ASSIGNMENT REPORT OF GROUP VIETNAMESE TEA

THE OPENING Vietnam is not only famous as the home of rice but also known as one of the most ancient cradle of tea. Vietnamese people have planted tea for over three thousands years and nowadays, drinking tea has become a traditional habit of each family. Belongs to the South East of Asia, Vietnam has many natural advantages to cultivate and process tea, such as climate, soil,... Therefore, the quality of Vietnam tea products is higher than other areas. In recent years, the area of tea cultivation and the number of manufacturers have increased rapidly. Particularly, from 5,400 hectares in 1975, the area of cultivation has reached to 80,000 hectares in 2000 with over 174 mills. The output was about 40,000 tons in 1995, now stands at approximately 80000 tons, of which export quantity rising from 17,500 tons 55,600 tons. Labour productivity in tea has risen annually by 4% during the last ten years. Up to now, Vietnam tea products have made their presence in more than thirty countries worldwide. Vietnam ranks fifth among the countries exporting tea. At present, Vietnam is known as a high quality green tea exporter with potential clients. In Asia, Taiwan and Japan are the biggest importers of Vietnam tea with an annual report amount of 10,000 and 5,000 tons respectively. Besides, Lotus tea is a part of culture. With the sophisticated product of Lotus tea, we plan to introduce this special culture from Vietnam to foreigner. The advertising of national traditional specialties like lotus tea to international friends will help promote cultural exchanges and mutual understanding between Vietnam and other countries in the world. The first market we choose to launch this product is Japan where consumes a great amount of tea everyday. Although intensive competition, our group believe that with the penetrate strategy for our Lotus tea, we hope to get a new trend in Japan.

CHAPTER 1: GENERAL INFORMATION

I. THE COMPANY AND ITS ACTIVITIES:

Tam Chau is one of the well-known tea companies at Lam Dong province which produces tea in special process and serves both in the internal and external markets. General introduction: Name of company: The Tam Chau Responsibility of Limited Headquarters: 11 Kim Dong street, Ward 2nd Bao Loc - Lam Dong province. Telephone: 063.3864566 Fax: 063.3862234 Email: Website: tamchautc@hcm.vnn.vn www.tamchau.com

Establishing date: 04/05/1999 Statute capital: 50.000.000.000 ( fifty billions vnd ) Founding person: Mr Nguyen Ngoc Thanh , Mr Nguyen Ngoc Chanh Brand name : Tam Chau.

Logo: Meaning: T and C is symbolized for Tea & Coffee which are the main trading and they are also the symbolizing of 2 founders; the circle is presented to the unit . The slogan of business: using the prestige to satisfy clients firstly. The Tam Chau name is meaning the brighter heart, the heart is as the precious stone. II. THE PRODUCT THAT THE COMPANY INTENDS TO ENTER IN THE FOREIGN MARKET We launch a type of Lotus tea with the name: Vietnamese tea Vietnamese culture in lotus tea. This is lotus tea following traditional methods but in modern process which helps to make tea with special flavor from fresh natural lotus blossoms and sweet taste of the best green tea leaves. The lotus is a perennial water plant that is native to Vietnam, where it represented in the national symbols of our nation, associated with human soul, spiritually and rebirth. Lotus tea is originally the Vietnamese specialty which we should be proud of and enhance. Besides, Vietnam is the fifth leading country in exporting tea of the world which bring great profit for producer. Are you aware that Vietnamese green tea gains a reputation as one of the finest green tea available? Therefore, the combination of culture in excellent exporting goods is a great idea which infers a lot of meaningful concepts and then this is also a competitive advantage.

Furthermore, lotus tea get a lot of healthy benefits while more and more people mention health issues, so our product could satisfy this demands. This is an excellent tea capturing the scent of the lotus and ideal for enjoyment along with local cuisine. III. THE FOREIGN COUNTRY THAT THE COMPANY HAS CHOSEN TO ENTER TO MARKET Japan has been a traditional green tea drinking nation for over 800 years and green tea is still a dominant part of people's daily lives, with a total annual consumption of approximately 90,000 tons. Actually, it may safely be said that the majority of Japanese consumers now know of the health benefits and medicinal effects of green tea that have been reported over the past 10 years, and they also recognize that those benefits can also be associated with other teas, including lotus tea.

