Improvement in service quality of duc viet cargoteam forward to the international intergration trend

1

STATEMENT OF AUTHENTICATION
We declare that all materials presented to Solvay Brussels School of Economics
and Management are our own work, gathered, and utilized especially to fulfill the
purposes and objectives of this study and specifically acknowledged wherever
adapted from other sources.

We understand that if at any time it is shown that we have significantly
misrepresented materials presented to Solvay Brussels School of Economics and
Management, any degree or credit awarded to us on the basis of that material may
be revoked.

Academic Tutor

: Asso. Professor NGUYEN MINH HA

Practicing tutor

: Mr. HUYNH MINH NHUT

Class

: MMCoM9

Students

:

DANG THU LIEN

BUI TRINH THAO NGUYEN


2

ACKNOWLEDGEMENTS
Firstly, we would like to use this opportunity to send our sincere thanks to all of our
Professors from Solvay Brussels School Economics and Management who teach
us very dedicatedly and enthusiastically during the time we study in MMCoM9.

Secondly, we would like to express our deep gratitude to our advisor - Professor
MARIANNE CLAES, the Academic Tutor – Asso. Professor NGUYEN MINH HA
and the Practicing Tutor - Mr. HUYNH MINH NHUT for their conscientious
guidance and very detailed instruction.

We also would like to show our gratefulness to the Board of Director, colleagues
and staffs in DUC VIET CARGOTEAM who assist and allow us to use all
materials, documents, data, statistics, images and information of the company for
this project

We are especially thankful to our families for their great support us from the
beginning to the end of the course.

Finally, thanks a lot for the kind contributions from all of the administration people
in Solvay Ho Chi Minh, the MMCoM9 classmates and friends who discuss and
share the valuable ideas with us as well as encourage us to finish this project.

Once again, thank you very much for all your nice assistance, we always keep all
in our heart.

DANG THU LIEN
BUI TRINH THAO NGUYEN


3

EXECUTIVE SUMMARY
The economy of Viet Nam now is integrated internationally. Particularly for
logistics industry, this trend creates opportunities for businesses to export and
import goods with low barriers to entry. However, this leads to the establishment of
new freight forwarders and foreign companies enter Viet Nam’s market easily.
Therefore, the market competition becomes fiercer and Cargoteam has to improve
the service quality forward to the international integration trend to win the market.
This project will investigate the problems that Cargoteam is facing internally and
externally by evaluating the primary data and the secondary data, PEST analysis,
SWOT analysis and Servuction system. On the other hand, five dimensions of
Servqual model will be emphasized during the project to measure the difference
between customers’ expectation and their perception after using service. Basing
on the analysis of these details, there are some problems as followings:
- High competition in the market: customers have various choices in service.
- Employee performance: employee’s knowledge does not meet customers’
expectation.
- Customer turnover: the number of customers left Cargoteam was high.
- Mistakes occurred in working process.
According to the stated problems, the project points out two main solutions and a
recommendation to improve the service quality for Cargoteam:
- Improve employee performance internally and externally: open training courses,
create KPI and quarterly examination to track employee’s knowledge.
- Apply high technology (management software): avoid manual mistakes and
make the working process more accurate and faster.

- Establish an additional service: the consultancy service, specializing in
EVFTA/TPP.
These solutions may take a certain period to come to practical actions because
Cargoteam does need the specific time for training staffs and Cargoteam has to
build the KPI carefully. Moreover, the management software will require the
creators having excellent understanding about the working process of Cargoteam.


4

TABLE OF CONTENTS
STATEMENT OF AUTHENTICATION ........................................................................................ 1
ACKNOWLEDGEMENTS.............................................................................................................. 2
EXECUTIVE SUMMARY ............................................................................................................... 3
TABLE OF CONTENTS ................................................................................................................. 4
CHAPTER 1: INTRODUCTION .................................................................................................... 6
COMPANY OVERVIEW .................................................................................................... 6

I.
1.

Cargoteam’s background information..................................................................... 6

2.

Mission, Objective and Goal ...................................................................................... 7

3.

