Contents Part I. Introduction................................................................................................................................2 Vision................................................................................................................................................3 Missions............................................................................................................................................3 Core value.........................................................................................................................................4 Key Sectors of Business.......................................................................................................................5 Electronics........................................................................................................................................5 2. Mobile Communication................................................................................................................5 3.

Sony Computer Entertainment.....................................................................................................6 4. Entertainment................................................................................................................................6 5. Finance..........................................................................................................................................6 Results of Business Activities..............................................................................................................7 Part II.Business strategies of TNC in Vietnam....................................................................................9 International strategy......................................................................................................................18 Corporate-level strategy.................................................................................................................19 Diversification............................................................................................................................19 BCG Matrix .........................................................................................................................21 Organizational Structure.................................................................................................................25 It is also notable that Sony Electronics Vietnam does not solely apply functional structure, but quite flexible in its management. For specific periods, it establishes project teams specially designed for the making/enhancements of some particular products. Since Sony always appraise activeness and creativity during its operation, this form of product-team structure might appear at times, especially when they need to comply with some arousing needs among the customers or in the process of fulfilling some innovative ideas.....................................................................25 Modes of market entry :................................................................................................................26 Part III. Conclusion and recommendation..........................................................................................31

Part I. Introduction
SONY Corporation, commonly referred to as Sony, is a Japanese multinational conglomerate corporation 1946 Tokyo Tsushin Kogyo K.K. (Tokyo Telecommunications Engineering Corporation), also known as Totsuko, established in Nihonbashi, Tokyo

1958 Company name changed to Sony Corporation Sony listed on TSE (Tokyo Stock Exchange) 1970 Sony shares listed on NYSE (New York Stock Exchange) 1994 Sony Vietnam established 2007 Headquarters relocated to Sony City building 2012 Ranked 87th on the 2012 list of Fortune Global 500

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Vision
Sony is a company devoted to the celebration of life Be the brand of choice in the hearts and minds of customers by delivering the best customer experience

Missions
To experience the joy of advancing and applying technology for the benefit of the public

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Core value

Deliver Excellence by exceeding customers'

expectations, delivering exceptional quality and service, demanding the best from selves, learning from mistakes and celebrating successes Act with Integrity and Work Ethically by owning actions and by having the cage to do what is right for customers and for Sony. Empower - yourself and others by being proactive and giving others the responsibility for decisions that affect their work. Work Together to collaborate and maximize the power of diversity, inspire others to excel and create a culture of joy. Embrace Change by anticipating the future, remaining agile and adaptable, and creating and seizing new opportunities

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Key Sectors of Business

Electronics
The electronics industry emerged in the twentieth century and has now become a global industry worth billions of dollars. Contemporary society uses all manner of electronic devices built in automated or semi-automated factories operated by the industry. This is the main sector that Sony operates in, which contributes to approximately 65% of its market share. In this report, we would focus mainly on this sector. Together with other enterprises such as Samsung, Panasonic, Hitachi, Sony is among the Japanese corporations that are dominating the Vietnam electronics market. Following is the main-stream products that Sony offers. Television Audio Computing Photography The golden hen of Sony, currently well-known as BRAVIATM. We would focus on analyzing this sector throughout this report Sony Walkman Sony Vaio Digital cameras

2. Mobile Communication
In 2001, Sony entered into a joint venture with Swedish telecommunications company Ericsson, forming Sony Ericsson. Sony Ericsson sold a variety of mobile phones before it became Sony Mobile Communications. Sony Mobile Communications AB (formerly Sony Ericsson Mobile

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Communications AB) is a multinational mobile phone manufacturing company headquartered in London, and a wholly owned subsidiary of Sony Corporation. Sony Mobile Communications now focuses exclusively on the smartphone market.

3. Sony Computer Entertainment

Sony Computer Entertainment is best known for producing the popular line of PlayStation consoles. Launched in 1994, the first PlayStation gained 61% of global console sales and broke Nintendo's long-standing lead in the market. Sony followed up with the PlayStation 2 in 2000, which was even more successful.