CHAPTER 2: MARKET INFORMATION

I. GENERAL INFORMATION ABOUT JAPAN 1. Geography environment

Japan has a total of 6,852 islands extending along the Pacific coast of Asia. The country, including all of the islands it controls. The main islands, from north to south, are Hokkaid, Honsh, Shikoku and Kysh. About 73 percent of Japan is forested, mountainous, and unsuitable for agricultural, industrial, or residential use. Because of dangerous terrain, the road traffic of Japan is difficult. But the waterway develops very much. 2. Economic environment

a) Japan at a glance (all figures 2010)

Population: 127.4 million Capital: Tokyo Official Language: Japanese Currency: Yen GDP: $5.4 trillion

GDP Growth: 3.9%

Export in 2010: 770 million $ - 5,1% of the world Import 2010: 693 million USD - 4,5% of the world

b) Major products and industry Banking, insurance, real estate, retail, transportation and telecommunications are all major industries of Japan. Construction has long been one of the largest industries in Japan. Cereals, rice, dairy, beef and pork, and fruits and vegetables are all experiencing the decline to greater or lesser degrees. Rice remains Japans major crop, but falling consumption has led to chronic surpluses. The topography and climate makes Japanese farmers face many difficulties. Because this country is a cultivated crop such as rice, about half of food is imported from abroad. Due to limited natural resources to sustain economic development, Japan must depend on other countries for raw materials so the country imports a wide variety of diverse goods. The main import partners are China of Japan 21% [25], United States 12.7% Saudi Arabia 5.5%, UAE 4.9%, Australia 4.7%, Korea 4.7% and Indonesia 4% (2005 figures). The main imports from Japan include machinery, equipment, fuel, food (especially beef), chemicals, textiles and raw materials for industries in the country. In general, the overall Japan's largest trading partner is Chinese. The main export partners of Japan are the United States 22.9%, China 13.4%, Korea 7.8%, Taiwan 7.3% and Hong Kong 6.1% (2005). The main export items of the Japanese transport equipment, motor vehicles, electronic products, electrical machinery and chemicals. c) Current economics condition

In the past Japan has always won second place in economics. Balance of trade surplus and foreign reserves topped the world, so capital investment abroad a lot, the lending and aid reconstruction and development of the world's largest. Japan has many financial groups, banks leading the world. Now, considered an economic powerhouse, Japan is the country's third largest economy of global gross domestic product as well as the third according to purchasing power parity after the United States and the Republic People of China, and is ranked the fifth country in the world in the field of investment in defense ranked fourth in world exports and ranks sixth on the import world. This national organization is a member of the United Nations, WTO, G8, G4 and APEC. As a result, Japan is on the way of accelerating free trade, including cutting down barriers of tariff and nontariff, following the general rules of world trade organization. d) Infrastructure Transportation is highly developed in Japan, in 2004. In Japan is about 1,177,278 km (731,683 miles) of roads, 173 airports, 23,577 km (14,653 miles) of railway. Road vehicles may not operate primarily by All Nippon Airways (ANA) and Japan Airlines (JAL). Railways controlled by Japan Railways. There are many international flights from many cities and countries around the world to and from Japan. In Japan, the mass media such as TV, press, radiois highly developed. People can access the internet almost everywhere. People can quickly have all information in over the world. 3. a) Political environment

Government politics

Japan is a constitutional monarchy where the power of the Emperor is very limited. As a ceremonial figurehead, he is defined by the constitution as "the symbol of the state and of the unity of the people". Power is held chiefly by the Prime Minister of Japan and other elected members of the Diet, while sovereignty is vested in the Japanese people. Since the late 19th century the judicial system has been largely based on the civil law of Europe, notably Germany. b) Formal trade barriers

Goods imported into Japan are governed by various rules and regulations on quarantine and responsibilities of the manufacturer. The business product must compensate for damage caused by the sale of consumer products do not guarantee quality. Here are some laws that represent commercial and highly influential to the sale of goods: Japanese Agricultural Standard JAS, Product liability law and Food Sanitation Law In specifying, the types of foods are not allowed to enter Japan include foods that contain toxins or harmful, or suspected of containing toxins; the foods were rotting or damaged; these foods do not meet the standards and specification of processing, recipes or ingredients; the use of food additives, exceeding the permitted level; the foods that are not accompanied by documents proving. Some food items must also meet the strict regulations by testing newly imported into Japan as not containing the insect-pathogenic or harmful to human health in meat and fish, processed meat products such as hamburgers, hot dogs ... fruit, vegetables or grains.

c)

Promoting policies

With a number of import quotas, import quotas must apply at the Ministry of Economy, Trade and Industry of Japan (Ministry of Economy, Trade and Industry - METI). Procedure for import of goods of raw materials, processing raw or semi-regular is open and easier. Law Products sealed in packages or containers and specified by Cabinet ordinance are required by law to indicate their content as well as the name and address of their manufacturer (importer). The same law also requires the labeling of the net content to a range of error specified by Cabinet ordinance. Taxes Customs Duties

Consumption Tax (CIF + Customs Duty) x 5% d) Intellectual property

The development of Japan is based on a policy to compete with world markets through products with a high intellectual quality and reasonable price. Important factor encouraging the development of science and technology and the creation of competitive products as the main national policy on protection of intellectual property rights in Japan. This country became a national model in protecting intellectual property rights in the world. National Strategy is divided into the following four basic policies. We can generalize the four major content of Japan's strategy in a closed loop follows: Creative intellectual property Protection of intellectual property - Use of intellectual property - Improving the level of the people. With four major policy of National Strategy on Intellectual Property in Japan shows a closed loop of building an intellectual property system sustainable. This can be seen as the root of the system development and intellectual property that is effective, practical benefits for the country. 4. Social and cultural environment

Japanese culture characteristics Factors informing the unique Japanese characteristics are: They adapted to catering to authority and to harmonize with others.

