Strategy to promote coffee exports to the german market in period of 2022 2030

<span class="text_page_counter">Trang 1</span><div class="page_container" data-page="1">

<b>STRATEGY TO PROMOTE COFFEE EXPORTS TOTHE GERMAN MARKET IN PERIOD OF 2022-2030.</b>

<b>BACHELOR OF BUSINESS(ENTREPRENEURSHIP) HONS</b>

<b>HELP UNIVERSITY</b>

<b>AUGUST, 2022</b>

</div><span class="text_page_counter">Trang 2</span><div class="page_container" data-page="2">

<b>STRATEGY TO PROMOTE COFFEE EXPORTS TO THE GERMAN MARKETIN PERIOD OF 2022-2030.</b>

<b>DOAN THI VAN ANH</b>

<b>Graduation Project Submitted to the Department of Business Studies,HELP University, in Partial Fulfilment of the Requirements for</b>

<b>the Degree of Bachelor of Business (Entrepreneurship) Hons</b>

<b>STRATEGY TO PROMOTE COFFEE EXPORTS TO THE GERMAN MARKET IN PERIOD OF2022-2030.</b>

</div><span class="text_page_counter">Trang 3</span><div class="page_container" data-page="3">

I would like to assure you that the thesis is my own research work, not copied by anyonewho has researched, read, translated, synthesized and performed by me. The theoreticalcontent in this graduation thesis uses some references as presented in the referencessection. The data, software programs and results in the thesis are truthful and have notbeen published in any other work.

Doan Thi Van Anh

</div><span class="text_page_counter">Trang 4</span><div class="page_container" data-page="4">

Thank you very much!

</div><span class="text_page_counter">Trang 5</span><div class="page_container" data-page="5">

This study was conducted by students of ….. on the topic of graduation thesis,Strategy to Promote Coffee Exports to the German Market in Period of 2022-2030. Asthe name of the topic, the study is updated on the preliminary and general situation ofVietnam's coffee export business to the German market, and thereby studying a strategyand solutions and solutions. In order to make it contribute to promoting the export valueof Vietnamese coffee to Germany. This is a problem that is not too new but the value itbrings and is necessary when its application is very high because coffee is one of themain agricultural products of Vietnam if exploited effectively. It will bring manybenefits to the economy, especially in economic conditions like this, having a strategyfor sustainable development in each stage is an important thing for the state. andfarmers. The scope of the research is limited to the period 2022 to 2030 so almost thedata will be collected from the official and continuous information sites, along with thebasis of the knowledge that you have accumulated. In the course of studying at school,along with the supervision and instructions of …... The test is integrated with manymethods from collecting data to analytical methods including expert consultationmethods that are considered optimal and increase persuasion for the research. Researchmissions see urgent and lack of mercy in expanding the coffee export market to theGerman market, and finding appropriate measures to form a strategy to boost export.Through the reviews that the research has presented, with the comments of experts, thenominated measures are feasible and practical effectiveness. Hopefully, the research willbe commented and built to complete the missing things, to have a picture of strategy thatpromotes Vietnam to export coffee to the German market clearly and clearly andSustainable, effective.

</div><span class="text_page_counter">Trang 6</span><div class="page_container" data-page="6">

1.4. Research Object and scope...9

CHAPTER2: LITERATURE REVIEW...11

2.1. General concept of strategy...11

3.2.4. EFE data analysis method:...16

3.2.5. IFE data analysis method:...19

3.3. SWOT matrix analysis:...20

CHAPTER 4: ENVIRONMENTAL ANALYSIS...24

4.1. Business environment between Vietnam and Germany...24

4.1.1. Politics, the law...24

4.1.2. Culture-society...24

</div><span class="text_page_counter">Trang 7</span><div class="page_container" data-page="7">

4.1.3. Economic factors:...25

4.1.4. Science and technology...25

4.1.5. Natural...26

4.1.6. International competition...26

4.2. Coffee export environment in Vietnam...26

4.2.1. Vietnam's coffee export role...26

4.2.2. Forms of coffee export in Vietnam:...31

4.2.3. Overview of economy and techniques in Vietnam's coffee production...37

4.2.4. Current capacity of Vietnamese coffee...39

4.3. Overview of the German Environment...43

4.3.1. Characteristics of the German market...43

4.3.2. Requirements when importing coffee into the German market...53

4.4. Current Export Status of Vietnamese Coffee to the German Market...56

4.4.1. Export turnover...56

4.4.2. Structure of exports...57

4.4.3. Market structure...58

4.4.4. Quality and hygiene and food safety...58

4.5. Swot Analysis of Vietnam Coffee Exports to the German Market...59

4.5.1. Strengths (S)...59

4.5.2. Weaknesses (w)...61

4.5.3. Opportunity (O)...63

4.5.4. Threat (T)...64

4.5.5. Opportunities, Threats and EFE Matrix:...65

4.5.6. Strengths, Weaknesses and IFE Matrix:...67

4.5.2. Summary of SWOT matrix...68

</div><span class="text_page_counter">Trang 8</span><div class="page_container" data-page="8">

CHAPTER 5: SOME STRATEGIC RECCOMENDATION FOR PROMOTING

VIETNAM’S COFFEE EXPORT TO GERMAN IN 2022-2025...72

5.1. Strategic objectives...72

5.1.1. Direction of vietnam coffee development in The German market...72

5.1.2. Trends in the German market for coffee...72

5.2. Strategic content for Exporting Vietnamese Coffee to the German Market...73

5.2.1. Solutions to improve the quality of coffee exported to the German market (W2 + O4)...73

5.2.2. Diversify product structure and aim for high-value-added coffee (S1,S4, O1). 755.2.3. Promoting trade, promoting distribution channels to the German market (W5.O2,T2,T3)...75

5.2.4. Improving the quality of infrastructure, investing in transport for import and export. (W3.W4,O3)...76

5.2.5. Time to implement the strategy...77

APPENDIX 01: EXPERT INTERVIEW SHEET...80

APPENDIX 02: SCORES OF EXTERNAL FACTORS...83

APPENDIX 03: SCORES OF INTERNAL FACTORS...84

REPORT TURNITIN...85

</div><span class="text_page_counter">Trang 9</span><div class="page_container" data-page="9">

<b>LIST OF SCRIPTS</b>

EVFTA European-Vietnam Free Trade AgreementFDI Foreign Direct Investment

VICOFA Vietnam Coffee - Cocoa Association

USA United States of America

CPTPP Comprehensive and Progressive Agreementfor Trans-Pacific Partnership

</div><span class="text_page_counter">Trang 10</span><div class="page_container" data-page="10">

