Improve the competitiveness of newland invest joint stock company = nâng cao năng lực cạnh tranh của công ty cổ phần đầu tư newland

ĐẠI HỌC QUỐC GIA HÀ NỘI
KHOA QUẢN TRỊ VÀ KINH DOANH
---------------------

GIÁP VĂN TIỆP

IMPROVE THE COMPETITIVENESS
OF NEWLAND INVEST JOINT STOCK COMPANY

NÂNG CAO NĂNG LỰC CẠNH TRANH
CỦA CÔNG TY CỔ PHẦN ĐẦU TƯ NEWLAND

LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH

HÀ NỘI - 2018


ĐẠI HỌC QUỐC GIA HÀ NỘI
KHOA QUẢN TRỊ VÀ KINH DOANH
---------------------

GIÁP VĂN TIỆP

IMPROVE THE COMPETITIVENESS
OF NEWLAND INVEST JOINT STOCK COMPANY

NÂNG CAO NĂNG LỰC CẠNH TRANH
CỦA CÔNG TY CỔ PHẦN ĐẦU TƯ NEWLAND
Chuyên ngành: Quản trị kinh doanh
Mã số: 60 34 01 02
LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH

NGƯỜI HƯỚNG DẪN KHOA HỌC: TS. TRẦN HUY PHƯƠNG

Hà Nội - 2018


DECLARATION

The author confirms that the research outcome in the thesis is the result of
author’s independent work during study and research period and it has not yet
published in others’ researches and articles.
The others’ research results and documentations (extractions, tables, figures,
formulas, and other documents) used in the thesis were cited properly and the
permission (if required) was given.
The author is responsible in front of the Thesis Assessment Committee,
Hanoi School of Business, and the laws for above-mentioned declaration.
Date…………………………..


ACKNOWLEDGMENTS

Throughout the process of study, research and thesis conduction, the author
have obtained a great amount of valuable and useful knowledge from the training
programme, the consideration and support from the teachers, the Board of Leaders
of Newland Investment Joint Stock Company and the co-workers in the company.
With all the heart and the gratitude, the author is sincerely thankful to the
teachers of the Vietnam National University, Hanoi, especially PhD. Tran Huy
Phuong who have spent great time and effort giving whole-hearted guidance and
support with valuable comments for the thesis to be completed better.
The author would like to express the gratitude towards the Board of leaders

and the co-workers of New Land Investment Joint Stock Company where the author
is working for creating favourable conditions, providing assistance in terms of
timing, providing data and information for the author to finalize the thesis.
The author owes deeply all the friends and family for their support during the
period of researching for the thesis.
Author

Giap Van Tiep


TABLES OF CONTENTS

LIST OF ABBREVIATION ..................................................................................... i
INTRODUCTION .....................................................................................................1
CHAPTER 1: BASIC ISSUES ON COMPETITIVENESS AND EXPERIENCE
TO ENHANCE COMPETITIVENESS OF THE ENTERPRISE ........................11
1.1. Competition and roles of competition in a enterprise ..............................11
1.1.1. Concept and classification of competition ...........................................11
1.1.2. Roles of competition .............................................................................14
1.2. Competitiveness and the necessity to promote the competitiveness of the
enterprise .............................................................................................................16
1.2.1. Concept of competitiveness of the enterprise .......................................16
1.2.2. Characters of enterprise’s competitiveness .........................................18
1.2.3. Criteria to evaluate enterprise’s competitiveness ................................19
1.2.3. Elements affecting the competitiveness of the enterprise.....................25
1.2.4. The necessity of the enterprise’s competitiveness ................................35
1.3. Experience withdrawn in promoting competitiveness of a number of
enterprises and the lessons .................................................................................37
1.3.1. Experience of competitiveness promotion of a number of enterprises ......37
1.3.2. Lessons for Newland Investment Joint Stock Company .......................41

1.4. Thesis research model .................................................................................42
CHAPTER 2: CURRENT SITUTAION OF THE COMPETITVENESS OF
NEW LAND INVESTMENT JOINT STOCK COMPANY ...............................43
2.1. Overview of the business activity operation of the Newland Investment
Joint Stock Company..........................................................................................43
2.1.1. History of the establishment, development, organization and business field 43
2.1.2. Business activities of Newland Invest., JSC. in the recent time ...........45
2.2. Newland Current situation of competitiveness of Newland Investment
Joint Stock Company..........................................................................................47
2.2.1. Analysis of the competitiveness criteria of Newland Investment Joint