Milestone ......................................................................................................................... 7

4.

Services availability ...................................................................................................... 7

5.

Market Share................................................................................................................... 8

6.

Cargoteam’s competitor analysis ............................................................................. 8

7.

Financial analysis ......................................................................................................... 9

II. PROJECT FOR THE IMPROVEMENT IN SERVICE QUALITY OF CARGOTEAM
FORWARD TO INTERNATIONAL INTEGRATION TREND ............................................. 10
1.

Reasons for Proposing the Project ........................................................................ 10

2.

Project Objective ......................................................................................................... 10

3.

Research methodology.............................................................................................. 11

4.

Project limitation ......................................................................................................... 11

5.

Project structure .......................................................................................................... 11

CHAPTER 2: LITERATURE REVIEW ...................................................................................... 12
I.

SERVICE QUALITY DEFINITIONS .............................................................................. 12

II.

SERVQUAL MODEL ....................................................................................................... 12

III.

ANALYTICAL METHODS .............................................................................................. 14

1.

PEST Analysis .............................................................................................................. 14

2.

SWOT Analysis ............................................................................................................ 14

3.

Consumer Decision Making Process ..................................................................... 15

CHAPTER 3: ANALYSE THE SERVICE QUALITY OF CARGOTEAM ............................. 17
RESEARCH METHODOLOGY...................................................................................... 17

I.

II.

1.

Secondary Data ........................................................................................................... 17

2.

Primary Data ................................................................................................................. 17
PEST ANALYSIS ............................................................................................................. 23


5

1.

Political .......................................................................................................................... 23

2.

Economic....................................................................................................................... 24

3.

Social .............................................................................................................................. 24

4.

Technology ................................................................................................................... 25

III.

SWOT ANALYSIS............................................................................................................ 25

1.

Strengths ....................................................................................................................... 25

2.

Weaknesses .................................................................................................................. 27

3.

Opportunities ............................................................................................................... 28

4.

Threats ........................................................................................................................... 28

IV. SERVUCTION SYSTEM ................................................................................................. 29

1.

Front stage .................................................................................................................... 30

2.

Back stage..................................................................................................................... 30
SUMMARY OF PROBLEMS THE COMPANY IS FACING ...................................... 31

V.

CHAPTER 4: SOLUTIONS TO IMPROVE SERVICE QUALITY OF CARGOTEAM ........ 33
I.

EMPLOYEE PERFORMANCE IMPROVEMENT ....................................................... 33

II.

INFORMATION TECHNOLOGY ADAPTATION ........................................................ 34

III.

OPEN THE CONSULTANCY SERVICE ...................................................................... 34

1.

Strategy to run consultancy service for Cargoteam .......................................... 35

2.

Key Performance Indicator ....................................................................................... 36

3.

Business Model Canvas for Consultant Service of Cargoteam...................... 37

4.

Key HRM Strategies .................................................................................................... 38

CHAPTER 5: CONCLUSION ...................................................................................................... 39
APPENDIX ..................................................................................................................................... 40
Appendix A. Survey questionnaire ..................................................................................... 40
Appendix B. The survey’s results ....................................................................................... 42
Appendix C. Income Statements of Cargoteam 2012 - 2014 ....................................... 44
Appendix D. Information about EVFTA AND TPP ........................................................... 46
REFERENCE ................................................................................................................................. 52


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CHAPTER 1: INTRODUCTION
I. COMPANY OVERVIEW
1. Cargoteam’s background information
Cargoteam was founded in 1994, being one of the first private Freight Forwarding
companies in Viet Nam by Mr. Paul Guilhem who is French but, was born in Viet
Nam. This year 2016, Cargoteam is honor to hold the 22 Years of Service.

Figure 1. Photo of Mr. Paul Guilhem and Cargoteam’s logo.