<b>FIGURE CATEGORIES</b>

Figure 3.3.1: Research process:...18

Figure: 4.3.1: Vietnam's German goods turnover in the period of 2010-2020 (billion USD unit)...46

Figure 4.3.1a: Coffee value chain in Germany...51

Figure 4.3.1b: Coffee market segment in Germany...52

Figure 4.3.1c: Commercial structure of German coffee...53

</div><span class="text_page_counter">Trang 11</span><div class="page_container" data-page="11">

<b>TABLE CATEGORIES</b>

Table 3.2.4: EFE matrix model...15

Table 3.2.5: IFE matrix model...17

Table 3.2.6: SWot...19

Table 4.4.1a: Vietnam's coffee export turnover to Germany in the period of 2015-2019....45

Table 4.4.1b: Vietnam's coffee export figures to The German market in 2020...45

Table 4.5.5: EFE matrix...54

Table 4.5.6: IFE matrix...55

Table 5.2: Implement the strategy through the use of Swot matrix:...56

</div><span class="text_page_counter">Trang 12</span><div class="page_container" data-page="12">

<b>CHAPTER 1: INTRODUCTION.</b>

<i><b>1.1.Background of the study.</b></i>

Vietnamese farmers have grown coffee for a very long time. Since 1857, coffeeplants have been grown in Vietnam, initially in a few churches in Ha Nam, Quang Binh,and KonTum. However, it wasn't until the early 20th century that French plantationowners began planting coffee plants on a sizable scale in Phu Quy-Nghe An, followedby Dac Nong and Lam Dong, but the total area cultivated was only a few thousandhectares. After more than a century of ups and downs, coffee trees are now foundpractically everywhere in the nation, and the manufacturing of coffee has grown toconstitute a significant sector of the national economy.

Currently, coffee is grown on more than 571,000 hectares in our nation, employingclose to 1 million people. Vietnam produced 1,760,000 tons of coffee in 2012,generating $2.3 billion in sales. Despite being a late-developing nation, Vietnam'sstanding in the global coffee market is steadily improving, with the World CoffeeCouncil and many consumers giving it excellent marks for its natural quality flavor (onpar with Ugandan coffee and higher than many other nations). One of our country's topten exports, coffee has grown to be one of the most significant industrial products, is theprimary export from the agricultural sector, and has the second-highest export turnoverafter rice.

Vietnam, the new king in the coffee sector was the subject of an article that appearedin the August 2013 issue of Le Point magazine (France) and was concerned with thestate of coffee exports from Vietnam. This publication claims that Vietnam is currentlythe world's second-largest coffee grower after Brazil and the primary supply to France.Statistics indicate that, while ranking second in terms of exports to the global market,Vietnamese coffee is disadvantageous since it mostly exports raw beans with little addedvalue to other countries. According to VICOFA, the average cost per ton of processedcoffee is close to $3,600, but the cost per ton of unprocessed coffee is just approximately$2,400.

Vietnamese businesses have taken note of this and are increasing processing laterrather than in the actual and dangerous coffee export scene because they are

</div><span class="text_page_counter">Trang 13</span><div class="page_container" data-page="13">

"retrograde." As Vietnam increasingly expands its international market penetrationthrough the signing of free trade agreements like the CPTPP and EVFTA, roasted anddissolved coffee exports, which currently make up 9.1 percent of the market, arecreating numerous opportunities as well as promising futures for the coffee industry.Particularly, EU nations drink the most coffee, making about 40% of the overall volumeand 38% of the entire export turnover. Southeast Asia came in second with 13%.Vietnamese coffee, in particular, has contributed more than 30% of the volume of coffeeimported into China, the world's most populated country, including roasted coffeebeans...

However, of the roughly 1.5–2 million tons of coffee shipped annually, only a smallportion is sent as processed coffee. Due to this, Vietnamese coffee is "double"disadvantaged in terms of brand value and the size of export turnover.

Vietnamese coffee is mostly sold in the United States, the European Union, Japan,and Korea. With 191,644 tons, valued 358,821,179 USD, down 22.91 percent in volumeand 28.63 percent in value, Germany is currently Vietnam's top coffee market.

Vietnamese coffee exports to the German market are benefiting but also facing somechallenges as a result of Vietnam's WTO membership and the unpredictable economicoscillations that have followed the global economic crisis, which has affected bothGermany and Vietnam.

The economic leader of the European Union (EU) is Germany. Trade ties betweenVietnam and Germany have grown rather rapidly over time. The volume of tradebetween Vietnam and Germany has significantly increased, particularly between 2010and 2013. Nearly 7.7 billion USD was generated in two-way import and export turnover,an increase of more than 7.5 times. The overall import and export turnover between thetwo nations in the first seven months of 2014 also reached 4.191 billion USD. Vietnamspecifically sold goods worth roughly USD 1.5 billion to Germany.

The coffee market has faced two challenges in 2020: the covid-19 pandemic expandsglobally, causing many economies to freeze, and a drop in coffee demand. The price ofcoffee has not yet recovered from the crisis lasting four years. Vietnam has not exceeded

</div><span class="text_page_counter">Trang 14</span><div class="page_container" data-page="14">

a 3 billion USD export turnover for the past two years. Only 139,000 tons of coffee wereexported by the nation in December 2020, a decrease of 26.06 percent from the sametime in 2019. Vietnam exported 1.56 million tons of coffee for US$2.74 billion in 2020,a decrease of 4.22 percent in value and 5.61 percent in volume from the previous year.Additionally, Vietnam boosted its domestic production and exports of processed coffee(including roasted and dissolved) by nearly 12% in 2020.

Vietnam will produce 30.2 million bags of coffee in the 2020-2021 season, down 3.5percent from the 2019-2020 season, according to the US Department of Agriculture(USDA) (60 kg each). The Vietnam Coffee and Cocoa Association estimates that theconsequences of the October floods and the May and June drought will cause a 15%reduction in coffee production in the 2020-2021 growing season. Therefore, the VietnamCoffee - Cocoa Association's anticipated output decline for the 2020-2021 season isgreater than the USDA's. Currently, harvesting for the 2020-2021 coffee season hasreached 60–70% of total production.

