Global country study report 2015 16

GLOBAL COUNTRY STUDY REPORT
ON
INFORMATION TECHNOLOGY INDUSTRY OF VIETNAM
w. r. t.
BUSINESS OPPORTUNITIES FOR GUJARAT/MAHARASHTRA IN IT
SECTOR AT VIETNAM
IN PARTIAL FULFILLMENT OF THE REQUIREMENT OF THE
AWARD OF THE DEGREE MASTER OF BUSINESS
ADMINISTRATION (MBA)
OFFERED BY
GUJARAT TECHNOLOGICAL UNIVERSITY
AHMADABAD
SUBMITTED TO
LAXMI INSTITUTE OF MANAGEMENT, SARIGAM
INSTITUTE CODE: 731
UNDER THE GUIDANCE OF: MR. PRANAV RAYTHATHA
(ASSISTANT PROFESSOR)
PREPARED BY Students:
Anandhu Raj, Priya Patel, Rupa Gupta, Purnima Pamdey, Mahesh
Valvi
MBA (4th SEMESTER) 2015-16
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Student’s Declaration
We, following students, hereby declare that the Global Country Study Report titled “Global
Country Study Report on Information Technology Industry/Sector of Vietnam w.r.t
Business Opportunities for Gujarat/Maharashtra” is a result of our own work and our
indebtedness to other work publications, references, if any, have been duly acknowledged.
If we are found guilty of copying any other report or published information and showing as
our original work, or extending plagiarism limit, we understand that we shall be liable and
punishable by GTU, which may include ‘Fail’ in examination, ‘Repeat study & re-submission
of the report’ or any other punishment that GTU may decide .
Enrollment no. Name Signature
147310592002 Anandhu Raj
147310592004 Gupta Rupa
147310592008 Patel Priya
147310592020 Valvi Mahesh
147310592034 Pandey Purnima
Place: …….. Date: ………….
2

Institute Certificate
This is to certify that the Global Country Study and Report on “Global Country Study Report
on Information Technology Industry/Sector of Vietnam w.r.t Business Opportunities for
Gujarat/Maharashtra” is the bonafied work of attached student list with enrolment
numbers, who have carried out their research under my supervision. I also certify further,
that to the best of my knowledge the work reported here in does not form part of any other
project report or dissertation on the basis of which a degree or award was conferred on an
earlier occasion on this or any other candidate. I have also checked the plagiarism extent of
this report which is - % and the separate plagiarism report in the form of html/ pdf file is
enclosed with this.
Signature of the Faculty Guide/s
(Asst. Prof. Pranav Raythatha)
Signature of Principal/Director
(Dr. Keyur. Nayak)
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PREFACE
As the part of curriculum of Gujarat Technological university, the students of the second
year of MBA have to undergo a training program in which they have to select any
organization or company or industry or sector of foreign country and study the details of
that country and find out the existing business and future business potential of that
industry/company/sector with India.
Our group has studied Information Technology industry of India and Vietnam with an
objective to find business opportunities at Vietnam for state Gujarat and Maharashtra.
Here, we have carried out Macro analysis. The macro analysis was based on STEEPLED
Analysis and SWOT Analysis of Information Technology sector at Vietnam. Here, we
compared India and Vietnam on the basis of factors such as Social, Technological, Economic,
Environment, Political, Legal and Demographic. We come to know about strength of India in
IT sector and what are weakness and opportunity for India at Vietnam. Next, we have
carried out micro analysis which involves selection of IT Company of India and how it can be
set up at Vietnam. We studied how Indian company can grab opportunity at Vietnam. We
studied about rules and regulations at Vietnam for IT sector and also developed a business
plan. Finally, we concluded that Indian IT Company can enter at Vietnam by Joint venture,
Exporting and Outsourcing.
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ACKNOWLEDGEMENT
We would like to express our sincere gratitude and appreciation to the GTU for giving an
opportunity to undergo The Global Project which was beneficial and valuable to develop
within us the interpersonal and intrapersonal academics skills.
We would like to thanks the campus director of Laxmi Vidyapeeth, Sarigam Mr.George
Thomas and the director of Laxmi Institute of Management Dr. Keyur M. Nayak for their
constant motivation throughout the project.
We are extremely thankful and grateful to our GCSR project guide Mr. Pranav Raythatha for
giving their constant guidance, supervision, wise idea and encouragement throughout the
study and truly helped in the progression and smoothness of the project.
