UNIVERSITY OF APPLIED SCIENCES NORTH WESTERN SWITZERLAND SCHOOL OF BUSINESS

MASTER’S DEGREE THESIS

Enhance the efficiency of seafood supply chain at Hai Vuong
Group (HVG)
Author : Le Thi Ngoc Chau
Supervisor: Nguyen Thi Duc Nguyen

Ho Chi Minh, July 2017

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TABLE OF CONTENT
TABLE OF CONTENT .............................................................................................................................................................. 2
LIST OF FIGURE ..................................................................................................................................................................... 4
LIST OF TABLE ........................................................................................................................................................................ 5
CHAPTER I: INTRODUCTION ............................................................................................................................................. 6
1.1 BACKGROUND ........................................................................................................................ 6
1.2 GENERAL OBJECTIVES ........................................................................................................ 7
1.3 PROBLEM ANALYSIS ............................................................................................................ 7
1.4 SCOPE AND LIMITATIONS .................................................................................................. 8
1.5 MEANING OF THE RESEARCH ........................................................................................... 8
CHAPTER II: LITERATURE REVIEW .............................................................................................................................. 10
2.1 SUPPLY CHAIN CONCEPTS ............................................................................................... 10
2.2 SUPPLY CHAIN MANAGEMENT CONCEPTS ................................................................ 12
2.3 SUPPLY CHAIN DECISIONS ............................................................................................... 13
2.3.1 Production....................................................................................................................................... 14
2.3.2 Inventory......................................................................................................................................... 15
2.3.3 Location .......................................................................................................................................... 15
2.3.4 Transportation................................................................................................................................. 15
2.3.5 Information ..................................................................................................................................... 15
2.4 SCM EVALUATION MODELS ............................................................................................ 16
2.4.1 Supply Chain Operations Research (SCOR Model) ....................................................................... 16
2.4.2 David Taylor Model (2003) ............................................................................................................ 21
2.4.3 Material Requirement Planning (MRP) Model .............................................................................. 21
2.5 COMPARISON OF SUPPLY CHAIN FRAMEWORKS .................................................... 21
2.6 TYPICAL SUPPLY CHAIN PROCESS IN SEAFOOD INDUSTRY ................................ 23
CHAPTER III: RESEARCH METHOD .............................................................................................................................. 25
3.1 RESEARCH PROCESS .......................................................................................................... 25
3.2 RESEARCH METHODS ........................................................................................................ 26
3.3 RESEARCH MODEL ............................................................................................................. 27
CHAPTER IV: CURRENT SITUATION AT HVG & SCM ANALYSIS ............................................................................ 29
4.1 HGV CURRENT SITUATION............................................................................................... 29
4.1.1 Company overview ......................................................................................................................... 29
4.1.2 Evaluate SCM at HVG based on SCOR ......................................................................................... 40
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 4.2 ANALYZE CAUSES AFFECTING SC AT HVG ................................................................ 43
4.2.1 Pareto analysis ................................................................................................................................ 43
CHAPTER V: HVG GOALS AND RECOMMENDATIONS .............................................................................................. 49
5.2 THE DEVELOPMENT PERSPECTIVE OF THE COMPANY ........................................ 49
5.2 RECOMMENDATIONS ......................................................................................................... 49
5.2.1 Facility improvement ...................................................................................................................... 50
5.2.2 Diversity relationship with suppliers .............................................................................................. 50
5.2.3 Standardize purchasing department ................................................................................................ 50
5.2.4 Apply technology system in SCM activities .................................................................................. 51
5.2.5 Train the admin team on supply chain management ...................................................................... 51
5.2.6 Develop an improvement plan and re-organize the chain .............................................................. 51
5.3 SUMMARY RECOMMENDATIONS................................................................................... 52
CHAPTER VI: CONCLUSION............................................................................................................................................. 54
REFERENCE ........................................................................................................................................................................ 56
APPENDIX ............................................................................................................................................................................ 58

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LIST OF FIGURE
FIGURE 2.1: THE SUPPLY CHAIN COMPETITIVE FRAMEWORK .................................................................. 11
FIGURE 2.2: SUPPLY CHAIN NETWORK..................................................................................................... 12
FIGURE 2.3: FIVE DOMINANT DECISION AREAS IN SCM ............................................................................ 14
FIGURE 2.4: TYPICAL SUPPLY CHAIN FRAMEWORK ................................................................................. 17
FIGURE 2.5: HVG’S SUPPLY CHAIN PROCESS IN DETAIL ........................................................................... 24
FIGURE 3.1: SCM AT HVG RESEARCH PROCESS....................................................................................... 25
FIGURE 3.2: RESEARCH MODEL ................................................................................................................ 28
FIGURE 4.1: HVG’S ORGANIZATIONAL STRUCTURE ................................................................................. 30
FIGURE 4.2: DIAGRAM OF THE PURCHASE PROCESS AT HVG.................................................................... 31
FIGURE 4.3: SEAFOOD SUPPLY CHAIN ....................................................................................................... 32
FIGURE 4.4: THE STANDARD PRODUCTION PROCESS OF HGV ................................................................... 33
FIGURE 4.5: ORDERS MANAGEMENT PROCESS AT HVG ............................................................................ 34
FIGURE 4.6: PARETO ANALYSIS CHART REGARD TO CAUSES ..................................................................... 44
FIGURE 4.7: PARETO ANALYSIS REGARDING TO COSTS. ............................................................................ 45
FIGURE 4.8: TRACING CAUSAL MODEL ..................................................................................................... 46
FIGURE 4.9: PRODUCT QUALITY FISHBONE ANALYSIS .............................................................................. 47

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LIST OF TABLE
TABLE 2.1: COMPARISON SUPPLY CHAIN FRAMEWORKS ........................................................................... 22
TABLE 4.1: FACILITIES AT HVG ............................................................................................................... 30
TABLE 4.2: QUANTITY AND QUALIFICATION OF EMPLOYEES IN HVG ....................................................... 31
TABLE 4.3: QUANTITY OF FROZEN FISH IMPORTED FROM 2013 – 2016 ..................................................... 32
TABLE 4.4: EXPORT TURNOVER FROM 2013 TO 2016 ............................................................................... 35
TABLE 4.5: EXPORT TURNOVER FROM WITHIN THE FIRST FIVE MONTHS OF 2017...................................... 35
TABLE 4.6: PERFECT ORDER FULFILLMENT AT HVG ................................................................................ 36
TABLE 4.7: COST OF DELAYED CARGOS .................................................................................................... 36
TABLE 4.8: COST OF RETURNED CARGOS .................................................................................................. 37
TABLE 4.9: BREAKDOWN THE EFFICIENCY OF BUSINESS ACTIVITIES ........................................................ 38
TABLE 4.10: HVG’S ACHIEVEMENTS AND CURRENT ISSUES ..................................................................... 40
TABLE 4.11: SUMMARIZE INTERVIEW RESULTS ABOUT HVG’S CURRENT ISSUES ..................................... 42
TABLE 4.12: PARETO ANALYSIS BY CAUSES ............................................................................................. 43
TABLE 4.13: PARETO ANALYSIS BY COST ................................................................................................. 44
TABLE 4.13: IDENTIFY ROOT CAUSES USING 5WHYS ANALYSIS .............................................................. 48
TABLE 4.14: SUMMARY RECOMMENDATION FOR IMPROVING HVG’S SCM ............................................. 52

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 CHAPTER I: INTRODUCTION
1.1 BACKGROUND

According to Foreign Investment Department (2016), the world economy is losing the momentum.
Global growth is projected at only 2.4%, down sharply compared from the 2.9% forecasted at the
end of last year. There were some factors affected the world economic development such as
weakness in total demand, long-standing capital in major economic sectors that limit global growth,
price of oil and other commodities are decreased which affect exporting countries. In addition, the
risks of falling commodity prices in global economic remain high in near future and occur while
total demand remains, investment and price of goods are low.

Enterprises are facing with various difficulties in economic recent years, due to unsold goods, high
inventories and shortage raw material for production, etc. The missions for enterprise survive and
force the organization to rise up and create advantage for today and the future. Wants to revive that
situation, the company must know how to reorganize from the input to the output, capture company
products from production to customers, finding the best solution aims to reasonable prices, optimal
production and enterprise administrator must know their own supply chain.

Yellowfin tuna is an export commodity with high economic value, contributing significantly to the Commented [H1]: Nên có đoạn chuyển ý

growth of seafood export turnover in Vietnam. However, from the end of 2014 until now, the
activities of fishing, purchasing, processing and consumption of tuna meet many difficulties. Tuna
producers and exporters are facing huge challenges such as unstable raw materials supply, strict
requirements on quality of consumers, Food safety standards of the Ministry of Fisheries, IUU
regulation on traceability and producing environmentally friendly products. Faced with that Commented [H2]: Chưa có reference

situation, the State and businesses should organize, manage, exploit, procure, process and consume
Yellowfin Tuna in order to stabilize the inputs, increase the quality of goods to increase value for
consumers.

Being in the system of companies producing and exporting seafood with the main item is Yellowfin
Tuna, Hai Vuong Group has been expanding its production activities for many years. It is now one
of the leading tuna exporters at Khanh Hoa province. However, the company also faces challenges
in the supply of tuna. The company's material purchasing activities are mainly through
6
intermediaries, so it is affected by inappropriate value and lack of linkage with fishermen. Wishing
to help the company find solutions to enhance the supply chain in order to be more active in raw
materials, better control the quality of products, improve competitive advantage, the topic has
chosen: “Enhance the efficiency of seafood supply chain at hai vuong group (hvg).”

Although HVG developed a detail framework for their SC (Figure 2.5.2), managing the efficiency Commented [H3]: Nên để bản 2.5.2 vào đây luôn, vì phần
background k nên link data qua đoạn khác.
of the whole chain was still a challenge. Therefore, SCM system at HVG has to be review to
Commented [H4]: source
maintain current position, improve the competitive ability, reduce the production costs and expand
market share.

