Until now, SKF has been the only international bearing company in Vietnam. Mr Schwindling Mr Dong, however, are keenly aware that their international competitors are testing the ma and visiting state-owned enterprises. 'We need to be fully established before the others sel their representative office', says Mr Dong.
A Joint Action Programme is in place to strengthen the SKF Vietnam DID network This continual process of providing support, visiting distributors' areas, helping them to ide customers, and improving stock turnover. More distributors would be added in the futur improve country coverage, but this would require rapid growth in the business. Financial sup would have to increase commensurately. Mr Schwindling and his team also want to s broader dealer network, but this would be the responsibility of the distributors. S distributors such as Nguyen Xuong have ambitions to reach further down the distribution to lower levels of retail customer in the provinces, but this would probably require F discounts that SKF Vietnam would have to finance.
The main thrust of the D/D network is currently towards the afterrnarket, but there are grc signs of activity from Japanese competitors in the OEM market What more can SKF do, . the existing rules of operation in Vietnam, to improve service to customers and raise m share? How best can it block the competition from capturing a share of the market in Vietnam?
clusive dealerships and close customer relationships have been the preferred method of 0peration so far; but competitors (especially the Japanese) are likely to follow Japanese OEM business from Honda, Toyota and others.
Mr Schwindling also needed to consider what would happen if the rules of the game changed. If the government were to change its regulations to allow non-manut companies to set up importing operations, should SKF Vietnam set up a warehouse in Ho Chi Minh City from which to manage its own stock? What if it were to be allowed to distribute as well as import?
finally there was another competitor-related issue to address: would the government maintain a zero rating on import duties for bearings if an international producer proposed to establish a anuf operation in Vietnam? Should SKF Vietnam make a counter-proposal in these circumstances? And if it did decide to manufacture, should it form a joint venture to do so, even though the SKF preference overall is for wholly owned operations?
CHALLENGES FOR THE FUTURE : SKF in Vietnam article from Business Management Catagory CHALLENGES FOR THE FUTURE
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