We also like to express our thank and gratefulness to all our colleagues for their enormous
efforts at all levels as we all have worked to completed the project successfully and on time
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EXECUTIVE SUMMARY
INTRODUCTION OF ENJAY I.T. SOLUTIONS LTD
Enjay is Technology Company helping small business grows big and big business grows
bigger. Enjay is known for their E-innovative solutions offerings for Indian SME market. Enjay
offers Smart Enterprise class Storage, Telephony, Linux on Desktop, Cloud, Desktop
Monitoring solutions. All solutions are developed in house by Enjay; hence anything and
everything can be customized according to your business requirement - in a very short time
and at a very reasonable cost.
Reduce hardware cost and software licensing costs, with help of Thin Client technology and
Operating system solutions.
Increase employee efficiency and Customer Satisfaction with the help of innovative CRM,
Telephony and employee monitoring solutions.
Enjay IT Solutions (Empowering Enterprise with Enovation), is an IT Company based in Vapi,
Gujarat - constantly endeavoring in making solutions which will benefit SME (Small and
medium enterprises) sector.
Vision and Mission
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Vision
Small and medium size enterprises in India are the growth engine of Indian economy.
Collectively they contribute $180 Billion of revenue with high growth rate and provide
employment to 75% of workforce in India through the manifestation of the relentless
entrepreneurial dreams. And, all these entrepreneurs run their business on a very tight
budget. Founders of Enjay dreamed to enable these millions of entrepreneurs with
innovative, inexpensive and useful business products. Enjay wants to Empower Enterprise
with Enovation.
Mission
Enjay started in 2007 with a vision to empower SMEs (Small and medium enterprises) in
India with innovative and inexpensive business solutions.
The Company has since launched products that have been sold in various segments of SME
industry and also education. Enjay's mission is to provide ground breaking technology
solutions which are affordable to customers and profitable to partners.
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Growth
In a very short period Enjay has achieved high growth from a small family startup to a 100+
team with revenue ranging in several crores of rupees. The success has come through the
focused leadership and exceptional contribution from each and every single Team Member.
The company is now looking beyond the geographical boundaries to foray into developed
&other developing markets where it can deliver cutting-edge Solutions leveraging the
benefit of inexpensive infra from India.Domain knowledge and the experience are the
biggest strengths of the company that help in serving thousands of businesses in India.
Team Enjay
Behind every successful company there is a hard working team of smart people. We are
people who can bring a method to the madness, and establish priorities and always remain
focused on the results. At Enjay, Enovation comes from every corner - not just technical or R
& D department.
Leadership
1) LATE Narendra Parekh President Co-founder
Mr. Narendra Parekh was a very senior veteran in Finance, administration and
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Management. He is father figure and source of inspiration. He has a great passion for
processes and teams that is effective and efficient.
2) Limesh Parekh CEO, Co-Founder
Limesh has work experience in business strategy, marketing, technology and
organizational effectiveness. He is passionate about the strategic application of technology
as a tool for total business transformation. Limesh graduated from Mumbai University with
degree in Commerce, and then from Institute of Chartered Accountancy. He received his
GNIIT from NIIT, Mumbai In 1994
3) ChaitanyaParekhVP, Co-founder
Heading the Enjay Linux Initiative, and also looking after various development
projects at Enjay. He has great passion for 100% perfection in the solutions that comes out
of Enjay. He has graduated from Mumbai in IT.
4) Siddheshwar Parekh VP, Co-founder
Head of the R&D and Engineering division of Enjay. Also looking into the operations.
He has knack of understanding the technology and implications very fast. Always gleaming
with new ideas he drives the Enovation at Enjay. He has graduated from Mumbai in IT.
COMPANY HISTORY
Enjay started its journey as Enjay Computer Consultancy - way back in 1994/95,
providing services like Assembly of Hardware, Maintenance, peripherals etc. It was
started by 3 idiots, Limesh, Chaitanya&Siddheshwar Parekh (3 brothers). Infact name
Enjay comes from first initials of Narendra&Jyotsna - Parents of these 3 idiots.
Then in 1997 / 98, it was converted to Enjay Network Solutions, and the focus shifted
from hardware to Networking, Linux etc. In 1998, Enjay launched remote booting of
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Windows 95 (running win95 without HDD, remember HDD was very costly then), which
was quite revolutionary at that time. But there was a limitation to this solution, it could
not be sold thru a reseller, it was a kind of consultancy.
In 2003 / 04, Enjay Thin Client card was released. The Model was scalable. At that time
Thin Client was very new concept, and acceptance was very low. But slowly business
grew, and Enjay became to be known as Thin Client "Card Wala". By end of 2009, Enjay
had dealers across India. The Team size grew from 4 to 13.
