Thesis NguyenPThao final

ACKNOWLEDGEMENTS
With the permission of Vietnam National University of Agriculture, Faculty
of Accounting and Business Management and Advanced Training Program on
Agribusiness Management. I carried out to implement the Undergraduate Thesis
about: “Current situation of the ceramic product’s consumption in Bat Trang
pottery village”.
If the preparation of the report is a family effort, the quality of the final
product is a reflection of the dedication of all the family members. First and
foremost, I would like to thank to the advice and guidance of Dr. Pham Thi
Huong Diu who had directly guided and provided me with useful advice in
practiced period. Without her, I could not complete my thesis.
Besides, I would like to thank to Bat Trang Commune for giving me
permission to do the internship at the village, providing me with a good
environment and useful data to do the necessary research work.
Last but not least, I highly appreciate the support of our seniors from
Advanced Agribusiness Management batch K55, K56 who had suggested me
much on how to take good advantages of the internship and how to write the
reportwell.
This internship has really given me a lot of precious experiences. After three
months of feeling excited, anxious and satisfactory, I finished my trip
successfully at last.
Hanoi, August 2016
Student
Nguyen Phuong Thao
TABLE OF CONTENTS

i


ACKNOWLEDGEMENTS..................................................................................i
TABLE OF CONTENTS.....................................................................................ii

LIST OF TABLES................................................................................................v
LIST OF FIGURES.............................................................................................vi
CHAPTER 1. INTRODUCTION.........................................................................1
1.1 Rationale of the study........................................................................................1
1.2 Research objectives...........................................................................................2
1.2.1 General objective.........................................................................................2
1.2.2 Specific objectives.......................................................................................2
1.3 Scope of the study.............................................................................................3
1.3.1 Objects of the study.....................................................................................3
1.3.2 Scope of contents.........................................................................................3
1.3.3 Scope of time...............................................................................................3
1.3.4 Scope of space.............................................................................................3
1.4 Research questions............................................................................................3
CHAPTER 2. LITERATURE REVIEW..............................................................4
2.1 The definition, significance and role of the product consumption.........................4
2.1.1 The definition of consumption....................................................................4
2.1.2 The role of consumption..............................................................................4
2.2. The contents of consumption............................................................................7
2.2.1 Market research...........................................................................................9
2.2.2 Formulating strategies and consumption product plans............................10
2.2.3 Research of distribution channels..............................................................13
2.2.4 Promotion policy.......................................................................................16
2.2.5 Implementing product sales plan...............................................................17
2.2.6 Customer service.......................................................................................17
2.2.7 Assessing the product consumption process..............................................18
2.3 Factors affecting the products consumption of craft villages..............................18

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2.3.1 External factors..........................................................................................18
2.3.2 Internal factors...........................................................................................20
2.4 Empirical evidences........................................................................................23
2.4.1 Pottery production in Vietnam...................................................................23
2.4.2 The related studies.....................................................................................26
CHAPTER 3. METHODOLOGIES...................................................................27
3.1 Data collection................................................................................................27
3.2 Data processing and analysis...........................................................................27
3.2.1 Methods of descriptive statistics...............................................................27
3.2.2 Methods of comparison.............................................................................28
3.2.3 SWOT method...........................................................................................28
CHAPTER 4. FINDINGS AND DISCUSSION................................................30
4.1 Characteristics of the study area: Bat Trang Pottery Village...............................30
4.1.1 Geographical location................................................................................30
4.1.2 The history and development of Bat Trang Village...................................31
4.1.3 Status of population and labors.................................................................33
4.1.4 Socio-economic situation..........................................................................37
4.2. Current situation of consumption of ceramic products in Bat Trang village.......38
4.2.1 Results of the ceramic products consumption in surveyed household......38
4.2.2 The situation of consumption by geographic regions................................47
4.2.3. The situation of consumption by customer’s categories..........................51
4.2.4 The situation of consumption by distribution channels.............................51
4.2.5 Market research of households in Bat Trang village.................................54
4.3 Factors affecting the consumption of ceramics products in Bat Trang village.....56
4.3.1 The external factors...................................................................................56
4.3.2 The internal factors....................................................................................61
4.4 SWOT analysis for Bat Trang households........................................................63
4.4.1 SWOT analysis..........................................................................................63

