Tài liệu E commerce logistics in vietnam the reality and solutions

ĐẠI HỌC QUỐC GIA HÀ NỘI KHOA QUẢN TRỊ VÀ KINH DOANH --------------------- NGUYỄN VĂN THỊNH E-COMMERCE LOGISTICS IN VIETNAM THE REALITY AND SOLUTIONS LOGISTIC TRONG THƯƠNG MẠI ĐIỆN TỬ Ở VIỆT NAM: THỰC TRẠNG VÀ GIẢI PHÁP LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH HÀ NỘI - 2018 ĐẠI HỌC QUỐC GIA HÀ NỘI KHOA QUẢN TRỊ VÀ KINH DOANH --------------------- NGUYỄN VĂN THỊNH E-COMMERCE LOGISTICS IN VIETNAM THE REALITY AND SOLUTIONS LOGISTIC TRONG THƯƠNG MẠI ĐIỆN TỬ Ở VIỆT NAM: THỰC TRẠNG VÀ GIẢI PHÁP 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. BÙI QUANG HƯNG Hà Nội - 2018 DECLARATION The author confirms that the research outcome in of this thesis is the result of author‟s independent work during study and research period, and it is not yet published in other‟s research and article. The other‟s research results and documentation (such as extractions, tables, figures, formulas and other document) used in the thesis are cited properly, and the permission (if required) is given. Plagiarism in this Thesis will not be tolerated by The author is responsible in front of theLaws and Thesis Assessment Committee, Hanoi School of Business and Management, and the laws for above-mentioned declaration. Date: December 11, 2017 ACKNOWLEDGEMENT I have gained huge knowledge, skills and insights from my MBA course. The course raises my capacity of administration and management up to the next level. I am now very confident in my position of management. I would like to extend my sincerest thanks and appreciation to all those who have helped me makde this Thesis to be possible. First of all, I would like to express my deepest and sincerest gratitude to my supervisor, Dr. Bui Quang Hung for his useful comments, remarks and engagement during my process of doing this master Master Tthesis. I would like to give my sincere thanks tocustomers who have purchased and used the services of logistics businesses, in my survey, who have willingly spent their precious time joining the interviews. Sincere thanks are extended to the Hanoi School of Business and Management (HSB) - Vietnam National University for equipping me with huge knowledge and skills through various interesting and practical subjects. I also would like to thanks my classmates for their friendship and reciprocal encouragement to make our class time to become unforgettable time. Lastly, I would like to give my great thanks to my family who have been always standingby me during for the past two years, and encourages encouraging me to keep moving from the beginning of my study. Formatted: Space After: 0 pt This page is intendedly left plank E-COMMERCE LOGISTICS IN VIETNAM THE REALITY AND SOLUTIONS E-Commerce logistics in Vietnam The reality and solutions 1. Summary of the results The result of the thesis is to provide the solutions of logistics for e-commerce in Vietnam. Study on the general situation of logistics and logistics in e-commerce in Vietnam. Propose Proposing solutions (infrastructure of transport, technology and policies) related to logistics is to support E-commerce development. 2. Applicability in practice E-commerce is a growing field in the world, as the trend is irreversible. However, in Vietnam there are many obstacles to the development of e-commerce and the biggest barrier now is the logistics (logistics for e-commerce). The thesis studiesy on the ongoing issues at the big e-commerce companies in Vietnam and around the world, opportunities and challenges in the coming time to provide practical solutions to overcome these exist to be able to support Vietnam ecommerce development. Comment [THP1]: Không có vị ngữ. (nghiên cứu các tình tình trạng chung của Logistics và Ecommerce Logistics...để làm gì? TABLE OF CONTENTS LIST OF TABLES .............................................................................................................. i LIST OF FIGURE ............................................................................................................. ii FOREWORD ...................................................................................................................... 1 1. Problem of statement .......................................................................................... 1 2. Literature review ................................................................................................. 2 3. Research objectives............................................................................................. 4 3.1 General objective ....................................................................................... 4 3.2 Detail objectives ..................................................................................... 4 4. Research subjects ................................................................................................ 5 5. Research scope .................................................................................................... 5 6. Research methodology........................................................................................ 5 6.1 Data collection methods ................................................................................... 5 6.2 Data processing methods .................................................................................. 