4. Entertainment
In this field, Sony group is well-known through two of its members: Sony Picture Entertainment (3rd ranking among the movie studios in 2011) and Sony Music Entertainment (the second-largest global recorded music company).

5. Finance
Sony Financial Holdings Inc. is a holding company for Sony's financial services business. It owns and oversees the operation of Sony Life (in Japan and the Philippines), Sony Assurance, Sony Bank and Sony Bank Securities. The company is headquartered in Tokyo, Japan.

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Results of Business Activities 2010

2010 was a hard year to most Japanese enterprises, with the occurrence of the extraordinary earthquake and Tsunami. Sony witnessed a 6.7 % decline in sales and operating revenue. A net loss attributable to stockholders of nearly 40 billion was also recorded. The results were, however, considered encouraging in comparison with the net loss in 2009. This could be seen clearer through the comparison chart of the 3 fiscal years.

2011
Still under impact of the great earthquake, Sony suffered from specific losses. An example was the heavy damage caused on Sony's Sendai Technology Center. However, the company managed to set light to the situation. Operating income saw an increase in comparison with FY 2009. Sales and operating income peaked at 6,034 million, with a notable decline of 6.5% in Euro exchange rate. This decrease was due to a decline in unit shipments as a result of a focus on high-end smartphones and reduction in size of the product portfolio. Income before taxes of 133 million euro was recorded, compared to a loss before taxes of 654 million euro in the previous year.

2012
Sony will change was the most noticeable proclamation. In April 2012, Sony announced that it would reduce its workforce by 10,000 (6% of its employee base) as part of CEO Hirai's effort to get the company back into the green.

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This came after a loss of 520 billion yen (roughly US$6.36 billion) for fiscal 2012, the worst since the company was founded. Accumulation loss for the past four years was 919.32 billion-yen. Sony plans to increase its marketing expenses by 30% in 2012.[54] 1,000 of the jobs cut come from the company's mobile phone unit's workforce. 700 jobs will be cut in the 2012-2013 fiscal year.

Foreign Markets
Sony operates in nearly 180 countries all around the world, employing 158500 people currently. It has services centers in Japan, North America, Europe, East Asia, Pan-Asia and Latin America. There are over 130 factories of Sony around the world in 2012. It is hence notable that Sony does not set a limit to its expansion. The products and services of Sony group might be seen throughout the continents.

(2009 figures)

Sonys main market is the US, with the total value of sales mounting at 2.5 million yen in 2009. This is reasonable for Americas being the worlds top leading economy with huge purchasing power. Sony managed to establish most of its business here, ranging from electronics to financial services and entertainment. China, Japan and Brazil are the markets that follow, which cover well the Asia and America. In the Europe, Sony has established 43 subsidiaries over the countries.

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Part II.Business strategies of TNC in Vietnam

Sony began its operation in Vietnam in 1994 and has been offering numerous streams of products in electronics and related field. In this part, we would mainly discuss the strategies of the corporation in developing its electronics section. Additionally, since Sony maintain its Electronics sector in a too broad sense with many product lines, and as television (CRT and Bravia LCD TV in particular) contributes the majority of revenues in Electronics, in parts of the report we would take the Bravia LCD TV as the representative of the sector and deepen into the strategies that Sony applies for this product. In order to become one of few giant in television industry, Sony has made its own strategies to adapt the changing economic conditions and the culture of each countries they do business. In 1994, Sony brought the trademark to Vietnam. One year later, in December 1995, the first Sonys colored TV was bought in Vietnam market. For 18 years in Vietnam, Sony has step-by-step asserted its position in electronics section and received award of the most trustworthy trademark. How Sony could be successful in Vietnam? By following analysis, we will learn why Sony become successful in Vietnam.