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4.4.2 SWOT strategy..........................................................................................64
4.5 Orientation and solutions to improving the consumption of ceramic product in Bat
Trang village........................................................................................................65
4.5.1 Orientation.................................................................................................65
4.5.2 Solutions....................................................................................................66
CHAPTER 5 CONCLUSION AND RECOMMENDATION............................70
5.1 Conclusions....................................................................................................70
5.2 Recommendations..........................................................................................70
5.2.1 For State Government................................................................................70
5.2.2 For Local Government..............................................................................71
REFERENCES...................................................................................................72
APPENDIX........................................................................................................73

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LIST OF TABLES
Table 4.1 Status of the population- labor of Bat Trang Commune ....................34
Table 4.2 Classification of hiring labors at Bat Trang village in 3 years...........36
Table 4.3 The basic situation of the household surveyed in 2015......................39
Table 4.4 The quantity of main ceramic products in 3 years..............................44
Table 4.5 The price of main ceramic products in 3 years...................................45
Table 4.6 The revenue of Bat Trang ceramic consumption in 3 years...............46
Table 4.7 The quantity of main market consumption in 2015............................48
Table 4.8 The result of ceramic consumption by geographic region in value....50
Table 4.9 The revenue of ceramic products consumption by distribution channels
in 3 years.............................................................................................................52
Table 4.10 The evaluation of customers about Bat Trang products in 2015......55

Table 4.11 Prices of ceramics product in the consumer market.........................59
Table 4.12 The production cost of ceramic products..........................................60
in Bat Trang and Phu Lang.................................................................................60
Table 4.13 SWOT analysis for Bat Trang household’s ceramic production......63
Table 4.14 SWOT strategy for Bat Trang households........................................64

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LIST OF FIGURES
Figure 2.1 Model of product sales........................................................................8
Figure 2.2 Product life cycle..............................................................................10
Figure 2.3 Types of distribution channels..........................................................15
Figure 4.1 The rate of each consumption channels of the households ceramic
production in domestic market in 2015..............................................................52

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CHAPTER 1. INTRODUCTION
1.1 Rationale of the study
Craft village is an important part of our country’s economy and bring
significant benefits to economic and social. The development of the village is an
important contribution in the growth and economic restructuring. Craft villages
is not only contribute to poverty reduction by creating jobs and increasing
incomes for workers, but also the way attracting tourists and foreign. In addition
to socio-economic, the village still preservers the cultural values, flair or skill
crystallized in each product.
According to Ministry of Agriculture and Rural Development, now the
country has about 4800 craft villages. Products of Vietnam craft village is

consumed domestically and exported to over 160 countries with exports
amounted to 1.6 billion USD (2014). Especially export ceramics cover about
488 million USD contributed to income generation for the people change the
rural areas.
“I wish I could marry you/ I will buy Bat Trang bricks to build our house”
are the beautiful folk words honoring Bat Trang ceramic & pottery quality, the
pride of northern Vietnam. Bat Trang, a small village in the north of Vietnam.
Why is its name popular to most tourists to northern Vietnam? The answer is its
ever famous ceramic and pottery products of high quality. If you have known
about Vietnam, you may not be surprised that Bat Trang’s vases, bowls, dishes,
and many other kinds of ceramic products have been exported worldwide. Its
popular foreign markets are Japan (under the brand "Kochi (Giao Chi) ware"),
the Netherlands, Britain, Portugal, Southeast Asia, etc. As time went by, the
village’s products have developed and become well known for the best quality,
style and glaze, both inside and outside of the nation. Many of these are now
customized for aristocratic families and religious needs.

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Each year, the balance problem between production and consumption,
between domestic and foreign consumption. The question is how to villages
arising in the consumption of ceramic products? Accelerate the speed of
consumption, point out the strengths, weaknesses, opportunity and challenge of
villages.
Before the advantages and disadvantages require solution appropriate and
timely to develop the village, promoting the sale of these products village.
Derived from all reason, I decided to choose the topic: “Current situation of
the ceramic product’ s consumption in Bat Trang pottery village ”
Research topic provided a scientific basis for the proposed solution in order

to preserve and developed craft villages preserve traditional culture and
improved life condition for local people to contribute to the strong oil
industrialization and modernization of agriculture and rural development and
international economic integration
1.2 Research objectives
1.2.1 General objective
To discover the current situation of the households’ ceramic products
consumption in Bat Trang pottery village, thereby proposing solutions to
promote the consumption of ceramic products in Bat Trang village.
1.2.2 Specific objectives
o To overview the theory and practice of consumption and ceramic
products consumption
o To study the current situation of ceramic products consumption in Bat
Trang Pottery Village
o To analyze the factors affecting on the consumption activities.
o To propose solutions to boost consumption of ceramic product in Bat
Trang Village with higher efficiency

