietnamese products.
The unique flavor of Saigon Beer is the crystallization of the products of the rich Southern
land and the generous spirit of Saigon people, becoming an indispensable part of daily happy and 3 lOMoARcPSD| 36991220
sad life. With 2 types of Larue bottled beer with a capacity of 610 ml and 333 bottled beer with a
capacity of 330ml at the beginning of the takeover, up to now, SABECO has developed 10 product
lines: Saigon Lager 450 bottled beer, Saigon Export bottled beer, and Saigon Special bottled beer.
, Saigon Lager 355 bottled beer, 333 Premium bottled beer, Lac Viet bottled beer, 333 canned beer,
Saigon Special canned beer, Saigon Lager canned beer, Lac Viet canned beer are fully present in the market.
After 145 years of establishment and development, with many difficulties and challenges,
up to now, although there have been many famous beer brands in the world, Saigon Beer and Beer
333 are still the leading brands. Vietnamese brand leads the Vietnamese beer market and is on its
way to conquering demanding markets such as Germany, the US, Japan, the Netherlands, etc.
Figure 1. 1: Products of Saigon Beer Corporation – SABECO
1.1 General Information
- Name: SAIGON BEER – ALCOHOL – BEVERAGE CORPORATION - Abbreviated name: SABECO
- Charter capital: 6,412,811,860,000 VND
- Legal representative – Chairman of the Board of Directors: Mr. Koh Poh Tiong
- General Director: Mr. Lester Tan Teck Chuan
- Registered office: 187 Nguyen Chi Thanh, Ward 12, District 5, City. Ho Chi Minh, Vietnam
- Head office: 5th Floor, Vincom Center Building, 72 Le Thanh Ton, Ben Nghe Ward, District 1,City. Ho Chi Minh, Vietnam
- Phone: (+84) 28 3829 4081 - 3829 4083 - 3829 6342 4 lOMoARcPSD| 36991220 - Fax: (+84) 028 3829 6856
- Email: Website: https://www.sabeco.com.vn
- Business license: 0300583659 issued by the Ho Chi Minh City Department of Planning and
Investment on April 17, 2008, adjusted for the 11th time on October 13, 2023
- Business lines: Producing and trading Beer, Alcohol and Beverage.
1.2 Outstanding Achievements
- LACVIET BEER, SAIGON LAGER BEER, SAIGON EXPORT BEER, SAIGON
GOLDBEER: Gold Medal “2023 World Beer Championships in USA”, from Chicago’s Beverage Testing Institute.
- BEER 333, SAIGON CHILL BEER, SAIGON SPECIAL BEER, SAIGON COFFEE -
INFUSED BEER: Silver Medal “2023 World Beer Championships in USA”, from Chicago’s Beverage Testing Institute.
- SAIGON SPECIAL BEER, SAIGON EXPORT BEER: Silver Medal “2022 World BeerAwards
in UK”, from World Beer Award Publication.
- BEER 333, SAIGON LAGER BEER: Gold Medal “2022 World Beer Awards in UK”,
fromWorld Beer Award Publication.
- SAIGON SPECIAL BEER: Silver Medal “2022 Brussels Beer Challenge in Belgium” fromBeer Communications & Events.
- SAIGON CHILL BEER: Gold Medal “2022 Asia Beer Championship in Singapore” from AsiaBrewers Network.
- BEER 333, SAIGON GOLD BEER, LACVIET BEER: Silver Medal “Pilsen type”, 60th World
Selection 2021 of Beers, Waters and Soft Drinks 2022, from Monde Selection International Quality Institute, Belgium.
- BEER 333: Silver Medal “Pilsen type”, 60th World Selection 2021 of Beers, Waters and Soft
Drinks 2021, from Monde Selection International Quality Institute, Belgium.
- SAIGON EXPORT BEER: Silver Medal “Pilsen type”, 60th World Selection 2021 of Beers,
Waters and Soft Drinks 2021, from Monde Selection International Quality Institute, Belgium.
- SAIGON CHILL BEER: Silver Medal “Other International Style Lager”, AIBA 2021, fromThe
Royal Agricultural Society of Victoria, Australia. 5 lOMoARcPSD| 36991220
- SAIGON LAGER BEER: Silver Medal “ Special or Regional beers”, 60th World Selection 2021
of Beers, Waters and Soft Drinks 2021, from Monde Selection International Quality Institute, Belgium.
- SAIGON LAGER BEER: Silver Medal “Other International Style Lager”, AIBA 2021, fromThe
Royal Agricultural Society of Victoria, Australia.
- SAIGON SPECIAL BEER: Gold Medal “Pilsen type”, 60th World Selection 2021 of Beers,
Waters and Soft Drinks 2021, from Monde Selection International Quality Institute, Belgium.
- SAIGON GOLD BEER: Gold Medal “Australian Style Lager”, Australian International
BeerAwards 2021, from The Royal Agricultural Society of Victoria, Australia.
- BEER 333: Silver Medal "International Style Pilsener Runner - up", The International BeerCup
2019, from The Craft Beer Association, Japan.
- SAIGON SPECIAL BEER: Gold Medal “International Style Pilsener”, The International
BeerCup 2019, from The Craft Beer Association, Japan.
- SAIGON LAGER BEER: Champion “German Heritage”, The International Beer Cup
2019,from The Craft Beer Association, Japan.
- SAIGON LAGER BEER: Gold Medal “Light Lager”, The International Beer Cup 2019,
fromThe Craft Beer Association, Japan.
- SAIGON LAGER BEER: Gold Medal “International Small pack Lager Competition”, Class
1,The International Brewing Awards 2019, from The National Brewery Center, UK.
- BEER 333 PREMIUM EXPORT: AIBA International Rhyme Prize in Australia 2015. 1.3 Vision – Mission Vision to 2025:
Develop SABECO into Vietnam's leading beverage industry corporation, with a position in the region and internationally. Mission:
- Contribute to the development of Vietnam's Beverage industry on a world-class level.
- Promote Vietnamese culinary culture. 6 lOMoARcPSD| 36991220
- Improve quality of life through providing high quality, safe and nutritious beverage products.
- Bring practical benefits to shareholders, customers, partners, employees and society.
- Satisfy and meet beverage needs according to international food safety and hygiene
standards"Food hygiene and safety and environmental protection".
- Fulfill all obligations to the State on the basis of transparency in business.
- Actively participate in community activities.
- Ensuring development towards international integration.
1.4 Oriented Development
SABECO continues to promote business activities towards effective and sustainable development
to affirm its leading position in the market. Main issues: - Sells:
• Focus on maintaining its domestic position, promoting exports and penetrating new markets.
• Diversify distribution channels, improve capacity and operational efficiency of the distributionsystem. - Trademark: • Review brand positioning.
• Develop brand architecture.
• Develop brand architecture. - Manufacture:
• Ensure and improve product quality.
• Increase the operating efficiency of factories.
• Increase production management capacity and rationalize production and consumption areas. - Supply chain: 7 lOMoARcPSD| 36991220
• Streamline warehousing and transportation.
• Optimize dispatch planning.
• Improve transportation services
- Activities of the Board of Directors and Executive Board:
• Internationalize operating activities by applying a management model according to
international practices, in which the Board of Directors plays the role of strategic direction and
the Executive Board is in charge of production, business and operating activities. - Personnel:
• Strengthen employee engagement and make people a core competitive factor.
• Enhance open and transparent dialogue.
• Develop management policies and evaluate work performance.
• Increase employee work efficiency through annual training programs.
• Implement a salary structure based on capacity.
- Information Technology:
• Transforming the way of working by applying IT - SABECO 4.0.
Figure 1. 2: The Saigon Beer – Alcohol – Beverage Corporation located in Nguyen Chi
Thanh Street, Ward 5, HCMC 8 lOMoARcPSD| 36991220
CHAPTER 2: THE SUPPLY CHAIN OF SAIGON BEER CORPORATION IN VIETNAM
2.1 Introduction about the supply chain
2.1.1 Definition
A supply chain is the network of all the individuals, organizations, resources, activities and
technology involved in the creation and sale of a product. A supply chain encompasses everything
from the delivery of source materials from the supplier to the manufacturer through to its eventual
delivery to the end user. The supply chain segment involved with getting the finished product from
the manufacturer to the consumer is known as the distribution channel.
During the production process, necessary planning is required to ensure the supply chain
operates at optimal efficiency. The concept of Supply Chain Management is the integration of key
business processes from the initial suppliers to the final link of the supply chain, that is, the
customer to provide products, services and information to create added value for customers and
shareholders of the business. The purpose of supply chain management is to maximize customer
value, deliver optimal efficiency, and achieve sustainable competitive advantage.
2.1.2 Supply chain components
Figure 2. 1: Model of supply chain components
The components of a supply chain include 5 main components: 9 lOMoARcPSD| 36991220 -
Raw material supply: This is the first component and plays an important role in the
supplychain. Input materials are a key factor that determines product quality. If raw material
supplies are interrupted, production plans and supply chains will face problems. -
Producers: The producers will take on the role of processing raw materials to create
productsthat meet customer needs. Producers are components that directly affect the quality of finished products. -
Distribution centers: are assigned the task of bringing products to customers.
