GROUP 3 - ASSIGNMENT 3 - ENTRY MODE

*Group Members:
Full Name Student ID
Pham Gia Bao 31201025173
Nguyen Hien Dieu 31201021354
Truong Huynh Nhu 31201021288
Nguyen Ngoc Han 31201024495
Tran Hong Truc Ngan 31201023753
Huynh Khanh Vy 31201021988

I. Choosing An Entry mode (Indirect export)

Indirect exporting: Indirect export is the process of selling products to an
intermediary, who will then sell your products directly to the international market and
take on the responsibilities. These responsibilities include:
● Organizing paperwork and permits
● Organizing shipping and arranging marketing.
Direct exporting: involves an organization selling goods directly to a customer in an
international market.

Direct Exporting Indirect Exporting

Requires a middleman No Yes

Suitable for global Yes Yes

expansion

Who finds the buyers? The seller The middleman

Best use case ● Sellers with experience in ● Sellers that are new in the
international trade foreign market
 ● Sellers with access to ● Sellers that prefer to
resources to build a outsource international trade
specialized team

Associated costs Investment in a specialized team Commission to a third-party

+ Direct customer contact. + Very few extra staff are

+ A greater degree of control.
+ Higher profit margins.
+ Independence from foreign
partners.
Advantages
required.
+ Risks transferred to the third-
party.
+ Agent knows and has access
to the market and distribution
channels
+ Faster access to international
trade.
+ Less capital investment.
+ Smaller financial risks.

+ Greater financial risks. + Lower profit margins.

+ Higher capital investment. (Higher overhead costs)
+ Limited market coverage. + Lack of direct contact with

Disadvantages + Specialized knowledge and your customers overseas.

new staff hire required. + Less control over the entire
+ Insufficient knowledge of process and brand image.
market and culture.

=> Tri Tin Company chose indirect exporting because it's an almost risk-free way to
penetrate into the China market. Moreover, due to language and cultural barriers, Tri
Tin does have to worry about additional planning, marketing, or expenses when
choosing this type of export
II. Entry Mode Implementation
1. Legal

Procedures and registration for exporting food to China (Focusing on step 2,3,4,7,8)
a. Complete the importers and exporters registration
(Inspection Declaration: An export declaration is a form that is submitted
by an exporter at the port of export. It provides information about the goods
being shipped, including type, number, and value. This information is used by
customs to control exports, in addition to compiling statistical information
about a country's foreign trade)
- Foreign exporters usually adopt two ways to get goods to China: general trade
export or cross-border e-commerce (CBEC).
- If the foreign exporter wants to choose a Chinese importer of record to conduct
customs clearance (and quarantine if required), the exporter is advised to use
China’s credibility system to gather basic official information about the
prospect importer or review the importer’s performance via a public register
maintained by the GACC.
● Dossier of procedures for food export:
- Documents required by GACC include:
+ Certificate of business registration.
+ Corporate commitment.
+ Production diagram.
The above documents are required to be signed, stamped according to regulations and
accompanied by a copy.
- Documents required by the Plant Protection Department include:
+ One of the types of certificates such as: Certificate of qualified establishments
for food safety; a written commitment to produce and trade in safe agricultural,
forestry and aquatic products; certificate of good manufacturing practice;
certificate of system of hazard analysis and critical control point; certificate of
food safety management system; international food standard certificate;
certificate of global standards for food safety; food safety system certificate or
other equivalent certificate.
+ The written statement of eligibility to ensure food safety of the enterprise.
+ The plant quarantine certification of the plant quarantine agency of the
province or city according to the management competence specified in Circular
35/2015/TTBNNPTNT regulating domestic plant quarantine.
All of the above documents need to be signed and stamped according to regulations
and sent a copy to the Plant Protection Department via email
qlattpmt.bvtv@mard.gov.vn or submitted in person.
● Online registration process:
Instead of businesses having to go to the place to register for export to China for food
products of plant origin, now the new regulation allows online registration to help you
save a lot of time and effort.
+ Step 1: The enterprise requests the Plant Protection Department to grant
an account to the enterprise. It also provides complete information
including:
● Registration number
● Workplace
● Contact: Include contact person name, phone number, contact
address, email, type of goods intended to be exported to China.
+ Step 2: Enterprises access the Website https://cifer.singlewindow.cn and
use the account and password granted by the Plant Protection
Department to register online to export food to China. The operations
 will be guided specifically in the GACC's documentation included in the
Email.
Note: Only one product group can be registered per GACC classification. In case we
want to register 2 or more product groups, we must repeat the same steps as
registering at the first time.
+ Step 3: Enterprises must monitor the registration process and receive
feedback from the Plant Protection Department as well as GACC
directly on the Website.
Further, to be noted, as of October 2012, it is mandatory for exporters to register each
shipment of food products online with the General Administration of Quality
Supervision, Inspection and Quarantine (AQSIQ) department for tracking purposes