Commenting on the coffee export market in 2021, the Department of AgriculturalProduct Processing and Market Development said that in the first months of the year, thecoffee export market has many optimistic signals when coffee inventories at portsaround the world have fallen to the lowest level in many years. Additionally, it willincrease exports with information on vaccination testing. It is significant that the demandfor home-soluble coffee is rising in the context of Vietnam's major coffee importmarkets being affected by the Covid-19 pandemic and continuing to enforce high socialdistance, and that Robusta coffee exports are projected to rise as a result. Additionally,Brazil enters the "two-year one" cycle, or the year of low production, in 2021. The2020–2021 season is expected to see a shortage of roughly 8.5 million bags of arabicacoffee due to persistent dry weather that are harming the growth of coffee plants.

In addition to encouraging signs regarding market demand, coffee prices areanticipated to rebound in 2021 as a result of reducing production and a four-yeardownward cycle.

The Free Trade Agreement between Vietnam and the European Union (EVFTA),which went into effect on August 1, 2020, abolished tariffs on all coffee goods to 0%, is

</div><span class="text_page_counter">Trang 15</span><div class="page_container" data-page="15">

another helpful element and additional potential for coffee exporters. In addition, thereare geographical indications about coffee among the 39 geographical indications ofVietnam that the EU committed to when the EVFTA went into effect. With competitionin the EU market, this will be a huge competitive advantage for Vietnam's coffeebusiness. Vietnam's main coffee consumer market at the moment is the EU, whichaccounts for 40% of total volume and 38% of overall export revenue (the average valueof coffee exports to the EU reached 1.2-1.4 billion USD per year in the past 5 years).

In addition to the positive signs, there will be challenges for coffee exports in 2021,including: Due to a lack of export containers, prices are anticipated to rise in the nearfuture. Exports of coffee are being significantly impacted by this. Vietnam will also haveto contend with competition from other exporting nations, particularly Brazil. Vietnam'scoffee exports will face challenges as a result of Brazil's production of coffee, which isthe largest producer of coffee in the world.

In addition to challenges on the export market, the Vietnamese coffee industry alsofaces internal challenges, such as: Low and unstable business efficiency; completereliance on coffee exchanges by purchasing, processing, and exporting enterprises; Lowadded value in the structure of Vietnamese coffee products; Vietnamese coffee brands'performance in the international export market for processed coffee has fallen short ofexpectations; coffee plant deterioration is accelerating quickly; Climate change hasseveral negative effects on coffee production.

Since then, it has been clear that there are numerous flaws in the Vietnamese coffeeproducing and trading industries. On November 12, 2013, Vietnamese coffee exportedto London was only offered at $ 1,468 per ton - the lowest since June 15, 2010,according to Reuters data, causing great harm to producers, coffee exporters, andnational interests. The export price of coffee is frequently lost, only 70-80% of the priceof coffee of the same type on the world market. Given Germany's significant marketshare in the coffee industry, there has to be effective and quick solutions to increasecoffee exports in the upcoming years.

<i><b>1.2.Problem statement</b></i>

</div><span class="text_page_counter">Trang 16</span><div class="page_container" data-page="16">

I made the decision to research the project "The existing state of Vietnam's coffeeexports to the German market in period of 2011 to present - options to improve exportstill 2020" for the aforementioned reasons.

Through this project, I also hope to be able to put the knowledge I have learned intopractice, comprehend the current situation, benefits and drawbacks of exporting coffeefrom our nation to the German market, and simultaneously suggest helpful and doablesolutions to promote exports and improve the image of the coffee brand. In the eyes ofinternational allies, Vietnam.

In order to prevent deforestation to grow coffee while prices are high, thegovernment decided to stabilize the coffee-growing area at 500,000 hectares in recentyears. Vietnam currently exports more coffee than any other country in the world,second only to Brazil. Its exports of coffee account for around 14% of the world market.

Germany is the EU's largest coffee trading country, and there are numerous coffeeroasters as well as significant coffee importers there. Among them are the three biggestimporters of German coffee: Neumann Gruppe, Volcafe - Man*F Man, and Ecom. Thisis because the climate in Germany is unsuitable for growing coffee.

With the desire to find a solution to help boost coffee exports and find solutions tothe difficulties facing the coffee market, I decided to choose the theme: Strategy topromote coffee exports to the German market by 2022-2030.

<i><b>1.3.Research Objectives</b></i>

My graduation thesis's subject is "The status and solutions to enhance Vietnam'scoffee exports to the German market." The Vietnamese people no longer find coffee tobe all that weird, and it is also a common good in Europe, particularly Germany, whichhas the capacity to consume more of this agricultural product.

Understanding the state of Vietnam's coffee exports generally, and to the Germanmarket in particular, is the research topic's goal (in terms of data and fluctuationsexpressed through secondary data). Determine the current coffee exporters' strengths andshortcomings. Clearly state the benefits and challenges of coffee exporting to the

</div><span class="text_page_counter">Trang 17</span><div class="page_container" data-page="17">

German market. Determining the current state of Vietnamese coffee exports to theGerman market in 2018–2021 is our next step.

Since then, using the learned knowledge, providing fresh, workable ways to addressdeficiencies, highlight strengths, and lessen challenges and risks, some strategicproposals have been made to support Vietnam's coffee exports to German marketing in2022–2030. By doing so, it is possible to learn how to gather data, comprehendstatistics, combine information, and get more familiar with the field.

Studying and offering ways to encourage the export of Vietnamese coffee to theGerman market is the primary goal of the topic. In order to achieve this, the topic willaddress fundamental issues including learning about the theoretical underpinnings andorganizing the typical issues with coffee exports. Let's examine and assess the currentscenario with regard to exports and initiatives to encourage Vietnam's coffee exports tothe German market. then come up with strategies to encourage Vietnamese coffeeexports to Germany. The next step will be to put the knowledge you've learned intopractice in a flexible and proactive manner.

<i><b>1.4.Research Object and scope</b></i>

Time: Situation from 2018 to 2022 and solution to 2025- 2030.

Space: Coffee production and export in Vietnam.

The scope of research on this topic is quite wide with the period from 2022-2030,through which we can refrain from receiving the development process and thefluctuations of the coffee export market in Vietnam are clearer and more accurate. Thestructure of the thesis is presented in the following composition:

 Chapter 1: Introduction. Chapter2: Literature Review. Chapter 3: Methoddology.

 Chapter 4: Environmental Analysis.

 Chapter 5: Some Strategic Recomendation for Promoting Vietnam’s CoffeeExport to German in 2022-2030.

 Conclusion.