They tend to place themselves in their own exclusive and closed communities. Accordingly, they have introverted personalities and they pay serious attention to harmony and cooperativeness in the group. They feel comfortable with familiar people in the communities they belong to. They developed their sense of allegiance in the group consequent to be exclusive. The behavior of competition and appealing themselves is observed only within their own community. On the other hand, they are enthusiastic in absorbing or imitating other cultures. Consequently, they have more interest in human feelings and emotions than scientific or logical concerns. In terms of book read, literary books rate more highly than scientific books, compared with westerners. Japan has a population of about half of the United States with a land area about 90% of the state of California. Therefore, roads, parks, houses, etc. are designed in miniature size. This environment influences largely their lives. They tend to pay attention to precise details rather than the big picture. They are better at developing transistors than space development projects. Mini-component audio systems are essential in their narrow houses often referred to "rabbit hutches". Japan is a country poor in natural resources but rich in hard-working and diligent people. II. 1. TEA MARKET IN JAPAN Introduction to the Japanese Tea Ceremony

Drinking tea is a custom thats been around in Japan, as well as many other parts of the world, for ages. Tea began as a medicine and grew into a beverage. In China, in the eighth century, it entered the realm of poetry as one of the polite amusements. The fifteenth century saw Japan ennoble it into a religion of aestheticism - Teaism. Teaism is founded on the adoration of the beautiful among the sordid facts of everyday existence. Teaism is connected with Zen. The tea ceremony was a development of the Zen ritual. The whole ideal of Teaism is a result of the Zen concept of greatness in the smallest incident of life. In 16th century Japan, Teaism was indurated by RikyuSen (1522 - 1591) as the Wabi Cha style, which emphasizes nature and simplicity. Teaism made an enormous impact on Japanese architectural style, habits, costume and cuisine, porcelain, lacquer, painting, and literature.. 2. The scale of tea market in Japan

Tea, especially green tea, is one of the most important beverages of Japanese. Every year, Japanese consumes about 100 000 tons of tea, mainly green tea, and 85% from domestic production. Japan ranks the fifth in importing tea with 47 341 ton in 2007, taking 4,7% of importing tea over the world. Table 1: Countries export tea to Japan in 2007 Country Imports (1000 USD) Share (%) Import volumn (tons) Average price (USD/ton)

World China Sri Lanka India England Taiwan Kenya Indonesia France Vietnam USA Brazil Holand German Australia Malaysia

180.465 88.547 44.315 21.828 7.941 6.226 3.972 2.377 1.049 1.004 769 765 429 418 185 110

100 49,1 24,6 12,1 4,4 3,4 2,2 1,3 0,6 0,6 0,4 0,4 0,2 0,2 0,1 0,1

47.341 30.188 10.378 2.752 280 579 1.615 877 26 341 29 98 37 50 12 5

3.812 2.933 4.270 7.932 28.361 10.753 2.459 2.710 40.346 2.944 26.517 7.806 11.595 8.360 15.417 22.000

(Source: TradeMap-ITC)

World tea market share 2009

Table 2: Predicted sales of different kinds of tea in Japan over the period 2009 - 2012 2009 Tons Green tea Herb tea RTD tea Black tea Others Total 2010 Yen billion Tons 60.808,3 4.928,7 4.094,0 18.069,0 10.537,8 98.437,7 2011 Yen billion ons T 316,6 57,9 4,7 89,1 28,1 496,5 2012 Yen billion Tons 61.356,8 5.428,7 4.255,2 18.321,9 10.443,2 99.805,8 Yen billion 320,1 63,9 4,9 90,4 27,9 507,2

60.445, 6 314,4 4.702,9 4.021,6 55,2 4,6

61.112,4 318,5 5.170,2 4.171,8 60,8 4,8

17.882,0 88,2 10.601,4 28,3 97.653,6 490,7

18.217,7 89,9 10.485,1 28,0 99.157,1 502,0

2.4 a)

International competitors Green tea market trends Projections for green tea are provided only for production and exports due to data limitations. World green tea production is forecast to increase from 680 700 tons in 2000 to 900 000 tons in 2010, reflecting an annual average growth rate of 2.6 percent. During this period, production in China would grow by 2.7 percent per annum from 500 000 tons to 671 000 tons, accounting for 75 percent of global green tea production in 2010, compared to 73.5 percent in 2000. Production in Japan would grow by an average rate of 0.1 percent to 90 800 tons, while production in Viet Nam is expected to increase by an average rate of 2.5 percent to 50 000 tons.

