Good & strategic US lives next to the big guns
Do not agree to sell the company for Unilever, owner of My Hao chose difficult: finding a niche to survive alongside stronger opponents multiplied.
After a period of lost customers, My Hao clearly see the importance of the distribution system. So far, My Hao has found shelter for their product development.
One fine day in 1995, the director of a multinational corporation to JSC My Hao Cosmetics brand hinted acquisition Hao dishwashing liquid. No one else, that is the consumer goods conglomerate Unilever. The first time Unilever paid only a few million dollars, but in 1998, they paid $ 10 million and 3 years ago Unilever to $ 30 million. "Representatives of the company told me, the private company has no longer relevant should go to My Hao dishwashing liquid on with Unilever. But I decided not to sell, "said Luong Van Vinh, CEO of My Hao Company, said.
The price of hard-headed
Mr. Vinh does not sell because they want to leave to their children and want to keep the inheritance of the company brand in Vietnam. According to him, if everyone is selling, the market of Vietnam will soon Vietnam now squeaky clean. It was a brave decision. However, the cost of that choice is My Hao has lost a lot of customers to rival Unilever.
Previously, Hao was not brought to market, but the agents will come to their loading docks. As in Vietnam, the multinational enterprise has rapidly built a distribution system in the US agents Hao. Agent fades, My Hao trouble immediately. At this point, Unilever has to reset problem Hao buy American brands again. "Although Hao dishwater then accounted for about 50% of the market, but failed to hold and unknown channel customer care, after 3-4 months fell 46-47% and so lost. Now I realize, is to survive, the company must have a strong distribution system, "Mr. Vinh said.
Aware of that, My Hao has close ties with the vendors still sell their products, offering them incentives such as discount commissions on product value is greater than before. Orders less than 500,000, the United States agent Hao discount for 1%, then 2% on 500,000. For those dealers have lost, My Hao replaced with the new distributor. According to Vinh, the capital of the United States is good no more, the company is difficult to spend money to advertise that can only increase the presence of the product on the market through the distribution system.
In 1998, Mr. Vinh invested heavily in the distribution system in many provinces. Distributors self storage investment, financing and delivery stages. Hao has staff in search of individual orders to distributors. To encourage dealers exhibit their products, the company supports 25,000 VND / month for retailers any products exhibited 16 Hao. However, this policy has not brought the expected effect. Therefore, Mr. Vinh efforts to find additional outlets for the product. Every month, he personally inspected the entire distribution system in the province of My Hao to find the crux of the problem.
Find more direction
Hao has focused resources on building distribution systems. However, practice shows, the cost of money for this is huge. Mr. Vinh calculations, after deducting all expenses, the Company only 5% of the profits. 2009 revenue growth of just 5% My Hao, 2010 and 2011 reached 10%.
To increase sales and profitability, the company find export to new markets. Besides the United States has exported Hao 10 years as Taiwan, Laos, the Philippines, the company started exporting to North Korea from 3 years. According to Vinh, this is a potential market. Besides, My Hao also extended to Cambodia. Because beginners should exploit new Hao US sales of approximately 1 billion / month here.
Hao rising US rates strategy increased sales in modern channels such as supermarkets from 8% of total revenue as at present to 10% in 2012. According to Mr Vinh Hao's total sales in the country in 2011 is 60.5 billion / month, while the modern channel is only about 4.84 billion / month. So he decided to keep the traditional channels, but has invested much effort and more money to promote products on modern supermarket channel.
Reduce dependence on a single product and increase sales of other products as well as a new strategy to help American Hao additional revenue and profits during this period. Mr. Vinh admitted, the lineup of My Hao unbalanced development. Currently, dishwater 70% of total sales, and the rest of other products such as clean glass of water, soap, bleach, softener ... the remaining 30%. The question, how to increase sales from products not dishwater to diversify the revenue structure?
Hao has reviewed the entire sales process, encouraging the distributors take all other products of the Company to sell items with good consumption. Marketing staff of the company are also required to offer more items other than dishwater. Besides, My Hao also focus on investment for product packaging. Until 2011, a number of local products such as soap, floor cleaner, fabric softener grew 50% compared to 2010. For instance, the floor cleaner, previously, in 1 day only sale Hao 1,000 bottles, the bottle has sold 3000-4000.
Seeing the actual needs of the market is large, Hao decided to expand the scale of production from 16,000 m2 to 50,000 m2 up to increase the number of products. He lives next to the large, US enlist Hao know to raise their real stature, besides the strategies wriggled into the corner of the market as he did previously.