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1.3 Scope of the study
1.3.1 Objects of the study
Theory and practices related to the ceramic product’s consumption in Bat
Trang village
1.3.2 Scope of contents
Current situation of the ceramic product’s consumption in Bat Trang
Village
1.3.3 Scope of time
The data collected in the period of 3 years (2013-2015)

The final internship is carried out within 8 months, from December 2015 to
August 2016.
1.3.4 Scope of space
The study is conducted in Bat Trang Pottery Village
1.4 Research questions
These research objectives can be specified by several main research
questions:
- What is the theoretical framework of the state of the consumption?
- What is the current of the consumption situation in Bat Trang Pottery
Village?
- What are factors affecting consumption ceramic products?
- What are solutions to ceramic products consumption in the future?

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CHAPTER 2. LITERATURE REVIEW
2.1 The definition, significance and role of the product consumption
2.1.1 The definition of consumption
Product consumption is the value of goods and metabolism
morphological value of goods from goods to money; the product is considered to
consumed when customers accept payment for goods. Product consumption is
the final stage of the process of production and business, are important factors
determining the survival and development of enterprises (Pham Van Duoc, Dang
Kim Cuong 1999). Consumption of products to fulfill the purpose of producing
goods are products manufactured for sale and profit.
In the market economy, every enterprise is an independent economic entity
on their own and must solve three fundamental problems of economic
organization. Profit is the goal of every business survival. Want to be profitable;
enterprise must consume the goods, products suit the needs of the market. To

survive and develop long-term, each enterprise should determine the strategy of
selling products.
Consumption policy-oriented with business objectives and system
solutions, measures to achieve the goal set out in the consumption. The purpose
of the strategy of selling products usually includes: products to consume,
increase sales, maximize profits, expand markets, enhance the reputation of the
business. Product sales strategy of a business help enterprise capture customer
needs, thereby proactively deal with every movement of the market, help
enterprise expand new markets, planning terms sales, revenue, profit,
distribution channels and customers. Product sales strategy plays a significant
role in determining the success or failure of the business strategy.
2.1.2 The role of consumption
Consumption means the direct and final use of goods and services in the
satisfaction of human wants. People many consume such single-use goods as

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foodstuffs, fuel, matches, cigarettes, etc. and durable-use goods such as tables,
scooters, watches, clothes, etc… (Smriti Chand, 2016)
The use of such goods is called unproductive consumption because their
consumption does not help in the production of other goods. Similarly, the
services of doctors, teachers, servants, mechanics, etc. are consumed for
satisfying human wants. The use of such services is called productive
consumption because they help in producing goods and services.
So is the case with machines. There is also public consumption in which
certain wants such as those for education, street lighting, sewerage, or defense
are paid for collectively by the state. But when a person uses goods and services
in satisfying his wants, he does not destroy them in the act of consumption.
This is because man can neither create nor destroy matter. His act of

consumption simply involves the destruction of utilities. But an egg that falls on
the ground or houses destroyed by fire or earthquake, and crops by floods or
drought, and a car smashed “by accident is not consumption because they fail to
satisfy human wants.
Further, all goods and services which are not paid for in their acts of use are
excluded from consumption such as the use of vegetables, fruits or flowers
grown in the kitchen garden, and services of the housewife. To conclude with
Prof. Meyers, Consumption is the direct “and final use of goods and services in
satisfying the wants of human beings.”
The classical economists did not give much importance to consumption,
but the modern economists emphasize much on it and take it as an important
element in economics. Specially Jevons and the economists of his time gave an
important place to consumption. In modern times, consumption is treated as an
inducement on which the economic system of a country rests. The importance of
consumption is explained as under.