Stock Company ...............................................................................................47
2.2.2. Elements affecting competitiveness of Newland Invest., JSC ..............57
2.3. Evaluation of competitiveness of Newland Invest., JSC. .........................70
2.3.1. Evaluation of competitiveness of Newland compared to competitors on
the target market ............................................................................................70
2.3.2. Achievements ........................................................................................71
2.3.3. Limitations and reasons .......................................................................73
CHAPTER 3: MAIN SOLUTIONS TO PROMOTE COMPETITIVENES
FOR NEWLAND INVEST., JSC. .........................................................................79
3.1. Business direction and requirements to promote competitiveness of the
company ...............................................................................................................79
3.1.1. Current situation and requirements to promote competitiveness of the
company .........................................................................................................79
3.1.2. Business operation direction and the guidance to promote
competitiveness of the company .....................................................................82
3.2. Main solutions to promote competitiveness of the Company ..................84
3.2.1. Build the development strategy for Newland Invest., JSC up to 2025 .84
3.2.2. Accelerate the market research activities ............................................85

3.2.3. Promote marketing activities, branding and brand promotion ...........87
3.2.4. Improve the quality of the human resource..........................................88
3.2.5. Raise the material and technical capability .........................................90
3.2.6. Raise the efficiency of capital raising and use .....................................91
CONCLUSION ........................................................................................................94
REFERENCES:.......................................................................................................96
APPENDIX ............................................................................................................100


LIST OF ABBREVIATION
NO.

ABBREVIATION

MEANING

1

BĐS

Bất động sản (Real Estate)

2

CPĐT

Cổ phần đầu tư (Investment Joint Stock)

3

CBCNV

Cán bộ công nhân viên (Staff)

4

NLCT

Năng lực cạnh tranh (Competitive capability)

5

KH

Khách hang (Customers)

6

TP

Thành phố (City)

7

XD

Xây dựng (Construction)

i

INTRODUCTION
1. Urgency of the topic
Since the date of national renewal, under the leadership of the communist
Party with the strong reformation of economic institution, Vietnam has been
integrated with the international economic widely and deeply, raising the position
and the role of Vietnam on international arena. Such result was achieved by the
Party’s policy on the proper concentration on improving business environment and
promote the competitiveness. This was shown through a series of Government
Resolutions issued. With the breakthrough and creative thinking, the Government
has been giving instruction on the proper implementation of the drastic steps in
order to improve the business environment, promote the national competitive
capacity etc.
The real estate market in 2017 was forecasted with more competition compared
to 2015 and 2016. The Victory will be on the side of the projects with outstanding
differences or high quality or rich and experienced owners. In 2017, more projects of
various kinds, segments and locations will be offered on the market. In 2015 and 2016,
in the market, there were many projects developed; therefore, in 2017, the market will
face the risks of saturation. It is essential for the enterprises to save themselves through
the activities of enterprise re-structuring, investment restructuring, stopping, reducing
or expanding the project implementation progress, restructuring the products to be
more suitable to the market demand and purchasing power; promote cooperation and
connection amongst the enterprises; expand trading, merging of the enterprises and
project transferring.
Within the first six months of 2016, the real estate market in Hai Duong
witnessed with fierce competition with the aims to control the market shares.
According to the annual statistics, each year, in Hai Duong market, approximately
800 to 1000 billion dongs are invested in the real estate market. From the beginning
of 2017, the big or small investors all have their own strategies to control the capital
source of the market. Complying to the 2016 statistics, the market shares amongst