In 2009/10, Enjay started R & D on Telephony & CRM, which were then launched in
2011 / 12, and by 2013 - that solution became very unique and useful. Enjay also
launched Storage Solutions & employee monitoring. These solutions positioned Enjay as
a preferred solution provider for Small Businesses. The team size grew from 14 to 70.
In all these years, two things did not change, and that was Enovation & love for Open
Source. That is the reason all the solutions by Enjay are based on Open Source only,
almost all of them are very innovative.
SWOT Analysis
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Strength
1. Enjay has been building a full set of SAP life cycle services, from
consulting to implementation, managed services, BPO and hosting,
while depending its technical and functional capability.
2. Increasing focus on domain-led solutions has led to investments in
process maps, data models and solutions for numerous industries,
including manufacturing, retail and CPG, life sciences, banking and
insurance, travel and transportation, telecom, media and entertainment,
and energy and utilities, as well as solutions in areas that are not
currently addressed by SAP, such as dealer management and legal
management solutions.
3. Clients cite enjay commitment to delivery excellence, flexibility to
changing requirements, great teamwork and technical expertise as key
strength.
4. Enjay has large client base (936 clients) and balanced geographical
revenue base with the lowest reliance on North America amongst top tier
IT companies.
5. Man power strength is less in enjay thus, it help to developed
personalized career.
Weakness
1. Fuelling the rapid growth has resulted in Enjay relying more on junior,
albeit well-trained, resources, which has given rise to client’s perception
of inconsistent quality of consultants, skills mismatch and resource ramp-
up delays.
2. Although making strides, Enjay still needs to improve its consulting
capabilities and process depth to be truly a business and not solely a
technology partner.
3. Clients indicate that Enjay could improve on its project management,
communication and user change management skills areas that Enjay is
actively working on to improve.
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Opportunitie
s
1. Continuing investments in technology by its clientele, a growing
preference for global sourcing and the emergence of newer technologies
and business models offer many opportunities for Enjay, its integrated
full services capability global delivery footprint and scale have expanded
its addressable market, strengthened its reputation and ensured its
inclusion in the top tier list of vendors invited for the largest and most
complex bids. These offer a sizable growth opportunity for Enjay.
2. Evolution of non-liner delivery models which could positively impact
margins, superior platform offering (diligenta, citigroup global services)
nearing maturity which could expand the scope for cross selling.
Threats
1. Industry wide supply side pressures leading to attrition, wage inflation
and eroding margins.
2. Innovation product/services of competitors.
3. New competitors entering the market.
4. Economic slowdown in the key markets and potential anti offshoring
legislation.
PORTER’S FIVE FORCES MODEL FOR INDIAN IT SECTOR
a). Existing competition:
The IT Industry landscape is characterised by intense completion for conventional IT
services: Application Development & Maintenance, IT Infrastructure Management Services,
Network Management Services, and Data-center Services etc. leading therefore to
commoditization. There are several firms in the market offering similar services and it is
difficult to differentiate based on these service offerings. The existing competition comes
from both domestic players (Infosys, TCS, Wipro, HCL technologies, Tech Mahindra,
Mindtree and so forth) and international ones (IBM, Accenture, Capgemini, Cognizant and
so forth).
b). Bargaining power of customers:
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For conventional IT services, bargaining power of the buyer is large and the possibility of
pressure on rates exists. The buyer, having worked with both with international IT providers
as well as Indian ones is largely the price setter and has negated (to a large extent) the
offshore advantages through mature procurement and global delivery. The international IT
firms too have negated the advantage enjoyed by Indian IT companies through captive
centres in India and globally. In this industry, in case of conventional IT services, the buyer is
king!
c). Bargaining Power of Suppliers:
The bargaining power for suppliers is very low and since high-standardization exists, there is
little scope of suppliers having any clout. The suppliers consists of IT Infrastructure providers
(Servers, computers etc.), Recruitment firms, Office Space Suppliers etc.
d). Threat of New Entrants:
In context of the highly commoditized IT services, there is little threat of new entrants. That
said, the Industry is also characterized by high people dependence and therefore can see
veterans detach from existing companies to invest in new ventures. An example of this is
Happiest Minds, which was started by a co-founder of an existing IT provider. The newer
technologies allow the possibility of new niche players that are not dependant on size or
experience constraints.
e). Availability of Substitutes:
There are no substantial substitutes to IT services apart from Internal IT departments, which
have lost clout over the years and are ever thinner in numbers and significance. One
argument for internal IT is retaining control over pertinent aspects of business but the
argument against would be since , it should outsource as much as possible and focus on
future growth in core areas. Over time there has been a steady decrease in in-house IT
development and maintenance with more and more being outsourced and the internal IT
staff has settled into a supervisory (program management) role. This has been a mixed bag
for newer services as well since internal specialization is very low, most of the work is
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outsourced. For critical areas, governance has been retained in-house and this trend seems
to have found favour with most large enterprises worldwide.