</div><span class="text_page_counter">Trang 18</span><div class="page_container" data-page="18">

I used a variety of fundamental research techniques to better comprehend thissubject, including synthetic, statistical, and comparative methodologies. Chapter 3 willprovide a thorough introduction to these techniques. In order to clarify theoretical issuesand the export status of Vietnamese coffee to Germany, statistical and analyticalapproaches are utilized. Comparative methods are then used to further illuminateVietnam's position and draw conclusions in each unique circumstance. In addition, Ihave acquired knowledge over years of training and research that forms the theoreticalfoundation and insights for the paper. In addition, the research from many other sourcessuch as books or official websites of the Ministry of Economy, Import and Export ...information from the official newspapers of Vietnamese enterprises.

</div><span class="text_page_counter">Trang 19</span><div class="page_container" data-page="19">

<b>CHAPTER2: LITERATURE REVIEW2.1.General concept of strategy.</b>

The process of determining an organization's fundamental long-term goals, selectingcourses of action, and allocating the resources required to achieve those goals is knownas strategy. According to this definition, strategy is a procedure with content thatestablishes and guarantees supply and demand as well as important regulations that mustbe followed when employed for coffee exports. A strategy is officially described as abroad plan or organizationally focused action scheme that is directed toward the desiredaim.

Each business's existence and growth are largely dependent on its business plan. Theappropriate business strategy will give your company a positive direction, and you canthink of it as a map that will help your company move in the right path. The fact thatthere are many traders nowadays is due to their successful business strategies, whichenable them to outperform rivals and carve out a niche for themselves in the industry.

Business strategy has many advantages for the company, as evidenced by thefollowing factors:

operational approach with a long-term perspective and a strong foundation. Thereare arguments that will cause the action to be disoriented in the lack of a plan or in thecase of a poorly defined strategy, causing one to view only the local without taking thebigger picture into account. Both internal and external forces are always influencing thebusiness's operations. Therefore, by analyzing and projecting the business environment,the business strategy aids companies in directing their operations in the future. Businessstrategy enables organizations to be adaptable and proactive in response to marketchanges while ensuring that organizations function and grow in the proper way. That cansupport companies in their efforts to improve their market position.

Establish a foundation for firms to actively build environment-friendly businesspaths based on seizing opportunities, avoiding risks, and highlighting competitiveadvantages. Businesses can better understand opportunities as well as any potential

</div><span class="text_page_counter">Trang 20</span><div class="page_container" data-page="20">

hazards to the growth of their resource base with the use of business strategy. It aidscompanies in taking use of resources and using them responsibly, strengthening the firm.

The strategy establishes an operational course for the company, assisting it inconnecting people with diverse interests in order to further its shared goals. It forges tiesbetween workers and between managers and workers. so, enhancing and strengtheningthe company's internal strength.

Establish a strong foundation for research and implementation efforts, investments inhuman resource development, training, and nurturing. In fact, the bulk of errors thatresult from investment and implementation studies are caused by a failure to identify ora diversion from strategic objectives.

Business strategy is a powerful instrument for competing well. The effects ofeconomic integration and globalization on corporate operations have increasedinterconnectedness and impact. This practice has made enterprises in the marketcompete fiercely with one another. Businesses employ business strategy as a powerfulcompetitive tool in addition to aspects like price, quality, advertising, and marketing thataffect competition.

<b>2.2.Export concept.</b>

Depending on the circumstances and each author's point of view, there are manyvarious notions about exports, some of which may differ from one another. Here are afew illustrations of the export concept I have studied.

The Vietnam Trade Law of 2005's definition of export is the first.

The purchase and sale of international goods is carried out in the form of export,import, temporary import, re-export, temporary export, and transfer, per Clause 1,Article 27 of the Trade Law (2005).

In accordance with Clause 1 of Article 28 of the Trade Legislation of 2005,exporting products entails moving them outside of Vietnam's borders or storing them indesignated places on Vietnamese soil that are treated differently from other areas underthe law.

</div><span class="text_page_counter">Trang 21</span><div class="page_container" data-page="21">

The second definition reads, "Export is the sale of goods and services to foreigncountries in overseas trade activities."

The subsequent definition: "Exports (sales) and imports are two ways that countriesexchange products and services internationally (buys).

The subsequent description: "Export refers to the sale of products or services toanother nation for payment in their local currency. Exports are a key component ofinternational trade. Exports occur on a global scale in all economic sectors, including arising amount of intangible goods as well as tangible goods. after studying and using thedefinitions of exports listed above as well as additional definitions. The term "export"can be broadly defined as follows:

"Exports are business operations, but the reach of a business extends beyond nationalboundaries or transnational trade. It is a system of intricately planned trade contacts thattake place both domestically and externally with the goal of advancing the production ofdeveloped commodities, changing the economic system, stabilizing, and progressivelyenhancing the economic well-being of the populace. Exporting goods and services cangreatly increase the profitability of domestic production. Because they must deal with anexternal economic system that domestic actors participating in exports find difficult tosimply control, commercial activity like exports can have negative repercussions.

</div><span class="text_page_counter">Trang 22</span><div class="page_container" data-page="22">

<b>CHAPTER 3: METHODDOLOGY.3.1.Research models:</b>

1Figure 3.3.1: Research process:

<b>3.2.Data collection methods:3.2.1. Secondary documents</b>

Researching strategies to promote Vietnam's coffee exports to TheGerman market.

Theoretical basis

Data collection

RESEARCH RESULT AND CONCLUSION

Analysis of the internal

environment^{Vietnam's coffee exports to}_{the German market}^{External environmental}_analysis

SWOT MATRIXStrategic proposals

</div><span class="text_page_counter">Trang 23</span><div class="page_container" data-page="23">

Secondary documents are documents that provide general information on thetheoretical and practical basis of Vietnam's coffee exports to the German market.Information about localities... This information is based on the study and inheritance ofthe research results of works published at home and abroad in the field of research,through economic reports - associations of coffee production areas, assessments of theMinistry of Agriculture and the Ministry of Economy, ...

Secondary materials collected by us from books, newspapers, magazines, theinternet, related studies; Data from the National Ministry of Economy.

<b>3.2.2. Primary documents</b>

Primary data is an assessment survey questionnaire collected from administratorsand employees in the coffee export of some regions and countries. Besides, there are alsosome interview results experts in the field of international trade, agricultural export, …their evaluative views on the field of study.

In order to study the content of the dissertation topic mentioned, the authorconducted an investigation.

directly experts.