the competitors are as follows: Hanoi Nam Cuong Corporation branch in Hai
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Duong 39%, Thanh Dong Real Estate Company 13%, Newland Investment Joint
Stock Company approximately 18%, Hoang Thanh Real Estate Company about
22%, Quang Giap Limited Company around 3% and other small companies. In
2017, it is anticipated with sales launches from the above companies and other new
companies which are accelerating the progress to complete the project procedures in
order to attract investment capital.
Newland Investment Joint Stock Company was established in 2010 with 10
members and the initial charter capital of 6 billion dongs. The company was
officially put into operation in 2011 with the headquarter located in Nguyen Chi
Thanh Street – Hanoi. After 7 years of operation, the company scale was expanded
with 01 branch in Hanoi Duong City, 02 member companies and the human
resource of over 450 people, the charter capital of 258 billion dongs which is
increasing in the upcoming time. The main operation areas are: basic construction,
real estate trading and commerce. Currently, the company is developing and
implementing the construction investment of a series of residential and new urban
areas in Hai Duong City and the company is seeking for the investment
opportunities in new market.
In fact, nowadays, the company is encountering a great number of difficulties
and facing challenges in competition to control the real estate market in Hai Duong.
With the policy of the company leaders which is step by step obtaining the
substantial development for the company in Hai Duong to be the driving power for
the company to promptly implement the investment in Hanoi and other surrounding
provinces. As the person who is in charge of the real estate business in Hai Duong
market, the author always gives the best effort to find the resolution to promote the
competitiveness of the company in the upcoming time. To resolve this issue, it is
necessary to have a special research subject which evaluates in a detailed and

scientific manners from theory to practice so that the best solutions can be achieved
for the enterprise. As a result. I would like to propose the name of the thesis as”
Promoting competitiveness of Newland Investment Joint Stock Company” to be the
Master of Business Administration thesis paper.
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2. Literature review
2.1. International research works
International research works on Competitiveness of a enterprise which the
author have studies are presented in a number of materials as follows:
Michael E. Porter is the author of the work “Competitive advantage which
was translated into Vietnamese and published by the Youth Publisher. In this book,
Porter listed out the value chains, competitive strategies of the firms including low
costs, differentiation, horizontal strategy, diversification and defence strategy.
Particularly. Porter provided deep analysis on the industry structure consisting of
definition of an industry, industry structure and buyers’ demand; industry structure
and demand supply balance, industry segmentation matrix, relationships between
technology and competitive advantage. This is the literature foundation to be
applied to the thesis in analysis of the segmentation analysis, telecommunication
analysis and telecommunication competitiveness.
Michael E. Porter stated in the work named “Competitive Strategy” which
was translated and published by Youth Publisher (2009). In this book, Porter
provided the techniques to analyze the industry and competitors, especially in which
Porter clarify the structural analysis of industries, the elements determining the
competition intension in the industry (customers, substitute products, potential
competitors, supplier and competitors in the industrial), living cycle of a product,
framework for the industry operation forecast. These are the important theories
which will be applied to the thesis to clarify the competitive capacity.
John H. Dunning (1993) in the work “Internationalizing Porter’s diamond”

published in Management International review, special issue, volume 33(2), paper
8-18, expanded Porter’s diamond model in the situation of globalization and
integration of the world economy. Dunning assumed that the old diamond model is
no longer correct in the assessment of competitiveness for a nation/ industry in the
context of international commercial exchange, investment and cooperation. Hence,
Dunning added the element of international investment into the model to evaluate
the elements affecting competitiveness of the nation/ industry.
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While studying the competitive capacity of the enterprise “Theory, analysis
framework and model” of the authors Ambastha and Momaya (2004) provided the
theory on the competitiveness at the enterprise level. The research pointed out that,
the competitiveness of the enterprise is influenced by the elements: (1) resources
(human, structure, culture, technology level and assets of the enterprise; (2)
Processes (strategies, management process, technological process, marketing
process); (3) performance (costs, price, market shares, new product development).
However, the research only stopped at the competitive advantage of the enterprise
in general without distinguishing in terms of scale, geography, and operation fields.
Therefore, there are still a number of limitations to apply the research for the
enterprises of different scales and fields.
Study of Thompson, Strickland & Gamble (2007) proposed the elements
influencing the general competitiveness of an enterprise based on 10 elements
(image/ reputation, technology, distribution network, ability to develop and
renovate the product, production costs, customer services, human resources,
financial situation and promotion level, change management ability). Nevertheless,
this research only identified the elements affecting the competitiveness of the
enterprise and evaluated it with the method of marking to compare the capability
amongst the enterprise without identifying the impact degree of each elements on
the competitiveness and business results of the enterprise.