Green tea exports are expected to exhibit a significant upward trend in keeping with production. Total exports would increase by 2.8 percent annually from 186 800 tons in 2000 to 254 000 tons in 2010. China would continue to be the worlds dominant green tea exporter, with shipments reaching 210 000 tons by 2010, reflecting an annual average growth rate of 2.7 percent. During the same period, exports from Indonesia are expected to increase by 3.8 percent per annum to 12 000 tons, while exports from Viet Nam would increase by 2.5 percent a year to 25 000 tons. Japan would consume most of its domestic production. Table 3: Green tea: actual and projected production and exports PRODUCTION Actual Projected Growth rates 2000 2010 1990 to 2000 2000 to 2010 EXPORTS Actual 2000 Projected 2010 Growth rates 1990 to 2000 2000 to 2010

000 tons

Percent per year

000 tons

Percent per year

World

681

900

2.5

2.6

187

254

6.3

2.8

China Japan

500 90

671 91 50 49

3.8 0.0 4.3 1.0

2.7 0.1 2.5 2.3

156 1 19 8

210 1 25 12

5.8 8.0 11.0 14.4

2.7 0.0 2.5 3.8

Viet Nam 38 Indonesia 38

b)

Potential competitors

According to table 2, in green tea world, China is the country that exports the largest tea volume and dominates the Japanese tea market (49% of tea imported). So, we may face a great competition from companies in this big country. However, due to our competitive advantage culture concept and health benefit these companies are not our direct competitors, but those comes from Vietnam are our main point because they can have the same product strategy like us and then enter our market. We can tell here the Future Generation Company located in Thai Nguyen. This is a big group of tea in

Vietnam and they also export their product to Japan. Future Generation specializes in processing and exporting fine Vietnamese teas around the world, both in bulk and packaged. Future Generation has carved itself a niche in the international tea markets with attention to detail, quality products and a slick marketing strategy that earns repeat orders and attracts new customers. Hereby is the famous brand name in Japan and its competitive advantages: Kirin, the Cola-Japan Group, Lipton, Suntory (brewers), Asahi (brewers), Pokka, Ohtsuka, UCC Ueshima Coffee, and Daido-drinco: The major reasons for their widespread success are wider distribution and availability, heavy advertising supported by easily readable and fancy names, continued improvement and innovation in both quality and packaging that appeal strongly to the younger generation. ITO EN has grown to account for over 20% of the green tea market in Japan, as measured by purchases of crude tea. ITO EN is also the top manufacturer of ready-to-drink green tea beverages in Japan, with a market share of more than 30%. Since 2005, ready-to-drink green tea has consistently accounted for over 20% of all green tea consumption in Japan.

Exports of Colorado's agricultural products jumped to a record high of $1.16 billion in 1995, a 24 percent increase over 1994. And based on year-to-date figures, the Colorado Department of Agriculture expects 1996 to exceed $1.27 billion. About 25 percent of Colorado's total agricultural exports are to Japan, making it, by far, the largest market for Colorado's food products, according to the Colorado Department of Agriculture. "Celestial Seasonings hasn't used JETRO's programs," said Satoshi Sato, an economic researcher with the trade organization, "but they have been very successful in exporting to Japan." The tea maker has been exporting its products to Japan for about three or four years, after it struck up a relationship with UCC Ueshima Coffee Co., the largest manufacturer and distributor of coffee in Japan. They buy the tea from Colorado and then resell it in Japan through the same channels of distribution [it uses to sell its] coffee."

According to the company's 1995 annual report, international sales account for about 12 percent of total business volume. The company reported $70 million in sales last year. Japan is a country of tea culture, so the businesses in this area are numerous and the competition in this market can be said is very difficult. Therefore, to compete with rivals requires our company to invest in quality and eye-catching design. Besides, we must offer the best price to compete with other competitors.

CHAPTER 3: SWOT ANALYSIS

I. 1. Strengths Infrastructure: Tam Chau Farm:

o Function: specialize in high quality teas. There are some factories specializing in producing tea for exportation. o o o o o o o Area: approximately 400 ha

Productivity: 100 ton/year Labors: 500 people. Tam Chau Farm is presently divided into 02 units: a. Farm 1: b. Farm 2: Established in 2001with nearly 100ha area Established in 2004 with nearly 300ha area

The Tam Chau tea factory: Function: research and produce the tea,coffee Area: 5 ha labours: 100 persons . productivity: 5500 ton/year for green tea The technology line :

The processing line of green tea: including the processing at first time, to refine and to put it in the pack. Technology: Vietnam, Taiwan and Japan Main product: Oolong tea, Japan green tea, Vietnam green tea, green tea with the jasmine The processing line for producing the filter tea