PORTER’S FIVE FORCE MODEL FOR VIETNAM IT SECTOR
a). Existing Competition:
One of the problems in the IT environment in Vietnam is the government’s habit of enacting
laws over the top of existing ones. This leads to uncertainty over which rule apply, even
outright conflicts. A new unfair competition regulation issued in July illustrates this problem.
Decree 71 was issued to set out remedies for unfair competition violations. However a
2013Decree 99 already covers sanctions for IP violations including unfair competition. The
first problem is the bodies who deal with unfair competition. Decree 71 says it is the
Competition Authority at the Ministry of Trade and Industry.
b). Bargaining Power of Buyers: Porter’s Five Forces Analysis:
The presence of powerful buyers reduces the profit potential in an industry. Buyers increase
competition within an industry by forcing down prices, bargaining for improved quality or
more services, and playing competitors against each other. The result is diminished industry
profitability. The bargaining power of buyers comprises one of Porter’s five forces that
determine the intensity of in an industry. The others are barriers to entry, industry rivalry ,
the threat of substitutes and the bargaining power of suppliers .
The second force is the bargaining power of suppliers (Porter, 1990). All companies that
manufacture goods need to obtain raw materials from external parties or suppliers. Hence,
it is imperative that companies establish good relationships with their suppliers so as to get
favorable prices and a steady supply of raw material. Yet, the supplier-manufacturer
relationship is rarely one of equals (Griffin, 2001). Normally, one party has the upper hand.
Suppliers have greater bargaining power if there are few of them so they can dictate terms
to the customers who are at their mercy (David, 2009). Bargaining Power of Suppliers
Information Technology this report serves a number of major purposes.
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The third force is the threat of new entrant (Porter, 1990). New entrants to a market can
seriously affect the market share of existing members and this is a constant source of
anxiety for companies. In an ideal free market system, a company can enter and exit a
market with the greatest ease and that profits will be nominal. However, in the real world,
there are numerous barriers to entry, some of which are the result of economics, while
others are the outcome of government intervention (Rugman and Hodgetts, 1995).
e). Threat of Substitutes:
The fourth is the threat of substitutes, which refers to products in other industries (Porter,
1990). If the costs of the products in a particular industry are too high, customers might
switch to products in other industries. Price is not the only variable but changes in
technology have the potential to make users flock to rivals (David, 2009).
BUSINESS PLAN
Market Analysis : 4P’s
Product in the Business Plan
Enjey Solutions can offers following products and services in Vietnam
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• Tiguin OS
Linux on Desktop has always been a dream, with huge FUD around it. Not any more.
With Tally, SAP, office, Email, Internet Browser and many other software on Linux.
Now Linux on Desktop is Possible.
• Thin Clients
Enjay Thin Client solution, powered by Enjay Tornado OS, is right blend of hardware
and software which offers affordable yet powerful computing for SMB, Easy to
integrate with Windows or Linux Environment.
• Storage Solutions
EnjayStoreVol NAS offers RAID 1,5,6,10 to protect your data and keep your business
running. With builtin Backup tool and Disaster Recovery solutions.
• Enjay CRM
Hosted CRM, based on SugarCRM. Fully customised for Indian Small Businesses.
Complete Sales / Support lifecycle management. Lots of add-ons and integrations
available.
• Enjay Synapse
Enjay Synapse is a solution with support for IVRS, CTI (computer telephony
integration), voice logger, call recording and detail reporting very useful for
telemarketing, telesupport and Call Center.
• EnjayEnsight
Capture video and screen of your employees computers and get report of
application usage from EnjayEnsight PC Activity Monitoring software.
Place in the Business Plan
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Place refers to the distribution channel of a product. If a product is a consumer product, it
needs to be available as far and wide as possible. If the product is a business product, you
need a team who interacts with businesses and makes the product available to them. Thus
the place where the product is distributed depends on the product and pricing decisions, as
well as any STP decisions taken by a firm.
Price in the Business Plan
Pricing of a product depends on a lot of different variables and hence it is constantly
updated. Major consideration in pricing is the costing of the product, the advertising and
marketing expenses, any price fluctuations in the market, distribution costs etc.