- Determination of investigative sample capacity.

For experts: selection of 5 qualified specialists in international trade, agriculturalexport.

The questionnaire is designed in 3 steps:

Step 1: Rely on the theoretical basis and previous related studies to create shouldinitial questionnaire.

Step 2: The initial questionnaire is consulted with the instructor and some surveysubjects to adjust accordingly and easily understand.

Step 3: The questionnaire is completed and sent to the survey.

- Conduct emailing to survey subjects stating the article requirements.accompanying content for answering questions. In addition, the research outlines anintroduction to the topic is also attached to the questionnaire o serve those wishing tobetter understand the topic as well as the concept used in the questionnaire.

- Call to inform the survey subjects about having sent a letter requesting theinvestigation and asking for permission, asking the interview subjects to cooperate in

</div><span class="text_page_counter">Trang 24</span><div class="page_container" data-page="24">

answering. Calling it is intended to limit the time delay of e-mail messages, as well as tocontribute to motivate interview subjects to quickly answer questions.

- Receive replies and summarize the results of replies via email.

- Conduct face-to-face meetings with some interview subjects if the answers aretheirs is not meaningful or clear enough; moreover, in some cases there are severalarguments interviewees don't have the habit of checking mail regularly, so meeting face-to-face next will help the author gather their opinions.

Preliminary data are figures on the state of Vietnam's coffee exports, includingdata on the status of production, needles and imports of Vietnamese coffee, ...

Primary data is collected by conducting surveys, collecting data, from interviewswith local and regional leaders, ...

Through investigating the areas in the field of exporting coffee agriculturalproducts to the German market, we know specifically about the current state of Vietnam'scoffee production, the difficult advantages encountered, the requirements for exportingcoffee products in Germany.

<b>3.2.3. Research methods:</b>

The research method means that income measures are collected some data:Secondary data will be collected through articles, dissertations or data published fromthe Office of General Statistics of Vietnam from 2018-2021.

Scientific research methods play a very important role. Highly decisive for thesuccess of the research topic. The choice of a method that is not suitable for the field ofstudy will result in the research topic not achieving the end goal.

In addition, choosing a method that is not suitable for the researcher himself alsomakes them more susceptible to fatigue. Much more is pressure, discouragement. In themeantime, you can quit researching the subject.

<b>3.2.4. EFE data analysis method: </b>

The External Factor Evaluation Matrix, or EFE matrix, is described in fullEnglish as a matrix that examines external influences. The EFE matrix is a model thataids in the analysis of the business's external environment at several levels, including themacroeconomic, global, and industrial environments.

</div><span class="text_page_counter">Trang 25</span><div class="page_container" data-page="25">

The strategic planning of the business will know the opportunities and risks thatmay come to their business and make judgments and assessments about the impact ofeach individual factor on the business, including whether it will be beneficial ordetrimental. This will be based on the EFE matrix of leaders.

There will be varying considerations and amounts of research depending on thesize, shape, industry, and market that each business is targeted toward.

We will only take into account the elements that have an impact at the industryand macro level if the business is tiny and only operates in a certain region. Businessorganizations could benefit from less in-depth examination of the global environment,which also takes time, effort, and can result in poor judgment.

Contrarily, if we are a large enterprise, we must carefully analyze the factorsaffecting all three levels of industry, macro, and the world to get the most general view,the most accurate assessment of the impacts, and to identify the great opportunities andchallenges for the business so that there is a development strategy and reasonabledirection.

<i>1-Table 3.2.4: EFE matrix model.</i>

The external factors are mainly Importance Classify Number ofimportantpointsFactor 1

Factor 2…Factor n

* Steps to build the EFE matrix

The EFE matrix is constructed through the following 4 steps:

 Step 1: Identify important factors.

At this step, you need to list from 10-20 factors that play a decisive role in thesuccess of the business based on the assessments from carefully researched data. These

</div><span class="text_page_counter">Trang 26</span><div class="page_container" data-page="26">

factors include both the challenges and opportunities for your company, your businesslines.

 Step 2: Specify the indicator of importance (weighting).

Once you've listed the influencing factors, you'll have to assess the importance ofthese factors to a level of 0 to 1 (not important to very important). This assessment needsto be highly objective, based on actual figures and often worked on the council becauseof its importance.

In order for the data to be most objective, you need to compare the data with thedirect competitors in the industry, both successful and failed businesses. What factorscan cause a business to fail should be evaluated with caution, it cannot be taken lightly.

The importance of the elements may be different or overlapping but must ensurethat the total importance of the elements is equal to 1.

 Step 3: Assess the impact of each factor (Reaction coefficient).

There are important factors that can cause a business it to fail but for your business itmay not have such a strong impact, due to many factors of time, people, modeling,.. Soassessing the impact of each factor on the business is very important.

The level of impact will be assessed on a scale of 1 to 4 corresponding to theimpact levels as:

1- React to a lesser extent.2- Moderate reaction.3- Above-average response.4- React at a good level.

Step 4: Calculate points and total points.

By dividing the importance index by the level of effect, one may calculate eachfactor's relative importance. The importance score of the firm is equal to the sum of theimportant points for each aspect.

</div><span class="text_page_counter">Trang 27</span><div class="page_container" data-page="27">

No matter how many chances or difficulties a company faces, its overall scorecan never be higher than 4.0. We may evaluate your company's responsiveness tocurrent possibilities and challenges using the value of this overall score.

A total score of 1 indicates that the company's business tactics are ineffective,have not been able to address problems, and are unable to seize opportunities.

A total score of 2.5 indicates that the company's policies and tactics are average,have.

A total score of 4 shows that the business is having an effective businessstrategy, making the most of opportunities, and coping with all the challenges that cometo its business.

<b>3.2.5. IFE data analysis method: </b>

It also serves as the foundation for finding and assessing the connections betweenthese sections. Used to describe and assess the important strengths and weaknesses offunctional business units.

The Internal Factor Evaluation Matrix, or IFE matrix in English, measures internalelements.

After taking into account internal factors, the strategic manager must chart thesefactors to take into account the ability to react and recognize the strengths, weaknesses,and goals that the business has set. Internal factors are very important in every businessstrategy and the objectives that the business has set. hence assisting companies inmaximizing their strengths for the sake of exploitation and preparing internal forces toface flaws and come up with strategies to improve these weaknesses.