However,distribution centers often ship large quantities of products, primarily sending products to
retail outlets rather than directly to the end consumer. -
Retailers: are grocery stores, supermarkets, convenience stores,... intermediaries
betweendistributors and consumers. -
Customers: are people who directly consume and use products and goods. This is also the
finalcomponent and the end of the supply chain.
2.1.3 Supply chain management
Supply chain management (SCM) is the oversight of materials, information and finances
as they move in a process from supplier to manufacturer to wholesaler to retailer and then to the
consumer. The three main flows of the supply chain are the product flow, the information flow and
the finances flow. These occur across three main stages: strategy, planning and operation.
SCM involves coordinating and integrating these flows both within and among companies. 10 lOMoARcPSD| 36991220
Figure 2. 2: Supply Chain Management
2.2 Demand management and planning
In the ever-evolving landscape of the global market, businesses face the imperative
challenge of not only meeting current demand but also strategically planning for future growth.
Demand management and planning play pivotal roles in ensuring a company's sustainability,
competitiveness, and resilience.
Sales, being the lifeblood of any successful enterprise, demand meticulous attention to both
domestic and export market dynamics. Saigon Beer, recognizing the need for sustained growth, is
actively boosting its presence in both arenas. Diversification of distribution channels, especially
through the expansion of e-commerce platforms, is a strategic move to meet the evolving
preferences of modern consumers. Simultaneously, improving the capacity and operational
efficiency of the distribution system ensures that products reach consumers in a timely and cost-
effective manner. Investing in the enhancement of salesforce competencies further fortifies the
company's ability to understand and respond to market demands dynamically.
On the production front, Saigon Beer is embracing a forward-looking approach by focusing
on brand expansion and innovations. This not only caters to the diverse preferences of consumers 11 lOMoARcPSD| 36991220
but also ensures the company remains at the forefront of the industry. Beyond profitability, there
is a keen emphasis on corporate sustainability development, aligning production processes with
environmental and social responsibility.
Supply chain optimization forms another critical pillar of Saigon Beer's demand
management strategy. Rationalizing warehouses and transportation, alongside optimizing route
planning, minimizes operational inefficiencies and contributes to a more streamlined and
costeffective supply chain. Improved delivery services further enhance customer satisfaction and loyalty.
Recognizing that a company is only as strong as its people, Saigon Beer places a premium
on employee engagement and transparent communication. Open and transparent communication
channels foster a culture of collaboration and innovation. Policies aimed at managing and
evaluating work effectiveness provide employees with clear expectations, promoting
accountability and productivity. The company's commitment to employees' continuous
development is evident in the implementation of annual training programs, strengthening their
skills and knowledge base. Furthermore, a performance-based salary structure ensures that
employees are recognized and rewarded based on their contributions, fostering a culture of excellence.
2.3 Procurement of the supply chain
2.3.1 Main ingredient - Water:
Play the role of the main components make up a large proportion of beer, water usually account
for about 90-95% of the weight of a beer bottle. Water is a solvent that dissolves chemical
compounds (such as starch, sugar, protein, fat ...). Enzymes participate in the hydrolysis process
of breaking down high-molecular-weight compounds into simpler ones for yeast consumption.
Subsequently, the yeast continues to live and thrive in a water environment. - Malt:
Malt, typically delivered from barley, is a crucial ingredient. It provides the sugar necessary for
fermentation, as well as the malty flavors and aromas that contribute to the beer’s profile. At the
brewing stage, the starch in malt is hydrolyzed by the amylase enzyme system into fermentable sugars. 12 lOMoARcPSD| 36991220 - Hops:
Houblon hops are a fundamental ingredient after malt in beer production. They impart a pleasantly
mild bitterness, a highly distinctive aroma, enhance the ability to create and maintain foam,
increase adhesive strength, and stabilize the biological components of the product. In beer
production technology, only unpalliated female hop cones are utilized.
In some recent years, Yakima hops are replacing Houblon in some special flavor, make “Saigon
Special” much more special, go along with a new technology “dry-hopping”, Yakima hops bring
a mild bitterness accompanied by a distinctive aroma. - Yeast:
Yeast plays a role in converting fermentable compounds in wort into alcohol and CO2 during
fermentation. In the fermentation process, yeast produces compounds that contribute aroma and
flavor to the beer. Different yeast strains yield distinctive beer flavors. Various breweries own
proprietary yeast strains, which are closely guarded and protected.
2.3.2 Production process
Figure 2. 3: Beer production process at SABECO - Grinding mill
Grind small the malt into the particles size (or rice grain) to the required size so that the
ingredients in the material can be dissolved into water and release the enzyme to catalyze the hydrolysis process. - Malt cooker 13 lOMoAR cPSD| 36991220
Hydrolysis of polymeric compounds such as starch, protein into fermentable compounds such as
maltose, glucose, amino acids, etc. At the end of the malt process, sweeteners are obtained and
this process called “Glucosinolation”. - Filter pot
It is the process of removing ground paddy husk of malt seed from sugar solution. - Boiling pot
The clear sugar is boiled with hops to produce a characteristic bitterness, while the boiling process
also evaporates and precipitates unwanted compounds and sterilizes the solution. - Scale separator
Remove ingredients such as petal berry, the precipitate formed during boiling. - Quick heat
0The boiled water (10 C) is brought to the appropriate temperature for the yeast to operate as 100̊
- 15oC. This temperature depends on the type of yeast and the type of beer. - Fermentation tank
Refrigerated yeast and yeast are put into the fermenting tank for fermentation. Yeast along with
sugar is formed during cooking to form alcohol and CO2. Smell compounds for beer are also
produced by yeast in this period. At the end of fermentation, the yeast will be removed from the
fermenting tank for reuse for the next fermentation. The fermentation after fermentation will be
transferred to the brewing tank to start the secondary fermentation process. - Beer brewing tank
The process of metabolizing or removing unwanted compounds formed during fermentation such
as diacetyl. The brewing process ends when the contents of the beer are reduced to the desired
level and reach the desired time of the beer. - Long cooling
Beer pre-filtered will be cooled down to -1 and-2°C to form cold residue. These scales will be
removed during filtration in the later. - Filter in beer
Yeast, cold residue, etc. will be removed to make the beer transparent. 14 lOMoARcPSD| 36991220 - Bright Beer Tank
The filtered beer is stored in the beer tank pending for the extract brewing and packaging process. - Beer brew
In extract brewing, beer is extracted into different packaging to meet the needs of customers. Keg
beer has 2 liters capacity, 5 liters, 20 liters, 30 liters or 50 liters. Beer is extracted into a cans of
330ml, 500ml. Beer bottles have a capacity of 330ml, 450ml, 500ml, 750ml. Capacity of beer
bottles, beer can depends on the market strategy and consumer tastes of each country.
2.3.3 Quality control
Deployment and successful implementation:
• ISO 9001:2008 Quality Management System (quality management).
• ISO 14001 Quality Management System (environmental management).
• HACCP Quality Management System to control the quality, ensuring the taste, quality, andsafety
of the product when purchased.
• CIP (Cleaning in Place) and COP (Cleaning out of Place) sanitation systems. Quality inspection:
• Microbiological testing in fermentation rooms.
• Chemical testing in a shared laboratory.
• Multiple quality checkpoints in the production process entirely operated by machinery,addressing
any detected errors immediately.
• Checking the cleanliness of bottle shells, identifying defects on bottles, and assessing qualityafter washing. 15 lOMoARcPSD| 36991220
Figure 2. 4: Production of glass bottles Saigon Beer
2.4 Managing inventory flow
2.4.1 Goods characteristics -
Saigon Beer is the main product of Saigon Beer - Alcohol - Beverage Corporation
(SABECO),with two main packaging forms: cans and glass bottles. In this report, the team will
only analyze Saigon Beer products from a packaging perspective, not in-depth analysis of product
designs (green Saigon Beer, red Saigon Beer...) -
Aluminum can: Capacity 330ml. This is a popular form of Saigon Beer product because if
youwant to buy beer to take home or transport it far away, aluminum cans are the most suitable
option. In addition, Saigon Beer's aluminum can design also applies Ergonomics as the height is
not too high, helping drinkers not have to tilt their head too high when drinking, or has a larger
radius than other products other aluminum can products, to fit the hand of male customers (who
are the main customers of Saigon Beer). -
Glass bottle: Capacity 330ml. Saigon Beer has many types of glass bottles with
differentheights, serving many different customer groups, but they all use the same type of tank
for storage. In addition, the glass bottle design also applies Ergonomics in some points. Aluminum cans (barrels) Glass bottles (tanks) Dimensions (cm) 18 x 12 x 24 30 x 25 x 24 16 lOMoARcPSD| 36991220 Number of products/ storage 24 cans 24 bottles units 4 6 The highest number of floors allowed Number of units on each floor 9 6 Total units/pallet 36 36
Table 2. 1: Beer parameters for storage 2.4.2 Warehouse 2.4.2.1 Characteristic
Some warehouse characteristics:
- Built with a large area and in spacious, flat locations, with airy space to help facilitatethe
transportation process as well as improve the efficiency of preserving finished products.
- Warehouses are built in a closed architectural style to store and store raw materials, products
or goods for a certain period of time to protect goods from environmental
impact or loss or wastage deficit...
- Have an effective space suitable for its function, providing a safe and comfortable working
environment for workers with the goal of increasing productivity and control, reducing
operating costs as well as increasing productivity customer service level.