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I. External analysis :

1. Macro-environment analysis :

Macro-environment plays an important role in market analysis to assist managers to make strategies. In order to have comprehensive picture in macro-environment, we will consider the PEST the famous model in analyzing the market. In PEST, we concentrate on four parts: Political, Economic, Social and Technological.

a) Political :
Political factors for Sony Corporation can be changed at any time. The Government holds the power to change any policies and regulations which may affect Sony at the time. Besides, the Government may change or increase trading restrictions which would definitely change the way Sony works. The most important factors on politics are Law on Environmental Protection, Law on employment equality, Law on employing labor, especially the regulations on export-import, the changes of tax law Law on Environmental Protection : Do business in Vietnam, Sony has to obey the regulations to protect environment. In order to adapt, Sony has to apply the measures to handle the four important problems: Global warming : Sony has to reduce energy consumption and emissions causing the greenhouse effect. Natural resources : Enhancing effectiveness of using resources. Chemical Monitor : Monitoring closely the process of using special chemical substances. Natural environment : Protecting the bio-diversificaiton. In order to conform the law, Sony initially must invest to infrastructures, chains of process Law on employment equality and labor :

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Sony is a Japanese company, it has to not only maintain the organizational culture of Japanese one but also adapt the culture of Vietnamese labor. Moreover, Sony brings individual welfare to labors and makes them satisfied.

The changes on export-import tax :

It is externally environmental factor that Sony Vietnam can only control by keeping track of, predict and catch up the changes to make strategies for business operations and marketing. In 1994, Sony did not establish the own company, but through the joint venture mode. By the way, Sony could avoid the 40% of export tax on electronic components which has lowered cost to produce TV. However, in 2004, the tax was small 0-5% which encouraged Sony to import TV instead of producing products.

b) Economical :
Currently the global economy is not in a good position : severe corporate debt in Europe, high rate of unemployment in the United State, the bankruptcy of many large companies worldwide The economic picture has not been ever worse like that. Globalization makes the economy of each countries link closely to each other, Vietnam also has to suffer the same situation. Even the growth rate of Vietnam has still kept in positive rate (5-6%), the economy has been struggling to difficulties for operating the macro-economy in domestics. The interest rate is still in high level, the packages of low interest rate could not touch the company. Besides, the inflation needs to be deliberately considered. The first factor we take into account is interest rate. In 2012, State Bank lowered the rate down to 9%. Because the rate was not attractive as before, people would spend more rather than saving in bank. That has been the positive signal for Sony to enhance the sales volume. Furthermore, the inflation rate was high: 11.75% in 2010 and 18.6% in 2011, causing raw materials to produce TV more expensive. That led the price of products higher making people lower their spending.

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However, a positive growth rate of Vietnam economy for recent years has resulted in higher income and better life conditions. Hence, the spare money in customers pocket has increased, the ability of consumption to high-end products would be satisfactory.

c) Social :
The Vietnamese society has changed a lot in recently years, the life conditions has been better. Many people have the spare money to consume for their house. TV LCD is a high-tech product, sophisticated for fragment of high-salary customers. They are willing to pay even more money to possess a product to prove their position and decorate their house. LCD is high-tech product, so the customers usually are men because they know more specific knowledge on technical parameter of TV than women. Moreover, the product with long-life and high value men would choose and decide purchase. Therefore, Sony should focus potential object on men to enhance advertising effectiveness. For example, it advertises on newspaper or channel men interested in: Sports, Youth or VTC 3, Soccer TV Besides, the consumption habits has significantly changed: the lifestyle toward the enjoy, concern about product quality, more time for entertaining, more money for conveniences making the Sonys TV could penetrate deeply into Vietnam market.

d) Technological :

Sony always researches the new technology to apply in the process of manufacturing: When customers had concern over the environmental protection, Sony tried to research modern technology and process to apply the latest invention in environment protection to reduce the harmful to nature. Sony researches to make its unique technology for developing the products differing to the rivals. Sony us the optimal technology Bravia Engine to bring customers the high quality and real image.