Technology: Taiwan Main product: the Oolong filter tea, the green filter tea, the jasmine filter tea, the atiso filter tea Material sourcing:

Green tea is the product derived from typical botany about Tamin compound (acrid taste). Green tea is of unfermented tea group (otherwise totally elimitating ferment) so it can keep entire substance available in fresh tea with high content. Material of fresh tea is selected from farmers tea gardens invested with Tam Chau caring technique, harvesting, and the microorganic technology for caring tea tree replaced

insecticides, chemical fertilizerssatisfying consumers increasing demands on biological safety. These biological products are totoally harmless to consumers body. Young tea buds are harvested, maintained and processed in Japan equipment, technology chain. During processing green tea, tea steaming is the most important phase, thanks to this phase; finished tea has fresh green or yellow green color, strong acrid taste and natural flavor.

. CONSUMPTION

Tam Chau tea products are widely nationally accepted and consumed. Its recognition is credited not only from its elicious taste but also from the strict standards of sanitation. In addition, the sources of raw material for production lay an important role in our priorities with the purpose to enhance the quality of our products.

The methodology of Bio planting and the minimal quantity in use of insecticides allow us to meet the strict standards f sanitation in the industry of beverages. Our health and quality of products are the number one goals for us to pursue nd perfect.

Tam Chau is a reputable producer and a serious business entrepreneur. All visits and inquiries about the company, roducts, processing plants as well as plantations are welcome and provided free of charge.

3.

FOREIGN MARKET

Tam Chau tea products is preferred and consumed widely in the world. Besides its deliciousness, the application of fresh production process from cultivation to finished product processing together with Japan, Taiwan modern technologypresented high quality product ensuring health for consumers, meeting strict requirements of local markets. Presently, the main export markets are Taiwan, China, USA, Hungary, Germany, Switzerland, Pakistanand potential markets such as Thailand, Indonesia, Malaysia, and Singapore

For customers, the companys norm is the consumers health. For commercial partners, their norm is the long-term cooperation, mutual development.

Available Tam Chau tea varieties are multiplicated in the companys arboretum by tissue grafting method from original materials in order to maintain fresh quality of teas, at the same time cultivated in the orientation of Integrated Crop Management ICM that is applied all over the world. The remarkable point in this process is that the tea gardent is cultivated by nutritient regulation from microorganic fertilizer with special substance from fresh milk, chicken eggThe use of biologic organic fertilizer, plant protection medicine from biologic products such as Neem Oil, Citrus Oil or Bacillus Thuringiensis BT, the limitation in using agricultural chemicals and irorganic fertilizer in order to enhance tree quality, at the same time protect environment. In addition, Tam Chau farm also built a factory with the area of 5.000m2 with modern equipment, technology of Japan, Taiwan, USAproduced by a closed process. II. WEAKNESS

However, Tam Chau also have to face many difficulties, of which the main problem is the capacity of processing factories. The total output of the factories havent met the domestic demands and exports because most of their equipment are not enough to keep up with trend. For example, in Japan, they have a modern process that produce a kind of RTD bottle with the tea package inner and this process costs 5 million US dollar. We need to invest in new technology and develop new, better strains of tea. This is expensive, and the government has no money to help, so private industry has to invest themselves. In order to solve these problems, Tam Chau needs to set forth some strategies for stable development in the future. In short-term, tea growers is required to invert in equipment and processing technology, as well as improve the quality of tea. Recently, Vietnam imported several modern processing lines and some new varieties of tea from India, China, Srilanka. In long-term, the company should encourage foreign investors to co-operate with them for building new model processing factories as well as expanding the market. III. OPPORTUNITY Preference of green tea in Japaneses life Green tea's traditional role in Japanese society is as a drink for special guests and special occasions like pyesta and inuman. Green tea is served in many companies during afternoon breaks. Japanese often buy sweets for their colleagues when on vacation or business trips. These snacks are usually enjoyed with green tea. Tea will also be prepared for visitors coming for meetings to companies and for guests visiting Japanese homes. A thermos full of green tea is also a staple on family or school outings as an accompaniment to bento (box lunches). Families often bring along proper Japanese teacups, to enhance the enjoyment of the traditional drink. The strong cultural association the Japanese have with green tea has made it the most popular beverage to drink with traditional Japanese cuisine, such as sushi, sashimi and tempura. At a restaurant, a cup of green tea is often served with meals at no extra charge, with as many refills as desired. The best traditional Japanese restaurants take as much care in choosing the tea they serve as in preparing the food itself. Many Japanese are still taught the proper art of the centuries-old tea ceremony as well. Still, the Japanese now enjoy green tea processed using state of the art technology. Today, hand pressinga method demonstrated to touristsis taught only as a technique preserved as a part of the Japanese cultural tradition. Most of the ubiquitous vending machines also carry a wide selection of both hot and cold bottled teas. IV. THREAD

Japan have a extreme high standard for its goods quality. Especially, some food items must also meet the strict regulations by testing newly imported into Japan as not containing the insect-pathogenic harmful to human health. Tea is one of the items that are tested strictly. So, our manufacturer needs to follow all of these standards which are not easy to satisfy. This is a kind a technology barrier. We had better update Japans health certificate for our lotus tea, so we may spend some money to get certified. And our product is slowly launched into the market. Japan has complex distributed systems. There are many types of goods distribution. So we need a suitable choice.