- The company's distribution warehouse in Vietnam is a level 1 distribution warehouse(i.e.
from factory ⇒ warehouse). Products after being produced from the factory are transferred to
this warehouse and further distributed to level 1 agents,... distributed to retail stores (levels
2,3,4,...) and final consumer. 17 lOMoARcPSD| 36991220
Figure 2. 5: SABECO’s warehouse
2.4.2.2 Warehouse location
- Saigon Beer - Alcohol - Beverage Corporation is a long-standing company, with asystem of
factories, warehouses, companies, offices,... stretching from North to South, plus hundreds of
Partners from large to small have created an extremely large logistics network with extremely
strong, seamless links. To analyze the effectiveness of that logistics network, the team will
analyze the warehouse system of Saigon - Cu Chi Brewery, located on the outskirts of Ho Chi Minh City.
- The warehouse is about 20km from the center of Ho Chi Minh City, a large industrial park
with full facilities such as roads, landscapes, electricity and water systems, waste treatment
systems. At the same time, this area has easy access to an abundant unskilled labor force, as
well as being close to a major highway, creating a strong advantage for development.
2.4.3 Types of inventory
2.4.3.1 Definition of inventory
Inventory, or inventory, is a list of materials and products or the materials and products
themselves that are kept in stock by a business. If inventory management is done properly,
it can reduce costs and increase profits for the company. 18 lOMoAR cPSD| 36991220
2.4.3.2 Inventory in Saigon Beer production - Raw material inventory:
These are the raw materials needed for the product creation process, including: • Danish malt • Hops • Yeast • Materials
• High quality bottles, high quality cartons and paper boxes • Processing additives • Devices
These are the main raw materials that the company purchases for use in the production
process. Maintaining an appropriate amount of inventory will bring advantages to the
company in purchasing materials and production activities. In particular, the material
supply department will benefit when it can buy in large quantities and enjoy discounted
prices from suppliers. In addition, when a company predicts that in the future the price of
raw materials will increase or that a certain type of raw material will be scarce, or both,
keeping a large amount of inventory will ensure that the company is always fully supplied
in a timely manner at a stable cost. Semi-finished product inventory (unfinished products):
raw materials are in the production stage but not yet completed (not yet finished products).
- Inventory of semi-finished products:
Semi-finished product inventory includes all items that are currently at a stage (such as
unlabeled products, semi-finished products in transit warehouses between stages).
Semi-finished product inventory is an essential part of the production system. Thanks to
semi-finished product inventory, each stage in the production process will reduce
dependence on each other, causing disruption to other departments. In addition,
semifinished products help to effectively plan production for each stage and minimize costs
arising from production delays or free time.
- Inventory of finished products: 19 lOMoARcPSD| 36991220
It is the final product of the manufacturing process. Finished goods inventory includes
products that have completed the production process and are awaiting consumption. Except
for large-scale equipment, consumer goods and industrial products are mass produced and
stored in warehouses to meet expected future consumption.
2.4.4 Inventory management
Inventory management includes 3 main tasks: - Manage product codes - Manage warehoused goods
- Manage the warehouse delivery process
2.4.4.1 Manage product codes
- Receive new or changed information
• A product's product code may have to be added, changed or canceled.
• Management levels will send information to the warehouse manager.
• The warehouse manager will add, edit or delete.
- Check and compare with the product code in the warehouse
• Warehouse staff need to check and compare the actual status of products in the warehouse. - Update information
• Update product code information on the system
• Include information such as: date of modification, request document with validsignature
as well as the signature of the person who edited.
• To ensure if any unexpected incidents arise.
2.4.4.2 Manage warehoused goods
Warehouse goods management has the following operating procedures:
- Notice of warehouse import plan 20 lOMoAR cPSD| 36991220
• Before each warehousing activity, a plan is made and discussed to find the most optimalwarehousing direction.
- Check and compare actual goods
• Check and compare goods in the warehouse
• After the goods arrive at the warehouse, staff must check all information about the
shipment such as name, code, quantity and quality. As well as the standards specified in
the warehouse management process of materials and goods.
• The purpose of solving problems if there are defective goods from the supplier.
- Complete warehouse import procedures
• Warehouse management staff imports goods into the warehouse
• Then prepare stamped warehouse receipt documents as well as update information into the system.
• This information is transferred to relevant departments such as accounting andproduction for checking and comparison.
2.4.4.3 Manage the warehouse delivery process
For warehousing activities, the operating process is as follows:
- Receive warehouse delivery requests
• Staff will process the validity of the request and then continue processing such as
releasing the warehouse for sale, releasing the warehouse for production, assembling or
releasing the warehouse to move to another place. - Check inventory
• Warehouse staff will check that product code at the warehouse. To know whether the
actual quantity is enough to export or not.
- Prepare delivery notes and invoices
• Staff prepare warehouse receipts and invoices for the company and customers to compare
and handle when problems arise.
- Export warehouse and update information
• Warehouse management staff will update information on the system 21 lOMoARcPSD| 36991220
• Report to relevant parties to proceed with warehouse release
2.4.5 Good characteristics
There are two types of Saigon beer sold in the market: glass bottle beer and canned beer.
Figure 2. 6: Types of products of Saigon beer Aluminum cans (barrels) Glass bottles (tanks) Dimensions (cm) 30 x 25 x 12 30 x 25 x 24 Number of products/ storage 24 cans 24 bottles units 10 6 The highest number of floors allowed Number of units on each floor 6 6 Total units/pallet 60 36
Table 2. 2: Size of the unit of goods
2.4.6 Warehouse of SABECO
- Warehouses are divided into 2 types: • Dry material storage
• Warehouse for storing materials and finished products
- Regarding dry material storage: 22 lOMoARcPSD| 36991220 •
Raw materials are the main materials that a company purchases to use in its production
process.Is where input materials are stored to produce beer (final product). Maintaining the
appropriate amount of raw materials will bring the company convenience in purchasing materials
and production activities. Such as: barley, Houblon flowers, rice, water, yeast •
Because of the nature of the materials, appropriate conditions and space are needed.
Likepulses, flowers, and rice, they need a dry, cool place to avoid mold. As for yeast, the right
temperature is needed so that the yeast does not get damaged.
- About finished product warehouse:
• Saigon Beer's finished product inventory includes products that have completed their production
cycle and are waiting to be shipped for consumption. Except for large-scale equipment, consumer
products and industrial products are mass produced and stored in warehouses to meet expected
future consumption. Specifically: bottles and cans (Hanacans Joint Stock Company, TCB Ball
Vietnam Beverage Can Company Limited...); label (Krones
Company, San Miguel Yamamura Phu Tho...); lid (Hercules VN Co., Ltd., Hanaka Co., Ltd....)
2.5 Transportation system
2.5.1 Overview of Saigon Beer Transportation and Logistics Joint Stock Company (Sabetranjsc)
- Address: 8th Floor, No. 8 Nam Ky Khoi Nghia, Nguyen Thai Binh Ward, District 1, Ho Chi Minh City.
- The predecessor was a fleet of vehicles taken over from BGI Company in 1977 under the Union
of Alcohol - Beer - Beverage Enterprises II. In 2005, the Company was equitized into Saigon
Beer Transportation and Delivery Joint Stock Company.
- Saigon Beer Transportation and Forwarding Joint Stock Company - Sabetranjsc is an
enterprisespecializing in transportation services serving Saigon Alcohol - Beer - Beverage Joint
Stock Corporation, playing an important role in the channel. Distribution and circulation of
goods is a link in Sabeco's system. 23 lOMoARcPSD| 36991220
- Sabeco's transportation system is two-way, from transporting finished goods (beer, wine, soft
drinks...) to transporting materials (cases, beer tanks...) to maximize energy. transportation efficiency and cost savings.
- Currently, road transport accounts for the majority of the proportion in Sabeco's domestic
transport system. In addition, Sabeco also uses a variety of other types of transport such as
waterway and railway for its units. domestic and foreign suppliers.
2.5.2 Transportation system roles -
Transportation facilitates the movement of goods from suppliers to customers, which is
critical in logistics. Several transportation roles help to ensure a smooth logistical operation: -
Freight Transportation: The transportation of goods via various modes such as trucks, trains,
ships, and planes based on factors such as speed, cost, and the nature of the goods. -
Warehousing and Distribution Centers: These facilities serve as hubs for goods storage,
sorting,and distribution, and are frequently linked to transportation networks for easy access. -
Supply Chain Management: Coordination of transportation schedules, route optimization,
and timely delivery while minimizing costs and disruptions. -
Inventory Control: Maintaining stock levels in order to ensure that goods are available when
needed while avoiding overstocking, which affects transportation volume. -
Carrier and Freight Services: Transportation companies such as carriers, freight forwarders,
and brokers.play vital roles in executing logistics plans and ensuring goods reach their destinations. -
Last-Mile Delivery: Finishing the final phase of delivery to the customer's door, which
frequently involves local transportation methods such as vans, bikes, or even walking. -
Technology Integration: Using technology to improve transportation efficiency and
visibility, such as GPS, route optimization software, and real-time tracking. -
Regulatory Compliance: Knowing and following transportation regulations, such as permits,
safety standards, and international trade laws. 24 lOMoARcPSD| 36991220 -
Risk Management: Identifying potential transportation risks (for example, weather,
accidents, and delays) and putting strategies in place to mitigate their impact on logistics
operations. - Customer Service: Providing updates, answering questions, and ensuring a positive
customer experience throughout the transportation process.