b. Tax Payment
- Tax: All commodities importing into china, need pay the 3 types tariffs:
1. Customs Duty (Thuế hải quan)
2. Value-added tax (VAT)
3. Consumption tax (Thuế tiêu thụ)
- Customs Duty (Thuế hải quan)
+ Special preferential duty rates (Thuế suất ưu đãi đặc biệt) are applied to
imported goods originating from countries or territories with trade
agreements containing special preferential duty provisions with China.
+ According to ASEAN-China Trade in Goods Agreement (ACFTA tax
rate) in The ASEAN-China Free Trade Area (ACFTA), Seagrape has
special preferential duty rates of 0%.
- Value-added tax (VAT)
+ From April 2019, according to the Announcement of the State Taxation
Administration (STA) on Deepening the Reform of VAT (STA
Announcement [2019] No.39), China’s import VAT on imported goods
has been lowered to either 9% or 13% percent (down from the previous
10% or 16%). And The 9% tax is available for certain goods that fall
mainly within the categories of agricultural and utility items.
 c. Labeling
The national standard "National Food Safety Standards - General Rules for Nutrition
Labeling of Prepackaged Foods" (GB 28050-2011)
The labeling of prepackaged foods directly provided to consumers shall include the
name of the food, list of ingredients, net content and specifications, name, address and
contact information of the producer and/or distributor, production date and shelf life,
storage conditions, food production License number, product standard code and other
contents that need to be marked.
- Food name:
+ Food names should be common and clearly written to avoid confusion
+ In the case of using a special name, the name should be marked in a
conspicuous position on the food label with the same font size, font colors
adjacent to the same display page of the displayed name
- List of ingredients:
+ Various ingredients should be arranged in descending order of the amount
added when manufacturing or processing the food; ingredients whose added
amount does not exceed 2% may not be arranged in descending order.
- Quantitative labeling of ingredients:
+ The added amount of the emphasized ingredients or ingredients or the content
in the finished product should be indicated.
+ If the content of one or more ingredients or ingredients is low or absent on the
food label, it shall be declared in the finished product.
- Net content and specifications:
+ The indication of net content shall consist of net content, numbers and legal
units of measurement (For Tri Tin sea grapes, it must be grams (g) and
kilograms (kg))
+ The minimum height of net content characters should meet the requirements:
 (source: tht.gov.cn)

+ The net content should be marked on the same display panel as the food name
on the package or container, which is applicable to both retail and large
packages

- Names, addresses and contact information of producers and distributors:

+ The name, address and contact information of the producer shall be marked,
and legally registered and able to bear the responsibility
+ The contact information of producers or distributors who bear legal
responsibility according to law shall indicate at least one of the following
contents: telephone, fax, network contact
- Date marking: The production date (shall be marked in the order of year, month and
day) and shelf life of the prepackaged food shall be clearly marked (on the outer
package)
- Storage conditions: The label of prepackaged food shall indicate the storage
conditions
- Food production license number: If the label of prepackaged food should indicate
the food production license number, the form of labeling shall follow the relevant
regulations.
- Edible method: According to the needs of the product, the opening method, eating
method, cooking method, rehydration method, etc. of the container can be marked to
help consumers.