Price Chart of Major Products and Services for Vietnam market
Product&Services Customizability Price Range
Tiguin OS Yes 20000-50000
Thin Clients Yes 100000-120000
Storage Solutions Yes 75000-100000
Enjay CRM Yes 50000-150000
Enjay Synapse Yes 10000-20000
EnjayEnsight Yes 10000-20000
Promotion in the Business Plan
Enjey Solutions is not gives prime importance to its advertisement and promotional
strategies. Company has a good image among the client and it spreads through clients to
clients.The company’s favorite form of advertisement is using the online media and
internet, although the a multi-media campaign to create awareness amongst the consumers
about the various products and services it provides. In Vietnam also company can follow the
same promotional methods to attract the clients.
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 The promotion budget can be 15% of sales.
Advantage of investment in Vietnam – why invest?
 Strategic location
The location of Vietnam provides it a lot of trade benefits. It situated in the center of
southeast Asia. One of the major components to attract foreign investors is Vietnam's is that
its ability to enter Southeast Asia's other major and developing markets.
 Favorable investment climate
Since the past 3 decades, Vietnam has become as one of the most attractive places for
foreign investors. To achieve cost-effectiveness in their global supply chains investors have
been consider Vietnam as a major strategic investment location.
 Increasing Exports
Because it is highlighted by its high import and export volumes Vietnam has been one of the
most open economies in international trade.
 Demographic Advantage
Highly literate Young, hard-working, and easy-to-train labor force is one of the major
advantages of Vietnam as an investment destination . From the total population of Vietnam,
about 60% is below the age of 25 years. The literacy rate for the population aged 15 years
and above is approximately 94%. This is the result of the importance and priority given by
the Government of Vietnam to the development of quality training and education system in
Vietnam.
 Double Tax Avoidance Agreements (DTAs)
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Vietnam has already entered into DTAs with more than 50 countries at various stages of
implementation and negotiation,. The following are the countries with which Vietnam has
signed DTAs.
Countries with which Vietnam has signed DTA agreements
Australia Hungary China Switzerland Taipei
France Poland Romani Mongolia Algeria
Thailand Netherlands Malaysia Bulgaria Myanmar
Sweden Denmark Laos Italy Finland
South Korea Norway Belgium Belarus Philippines
UK Japan Luxembourg Czech Republic Saudi Arabia
Singapore Germany Uzbekistan Canada Iceland
India Russia Ukraine Indonesia Korea Republic
 Tax incentives
The generally applicable Corporate Income Tax (CIT) in Vietnam is 25%. However, core Sectors like
health, education, high-tech, infrastructure development and software and encouraged special
economic zones or areas with difficult socio-economic conditions preferential tax treatment
including tax exemption, tax reduction and preferential tax rates (10% and 20%) is available for
investments.
 Political stability
Vietnam's political and social stability make it one of the safest investment destinations in Southeast
Asia. Vietnam is a single-party socialist state with a high degree of ethnic, linguistic, and religious
homogeneity.
How to invest successful in Vietnam
Vietnam is a new and emerging market which is offering many opportunities to Investors.
However, being successful in doing business in Vietnam is not easy if you do not understand
market well enough.
• Promote brand awareness and corporate image worldwide
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Vietnamese often prefer famous brand to non-famous one. Almost successful foreign
investors in Vietnam have owned very strong brand name in other countries. Starbuck; KFC;
Canon; Samsung are the typical examples.
• Understand customer needs and Respond proactively
Vietnam is standing out to be a very large and potential market with reaching 100 million
people. However, don’t ever think that is easy market.
Make a difference to your products and services
Difference makes success. If you want to compete and win others, you shall be go ahead
them with creating typical and unique products and services. That is the best way to stand
out from the competitions.
• Develop and Extend network business alliance
Network is the key important in the mutual and globalized market. More networks you
have, more success you get.
REQUIRED DOCUMENTS TO SET-UP SOFTWARE COMPANY IN
VIETNAM
The establishment of a Foreign Invested Company (Hereinafter referred to as “FIC”) in
Vietnam requires an Investment Certificate and a Certificate of Business Registration from
the licensing authority.
Preparing the application dossier:
We shall collect necessary information and documents from you. Upon receipt of necessary
information and documents from you, we shall translate documents from English into
Vietnamese and prepare the application dossier under the standard forms.
Submission of application dossier for obtaining Investment Certificate:
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Within 02working days from receipt of duly signed and sealed application dossier, we shall
submit the application dossier to the competent authority.