 Habits of consumption goods is also a long barrier to market entry product. Nowadays, there are
specific kinds of tea that Japanese are interested in: o o o o Grinded tea: tea are grinded into powder so that its very quick to get a cup of tea RTD bottle with tea package inner Rice tea: dried rice mixed with tea Soya tea: dried soya mixed with tea

These are popuar teas in Japan and Japanese pay attention to such items that are good for health, trendy and safe.

In addition, tea exporters in Japanese market are bigger with every passing day while the
customers always require higher quality, finer style and reasonable price. Many Japanese tea such as Lipton tea is particularly large market share rivals. They have a dominant position now and have a good image in consumers. Our brand is somewhat a new one with Japanese.

Many atternative drinks have been long in the market such as the starbucks cafe, Lotte, ... its
really an intense competition.

CHAPTER 4: PRELIMINARY MARKET-ENTRY STRATEGY OR PLAN

I. PRODUCT STRATEGY

1. Product concept: 1.1 Attributes:

Traditional artisans from Dong Thap province harvest fresh lotus blossoms which are blended with green tea leaves in an ancient method to create our Lotus Green tea. The part of the lotus used to scent tea comes from inside the flowers big petals. There are typically hundreds of petals hugging each other, hiding the stigma, the anthers and lotus seed pod. Once the petals are removed, the white seeds for anthers at the stamen are cut out and mixed with tea. The mixture is kept in a jar for one to two days, which gives the anthers time to coil. The blend is then placed inside a bain-marie or water bath. The temperature is set to a gentle heat to preserve the teas flavour. This ancient scenting method is repeated multiple times before the tea is ready to use. Scenting a kilogram of tea requires as many as one thousand lotus flowers. The result is a curled green leaf with a slightly sharp flavor with the invigorating and floral sweetness of aromatic lotus blossoms. As a rule, Vietnamese lotus tea has a pale color, delicate fragrance and pleasant taste that is distinct from other types of tea. The long lasting sweet flavor and intoxicating aroma of lotus is what no other tea can offer. Moreover, with this traditional method, all the health benefits of lotus and green are kept in itself all the time so that Lotus tea could bring all the best benefits to tea drinkers. On the other hand, all are processed in professional processing line including the processing at first time, to refine and to put it in the pack, according to the technology of Vietnam, Taiwan and Japan. In conclusion, green tea is favorite beverage in Japan and Japanese drink tea everyday as a habit. So, lotus green tea is sure to satisfy all their needs and with its perfect taste, this product will soon be accepted popular in Japan. 1.2 Material source: - Lotus from Dong Thap, especially in My Quy, My Dong, Lang Bien, whose area is about 460 hectares while each hectare produces 50 60000 flowers each 5 months. Therefore, the supply of lotus is rich.

- Green leaf tea from Tam Chaus farm (400ha in totally, but 100ha specialize in green tea). The
plantation is fantastic, unspoiled, the farmers have never used any kind of chemicals on the land, at exactly the perfect height and climate, and we believe we have excellent quality. The problem now is to get organic certification that is recognized by the countries we would like to export to - The factory is in Lam Dong, near Tam Chaus farm.

1.3

Health and dietary benefit: without any added sugar or any form of sweeteners, lotus tea is the one responsible for its magical powers: - a relaxing beverage that has calming properties that reduce stress, alleviate heart palpitations, restlessness and insomnia.

- a rich source of the particular antioxidant which is considered as one of the best weight loss alternatives. - cool down properties, and detoxify - lowers total cholesterol levels, as well as improving the ratio of good (HDL) cholesterol to bad (LDL) cholesterol - reduce the risk of esophageal cancer - Help relieve the symptoms of diarrhea and improves the appetite. => Japanese tend to pay much attention in health care so they could afford for anything that could bring positive effect to their health. A cup of lotus green tea gives a wonderful feeling of relaxation and calmness, which could become a key factor of product attribute as well as competitive advantage. 2. Branding and packaging: The products name is Vietnamese tea with the message: Vietnamese culture in lotus tea. As you know, Japanese are enthusiastic in absorbing or imitating other cultures, so with this brand name, at first customers will be attracted by the curiosity of a quite different kind of tea and then they also want to try something from the Vietnamese culture which is famous for its excellent tea. Then, after the first time of using, customer will be persuaded by its health and dietary benefits as well as pleasant taste from lotus tea. The package is followed all the codes of practice of ISO 22 and SC4 Packaging and the Environment. With its excellent quality, the packages are for luxurious products. For the reason that Japanese tend to pay attention to precise details, the package needs to be designed in a sophisticated way; the outside is high-quality paper box with art of lotus and Vietnamese characters. On the package is interesting information about the health benefits for tea drinkers. By the way, we also provide such necessary information as: producer, date of production and expired day, ingredient, how to use, price, weight. All is in English and Japanese. Divided into 3 kinds based on 3 ranges of products: - The customized size: 100gr for more often users - The big one: 300gr for favorite customers or for gift giving. This are designed with special materials for sophisticated features.