6 7. Research structure ............................................................................................... 6 CHAPTER 1: THEORETICAL FRAMEWORK ON E-COMMERCE AND LOGISTICS IN E-COMMERCE ................................................................................... 7 1.1 E-commerce ...................................................................................................... 7 1.1.1 Concept.................................................................................................... 7 1.1.2 Components of e-Commerce ................................................................... 8 1.1.3 Ecommerce models ................................................................................ 11 1.1.4. The role and benefits of e-Commerce .................................................. 12 1.2 Logistics in e-commerce ................................................................................. 16 1.2.1 General concept .................................................................................... 16 1.2.2 Components of Logistics in e-commerce............................................... 16 1.3 Factors influencing logistics in e-commerce .................................................. 19 1.3.1 Macro Factor ........................................................................................ 19 1.3.2 Subjective factors .................................................................................. 20 CHAPTER 2: LOGISTICS STATUS IN E-COMMERCE OF THE WORLD AND VIETNAM ............................................................................................................... 23 2.1 Logistics Status in E-Commerce of the World ............................................... 23 2.1.1 Research at Amazon. ............................................................................. 23 2.1.2 Research in Wal-Mart ........................................................................... 29 2.1.3 Overall evaluation of logistics solutions in e-commerce in the world .. 34 2.2 The status of logistic in Viet Nam .................................................................. 35 2.2.1 Research at Sendo.vn ............................................................................ 35 2.2.2 Research at Tiki.vn ................................................................................ 43 2.2.3 Analyzing the influence of factors on logistic behavior in e-commerce49 2.2.4 Customer survey .................................................................................... 55 2.2.5 Summary of SWOT Matrix .................................................................... 61 CHAPTER 3: SOLUTIONS TO COMPLETE LOGISTICS IN E-COMMERCE IN VIETNAM ................................................................................................................... 64 3.1 Logistics operations development direction in Vietnam e-commerce sector . 64 3.2 The proposed solutions for Logistics activities in the EC in Vietnam ........... 65 3.2.1 proposed solutions to business .............................................................. 66 3.2.2 Recommendations to the State .............................................................. 69 REFERENCES ................................................................................................................. 72 APPENDIX........................................................................................................................ 74 Survey Questions .................................................................................................. 74 LIST OF ACRONYMS 1 APEC Asia-Pacific Economic Cooperation 2 B2B Business-to-business 3 B2C Business-to-consumer 4 B2G Business-to-Government 5 C2C Consumer-to-consumer 6 C2G Customer to Government 7 CPFR Collaborative Planning, Forecasting and Replenishment 8 EDI Electronic data interchange 9 POS Point of Sale 10 SMS Short Message Services 11 VND Viet Nam Dong LIST OF TABLES Table 1.1: E-commerce models ........................................................................................... 11 Table 2.1: Amazon's refund policy ...................................................................................... 29 Table 2.2: Service prices in the city on Shipchung.vn ......................................................... 38 Table 2.3: Prices in interprovincial ...................................................................................... 40 Table 2.4: Return Policy of Sendo.vn .................................................................................. 41 Table 2.5: Refund processing at Sendo.vn........................................................................... 42 Table 2.6: Order processing capacity................................................................................... 45 Table 2.7: Delivery fee and order processing at Tiki.vn...................................................... 46 Table 2.8: Return goods policies of Tiki.vn ........................................................................ 47 Table 2.9 : Customer survey results ..................................................................................... 55 Table 2.10: Customer survey results .................................................................................... 