-

Company name: DUC VIET FREIGHT FORWARDING SERVICE AND
TRADING LIMITED COMPANY / Trading name: DUC VIET CARGOTEAM

-

Abbreviation name: CARGOTEAM

-

Business field: Forwarding and Logistics

-

Head office: Lot E6, Road K1, Cat Lai Industrial Zone II, Thanh My Loi
ward, district 2, Ho Chi Minh city

-

Telephone: +84 8 3742 3777 - Fax: +84 8 3742 5048

-

Email: / Website:

-

Other offices in: Ho Chi Minh airport, Ha Noi, Da Nang, Laos and Cambodia

Figure 2: Head-office building in Cat Lai, Ho Chi Minh and Map of Cargoteam’s offices


7

2. Mission, Objective and Goal
Mission

Objective

Goal

•Bringing proffessional and dedicated services to customers.
•Being a reliable forwarder in Viet Nam and a responsible
agent/partner in the world.
•Always upgrade and study to serve customers better day
by day.

•Being a profitable leader of the logistics and forwarding
industry in South-East Asia in 2020.

Figure 3: Mission, objective and goal of Cargoteam

3. Milestone
1999
Gained
IATA
licence,
began to
handle

DG

1994
Founded

1996
Opened
Branch in
Ha Noi,
joined in
LINK

2008
Finished
Building
and
Warehous
e in HCM

2000
Opened
Office in
Da Nang

2010
Open
Office
in Laos

2009

Opened 1
more
Office in
Ho Chi
Minh
airport

2012
Open
Branch in
Cambodia

Figure 4: Milestone of Cargoteam

4. Services availability
- Air freight
-

Sea freight

-

Sea-air combination

-

Inland trucking

-

Dangerous goods

-

Project cargo

-

Custom brokerage

-

Warehousing
Figure 5: Helicopter project for the movie King Kong: Skull Island


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 Cargoteam provides various range of service to fullfil the needs of customers.
The most highlighted service is handling dangerous goods, in which there are
few freight forwarders have the legal license to process.
 In general, the services that freight forwarders are providing are similar.
Therefore, to raise the attention from customers, the company has to focus on
improving service quality. In details, improving the performance of sales
personal is the most important. Because they are the persons communicating
directly to customers. Customers’ satisfactions are related to personal
performance.
5. Market Share

Market Share of Cargoteam Handling

15%

10%
5%

25%
45%

South America

Oceania, Africa

Asia

Europe

USA

Figure 6: The market share of Cargoteam handling

The most profitable markets of Cargoteam are export goods to Europe and USA
while import goods from Asia. When EVFTA and TPP are applied, the barriers to
entry will be reduced. Therefore, the market opportunities of these markets will be
more essential.
6. Cargoteam’s competitor analysis
Logistic services in Viet Nam have developed from the decade 1990 starting from
the Freight Forwarding Services and Warehousing. Nowadays, the number of
companies that provide Logistics services is very huge. They are classified into
many different categories as following:

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Number

Category company

Quantity

1

Logistics – Services

295

2

Transport Agents

2,252

3

Freight Forwarding Services

1,895

4

Customs - Services

378

5

Express Services

278

6

Warehouses - Public

138

7

Stevedoring Contractors (Machine)

125

TOTAL:

5,361

Table 1: Total number of companies in transportation (Source: Vietnam Yellow Pages)

Besides the state-owned enterprises to be equitized, the scale of most Logistics
companies are small and medium-sized with the average charter capital about 4-6
billion and the human resources that are trained with the specialize knowledge in

the logistic area is still very low, only approximately 5-7%.
Cargoteam is a medium-sized company but during 22 years from the first day to
run the business, Cargoteam has increased the charter capital into 22 billion VND
since 2015 with much progress:
-

Offices: 6 (Ho Chi Minh: 2, Ha Noi: 1, Da Nang: 1, Laos: 1, Cambodia: 1)

-

Private building: 2,500 m2 and Private warehouse: 2,500 m2 private

7. Financial analysis
The performance of Cargoteam is presented based on the Income Statements

Revenue and COGS 2012-2014
of Cargoteam
54,608,144,717
24,305,554,102
100,000,000,000
50,000,000,000

37,870,307,330

2014

9,136,320,303
20,439,903,468

2013

109,872,000

Revenue

COGS

Figure 7: Revenue and COGS 2012-2014 (see Appendix C)

2012


10

The revenue in 2014 was higher 20 billion VND than the one in 2013. However,
there was a variance between the revenue and the net profit. In details, the net
profit in 2014 was only 6 billion VND. This was caused by high Cost of Goods Sold
(COGS) with 15 billion VND exceeded.
 Overall, the profit margin of Cargoteam was not as high as expected and
the market becomes more competitive even though Cargoteam service is
good and has long commitment with customers. There is a necessity to
innovate the service quality forward to the international integration trend.