2.2. Local research works
Regarding the enterprise competitiveness researches, up to now, there have
been a large number of works and articles announced and published. Some
representative works which are directly related to the thesis can be listed as follows:
- Associate Professor. PhD Truong Dinh Chien (2011) in the course book
“Marketing Management”, National Economics University presented a chapter on
competitors and defined the differential competitive advantage when analyzing
competition. This content assisted the author to obtain systematic theoretical basis
when analysing competition comparison with the competitors.
- Pham Thu Huong (2017) in the PhD. thesis on “Competitiveness of the
4


small and medium enterprises researched in the area of Hanoi”, University of
Mining and Geology, identified the elements impacting the competitiveness which
is suitable to the characters of small and medium enterprises of Vietnam as well as
evaluatedthe impact degree of each element on the competitiveness of the small and
medium enterprises.
- Nguyen Thanh Long (2016) in the PhD thesis “Research on elements
affecting the competitiveness of Ben Tre Tourism Enterprise”, Ho Chi Minh
Economics University, systematized theoretical basis on the competitiveness of a
enterprise and several research models on the competitiveness of the enterprise in
tourism industry. The author defined 8 elements affecting the competitiveness of
ben Tre tourism enterprise in relation with the characteristics of socio-economic
conditions and the local natural conditions. The elements includes: (1) Marketing
capability; (2) Brand; (3) Organization and management capability; (4) Social
responsibility; (5) Quality of the products and services; (6) Human resources; (7)
Price competition; (8) Environment condition of the targeted area (policy
mechanism, local people and natural environment).
- Nguyen Duy Hung (2016) in the PhD. thesis on “Enhancing the

competitiveness of the Stock Companies in Vietnam”, National Economics
University, applied the model of internal element assessment by Thompson and
Strickland (2001) to identify the system of 07 internal elements impacting the
competitiveness of the stock companies in Vietnam. These elements consist of
financial potentials; intellectual capital; product quality; technology level; service
quality; brand, reputation and promotion activity; operation network. The thesis
quantified the impact levels of each internal element on the competitiveness of the
stock companies in Vietnam. Based on that, the author provided the equivalent
solution relating to enhancing competitiveness for the stock companies in Vietnam,
especially in the arena of liberalization of the stock market.
- Le Thi Hang (2013) in the Phd Thesis on “Promoting competitiveness in
mobile information service supply of Vietnam telecommunication companies”,
National Economic University, clarified the argument ground on competitiveness in
5


mobile information supply service of an enterprise. Specifically, competitiveness in
mobile information supply service of an enterprise is the possibility of the mobile
information service of such firm to be used largely and promptly on the market
where there are many other enterprises also supply the mobile information service.
The thesis applied the general criteria to evaluate the competitiveness of the
enterprise to identify the criteria to evaluate the competitiveness of the enterprises
in the industry of mobile information supply service, including: service quality;
service charges; services differentiation; service distribution channel system;
commercial information and promotion; brand and service reputation.
- Nguyen Manh Hung (2013) in the PhD. Thesis on “Promoting the
competitiveness of Vietnam telecommunication industry”, National Economics
University. [6], clarified the concept on telecommunication industry. Based on that,
the author specified the contents on competitiveness of telecommunication industry
which has special characters compared to other production industries. The thesis

identified the suitable criteria reflecting competitiveness for telecommunication
industry comprising of: numbers of subscribers, revenues, quality of the service
supplied, performance productivity. Each criteria contains the specific measurement
norm. The author applied the diamond model of M.E. Porter in identifying the
elements affecting the telecommunication industry competitiveness: Structure and
competition in telecommunication industry (numbers of enterprises in the industry,
revenue increasing speed of the telecommunication enterprises, competition
solutions and methods, prices of the services); Telecommunication market demand
(GDP, living standard, expenses on telecommunication industries, infrastructure);
Relevant industries and supporting industries (equipment supply, hardware,
software and digital content supply, input and output equipment supply);
Government (mechanism and policies).
- Bui Duc Tuan (2011) in the PhD thesis on “Promoting the competitiveness
of aquaculture processing industry of Vietnam”, National Economics University.
[6], assessed the barrier elements influencing the enhancing the competitive
advantage of the aquaculture processing industry in Vietnam nowadays, besides the
6