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1. Beginning of all Economic Activities
Consumption is the beginning of all human economic activities. A man
feels a desire and then he makes an effort to satisfy it. When the effort has been
made, the result is the satisfaction of the want Consumption also means the
satisfaction of human wants.
A farmer ploughs the land and produces crops laborers work in factories
and produce goods so as to get satisfaction from the consumption of goods. In
fact, the main motto of every productive activity is that people consume goods
and production is done for consumption, which constitute economic activities.
Consumption, therefore, is the beginning of all economic activities.
2. End of all Economic Activities

Consumption is not only the beginning of all economic activities; it is also
the end of all economic activities. Suppose a man is hungry and he starts
preparing his food. Economic activities begin with it. After preparing food,
when he consumes it, all economic activities which were started with the
preparation of food, come to an end. Consumption, therefore, is the end of all
economic activities.
3. Index of Standard of Living
The consumption pattern of a person, i.e., what he eats, what he wears, in
which type of house he lives in, etc. give us the knowledge of the standard of
living of the person.
4. Consumption is the Source of Production
According to Adam Smith, “Consumption is the sole purpose of all
production.” Production increases with increase in consumption. It is consumption of
goods that necessitates their production.
5. Importance in Economic Theory
On the basis of the study of the individual behaviour as regards
consumption, certain laws of consumption have been formulated in economics

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such as the Law of Diminishing Marginal Utility, the Law of Demand, the
Concept of Consumer’s Surplus, etc. In this way, the study of consumption has
contributed much in the formulation of certain economic principles.
6. Importance for the Government
The Government formulates its economic policies on the basis of the
consumption habits of the people. Minimum wages and imposition of taxes are
determined by the government considering the consumption requirements of the
public. From the consumption pattern of the people, the government is able to
know the production of essential and non-essential commodities in the country.

From the analysis of income and consumption, the government is able to know
the saving capacity of the public.
7. Importance in Income and Employment Theory
In modern times, consumption has been given the most important role in the
income and employment theory by Keynes. This theory explains that if
consumption “does not increase the demand for goods will decrease and then
production will fall. It may lead to unemployment. Thus consumption plays an”
important role in the determination of income, output and employment in a country.
2.2. The contents of consumption
Consuming products that require businesses to use overall organizational
measures, the economy and plans to carry out operations related to the sale of
goods such as capture the market demand, production organization, receiving
the product, preparing and selling goods at the request of customers with the
minimal cost of doing business. Thus, consumption of products in the enterprise
is an activity highly professional character, including many different types of
work related to the technical production operations and business process of
organization management consumption. The goal of this process including
market share, sales, revenue diversification, profitability and quality goals,
improve the image of the business and improve customer service.
The manufacturing process of a manufacturing business takes place in a
closed cycle, and the market is the starting point. The market is at the heart of

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the firm, both the objectives and serves its firm. All business activities directed
at the market. Starting organizational apparatus, investment, and technical
infrastructure, improve the quality of products, quality services to the marketing
activities are aimed to meet market requirements best. Businesses can only
survive and prosper when the product or service market now admitted, was done

regarding value, while the market will help businesses recover capital spending,
offset interest charges and have to re-expand production doing. Market connect
production and consumption, producers and consumers. It is an important place
for evaluating, testing, policies, customer reactions.
The process can consume products described in the following diagram:
Market

Market
research

Market
information

Distribution
System
Management

Reserve and
finishing
products
management

Product
and
Service

Sale force
management

Making plan for

consumption

Market

To coordinate
and organize
the
implementation
of the plan

Product
Service

Price
Distribution

Organize sale
& service
product

Fund

Figure 2.1 Model of product sales
(Dong Thi Thanh Phuong, 2005)

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Given modern business, the process of product sales includes the following
principal contents:

2.2.1 Market research
Market research is a way of getting an overview of consumers' wants, needs and
beliefs. It can also involve discovering how they act. The research can be used to
determine how a product could be marketed. Peter Drucker believed market
research to be the quintessence of marketing (1974).
To be successful in the marketplace requires any business that has to do the
exploratory analysis in order to identify the needs that enterprises should meet,
as well as the ability to consume enterprise products on the market. So,
companies can find solutions to adapt to the demands of the market; this is very
important job producing business when a particular commodity.
First of all market research is the identification of market needs, identify
the goods and products that companies need business producers to offer the
highest efficiency. Market research is an important first step for business
operations of any business; it determines the success or failure of business. If a
business accurately identifies market demand, there will be production and
business decisions reasonably bring high economic efficiency, because then the
goods of the consumer business are acceptable. In contrast, when production and
trading a commodity product does not fit the needs of customers, can not be
consumed by the enterprise will be challenging and may fail badly. It means that
'' We have to sell what the market needs, not sell what we have. ''
The contents of market research include:
- Look at the environmental factors to analyze constraints outside the control of
the company as well as the opportunities that may arise.
- Crawl overview of market size through documents mostly statistics on
consumption and sales between market space.