<i>2-Table 3.2.5: IFE matrix model.</i>

The internal factors are mainly Importance Classify Number ofimportantpointsFactor 1

Factor 2…

</div><span class="text_page_counter">Trang 28</span><div class="page_container" data-page="28">

Factor n

How to build a matrix:

According to Fred R. David, to build the IFE matrix we have to go through thefollowing five steps:

 Step 1: List key success factors as defined in the internal analysis process. Useall (usually between 10 and 20) internal factors, including strengths andweaknesses.

 Step 2: Determine the importance by classifying from 0.0 (unimportant) to 1.0(most important) for each factor. The importance set for each given factor showsthe relative importance of that factor to the success of the company in theindustry. In total all these levels of importance must be equal to 1.0.

 Step 3: Classify from 1 to 4 for each factor representing the greatest weakness(classification by 1), smallest weakness (classification by 2), smallest strength(classification by 3), greatest strength (classification by 4). As such, thisclassification is based on the company while the degree of importance in step 2 isbased on the industry.

 Step 4: Multiply each level of importance of each factor with its type todetermine the number of important points for each variable.

 Step 5: Add up all the important points for each variable to determine the totalcritical points of the organization.

Regardless of the number of elements in the IFE matrix, the overall critical score canrange from 1.0 to 4.0 with an average of 2.5. A total key score of less than 2.5 suggestsan internally weak company, whereas a total key score of more than 2.5 indicates aninternally strong organization.

<b>3.3.SWOT matrix analysis:</b>

The four terms strengths, weaknesses, opportunities, and threats make up theEnglish acronym SWOT. The SWOT model is a technique that aids in giving overviewsfor analysis used in business planning, strategy formulation, competitor analysis,

</div><span class="text_page_counter">Trang 29</span><div class="page_container" data-page="29">

marketing, and the development of new products and services. The SWOT model isfrequently applied at the outset of a company's marketing strategy.

SWOT analysis is crucial for developing the enterprise's production and businessstrategy. SWOT analysis basically entails examining four variables—Strengths,Weaknesses, Opportunities, and Threats—to assist you pinpoint strategic objectives anda direction for your firm.

The entire company, organization, or specific initiatives that the firm isimplementing or plans to adopt can all be analyzed using the SWOT framework. In anutshell, the following elements are included in an enterprise SWOT analysis:

Strengths: Features of a company or project that offer it a competitive edge overrivals.

Weaknesses: The traits of a company or project make it less strong than theirrivals.

Opportunity: It is possible to take use of environmental conditions to youradvantage.

Threats: Environmental aspects can harm a project or business.

<i>3-Table 3.2.6: SWot.</i>

1.2.3.4.

</div><span class="text_page_counter">Trang 30</span><div class="page_container" data-page="30">

*Pros and cons of SWOT model.

Advantages Free: SWOT analysis is a technique for examining the state of acompany's operations or any project it is working on. The two main benefits of SWOTanalysis are the method's effectiveness and cost-efficiency. Important outcomes SWOTanalyses four business-related factors-strengths, weaknesses, opportunities, andchallenges-in order to produce accurate results that would aid in project completion andrisk mitigation. Swot model examination of its four components: opportunities,challenges, strengths, and weaknesses can give businesses new ideas. The modeloutlines the benefits, drawbacks, and threats as well as offers strategies for mitigatingthe worst risks so you can deal with life's challenges more successfully in the future.

Cons Results are superficial: Because swot analysis is so straightforward, theoutcomes do not accurately represent the factors. The results don't offer criticism; theyjust highlight the project's preparation, which is insufficient to finish the evaluation andprovide objectives and directions. More study is required: Since SWOT techniqueprimarily concentrates on studying and analyzing the big picture, a simple SWOT

</div><span class="text_page_counter">Trang 31</span><div class="page_container" data-page="31">

analysis is insufficient to actually produce good results. Personal analysis When makingbusiness decisions, a thorough analysis considers the company's performance as well ascredible, pertinent, and comparable data. SWOT analysis, however, does not accomplishthis; it is insufficient to make any judgments or decisions. All the data obtained is just areflection of the bias of the individuals who carry out the research and analysis. Inaddition, the data used to analyze SWOT is not really true, can be obsolete quickly.

</div><span class="text_page_counter">Trang 32</span><div class="page_container" data-page="32">

<b>CHAPTER 4: ENVIRONMENTAL ANALYSIS.4.1.Business environment between Vietnam and Germany.</b>

<b>4.1.1. Politics, the law.</b>

Regulations on employer regimes, salaries, bonuses, welfare insurance ... The coffeeindustry attracts a sizable workforce, including many different audiences. Therefore, itrequires a diverse salary policy, depending on the participants and each stage of coffeeproduction exported. For coffee growers, it is necessary to have specific policies onprices, protection policies, helping them to be more assured in production. For the staffinvolved in coffee exports, there must be an appropriate salary regime, in addition toproviding the necessary equipment for them to grasp the world market information.

Regulations on coffee export contract transactions: coffee price, quantity of coffee,means of transport used in transactions ... thong is usually calculated according to fobprice, Saigon port when assigning export contracts, vehicles are mainly container ships.Regulations on freedom of trade, construction of strict tariff barriers (whether Vietnamis entitled or not).

Political elements: Political stability is an opportunity to expand the market size aswell as the capacity of the coffee market, but it also has major barriers limiting exportcapacity if the political situation is unstable. Vietnam has relatively stable politicalconditions, so it is not only a good condition to safely produce coffee but also attractsinvestors in the coffee business because this is a stable source for them. The GERMANmarket is politically independent and fairly stable in its strategic policy of economicdevelopment. This will help Vietnam have a stable market.

Thus, legal and political factors are important because if the regulations on theimporting country are not known, the export business unit will face difficulties.

<b>4.1.2. Culture-society.</b>

Different cultures also regulate the import and export of different goods. The cultureof a country is long formed and becomes a habit with the people of that country. Theexport of coffee will bring our culture into the importing country. If we still follow theVietnamese culture, sometimes it is a hindrance to exports to the GERMAN market.

</div><span class="text_page_counter">Trang 33</span><div class="page_container" data-page="33">

Germany highly appreciates the origin of coffee, but in Vietnam, the production ofcoffee is dispersed, the purchase from small units. This is very difficult for Vietnam totake the name of coffee origin. The purpose of export is to meet the needs of theimporting country. Therefore, in order to suit the needs of consumers, it is necessary toknow how to reconcile Vietnamese culture with the national culture of importingcountries. Cultural factors are also influenced by the customs of each country, thatcountry prefers instant coffee, or black coffee, coffee or instant coffee. Therefore, it isnecessary to find out if there is an appropriate export policy.