In order to solve the research problem, SCOR, David Taylor and MRP method will be analyzed in
literature review and one of them will be selected to evaluate the SCM at HVG.

1.2 GENERAL OBJECTIVES

1. Evaluating the current supply chain management system in HVG.

2. Identifying issues and potential risks in current SCM system.
3. Proposing a SCM improvement solutions and action plans for enterprise in short term and long
term.

1.3 PROBLEM ANALYSIS Commented [H5]: Objective vs Problem analysis question

phải link với nhau
As described in the background, supply chain management has gained more and more attention
during the last four decades. It has been raised the demand for being able to measure the supply
chain at the same time, implying that the necessary for finding new ways to measure performance
has increased. A first step towards this mission is to obtain an understanding of what drives supply
chain performance. Hence, the first research question is:

RQ 1: What factors influence supply chain performance of HVG?

In order to be able to complement existing research literature with a new framework of how to
measure supply chain performance there is also a need to understand and study current ways and
approach of how to measure the performance, especially in a supply chain context. Therefore, the
second question that needs to be answered is:

7
RQ 2: What current methods exist when measuring performance of HVG in a supply chain
context?

Collecting and categorizing measures is just one important aspect of increasing supply chain
performance. Another relevant issue, which also needs to be considered, is how organizations apply
measurement method. Hence, the final research question read as follow:

RQ 3: How should performance measures is applied HVG in order to improve supply chain
performance?

1.4 SCOPE AND LIMITATIONS

Supply chain management (SCM) is a broad topic, so it requires a lot of time, effort and resources
for the study. In this kind of large enterprise as HVG, this study focuses mainly on the supply chain
in seafood processing: input supply, production, storage and distribution.

Due to Yellowfin Tuna (YT) account for 80% of the production, thus the research will mention the
SCM of YT at HVG only.

1.5 MEANING OF THE RESEARCH Commented [H6]: Sửa lại thành: “IMPLICATION”

Up to now, this is a serious research about Supply chain management in HVG. The purpose of this
research is bringing great meaning to the company as well as their partners:

For the author

Consolidate the knowledge of competitive advantage, supply chain and value chain has been
enrolled in a master’s program in business practice.

Strengthen the author’s skills in the study of supply chain from procurement, processing, export and
distribution...

For HVG

Provide managers a general model for optimizing the coordination activities from raw materials to
final products. There is a scientific basis with real data, to consider and which can make needed
decisions for enterprise to achieve objectives.
8
Help the stages in supply chain linked together to form a solid chain advantages in traceability of
products, to meet the increasingly strict requirements from hard markets, increasing customers’
satisfaction and stakeholders through improved relationship in the supply chain to create
competitive advantage.

Highlight the gaps exist in the supply chain operations, the problems need to be changed to help
company sustainable development.

Give the supply chain model in line with the Global GAP standard which other enterprises in
Vietnam can take as a reference.

For partners and end buyer

Vendors benefit when the model is done through: priority of payment policy, delivery deadlines,
materials information, fishing grounds, fishing seasons, fishing methods and plans predict the
fluctuations in market price which is provided continuously and relatively accurately.

Customer satisfaction and trust will increase because of good offer price, product quality, payment
terms and transport time.

9
 CHAPTER II: LITERATURE REVIEW
2.1 SUPPLY CHAIN CONCEPTS

Nowadays, in order to survive and sustain growth, many enterprises are force to expand their
market share globally. In the meantime, these enterprises have to defend local market share from
international competitors. In order to deliver product to clients who require products in a speedily
and dynamic changing set of channels, how to widen the distribution network worldwide is a
challenge. It is essential for setting strategic positioning of inventory, so that the availability of
product will satisfy customers’ demand.

“ Domenica (2002) also guaranteed that the supply chain should actually be efficient and effective.
For this situation, efficient intends to limit asset use to achieve particular results; and effective, in
term of outlining distribution channels. Efficiency is measured by delivery performance, quality of
product, inventory levels and backorders, whereas effectiveness is measured by quality of product
and the service requirements.

Long-term competitiveness therefore relies on upon how well the organization meets client
preferences regarding service, quality, cost and adaptability, by planning the supply chain, which
will be more efficient and effective than the contenders'. Optimization of this equilibrium is a
steady challenge for the organizations which are which are part of the supply chain network, show
in Figure 2.1.

To be able to optimize this equilibrium, a lot of strategic decisions and activities must be taken and
facilitated. This requires careful management and supply chain designing. The design of supply
chains comprises to a distinct means by which organizations innovate, create value and differentiate
(Longtitudes, 2004). The challenge of supply chain planning and administration is the ability to
outline and assemble resources, skills, organizations, and competences. It envelops the partners,
teams, products, and procedures.

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 Source: Ernst, 2002
Figure 2.1: The Supply Chain Competitive Framework

To comprehend the terms of supply chain management inbound and outbound, first the terms of
supply chain will be explained, then define the supply chain management.

According to Mentzer, et al. (2001) the meaning of "supply chain" is more consolidated as supply
chain management definition. In his paper, he attempted to make a typical definition of a supply
chain, based on a comprehensive research examine led by a few co-authors. They came up with the
following definition: “A supply chain is defined as a set of three or more entities (organizations or
individuals) directly involved in the upstream and downstream flows of products, services,
finances, and/or information from a source to a customer ".

The supply chain may comprise internal divisions of the organization and also external suppliers
that give contribution to a focal organization. A supplier for this organization has his own
arrangement of suppliers that provide input (additionally called second level providers). Supply
chains are basically a progression of connected suppliers and clients until products reach the
ultimate customer (Handfield, 2002).

Supply chain of an organization comprises of an upstream supplier system and its downstream
distribution channel (Figure 2.2). Organizations part of numerous supply chains.

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Contingent upon how complex the supply arrangement is, Mentzer, et al. (2001) characterized three
sorts of supply chains:

1. Direct supply chain, which comprises of an organization, a client and a supplier.

2. Extended supply chain, which includes suppliers of the immediate supplier, and also clients of
the immediate client.

3. Ultimate supply chain, which includes every one of the organizations required in all the
upstream and downstream flows. ”

Source: Handfield 2002

Figure 2.2: Supply Chain Network

2.2 SUPPLY CHAIN MANAGEMENT CONCEPTS

Although industry and academia have investigated the concepts of SCM for the last decade, there is
no consistent definition of the concepts. As a result there is generally a lack of consistency in
meaning and clarity across the diverse definitions of Supply Chain Management available in
literature. Some of them are listed further on.
Lambert, Stock and Ellram (1998) stated that the coordination of business procedures from end
customers to add value for them through providing products, services and information.

12
In macro logistics, according to Scott and Westbrook (1991) “the systematic effect to provide
integrated management to the supply value chain in order to meet customer needs and expectations,
from suppliers of raw materials through manufacturing and on to end-customers”.

However, Ganeshan and Terry (1995) said “A supply chain is a network of facilities and
distribution options that performs the functions of procurement of materials, transformation of these
materials into intermediate and finished products, and the distribution of these finished products to
customers”. In fact, departments in HVG is mostly focus on fulfill their tasks rather than work with
other departments to consider balancing the risks. As a result, this leads to lost in transportation
cost.

Another statement is about stages involved in the supply chain directly or indirectly in fulfilling
customer’s requirements. There is not only manufacturer and suppliers involved in the supply
chain, but also warehouse, transporter, retailers and customers themselves (Chopra and Meindl,
2001).

Overall, all above concepts and definitions is about the connection between suppliers: from input to
producing and deliver final products to end buyers. According to Chopra and Meindl’s 2001, they
specifically stated that there was many business played a vital role in directly satisfy customer’s
needs such as producers, suppliers, distributers and there were some indirect business affected
SCM. They are service businesses that distribute finished goods to end customers, for example
transporters, warehouses, agencies and consulting companies. They support direct businesses SCM
by offering the best services to end buyers with low costs.

2.3 SUPPLY CHAIN DECISIONS

Every product type towards particular market needs and facing with diverse challenges, thus, the
characteristic of Supply chain for each product will be different. However, any SC would also face
with similar basic problems and would be solved based on typical decision areas.

According to Ram and Terry (1995), the decisions for SCM are classified into two broad
categories: operational and strategic. As the term implies, operational decisions focus on daily
activities and are short term. In contrast, strategic decisions are connected with corporate strategic
13
and typically made over a longer time horizon. In the strategically planned supply chain, the efforts
in these types of decisions are efficiently and effectively manage.

There are five dominant decision areas in SCM (Figure 2.3).

Source: Ram G. and Terry P. (1995) Commented [H7]: APA reference?

Figure 2.3: Five dominant decision areas in SCM

2.3.1 Production

The strategic decisions include what products to produce, and which plants to produce them in,
allocation of suppliers to plants, plants to DC's, and DC's to customer markets (Ram and Terry
1995). As before, these decisions have a big impact on the revenues, costs and customer service
levels of the firm. These decisions assume the existence of the facilities, but determine the exact
path(s) through which a product flows to and from these facilities.

Another critical issue is the capacity of the manufacturing facilities--and this largely depends on the
degree of vertical integration within the firm. Operational decisions focus on detailed production
scheduling. These decisions include the construction of the master production schedules, scheduling
production on machines, and equipment maintenance. Other considerations include workload
balancing, and quality control measures at a production facility.

14
 2.3.2 Inventory

According to Ram and Terry (1995), Inventory available throughout the supply chain and includes
everything from raw material to work in progress to finished goods.

Regarding to creating and holding inventory, there are three essential decisions to make: safety
inventory, cycle inventory and seasonal inventory.

2.3.3 Location

Location related to the way of setting supply chain facilities based on geographic.