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- Research overview geographical structure, commodity, population distribution

and purchasing power, location and attractiveness, market structure existing
sellers in the market.
- Research and trend dynamics of market movement industry, commodity
groups, the business sector.
2.2.2 Formulating strategies and consumption product plans
Product consumption strategy is oriented operation of the business
objectives and the system of measures to achieve the objective set out in the
consumption. The objective of the strategy of selling includes: consumer
products, increase sales, maximize profits, expanding markets, enhance the
reputation of the business.
Different development stages of a product have various changes in the
number of products.
The concept of the product life cycle:
 Products have a limited life
 Profits rise and fail at different stages of the product life cycle.
 Products require different marketing, financial, manufacturing,
purchasing and human resource strategy in each stage.

Figure 2.2 Product life cycle
Source: The American Economic Review Vol. 86, No. 3

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Table 2.1 Summary of Characteristic, Objectives and Strategy of Product Life Cycle Stage
Critical

Stage
Introduction

Sales

Low

Costs

High cost per customer

Profits

Negative or low

Marketing

Create product awareness and

Objectives

trial

Growth

Maturity

Rapidly rising
Average cost per
customer
Rising

Maximize market share

Decline

Peak sales

Declining sales

Low cost per customer

Low cost per customer

High profits, then lower profits

Declining profits
Reduce expenditure and

Maximize profits while

maintain, reposition, harvest

defending market share

or drop the products

Offer new product
Product

Offer a basic product

features, extensions,

Diversify brand and models

Phase out weak items

service and warranty
Price

Usually is high, use cost-plus
formula

Distribution

High distribution expenses

Advertising

Build

product

Price to penetrate market
Increase number of

distribution outlets
awareness Build awareness

among early adopters and interest
dealers

market

in

the

Price to match or best

Cut price

competitors
Build more intensive distribution

and Street
mass benefits

brand

difference

Go selective: phase out

unprofitable outlets
and Reduce the level needed to
retain

hard-core

loyal

customers

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Product Research
Product strategies are effective ways of doing business, based on
guaranteed to satisfy the needs of the market and customer tastes in each period
of the enterprise business.
Strategic commodities have an important part to be considered the
backbone of the strategy of selling. The higher production level, increasingly
fierce competition, the vital role of commodity products become increasingly
important. Product strategy not only guarantees production and business
activities in the right direction but also inextricably linked to the stages of the
process of reproduction of business expansion to implement the objectives of the
marketing strategy.
Pricing Research
Pricing strategy is to offer the kind of price for a commodity type of
product, corresponding to the market, corresponding to each period to sell the
most and highest rates. Business rates are given to ensure profit maximization
but consistent with consumers and consumer acceptable. Rates will vary
according to the product life cycle, so businesses need to realize precisely to
change the most reasonable.
Although currently on the market, price competition has ceded the
position to compete on quality and service but the prices are still certain
important roles. Price is still important in determining the economic benefit
between the seller and the buyer. If the product strategy that will guide the
production, pricing strategies oriented to consumption.
Pricing strategies have intimate relationships with strategic commodities.
Product strategy is very important though, and has built a thoughtful way will

not provide high efficiency without the price strategy or price strategy carries
many shortcomings.
New businesses established or new market penetration typically applied
pricing strategies to attract customers towards themselves to occupy a market