II.

DISTRIBUTION STRATEGY

1. DISTRIBUTION CHANNEL
The small retail stores are concentrated in the populated areas and trading of food, clothing and other consumer goods. Due to small they are characterized by convenience and good service. In Japan the large department stores and supermarkets also serve the retail business, but the business performance of the supermarket is not high due to lack of flexibility, economy and more declining consumer. In Japan, retailers are not shops, specializing in business sales through catalogs, telephone,

internet, computer sales and home delivery. Sales of this type of sale is not very big, but is growing rapidly in recent years. In the goods distribution system in Japan, since the goods are produced and delivered to the retail stores exist many intermediate-level distributors, more than other industrialized countries. Japan has over 430 thousand wholesale establishments, on average approximately 34 wholesalers to 10,000 residents. If the relationship between the manufacturer to the retailer, the average of 2.21 between wholesalers and retailers, producers, greater than 2 times compared with 0.73 in France and one in the U.S. . In Japan, consumers can return the goods such as clothing, books and pharmaceuticals. Of course, the goods must be intact labels, stamping. Structured between manufacturers and distributors: Manufacturers to provide funds for the wholesalers and the wholesalers to provide finance for retailers, to implement the regime on retail prices, regular discounts and commissions extensive regime of manufacturers are willing to buy back unsold goods if the retailer and the only item of business by wholesalers and manufacturers delivery. Japan's retail prices average higher than in the U.S. is 48%, in the UK is 55%, does not stimulate the retail efforts for improving the business performance, lower cost products, maintaining the number of large retail stores are not effective; not transparent about product pricing, limits of penetration of the Japanese market, foreign companies. 2.Recommend a distribution channel and intermediaries. As indicated above, not transportation, but the distribution channels and buying habits is the biggest barrier preventing our products to consumers. Following the above analysis, we decided to partner with a convenience store system for ease of getting the product to consumers. According to our understanding, 7-Eleven owns the largest convenience stores chain in Japan. 7Eleven market dominationby a small, but mobility and convenience. They are usually located at the corner modest or even immediately adjacent to the gas stations, but often the focus intersection densely populated. Tourists or people buzzing around that can run three miles to buy slices of bread, water bottles or other items such as toothbrushes, razors. To increase mobility and flexibility, the current 7-Eleven systems worldwide are active 24/24 hours all week. Even, the store focused to meet the different needs of busy shoppers in different areas. All items are selected for quality, prompt delivery and safety in a friendly atmosphere. With stores and credit of 7-eleven, when we deal with this company will make products available all over Japan. Combined with other marketing activities, the product easily accessible to consumers.

III.

PROMOTION STRATEGY

1. Target market:

Based on the difference as a culture concept and its health benefit, our product satisfies demands of these segments: Middle class and middle upper class: Income: > 350 000 JPY The 30 year old or above who mainly take care of their health Those who often work hard under pressure. Young people who are interested in drinking tea and different kinds of tea from all over the world. Knowledgeable, trendy
According to the Japans population structure, approximately 65% of population is in the age of 15 65 (target market) and 25% are more than 65 years old (potential customers). Therefore, our target market and potential customers are in the big scale.

2. Promotional goals Currently, there are a few firms has provided lotus tea for this potential market such as: Future Generation Co.,ltd, so our promotional goals is supplying information for more new customers and attracting more customers. We build promotional goals follow AKLPCP model: - Awareness: Inform the product and brand to customer with a simple message: the existence of Lotus tea: we can use short advertisings on TV, or Panels at Public - Knowledge: when customers have known about product, we use media to supply more information: we can use long ads and training for all sale staffs the way they introduce to customers - Liking& Preference: introduce the differences between our brand and the others. - Conviction & Purchase: persuade customer our brand is the best choice. 3. Design promotional message ( USP- unique selling proposition )

Because our product is atraditional typical product for Vietnamese culture, we decided our slogan is Vietnamese culture in lotus tea.This is an emotional selling proposition, it makes people has more curious. Then, theyll try to discover the message and our brand naturally sinks in customers mind.