Submission of application dossier for obtaining Certificate of Business
Registration:
Within 02 working days from receipt of Investment Certificate, we shall submit the
application dossier to the competent authority for obtaining Certificate of Business
Registration. It shall take about 07 working days to complete.
•Post licensing:
Within 13 working days we shall complete the post licensing procedure such as publishing
the FIC in National Database of Enterprise Registration, obtaining sea land tax code
registration.
MODES OF ENTRY
To find the way of how to enter a foreign market can have a significant impact on the
results. Expansion into foreign markets can be achieved through the following four
mechanisms:
a) Exporting
b) Licensing
c) Joint Venture
d) Direct Investment
a) Exporting:
Exporting commonly requires coordination among four players:
 Exporter
 Importer
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 Government
 Transport provider
b) Licensing:
Licensing permits a company to enter into the target country to use the property of the
licensor. Such property usually is intangible, like trademarks, patents, and production
techniques.
c) Joint Venture:
There are five common reasons for why company go for a joint venture: market entry,
risk/reward sharing, technology sharing and joint product development, and conforming
to government regulations.
d) Foreign Direct Investment:
Direct foreign investment had to form through the attainment of an existing entity or
the establishment of a new enterprise. However, it requires a high level of resources and
a high degree of commitment.
FORMS OF INVESTMENT IN VIETNAM
According to the Vietnam Law on Investment (2005), foreign investors can invest in
Vietnam through direct investment and indirect investment.
Direct investment Indirect investment
The direct investment is when such the
investor invests its invested capital and
also makes an active participation in the
management of the investment
activities, includes:
 To invest in business
Indirect investment means a form of
investment whereby the stockholder do
only donate the wealth but do not
actively participate in the management
of the investment activity includes:
 Through other midway financial
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development.
 To purchase shares or to
contribute capital in accordingly
to participate in management of
investment activities.
 To found economic organizations
in the form of one hundred per
cent (100%) capital of domestic
investors or one hundred per
cent (100%) capital of foreign
investors.
institutions.
 Buying of shareholding, shares,
bonds and other valued papers;
 Through securities investment
reserves;
TYPES OF ENTERPRISE FOR FOREIGN INVESTORS TO INVEST IN
VIETNAM
a) Limited Liability Company
Here a member shall be responsible for the duties and other stuff obligations of the
enterprise within the amount of capital that had to undertake to contribute to the
enterprise. Limited liability companies are regulated by two types:
• One member Limited Liability Company which has enterprise who should be owner
of one organization or individual;
• In Limited Liability Company if two or more members are an enterprise must have
owned by organizations or individuals, in which the number of members shall not
less than two members and not exceed fifty.
b) Joint Stock Company:
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• Joint Stock Company is an enterprise which has charter capital divided into equal
portions called shares. Shareholders shall be liable for the debts and other property
obligations of the enterprise only within the amount of capital contributed to the
enterprise.
c) Partnership:
• A partnership is that enterprise where compulsorily at least two members being co-
owners of the company jointly conducting business under one common name. In
addition to unlimited liability partners, there may be limited liability partners.
d) Representative Office of foreign trader:
• A foreign business entity or a foreign trader is allowed to establish Representative
Office in Vietnam. Representative office of a foreign business entity in Vietnam
(referred as “Representative Office”) means a subsidiary unit of the foreign business
entity, which is established in accordance with the law of Vietnam in order to survey
markets so that one can know, more about the markets and to undertake a number
of commercial enhancement activities permitted by the law of Vietnam.
e) Branch of foreign trader:
• Branch means a subsidiary unit of the foreign business entity, established in
accordance with the law of Vietnam in order to enter into contracts in Vietnam and
conduct activities being the purchase and sale of goods and other commercial
activities consistent with its license for establishment in accordance with the law of
Vietnam and any international treaty to which the Socialist Republic of Vietnam is a
member.
f) The investing measures by signing Contracts:
• Business co-operation contract (BCC) means the investment form signed between
investors in order to co-operate in business and also to share profits or products
without creating a legal entity.
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India’s Import & export Policy: Procedures and Duties
Import Procedure:
Import trade refers to the purchase of goods from a foreign country. From country to
country the procedure for import trade differs depending upon the import policy, statutory
requirements and customs policies of different countries. In almost all countries of the
world import trade is controlled by the government.
The steps taken in import procedure are discussed as follows:
(i) Trade Enquiry:
The first stage in an import transaction, like any other transaction of purchase and sale
relates to making trade enquiries. Agent for information regarding the price and the terms
on which the exporter will be able to supply goods.