certain competitive advantages to other countries in the world such as natural
advantage, domestic demand, domestic competitive environment, etc. The research
demonstrated that the current results of the industry are mainly achieved on the
foundation of exploitation and taking advantages of the natural advantages (favours
of natural resources, labour advantages); however, the industry has not yet been
placed on the firm foundation of other national advantages (domestic demand,
domestic competitive environment and other supporting industry).
- Nguyen Dinh Tho & Nguyen Mai Trang (2009) performed the
measurement of several elements forming the dynamic capability of the enterprises
in the area of Ho Chi Minh City by quantity method. The authors studied four
elements forming the dynamic capability of the enterprises including business

orientation, study orientation, marketing and creative ability and the influential
degree of such elements on the business results of the enterprises. [15]/ The limits
of this study is that the results were only tested on the enterprises in the area of Ho
Chi Minh City. Moreover, the research only examine generally without detailed
analysis of each business industries including products, services, high technology,
industry, labour deepening etc. As a result, the research could not identify the
certain differences of the dynamic capability on the business advantages and
business results. Finally, result only considered several main dynamic capability
whilst there are a great number of enterprise elements which can be the dynamic
capability elements to be considered to create the general model on dynamic
capability to form the competitive advantage and business results of the enterprises.
These elements can be the production ability, R&D, market orientation, intellectual
localization etc.
3. Research purposes
- Proposing the solutions to promote the competitiveness of Newland
Investment Joint Stock Company.
- Research obligations:
+ Systematize the general theory on the competitiveness of the enterprise.
+ Study several international experience and other experience from economic
7


corporations of Vietnam, and withdraw the lessons on competitiveness.
+ Clarify the competitiveness of Newland Investment Joint Stock Company,
assess the success, limitation and reasons for those situation.
+ Provide the direction, search for and propose the efficient solutions to
promote the competitiveness of Newland Company in the upcoming time.
4. Research subject
The research focuses on studying the competitiveness of Newland
Investment Joint Stock Company.

5. Research scope
The main fields of the Newland company are basic construction; property
trading. Due to the limitation of time; as a result, within the study scope of this
research, the thesis will deeply study the competitiveness of the company in the
field of property trading with the focus on Hai Duong province where the company
is implementing the investment of series of real estate projects.
The evaluation of the competitiveness of the enterprises is very broad and it
requires plenty of different evaluation indices. Therefore, due to the limitation of
research time, and the resources to perform the research, the author focuses only on
two basic criteria groups to assess the competitiveness of Newland Invest., JSC.: the
group of criteria reflecting business results and efficiency such as revenue market
shares and growth speed; Group of criteria reflecting strengths and business
advantage of the Company on: Products, brand, human resource, Company’s
adaptability and renewal, service organization ability, the enterprise’s associatiion
and cooperation ability.
This research uses the concentrated data from 2012 up to now; based on such
information, analyze the current situation and provide the solution to promote
competitive advantages from the present to 2025.
6. Research methodology
6.1. Secondary data
The internal data supply sources are the Financial and Accounting Division,
Business Department, Site Clearance Department, etc. of Newland Investment Joint
8


Stock Company as well as the internal information and the analysis report of the
company. These secondary data sources are mainly used to analyze the
competitiveness at the corporation.
The external data resources comprises of books and international materials
on competition, specialized journals and science conference summary records, etc.,

the theories on competition in enterprises; data on the current situation as well as
the real estate development orientation in Vietnam.
6.2. Primary data
The primary data were collected through the interview methods with the
interviewees are described as follows:
- At the company, they are the 04 managers who are directly in charge of
different sections, 10 employees in the company. The purpose of the interviewing
the managers and employees is to exploring issues involving with the operation of
the company, especially obtaining assessment on the company, clients and
competitors.
- The author implemented the survey to collect the Company clients’
opinions on the competitiveness by using the questionnaires. Specifically:
+ Distributed sheets: 50 sheets.
+ Qualified sheets: 48 sheets.
+ Survey period: October 2017.
+ The Survey questionnaire is presented in details in Appendix 01.
+ The purposes of the interviews with the clients of the company is to study
the issues relating to the operation of the company which the secondary data could
not totally reflect and to collect valuable information which can demonstrate the
current situation of the competitiveness of the company through the clients’
judgment.
7. Thesis structure
Besides the introduction, conclusion, lists of tables, diagrams, and reference,
the thesis is divided into three chapters:
Chapter 1: Basic issues on competitiveness and experience to enhance the
9


competitive advantages of the enterprises.
Chapter 2: Current situation of the competitiveness of Newland Investment

Joint Stock Company.
Chapter 3: Main solutions to promote the competitiveness for Newland
Investment Joint Stock Company.