57 Table 2.11: Customer survey results on transportation activities ........................................ 59 Table 2.12 : Customer survey results on Return shipping ................................................... 60 i LIST OF FIGURE Figure 1.1: Components of e-Commerce ....................................................................................9 Figure 2.1: Process Order at Amazon .......................................................................................23 Figure 2.2: The application process at Amazon........................................................................ 25 Figure 2.3: Amazon Warehouse ...............................................................................................26 Figure 2.4: Amazon's warehouse system .................................................................................. 27 Figure 2.5: Amazon's shipping process ....................................................................................28 Figure 2.6: Process Order at Wal-Mart .....................................................................................30 Figure 2.7: Walmart's warehouse systems ................................................................................ 31 Figure 2.8: the inventory management process at Wal-Mart ....................................................31 Figure 2.9: Cross-docking technology process at Wal-Mart ....................................................33 Figure 2.10: Processing online at Sendo.vn .............................................................................. 36 Figure 2.11: The number of orders per day on sendo.vn ..........................................................37 Figure 2.12: Processing online at Sendo.vn .............................................................................. 43 Figure 2.13: Number of orders.................................................................................................. 44 Figure 2.14: Infrastructure information technology.................................................................. 51 Figure 2.15: the level of use of electronic equipment in enterprises in our country .........................52 Figure 2.16: About using email by enterprise size..................................................................... 53 Figure 2.17: Charted the cost of procurement and application of information technology in ecommerce .................................................................................................................................. 54 ii FOREWORD 1. Problem of statement Globalization and international integration brings tremendous opportunity opportunities for enterprises after Vietnam joins series of international trade organizations (WTO-2007, TTP 2015, EVFTA-2015, ASEAN-AEC...). However, most business executives and enterprises managers spend a lot of time for finding solutions to overcome challenges and competitive pressures than expected business opportunities that these agreements bringing out. The solutions are often mentioned in economic research and business strategy building such as: enhancing product quality, reduce product costs, building and brand management, innovation-creative, enhance qualifications, modernizing equipment and technology, increasinge investment and international cooperation ... These solutions are absolutely correct in terms of business strategy. However, to help make these strategies are effective as expected, the internal problems of the business needs to be a basically rebuilding, which , logistics is one of the aspects that businesses in Vietnam have not yet widely appreciated. This is an activity that appeared in the entire process of production and business of enterprises. Logistics take an important role in the planning and using of materials in production, transferring of goods to consumers, and even in the management process of funds and human resources. This activity contributes to lowering the cost of production and business, shortening the time for circulation of goods, capital optimization, ensure deadline and progress of business contracts and partly enhance reputation and corporate brand. In electronic commerce (E-commerce), logistics plays an active role in the Back-End1 activities of E-commerce enterprise with the basic objective is the delivery time, a sufficient number quantity, right place, right customers ... enhances competitive advantage for businesses. Although since 2011 to date, the logistics service in Vietnam has been developinged rapidly, it has not yet to meet the needs of e-commerce. Also, many e-commerce businesses (considered as the big enterprises in the field of e-commerce) must be close downd last year as: Beyeu.vn, Deca.vn, Fab.vn, and Lingo, recently. 1 In the field of e-commercial, we use the term of "Back-end" to talk about the process since online customer accept buying to the time of goods, products be delivered to customer. 