(ii) Procurement of Import License and Quota:
The import trade in India is controlled under the Imports and Exports (Control) Act, 1947. A
person or a firm cannot import goods into India without a valid import licence. An import
licence may be either general license or specific licence.
For the purpose of issuing license, the importers are divided into three categories:
(a) Established importer,
(b) Actual users, and
(c) Registered exporters, i.e., those import under any of the export promotion schemes.
(iii) Obtaining Foreign Exchange:
Since the importer has to make payment for the imports in the currency of the exporting
country after obtaining the license, the importer has to make arrangement for obtaining
necessary foreign exchange
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(iv)Placing the Indent or Order:
After the initial formalities are over and the importer has obtained the licence quota and the
necessary amount of foreign exchange, the next step in the import of goods is that of
placing the order. This order is known as Indent. An indent is an order placed by an importer
with an exporter for the supply of certain goods.
(v) Dispatching a Letter of Credit:
The exporter before shipping the goods wants to be sure about the creditworthiness of the
importer generally; foreign traders are not acquainted to each other and so. The exporter
wants to be sure that there is no risk of non-payment. Usually, for this purpose he asks the
importers to send a letter of credit to him.
(vi) Obtaining Necessary Documents:
After dispatching a letter of credit, the importer has not to do much. On receipt of the letter
of credit, the exporter arranges for the shipment of goods and sends Advice Note to the
importer immediately after the shipment of goods. An Advice Note is a document sent to a
purchaser of goods to inform him that goods have been dispatched. It may also indicate the
probable date on which the ship is expected to reach the port of destination.
There are two types of documentary bills:
(a) D/P, D.P. (or Documents against payment) bills.
(b) D/A, D.A. (or Document against acceptance) bills.
If the bill of exchange is a D/P bill, then the documents of title of goods are delivered to the
drawee (i.e., importer) only on the payment of the bill in full. D/P bill may be sight bill or
usance bill.
Usance bill is to be paid within a particular period after sight. If the bill is a D/A bill, then the
documents of title of goods are released to the drawee on his acceptance of the bill and it is
retained by the banker till the date of maturity
26

(vii) Customs Formalities and Clearing of Goods:
After receiving the documents of title of the goods, the importer’s only concern is to take
delivery of the goods, when the ship arrives at the port and to bring them to his own place
of business. The importer has to comply with many formalities for taking delivery of goods.
(a) To obtain endorsement for delivery or delivery order:
When the ship carrying the goods arrives at the port, the importer, first of all, has to obtain
the endorsement on the back of the bill of lading by the shipping company.
(b) To pay Dock dues and obtain Port Trust Dues Receipts:
The importer has to submit two copies of a form known as ‘Application to import’ duly filled
in to the ‘Lading and Shipping Dues Office’. This office levies a charge on all imported goods
for services rendered by the dock authorities in connection with lading of goods.
(c) Bill of Entry:
The importer will then fill in form called Bill of Entry. This is a form supplied by the custom
office and is to be filled in triplicate.
(d) Bill of Sight:
If the importer is not is a position to supply the detailed particulars of goods because of
insufficiency of information supplied to him by the exporter, he has to prepare a statement
called a bill of sight.
(e) To pay Customs or Import Duty:
There are three types of imported goods:
(i) Non dutiable or free goods,
(ii) Goods which are to be sold within the country or which are for home consumption, and
27

(iii) Re-exportable goods i.e. goods meant for re-export. If the goods are duty free, no
import duty is to be paid at the custom office.
(f) Bonded and Duty paid Warehouses:
The port trust and custom authorities maintain two types of warehouses-Bonded and Duty
paid.
The bonded warehouses are used by the importer when:
(i) He has no go down of his own.
(ii) He cannot pay the duty immediately.
(iii) He wants to re-export the goods and thereby does not want to pay the duty.
(iv) He wants to pay the duty in installments.
(g) Appointment of clearing Agents:
The importer may take the delivery of the goods himself at the port. But it involves much of
time, expenses and difficulty.
(h) Making the Payment:
The mode and time of making payment is determined according to the terms and conditions
as agreed to earlier between the importer and the exporter. In case of a D/P bill the
documents of title are released to the importer only on the payment of the bill in full.
(i) Closing the Transactions:
The last step in the import trade procedure is closing the transaction. If the goods are to the
satisfaction of the importer, the transaction is closed. But if he is not satisfied with the
quality of goods or if there is any shortage, he will write to the exporter and settle the
matter.
28

Export Procedure
Export procedure describes the documents required for exporting from India. Special
documents may be required depending on the type of product or destination. Certain
export products may require a quality control inspection certificate from the Export
Inspection Agency. Some food and pharmaceutical product may require a health or sanitary
certificate for export.