2. Logistics
● Route:
We decided to transport overland from Vietnam to China by truck, the transportation
route will move from Nha Trang, Khanh Hoa province (Vietnam), current main
farming and production place of Tri Tin grape seaweed, to Vietnam - China border,
through international border gates between Vietnam and China, in bordering
provinces such as Mong Cai, Cao Bang, Lang Son, Lao Cai... at the request of
Chinese importers.

● Documents to prepare for road transport from Vietnam to China:

- Sales Contract:
+ Commercial contract is a legal form of commercial act. This is an agreement
between two or more parties to establish the obligations of each party in the
performance of commercial activities.
+ Commercial activities include activities carried out in the territory of the Socialist
Republic of Vietnam, or commercial activities performed outside the territory of
Vietnam in case the parties agree to choose to apply this law or a foreign law, or
international treaties to which Vietnam is a member.
=> In this case, this will be the contract between Tri Tin and the customer company,
the partner to import grape seaweed in China.
 Example
- Commercial Invoice:
+ Commercial invoice is the basic document of payment. Issued by the seller to
require the buyer to pay the amount stated on the invoice.
+ Tri Tin company will have to state the characteristics of the seagrapes goods, the
unit price, the total value of the goods, the conditions of the delivery facility, the
method of payment or delivery of the goods (by truck).
+ This invoice plays an important role, as the basis for recording sales activities in the
business. Commercial invoices are often made in multiple copies to be used for many
different purposes. Including presentation to customs for tax calculation and customs
clearance of goods.
=> This invoice will be the sales invoice of the order placed by the Chinese importer
with Tri Tin.
 Example
- Packing List:
This is an important component in the set of import and export documents. This form
is used to declare and submit the original to customs for goods processing. Content
includes container number, cargo name (sea grapes), cargo weight, and other relevant
information.
 Example
- Bill of Lading:
+ Bill of lading is proof of receipt of goods with quantity, type and characteristics of
goods for transportation to the place of delivery. It is the proof of ownership of goods,
which can be used to dispose of and receive goods.
+ Bill of lading is signed and issued in sets of originals and copies. When paying via
credit card, the seller must present the entire original bill of lading to be paid for the
goods.
+ To receive the goods, the consignee must present an original bill of lading to the
carrier. The bill of lading is also a necessary document to submit to customs when
clearing goods.

Example
- Certificates of Origin:
+ Normally, when importing, it is required to present a certificate of origin issued by
the competent authority of the exporting country. Certificate of origin is very
important in classifying goods according to the customs regulations of the importing
country. Therefore, the import tax rate will be decided.
+ Certificate of origin is a document to prove that goods have clear and lawful origin.
Just like the provisions of the law, is an indispensable document when clearing
customs, especially for food products like Tri Tin.

Example
- Do plant quarantine procedures:
Plant quarantine is an important step to determine whether the export of agricultural
products is of good quality and is a necessary document to help Chinese importers
carry out procedures for importing agricultural products in their country smoothly.
Currently, when in quarantine, the quarantine agency not only checks the records but
also brings the agricultural products to the agency for professional testing. Therefore,
Tri Tin needs to prepare quality products so the agency can issue the phytosanitary
certificate as quickly as possible.
Inspection records include:
+ Referral document
+ Quarantine registration form
+ Invoice
+ Packing list
+ Commercial contract
+ Certificates of planting area standards and product quality standards (if
any)
+ Sample of goods to be quarantined (if necessary)
- In addition to the above basic customs clearance documents, there are a number
of related documents. If requested by the customs side, Tri Tin needs to report.

● Shipping Process:
- Step 1: Receive information

Tri Tin only needs to provide information about goods:

+ Information about transported goods: Name of goods (grape seaweed), quantity,

volume, size, delivery time.