Each of these roles is critical to establishing a seamless and efficient transportation system within
logistics, ensuring that goods are delivered reliably, on time, and at a reasonable cost.
2.5.3 Modes of transport
- Saigon beer is used in many forms of transportation: by sea, by air, by train or by road. It also
hires many third-party logistics companies for shipping. In particular, road transport is
considered the most flexible method developed by the road system.
- Shipping by air is the fastest way. However, the cost is also the highest.
- Shipping by sea: can transport large amounts of products at the same time at a lower cost but
also takes more time than other shipping methods.
- Besides, containers can also be used to continue transport by road or train at the customs
clearance location. Saigon Beer is considering choosing the shipping method by sea, including
the cost of loading goods onto the ship, related licenses,...
- Transport by train: economical and effective for transporting goods from one place to another.
Countries with high-speed train systems such as Europe, Japan or China will benefit from this method. 25 lOMoARcPSD| 36991220
Figure 2. 7: Transport SABECO’s beers by truck
2.5.4 Advantages and disadvantages for the Saigon Beer transportation system 2.5.4.1 Advantages
- Vietnam's geographical location is extremely favorable
- More than 3000 km of coastline
- Located at the international maritime intersection
- Favorable terrain to develop strategic ports
- Convenient for sea transportation (low cost, large volume of goods). 2.5.4.2 Disadvantages
- Law: There are quite a few documents, but specific policies detailing those policies have
not been implemented or are overlapping, leading to long immigration processing times.
- Natural environment: On average each year, Vietnam has 10 - 12 storms hitting the
mainland and on average, Coca-Cola's transportation system will be stopped for 1 - 2 weeks. 26 lOMoARcPSD| 36991220
- Infrastructure: The road transport system in some areas is in poor condition.Besides, there
is no North-South expressway. The highway system is being expanded but not much.
Furthermore, the entire South has only 90 km of expressways with a maximum speed of
120 km (the world average is 220 km).
- Warehouse: Vietnam still lacks centralized logistics zones with strategic locations,
synchronized with the system of ports, airports, national highways, and production
facilities; supply and demand imbalance at southern seaports
2.6 Distribution channel
2.6.1 Distribution channel 2.6.1.1 Concept
A distribution channel is a set of interdependent organizations, individuals, vehicles, and
technologies that play a role in the process of getting products or services from the place
of production to the hands of consumers or targeted customer entities.
Individuals and organizations participating in the channel are considered
members. Those members situated between consumers and producers are referred to as distribution intermediaries.
2.6.1.2 The role of the distribution channel For customers:
Ensuring availability: The distribution channel functions to ensure the supply of
products that customers need in a short period and at convenient locations. Customers can
purchase products at grocery stores, supermarkets, distribution points, etc., instead of
having to go to the production site.
Ease of selection and purchase: Customers can easily and conveniently choose
and purchase products through direct information or product display. Additionally, many
distribution points represent the manufacturer to provide technical support, product advice,
helping to save costs and time for customers. For manufacturers: 27 lOMoAR cPSD| 36991220
Market coverage: Manufacturers, with the help of the distribution channel, can
bring their products to various points of sale for consumers in need, effectively covering
the market without spending too much time.
Market understanding: The distribution channel is a tool that manufacturers utilize
to capture the market, understand the needs and purposes of customers regarding the
product, and learn a bit about competitors.
Bridge between production and consumers: The distribution channel is considered
a bridge between manufacturing businesses and consumers. The distribution network
helps bring products from manufacturers to consumers conveniently and quickly.
The entire channel supports manufacturers in effectively caring for customers in
services such as product usage guidance, warranty, maintenance, ordering, shipping, complaint handling, etc.
2.6.1.3 Types of Distribution Channels -
Direct Distribution Channel: This channel involves only two entities, the
manufacturer and the end consumer. The product is directly distributed to the consumer
without intermediaries. The structure of the direct distribution channel is: P (Producer) - > C (Consumer). -
Indirect Distribution Channel: In the indirect distribution channel, there are two
types: traditional distribution channel and modern distribution channel. -
Traditional Distribution Channel: This channel involves multiple stages, with the
product passing through intermediaries before reaching the end consumer.
+ Level 1: P (Manufacturer) -> R (Retailer) -> C (Consumer)
+ Level 2: P (Manufacturer) -> W (Wholesaler) -> R (Retailer) -> C (Consumer)
+ Level 3: P (Manufacturer) -> A&B (Brokers) -> W (Wholesaler) -> R (Retailer) -> C (Consumer) -
Modern Distribution Channel: In this channel, the manufacturer and distribution
intermediaries work together as a unified entity. Products are distributed directly from this
unified entity to the end consumer. The benefit of this channel is cost and time savings in the transportation process. 28 lOMoARcPSD| 36991220 -
Multilevel Distribution Channel (Hybrid): In this distribution channel, entities
other than the manufacturer act as intermediaries or may also be consumers. Implementing
a multilevel distribution channel can have advantages in saving advertising costs, but a
commission must still be paid to the intermediaries.
2.6.2 Members in the Distribution Channel of Saigon Beer -
Manufacturer: The Saigon Alcohol, Beer, and Beverage Corporation, with 26
manufacturing plants, is responsible for supplying products to the members in the distribution channel. -
Distributor: Level 1 Distributor: The first distributor in the distribution channel directly
transacts with the company regarding policies and distribution conditions. They receive goods
directly from the company, possess capital, warehouses, and transportation means. Distributors
must adhere to principles such as ensuring sales volume, providing information to retailers and
end consumers, and offering feedback to the manufacturer. Distributors receive commissions
based on achieved sales targets, with potential reductions for underperformance. • Advantages:
For the Company: Bulk consumption, shared risks, multiple points of contact with end consumers.
For Consumers: Access to wholesale-priced products, assurance of product availability. • Disadvantages:
For the Company: Conflict resolution among distributors can be time-consuming, and negative
distributor attitudes may impact the company's image.
For Consumers: Limited availability for purchasing small quantities. -
Supermarkets: These represent a mixed or specialized distribution channel with
sophisticated and convenient services for customers. Supermarkets, favored by consumers, directly
receive goods from the company and have capital, display areas, warehouses, and transportation means. • Advantages:
For the Company: Direct interaction with end consumers, diverse and abundant store systems.
For Consumers: Ensured product availability, prices not affected by external factors, confidence
in quality, comfortable shopping experience. • Disadvantages: 29 lOMoARcPSD| 36991220
For the Company: Competing with rival products, sales heavily depend on supermarket display strategies.
For Consumers: Prices may be higher compared to small retailers. -
Key Accounts: These are significant consumers of a business, often focusing on large target
groups such as restaurants, hotels, eateries, and bars. Key Accounts receive goods directly from
the company, are monitored but not managed by the company, and have direct interaction with customers. • Advantages:
For the Company: Direct interaction with end consumers, diverse and abundant store systems.
For Consumers: Assured product availability. • Disadvantages:
For the Company: Selling products of competitors, challenging to control the sales volume, cutting
company promotions for additional profit. -
Retailers: Encompassing businesses, organizations, and individuals selling goods to
individual consumers or households, retailers are in direct contact with the end consumer,
understanding their needs and desires better than anyone else. -
End Consumers: Including individual consumers, industrial users, and professional
organizations, end consumers are the ultimate target of the entire commercial system.
2.6.3. Distribution Channel Structure
Currently, SABECO has a network of 26 factories, 10 member trading companies, and a network
of over 100,000 points of sale across the country. SABECO owns multiple beer brands in the
market, such as Bia Saigon Special, Bia Saigon Export, Bia Saigon Lager, Bia Saigon Gold, and Bia 333.
The establishment of 10 joint-stock trading companies in 10 key provinces and cities in the
North, Central, and South regions aims to foster the bond of distributors in distributing SABECO's
products. This strategy focuses on deepening the market, avoiding overlap and competition among
distributors, ensuring SABECO's products reach consumers quickly and conveniently.
The Saigon Alcohol, Beer, and Beverage Corporation is organizing its distribution channel
according to the parent company - subsidiary model to enhance distribution efficiency and save distribution costs. 30 lOMoARcPSD| 36991220 -
Online Channel: Collaborating with e-commerce platforms such as Lazada, Shopee, Tiki,
etc., to make its products available on these online marketplaces. These platforms act as traditional
agents for SABECO, placing orders from SABECO and distributing them to online customers. -
Offline Channel: SABECO utilizes a parallel distribution system, including both a one-tier and a two-tier channel. -
One-tier Channel: SABECO directly distributes Bia Saigon Lager to major consumers, such
as large supermarkets nationwide (Co-op mart, BigC, Vinmart, Metro, Saigon Tourist, etc.) and
small retail chains (Familymart, Circle K, Ministop, Bach Hoa Xanh, etc.). Additionally, this
channel includes Key Accounts (restaurants, bars, hotels, institutions, etc.) with large sales
volumes. This channel is essential for promoting the company's image, introducing products to
consumers, and significantly influencing customer preferences.