2. Industry analysis :
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Industry analysis is a market strategy tool used by businesses to determine if they want to enter a product or service market. Sonys managers must carefully analyze several aspects of the industry to determine if the company can make a profit selling goods and services in the market. In order to have a comprehensive picture on electronic industry in Vietnam, Sony need to consider famous Porters 5 Forces analysis: Risk of entry by potential competitors, the intensity of rivalry among established companies within an industry, the bargaining power of buyers, the bargaining power of suppliers, the closeness of substitutes to an industrys products.

a) Risk of entry by potential competitors :

In any conditions of economy, the demand for entertainment is still high. Electronics is a delicious cookie which many companies want to get even a small piece. Hence, some companies are willing to enter into the industry anytime if they could. In order to prevent the entrant, Sony has to establish the high barriers to keep them out of the business. Some factors are taken into account:

Economics of Scale :
In the industry, Sony is well-established company, it has achieved the economics of scale because the demand of its products is at high level, they could produce more goods not only to sell but also to gain the cost reduction due to : cost reductions gained through mass-producing a standardized output, discounts on bulk purchases of raw material inputs and component parts, the advantages gained by spreading fixed production costs over a large production volume, the cost savings associated with spreading marketing and advertising costs over a large volume of output. New company want to do business in the industry, it has not gained the economies of scale, therefore the price of its products is higher than Sonys. That makes it not go further! However, some new companies decides to enter on a large scale in an attempt to obtain these economies of scale, it has to raise the capital required to build large-scale production facilities and bear the high risk associated with such an investment.

Brand loyalty :
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The brand name Sony TV has asserted the quality throughout the world. Many people do not need to check the Sony TV, they just come to showroom, pick one and feel secure on the product. That is the prominent advantage Sony has achieved to sell more TV. Other new entrants even provide a cheaper price and the same quality to Sonys, the customer still choose Sony.

Customer switching costs :

TV is a popular product and its feature is to serve the demand of entertainment. If someone does not like the TV of one company, they can choose from other company without bearing any costs.

b) Rivalry among Established Companies :

In the industry, Sony has to identify the rivals, their pros-cons and the threats.

Competition on technology :
Currently, Sony usually considers to collect, analyze and learn about the rivals in some factors : statistics of advertising and discount programs, recruitment to find out the strength and weakness of the rivals. However, in such industry, TV from most of firms has the similar basic features and technical parameter. The most important factor to distinguish among these companies is technology and the utilities of product.

Technology :
Sony exclusively possesses the image processing technology Bravia Engine to bring sharp image due to luminosity, contrast color, details of each pixel and depth. Moreover, the Wide Color Gamut Cold

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Cathode Fluorescent Lamp (WCG-CCFL) technology is also the key for Sonys competition. Samsung the major rival uses the Digital Natural Image Engine (DNIe) technology to utilize movement and color, enhance contrast and detail which bring the natural quality of image. LG uses the XD Engine technology to utilize image on TV : enhance resolution, reduce jam and produce natural image.

Utilities :
TV Sonys LCD has special binaural effect a unique strength of Sony, while Samsungs establishes feature of automatic sound monitor. Besides, LG possesses integrated speaker system and memory of previous sound. Furthermore, Sonys LCD is a product including competitive features: light induction, main and secondary screen, ability of splitting and pausing screen. These features cannot be easily done by other companies, hence creating competitive advantages for Sony.

Product diversification :
Product diversification plays an important role in meeting the varied demand from customers and boosting competition for product. In TV LCD sector, Sony presents 9 models with different sizes : 15 inches to 40 inches, Samsung has also 9 models : 20 inches to 46 inches. While, LG shows 5 models: 26 inches to 42 inches.

Co-operation among rivals :

Competition does not mean separation, the rivals could shake hand to compete other competitors. The tendency is popularly applied in electronics manufacturing industry.