II. PROJECT FOR THE IMPROVEMENT IN SERVICE QUALITY OF
CARGOTEAM FORWARD TO INTERNATIONAL INTEGRATION TREND
1. Reasons for Proposing the Project
The competition in Logistics industry in Viet Nam is increasing rapidly recently,
especially when many free trade agreements are established. The appearance
of new freight forwarders in Vietnam and foreign cargo companies create more
competitive pressure on the development of Cargoteam. Moreover, the
financial status of Cargoteam was not good in which the profit was not as high

as expectation. This is caused by the tough market competition. Therefore,
Cargoteam has to focus on improving the service quality forward to global
integration trend in order to compete with other competitors in operation, keep
the relationship with current customers and attract new customers.
2. Project Objective
-

Figure out the problems Cargoteam is facing in the integrated economy
according to five dimensions of Servqual model.

-

Analyze external and internal factors affecting to the development of
Cargoteam through PEST analysis, SWOT analysis and Servuction
system.

-

Investigate customer satisfaction according to the survey’s result.

-

Suggest solutions to improve the service quality of Cargoteam


11

3. Research methodology
-

Secondary data: using data from the reports of Cargoteam about the
number of orders received and the number of customers recent years

-

Primary data: conducting the survey to track the service performance
quality, what customers expect from the company and their suggestion
for development.

4. Project limitation
-

The duration for the project is only three months

-

Information related to logistics industry was only from internet sources

-

The competitor market share information is not clear

5. Project structure
The project will be divided into five main parts:
-

Chapter 1: showing Cargoteam’s introduction and the overview of the
project for improving service quality of Cargoteam forward to the
international integration trend.

-

Chapter 2: presenting theoretical framework (Servqual Model, PEST
analysis, SWOT analysis, Servuction System)

-

Chapter 3: indicating practical analysis of internal and external factors
related to Cargoteam’s activities based on theoretical framework.
Besides, demonstrating the problems Cargoteam is facing

-

Chapter 4: suggesting solutions to improve service quality

-

Chapter 5: conclusion


12

CHAPTER 2: LITERATURE REVIEW
Following are the theoretical framework related to the analysis of Cargoteam
-

Showing definition of service quality and its main characteristics

-

Servqual model helps to evaluate the differences between customers’
expectation and Cargoteam’s service performance

-

PEST analysis shows how external factors affect to Cargoteam and SWOT
analysis points out internal and external factors.

-

Servuction system analyzes the characteristics of front stage (visible to
customers) and back stage (invisible to customers) of Cargoteam’s service.

I.

SERVICE QUALITY DEFINITIONS

Service quality was defined as the distance or differences between customers’
expectation and customer’s perception after experiencing the service (Zeithaml,
V.A., Parasuraman, A. and Malhotra, A., 2000). Besides, Lehtinen, U. and
Lehtinen, J.R. (1991) divided service performance into two approaches. In the first
approach, three quality dimensions are used: physical quality, interactive quality
and corporate quality. The other approach is to utilize two dimensions: process
quality and output quality.
There are three main characteristics of service quality:
-

Intangible product: service cannot be measured or experienced before
purchasing

-

Heterogeneous service: the service suppliers, customers’ requirements and
service process change daily, which is hard to assure the service quality

-

Unseparated connection between service supplement and service
distribution. The interaction among customers and sales persons is
extremely important element to evaluate the service performance.