1 Comment [THP2]: Không hiểu ý câu này là gì nên không chỉnh được ngữ pháp. Hiện ngữ pháp và cách dùng từ đang bị sai. Vietnam E-commerce and Information technology Agency (VECITA) reported that, the interests of online consumers in Vietnam have not been adequately protected. While 40% of online customers think that the price of online shopping is not cheaper than tradition, 38% are worriedy (and complain) about the time of delivery (sometime missing or lost). In addition, as the report of VECITA, Vietnam E-commerce is not as developed as its potential2. This is the biggest barrier to e-commerce businesses in Vietnam, and this is one of the top priorities that businesses in the field of e-commerce in Vietnam have to solve remove/ take off in the near future. With these above briefly outlined of limitations, the author selected the topic "E-Commerce logistics in Vietnam: The reality and solutions" to complete the Mmaster Tthesis. 2. Literature review Logistics in business is not a fledgling area of research in the world (as in Vietnam). The first study in this area was formed in the lately 60s of the last century by E.W. Smykay, Donald J. Bowersox, Frank H. MossmanEW Smykay, Donald J. Formatted: Font: 13 pt, Italic Bowersox and Frank H. Mossman3 with a book about "Physical distribution development, current status, and potential"”. In this study, the authors acknowledged the formation of a new business field called Logistics (associated with company of Malcolm P. McLean - the father of the oversea shipping industry - the beginning of the global logistics sector). The authors noted that this is a totally different activity is way more different thanfrom the stages and processes of distributation in marketing and purchase management in production. Shortly after this publication was published in 1969, the researchers and the business world were quick to learn the terminology of this logistics, contributing to the rapid development of a new study field in business. Research by Heskett, J.L., Glaskowsky, N.A. and Ivie Jr4 titled "Business Logistics", was published in 1973. In this period, the study of logistics issues to focused on distribution operations to reduce business costs. Research has proven Logistics accounts a large amount of resources and the cost of production and business 2 3 With more than 90 million of population, 44%-48% population use internet, just 2.6 million online customers. Bowersox, D. J. (1969). Physical distribution development, current status, and potential. The Journal of Marketing, 63-70. 4 Heskett, J. L., Glaskowsky, N. A., & Ivie, R. M. (1973). Business logistics; physical distribution and materials management (Vol. 1). Ronald Press Co.. 2 Formatted: Font: 13 pt, Bold, Italic operations, and at that period, problem of optimization of logistics is being left (it did not take much care of enterprise at that time). Therefore, solving the problems of logistics can provide huge competitive advantage for businesses. The findings resonated large and manufacturing enterprises soon gathered optimum distribution process, transport…that opening the period of distribution of matter in the Logistics. However, electronic trading was underdeveloped, so this study purely confined Logistics within the visible material. In 1985, Jack W.Farrell made a research breakthrough in the field of logistics. Farrell‟s study titled of "New Clout for logistics". ”. This study demonstrated the Formatted: Font: 13 pt, Bold, Italic effectiveness of logistics wouldill increase when we consider Logistics on the integration view. At the same time, the study also confirmed integrated Logistics will would bring more profit and competitive advantage for enterprises, improving the image and relationship with customers. However, despite the views of FARELL is correct, this study has not implemented quantitative benefits that the authors stated. On the e-commerce field, the concept of logistics was originally considered as the traditional view (transport, cargo transfer ...). However, theseis views were quickly rejected and backward with the rapid changes of e-commerce. However, until now, research on the logistics of e-commerce is still a new array of topics in the world. In 2000, Deborah L.B5 made a first study on the logistics of e-commerce, called "“E-Commerce Logistics & Fulfillment: Delivering the Goods".”. This work is fundamental reference for many next-after researches on theoretical perspectives and model. However, the major limitation of this study is that the scope of study conducted in the UK, where e-commerce is not large enough (in the world) to widely applied. Recently, in 2013, Zhang Jin Shan conducted research "“Logistics and e- Formatted: Indent: First line: 1.27 cm, Space After: 0 pt commerce logistics management". ”. This is an in-depth study on logistics in Ecommerce. Beside the comprehensive overview of E-commerce logistics, this study has performed a quantitative analysis of E-commerce cooperation in China - the largest online market of the world. However, the author is not proposingdid not propose radical solutions to support the growth of Ecommerce in China Logistics Formatted: Font: 9 pt, French (Canada) 5 Bayles, D. L., & Bhatia, H. (2000). E-commerce logistics & fulfillment: delivering the goods. Prentice Hall PTRPrentice Hall PTR. 3 Formatted: Font: 9 pt, Italic, French (Canada) Formatted: Font: 9 pt, French (Canada) In Vietnam, the researches on this field were most deployed on the base of traditional view of logistics. On the aspect of the international experiences, study made