10


CHAPTER 1: BASIC ISSUES ON COMPETITIVENESS AND EXPERIENCE
TO ENHANCE COMPETITIVENESS OF THE ENTERPRISE

1.1. Competition and roles of competition in a enterprise
1.1.1. Concept and classification of competition
1.1.1.1. Competition concept
Competition is the element which appeared a long time ago and has always
been attached with the establishment and development each enterprise. However,
what competition is up to now there have been a great number of inconsistent
definitions in Vietnam as well as all over the world.
According to Karl Marx (1978):” Competition is the intense battle and fight
amongst the capitalists to scramble for favourable conditions in goods productions
and consumption to gain the excess profits”. Karl Marx discovered that the basic
law of capitalism competition is the law on the adjustment of average profit rate,
through that, forming the market price system. This law based on the differences
between the prices of production costs and the ability to sell the products at the
prices below its value but still gaining profits.
In compliance with Vietnamese dictionary (2002):” Competition can be
construed as using endeavours to gain the better and winning to their side amongst
the operating individuals and organization towards the same benefits”.
Complying with Nguyen Huu Huyen (2003):” Competition is the behaviour
of the separate enterprises and the competitors of each other in product and service
supply in order to satisfy the similar needs with the similar lucks of each sides,

which is presented through attracting or losing a number of regular customers”.
Based on the concepts as above, competition can be generalized as” the
intense battle amongst the subjects operating together in the market, with the same
or similar substitute products in order to control the market shares, raise the sales
and revenue.”
In summary, through the definitions, competition can be considered in terms
of the following viewpoints:
11


First, mentioning competition is mentioning the battle to gain the victory of
many participating subjects.
Second, the direct purpose of competition is a specific subject which all sides
wish to compete for (an opportunity, a product or a project, etc.); a favourable
condition series: market, customers etc. with the final purpose of earning high
profit.
Third, competition happens in a specific environment, with common
bindings that the participating parties must follows including: product characters,
market, legal conditions and business practice, etc.
Forth, during the competition process, the subjects participating can use
different tools: competition by the product characteristics and quality, competition
by the art of consumption, sales services and payment etc.
It is necessary for the firms to obtain proper acknowledgement of
competition in order to accept competition in a positive aspect; based on that to
promote the internal elements to raise the customer serving quality. On the other
hand, the firms should try to avoid the insensible competition which can harm the
community benefits as well as weaken themselves.
1.1.1.2. Competition classification
In accordance with Hoang Trung (2015a), based on the different concepts
and roles of competition, competition can be classified into various form:

a) Based on the subjects participating competition
- Competition between the buyer and the seller is the competition happens
according to the law of cheap purchase and expensive sales, both sides wish to
optimize their benefits. The sellers wish to sell at the highest price to optimize profit
whilst the buyers wish to buy at the lowest price with ensured quality and the final
price level is the price agreed between two sides.
- Competition between buyer and buyer is the completion in the basis of law
og supply and demand when on the market, the supply is less than the demand. At
this time, there will be shortages. The buyers in order to satisfy their wishes, are
willing to buy at higher price; therefore, the competition level will be more intense
12


amongst the buyers. This leads to the increase in the prices of goods.
- Competition amongst the sellers: This is the most intense and fierce
competition when in the market economy, the supply is much larger than demand,
customers are considered to be the gods of the sellers and the crucial element of the
existence and development of an enterprise.
b) Based on the economic scope:
-Competition within an industry: Is the competition amongst enterprises in
the same industry which produce and consume the same types of products. In this
competition, there are acquisitions. Enterprise have to apply all the methods to earn
profits including improving the techniques, raising the labour productivity, reduce
the particular expenses of the goods in order to earn excess profits.
- Competitions amongst different industries: is the competitions amongst
different economic industries to gain the highest profits. It can be the competition
amongst the enterprises or allies of the enterprises in a industry with the other ones.
- Competitions amongst countries is the battle amongst the countries to
promote strengths of the countries to create the competitive advantages to control
the global market.