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Sony also applies the strategy by co-operating to Samsung to form LCD-screen manufacturing factory S-LCD worth 2 billion of USD, each party contributes half of capital. This is the modernist screen manufacturing factory with capacity of 600.000 screens per month. In April 2006, both company continued to invest more 2 billion of USD. Therefore, the major electronics firms still compete by co-operating to contribute, take advantage of resources and strength of each party in researching and developing market. Besides, joint venture helps joined companies to reduce costs, risk while achieving new secret of technology.

c) The bargaining power of buyers :

In the TV industry, there are two main groups of buyers: consumers and retailers ( such as : supermarket, electronic store). First, the retailers are very numerous throughout the country like: PICO, Media-Mart, Tran Anh Sony can sell TV to any retailers among them with bearing small bargaining. Moreover, Sony Vietnam forms its own distribution channels: Sony Shop and Sony Center to ensure quantity and quality of products to consumers. If Sony can develop and enhance the effectiveness of distribution system, it could lower even more the bargaining of retailers. Consumers are end-users, so they usually buy one or just small number of TV. That makes them not to have the power of bargaining and accept the price that the Sony or retailers provide.

d) The bargaining power of Suppliers :

Sonys only suppliers are raw materials, plastic, electronic parts and foundry companies who supply Sony with the parts it needs. In Sony Vietnam, components to assemble TV are bought from two sources:

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 Import :
Currently, in order to assemble LCD TV, Sony still has to import approximately 100%. The reason is that LCD is high-end product, required sophisticated level and high-tech. The components have not been produced in Vietnam yet, due to high investment cost on manufacturing system.

Domestics:
Most of domestic components Sony uses are: carton boxes, labels However, the components Sony can buy from many companies. That makes the power of suppliers low.

e) Substitute Products :

In high-tech world, TV is not unique media to bring information to people. Currently, with the fast development of Internet, people can get everything on the Internet; even something does not show on TV. With a computer or any digital device connected to Internet, you could entertain everything. The era of computer and digital device could substitute the role of TV, nevertheless TV has its own features that people love them:

Big screen: People can entertain more comfortable with a big screen TV than
watching on computers.

Furniture: In house, TV plays a role not only as a entertainment device but also
a decorated object for your house. Therefore, TV has quite strong position and could not be substitute completely in near future.

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International strategy
Sony Vietnam applies the multi-domestic strategy. Identify international opportunities Market size: Without FDI, Electronics is considered a young industry of Vietnam, for its humble devotion to the GDP, and the low development level of the domestic market. Vietnamese enterprises are far behind in the race for their slowness in chasing the worlds advancement in research of high technology and exploitation of electronics materials. With such weak domestic power, electronics in Vietnam is a fat land for foreign companies. Reality has proved that, with a total portion of foreign investment mounting at 80% in 2011, and 95% of industry export at the same FY. Return on investment: Electronics in Vietnam is an attractive market for its profitability. The majority of citizens with increasing demand for higher conveniences. Let alone the field of LCD TV, since 2006, with the decrease of tariff on TV, the market was well forecasted to come to a boom. Location advantage: Vietnam is located in Asia region, which is native to China and Japan- where production and assembling factories of Sony are located. This is strategically advantageous for Sony to penetrate. For that, Sony chose the multi-domestic strategy: Design specific lines of products to meet the taste of Vietnamese customers. E.g: kinds of Bravia TV with large screens- which is preferable by local inhabitants. Products of high durability, which copes with the geography traits of the tropical monsoon company. Highly- trained staffs with cozy attitudes toward customers. Also, celebrations and discount periods as per big vacations of Vietnam. The system of service centers and business centers spread throughout the cities, which is designed to cope with the crowded traffic in Vietnam, which serves the easy in transportation and communications. Direct distribution channel through Sony centers, which if applicable to the habits of Vietnamese who want to come see directly the products before purchasing. The stable political situation of Vietnam is also an advantage for operation.

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Corporate-level strategy Diversification

Sony Vietnam mainly operates in the field of electronics. Its product range mainly includes: Bravia TV: Introduced to Vietnam market since, November 2005, after a period of unstable sales to the end of 2006, Bravia LCD TV quickly became the most profitable sector of Sony Vietnam. Sony Vaio: a high-end TM for the laptop products of Sony. The brand name was able to define its position among other low-price competitors such as Dell or Lenovo. Blu-ray video player: a strategic aid for the product stream of HDTV. A device specially designed for higher quality of images. As in pursue of the diversification strategy, Sony Vietnam offers products of other related industries: Photography: DSLR and E-Mount cameras and Handycam video recorders are well-known brand names in the market. Mobile Communication: Sony soon sold the Sony Ericsson mobile phones in 2005. For recent years, it focused on the market for smart-phones with the introduction of X-Peria phones. The product covers appreciable traits such as Reality monitor or HD HDMI- giving high quality of images. Computer Entertainment: As a follow-up of the success of PlayStaion2, Sony introduced its PlayStation3 worldwide.