II. SERVQUAL MODEL
Parasuraman A., Zeithaml V.A. and Berry L.L (1988) stated that Servqual model
was developed to highlights the five dimensions of service quality:


13

-

Reliability: the ability to perform the promised service dependably and
accurately

-

Assurance: the knowledge and courtesy of employees and their ability to
convey trust and confidence

-

Tangibility: the appearance of physical facilities, equipment, personnel and
communication materials

-

Empathy: the provision of caring, individualized attention to customers

-

Responsiveness: the willingness to help customers and to provide prompt
service

Figure 8: Servqual model (source: Parasuraman A., Zeithaml V.A. and Berry L.L 1988)

This model allows customer service experiences to be explored and assessed
quantitatively and has been used widely by service delivery organizations.
Businesses use SERVQUAL to measure the differences between the customer
expectations of service quality in terms of these five dimensions, and their
perceptions of the service they received. When customers’ expectations are
greater than their perceptions of received delivery, service quality is deemed low.


14

III. ANALYTICAL METHODS
1. PEST Analysis
PEST is a scan of macro-environment, which shows how these factors affect the
service performance in long term and help to make critical decisions for the future
growth (Narayanan V. and Fahey L. 1994)
POLITICAL

SOCIAL

Tax policy, Employment laws

Health consciousness

Environmental regulations

Population growth rate

Trade restrictions and tariffs

Age distribution, Career attitudes

Political stability

PEST Analysis

Emphasis on safety

TECHNOLOGY

ECONOMIC

RandD activity, Automation

Economic growth, Interest rates

Technology incentives

Exchange rates, Inflation rate

Rate of technological change

Figure 9: PEST definitions (Source: Narayanan V. and Fahey L. 1994)

2. SWOT Analysis
SWOT is created as a method for evaluating internal (strength and weakness) and
external factors (threats and opportunity). This is also a tool for strategic planning
in the company (Lovelock, Wirtz and Chew 2009)
STRENGTH
Patents, Strong brand names
Good reputation among customers
Cost advantages from proprietary know-how
Exclusive access to high grade resources
Favorable access to distribution networks

WEAKNESS
Weak brand name and patent protection
Poor reputation among customers
High cost structure
Lack of access to the best natural resources
Lack of access to key distribution channels

SWOT Analysis
OPPORTUNITY
An unfulfilled customer need
Arrival of new technologies
Loosening of regulations

Removal of international trade barriers

THREAT
Shifts in consumer tastes away from the
firm's products
Emergence of substitute products
New regulations, Increased trade barriers

Figure 10: SWOT definitions (Source: Lovelock, Wirtz and Chew 2009)


15

3. Consumer Decision Making Process
According to Lovelock, Wirtz and Chew (2009), consumer decision making
process was divided into three stages which are pre-purchase stage, service
encounter stage and post-purchase stage.
Pre-purchase stage

Customer Needs
Awareness
• Customer realize
their arousal
needs
• Take actions for
solutions

Information
Search
• Compare

alternatives in
evoked set
• Review feedbacks

Service
Evaluation
• Service attributes
• Perceived risks
• Customers actions
to avoid risks
• Company solution
to reduce risk
perception

Purchase Decision
• Best options are
selected

Figure 11: Pre-purchase stage (Source: Lovelock, Wirtz and Chew 2009)

Service encounter stage - the Servuction System

Figure 13. The servuction system (source: Lovelock, Wirtz and Chew 2009)

-

Front stage: activities are visible showed, such as personal selling,
reception

-

Back stage: invisible activities to consumers (IT system, operation)


16

Post-purchase stage
Based on the cycle of success, high customer satisfaction leads to employee
satisfaction which causes positive service attitude. Similarly, when the service
quality is better, the turnover will be lower and the customer loyalty increases.
Furthermore, when the customer turnover decreases, the profit margin may
increase.

Figure 13: Cycle of Success (source: MIT Sloan Management Review)


17

CHAPTER 3: ANALYSE THE SERVICE QUALITY OF CARGOTEAM
I.

RESEARCH METHODOLOGY

1. Secondary Data
Secondary data uses the statistics from Cargoteam’s reports:
-

The income statements of Cargoteam from 2012 to 2014 that were audited.