<b>4.1.3. Economic factors:</b>

Average per capita income growth rate: Income factors, people's standard of living:High living standards people then decide to buy coffee not affected by the change inprices according to the downward trend. Low income is the opposite. The GERMANmarket is a large market with high income levels, cheap prices are not a condition todecide whether to buy or not, but high prices are sometimes a factor in evaluatingproduct quality and purchasing decisions. Vietnamese people are different from cheapprices that are the decisive factor for purchasing. In the production of coffee exports,too, Vietnamese people when there is a decrease in price is to abandon coffee trees toplant other trees. This greatly affects the coffee supply. If the income is stable, thedemand for consumption is regular, then the conditions for production can develop.

<b>4.1.4. Science and technology.</b>

Scientific and technological factors are closely related to economic activities ingeneral and with coffee export activities in particular. Science and technology aregrowing, making the trade between partners more and more difficult. The developmentof the global information network of the Internet, helps all world market information tobe constantly updated and businesses can advertise their products at very little cost.

Equipment is still limited: For coffee exporters such as Vietnam, the cultivation ofcoffee processing lacks modern machinery and equipment, so the quality is notguaranteed, productivity is unstable ... It is difficult to export coffee.

Thus, science and technology development will be an opportunity to createconditions for all industries in general and the coffee industry in particular to be more

</div><span class="text_page_counter">Trang 34</span><div class="page_container" data-page="34">

competitive in the market. But if you do not know how to apply, or the technology inproduction is weak, it will be a major obstacle leading to the lag, not enough ability toimprove the competitiveness in the market.

<b>4.1.5. Natural.</b>

This factor affects the export business. If the resources are large enough, theywill be able to carry out exports. Because exports carry a lot of risks. Each country hasits own advantages in each of its commodities, so the production structures of countriesare also different.

Vietnam has the advantage of producing coffee exports. Natural conditions,combining abundant human resources and coffee production experience of Vietnamesepeople for a long time have given Vietnamese coffee its own taste, conditional to reduceexport costs. This is a condition for promoting the export of coffee.

<b>4.1.6. International competition.</b>

The competition of competitors in the international market is very strong andfierce. Coffee export activities of our country want to survive and develop, a veryimportant issue is to compete with competitors in terms of price, quality, prestige, ...This is a challenge and a major barrier for Vietnam.

Vietnam's competitors for coffee not only have the strength of political economy,science and technology but today the joint venture into large corporations, creating thestrength of monopoly in the market. These economic groups have great strengths andmarket decisions are therefore a huge drag on our enterprises. If not properly organizedexport activities, businesses will be strangled a strong brand, in addition to reasonableprice, increase the quality of coffee cave face. It is a great success for vietnam's coffeecompetition by these corporations. That's why Vietnamese businesses should alwaysknow how to build.

<b>4.2.Coffee export environment in Vietnam.4.2.1. Vietnam's coffee export role.</b>

<i>4.2.1.1.Exploiting advantages and developing domestic economicefficiency.</i>

</div><span class="text_page_counter">Trang 35</span><div class="page_container" data-page="35">

No nation has its own closing policy that has led to economic growth in the modernworld. Each nation needs to take advantage of humankind's economic and technologicaladvancements in order to expand quickly; it cannot rely solely on its own resources. The"open" economy, in which exports play a major role, will offer new developmentdirections to make it easier to take use of any possible advantages the nation may haveand to utilize the global labor market most profitably.

Natural resources and labor are two potential considerations for nations witheconomies that are as underdeveloped as ours. Capital, engineering, markets, andmanagement abilities are the missing components. Exports are a way to make theeconomy more accessible to foreign technology and money, combining them with thenative labor and resource potential to drive the economy forward and close the economicgap with developed nations.

With lower production costs than other coffee-growing nations (Vietnam's December2011 Robusta coffee price was 83.62 US cents per Ib, Brazil's 93.39, Ecuador's 84.14,and the Philippines' 88.40), the advantages of land, climate, and production experiencehave resulted in bumper crops (2011/2012 crop, production reached 24,058 bags, secondonly to Brazil with 43,484 bags). Additionally, there is a stable political and socialsystem, and the Renovation period's strategy is appropriate for creating favorableconditions for Vietnam to enter the global economy, the region in general, and theinternational coffee market in particular.

Vietnam strengthened economic, commerce, science and technology cooperation,and human resource development by formally joining the WTO (World TradeOrganization) on January 7, 2007, and the ICO (International Coffee Organization) onAugust 21, 2011. helping Vietnam grow its market by trading coffee products withnations in the region and around the world (Vietnam shipped raw coffee to 78 countriesin the 2011–2012 season, including the US, Italy, Spain, Indonesia, Japan, Belgium,Algeria, Mexico, and the UK... Germany, in particular, imports the most Vietnameseraw coffee, at 113,000 tons and 231.3 million USD..

<i>4.2.1.2.Create capital.</i>

</div><span class="text_page_counter">Trang 36</span><div class="page_container" data-page="36">

Theories of economic growth and development suggest that there should be fourrequirements for each country's economic growth and development. Exports are anobjective necessity and play a significant role for countries. resources, capital,technology, and human resources. Most developing nations, including Vietnam, lackcash and technology, and the fastest way to acquire them is through internationalcommerce. In support of the nation's industrialisation and modernization, exportsgenerate capital sources for imports. The only surefire way to end historical poverty isthrough industrialisation, but this process costs a lot of money because it needs to bedone in order to import cutting-edge machinery and technology.

Imported capital can be created from the following sources: foreign investment,loans, aid sources, tourism-related revenues, and local services that gather foreignmoney. sources such foreign investment, subsidies, or loans secured by debt There is nodenying their significance, but organizing them is difficult. Additionally, borrowing isfrequently inconvenient and must be repaid afterwards.

As a result, exports are the most significant source of capital since they providethe foundation for imports.

The economy's growth necessitates the importation of more and more industrialmachinery, equipment, and supplies. If utilizing foreign help, loans, or investmentsources, they will have to make payments somehow. Only exporting is the most efficientway to generate imported capital because it requires no additional costs, unlikeborrowing money from abroad, and it also demonstrates the independence of capitalsources. External capital will rise in the future, but all chances for investment andborrowing from other nations and international organizations will only be advantageouswhen investors and lenders recognize the borrower country's export capacity as the mainsource of funds to pay back the debt.