It also includes the decision related to which activities should be performed in each facility.

Decisions related to location have significant effect on the cost and performance of supply chain.
Therefore, decisions about centralize or decentralize activities will be trade-off to gain economic of
scale and efficiency as well as close to customers and suppliers.

2.3.4 Transportation

Transportation prefers to movements between different facilities and from raw material to finished
goods in supply chain.

Transportation includes different modes: truck, rail, pipelines, airplanes, ship and electronic
transportation.

2.3.5 Information

All decisions are based on timely availability of information regarding other four supply chain
drivers.

Information is used for two purposes in supply chain; coordinating daily activities and forecasting
and planning to anticipate and meet future demands.

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2.4 SCM EVALUATION MODELS

In fact, there are many models to evaluate, manage and improve the efficiency of supply chain. The
most well-known is the SCOR model (Supply chain operation reference, 2001), MRP model
(Heizer/Render, 2008) and David Taylor (Taylor, 2003).

People often combine multiple indicators of different models to match the objectives and specific
characteristics of each chain.

2.4.1 Supply Chain Operations Research (SCOR Model)

SCOR is a typical model, gives a guidance framework for developing supply chain structures. This
is considered as a platform model to analyze and measure the efficiency of supply chain.

SCOR Model was developed by The Supply Chain Council (2006). This model is design to support
supply chain partners communicate with each other effectively. The scope of SCOR model is
“From company’s supplier’s supplier to company’s customer’s customer” (Supply Chain Council,
2006).

Advantages: it can be customized to fit the specific supply chain of almost any organization. There
is five distinct management processes (Table 2.3.1) and each of them is implemented in four levels
of detail.

“ Each level will define different function of the model. Level one defines the number of supply
chains as well as what metric will be used. Level two defines the planning and execution process in
material flow. Level three defines the inputs, outputs and flow of each transitional element
(Lambert, 2005).

Besides, SCOR model has four basic indicators: responsiveness, reliability, costs and assets which
used to measure the performance.

Start from level 1 and end from level 3, the content of SCOR model can be applied to transform
business strategy into a supply chain structure that serves specific objectives.

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 SCOR MODEL: DISTINCT MANAGEMENT PROCESSES

This model is a standard diagnostic tool to analyze the supply chain performance and identified by
5 factors (Peter & Robert 2007) (Figure 2.4).

Supply Chain
Supply Chain

Plan

Customer
Customer processes
Supplier processes

processes
Source Make Deliver

Return Return

Source: Peter & Robert 2007

Figure 2.4: Typical Supply Chain Framework

o Plan:
The processes that balance aggregate demand and supply to develop the course of action which
best meets sourcing, production and delivery requirement. There are three types of Plan:
- Strategic plan: planned by senior managers about long terms objectives. It supports guiding the
organization’s activities.
- Tactical plan: planned by middle managers for implementation of the strategic plan into
department activities (mid-term plan).
- Operational plan: it is a short term and detailed plan. Departments will be responsible for this.

o Source:

The processes procure goods and services to meet planned or actual demand (Shepherd, Günter
2012). There are three sub-processes:

- Find sources for inventory production

17
- Find sources for order production
- Find sources for design by order

o Make:

Activities included in this process are production, design, new product testing, packaging and
storage (Arthur 2012).

o Deliver:
This is executed on distribution channel. Order management, transportation and warehousing
are included in this process.
The structure of distribution will be depended on product characteristics, product life cycle and
distance from warehouse to customers.

o Return:
The company has to prepare for handling return cases such as return containers, defective goods
and packaging (Magnusson 2010). It comprises two sub-processes:
- Handling claims on the defective goods, shortage or surplus.
- Recall and handle all returned goods/ services.

 Management Processes Levels

Level 1
This level focuses on five major supply chain processes: Plan, Resource, Make, Deliver and
Return (Supply Chain Council, 2006). It characterizes performance of the supply as a whole,
define the basic of competition and enable the setting of business wide performance targets.

Level 2
The company needs to refine supply chain process selection and determine the compatibility
between infrastructure and processes (including factories, machines, locations of equipment,
information technology system). This is done through the selection of the sub-processes,
regarding to supply chain strategic (Supply Chain Council 2006).

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 Level 3
This level defines the Company ability to successfully compete within its chosen market. It
consists of:
- Process element definition
- Process elements I/O info
- Process performance metrics
- Best practices if applicable
- System ability to support best practices
Companies “adjust” their operating strategies on Level 3.

Level 4
Implementation of specific SCM practices. Level 4 defines practices used to reach competitive
advantages and adapt to constant business environment changes. This level is out of scope.

 Performance Measurement.

SCOR metrics focus on five performance attributes (Ganga, 2011):

o Delivery reliability
This attribute is used to evaluate whether the correct product is delivered to correct place, in the
correct quantity, at the correct time, with the correct document and to the right customer.
Delivery Performance is also called On-time Delivery (OTD):
𝑢𝑛𝑖𝑡𝑠 𝑜𝑟 𝑜𝑟𝑑𝑒𝑟𝑠 𝑑𝑒𝑙𝑖𝑣𝑒𝑟𝑒𝑑 𝑜𝑛 𝑡𝑖𝑚𝑒
% OTD = 100%
𝑡𝑜𝑡𝑎𝑙 𝑢𝑛𝑖𝑡𝑠 𝑜𝑟 𝑜𝑟𝑑𝑒𝑟𝑠 𝑠ℎ𝑖𝑝𝑝𝑒𝑑

Each participant in the chain has to complete their tasks on time, since one order being late properly
increases the chances of next order being late (Viswanadham, 2000).

o Flexibility
The ability to meet customer demands under various environmental uncertainties in various
dimensions. There are four dimensions:
19
- “ Customers service flexibility: The ability to provide the customer inquiries and requests. ”

- Order flexibility: The ability to adjust order size, volume or composition during logistics
“

operation. ”

- Location flexibility: The ability to service customers from alternative locations.

“ ”

- Delivery time flexibility: The ability to provide delivery times for customers.
“ ”

o Cost
Since several organizations involved, it is not easy to obtain supply chain cost (Ganga, 2011). Each
organization measures on monthly or quarterly basic costs: selling expenses, facilities costs,
management cost, ect.

o Asset

Inventory cycle/Stock cycle: average inventory that builds up in the supply chain because a supply
chain stage either produces or purchases in lots that are larger than those demanded by the
customer.

𝑄
Inventory Cycle =
2
Q = lot or batch size of an order

Inventory Days of Supply (IDS): is an efficiency ratio that measures the average number of Days
the enterprise holds it inventory before selling it.

𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑡𝑜𝑡𝑎𝑙 𝑖𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦

IDS =
𝐶𝑜𝑠𝑡 𝑜𝑓 𝑔𝑜𝑜𝑑𝑠 𝑠𝑜𝑙𝑑−𝐸𝑎𝑟𝑛𝑒𝑑

Asset Turnover: shows how efficiently a business uses its assets to generate sales

𝑅𝑒𝑣𝑒𝑛𝑢𝑒 (𝑆𝑎𝑙𝑒𝑠)
Asset Turnover =
𝑁𝑒𝑡 𝑎𝑠𝑠𝑒𝑡𝑠

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 2.4.2 David Taylor Model (2003)
David Taylor indicated four indicators to determine the performance: time, cost, capacity and
efficiency. Each indicator can be measurable and time is almost mentioned first.
Advantages Disadvantages
4. Can measure on: production processes, 9. Too many indicators to measure lead
the chain capacity, ability to use to time consuming in research and
resources as well as operational make decision.
efficiency. 10. No standard for indicators.
5. Detailed and specific. 11. Lack of criterion for measuring the
6. Measure based on internal and flexibility of the chain.
external activities.
7. Criteria allocated reasonable and easy
to apply.
8. Useful in process analysis.

2.4.3 Material Requirement Planning (MRP) Model

MRP is model of planning material used in production. It applied effectively in mass production
lines (Kevin, 2014).
Components of model:
o Master production schedule
o Bill of material
o Inventory
o Production time
Advantages Disadvantages
12. Improve production plan and 15. Inflexible in production plan.
production management. 16. Required large and accurate
13. Wide application range, handling information.
inside and outside the supply chain. 17. High investment: expensive hardware
14. Broad database due to comprehensive and software.
and complex computer system. 18. Long preparation: about 5 years

In this research SCOR model will be applied in HVG case, because it matches with the
purposed of the current state HVG.

2.5 COMPARISON OF SUPPLY CHAIN FRAMEWORKS

21
Table 2.1: Comparison supply chain frameworks
Criteria SCOR (2006) David Taylor (2003) MRP (2014)
Scope Strategic Operations strategy Operations strategy and
driver Functional strategies.

Breath All transactional All activities associated All activities related to

of activities related to with time, cost, capacity Master production
activities demand-supply and efficiency schedule, Bill of
planning, sourcing, materials, Inventory
production, distribution and production time
and reserve logistics

Drivers of value Cost reduction and Process analysis Improve production

generation asset utilization plan and management

Advantages Used to identify supply Detailed and specific. Enhance production

chain problems. plan and management.
Criteria division is
Measure many levels of reasonable and easy to Wide application range.
process detail. apply. Wealthy information
and large storage
Measure performance Useful in analyze system.
flexibility and analyze processes.
into individual
quantifiable elements.

Disadvantages Time consuming because Inflexible in production

Mainly measure
of evaluate many plan.
performance results
indicators.
(efficiency) rather than Require huge and
performance of the Criteria given are accurate information.
processes. samples, not standard
parameters. High cost for
Cannot evaluate equipment invests.
customer satisfaction Lack of criteria for
and loyalty. measuring the flexibility. Take 5 years to prepare
and apply
Source: by author

22
 2.6 TYPICAL SUPPLY CHAIN PROCESS IN SEAFOOD INDUSTRY

According to FAO (2006), they defined that a typical seafood supply chain includes production,
aquaculture, preliminary processing, product processing and distributing to end user (Figure 2.5).