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Related Diversification cameras, video recorders, mobile phones

Core Electronics Industry

Unrelated Diversification PlayStation3

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BCG Matrix
Takes up 65% of the companys revenue Strategic Business Unit for Sony: Sony Electronics 80% of the cost for production Again, we would take LCD TV (Bravia) as the representative for Electronics and consider its BCG Matrix. We may consider 2 elements: the growth rate of LCD TV market in Vietnam and Bravias (relative) market share: Market growth rate As per statistics of GfK, by figures of 2009, the first quarter witnessed the quantity of LCD TVs sold mounting at 95000 units, equivalent to one third of that in the whole year of 2008. Samsung, as the leading enterprise in the industry (Vietnam and global), its revenue in Vietnam raised by

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80% in comparison with the same period of 2008. However, according to NPD DisplaySearch, during the first 3 months of 2012, the total number of TV reached 51.2 million units, a 8% decline compared to the same period of the previous year. LCD TV contributes 84.2% of the market share for TV. It was the first time LVD TV saw a downward move between the years. However, the total quantity of the product line still equaled 43.1 million- an attractive figure for any investor. With the ever-increasing annual growth rate since 2006, LCD TVs in Vietnam is well considered high. Relative Market Share By June 2012, Samsung was leading the TV market with 26% market share. Sonys share was accounted at 14.6%, which means its relative market share was nearly 0.56 => By the above analysis, Sonys position in the BCG Matrix is Question Mark.

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This is sometimes called problem children, are low-share business units in high-growth markets. They need a lot of cash to keep and increase their share; they can not generate enough cash themselves.

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Business-level strategy
Sony applies differentiation strategy

Value Chain
Operation It is Sonys top guideline to foster creativity and innovations in manufacturing its products. Let alone the Bravia TV, just 6 months after introduction, the company managed to offer a wide range of 9 different Bravia types. Marketing and Sales Marketing-by-mouth (or oral marketing) has been the traditional stategy of Sony for long. As an advantage over the method of mass advertisement, this helps Sony carve more deeply their images into customers mind. Since March 2012, director Howard Stringer decided on a new impulse on Internet marketing, which is a move to cope with the fast space of the wireless-info industry. Service Sony establishes its service centers throughout the country. There are currently 17 Sony centers in Hanoi, Ho Chi Minh city, Hai Phong, Nha Trang, Can Tho and Da Nang. The system of 59 Sony Service centers throughout the country, providing sufficient and careful after-sales and consultant services. Technological Development Surprising is the best word that people agree about Sonys technology. Countless patents are earned by the creative corporation. Hybrid FPA or 3D glasses are among the proud creations of the company. Human Resource Management Sonys agencies are young and innovative people. Pursuant to the old principle of the company, always changing and creating is what its employees attempt to achieve. Sonys philosophy is that the success of the company depends on the skills of its employees. They do not require the workers to be fully- skilled right from the first days. They are offered numerous training programs, through which their abilities and diligence are assessed. Firm Infrastructure Sonys great system of information. The official website for Sony Vietnam is Sony.com.vn. Sony is well reputed for its high-end products. The price level of Sony products is higher than the average of the market. Further analysis of this strategy is discussed in the industry analysis part.