by the Ministry of Trade of Vietnam (2006) (ministerial-level) with the title of “International experiences in Logistics and lessons for Vietnam"is was a good reference. In this study, the authors assessed the impact of logistics to business and business results of enterprises in Vietnam, in general. The success of this study on the lessons of international experience that is was very useful for Vietnam. However, the authors have did not mentioned field of E-commerce logistics. Another theoretical study is the lecture book of Van, Doan Thi Hong. This is a pretty comprehensive product. This book contents 11 chapters all about the Logistics activities that includes: overview of the logistics, the logistics services sector, Logistics solution, Logistics Administrator, Customer service, Information systems, Reserves, Managing supplies, determine the need of supplies and materials demand forecast, transportation, warehouses. However, as the same with the study of Ministry of Trade of Vietnam (2006), this study does not include reference to the category of ecommerce logistics. Thus, after the process of the review study, the authors recognize the “research gaps” in Vietnam is the logistics of e-commerce. Most references in this field in Vietnam just VECITA annual reports (or some statement is not scientific research). Therefore, the gap is defined here as e-commerce logistics in Vietnam. The author hopes that, if the research objectives are solved in this study, this study results will contribute to fill the research gap as mentioned above. 3. Research objectives 3.1 General objective This research overall is of an aim of assessing the situation in the electronic commerce logistics of Vietnam in order to propose solutions that support the development of electronic commerce, in general, and e-commerce logistics in Vietnam, in particular. 3.2 Detail objectives - Clarify Theoretical Framework On E-Commerce And Logistics In E-Commerce 4 Formatted: Indent: First line: 1.27 cm, Space After: 0 pt - Study the actual experiences in E-commercial Logistics in the world and lessons for Vietnam - Assessment the actual status of E-commerce and E-commercial Logistics in Vietnam, identify the achievements and limitations in this field of Vietnam. - Suggest some solutions to support for the development of Vietnam Ecommercial Logistics 4. Research subjects This research focuses on actual status in Viet Nam E-commerce and Ecommercial Logistics Formatted: Font: 13 pt, English (United States) Formatted: Indent: First line: 1.27 cm, Space After: 0 pt 5. Research scope Research at e-commerce sites of the world and Vietnam: + Some e-commerce businesses in the world: Walmart.com and Amazon.com + Some e-commerce businesses in Vietnam: Sendo.vn and Tiki.vn Formatted: Indent: First line: 1.27 cm, Space After: 0 pt 6. Research methodology + Expert method: This method is used in determining the significance of the Formatted: Heading 2 factors affecting the Logistics for e-commerce businesses in Vietnam. Experts include: intensive teachers in ecommerce, managers and founders of e-commerce Formatted: Font: Not Bold, English (United States) businesses, the administrators of Sendo.vn, Tiki.vn, Cucre.vn ... + Customer survey method: Measure customer satisfaction on Logistics in e- Formatted: English (United States) commerce 6.1 Data collection methods To achieve the objective of the study authors collected primary data and secondary data: + To collect secondary data on the logistic activity of e-commerce businesses around the world, the author use two large-scale e-commerce businesses, Walmart and Amazon, as the representatives. The author collects data at the websites of these two enterprises on each logistic activity in e-commerce: Order processing, Inventory management, Transportation, Order refund; thereby drawing lessons on logistic for ecommerce businesses in Vietnam + To collect secondary data from e-commerce businesses in Vietnam, the author chose two representatives at e-commerce businesses: Sendo.vn and Tiki.vn. 5 Formatted: Normal, Indent: Left: 0.75 cm, First line: 0.55 cm From their data, the author found out the strengths and weaknesses in logistic activities of e-commerce businesses in Vietnam. + The author use data from the Vietnam E-commerce Association in 2016 to analyze the current status of environmental factors: Impact of external environmental factors (Legal Frameworks, Infrastructure information technology and Subjective factors of human resources in the enterprise) to clarify the factors affecting logistic in e-commerce of Vietnamese enterprises. + Primary data was collected by interviewing customers who have purchased goods via e-commerce channels of enterprises in Vietnam. The purpose is to assess the level of satisfaction of customers about logistic policies in e-commerce of Vietnamese enterprises. The author designs the questionnaire and asks the businesses to post it on their website to collect the customers' opinion. The number of votes received by the author was 203 votes. Therefore, the author conducted the study with 203 questionnaires. 