Harvesting Initial Product Wholesales Retails Consumer

processing processing

Source: FAO 2006

Figure 2.5: Typical seafood supply chain

This typical model has six basic processes for seafood supply chain: (1) activities related to fisheries
and aquaculture of fisherman, (2) initial processing activities, (3) activities of processors include
producing the products, (4) activities of wholesalers, (5) retailers’ activities and (6) consumers.

Figure 2.5 shows the supply chain process at HGV in detail which including sub-processes. As the Commented [H8]: Chuyển nguyên đoạn nói về HGV này
qua Chapter 4
Harvesting is not included in this process, so the Company mainly focuses on purchasing raw material,
production management and customer relationship management. Each sub-process will have separate
department control the working process. However, every time uncertainties arise, those managers
offend report directly to Director for solutions.

23
 Source: HGV Group
Figure 2.5: HVG’s supply chain process in detail

24
 CHAPTER III: RESEARCH METHOD
3.1 RESEARCH PROCESS

Source: by author
Figure 3.1: SCM at HVG research process Commented [H9]: Goal 2 và 3 phải sửa lại như hình (hình
này em sửa lại rùi, anh chị copy lại thôi nhe)

25
3.2 RESEARCH METHODS

This research paper is based on objectives to conduct the empirical research. Quantitative and
qualitative are two basic research methods, which act as a mean in analyzing collected data.
Being more detail, it is mainly used to explore, interpret and understand the phenomenon deeper
for example interview, focus group discussion and observation. To address the research
questions, qualitative and quantitative methods has been used in this research. In contract,
quantitative research is better than quantitative research, due to investigating, interpreting and
understanding the phenomenon better. Consequently, the researcher will apply both quantitative
and qualitative approach to support the research formulation.
- Step 1: SCM theories will base on newspapers, books, journals, specialized sites (Vietnam
association of seafood exporters and producers (VASEP), Ministry of Agriculture and Food
Department (NAFIQAD)…) and relevant research results have been published.
- Step 2: Research and describe current operation status of the SCM at HVG: direct interview
leaders, managers and employees and departments related to SCM.
- Step 3: From the research results, the author will analyze the governance practices towards
activities: input supply, production, storage, distribution. Then, make the comparative
analysis with the function of supply chain. The research report is a combination of
information from interview and secondary clarified. Since then, some solutions will be
suggested to improve the governance practices in the supply chain of HVG.

Secondary data:

No. Information Purpose Source Timeline Data Processing Methods

1 Concepts Theoretical Newspapers, Nov., 2016 Select theories related to
related to SCM basic, clarify Internet, - SCM
goal 1 Books Jun., 2017
2 SCM studies Theoretical Newspapers, Nov., 2016 Compare methods applied
close to the basic, clarify Internet, - from other companies and
research topic goal 1 Books, Jun., 2017 draw a specific SCM
available
studies

26
 3 Theoretical Evaluate Newspapers, Nov., 2016 Compare SCM methods
basic and current state of Internet, - from previous researches
applications of SCM at HVG Books, Jun., 2017 to evaluate current
SCM database situation of SCM at HVG
Evaluation and select appropriate
Models method for HVG

4 Report the Compare Internal Nov., 2016 Statistical evaluation of

operation of Indicators to reports, - annual growth rate
HVG from evaluate and weekly Jun., 2017 Statistical comparison to
2013 to 2016 identify causes report from find out weaknesses of
departments, HVG in SCM
annual
report
Source: by author

Primary data:

No. Information Purpose Source Timeline Data Processing Methods

1 The interview Identify causes, Experts Nov., 2016 Analyze, compare the
questionnaire suggest SCM - efficiency of SCM
consulted the improvements Jun., 2017
SCM
Coordinators
2 The interview Identify causes, Newspapers, Nov., 2016 Analyze, compare the
questionnaire suggest SCM Internet, - efficiency of SCM
consulted the improvements Books, Jun., 2017
SCM available
Participants studies
Source: by author

3.3 RESEARCH MODEL

According to literature, the study identified five fundamental factors are affecting the SCM at
HVG: Plan, Source, Make, Distribution and Return. Additionally, those main factors include sub-
factors: forecasting demand, Product pricing, Inventory management, Source, Finished goods
Procurement, Credit & receivable, Product design, New product testing, Packaging & storage,
Orders management, Distribution plan and Transportation. Root causes will be identified through
analyzing those sub-factors by problem solving tools: Pareto diagram, Fishbone Diagram and
5Why. As a result,

27
Figure 3.2: Research model

28
CHAPTER IV: CURRENT SITUATION AT HVG & SCM
Commented [H10]: Sửa lại title cho nó cô đọng
ANALYSIS
4.1 HGV CURRENT SITUATION

4.1.1 Company overview

 Introduction
Hai Vuong Group is currently the largest Tuna processor and exporter in Vietnam.
“ ”

- Main activities include processing, trading, marketing, and exporting products.

- Productivity: export nearly 32,000MT of Tuna over 40,000MT of finished seafood products.
- Capacity: Can process about 75,000MT of Tuna products per year.
- Main market: Europe, Americas, Asia and Middle East.
- Annual sales amounts $100 million for Tuna products.
- Source of raw material: 90% of raw material is imported from Taiwan, Korea, Japan, Fiji
and Spain.

29
 Organizational Structure of HVG

Source: Admin Department - HVG

Figure 4.1: HVG’s Organizational structure

 HVG Resources
o Infrastructure
“ In recent time, HVG with an area of 91,200 square meters is comprised of four separate
structures including (table 4.1)

Table 4.1: Facilities at HVG

Facilities/ infrastructures Quantity
Offices 4
Processing plants 4
Accommodations for employees 4
Band saw machines 110
Super-cooling storehouses at -60ºC 2
Deep-freezing tunnels at -35ºC 3
Air-blast freezing system of -70ºC 5
Cooling storehouses at -35ºC 3
steaming room 2
CO room 4
Chiller room for treating CO 3
Source: Admin Department - HVG

o Human resources
30
 HVG has a total staff of more than 2,000 loyal and dedicated people (Table 4.2).

Table 4.2: Quantity and qualification of employees in HVG

o Managing purchasing inputs

This is one of key factor in the supply chain management. All enterprises have this activity no
matter large or small businesses. The cost of purchasing inputs often accounts for a high
proportion of the total cost of running business, especially in manufacturing and distributing.
Thus, managing the inputs has a close relationship with the efficiency of an enterprise.

HVG currently has not made self-supply inputs yet, so 100% of material is purchasing from
outside. Therefore, managing the cost of inputs is definitely over controlled.

Source: Production planning department - HVG

Figure 4.2: Diagram of the purchase process at HVG

The diagram shows five steps of the purchasing inputs process at HVG. This process can be
divided in 2 areas: purchasing material for main production (fishes) and purchasing other
material supporting production (chemical used in seafood processing, equipment replacement
and utility).

However, due to catches in Vietnam does not supply enough raw materials for manufacturing at
the company. Thus, expanding the purchasing area is the second choice of the company. There
are 90% of the raw materials imported from various sources globally.

31
Table 4.3: Quantity of frozen fish imported from 2013 – 2016
Year 2013 2014 2015 2016
Quantity (Tons) 22,067 24,253 22,862 29,869
Source: Purchasing Department - HVG

Tuna supply chain of the company will be derived from the stage of exploitation, through the
process of purchasing, processing, consumption, export to end customer. Tuna input materials
can be classified into two categories (Figure 4.3): domestic raw materials (10%) and oversea
raw materials (90%). Domestic raw materials are mainly purchased through intermediaries
(≈65%) or directly from tuna fishing vessel owners (≈35%).

Source: Sales department - HVG

Figure 4.3: Seafood supply chain

Production activities at HVG are relatively diversified. Each product has its own production
process depending on the market and customers’ requirements. However, it is possible to
generalize the production process which HGV is producing as below (Figure 4.4):

32
 Source: Production planning department - HVG

Figure 4.4: The standard production process of HGV

This is the standard production process, thus it requires all related departments must coordinate
smoothly to minimize the errors as well as production cost.

On the other hand, the production monitoring at HGV is divided into several stages and
monitored closely, but generally there is no linkage between the stages. Sometimes, KCS and
HACCP staffs are overlap in quality control stage (Figure 4.5).

33
 Source: Production planning department

Figure 4.5: Orders management process at HVG

o Delivery
The company's distribution network is set up under the Business to Business (B2B) method.
That means the finished products are exported directly to foreign customers. The Export-Import
Department will be responsible for this process and receive the support from the accounting and
sales department.

For transportation process, HGV will hire empty containers from shipping companies and rents
container terminal to pull the empty container to the factory. Besides, large carriers are mostly
foreign shipping lines, which occupy a large market share in Vietnam, so they have the capacity
to control freight rates and associated services. As a result, HGV and other exporters are forces
to pay high freight.

In addition, there are now more than 50% of the volumes of imported goods that the HGV
cannot intervene in selecting carriers because the company lacked the initiative in scheduling
delivery. Other reasons are the carriers selected by the company have no market share in the
exporting countries and are in part due to customers' requests.

 HVG Operation Result

34
 Table 4.4: Export turnover from 2013 to 2016
Year 2013 2014 2015 2016
Quantity (Thousand Tons) 12.84 16.16 16.08 16.22
Revenue
72.66 81.88 92.64 94.86
(Million Dollar)
Source: Sales Department - HVG

Regarding to the table above, the export growth rate is always from 10% to 35% in the period
2013 - 2016. It demonstrates the company’s export development is extremely well (table 4.4).
Moreover, the result of company’s operation increased sharply within the first 5 months of 2017
(table 4.5). The total export volume was 7.33 thousand tons of finished products, equivalent to
1.47 thousand tons per month with the turnover of 42.85 million USD, equivalent to 8.57
million USD in first five months. It shows the increased dramatically in comparison with the
output and average revenue of the previous year was 45.19% in volume and 45% in value.