Two-tier Channel: This is a strategic sales channel for SABECO. Level 1 distributors directly
receive goods from Saigon Beer Trading Co., Ltd., and distribute them to level 2 distributors.
Recommendations for Channel Improvement: + For the Company:
Develop a unified distribution strategy for the entire distribution channel system, providing
specific regulations for each member to create a strong and cohesive distribution system.
Offer special assistance in training human resources and sales capabilities for new distributors.
Strengthen cooperation with tourism companies to increase the company's visibility.
Increase advertising activities to promote the brand and the company's image, enhancing
competitiveness against competitors. + For Distributors:
Adhere to contract regulations, avoid territorial encroachment, price manipulation, and refrain
from dealing with low-quality products.
Establish close ties with other channel members with a spirit of mutual development, minimizing conflicts.
2.6.4 Distribution Channel Design Process
Step 1: Implementing General Strategy
• Regularly analyze and evaluate the distribution results of focused distributors, identifying conflicts within the channel: 31 lOMoAR cPSD| 36991220
• Vertical conflicts: between focused distributors and Saigon Beer Manufacturing Company
regarding discount payment issues.
Horizontal conflicts: among focused distributors competing for market share, retail spaces, and against competitors.
Step 2: Analyzing Influencing Variables
• Analyze variables that influence distribution decisions:
• Characteristics of target customers/market. • Market geography. • Product characteristics. • Company characteristics.
Step 3: Determining Distribution Objectives
• Batch size: 1 pallet (48 cases of bottles or 120 cases of cans) per order with a lead time of 1 day.
• Optimal location: Distributors located in the center of the customer circle to minimize the
distance from distributors to customers.
Step 4: Identifying Channel Structure and Selecting Optimal Channels
• Three-tier channel: Distributing Saigon Beer to all supermarkets, wholesalers, then
supplying to locations such as restaurants, eateries, convenience stores, and finally reaching end consumers.
Step 5: Classifying Distribution Functions Beer Saigon:
+ Store goods, ensure order fulfillment for level 1 intermediaries.
+ Execute transportation to level 1 intermediaries.
+ Provide support services for intermediaries.
• Exclusive distribution agent: + Store and preserve goods.
+ Arrange and classify goods according to customer needs (retailers).
+ Place orders and receive orders.
+ Collect market information and transfer it to Saigon Beer.
+ Sales: seek customers, sell products, provide services to customers (exchange near-expiry
products, display products according to company regulations at retail stores, etc.).
• Other level 1 intermediaries:
+ Provide sales points, sales staff. 32 lOMoARcPSD| 36991220
+ Display products and promotional activities at the point of sale.
+ Distribute appropriate quantities of goods according to consumer demand.
+ Sell products to end consumers.
2.6.5 Distribution Channel Management
Managing distribution channels is always a challenge for businesses. An efficient system not only
ensures tight management processes and widespread, timely service but also serves as a way to
quickly reach consumers to gain a competitive advantage in the market. Thanks to the application
of information technology, SABECO has effectively managed its product distribution channels.
To effectively manage the distribution channels in the Saigon Beer market, exploring the use of
modern information technology applications is essential. Examples include the Oracle E Business
Suite 11i integrated information management program, Enterprise Resource Planning (ERP)
systems, and Customer Relationship Management (SAP) solutions. These technologies can
enhance the efficiency of distribution channel management for Saigon Beer, ensuring precise
control and timely service delivery.
2.6.6 Distribution Channel flows 33 lOMoARcPSD| 36991220
Figure 2. 8: Flow in distribution channels
Retailers in the distribution channel will directly place orders with wholesalers, and these
wholesalers will then place orders with Saigon Beer Trading Company based on the region,
depending on the quantity of orders and the current inventory levels.
For one-tier channels such as supermarkets and Key Accounts, they will place orders directly with
the company without going through any intermediaries. - Information Flow:
Information is smoothly and continuously transmitted among channel members. The company
provides information about product categories, weight, size, prices, payment terms, discounts, etc.,
to distribution intermediaries and end consumers. The company also receives feedback from other
channel members to leverage, improve, and address weaknesses in the system.
Furthermore, the information flow helps SABECO effectively monitor the activities of
distributors. Distribution-related information is held by the Sales Support department, then
reported to the Consumption-Market-Brand Board for processing and resolving issues to
contribute to better market development and profitability for the company.
- Material Flow and Packaging Retrieval:
In the material flow and packaging retrieval process, the role of the transportation company is
particularly crucial. It is known that the company specializing in transportation for SABECO is
Saigon Beer Transportation and Delivery Joint Stock Company (Sabetranjsc). For products such
as wine, beer, and soft drinks, the company transports using trucks and containers based on the
payload and terrain of the region.
The packaging retrieval process runs counter to the material flow, moving from end consumers
back to the manufacturer. SABECO endeavors to thoroughly retrieve cans, bottles, and beer crates
for reuse, minimizing costs and contributing to environmental protection.
- Ownership Transfer Flow:
The ownership transfer flow runs parallel to the material flow; as products are transferred to
channel members, ownership is also transferred to them. - Payment Flow:
For wholesalers, supermarkets, and key accounts, payments are typically made through bank
transfers. For small retailers or end consumers, they make direct cash payments. 34 lOMoARcPSD| 36991220 - Negotiation Flow:
Through contracts, SABECO negotiates with distributors to sell products at agreed-upon prices
and implement all promotional programs in line with the company's objectives.
2.6.7 Saigon Beer distribution channel system 2.6.7.1 Domestic
According to statistics, by the end of 2020, Saigon Alcohol - Beer - Beverage
Corporation had 10 regional trading companies, 26 subsidiaries, present throughout
Vietnam with 600,000 people + point of sale.
SABECO's market share in 2018 and 2019 accounted for the largest proportion,
but look tend to decrease due to increasingly fierce competition from competitors. Faced with this
difficult situation and the negative effects of the Covid-19 pandemic on the beer industry,
SABECO is required to have timely strategies to ensure sustainable
development and increase the competitiveness of the beer industry enterprise. 2.6.7.2 Foreign
Saigon Beer is popular with customers around the world and has been exported to 38 countries:
- Europe: France, Netherlands, England, Sweden, Switzerland, Russia, Denmark, Spain,
Czech Republic, Austria, Italy, Germany, Romania
- Asia: Laos, China, Taiwan, Japan, Hong Kong, Korea, Thailand, Singapore, Bahrain, Israel
- Americas: United States, Canada, Panama
- Oceania: Australia, New Zealand, Kiribati
- Africa: Equatorial Guinea, Gabon, Cameroon, Ghana, Republic of Congo, Benin, Liberia and Sierra Leone
2.6.7.3 Functions of the distribution channel system 35 lOMoAR cPSD| 36991220
Distribution channel members perform many important functions including:
- Information function: collect and distribute information about actors and forces in the
distribution system, supporting the company in making strategic decisions.
- Promotion function: deploy and distribute programs to bring the company's image to
customers, enhance the company's brand
- Contact function: plays an important role in learning about and introducing the company's products to the market
- Negotiation function: to agree on a reasonable price so that the sale goes well-
Transportation and storage functions: ensure stability in providing products to customers
- Funding assurance function: finding and using capital sources to offset distribution costs-
Risk function: accept risks in your business.
2.6.7.4 The role of the distribution channel system PRODUCTION ➡ DISTRIBUTION ➡ CONSUMERS
- Distribution of goods and products is a part of production relations, a link between
themproduction and consumption. The distribution system plays an important role in the
process of providing customers with the right products, at the right time, in the right
location, so distribution channels directly affect the success or failure of businesses in
general and for SABECO in particular.
- The distribution system helps adjust the supply and demand of goods and services,
helping businesses focus on specializing in their production activities. Thanks to the
distribution network, businesses can overcome time constraints and increase the ability
to choose goods for customers. Philip Kotler (2008) proposed three basic roles of
distribution channels as follows: increasing transaction efficiency; increase product
supply efficiency; satisfy customers' needs and types of goods. 36 lOMoARcPSD| 36991220
CHAPTER 3: PROBLEM AND SOLUTION
3.1. Problems in Distribution Network
3.1.1. Imbalanced Distribution Market
Saigon Beer Corporation encounters challenges in accessing and effectively operating within
the rural market, particularly in deep rural regions, remote areas, and island districts. This situation
indicates an imbalanced distribution market, where there is a disparity or unevenness in the
availability and accessibility of products and services. Solution:
- Establish Regional Distribution Centers: Set up regional distribution centers strategically
located in or near rural areas. These centers can act as hubs for storing and distributing products to
the surrounding regions. By having distribution centers closer to the target market, transportation
costs and delivery times can be reduced.
- Develop Last-Mile Delivery Solutions: Invest in last-mile delivery solutions tailored for rural
areas. This may involve utilizing smaller vehicles, motorbikes, or bicycles to navigate through
narrow roads and reach remote locations. Additionally, consider partnering with local logistics
providers who have expertise in navigating the specific terrain and infrastructure challenges of rural regions.
- Collaborate with Local Retailers: Build partnerships with local retailers, including small
grocery stores, convenience shops, and village cooperatives, to expand the reach of Saigon Beer
Company's products. These retailers have a better understanding of the local market and can serve
as distribution points in rural areas. Provide incentives and support to encourage their participation
in promoting and selling the company's products.