c) Based on the characters and degrees of competition
Based on this criterion, competition can be classified into two types:
- Perfect competition is solely the competition which is a simple form of the
market in which the buyer and the seller are not big enough to affect the market
price. The group of buyers participating in this market can only adjust to the offered
price level because the demand on the market is free to form, the price is set by the
market.
- Imperfect competition: This is the common competition in the market in
which the enterprise with sufficient strength can control the prices and types of
products. Imperfect competition is the competition in which majority of the projects
are inconsistent, each product has different labels and characters. With
consideration of the quality, there is not much difference but the default price level
is much higher. Imperfect competition has two types:
13


+ Monopoly competition which is the competition in which one or a few
subjects with big influence can force their partners to sell or purchase their products
at high prices and may change the market price.
+ Monopoly corporation: This competition exists in a several production
industries in which there are few producers. At this time, competition will happen
amongst a small number of enterprises.
1.1.2. Roles of competition
1.1.2.1. Roles on national economy
Competition is the environment and the driving force to accelerate the
development of every economic components in the market economy, contributing to the
elimination of monopoly, irrationality and inequality in business. Competition ensures
the acceleration of the development of science and technology and the labour allocation
will deeper. Competition promotes the diversification of products in order to meets the
higher requirements of society, exciting the development demand, creating new

demands, contributing to raising the social life quality and develop the economy.
Besides the positive impacts, competition also creates negative issues
including fake goods, trafficking and tax evasion etc. leading to the instability of the
market, lost to the state and consumers.
1.1.2.2. Roles on the enterprises.
Competition is regarded as “a colander” to select and eliminate the
enterprises. Consequently, it can promote the competitiveness of the enterprise. As
a result, it plays an significant role. Competition determines the existence and
development of an enterprise. Competition creates the driving force for the
development of the enterprise, accelerates the enterprise to find the solutions to
raise the production and business efficiency. Competition requires the enterprise to
develop marketing from the initial market research in order to define the demand of
such market so that the enterprise can make the decisions on production and
business to meet such demands. Besides, enterprises must improve the service
activities as well as promote the advertisement, promotion and guarantee of
activities etc.
14


Competition forces enterprises to launch the products with higher quality to
satisfy the frequently changed demands of the consumers. In order to do so,
enterprises should apply new scientific and technological achievements into
production and business process, improve the management activities, and improve
the levels and the skills of the workers etc. From that, make the enterprise more
developed.
1.1.2.3. Roles on the real estate investment and trading industry
The real estate investment and trading industry of Vietnam has just been
formed and developed since the time the Law on land 2993 took effects. During the
period of newly formation, due to the incomplete legal system, overheating
development speed as the demand of property is great while the supply is limited,

the property prices shot up continuously, the business of property investment and
trading had earned profit for a long period, all projects gained profits. The
secondary investors still gained profits from their purchase. Products launched to
the market were immediately purchased. This reality caused the real estate
industries only performed project lobby and ask for project permissions without any
consideration on the competition and promotion of the competitiveness of their
enterprises.
After a long period of overheating development, currently, when the supply
exceed far more than the demand, a large number of property business enterprises
encounter the lost in business activities or do not perform the business at the top
gear, their products could not be sold leading to the risk of bankrupt. Market law
demand the enterprise to improve, renovate and enhance their competitiveness to
achieve victory in competition so that they can survive and development. Thus,
competition has become an significant element determining the success or failure of
each enterprise in particular and determine the development or elimination of the
whole real estate industry in general. Competition in real estate investment and
trading is also the foundation for the State authorities to complete the legal system,
step by step to make the market sound, create equal competitive environment for all
enterprises. Based on that, real estate business in Vietnam may have the opportunity
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to development substantially and stably.
1.1.2.4. Roles on products
Competition creates driving force for the enterprises to cut down the
expenses in order to reduce the product prices, to actively apply science and
technological advances to raise the labour productivity, perform research pro
manufacture the products that can meets the requirements of the consumers.
Thanks to competition, production quality is becoming better and better,
product types and models are various, results in more and more profits to both