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share. For Vietnam market, low-income residents, requirements are not highquality products are competitive in pricing strategy is still effective weapon. But
do not be too abusive to compete on price because it can be counterproductive to
harm the business.
2.2.3 Research of distribution channels
What is categorized as a channel of distribution is generally the route
which goods are shipped from the manufacturers and then ultimately to the
consumers (Tybout, A., Calder, B. 2010). In a distribution network system, the
producer places his product directly in the hands of actual users. The cycle of
distribution involves the initial producer, the eventual buyer, and any
intermediaries - to include a wholesaler or retailer (Kotler, P., G. Armstrong, J.
Saunders & V. Wong, 2007).
A middleman is a term that refers to any company or individual in the cycle
which either acquires rights to the goods, deals with price negotiations, or sells
in the same capacity as an agent or broker (Tybout, A., Calder, B. 2010).
Facilitating agencies that assist in functions concerning marketing are not
classified as middlemen in the cycle of distribution.
Intermediaries are used by producers in order to distribute their products to
any given market (Meffert, H., C. Burmann, M. Kirchgeorg, 2008).
The intent of the producer is to establish a cycle of distribution, or often
referred to as a distribution channel, in order to accomplish this goal.
The decision that a company makes, in regards to its proper selection of a
channel, weighs heavily on the outcome of any and all other marketing decisions

made. The strategies, pricing objectives, and distribution processes of a
marketer, who deals with mass producing companies, as apposed to product
distribution to a novelty shop, would reflect stark contrasts. The decision of
which retailers to select, along with certain intermediaries, depends mainly upon
the actual product. The role of the mass merchandiser is to sell middle-priced

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products and simultaneously distribute high-end products to novelty shops, like
a furniture store for example.
The true effectiveness of a firm’s communication and sales prowess falls
largely on the amount of training and motivation is required from the support
channel (Crawens, David W., Nigel F. Piercy, 2009). Acquiring a particular
product may also have a direct correlation to the capabilities of the channel
members themselves. Many companies have often made the mistake of paying
not enough attention to their channels; in the meantime, other companies such as
Apple Inc., UPS, and Merrill Lynch flourish.
Distribution strategies can classify into various categories:
+ Based on sales forms:
Distribution strategy in the form of retail distribution strategy is for goods
and services to final consumers. This strategy by the producer or reseller did.
Distribution strategy in the form of wholesale: the strategic distribution of
goods and services to the buyer for resale.
+ Based on the contact between businesses and final consumers
Direct distribution strategy: the distribution strategy which producers sell
their products won the final consumer without going through any intermediate
stages.
Indirect distribution strategy: the strategy is carried out through some
intermediaries.

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We can be found through the following diagram:

Channel 0

Channe
Channe

Channel 1
Retailers
Channel 2
Wholesalers

Retailers

Consumers

Producers
Agents

Wholesalers

Retailers

Figure 2.3 Types of distribution channels
l3
Source:Channe

/>Channel 1: Direct channel

Channel 2, 3, 4: Indirect channel

The content of the distribution channel
Identify strategic objectives of distribution: distribution strategy has many
different purposes, but there are four main objectives; ensuring rapid distribution;
consume large quantities of products and services, ensuring the quality of goods;
low cost. Depending on the overall goal of the strategy of selling the businesses can
choose one of the primary targets to build distribution strategy.
Selection based distribution strategic:
- Based on the characteristics of the goods can be divided into three
groups: goods involved to preserve damaged roots require direct market access;
single goods; engineering goods have special needs made by direct sale; goods
to sell in bulk through intermediaries.
- Based on customer characteristics: East or sporadic customers,
concentrated or dispersed, stable levels of consumption.

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Identify distribution channels: the important content distribution strategy
is to select the appropriate distribution channel for the characteristics of the
product and customer characteristics so that enterprises achieve strategic goals
distribution.
2.2.4 Promotion policy
It is the primary tool of the marketing mix that enterprise can use to impact
on the target market to achieve the business objectives. The nature of these
activities promote dissemination of products information to convince customers
to buy, so it calls marketing communications activities.