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Organizational Structure
Sony has its subsidiary named Sony Electronics Vietnam, with headquarter situated in Ho Chi Minh city. Just as the name infers, the TNC is not divided into divisions by function, which is unlike Sony Global, with Divisions in many industries. It operates mainly in the field of Electronics. However, Sony Electronics Vietnam operates upon the basis of functional structure and the basis of its whole great system of its Sony Shop and Sony Center. Throughout the country, there are 11 Sony Shop and Sony Center, more than 160 official dealers and 70 authorized warranty stations. Each of these divisions are self-contained and have internal structure. For lack of information, we have not yet managed to provide a full assessment of this organizational structure of Sony Electronics Vietnam. However, it is realizable that this whole system brings major advantages to the corporation: Productivity and specialization are fostered: The functional departments work to their best to make out the work. Reducing the cost of operation: functional and standardization help strengthen the cost structure Better monitoring of work processes: Sony products are well-known for their quality. This is earned partly due to the help of the close monitoring and aiding system

It is also notable that Sony Electronics Vietnam does not solely apply functional structure, but quite flexible in its management. For specific periods, it establishes project teams specially designed for the making/enhancements of some particular products. Since Sony always appraise activeness and creativity during its operation, this form of product-team structure might appear at times, especially when they need to comply with some arousing needs among the customers or in the process of fulfilling some innovative ideas.

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Modes of market entry :

Companies that want to internationalize must decide on a fitting mode of entry into a foreign market in order to make the best use of their resources. It is necessary to understand the context within which a countrys political, economic, and social institutions have emerged, its history, geography, culture, and demography while thinking of emerging in foreign markets. There are many different modes of entering into foreign markets: Exporting; Licensing; Franchising; Joint Venture; Wholly owned subsidiaries. After researching carefully most of aspects, Sony decided to choose the mode: Joint Venture. In 1994, Sony Vietnam formed under the mode of joint venture between Tan Binh Viettronic and Sony Corporation has specialized in assembling and selling popularly electronic products to provide nationwide. The rate of contributing capital is 30% of Vietnam party and 70% of Sony. Legal capital: 2.000.000 USD. A senior of Sony Corporation undertook the General Director of Sony Vietnam. In 1994, in Vietnam, the tax on electronic components was quite high. If Sony had chosen to open its own company, it had to suffer 40% of the tax on imported components. While, forming the joint venture to a Vietnamese company, Sony just paid 15% of the tax ( the legal way to reduce significantly tax payments). Moreover, in that time, the law on foreign company was quite strict and it was hard and timeconsuming to establish the own company. While, the favor of the government for domestic firm was at high level. It facilitated Sony to take advantages of these favors.

By forming joint venture, Sony has gained the advantages :

One more important factor the foreign company want to enter into one countrys market is to understand comprehensively about the culture: demography, domestic demand To Sony, even it had the planned strategies to penetrate into Vietnam, it still was risky to compete alone in the market where Sony had no experiences. By co-operating to Tan Binh Viettronic, Sony could enjoy available knowledge and experiences from Vietnamese party, besides sharing risk of the investment.

Both parties have some performance incentive :

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When two companies contributed capital to establish the joint venture, both had to be responsible for making profit.

Significant control over operations :

In Sony Vietnam, General Director is Japanese who will convey the mission from Sony Corporation to Sony Vietnam. Besides, both party would share power to control better to the segments which each one has the strength.

Each mode of entry has its own weakness, when accepting to form joint venture, Sony has to suffer the drawbacks in process of operating business:

Potential loss of proprietary knowledge: The most important factor to decide the existing and development of a company is in the knowledge the company has possessed. The knowledge includes: experiences in administration and doing business, the core secret of company to develop in long-term, the danger in losing native culture

Potential conflict between partners : In the worst condition of a company, once the parties becomes conflict in benefit, they are willing to use the bad way to harm each other, even the whole benefit of the company. Unfortunately, the potential conflict is usually in the company and the role of good managers is to minimize the conflicts.

Neither partner has full performance incentives: In good condition of economy, both parties could incentives to try to make the best for the benefit of the company. However, when the company faces the obstacles, each party could lose incentives to perform well. That would make the situation worse.

Neither partner has full control: Each party need to be distributed in reasonable position to take advantages of their ability and motivations. If there exists the unfair in power between two parties in operating business, the internal board would not be unified and the task would be harder to accomplish.