consumers and enterprises. Because of the motivation in competition, enterprises
will be active in researching and developing new products including the new
segments such as villas, garden houses, detached houses, resorts, first class or midrange apartments, low price commercial apartments with small area etc. to meet the
higher and higher demands of the consumers.
1.1.2.5. Roles on the consumers
Vietnam is currently one of the countries with slow developing economics.
The annual average incomes per capita are approximately 1,500 USD/ year.
Property is a big asset and the chance to possess a property is becoming a difficulty
for majority of household in Vietnam, especially when the market is overheating,
real estate prices climbed. When competition is the motivation for the enterprises to
find all the solution to diversify the products, reduce costs, lower the prices,
providing consumers with the opportunity to select and own their property with
reasonable prices, best quality and better services.
1.2. Competitiveness and the necessity to promote the competitiveness of the
enterprise
1.2.1. Concept of competitiveness of the enterprise
The concept of competitiveness was first introduced in the USA in the early
1980s. According to Aldington Report (1985):”The enterprise with competitiveness
is the enterprise which can produce the products and services of outstanding quality
and lower price than the local and international competitors. Competitiveness also
means the achievement of long term benefit of the enterprise and the ability to
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ensure the incomes of the employees and the owners”. This definition was
mentioned again in the White book on the Competitiveness of England (1994). In
1998, Ministry of Commerce and Industry (England) provided the definition: “ For
the enterprise, competitiveness is

the ability to produce the right products,

determine right the price at the right moment. This means that satisfying the
customers’ demands with greater output and effect than other enterprises”.
In accordance with the dictionary of economics terms:” Competitiveness is
construed as the ability to achieve large market shares before the competitor in the
market as well as the ability to re-gain partially or wholly the market shares of the
competitors”.
- The Organization for Economics Cooperation and Development (OECD)
defined competitiveness as “The ability of companies, industries, regions, countries
or supernational regions in creating higher employment and incomes in the
condition of international competition on the basis of sustainability”.
- On the general view point with human as the centre, the concept of
competitiveness was defined by World Economics Forum as follows: ”Regarding
the enterprises, competitiveness means creating new growth, bringing the values for
shareholders. Regarding the society, raising competitiveness means creating new
employments and better living conditions”.
Michael Porter (2009b) assumed that it is difficult to provide an absolute
concept or definition on competitiveness. According to him, “To achieve successful
competition, enterprises should have competitive advantage in the form of or have
the lower production costs or have the ability to differentiate products to gain the
price higher than the average level. To maintain competitiveness, enterprises should
achieve more refined competitiveness so that they can supply the products or
services with higher quality or produce at higher efficiency”.
Several local authors, based on Porter’s point of view, provided their
definitions of competitiveness including Nguyen Minh Tuan (2010) stated that,
enterprise’s competitiveness is the ability to maintain and promote competitive
advantage in product consumption, network consumption expansion and efficient
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use of the production elements with the aim of high economic benefits and
ensurance of substantial economic development. Vu Trong Lam (2006) said that,
enterprise’ competitiveness is the ability to build, maintain, use and create new
competitive advantage of the enterprise. Le Cong Hoa & Le Chi Cong (2006)
assumed that competitiveness of the enterprise is the demonstration of enterprise’s
strengths and advantages in comparison with the competitors in meeting the best
requirements of the customers to earn higher and higher profits.
Therefore, there have been different view points on competitiveness. Within
the scope of this thesis, the author uses the opinion that” enterprise’ competitiveness
is the ability to build, maintain, use and create the enterprise’s competitive
advantages to meet the best requirements of the customers (in comparison with the
competitors) and achieve the goals of the enterprises”.
Enterprise’s competiveness is created firstly from the enterprise’s resources.
These are the internal elements of the enterprises which should not be measured by
the criteria of technology, finance, human resource, enterprise management
organization etc. separately. On the other hands, they should be evaluated and
compared with the competitors operating in the same field and in the same market.
There are many enterprises participating in Vietnam real estate market, which
creates the opportunity for the market to development; at the same time, it will also
be a great challenge as the specialization level of the enterprises are still low,
competitiveness of the enterprises are limited. Generally, this leads to great inertia
for the whole market.
1.2.2. Characters of enterprise’s competitiveness
According to Nguyen Viet Lam (2014), enterprise’s competitiveness consists
of several basic characters as follows:
First, enterprise’s competitiveness depends on the internal elements
(strengths and advantages) and external elements (business environment).
Second, competitiveness of each enterprise is not identified separately and
individually; however, it is identified in the evaluation and comparison with the
competitors operating in the same field and the similar market.

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