-

The customers’ number of Cargoteam in 3 recent years from 2013 to 2015.

-

The turnovers of Cargoteam for Export and Import in 2 offices Ho Chi Minh
and Ha Noi from 2013 to 2015 that indicates the quantity by TONS, CBM
and TEU (1x20’DC).

2. Primary Data
Using quantitative research: conduct the survey to track the perception of current
customers about the service quality of Cargoteam.
Applying the method K.I.S.S. = “Keep It Short and Simple” to not take a lot of time
for surveyed customers, it only takes them 5 minutes to answer the survey. The
persons who response to the survey are current clients of Cargoteam. They are
director, sales manager, logistics manager, etc., who are working directly with
Cargoteam. The survey is built with 8 questions:
-

The Question 1 to 6: evaluate the Satisfaction of customers for
Cargoteam’s service.

-

The Question 7: focus on the attention of customers for EVFTA/TPP.

-

The Question 8: it’s an open one to get the comments, ideas or suggestions
from customers.

Sample size calculation:
According to Hair (2006), the sample size could be assumed by the minimum
number of sample which is higher than 30. The formula: N = 5*m >= 30
There are 08 questions in the survey, so does m is 8
N = 5*8 = 40 >30
There are 72 responses from customers, which is much higher than the minimum
number of sample size.


18

 All the results from primary data and secondary data will be assigned into
two main parts: business analysis and customer satisfaction
2.1 Cargoteam’s business analysis

6,000.00

5,293.80

5,000.00
4,000.00
3,000.00

3,533.85
2,702.97
1,850.73

2,248.97
2,292.56

1,892.72

1,456.66
832.45

2,000.00
1,000.00

231.98 253.29

564.85

EXPORT

IMPORT

EXPORT

HCM

IMPORT
HA NOI

1/ 2013

2/ 2014

3/ 2015

Figure 14: Total cargoes of Cargoteam calculated by TONS from 2013 to 2015

-

Quantity of Export and Import in Ho Chi Minh office is higher Ha Noi office.

-

Both offices have an increase in 2015 than compared with 2013 and 2014.

-

Quantity of Export in Ha Noi office in 2015 especially gets the rocket due to
the successful contract between Cargoteam with Foxcom Viet Nam who
belongs to Taiwanese Foxconn Technology Group - the world's largest
electronics contractor manufacturing the notable products BlackBerry, iPad,
iPhone…In 2015, Cargoteam was nominated to be the freight forwarder to
transport most cargoes for Foxconn from Ha Noi to USA and EU with daily
booking around 2 to 6 tons per shipment.

 This shows that the service quality of Cargoteam meets the expectation of the
customers then they trust in the reputation of Cargoteam and definitely choose
Cargoteam as the reliable service provider.


19

25,000.00

21,478.34

20,000.00
15,000.00

10,391.02
7,770.15
10,000.00
5,993.70
5,664.60
4,074.86
3,613.03
2,312.97
5,000.001,560.07
309.70 219.96
265.54
EXPORT
IMPORT
EXPORT
IMPORT
HCM

HA NOI
1/ 2013

2/ 2014

3/ 2015

Figure 15: Total cargoes by Cargoteam calculated by CBM from 2013 to 2015
-

Quantity of Export in Ho Chi Minh in 2105 is slightly increased whilst there’s
nearly no change in Ha Noi office.

-

Quantity of Import in Ha Noi office is much higher many times in 2015 than
compared with 2013 and 2014.

-

Quantity of Import in Ho Chi Minh office is much decreased whilst Ha Noi
office has a dramatic increase.

 This shows that Ho Chi Minh office has to double check why customers quit
using Cargoteam in 2015. It means the service quality has any issue due to
rates, operation or other reasons.
2,436.00
2,500.00
2,000.00

1,568.00

1,689.00

1,500.00

1,372.00

856.00

1,000.00

1,192.00

899.00

685.01 727.03

290.00 307.00 352.00

500.00
EXPORT

IMPORT

EXPORT

HCM

IMPORT
HA NOI

1/ 2013

2/ 2014

3/ 2015

Figure 16: Total cargoes of Cargoteam calculated by TEU (1X20’DC) from 2013 to 2015

20

-

Quantity of Export in Ho Chi Minh in 2105 is lower when Ha Noi office
increases a little.