Table 4.5: Export turnover from within the first five months of 2017
Year January February March April May
Quantity
1.64 1.05 1.30 1.75 1.59
(Thousand Tons)
Revenue
9.60 6.12 7.62 10.23 9.28
(Million Dollar)
Source: Sales Department – HVG

The measurement of SCM at HVG in 2015 and 2016 can be based on the five basic indicators
presented in SCOR model includes: Delivery ability, Responsiveness, Flexibility, Costs and
Assets.

o Customer service

HVG’s supply chain is set up under Build To Order (BTO) strategy. The company's tuna
products are processed based on specific inquiries to meet the unique needs of each customer.
The activities of members in the chain are made after receiving the order.

- Order fulfillment lead time

35
The average order fulfillment lead time is 20 days, but some orders with difficult specifications
require about 30 days or easy one take 15 days of completion. Overall, within 20 days, HVG
can complete all production process and documents and be ready for deliver.

- Order fulfillment

The total amount of orders HVG received last three years has not been much different.

Table 4.6: Perfect order fulfillment at HVG

Year 2014 2015 2016

Order fulfillment 637 98.60% 628 97.66% 642 99.07%

Total Orders 646 100% 643 100% 648 100%
Source: Sales department – HVG

Almost orders were completed on time with high rate over 97%. In 2016, the rate of completed
order was highest with 99%. Within 648 orders received, HVG completed 642 orders on time.
This is a good sign that the Company’s operations are effective (table 4.6).

- Amount and value of delayed cargos

Each year, HVG have over 600 orders from different markets, each order has around 20 days
for processing and document preparation. Thus, the company has to perform many orders at the
same time and it is hard to avoid errors in production as well as documents. This leads to late in
delivery. These orders were often delayed from 5 to 7 days due to problems in production
process or materials deliver. In table 4.7, there was 2.32% of delayed delivery in 2014. This
proportion was fell nearly a half in 2015 at 1.40%, but then increased to 1.85% in 2016.

Table 4.7: Cost of delayed cargos

Year 2014 2015 2016

Total orders 646 643 648

Delayed orders (containers) 15 9 12
Delayed rate 2.32 1.40 1.85
Total cost (USD) 15,386.77 9,232.06 14,309.42
Source: Accounting Department – HVG

- Warranty/ returns processing costs

36
 Each year, HVG has few cases of goods recalled/ returned, which caused many difficulties and
losses for the Company. In 2014, within total 646 shipments, there were 14 containers returned,
account for 2.17%. In 2015, the number of containers returned dropped to 10 containers
returned with lowest rate of 1.56% and was reduced significantly to 5 containers in 2016,
account for 0.77% over total order. This is a positive signal for the company operation (table
4.8).

Table 4.8: Cost of returned cargos

Year 2014 2015 2016
Total order 646 643 648
Recalled containers 14 10 5
Recall rate (%) 2.17 1.56 0.77
Total cost (USD) 1,359,000 1,014,000 646,000
Source: Accounting Department - HVG

o The effectiveness of internal management

- Inventory value

Inventories include raw materials, semi-finished goods and finished goods. From 2014 to 2016
inventory value increases each year, especially, in 2016 reached highest value with
$11,587,072. Theoretically, the more inventory value shows the less efficiency HVG gains in
sales activity. However, in reality, we have to consider inventory turnover for the conclusion.

- Inventory turnover
𝐶𝑂𝐺𝑆 17,353,190
Inventory turnover 2015 = 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑖𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 = (8,081,699+7,481,700)/2 = 2.23 times

𝐶𝑂𝐺𝑆 15,541,050
Inventory turnover 2016 = = = 1.63 times
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑖𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 (7,481,700+11,587,072)/2

While the inventory turnover ratio as high as possible, then the last two years have a very low
rate. This proofs that the company is not working well in inventory management. In 2016 the
number of inventory turns less than in 2015 proves that the company consumed the product was
not as good as last year.
- Return on sales (ROS)

37
Table 4.9: Breakdown the efficiency of Business activities
(Unit: million USD)
Year 2013 2014 2015 2016
Total assets 14.87 20.25 23.72 27.26
Short-term assets 12.92 18.33 21.03 22.47
Cash & Cash
0.21 0.21 0.31 0.31
Equivalents
Inventory 3.99 9.59 9.36 14.60
Total liabilities 9.73 15.63 17.46 20.89
Short-term liabilities 9.72 15.63 17.46 20.15
Solvency ratio 1.53 1.30 1.36 1.30
Quick ratio 0.91 0.51 0.67 0.38
Current ratio 1.33 1.17 1.20 1.08
Liquidity 0.210 0.002 0.250 0.003
Source: Accounting department – HVG

- Solvency ratio

According to table 4.2.6, the solvency ratio of HVG in 2014 was 1.30 times, this meant $1 of
liability payable secured by $1.30 of asset. In 2015, this ratio was 1.36 times, increased 0.06
times compared with 2014. However, this ratio was slightly dropped at 1.30 times in 2016.
Overall, all solvency ratio during 3 years were higher than 1, so HVG always ensure the
payment of debts.

- Quick ratio

This ratio is based on current asset and removed inventory as well as prepaid expenses. This
ratio considered acceptable when it is equal or higher than 1. Over the past years, HVG’s quick
ratio is quite high in 2014 and 2015. In 2016, this ratio was reduced to 0.38 but not very too
low. This represents the company's financial is still in good situation.

Current ratio: This coefficient shows how many short-term assets can be used to pay for one
short-term corporate debt. This coefficient of firm value is high through Table 4.2.6. This again
shows that the financial situation of the Company recent years is very healthy.

- Cash conversion cycle (CCC)

38
 CCC indicates the cycle from when HVG pays raw materials to the supplier until the company
receives money from the customer. This cycle in the company usually takes about 7 days,
relatively short. It demonstrates that the company is capable of quick money spin.
CCC = Days inventory outstanding + Days sales outstanding – Days payable outstanding = 5 +
7–5=7
o Flexibility
- Productivity

It is started at the time HVG sign contract with customer. Raw material purchasing process
takes about 5 - 7 days.

Productivity: depending on specifications will take 1 – 2 days for a container 25 Tons

- Inventory flexibility

Regarding to annual reports, HVG will predict monthly raw materials price, catching season
and quality of Tuna. Then, HVG prepare storage plan of raw materials and semi-finished goods
to cater for increased orders or low catching seasons. Normally, quantity of materials in stock
will be equal to 1.5 times of quantity of orders. As a result, the company can respond to
increased orders quickly.

39
 4.1.2 Evaluate SCM at HVG based on SCOR

Overall, HVG performance in 2016 gained significant achievements, but there still occurred issues
which impact the company operation. Therefore, deep-interview has been conducted to find out main
current problems at HVG (table 4.10):

Table 4.10: HVG’s achievements and current issues Commented [H11]: Bảng này review lại các issues
FACTORS ACHIEVEMENTS CURRENT ISSUES
Understood the market, determined Have unclear responsibilities and
customer demand. Based on data power division between departments,
from previous years, observed leads to push responsible to others
Forecast fluctuations as well as reference when problems occur.
Demand data forecast by reputable
organizations to meet the quality
demand.
HVG mainly produces to orders
and make production/ material
procurement plan based on data
collected from inquiries.
Have weekly meeting between
middle managers for next week
Product production planning and reviewing.
pricing
Reserve raw material strategy:
PLAN

fishery product is seasonal product,

thus HVG has plan to lay in store
the materials for months with low
catching status.

Plan all activities from raw Even without orders, the company is
material purchasing, manufacturing forced to purchase and store raw
to delivery. materials to maintain relationships
with suppliers and stabilize the output
Have good raw material storage prices for the market.
planning: HVG plan to stock the
Inventory materials for months with low
management catching status.
Update price list weekly.
Apply FIFO strategy to manage the
inventory.

40
 Have a dedicated purchasing team Have no specific evaluation standard
(purchasing department and for raw material, so the purchasing
material purchasing station). staffs evaluate quality primarily based
on feeling (touching, smelling and
Purchase raw material through taste).
Procurement various channels: from local and
oversea, direct and indirect. Raw material is shortage
SOURCE

Conduct procurement activities

systematically and control based on
a proposed procurement process.
Build good image with commercial Risky payment method: Almost use
banks, so ease to access loans. Telegraphic Transfer (TT).
Credit and Create good relationship with
receivable suppliers by quick cash payment
and sharing essential information
regularly.
Have effective production process Undiversified products: not produce
for each type of fresh and frozen: high added value products (ready to
minimize costs and lead time. eat products).
Production Have wide and separate production Inefficient communication: mostly
design areas for each sub-process. communicate by email, so late update
changes in production plan will affect
Be flexible in specifications (size, finished goods and generate more
weight and thinness, etc.). costs because of internet problems.
MAKE

Have good quality management:

New product have own Lab room to inspect
testing samples before deliver.
Quick product traceability: all High cost of recall and reproduce due
semi-finished goods and finish to wrong packaging and labeling.
goods have labels presented
High inventory cost: HVG is trying to
product name, production date,
Packaging and
SKU clearly outside cartons. purchase and store raw materials to
storage
maintain relationships with suppliers
Keep product in good storage and stabilize the output prices for the
condition. market.