- Utilize Mobile Sales and Sampling: Deploy mobile sales and sampling teams to visit rural
areas, setting up temporary stalls or vehicles to showcase and sell Saigon Beer Company's
products. This approach can help generate awareness, trial, and ultimately drive sales in remote
regions where traditional retail infrastructure may be limited.
- Leverage Digital Platforms: Utilize digital platforms, such as e-commerce websites and
mobile apps, to enable online ordering and delivery of products in rural areas. Partner with existing
e-commerce platforms that have a presence in rural markets or establish a dedicated online
platform to facilitate direct sales to consumers. 37 lOMoARcPSD| 36991220
- Conduct Rural Marketing Campaigns: Develop targeted marketing campaigns specifically
tailored to the rural market. This can include localized advertising, sponsorships of local events,
and engagement with rural communities through social media platforms. Focus on highlighting
the unique value propositions of Saigon Beer Company's products that resonate with rural consumers.
- Provide Training and Support: Offer training programs and support to distributors, retailers,
and sales teams operating in rural areas. This can include product knowledge training, sales and
marketing techniques, and guidance on effective merchandising and display practices. By
empowering local stakeholders, the distribution and promotion of Saigon Beer Company's products can be improved.
- Monitor and Evaluate Performance: Implement a system to monitor and evaluate the
performance of the distribution process in rural areas. Regularly assess key performance indicators
such as sales volume, market share, and customer satisfaction to identify areas for improvement
and make necessary adjustments to the distribution strategy.
3.1.2. Inaccurate Order Fulfillment
Saigon Beer Company faces challenges in accurately processing and fulfilling customer orders.
This can result in incorrect or incomplete products being delivered to customers, leading to
customer dissatisfaction and potential financial losses for the company. Solution:
- Implement an automated order processing system: Invest in an automated order processing
system that minimizes manual intervention. This system should have features such as automated
order entry, real-time inventory tracking, and automated picking and packing processes. By
reducing manual errors, the system can improve order accuracy.
- Enhance inventory management: Implement an efficient inventory management system that
provides real-time visibility into stock levels. This system should integrate with the order
processing system to ensure accurate fulfillment based on available inventory. Regular stock audits
and cycle counts can help identify and rectify any discrepancies.
- Improve communication channels: Establish clear and effective communication channels
between different departments involved in the order fulfillment process, such as sales, warehouse,
and logistics teams. Regularly communicate order requirements and any updates or changes to ensure accurate fulfillment. 38 lOMoARcPSD| 36991220
- Standardize packaging and labeling processes: Develop standardized packaging and
labeling procedures to ensure consistency and accuracy. Clearly define packaging requirements
and labeling instructions to avoid confusion during the fulfillment process. Conduct regular quality
checks to ensure packaging and labeling accuracy.
- Implement quality control measures: Introduce quality control measures throughout the
order fulfillment process, including random checks of packed orders before shipping. This can help
identify and rectify errors before products are dispatched to customers.
- Provide training and support: Train employees involved in the order fulfillment process on
proper procedures, accuracy requirements, and the importance of attention to detail. Offer regular
refresher training sessions and provide ongoing support to address any challenges or questions that may arise.
- Customer feedback and resolution: Establish a mechanism to collect customer feedback on
order accuracy. Actively address any issues or complaints related to inaccurate order fulfillment
promptly and provide appropriate resolutions to ensure customer satisfaction.
3.1.3. Exchange and Return
Saigon Beer Company lacks appropriate regulations and has not satisfactorily addressed cases
where customers purchase faulty products. It will also lead to customer dissatisfaction and
potential financial losses for the company. Solution:
- Clear and customer-friendly policies: Develop clear and easily understandable exchange and
return policies that are prominently communicated to customers. Ensure that the policies include
information on acceptable reasons for exchanges or returns, timelines, and any specific
requirements or conditions. Make these policies accessible through the company's website,
customer service channels, and product packaging.
- Streamlined exchange and return processes: Establish well-defined and efficient procedures
for processing exchanges and returns. This includes providing clear instructions to customers on
how to initiate the process, specifying required documentation (such as proof of purchase), and
designating dedicated staff or departments responsible for handling exchanges and returns.
Streamlining the process will help minimize delays and errors.
- Training and empowerment of customer service staff: Provide comprehensive training to
customer service representatives to handle exchanges and returns effectively. Equip them with the 39 lOMoARcPSD| 36991220
necessary knowledge and tools to address customer concerns promptly and professionally.
Empower customer service staff to make decisions within the established policies to resolve customer issues efficiently.
- Simplified return logistics: Design a straightforward and convenient return process for
customers. This can involve providing prepaid return labels or arranging for product pickups from
customers' locations. Simplifying the logistics will make it easier for customers to return products,
thereby improving their overall experience.
- Continuous feedback analysis: Regularly analyze customer feedback related to exchanges
and returns to identify recurring issues, patterns, or areas for improvement. Actively listen to
customer concerns and use their feedback to refine policies and processes to better address their needs.
- Quality control and product improvement: Implement stringent quality control measures to
minimize the occurrence of product issues that lead to exchanges and returns. Continuously
monitor and evaluate product quality, and address any recurring issues promptly. This proactive
approach will help reduce the need for exchanges and returns in the first place.
3.2. Problems in Inventory Management
3.2.1. Inefficient product storage managing
Managing the storage of products by distributors presents many challenges. It leading to
several negative consequences and impacts on various aspects of the distribution network. Solution:
- Optimize Warehouse Layout: Evaluate and optimize the layout of the warehouse to maximize
space utilization and streamline product flow. This includes organizing products in logical
categories, creating clear aisles, and utilizing efficient shelving systems.
- Implement Inventory Tracking Systems: Adopt inventory management systems or software
that provide real-time visibility and accurate tracking of inventory. This enables distributors to
monitor stock levels, track product movement, and identify potential issues promptly.
- Enhance Product Labeling and Categorization: Implement clear labeling and
categorization systems to facilitate easy identification and retrieval of products. Utilize barcode or
RFID technology to streamline inventory tracking and reduce errors. 40 lOMoARcPSD| 36991220
- Establish Stock Rotation Procedures: Develop and enforce stock rotation procedures, such
as the First-In, First-Out (FIFO) method, to ensure older products are used or sold before newer
ones. Regularly review inventory to identify slow-moving or obsolete items and take appropriate actions.
- Improve Storage Conditions: Assess and improve storage conditions to protect products from
damage or deterioration. This may involve implementing proper temperature and humidity
controls, investing in appropriate packaging materials, or implementing security measures to prevent theft.
- Regular Audits and Continuous Improvement: Conduct regular audits of the storage area to
identify inefficiencies and areas for improvement. Seek feedback from warehouse staff and
stakeholders to implement continuous improvement measures and optimize storage practices.
3.2.2. Excessive or Insufficient Inventory
Maintaining excessive inventory ties up valuable capital and storage space, increases carrying
costs, and can lead to obsolescence or spoilage. On the other hand, insufficient inventory can result
in stockouts, missed sales opportunities, and dissatisfied customers. Solution:
- Optimize Demand Forecasting: Improve demand forecasting accuracy through the use of
data analysis, historical sales data, market trends, and customer insights. This helps to align
inventory levels with expected demand, reducing the risk of both excess and insufficient inventory.
- Implement Just-in-Time (JIT) Inventory Management: Adopt JIT principles to minimize
inventory levels while ensuring that products are available when needed. JIT allows for
streamlined inventory replenishment based on actual demand, reducing the risk of excess inventory and associated costs.
- Set Reorder Points and Safety Stock Levels: Determine optimal reorder points and safety
stock levels for each product based on lead times, demand variability, and desired service levels.
This helps to prevent stockouts while avoiding excessive inventory accumulation.
- Establish Effective Supplier Relationships: Collaborate closely with suppliers to improve
visibility and communication. Implement vendor-managed inventory (VMI) or consignment
programs where appropriate, allowing suppliers to monitor and manage inventory levels on behalf of the distributor. 41 lOMoAR cPSD| 36991220
- Utilize Inventory Management Systems: Implement inventory management software or
systems that provide real-time visibility into inventory levels, sales data, and demand patterns.
This enables better decision-making and inventory control, reducing the risk of excessive or insufficient inventory. 42 lOMoARcPSD| 36991220 -
Implement ABC Analysis and SKU Rationalization: Conduct an ABC analysis to categorize
products based on their value and contribution to sales. Focus on optimizing inventory
management for high-value products while considering SKU rationalization for slow-moving or low-demand items.
- Enhance Communication and Collaboration: Improve communication and collaboration
between different departments involved in inventory management, such as sales, marketing,
operations, and finance. This ensures better alignment between inventory levels and anticipated demand.
- Continuous Monitoring and Optimization: Regularly monitor inventory levels, sales data,
and market trends to identify patterns and potential issues. Conduct regular inventory audits to
identify slow-moving or obsolete items, and take proactive steps to optimize inventory levels and minimize risks.
- Streamline Order Fulfillment Processes: Streamline and automate order fulfillment
processes to improve efficiency and reduce lead times. This includes optimizing picking, packing,
and shipping processes to ensure accurate and timely order fulfillment.
- Regular Performance Evaluation: Continuously evaluate the effectiveness of inventory
management strategies through key performance indicators (KPIs) such as inventory turnover
ratio, stockouts rate, and carrying costs. Use this data to identify areas for improvement and
implement necessary adjustments.