-

Quantity of Import in both offices is decreased in 2015 than compared with
2013 and 2014.



In general, the performance in Ho Chi Minh office is better than in Ha Noi
office. However, the number of cargoes both offices decreased in compare
with the previous years. This is clarified that the increase in number of
competitors are affecting the service quality of Cargoteam very seriously.
2.2 Cargoteam’s customer satisfaction analysis
2.2.1 Results from the survey

Table 2:. Survey’s results about customer satisfaction
80

72

72

72

72

72

70

62

60
50

42

37

29

24
5

27

25

20
10

49

45

41

40
30

72

10
1

23
10

2

0
Question 1
Question 2
Question 3
Question 4
Question 5
Question 6
Very Satisfied
Satisfied
Neutral
Dissatisfied
Total
Figure 17: Customer Satisfaction tracking from Question 1 to 6

21

-

There is high number of clients feeling very satisfied 60.65% and satisfied
27.55% with Cargoteam service because Cargoteam can provide them the
professional, devoted, dynamic and speed service. The working policy of
Cargoteam is to serve clients anytime they need. Therefore, all Cargoteam
staffs always try to adapt the reasonable requests from customers, assist
them and support them even working overtime or reply email in holidays.

-

11.57% of clients giving neutral answer and there is only 1 client
dissatisfied at Cargoteam service due to late sending Delivery Order for her
import shipment.

 In general, this is a very good result and Cargoteam has to attempt to secure
this valuable supports from clients as much as possible. However, Cargoteam
must ask the Import department to fulfill their duty better in future to make
customers happy with Cargoteam service.

80
70
60
50
Question 8

40
30
20
10
0
Commend

Claim rate

Claim OP

Not suggest

Total

Figure 18: Customers’ Comments from Question 8

The comments of customers in Question 8:
-

10 customers praise Cargoteam: they like Cargoteam service, thanks to the
help of Cargoteam staff and encourage Cargoteam to keep going for future
with good characteristics: agile, conscientious and enthusiastic.

-

8 customers claim Cargoteam for offering the more competitive rates of sea
freight, trucking and customs fee or their shipments. Cargoteam must
consider the better rates to get their bookings.

22

-

4 customers claim Cargoteam for ineffective work of the operation staff,
booking to wrong destination or sending documents not quick enough.
Cargoteam must double check with staffs, find the reason and prevent the
same complaint later.

2.2.2 Statistics from the report of number of customers of Cargoteam

Number of Customers 2013 - 2015
1,200

1,016

1,000

802

800
501

600
400
200

282

234

-

387

48 55 57

- 36 15 12 7 51

-

214206
118

182
145
37
38 14
-

114101
40

Freehand Sales
Clients
No. Situation

1 Current using

Nominated Sales
Clients
2 Stop using

3 New customers

TOTAL

4 Loyal customers 3-5 years

5 Total

Figure 19: Statistic and Chart of Cargoteam’s customers from 2013 to 2015

As per the above statistic and chart, we can see Cargoteam has total 1,016 clients
at this moment: 79% clients still support Cargoteam while 21% already left or
stopped due to many objective reasons (bankruptcy, close business, nominated by
the oversea consignee) or subjective reasons (uncompetitive rate, not smooth
operation). However, 26% new clients come to try the services and 15% clients
use Cargoteam from 3-5 years loyally – it’s a satisfactory result to prove that they
use Cargoteam because of the reliable service. Though it’s good, the 21% clients
stop using Cargoteam should be seen as a threat for Cargoteam in which
Cargoteam may lose clients to other competitors. There are several reasons
leading to this matter:
-

Customer service: personal selling is important element in which sellers
directly communicate with customers. The satisfaction of customers may be
lower if Cargoteam responds to customers slowly, replies wrong
information,

sends

quotation

too

late

or

solves

the

problem

unprofessionally. Customers may also leave if Cargoteam doesn’t listen to


23

their requirements and doesn’t show their knowledge of the area that the
customers are mentioning.
-