Every year the coffee industry has contributed a large turnover to the statebudget. In 2012, Vietnam's coffee export turnover reached a record 3.67 billion USD,accounting for 3.2% of the export turnover of goods in general.

</div><span class="text_page_counter">Trang 37</span><div class="page_container" data-page="37">

<i>4.2.1.3.Contributing to expanding the consumption of goods, addressingemployment needs and improving people's lives.</i>

Because the domestic market is small and unable to support modern industrial scaledevelopment, mass production does not increase the number of jobs available to people.

Export-related operations provide access to a sizable consumer market with a verydiversified range of needs for all social classes and populations worldwide.Manufacturing has a constant need for laborers, which results in the creation of millionsof jobs for people and helps to reduce unemployment while also raising the country'sincome. Additionally, exports provide money that can be used to buy people's dailynecessities and other critical consumer products.

Vietnam's 2012/2013 coffee exports were 25,475 bags (equivalent to 1,760,000tons of coffee), second only to Brazil (28,333 bags) while Indonesia was only 10,614bags, Honduras was 5,508 bags.

In Vietnam, the Central Highlands in particular, 540,000 farmer households withmore than 1.6 million workers depend mostly on the cultivation of Robusta coffee. Asubstantial quantity of labor has been eliminated in the field of coffee production andmaintenance alone; on average, 1 hectare attracts 1.5 million or more workers, and thisnumber rises during the harvest season. After the coffee supply from the supplier isreceived, other duties, such as buying, reprocessing and sorting, and trading, must becompleted. Additionally, it generates employment for tens of thousands of people.

<i>4.2.1.4.Contributing to economic restructuring, promoting productiondevelopment.</i>

Changing the structure of production and consumption in the most beneficialway is the result of modern science and technology. The economic restructuring in theprocess of industrialization in line with the development trend of the world economy isinevitable for our country. Therefore, exports have an important role for production andeconomic restructuring.

<i>4.2.1.5.Exports create conditions for other industries to have favorabledevelopment opportunities.</i>

</div><span class="text_page_counter">Trang 38</span><div class="page_container" data-page="38">

First of all, the export coffee sector will encourage a number of processingindustries, machinery manufacturing industries, long-distance construction, schools,coffee buying stations, and fundamental building industries. Additionally, there arenumerous service sectors to expand in accordance with: banking, leasing machinery andequipment, pesticides, crop seed delivery services, and... This has the effect of hasteningthe industrialization and modernization process in rural agriculture.

4.2.1.6. <i>Our goods will participate in the competition in the world marketin terms of price and quality. </i>

Due to the competition, we must restructure our production to create a structurethat is constantly market-driven.

Other countries do not have the distinctive natural flavor that distinguishesVietnamese coffee. The distinct flavor of coffee has turned into a benefit for Vietnambecause it is a beverage to be enjoyed, occasionally indicating the class of users.

Vietnamese coffee is always provided at a lower price than coffee from othernations on the global coffee market because of the low cost of manufacturing.

4.2.1.7. <i>Exports create conditions to expand the capacity to provideinputs for production, improve domestic production capacity.</i>

Production operations are connected to the search for export markets. If exportsare profitable, we will have a sizable consumer market. Vietnam now has the initiativein coffee production to meet global consumer demand. The market has more than 78nations that buy Vietnamese coffee, although the EU as a whole and the German marketspecifically represent the country's biggest export markets.

Additionally, the production of export coffee generates conditions that ensureincreased capital, technology, management level, worker quality of life, increasedproduction, and reproductive capacity.

<i>4.2.1.8.Exports create economic and technical premises to renovate andimprove domestic production capacity.</i>

Coffee exports have a significant role in bringing money and technology intoVietnam from the outside world. Vietnam is able to use the most cutting-edge

</div><span class="text_page_counter">Trang 39</span><div class="page_container" data-page="39">

technologies in the world thanks to coffee exports. such as export coffee processingtechnology, drying technology, post-harvest coffee preservation, as well as learningmanagement experience from other nations including Brazil, the United Kingdom, andthe United States... This will raise indigenous production capability to match globalstandards.

<i>4.2.1.9.Exports also require enterprises to always innovate and improveproduction and business management.</i>

The goal of coffee exporters is always market share, which compels companiesto participate in technological advancement, advertising, and global market entry.

With a multitude of high-quality coffee products with illustrious brands likeTrung Nguyen coffee, Vinacafe, Nam Nguyen, and Thu Ha, Vietnamese coffee has aspecial place in the global coffee industry. Trung Nguyen in particular, for instance, inthe event "Creative Festival for Vietnamese Aspirations" – the second time incollaboration with the Central Committee of the Vietnam Youth Union held at TheReunification Palace on November 23, 2013, has created a crowd effect, luring not onlydomestic consumers but also investors, Foreign coffee importers, and other attendees.

as the cornerstone for enhancing and advancing our nation's internationaleconomic ties. Foreign trade and commercial relations have always been depending onone another. Other aspects of the foreign economy, like services, credit relationships,investment, cooperation, joint ventures, and the expansion of internationaltransportation, flourish alongside export operations. In order to improve internationalcooperation, develop our nation's position and role in the world, and maintain thepolitical and economic stability of the nation, export promotion is important.

Vietnam currently exports coffee to 78 different nations, which helps Vietnammaintain numerous connections for development collaboration. Vietnam must fulfill thisrequirement in order to engage in bilateral and international cooperation.

In addition, the growing coffee tree also contributes to restoring the ecologicalenvironment, greening the bare hills after a period of severe degradation due to thedestruction of nature and the destruction caused by human hands

</div><span class="text_page_counter">Trang 40</span><div class="page_container" data-page="40">

<b>4.2.2. Forms of coffee export in Vietnam:</b>

<i>4.2.2.1.Direct export.</i>

Is the export of goods and services produced by the enterprise itself or purchasedfrom domestically produced enterprises, then exported abroad under the name of its owngoods.

Advantages: Because it doesn't have to be split with middlemen, the profit thatthe export business unit obtains is bigger than that of other kinds. Because they aredirect sellers, foreign trade units can also improve their standing abroad.

Cons: It may put enterprises at risk and necessitates huge cash advances forproduction or acquisition of commodities.

Cons: The manufacturer must provide the intermediary a piece of the profits andlimit the relationship with friends of the manufacturer.

<i>4.2.2.4.Export by protocol.</i>

</div>