3.3. Problems in Transportation Process
3.3.1. Compliance and Regulatory Issues
The policies regarding port entry and clearance are not clear despite the existence of numerous
documents addressing this issue, resulting in prolonged port entry and clearance times, which
impact contracts, economy, and quality. Solution: 43 lOMoAR cPSD| 36991220 -
- Policy Review and Standardization: Conduct a comprehensive review of existing policies
and regulations related to port entry and clearance. Identify areas of ambiguity or inconsistency
and work towards standardizing and clarifying these policies.
Stakeholder Collaboration: Engage with relevant stakeholders, including port authorities,
customs agencies, shipping lines, and industry associations, to gather input and insights on the
challenges and areas of improvement. Foster collaboration to streamline processes and ensure clarity in policies.
- Publish Clear Guidelines and Procedures: Develop clear and concise guidelines and
procedures regarding port entry and clearance. These documents should outline the necessary
steps, required documentation, and compliance requirements for smooth and efficient processes.
- Training and Awareness Programs: Conduct training programs and workshops to educate
stakeholders, including importers, exporters, freight forwarders, and customs brokers, about the
policies and procedures related to port entry and clearance. Enhance awareness and understanding
of compliance requirements to avoid delays and non-compliance issues.
- Communication Channels: Establish effective communication channels for disseminating
information and updates regarding port entry and clearance policies. Utilize websites, newsletters,
email notifications, and online portals to provide timely information to stakeholders.
- Dedicated Helpdesk or Support: Set up a dedicated helpdesk or support team to address
queries and provide guidance on port entry and clearance processes. This helps stakeholders
navigate through the policies and procedures and resolve any issues they may encounter.
- Regular Policy Updates: Maintain an ongoing review process for port entry and clearance
policies to ensure they remain up to date with changing regulations and industry requirements.
Communicate any updates or changes promptly to stakeholders to avoid confusion and noncompliance.
- Collaboration with International Standards: Align port entry and clearance policies with
international standards and best practices to facilitate smoother trade operations and reduce barriers to global trade. 44 lOMoARcPSD| 36991220 -
- Performance Monitoring and Evaluation: Implement a system to monitor and evaluate the
performance of port entry and clearance processes. Track key performance indicators (KPIs) such
as average clearance times, compliance rates, and customer satisfaction to identify areas for
improvement and measure progress.
Continuous Improvement: Foster a culture of continuous improvement and feedback loops
to address any issues or challenges that arise in the port entry and clearance processes. Encourage
stakeholders to provide feedback and suggestions for enhancing the efficiency and clarity of the policies.
3.3.2. Insufficient Transportation Infrastructure System
The transportation infrastructure system has severely deteriorated or has not been fully utilized
on a large scale, resulting in various difficulties in the transportation process such as prolonged
transit times or increased transportation costs. Solution:
- Collaboration with Government and Authorities: Engage in proactive collaboration with
government agencies and transportation authorities to address the issues related to insufficient
transportation infrastructure. Advocate for infrastructure development projects and provide input
on the specific needs of the logistics industry.
- Infrastructure Investment: Explore opportunities to invest in transportation infrastructure or
support infrastructure development initiatives. Collaborate with public or private entities to improve
road networks, expand ports or terminals, and enhance transportation connectivity in regions critical
for the company's logistics operations.
- Strategic Warehouse Placement: Optimize the placement of warehouses and distribution
centers considering the existing transportation infrastructure limitations. Locate facilities closer to
major transportation hubs or areas with better connectivity to minimize transit times and transportation costs.
- Modal Shift and Intermodal Transportation: Explore modal shift options to leverage
different transportation modes and overcome infrastructure limitations. Utilize intermodal 45 lOMoAR cPSD| 36991220 -
transportation, combining multiple modes such as road, rail, and waterways, to optimize logistics
operations and mitigate the impact of insufficient infrastructure on transit times and costs.
- Route Optimization: Implement advanced route optimization tools and technologies to
identify the most efficient and reliable transportation routes given the existing infrastructure
constraints. Continuously monitor and update routes based on real-time data to minimize delays and transportation costs. 46 lOMoARcPSD| 36991220
- Collaboration with Logistics Providers: Collaborate closely with logistics service
providers that have expertise in navigating challenging transportation infrastructures. Leverage
their knowledge and experience to identify alternative routes, optimize transportation processes,
and reduce the impact of infrastructure limitations on logistics operations.
- Data-Driven Decision Making: Utilize data analytics and predictive modeling to make
informed decisions regarding logistics operations. Analyze historical data, traffic patterns, and
infrastructure constraints to optimize transportation planning, scheduling, and resource allocation.
- Supply Chain Visibility and Transparency: Implement supply chain visibility solutions to
track and monitor the movement of goods throughout the transportation process. This helps
identify bottlenecks, anticipate delays, and proactively address issues arising from insufficient
transportation infrastructure.
- Continuous Improvement and Innovation: Foster a culture of continuous improvement and
innovation within the logistics operations of Saigon Beer Company. Encourage employees to
identify opportunities for process optimization, explore new technologies, and implement
innovative solutions to mitigate the impact of insufficient infrastructure.
- Public-Private Partnerships: Explore opportunities for public-private partnerships to
jointly invest in and improve transportation infrastructure. Collaborate with local authorities,
industry associations, and other stakeholders to advocate for infrastructure development projects
that benefit the logistics industry as a whole.
3.3.3. Abnormal Weather Conditions
In Vietnam, there are typically 10 to 12 landfalling typhoons annually. During this period, the
road and waterway systems, especially in the Central region, often experience disruptions and
closures for an average of 1 to 2 weeks. It also prolongs transit times and increases transportation costs. Solution:
- Emergency Preparedness: Develop a comprehensive emergency preparedness plan
specifically tailored to address the challenges posed by abnormal weather conditions. This plan 47 lOMoAR cPSD| 36991220
should include protocols for assessing risks, implementing contingency measures, and
coordinating with logistics partners to ensure minimal disruptions to the supply chain.
- Alternative Transportation Modes: Explore alternative transportation modes that are less
susceptible to disruptions caused by typhoons. This may include utilizing air freight or inland
waterway transportation for the delivery of raw materials and finished products during periods
when road and waterway systems are affected.
- Diversification of Suppliers: Identify and establish relationships with multiple suppliers
located in different regions, both within and outside Vietnam. This diversification reduces
dependence on a single supplier and allows for quicker recovery in the event of disruptions caused by typhoons.
- Real-Time Monitoring and Tracking: Implement real-time monitoring and tracking
systems to closely monitor the movement of goods along the supply chain. This enables Saigon
Beer Company to proactively identify disruptions and adjust logistics operations accordingly.
- Safety Stock and Warehousing: Maintain safety stock levels of raw materials and finished
products to buffer against potential disruptions and delays caused by typhoons. Additionally,
consider establishing strategically located warehouses in different regions to store excess
inventory and ensure availability during transportation disruptions.
- Route Optimization: Continuously review and optimize transportation routes to minimize
exposure to areas prone to typhoon-related disruptions. Use advanced route planning and
optimization tools to identify the most efficient and resilient routes for product distribution.
- Communication and Information Sharing: Establish effective communication channels
with logistics partners, suppliers, and distributors to share timely information about disruptions
and recovery efforts. This facilitates collaborative decision-making and allows for proactive
measures to address logistical challenges.
- Training and Capacity Building: Provide training and capacity-building programs for
logistics staff to enhance their understanding of the challenges posed by abnormal weather
conditions. Equip them with the necessary skills and knowledge to effectively manage logistics
operations during and after typhoon events. 48 lOMoARcPSD| 36991220
- Continuous Improvement: Regularly evaluate logistics performance, gather feedback from
stakeholders, and identify areas for improvement. Implement continuous improvement initiatives
to enhance the resilience and efficiency of logistics processes, taking into account lessons learned from past typhoon events.
3.3.4. Inefficient Transportation Process
Saigon Beer Corporation currently has 26 breweries, 10 subsidiary trading companies, and a
network of over 200,000 retail outlets nationwide. The persistent issue in the transportation process
of the company: The transportation process has not been standardized, resembling a complex
matrix with numerous truck routes, distribution points, and warehouses. Solution:
- Standardization and Process Optimization: Conduct a comprehensive review of the
transportation process within Saigon Beer Company. Identify areas of inefficiency, bottlenecks,
and inconsistencies. Develop standardized procedures, guidelines, and best practices to streamline
and optimize the transportation process.
- Centralized Transportation Management: Establish a centralized transportation
management system or department to oversee and coordinate all transportation activities across
the company's network. This centralization allows for better control, visibility, and coordination
of truck routes, distribution points, and warehouses.
- Route Planning and Optimization: Implement advanced route planning and optimization
tools to optimize truck routes based on factors such as distance, traffic conditions, and delivery
schedules. This helps to minimize transit times, reduce fuel consumption, and improve overall
efficiency in the transportation process.
- Warehouse Management System (WMS): Implement a robust warehouse management
system to optimize warehouse operations, inventory management, and order fulfillment. This
includes features such as real-time inventory tracking, automated picking and packing, and
efficient loading and unloading processes.