6.2 Data processing methods Data will be collected after processing by software Excel and Word software, in Formatted: Normal the form of graphs and tables 7. Research structure Thesis is structured in accordance with the following content: Formatted: Space After: 0 pt FOREWORD Chapter 1: Theoretical Framework On E-Commerce And Logistics In ECommerce Chapter 2: Logistics Status In E-Commerce Of The World And Vietnam Chapter 3: Solutions To Complete Logistics In E-Commerce In Vietnam 6 Formatted: Indent: First line: 1.27 cm, Space After: 0 pt CHAPTER 1: THEORETICAL FRAMEWORK ON E-COMMERCE AND LOGISTICS IN E-COMMERCE 1.1E-commerce 1.1.1 Concept E-Commerce is defined by many international organizations, but there is no uniform definition of e-commerce. In general, definitions of e-commerce are divided into two groups depending on the point of view (Pu Xiao, Jin Si Shi Gang, Deng Bian Zhu, 1991). In a narrow meaning In the narrow meaning, e-commerce is known limitedly to be the purchase and sale of goods and services through electronic means, especially via the Internet and other interconnected networks (Kearney, 2015). According to the World Trade Organization (2010): "E-commerce consists of the production, advertising, sales and distribution of products which are purchased and paid on the Internet, but are the tangible products, including delivery products as well as digital information via the Internet.” According to the Asia-Pacific Economic Cooperation (APEC) Electronic Commerce Committee (2012): "E-commerce is a business that is conducted through data communication and digital information” According to Economic Informatics Department of National Economics University: "E-commerce is the exchange of commercial information through the means of electronic technology, doesn‟t need to be printed in any stage of the entire transaction process” (Mallik, Susan, 2010). In broad meaning: E-Commerce is the financial and commercial transaction by means of electronic means such as electronic data exchange, electronic money transfer and sending / withdrawing by credit card (Rosen & Anita, 2000). The E-Commerce Model Law of the United Nations Commission on International Trade Law (2010) defines: "The term e-commerce should be broadly understood to cover issues arising from all Commercial systems with or without contracts. Commercial relationships include the following transactions: any transaction in the provision or interchange of goods and services, distribution agreements, 7 representations or commercial agents, commission, long-term lease, construction works, engineering consultancy, capital investment, banking, insurance, concession, joint venture and other forms of industrial or business cooperation, freight or passenger transportation by sea, railway, air or by road. " The definition shows that definition of e-commerce is broad, covering almost all areas of economic activities, in which the purchase and sale of goods and services is only a very small area of ecommerce. Different perspectives have different definitions of e-commerce. (Thomas L. Formatted: Font: 13 pt, Italic Formatted: Font: 13 pt MesenbourgThomas L. Mesenbourg, 2004). Formatted: Font: 13 pt, Italic - In terms of telecommunication: E-commerce is the transmission of information about products and services as well as payments through telephone networks, computer networks or any means. - In terms of the Business Perspective: Ecommerce is the application of technology towards automation in business transactions and workflow. - In terms of the Business Perspectives: Ecommerce is a tool to meet the expectations of companies and customers to cut costs while improving the quality of goods and speeding up the delivery of goods to customers. - In terms of the online landscape: Ecommerce provides the ability to buy and sell services and information online on the Internet. Therefore, e-commerce is divided into: - E-tailing or virtual stores on the web with online catalogs are sometimes grouped into "virtual shopping centers" - The collection and use of personal data through web contacts - Electronic data interchange (EDI), data interchange between enterprises and enterprises - Using email and fax are as a means of accessing and establishing relationships with customers. - Buying and selling between enterprises and enterprises 1.1.2 Components of e-Commerce E-commerce includes the components as shown below: 8 Formatted: Font: 13 pt Figure 1.1: Components of e-Commerce It can be seen in the figure that the infrastructure of E-commerce consists of four main elements: people, public policy, technical standards and organizations. In details: - People include buyers, sellers, managers, servants and intermediaries. - Public policies include laws, tax circulars, and guiding documents. - Technical standards include documents on security and interchange protocols. - Organizations include partners, competitors, associations, committees of the state, government. The management of e-Commerce includes five elements: business services, information distribution, multimedia, computer networks and transactional facilities. In details: - Business services include electronic payment systems, electronic authentication, transactional and security transactions. - Information distribution includes electronic data transmission, email and hypertext. - Multimedia: HTML standards, Java, www, etc. - Computer networks - The main transaction base is the database. 9