ng Sn Tng.

Vinamilks Pricing Strategy: Freshmilk.

Freshmilk.
Product Cost:
1. Production Cost: Milk price is relatively low compare to other
competitors yet still can cover production cost.
Vinamilk focus on controlling and examine the quality of its Milk to
maintain the quality of product.
Invests a lot in Technology to develop sustainably and remain its
competitive advantages.
Import high-end technologies:
- Sterilization in high temperature.
- Insulting Vacuum.
Buys technologies from:
- Tetra Park (Sweden),
- APV (Denmark)
+ import the production lines or license.
+ System is well synchronized, fully or semi-automated.
+ Ensure the quality of product.
Spend on Administrative software.
- ERP Oracle EBS 11i (management application)
- SAP CRM (Customer Relation Database)
- BI (Business Information Technology)
2. Input (Material):
- Buying milk from rural areas with low price to balance the cost.
- Great-size domestic farms (distributed in all 3 main regions of
Vietnam) - highly quality-centric standard.
- Now producing fresh milk with 100% domestic raw milk.
- Helps to stabilize its price.
- Provide customized cattle food to farmer with reasonable price.
- http://www.tienphong.vn/kinh-te/vinamilk-ky-hop-dong-mua-sua-
tuoi-nguyen-lieu-cua-gan-8000-ho-nong-dan-948586.tpo
External Factors:
Sales Expenses:
(phn ny khi present th ni thm l v chi ph cho nhg hot ng
ny kh cao nn cng nh hng n chin lc nh gi) OK nha!
Sales expenses take up 5-27% the Cost of Goods Sold.
- Advertising and promotion expenses make up a proportion of 1-
19.2%.
Quality and Reputation Demand and Buying Behavior of Customer.
- Keep the price but higher quality:
+ Bare in customers mind with stable price with improved quality
over time.
Large Expense in Promotion (Advertisement): Still be able to control
price.
+ Be able to cut off the administrative expenses: 15% to 1.053
Trillion VN (Vnexpress,2016).
- Customer Segment: Under 14 years old kids is the Target Market.
+ based on the range of the product, price to be fit for wide range
of buyer.

Other Competitor Prices:

Projected Value of Fresh milk segment in 2017 with the doubled value from
18 to 34 trillion VN. ( ny trong slide t s v biu v th hin l
competitive trong ngnh sa ti ang tng nh)
Inadequate policy in buying Raw milk product form farmers.
- Applied a lot of complicated regulation
- Different price in different period of time.
Exp: For instance, in 2014, in just 5 week (3-7 to 6-8) this year, raw
milk price that Vinamil offered fluctuated from 5.650 to7.130
VND/kg, while that of Dutch Lady is more stable, from 7.430 to
7.560 VN/kg.
Mega farms (great size farms) on all over the country help Vinamilk to be
independent.
References:
1. Vinamilk Pricing Strategy essay. [Online]. Available at:
https://www.slideshare.net/ndthien23/chin-lc-gi-ca-vinamilk
2. UK Essay. Vinamilk Dairy Product Catalog And Features Marketing
Essay. [Online]. Available at:
https://www.ukessays.com/essays/marketing/vinamilk-dairy-product-
catalog-and-features-marketing-essay.php#23-price
3. Brands Vietnam. Milk Competition in Vietnam. [Online]. Available at:
http://www.brandsvietnam.com/4594-Thi-truong-sua-nuoc-Cuoc-chien-
thi-phan-ngay-cang-nong
4. Dairy Vietnam. Competitive Strategy of Vinamilk. [Online]. Available at:
http://www.dairyvietnam.com/forum/threads/chien-luoc-canh-tranh-
cua-vinamilk.1924/
5. CafeF. Vinamilks Competitors. [Online]. Available at:
http://cafef.vn/vi-mo-dau-tu/ai-la-doi-thu-cua-vinamilk-
p33r2016082102483895.chn
6. VnEpress.
http://kinhdoanh.vnexpress.net/tin-tuc/doanh-nghiep/vinamilk-chi-gan-
25-ty-dong-moi-ngay-cho-quang-cao-khuyen-mai-3535652.html