4. Select mix-promotional media a. Advertising: Because Lotus tea is a consumer good, advertising is the most important method. We selected: TV, radio: using a long video to introduce detail information on TV, short advertising on Radio focused on the way of making traditional lotus tea and how
Vietnamese people enjoy the drink so that we can draw attention from customers.

Internet: Japan

using

some

famous

website

for

food

and

drink

in

:http://www.shibatr.com/,

http://www.amazon.co.jp/,..

( Hnginthmvo) b. Sale Promotion: we will use this way in B2B market not in B2C market because of our price strategy we re pursuing. c. Personal Selling: holding trial tea drinking at bars, at tea chops, shopping mall... d. Public Relation: sponsorship for an Vietnam-Japan Cultural exchange Program and take part in consumer goods fairs.
IV. PRICE STRATEGY 1. Business Environment: Japan is one of the countries that average income of people is highest in the world, per capita income more than 33000 USD (according to statistics beginning in 2011). With relatively high income, Japan is one of the most demanding markets in the world product. Moreover, in 2011, the inflation rate expected in Japan rose 0.3%. The inflation also affect people's spending, so businesses will adjust the price of lotus tea so that people can buy. To trade in Japans market, our company will research on information about laws system to operate our control efficiently. Besides, our company will coordinate with Japans Government on complying with this countrys regulations. 2. The factors of production:

2.1 Input: To produce a box of lotus tea, the inputs are indispensable, and its price is the deciding factor the final product price. Specifically: - Green Tea: the raw material from Tam Chaus farm, green tea is produced by the process technology professionals. The cost is about 50.000/kg. - Lotus: were taken from lotuss cooperative at Dong Thap, the lotuss cost is from 15.000 to 20.000 VND / kg. Although the lotus grows seasonally, but in Dong Thap, with lotus-season planting technology, enterprises will receive year-round supply. - Lotus tea processing technology according to international standards were acquired businesses. - Labor force participate the production as well as a factor in determining price. Abundant labors resources help company get better productivity in manufacturing, supplying enough product to market. In addition, the management force are the component that is impossible not to mention. With a team of professional management, businesses will be able to develop products in both width and depth. Therefore, the salary for this force is relatively high and it also affects the general price level of products that can help business profit - Packaging: the form of paper and wooden boxes, packaging production process has been studied business and make eye-catching to attract customers. To get a nice design and quality, keep the quality of lotus tea in the packaging, our company has researched and has given the products with the best quality. Thus, prices for packaging a significant impact to the product. - Cost of product quality inspection before making a foreign market. - Cost of researching market and developing products. - Cost of electronic, water, factory, machines 2.2 Output - Cost of shipping products. - Costs of promoting brand image in Japan. This can be considered a source of great expense to bring a new product to market. 3. Pricing strategy: 3.1 Target Customers: With target customers who are middle-income more and direction to healths purpose, our company will decide the price level is relatively high and stable at that price. In addition, Japan has been a culture of drinking tea every day, so the exports tea to Japan have great potential. Demand for high tea and coordinate with the new tea products, high product quality, as well as tasting fanfare, the number of customers to the products expected to increase when these products enter Japanese market. 3.2 Pricing strategy:

In Japan, although tea is a traditional culture and strong identity, but the kind of lotus tea has not really existed. Therefore, lotus tea entering the Japanese market may face many difficulties and challenges. Therefore, our company decided to implement price skimming to dominate this market and to compete with investors here. The main purpose of the price skimming strategy that the enterprise planned is to attract loyal custommers and acceptable to buy product at a high price. Moreover, the nature of the product, high price, along with strong marketing strategy will help our company could claim the brand as well as the quality of lotus teas products in Japan. Based on scale of labor, production technology, raw material inputs that have done business analysis and decision making for product price of lotus tea of Vietnam. The prices details are as follows: - For 100gr lotus tea products, the price will be set at 2000 yen, equivalent to 544.000 (Exchange Rate: 1JPY = 272 VN) - For 300 gr lotus tea products using daily, the price is 5.800 yen, equivalent to 1.577.600 - For 300 gr lotus tea products using wood donated by the box, the price is 6.900 yen, equivalent to 1.876.800 Price skimming that we give could help us to confirm in this market. Although tea in Japan is not new, lotus tea is a new type in tea market. Therefore, prices are high and quality is guaranteed to help our company to gain customers as well as avoid potential interference of the competitors. The lotus tea provides a feeling of relaxed, comfortable and well proportioned body, while other natural teas not do that. Therefore, our company can fell confident that lotus tea with price skimming will compete with the producers of tea in Japan.

Strategy or plan implementation - Set schedule for the actions that are recommended above. - Assign specific individual(s), group(s) or unit(s) to each proposed action.

Cost estimation and financing for market-entry strategy or plan implementation

- Estimate all costs and expenses that are necessary for implementing each of the recommended actions. - Recommend the financing sources (if possible).