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For 16 years, the joint venture of Sony Vietnam has been operating well in competing and gaining the market share in TV industry. Nevertheless, the economic conditions has been changing, in 2010, the joint venture contract was ended. Both party agreed to discontinued the contract. Sony changed the mode of joint venture to wholly owned subsidies Sony Electronics Vietnam Co Ltd100% of capital contributed by Sony Corporation. The move was happened because the following reasons: Sony established the joint venture due to the high import tax of electronic components. However, in 2010, everything was changed, the import tax of the components lowered down to 0-5% by Vietnams commitment to WTO. Moreover, the costs of producing TV in other country rose highly making the profit decrease significantly. While, the import tax for CBU was not too high, then the strategy of switch the mode of market entry was suitable.

The need of focusing more on the quality, because some products produced in Vietnam were not gained the high quality and lost the trust in customers. The imported TV would ensure the quality.

In each stage of penetrating into Vietnam market, Sony made the different strategy of mode entry to adapt the changes in global economy and domestic conditions.

Performances:
In the difficult economy conditions and the severe competition from main rivals: Samsung, LG, then Sony has lost considerably market share for latest three years.

First, we consider the unit sales of total sold LCD worldwide :

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Through the chart we can the positive signal in unit sales of LCD TV, the quantity has increased well from 2009 to 2011. In Vietnam market, the market share of Sony reduced significantly due partly to the sharply increase of Samsung TV:

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2009
26 50 14.6 9.4 Sam sung Sony LG Others

In global market, the market share of Sony occupied a small piece, however, in Vietnam market, the Sonys share was at high level (14.6% in 2009 up to 25.5% in 2011). Even the TV sectors in Sony Corporation was unprofitable, nevertheless it could hope in the emerging market like Vietnam to

enhance the sales of products.

2010
28 Samsung Sony LG 11 20 Others

41

2011
Sam sung Sony LG 14 25.5 Others

33.3

30.2

In order to take back the leading in LCD market, Sony has to re-assert its trademark, make product more diversified to meet more demands and gain breakthrough in presenting new model.

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Part III. Conclusion and recommendation

Current situation of Sony: Based on statistics provided officially, Sony has been suffering from net loss over the past few years. Sony Vietnam, or particularly Sony Electrics in Vietnam, has been unable to meet its targets. Undeniably, the reason for this was partly the impacts of the great earthquake in Japan in 2011 and the global economic crisis. In Vietnam it was clear since 2008 that the pessimistic happenings in the economy was a bad sign for any companys operation, with 2 big crisis (the world crisis of fuel, food price and the crisis of sub-prime mortgage which rooted from the US). However, it is crucial to point out the internal factors that lead to the downturn of the company. The dimming brand After the success of the TV line, Sony could not resist the temptation to expand its business. It developed too many products and lost its brand character. If CocaCola is the representative of refreshers, Facebook is a social net-work, it is hard to define what Sony stands for. Even to Vietnamese people, it is not a uniform image of Sony. It also means the loss of a large number of customers. Lack of focus Sony attempts to introduce too many product lines without focusing on a single stream. The brand name is attached immoderately onto various products, of which not all are gaining good popularity. Many of Sony cell phones, audio devices or computer equipments are sinking into the rise of other brands. This is not good sign for the reputation of the brand. Since the business environment is becoming more and more devolved and professionalized, such moves are just tools to increase the revenue in short term, but bring disadvantages in the long run.

In conclusion, it might be the business strategies of Sony that is causing its problems.
Diversification and differentiation are all good strategies, but might need more correspondence to the situation of the economy. In times of crisis and downturns (ever since the early 2008), Sony might need to reconsider its readiness to expand and invest in innovations. More focus on the brand character and some main-stream products might well be the future strategy of Sony, had it wanted to succeed in the Vietnamese market. Bravia, Vaio, XPeria and PlayStation, which are the main, long-established and most profitable brands, should be of top priority for the coming time.

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References
1. Strategic management - an integrated approach - 9th edition 2010 (charles w. l. hill _ gareth r. jones) 2. http://www.sony.com.vn/section/home 3. http://vi.wikipedia.org/

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