41
 Quick orders update: all related Technology: management systems are
departments capture orders' almost designed and control by
requirements by email, then update HVG’s IT staff.
Orders on local network.
management Number of cancelation is high.
Track the process of orders
regularly by email.
DISTRIBUTION

Utilize empty container from Inflexible in arranging distribution

Distribution import for export activity. schedule: follow customers’
plan requirements or shipping line
schedule.
Company has their own trucks, so Long travelling distance: the distance
they are more active in delivery. between factory, warehouse, port and
X-Ray company is far.
Have wide relationship with
Transportation logistics companies and get high Delay from shipping line frequently
discount rate from them. => customers’ claim and increase
costs at port.

Have a specific plan for handling Pay high cost for inspect and recall
claims about unqualified cargos defective goods.
(low quality, quantity shortage).
Customer service is not good: slow
Have clear terms about recall response to inquiries and claims.
RETURN

Resource and conditions and compensations.

Finished goods
Have skillful and experienced
inspectors.
The amount of defective goods
claimed is low.
Source: by interview

After interviewing top managers at HGV, the researcher found out problems and grouped similar issues
together and analyzed in the Pareto analysis (Table 4.11)

Table 4.11: Summarize interview results about HVG’s current issues Commented [H12]: Dẫn tới bảng này cũng sửa các issues
HVG's Current Issues 5 Interviewers và thiết kế lại thông tin cho hợp lý. Anh chị xem clip em gửi
Factors
trên viber nha.
Purchase and store raw materials 1
Plan
Responsibilities and power division. 1
Raw material standards 2
Source
Payment method is risky 2

42
 Raw material shortage 4
Undiversified product 2
Inefficient communication 1
Make
Product quality 4
High inventory cost 1
Technology 3
Distribution arrangement 2
Distribution
Delivery delayed 4
Long traveling distance 2
Order cancelation 5
Return Recall rate 4
Customer service 2
Source: by author

4.2 ANALYZE CAUSES AFFECTING SC AT HVG

Based on internal report at HVG at the end of 2016 and the interview, the researcher found out causes
was affecting the SCM at HVG. Pareto chart would be analyzed to find out what causes contribute
mostly to the cost of HVG’s supply chain. Pareto chart would only mention causes which generate cost
to the chain (Appendix 4).

4.2.1 Pareto analysis

 Analyze by Causes

Table 4.12: Pareto analysis by causes Commented [H13]: Nên viết 1 đoạn về table này
Error Cumulative %
Errors/ Issues
Amount amount Cumulative
Product quality 47 47 40.17%
Raw material shortage 32 79 67.52%
Distribution arrangement 14 93 79.49%
Others 11 104 88.89%
Technology 6 110 94.02%
Customer service 5 115 98.29%
Payment method 2 117 100.00%
Source: Accounting Department – HVG

43
 Pareto Analysis Regarding to Causes
98.29%
50 94.02% 100.00%
88.89%
45 79.49% 90.00%
40 80.00%
67.52%
35 70.00%
30 60.00%
25 40.17% 50.00%
20 40.00%
15 30.00%
10 20.00%
5 47 32 14 11 6 5 2 10.00%
0 0.00%
Product Raw material Distribution Others Technology Customer Payment
quality shortage arrangement service method

Error Amount % Cumulative

Figure 4.6: Pareto analysis chart regard to causes

Regarding to the frequency errors occur, two causes repeated regularly in 2016 are Raw material
shortage and Product quality (Figure 5.6). Product quality accounted for more than 80% of the supply
chain error amount. However, to figure out whether these two causes contribute most on the cost of
supply chain, another analysis based on cost will be apply in the analysis below.

 Analyze by costs

Now costs of those causes will be analyzed to double check whether they are main causes.
Total costs and error rate are sorted in decrement order (Table 4.13).
Table 4.13: Pareto analysis by cost
Total Cost Cumulative %
Errors/ Issues
Generate ($) cost Cumulative
Product quality 4,275,000 4,275,000 68.40%
Raw material shortage 1,646,000 5,921,000 94.74%
Technology 183,100 6,104,100 97.67%
Others 53,750 6,157,850 98.53%
Payment method 40,000 6,197,850 99.17%
Distribution arrangement 26,400 6,224,250 99.59%
Customer service 25,500 6,249,750 100.00%
44
 Source: Accounting Department – HVG

Pareto Analysis Regarding To Costs

4,500,000 100.00%
97.67% 98.53% 99.17% 99.59% 100.00% 90.00%
4,000,000 94.74%
3,500,000 80.00%
70.00%
3,000,000
68.40% 60.00%
2,500,000
50.00%
2,000,000
40.00%
1,500,000
30.00%
1,000,000 20.00%
500,000 10.00%
4,275,000 1,646,000 183,100 53,750 40,000 26,400 25,500
0 0.00%
Product Raw Technology Others Payment Distribution Customer
quality material method arrangement service
shortage

Total Cost Generate ($) % Cumulative

Source: Accounting Department – HVG

Figure 4.7: Pareto analysis regarding to costs.

Figure 4.7 clearly shows Product quality has largest impact on the SC, which contributed more than
95% of total cost of the SC. Meanwhile, other causes contributed only 5% of HVG expenses.
Therefore, Product quality will be analyzed in following part to find out its root causes.

4.2.2 Tracing causal model

45
 Source: by author

Figure 4.8: Tracing causal model

46
4.2.3 Fishbone analysis

To figure out root cause, Fishbone diagram below will analyze clearly possible factors related to
product quality management at HVG: Man, Material, Method and Environment (Figure 4.9).

Figure 4.9: Product quality Fishbone analysis

47
Table 4.13: Identify root causes using 5WHYs analysis Commented [H14]: Dẫn tới cái này cũng phải thay đổi
theo issues bên trên.
Ghi chú: nên brainstorm những issues nào có thể measure
dc và cho vào mục này thì hay hơn.

Source: By author

Two red circles in table 4.13 are major root causes which contribute to generating highest cost for
HVG. Both of them are mostly important to the quality management because if they cannot be solved
first, the errors will occur more day by day. Lighting is important for quality classification and
inspection, because if the lights do not reflect real color of the product, mistakes will happen. Similarly,
monitoring and raising workers awareness on food safety is essentially need to avoid claims for product
infected salmonella.

48
 CHAPTER V: HVG GOALS AND RECOMMENDATIONS

5.2 THE DEVELOPMENT PERSPECTIVE OF THE COMPANY

In order to improve SCM, the company needs to establish a development orientation based on the
following views:

- Besides current product, the priority should be given to develop new product.
- The company should improve training policies, recruit workers and staffs with more skillful and
higher education to meet the development requirements of the company as well as the change of
economic.
- Continue to expand the export market to other countries especially Italia, France and Spain through
marketing channels such as participating International Seafood Expo. Moreover, build and promote
brand name on social media like seafood websites, facebook, Twitter, Linkedin, etc.
- Offer more incentives for traditional customers.
- Organize and implement the annual development orientations of the Company, develop production
business step by step bring the company's activities into more depth and closed.
- Focus on improving product quality to increase the competitiveness. Strict control food safety
standard to ensure the quality of products hygiene.
- Maintaining the production of tuna; Expand the category of products on the number of new items
with high added value such as steamed tuna, tuna smoked.
- Continue to upgrade the production condition, apply effective management system to ensure food
safety accordance with the standards of HACCP, ISO, USDC… to maintain EU Code and Russia
Code.
- Expand the sources of raw material, build more plants and accelerate comprehensive export.

5.2 RECOMMENDATIONS
Based on recommendations from interviewee, some improvements are suggested for SCM at HVG in
short term as well as long term.

49
 5.2.1 Facility improvement

Need to plan for changing all the light once a year to improve the working environment, better quality
inspect as well as classification.

Mechanical and electrical department will be responsible for reporting broken lamps.

5.2.2 Diversity relationship with suppliers

Focus on establishing alliances with suppliers, not only the captains, but also material suppliers:
With the characteristics of production and activities, the company has to buy 100% inputs for
manufacturing, so it is absolutely necessary for diversify relationship with suppliers.

In order to concretize this strategy, HVG has to diversify and implement its relationships with the
suppliers as follow:

- The company is suggested to keep relationship with irregular suppliers. Nevertheless, the
interaction between the Company and these suppliers is low, so this relationship will be maintained
at a minimum level to meet supply needs when there is no possible choice.
- Furthermore, keep good partnership with suppliers of raw materials, cleaning chemicals, production
materials will help the Company be more active in their production plan. The Company can build
relationship with suppliers through mutually beneficial business cooperation. For example,
Company can contribute capital and purchase shares of their strategic suppliers, since then, the
Company will has a stable supply, preferential prices and more competitive than other competitors.
- The other advice is that the company should enter into alliance with Seafood processing and
exporting associations (VASEP) to solve limits in production capacity, technology level,
unfavorable in geographical location. As a result, it creates more chance for the Company to expand
their business in production as well as export market.

5.2.3 Standardize purchasing department

Purchasing goods and supplying inputs for manufacturing play an essential role in production plan,
production cost as well as production efficiency. Experience from many other enterprises inside and
outside the industry, it shows that business have purchasing department which is organized

50
professionally with experienced purchasing staff, comprehend the market, thinking ability,
communicate and negotiate well.

Therefore, workshops can be open regularly to train skills below:

- Train purchasing staff in soft skills: negotiation, communication as well as knowledge about risks
when purchase from different markets.
- Reduce number of KCS travelling oversea and increase using third party to inspect defective cargos
claimed.

5.2.4 Apply technology system in SCM activities

Apply IT systems to connect science and SCM: Search, exploring, inputs storage, production plan
management, warehouse and distribution.

Systems support for SCM: EPR (Enterprise Resource Planning), FRM (Finance Resource
Management), CRM (Customer Relationship Management)

5.2.5 Train the admin team on supply chain management

Establish a separate training center.

Encourage employee participate SCM Training programs: C.S.C.P (Certified in Supply Chain
Professional) and S.P.I.M (Certified in Production and Inventory Management).

All information related to SC and SCM such as business strategy and Production schedule have to be
public to all related departments.