Some types of promotion policy:
Advertisement: Includes all forms of long introduction and promotion of
ideas, goods or services to be performed at the request of the subject advertising
Sales promotion: short-term measure impact on encouraging the purchase
of products or services.
Propagation: the stimulus indirectly to increase the demand for goods and
services or increase the prestige of a business unit by providing meaningful
information about our trade publications in a convenient and free the mass
media.
Personal Sales: the oral introduction of the goods and services seller
through dialogue with one or more potential customers for the purpose of sale.
Enterprises will choose appropriate media and actually by the analysis of
the characteristics of the recipient believe the level of awareness, standards
living, purchasing power .., and enterprise should consider costing of doing
business for this activity after confirming media objectives.
2.2.5 Implementing product sales plan
In fact, the goods are not sold is not only due to the quality and price but
also weakness organizations to consume products. In order to streamline the
activities of consumption, enterprise should follow:
Sellers is the straight person who contacts and communicate with
customers. They have an important role in determining the success of

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consumption process. Besides the distinctive features of the product, the service
style of sellers will make up the company's image, in particular for the products
that are highly competitive with the products of easy replacement. Therefore, the
enterprise should arrange labors who have high qualified professional, skillful
and sensitive to customer psychology. They must have a clear understanding of

the product and attract customers to the unique properties of the product
compared to other products.
Trading and contracting activities: When enterprise sale products in this
form, it help them sell a large volume and build the long-term business
relationship at the same time. Therefore, in the process of signing a contract, the
enterprise need dexterity, agreement flexibility terms that create a relaxed
atmosphere, trust and try to collect more information about the future demand of
customers.
Organization of the distribution network: In essence, the organizational
forms of distribution channels them. The enterprise base on product
characteristics, market conditions to choose the form of a logical channel, low
cost, quick information, and control goods are distributed.
2.2.6 Customer service
The pre-sales services include information services, referrals, introduction,
advertising, join the Expo. It introduces the use of products and services in order
to attach to consumers demand. Therefore enterprise persuades them to buy and
use their products.
The service while selling: the communication services between customers
and enterprise. It includes the introduction of the products, guiding the selection
of products, payment contracting and transportation of the products... Services
impact on the consumer behavior about sentiment the credibility of the
company, the quality, and price of products.
After-sales service: The activities include the installation, repair, warranty,
consumer consultant, former procurement, replacement, and maintenance ...This

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work enhances the reputation of the enterprise, raise the confidence of
consumers when buying and using goods produced by the enterprise.

2.2.7 Assessing the product consumption process
The criteria to assess the effectiveness of consumption product activities of
the enterprise shown by the indicators reflecting the situation of consumption
products. It measures by the volume of product and price.
Analysis of the component to analyze indicator changes not only in
absolute terms but also in structure between the actual parts of the plan, and the
integration of the transformation structure research.
According to the method of consumption, there are many different ways:
Enterprise self-consumption, provided directly to consumers Through the
venture, association, and agent Commercial Affairs for the State. Sold to private
businesses.
2.3 Factors affecting the products consumption of craft villages
2.3.1 External factors
 Political factors
If political and laws clear and stable, it will ensure favorable conditions and
equality for the enterprise to participate in the market competition in a healthy
manner, with high efficiency. Political and law influence directly or indirectly to
the operation of the consumption. There are some types of political factors affect
product consumption such as financial policies, the protectionist policies of free
trade, the views in the field of import, the national program, the regime wages,
benefits and allowances for labors
 Factors on science and technology
Competitiveness in the market or the ability to consume products decides
by quality and price. Science and Technology decided to 2 factors. It applies in

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production contribute to rising the quality of goods and services, minimize
production costs

 The economic factor
The economic factor plays a critical role now, it decided to complete the
formation and business environment and affect the competitiveness of enterprise
in the market. Including the following factors:
- Economic Policy of the State: State Policy support effects or a substantial
barrier to business operations of enterprise
- The economic growth: If the economy is stable and high growth, it will make
income increased. Thereby the purchasing power of goods and services increase too.
- Exchange rate: Local currency decrease prices lead to increased exports. It is
the opportunity for production and higher competitiveness in the domestic
market and internationally. Because of the decreasing in price domestic goods
sold, it compared to foreign competitors
- Inflation: business risk occurs when inflation is very high. When inflation is
high, self-defense business by myself: do not invest in production and business
investment as remanufactured expansion and technological renovation of
production.
 Consumer behavior
Products produced to suit the tastes of consumers; there is such a new
satisfies the needs of new customers eager to speed up consumption. It is also
significant factors to affect demand in the market. Consumers will buy more if
the goods with the tastes and essential to them.
 Competition
Competitive research is to study the competition and set orientation,
remedial measures in accordance with its business.
In general, all businesses are faced with different competitors. Considering
competing viewpoints on 4 levels:

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