- Collaboration with Logistics Partners: Collaborate closely with logistics service
providers, including trucking companies and distribution partners, to streamline operations and 49 lOMoARcPSD| 36991220
improve efficiency. Establish clear communication channels, share data and information, and align
processes and goals to ensure smooth coordination in the transportation process.
- Technology Integration: Leverage technology solutions such as GPS tracking, telematics,
and IoT (Internet of Things) devices to monitor and track the movement of goods in real-time.
This provides better visibility and enables proactive management of transportation activities.
- Performance Monitoring and KPIs: Define key performance indicators (KPIs) to measure
and monitor the performance of the transportation process. Regularly review and analyze these
metrics to identify areas for improvement and implement corrective actions as needed.
- Continuous Improvement Culture: Foster a culture of continuous improvement within the
logistics operations of Saigon Beer Company. Encourage employees to contribute ideas, provide
feedback, and participate in process improvement initiatives to enhance the efficiency of the transportation process.
- Employee Training and Development: Provide training programs and development
opportunities for employees involved in the transportation process. This includes training on best
practices, use of technology tools, and fostering skills in logistics management and optimization.
- Data Analytics and Insights: Utilize data analytics tools to analyze transportation data and
derive actionable insights. This helps in identifying trends, inefficiencies, and areas for
improvement in the transportation process, enabling data-driven decision-making.
3.3.5. Loss of Goods during Transportation
Loss or damage of raw materials and finished products during the transportation process is inevitable. Solution:
- Robust Packaging and Secure Loading: Ensure that goods are properly packaged and
secured to minimize the risk of damage during transportation. Use appropriate packaging
materials, such as protective padding, shrink wrap, or pallets, to safeguard the goods. Train loading
personnel on proper loading techniques to prevent shifting or damage during transit.
- Quality Control Checks: Implement rigorous quality control checks at various stages of the
transportation process. Inspect goods before loading them onto trucks, and conduct periodic checks 50 lOMoAR cPSD| 36991220
during transit to identify any signs of damage or potential issues. This allows for early detection
and timely corrective actions.
- Tracking and Monitoring Systems: Utilize tracking and monitoring systems, such as GPS
or RFID technology, to have real-time visibility of the goods during transportation. This enables
proactive tracking, monitoring, and intervention in case of any deviations or incidents that may lead to loss or damage.
- Insurance Coverage: Obtain appropriate insurance coverage for goods in transit to mitigate
the financial impact of any loss or damage. Work with insurance providers to understand the
coverage options available and ensure that the policies adequately cover the value of the goods being transported.
- Vendor and Carrier Selection: Conduct thorough due diligence when selecting vendors
and carriers for transportation services. Evaluate their track record, reliability, and commitment to
safety and security. Choose reputable and experienced partners who prioritize the safe handling and delivery of goods.
- Training and Education: Provide training and education programs for employees involved
in the transportation process. Train them on proper handling techniques, loading and unloading
procedures, and best practices for ensuring the integrity and safety of goods during transit.
- Route Planning and Risk Assessment: Conduct route planning and risk assessments to
identify potential hazards or high-risk areas along transportation routes. Take necessary
precautions to minimize the exposure of goods to risks such as accidents, theft, or adverse weather conditions.
- Incident Response and Recovery Plan: Develop an incident response and recovery plan to
address any unforeseen events or incidents that may result in the loss or damage of goods during
transportation. This includes having clear protocols and procedures in place to mitigate the impact,
initiate investigations, and implement corrective actions.
- Continuous Improvement Practices: Foster a culture of continuous improvement within
the logistics operations of Saigon Beer Company. Encourage employees to provide feedback, share 51 lOMoARcPSD| 36991220
lessons learned, and contribute ideas for enhancing the safety and security of goods during transportation.
3.3.6. Fluctuate Transportation Costs
In an open economy, the demand for transportation of goods constantly fluctuates across
different periods. The demand can significantly increase during peak seasons such as holidays and
festivals, which has a substantial impact on the transportation costs of various types of goods,
including Saigon beer, a product with high demand in the Vietnamese market. Moreover, during
peak periods like the Lunar New Year, transportation costs tend to escalate, thereby affecting the
product's pricing. Therefore, finding ways to mitigate the impact of these periods during the
transportation process is a challenging task that Saigon Beer Company needs to address. Solution:
- Market Analysis and Forecasting: Conduct regular market analysis and forecasting to
understand the trends and factors influencing transportation costs. Stay informed about changes in
fuel prices, labor costs, regulatory policies, and market demand that can impact transportation
costs. Use this information to anticipate fluctuations and make informed decisions.
- Contract Negotiation: Establish long-term contracts or partnerships with transportation
service providers to secure stable rates and mitigate the impact of cost fluctuations. Negotiate
favorable terms, including fixed rates or rate adjustment mechanisms tied to specific cost indices, to ensure cost stability.
- Strategic Sourcing: Explore multiple transportation service providers and compare their
pricing structures, services, and reliability. Consider leveraging a mix of transportation modes,
such as road, rail, or sea, to optimize costs based on specific requirements and market conditions.
- Route Optimization: Optimize transportation routes to minimize distance, fuel
consumption, and overall transportation costs. Utilize route planning software or work with
logistics experts to identify the most efficient routes that balance cost and delivery timelines.
- Consolidation and Collaboration: Explore opportunities for consolidating shipments or
collaborating with other companies to share transportation costs. Consolidated shipments can
result in better negotiation power with carriers and reduce transportation expenses. 52 lOMoARcPSD| 36991220
- Performance Monitoring and Carrier Evaluation: Regularly monitor the performance of
transportation service providers to ensure they are delivering services in line with agreed-upon
rates and service levels. Evaluate carrier performance based on cost-effectiveness, reliability, and customer satisfaction.
- Continuous Cost Analysis: Implement a system for ongoing cost analysis and tracking of
transportation expenses. Identify cost drivers, analyze spending patterns, and identify areas for
cost reduction or optimization. This data-driven approach helps in proactively managing transportation costs.
- Fuel Efficiency Initiatives: Implement fuel-saving initiatives such as optimizing vehicle
loading, maintaining proper tire pressure, and promoting eco-driving practices. These initiatives
can help reduce fuel consumption and lower transportation costs.
- Collaboration with Industry Associations: Engage with industry associations or trade
organizations that focus on transportation and logistics. Stay updated on industry trends,
participate in discussions on cost management strategies, and network with peers to share insights and best practices.
- Continuous Improvement and Negotiation: Continuously seek opportunities for
improvement and cost optimization within the transportation process. Regularly review contracts,
negotiate rates, and explore innovative solutions or technologies that can lower transportation costs
without compromising service quality. 53 lOMoARcPSD| 36991220
Figure 3. 1: Sales result over the years since 2018 and plan for 2023 of SABECO CHAPTER 4: CONCLUSION
In the current trend of deep integration into the world economy, the right strategy plays a
decisive role in the development and growth of businesses. With persistent and stable development
efforts, constantly improving quality, diversifying products to satisfy consumer expectations,
currently - Saigon Beer is occupying the leading position in the Beer industry. VN and was honored 54 lOMoARcPSD| 36991220
to be recognized as a National Brand 5 times in a row. Saigon Beer is also proud to become the
351st member at the Berlin Beer Academy - one of the cradles of global beer culture. Members in
the chain, each unit has its own role. Although it is "separate", it is extremely unified and tight,
creating the success of the entire supply chain. However, there are still limitations of the supply
chain that have not been noticed. SABECO's supply chain has achieved certain successes, thanks
to the close systematic connection of parts in the chain. Therefore, it is necessary to make the most
of it to improve the efficiency of the Company's supply chain management. From the above
analysis, Vietnamese beverage companies need to draw lessons for themselves to be able to
develop stronger. With the unremitting efforts of each member of the supply chain, in the future
SABECO will certainly grow stronger. REFERENCES 1) https://www.sabeco.com.vn
2)https://dantri.com.vn/kinh-doanh/cong-thuc-thanh-cong-cua-thuong-hieu-bia-144-nam-tuoi- 55 lOMoAR cPSD| 36991220
20190919145525588.htm 3)https://www.studocu.com/vn/document/truong-dai-hoc-lao-dong-xa-
hoi-co-so-2/kinh-te-vimo/bullwhip-sabeco-chia/26557610
4)https://www.sabeco.com.vn/Data/Sites/1/media/co%20dong/bao%20cao%20thuong%20nien/ 20-04-2021/2020AR%20-%20VN.pd
5) http://biasaigonbaclieu.com/cong-nghe/san-xuat-bia/quy-trinh-san-xuat-bia.aspx
6) https://vipanco.com/tim-hieu-quy-trinh-san-xuat-bia-sai-gon-chat-luong/#xay-gao
7)https://vietstock.vn/2023/04/dhdcd-sabeco-ke-hoach-ky-luc-thau-tom-sabibeco-va-thay- ceo737-1065206.htm
8)https://cafef.vn/sabeco-duoc-vinh-danh-doanh-nghiep-tieu-bieu-vi-nguoi-lao-dong- 188231031164723942.chn 9)
https://thoibaotaichinhvietnam.vn/tiet-giam-gia-thanh-dau-vao-loi-nhuan-sabeco-tang-toc- antuong-124746.html
10)https://daibieunhandan.vn/kinh-te-xa-hoi/sabeco-ba-thang-dau-nam-lai-rong-hon-1-000- tydong-i335164/ 56

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