5.2.6 Develop an improvement plan and re-organize the chain

Set up a plan for evaluating SCM in short terms and long terms.

- Update daily errors and solutions in intranet of HVG for references.

- Double check with KCS and Internal inspection.
- Add more HACCP staff at quality classifying stage to reduce the mistakes.

51
5.3 SUMMARY RECOMMENDATIONS

Table 4.14: Summary recommendation for improving HVG’s SCM Commented [H15]: Insert thêm 1 cột measurements
Root causes Recommendations Action plan Parties (KPI) để đo lường các suggested solution
involved Commented [H16]: Đổi tên thành “suggested solution”
Policy for Improve working Short term: Mechanical & Commented [H17]: Ghi chú: action plan không nhất thiết
inspecting environment: lighting Evaluate update all the lighting status electrical phải có cả long terms và short terms plan
lighting status status in inspecting and replace unsatisfied lamps within 2 team, Internal
in factory rooms and quality weeks. inspection
periodically. classification areas. department.
Long term:
Need to plan for changing all the lamps
once a year.

Food safety Raise workers Short term: KCS,

awareness and awareness on food Report daily and monthly errors in SC HACCP,
supervising safety. process. Sanitation
production team, workers
process. Remind workers 10 minutes every day
before working hour.

Long term:
Open training workshop twice a month.
Update new technology and use more
machines.

Train the admin team on SCM: C.S.C.P

and S.P.I.M program

Relationship Standardize purchasing Short term: Purchasing

between department. Regularly send greeting emails and department &
purchasing phone calls to suppliers. Sales
staff and Apply technology department
suppliers. systems in SCM Purchasing department works closely
with sales department to clearly
understand customer needs.

Long term:
Offer training program to improve soft
skills.

Enter into alliance with Seafood

processing and exporting associations
(VASEP)

52
Specific Develop a database for Short term: Sales
product product evaluation Sales department keep track all the department,
evaluation standards. report related to quality internal inspect Internal
standard. and update to customers on time. inspector

Update regularly specifications

requested including sample photos.

Long term:
Develop a list of all customer names
and categorized based on the market.

Offer incentive to sales people for

working at least 1 – 2 hours/night due
to different time zone with customers.

Feel time Develop an Short term: KCS,

pressure improvement plan and Double check with KCS and Internal HACCP,
because of reorganize the chain. inspection. internal
strict KPI. inspection
Update daily errors and solutions in department
intranet of HVG for references.

Long term:
Add more HACCP staff at quality
classifying stage to reduce the mistakes.

Source: By author

53
 CHAPTER VI: CONCLUSION Commented [H18]: Nên chia làm 3 phần:
(1)Summary key findings (obj 1  key finding…, Obj2 
Key finding….)
(2)Limitation
In conclusion, establishing and applying an effective supply chain model brings many benefits to the (3)Further directions: nếu người khác research tiếp về
business, especially in the context of current economic integration. To adapt with changes, it requires topic này thì họ sẽ làm tiếp những gì?

HVG always improve cost management, competing capacity, utilize current sources and satisfy
customer benefits.

“ Management of supply chain therefore requires the planning and control of activities to achieve a
deserved goal and shaping the organization by coordinate activities, goals, interests and relationships to
be able to resolve conflicts and make good decisions. ”

In the structure of seafood, Tuna always holds the importance position due to delicious Tuna meat,
popular and high level of nutrients. In addition, it contributes greatly to the export turnover of Vietnam.
However, facing with increasing strictly in customer requirements, food hygiene and safety, traceability
etc., supply chain management is required to be more effective in performance. Those members and
compositions in the chain must have close connection, harmonized interests for stakeholders and
increased value from exploitation to procurement, processing and consumption. This is considered as
the development trend inevitably in front of current fierce competition.

With the goal to enhancing the SCM at HVG to compete professionally with domestic and foreign
competitors, supply chain is a preferred approach. Seafood producers and exporters need to be aware of
the importance of supply chain management for their business. Approach and manage closely, find new
direction for their product supply chain.

Starting from that important meaning, the research topic has gone into the study of Yellowfin Tuna
supply chain at HVG to solve some basic issues as follow:

- Based on the theory of SC to apply and identify the supply chain model of Tuna at HVG.
- Analyzed and measured the performance, shown the results as well as the remaining aspects of
Tuna supply chain as a basic for improvement proposal of the current supply chain.
- Regarded to the current state of research and current supply chain management perspectives, the
author has studied and developed the following proposed company models: Supply Chain
54
 Management model and Supply Chain Strategic planning, investment cooperation model to
strengthen linkage in the supply chain.
- Analyzed the operation of the supply chain, the author identified a number of risks that the
company frequently encountered. The author suggests solutions that help the company effectively
manage supply chain risks by identifying, controlling, preventing and finding solution to reduce
risks.

However, due to limitation of research time and access to company database, the topic just finished at
the idea and development orientation and cannot go further in the implementation of radical solutions.
With the initial research results, the author hopes to help the company manage the supply chain more
effectively, improve the quality of products, enhance the company's competitive advantage over
competitors in and outside of the country. Although the subject is still limited but desirable as the basis
for more extensive supply chain studies, it can help businesses to develop their own supply chain
models for seafood in general and Tuna in particular.

55
REFERENCE

Arthur V. H. 2012, The Encyclopedia of operations management. Upper Saddle River, NJ: Pearson

Education, Inc

Chopra, S., and Peter, M. 2001, Supply Chain Management: Strategy, Planning, and Operations,

Upper Saddle River, NJ: Prentice-Hall, Inc. Chapter 1.

Domenica, N. (2002). Supply chain planning and management. Retrieved May 22, 2017,

http://www.optirisk-systems.com

Ganeshan, R. and Terry P. H., (1995), An Introduction to Supply Chain Management Interfaces, vol.1,

pp. 2-3

Ganga, G. M. D.; Carpinetti, L. C. R. 2011. A fuzzy logic approach to supply chain performance

management, International Journal of Production Economics 134: 177–187.

http://dx.doi.org/10.1016/j.ijpe.2011.06.011

Handfield, R. B. (2002). Supply chain redesign: converting your supply chain into an integrated value

stream, New York: Financial Prentice Hall.

Kevin, 2014. Phan tich va so sanh cac mo hinh MRP, JIT va mo hinh quan ly dong bo, Retrieved June

02, 2017, https://vneconomics.com/phan-tich-va-sanh-cac-mo-hinh-mrp-jit-va-mo-hinh-quan-ly-dong-

bo/

Lambert, D.M., Stock, J.R. and Ellarm, L.M. 1998. Fundamentals of Logistics Management.

Homewood, IL, New York.: Irwin, McGraw-Hill.

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Mentzer, J. T. and Min, S. 2000. The role of marketing in supply chain management, International

journal of physical distribution and logistics management, Tennessee: MCB UP Ltd

Ram, G., and Terry P. H. 1995. An Introduction to Supply Chain Management, Retrieved May 16,

2016, http://silmaril.smeal.psu.edu/misc/supply_chain_intro.html

SCC, Supply Chain Council. 2006. Supply Chain Operations Reference Model.

Scott C. and Westbrook R. 1991. New Strategic Tools for Supply Chain Management, International

Journal of Physical Distribution & Logistics Management, 21 (1), pp.520-530.

Shepherd, C. and Günter, H. 2012. Measuring supply chain performance: current research and future

directions, in J. C. Fransoo (Eds.). Behavioral Operations in planning and scheduling, Berlin

Heidelberg: Springer-Verlag.

Taylor, D. 2003. Supply chain a manager’s guide, Addition Wesley Publisher. Retrieved May 22,

2017, http://www.openisbn.com/preview/020184463X/

“ Trang thong tin dien tu da utu nuoc ngoai, 2017, Tình hình kinh tế thế giới năm 2016 và dự báo năm

2017, Retrieved May 28 2017, http://fia.mpi.gov.vn/tinbai/5188/Tinh-hinh-kinh-te-the-gioi-nam-2016-

va-du-bao-nam-2017

Vietnamnews, 2013, Efficient supply chain mechanism key to boosting competitiveness. Retrieved

February 16, 2017, http://vietnamnews.vn/economy/245976/efficient-supply-chain-mechanism-key-to-

boosting-competitiveness.html

Viswanadham, N. 2000, Analysis of Manufacturing Enterprises: An Approach to Leveraging Value

Delivery Processes for competitive advantage. Boston, Mass.; London: Kluwer Academic

57
APPENDIX
1. List of vendors have been approved

58
2. Interviewee list
No. Interviewees/ Top managers Time (minutes) Position
1 Nguyen Xuan Nam 40' (17/5/2017) Director
2 Huynh Van Lin 40' (20/5/2017) Im-Export manager
3 Luong Thi Minh Thuy 45' (20/5/2017) Sales manager
4 Tran Thi Nhat Minh 55' (22/5/2017) Quality manager
5 Nguyen Thi Thi 50’ (27/5/2017 Financial manager
6 Nguyen Trung Tuyen 40’ (27/5/2017) Technical manager
7 Thieu Thi Cam Tu 50' (28/5/2017) Production manager

3. Interview questions
OBJECTIVE INTERVIEW QUESTIONS
1. Could you please introduce a bit about your role in SCM at
HVG?
Evaluating the current 2. Does your company apply any SCM model/ system to support
supply chain for the SCM? (If yes) What are they?
management system in 3. How do you evaluate the supply chain performance at HVG in
HVG. your perspective?
4. Does your company have any KPI for evaluating the whole
chain from input to output? (If yes )What are their functions?
5. What factors do you think they are contributed to the SCM at
Identifying issues and HVG?
potential risks in current 6. Which one is the most challenge for management?
SCM system. 7. What factors do you think contribute to generating unexpected
costs in the SCM at HVG? And which one affects most?