Price setting: customers may compare the price of Cargoteam to other
freight forwarders, then they could change to those companies if they offer
lower price with similar service. Although the price in the industry is stable
and hard to change, the competitors may offer additional value to the

service to attract customers. Moreover, in special situation, there are extra
costs occurred during the service process and Cargoteam staff forces
customers to pay more than the original quotation, customers will surely
angry. If Cargoteam does not give them a clear explanation, customers may
feel like they are cheated and the service is deception. This result in
untrustworthiness in the service quality and make customers being
dissatisfied, they will run away and never come back.

II. PEST ANALYSIS
1. Political
According to Thien Thuat (2016), Mr. Nguyen Tan Dung - Prime Minister has
stated: the objectives in 2016 are strictly controlling the operational activities of
Freight Forwarders, enhancing the capability of cargo to 7-8% tons, financial
supporting for business in this industry. The infrastructure is the main
concentration recent years. The government gives a lot of supports to renovate the
quality of the infrastructure.
The context of the ASEAN ECG (Economic Community General), TPP (The
Trans-Pacific Partnership Agreement) or EVFTA (European-Viet Nam Free Trade
Agreement), the Logistics industry will be the key role to help Viet Nam integrate
into the global supply chain.
Moreover, the Vietnamese government has released and changed a lot of policies
to develop the Logistics field. New regulations have been applied to encourage the
import-export activities such as the improvement of customs systems:
-

Apply the Single-window Customs Procedures

-

Increase automation to reduce filing papers at customs offices and to

simplify customs procedures


24

-

Use VNACCS/VCIS - the modern systems of Japanese for declaring
customs clearance more quickly and effectively

 Overall, Cargoteam will get some benefits in which the flow of service will be
smooth, the customs procedure will be eliminated unnecessary steps to
shorten time and help forwarders to save a lot of time in the import/export
declaration. The financial supports from Government may also help lower risks
in financial controlling.
2. Economic
Trading activities had strong development which was approximately 20.3% per
year in the period of 1998-2014. Asia is the main market for Vietnam foreign trade,
which was 128.52 billion USD in 2014, took 60% of total import-export turnover
(Tan Si and Trung Hung, 2015).
Vietnamese Freight Forwarders face challenges in competency with foreign firms,
whom take advantages with 82% market shares. Also, the establishment of new
companies in the industry leading to the fact that supplement has exceeded
demand, which cause unfair competition in the market.
 When the number of suppliers increases: customers have various choices in
service performance, price list and additional sources. Therefore, Cargoteam
has to improve the service quality such as service flow performance,
competitive price and value added service in order to secure the current
business.
3. Social

Figure 20:The Age Structure of Vietnam Population in 2014 (source: MIC 2012)


25

People in the age of labor took 58.4% in total population according to the statistics
in 2011 (Ministry of Information and Communication, 2012). There was a trend of
reduce birth rate and increase the duration of life led to extreme change in
population structure. In details, young human resource takes highest percentage
in the total population.
 This fact gives opportunities for Cargoteam to avoid pressure from labor force.
The supply of human resources increase, Cargoteam could

recruit

experienced and good employees, in which secure the standard performance
of service.
4. Technology
Technology is developing rapidly to fulfill the requirements of users. There are a lot
of software created to help business improve management. Businesses may
purchase the software from external companies, or build their own management
system.
 Cargoteam should take advantage in the technology development to enhance
the management system. This helps avoid mistake in working process, which
gains the reliability from clients and speed the process to promote the
responsiveness.
III. SWOT ANALYSIS
1. Strengths
Cargoteam has long experience in logistics industry and high quality facilities

supplement such as 6 offices in Viet Nam, Laos and Cambodia, 2,500 m2
warehouse and 2,500 m2 office building in Cat Lai. These factors help Cargoteam
gain trust and reliability from customers. Furthermore, sea-air combination and
dangerous goods are the special services that make Cargoteam differentiated
from other competitors.