+ Information of recipient (China customer), sender (Tri Tin): Address, phone number
of recipient and sender.

- Step 2: Quotation for freight

After capturing the information from the Tri Tin, the consultant will make the most
suitable options for the customer and the quotation attached to each option, should go
through official or minor quota, should be transported by sea or by road or by air. In
this case, it will be by road.

- Step 3: Consulting on packing, baling and arranging the pickup truck

The staff of DHD Logistics company will advise on how to pack goods in accordance
with transportation regulations, economical specifications, to ensure that the goods are
not dented, broken, damaged during transportation (if the customer transports the
goods the first time) – Goods are transported to the warehouse of DHD Logistics in
Vietnam.

- Step 4: Clear customs and proceed with shipping

DHD Logistics supports Tri Tin to do customs import and export procedures. At the
same time, customers need to provide more documents for the origin of goods to DHD
Logistics. At this step Tri Tin will hand all the documents mentioned above to DHD
for customs clearance.

- Step 5: Finalize the debt and complete the payment

In this step, Tri Tin will have to pay the remaining fee upon receipt of the goods.

● Shipping partner:
We choose DHD Logistics because of its market knowledge, competitive prices,
prestige, seniority in the industry and expertise in transporting Vietnam - China routes.
- Delivery time: Thanks to a stable customer base and extensive relationships
with car companies, airlines, etc. We guarantee your goods will be shipped in
the shortest time. Normally, customers will receive the goods within 3-7 days.

3. Intermediary Customer
These are some potential companies that we have filtered out on the basis of suitable
criteria to be Tri Tin's import partners and potential customers, such as: having regular
imports of grape products with a medium to large scale, stable financial situation,
prestige in the import-export market,...

- QINGDAO JIASHIDI SEAWEED CO.,LTD

QINGDAO JIASHIDI SEAWEED Co., Ltd was established in 1995, and has more
than teen years of experience on producing sodium alginate, iodine which are widely
applied in many industries including printing, dyeing, textile, pharmaceutical, food,
daily cosmetics, agriculture, paper making, and organic synthesis. The company had
passed certification of ISO9001 quality system. The products are now being sold to
most areas of China and have a good reputation. They have obtained self-support right
of import & export, so their products are also being sold to more than ten foreign
countries such as Japan, America, Norway, Korea and Germany, Italy, Thailand,
Turkey, Indonesia, Denmark and enjoy great popularity. In addition, they also have
established a long term supply relationship with them. Their company occupies a land
area of 65 thousand square meters and has more than 500 staff among which 100 are
technologists. They have five sole producing lines for sodium alginate, PGA, mannitol
and iodine, two for sodium alginate, one for PGA, one for mannitol and one for
iodine.

- GREEN FRESH FUJIAN FOODSTUFF CO LTD accounted for maximum

import market share with 614 shipments followed by SINOCHEM HEBEI
CORPORATION with 390.

+ GREEN FRESH FUJIAN FOODSTUFF CO LTD made 720 import shipments,

its top 2 sourcing countries are Indonesia, Philippines. Green Fresh Fujian Foodstuff
Co Ltd's headquarters are in ANSHAN INDUSTRIAL DISTRICT, ZINT COUNTY
LONGHAI, FUJIAN, CHINA.
 The company has a certain reputation as it has 720 shipments and 30 suppliers
around the world.

+ SINOCHEM HEBEI CORPORATION made 4,808 import shipments, its top 3

sourcing countries are Indonesia, India and Sri Lanka. Sinochem Hebei Corporation
headquarters are at 707 LIANMENG ROAD, SHIJIAZHUANG 050061, China.
Seaweed is its top 3 import product after stearic acid and menthol.

Based on the Sample Import Bill Details of Sinochem Co. with the Trung Nam
Hải Co., we can estimate the shipping cost based on the tons of goods shipped.
 Additionally, Sinochem’s net profit has fluctuated over 5 years and increased
sharply in 2021. Hence, it is a good signal and Trí Tín Co can consider cooperating
with Sinochem.

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