Proposing a SCM 8. From your point of view, what should HVG do to overcome
improvement solutions those challenges/ issues?
and action plans for
enterprise in short term
and long term.

59
 4. Payment methods

Source: Incoterms 2010

EXW: Since the seller places the goods at the disposal of the buyer, the buyer must carry out all tasks
“

of export & import clearance. Carriage and insurance is to be arranged by the buyer.
FCA: the seller delivers the goods, cleared for export, to the carrier nominated by the buyer at the
named place. Seller pays for carriage to the named place.
FAS: The seller is required to clear the goods for export. The buyer has to bear all costs and risks of
loss or damage to the goods from that moment.
FOB: The buyer has to bear all costs and risks to the goods from that point. The seller must clear the
goods for export.
CFR: the seller delivers when the goods pass the ship’s rail in port of shipment and pay the costs and
freight necessary to bring the goods to the named port of destination as well as clear goods for export.
CIF: Seller must pay the cost and freight necessary to bring goods to named port of destination,
procure marine insurance against buyer’s risk of loss/damage during the carriage and clear the goods
for export.
CPT: The seller delivers the goods to the carrier nominated by him and pays the cost of carriage to
bring the goods to the named destination. The buyer bears all costs occurring after the goods have been
so delivered and they must clear the goods for export.
CIP: This term is the same as CPT with the exception that the seller also has to procure any mode of
transportation
DAT: The seller bears all risks involved in bringing the goods to and unloading them at terminal at the
named port or place of destination
DAP: The seller bears all risks involved in bring the goods to the named place
DDP: The seller also will bear all costs and risks of carrying out customs formalities including the
payment of duties, taxes and customs fees.”

60
5. Stock list in 2016:

FINISHED GOODS
No. Customer Specification Description Size Quantity (kgs)
1 BLD Tuna Loin S/O 2-4 2,841.90
2 BLD Tuna Loin S/O 2UP 28,453.30
3 BLD Tuna Loin S/O 2UP 1,465.10
4 BLD Tuna Loin S/O 1-2 774.15
5 BLD Tuna Loin S/O Tail With Skin 1-2 50,304.40
6 BLD Tuna Loin S/O Tail With Skin 1-2 167,951.50
7 BLD Tuna Loin S/O Tail With Skin 1-2 2,217.20
8 BVS Tuna Steak S/L 6OZ 3,072.80
9 BVS Tuna Steak S/L 5-6OZ 236.00
10 BVS Tuna Steak S/L 7OZ 23,958.50
11 BVS Tuna Steak S/L 7OZ 32,842.00
12 BVS Tuna Saku S/L 3.80
13 BVS Tuna Steak S/L 4-6OZ 40,395.87
14 BVS Tuna Steak S/L 4-6OZ 4,500.93
15 BVS Tuna Loin S/L 3-5LBS 2,027.59
16 BVS Tuna Loin S/L 5-7LBS 2,236.25
17 BVS Tuna Loin S/L 6OZ 362.88
18 BVS Tuna Loin S/L 8OZ 5,444.32
19 BVS Tuna Saku S/L 6OZ 33.30
20 BVS Tuna Saku S/L 8OZ 434.10
21 BVS Tuna Saku S/L 8OZ 36,093.00
22 BVS Tuna Saku S/L 6OZ 75,264.54
23 BVS Tuna Saku S/L 8OZ 7,274.22
24 CLR Tuna Loin S/L 2UP 29,709.40
25 CLR Tuna Loin S/L 2UP 221,813.95
26 NAT Tuna Loin S/L 2UP 24,915.30
27 NAT Tuna Loin S/L 2UP 25,286.40
28 NAT Tuna Loin S/L 2UP 37,898.56
29 ORB Tuna Loin S/L 1-2 46,524.50
30 ORB Tuna Loin S/L 2UP 206,543.43
31 ORB Tuna Loin S/L 2UP 91,344.70
32 ORB Tuna Loin S/L 2UP 157,838.00
33 ORB Tuna Loin S/L 634,553.90
34 ORB Tuna Saku S/L 2UP 35,234.00
35 TPC Tuna Saku S/L 6UP 8,963.70
36 VR Tuna Saku S/L 2UP 1,749.00
61
37 Total 2,010,562.49

SEMI-FINISHED GOODS & RAW MATERIAL

No. Product Description Size Quality Quantity (kgs)
1 Tuna Loin WR Cut Saku 30UP A USA 250,240.00
2 Tuna Loin WR Cut Saku 30UP A USA CTKQ 12,389.40
3 Tuna Loin WR Cut Saku 30UP AA USA CTKQ 1,108.50
4 Tuna Loin WR Cut Saku 30UP AA USA 179,685.10
5 Tuna Loin WR Cut Saku U25 AAA USA 4,063.80
6 Tuna Loin WR Cut Saku U25 AAA USA CTKQ 23,887.40
7 Tuna Loin WR Cut Saku U25 AA USA_ Tail With Skin 84,735.10
8 Tuna Loin WR Cut Saku 50UP A USA CTKQ-Tail With Skin 233.00
9 Tuna Loin WR Cut Saku 50UP AAA USA_ Tail With Skin 122,750.30
10 Tuna Loin WR Cut Saku 50UP AA USA_ Tail With Skin 247.40
11 Tuna Loin WR Cut Saku 50UP RUS 211,241.00
12 Tuna Loin S/L U1 A USA 10.10
13 Tuna Loin S/L 1-2 A USA 65,408.50
14 Tuna Loin S/L 1-2 A USA CTKQ 233,048.10
15 Tuna Loin S/L 1-2 AA USA CTKQ 54,131.60
16 Tuna Loin S/L Cut Steak 2-3 A USA 1,075.60
17 Tuna Loin S/L Cut Steak 2-3 A USA CTKQ 3,421.20
18 Tuna Loin S/L Cut Steak 2-3 AA USA 20.40
19 Tuna Loin S/L Cut Steak 2-3 A USA CTKQ 343.90
20 Tuna Loin S/L Cut Steak 2-3 A USA <2.5KGS 158.70
21 Tuna Loin S/L Cut Steak 2-3 A USA 246.30
22 Tuna Loin S/L Cut Steak 2-4 AA USA 238.60
23 Tuna Loin S/L Cut Steak 2-4 AA USA CTKQ 390.40
24 Tuna Loin S/L 2-4 A USA CTKQ-Tail With Skin 22.60
25 Tuna Loin S/L 5UP A USA-Tail With Skin 17.40
26 Tuna Loin S/L 5UP A USA ( CHUNK ) 120,457.00
27 Tuna Loin S/L 4UP A USA ( CHUNK ) 17,200.10
28 Tuna Loin S/L 2-4 A USA 32.10
29 Tuna Loin S/L 5UP A USA 281,479.00
30 Tuna Loin S/L 5UP A USA CTKQ 148,991.10
31 Tuna Loin S/L 5UP A USA CTKQ 9,898.60
32 Tuna Loin S/L U2 A USA CTKQ 34,225.70
33 Tuna Loin S/L 1-2 A USA 98,208.40
34 Tuna Loin S/L 1-2 AA USA 6,138.80
35 Tuna Loin S/L 1-2 AA USA CTKQ 2,101.00
36 Tuna Loin S/L 1-2 A USA 450,000.00
62
 37 Tuna Loin S/L 5UP A USA 19,000.60
38 Tuna Loin S/L Cut Saku 4UP AA USA 2,321.80
39 Tuna Loin S/L 2-4 A USA 4,389.20
40 Tuna Loin S/L 2-4 A USA (< 3.6KG) 765,457.20
41 Tuna Loin S/L 2-4 A USA CTKQ 7,984.10
42 Tuna Loin S/L 2-4 AA USA 5,192.70
43 Tuna Loin S/L 2-4 AA USA CTKQ 24,217.00
44 Tuna Loin S/L 2-4 A USA_ Tail With Skin 12.20
45 Tuna Loin S/L 4UP A USA 12,399.90
46 Tuna Loin S/L 4UP A USA CTKQ 11,183.40
47 Tuna Loin S/L 4UP AA USA CTKQ -
48 Tuna Loin S/L 4UP AA USA_ Tail With Skin 187,500.30
49 Tuna Loin S/L 4UP AA USA 12,294.20
50 Tuna Loin S/L 4-5 A USA (< 4.5KG) 12,902.00
51 Tuna Loin S/L 4-5 A USA (>4.5KG) 1,587,650.00
52 Tuna Loin S/L 4-5 A USA CTKQ 70,840.10
53 Tuna Loin S/L 4-5 A USA 8,791.00
54 Tuna Loin S/L 4-5 AA USA 365,109.70
55 Tuna Loin S/L 4-5 AA USA CTKQ 926,357.00
56 Tuna Loin S/L 3UP A USA CTKQ 98,573.00
57 Tuna Loin S/L 5UP A USA 7,863.20
58 Tuna Loin S/L 5UP A USA (<5.5KG) 403.80
59 Tuna Loin S/L 5UP A USA (> 5.5KG) 18,130.40
60 Tuna Loin S/L 5UP A USA (> 6KG) 9,734.40
61 Tuna Loin S/L 5UP A USA ( CHUNK ) 356.20
Total 6,576,509.60

6. SCM Current issues and cost generated at HVG

Interviewers Error Cost Generate

HVG's Current Issues
(5/5) Amount ($)
Product quality 4 47 3,275,000
Raw material shortage 4 32 1,646,000
Technology 3 6 183,100
Risky payment method 2 2 40,000
Distribution arrangement 2 11 26,400
Customer service 2 5 25,500
Unclear development strategy 1 53,750
Responsibilities and power division. 1

63
High inventory cost 1
Undiversified product 2
Raw material standards 2
Inefficient communication 1
Recall rate 5
Long traveling distance 2
Delivery delayed 4
Cancelation rate 5
Source: Accounting Department - HVG

64