22:42 (GMT +7) - Monday 11/12/2017

Business

Branding remains problematic for SMEs

Released at: 18:15, 25/10/2017 BUSINESS SPOTLIGHT

Branding remains problematic for SMEs

Photo: Secoin

Change in thinking needed at SMEs regarding developing and protecting brands, according to Association of Vietnamese Retailers.

by My Van

Small and medium-sized enterprises (SMEs) still bear many shortcomings, such as a lack of capital, limited management skills, and poor human resources, which lead to low productivity, while branding isn’t given sufficient attention, according to the Association of Vietnamese Retailers (AVR).

Deputy Minister of Industry and Trade Do Thang Hai said that the construction, development and protection of Vietnamese brand have made remarkable progress since 2003, when the Prime Minister approved a decision to deploy the National Brand Vietnam Program.

Despite changing mindsets about brand building and development, the 98 per cent of Vietnamese enterprises that are SMEs still find it difficult to develop and effectively use their brands.

Most SMEs do not usually research competitive strategies and branding strategies. They are only interested in appearance and forget the foundation value, which is important for brands.

“This is a barrier for Vietnamese brands to advertise and gain a profile among customers in the domestic market, where they compete with imported products and those of multinational corporations,” Mr. Hai assessed.

In addition to specific actions to protect brands, infringements of intellectual property rights remain an issue.

Vietnamese enterprises still face a situation where foreign companies register their famous brands, leading to a loss of some Vietnamese brands on the international market.

In contrast, many enterprises have achieved success with private strategies. The Petrosetco Asset Management Joint Stock Company (PSA) is an example. With the slogan of “Active in Every Case”, PSA has grown steadily over the past ten years, overcoming many ups and downs in the market and recording rapid growth, from VND78 billion ($3.4 million) in 2008 to an estimated VND300 billion ($13.2 million) this year.

Mr. Nguyen Dang Quang, Chairman of PSA, said that from its initial establishment, it began to build brands on a foundation of a corporate culture that includes discipline, self-awareness, and complying with processes. “This creates high quality and prestige,” he said.

Mr. Dinh Hong Ky, Chairman of Secoin, emphasized that the world is changing very fast, with global integration, and tariff barriers are being eliminated completely. In order to integrate, enterprises need to think globally.

“Vietnamese enterprises should have product strategies and make private brands,” he said. “They should also create what the world has not seen already, creating niche markets."

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