The following are the export documents required for the processing of the Shipping Bill:
• GR forms (in duplicate) for shipment to all the countries.
• 4 copies of the packing list mentioning the contents, quantity, gross and net weight
of each package.
• 4 copies of invoices which contains all relevant particulars like number of packages,
quantity, unit rate, total f.o.b./ c.i.f. value, correct & full description of goods etc.
• Contract, L/ C, Purchase Order of the overseas buyer.
• AR4 (both original and duplicate) and invoice.
• Inspection/ Examination Certificate.
REGULATIONS OF VIETNAM’S IMPORT& EXPORT
• Within Vietnam Some time ago an sponsor has set up their trading company, it is
very necessary to know that the country’s import and export regulations and actions
of their workers gain a strong understanding of following companies must be aware
of before starting their trading functions in Vietnam. That lay out the key takeaways.
Procedures of Import and Export Licensing:
• In order to set up a trading company Vietnam does not require a company to have
an import/export license. In import/export activities must follow the procedures for
adjusting their Investment Certificates companies that wish to expand their current
29

business operations in order to engage however, additionally foreign investors who
wish to engage in import/export activities in Vietnam are required to obtain an
Investment Certificate. In order to be able to conduct import/export business, a
foreign investor must register with the Department of Planning and Investment
(DPI).
Duties for Import/Export:
• Between the domestic market and a non-tariff zone, are subject to import/export
duties. Most goods imported/exported across the borders of Vietnam, or which pass
exceptions to this include goods. From a non-tariff zone, and goods passing from one
non-tariff zone to another in transit, goods exported abroad.
 Imports of Vietnam:
Country Vietnam imposes a tax on almost every type of product that is imported. For
example, consumer products and luxury goods are extremely taxed while tools,
equipment, and raw materials, tend to take delivery of lower taxes and even tax
exemptions., Imports are subject to import tax, Value-added tax (VAT) and, for certain
goods, Special Consumption Tax (SCT) .The import tax rates range depending on the type
of product.
Goods include preferential tax rates, special preferential tax rates, and ordinary tax rates
.Tax rates applicable to imported:
• Preferential tax rates apply to goods originating from countries, which apply the
most favored nation treatment groups of countries, or territories.
• Special preferential tax rates apply to goods originating from countries, which apply
special preferences on import tax to Vietnam groups of countries, or territories.
• Ordinary tax rates will be no more than 70 percent higher than the preferential tax
rates specified by the government.
30

• Ordinary tax rates apply to goods originating from countries, which do not apply the
most favored nation treatment of special preferences on import tax to Vietnam
groups of countries, or territories.
VAT rates range from zero to ten percent, with ten percent being the most common rate.
Detailed information can be found in Decree No. 83/2014/TT-BTC.
 Exports of Vietnam:
For export tax only certain commodities are liable. From zero to 45 percent export taxes
range. Subject to Value-added Tax Many goods are also. Goods for export, but instead sell
the products domestically, are liable for SCT In addition, the Law on Special Consumption
Tax (SCT) stipulates that exporters who purchase SCT tax-liable. For the year 2014, the tax
tariff can be found in Circular 164/2013/TT—BTC; Circular 17/2014/TT-BTC and Circular
30/2014/TT-BTC. Goods are specified for each item in the Export Tariff. VAT on exported
goods is zero percent.
New Circulars which will either replace or supplement the previous ones. The export tax
rates applicable to exported whenever there is an update in the tax tariff, the Ministry of
Finance will issue it.
Tax exempt goods of Vietnam:
Imported and exported goods are exempt from tax; these include the following in certain
situations:
 Goods imported for processing for foreign partners then exported or goods exported
to foreign countries for processing for Vietnam then re-imported under processing
contracts goods temporarily imported for re-export or temporarily exported for re-
import.
 Goods imported in service of petroleum activities goods imported to create fixed
assets for projects entitled to investment incentives or investment projects funded
with official development assistance (ODA) capital sources.
31

 Activities of scientific research and technological development goods imported for
direct use.
 Tax Calculation of Vietnam:
These are adorned in the customs declaration and are multiply by the tax calculation
cost and the tax rate of each item, which is affirmed in the tariff at the time of tax
calculation. The billed import/export tax amount is equal to the unit volume of each
actually imported/exported goods item. The tax calculation methods are specified
below:
 Payable Tax = unit volume of each actually imported/exported goods item x the tax
calculation price x the tax rate of each item at time of calculation
 For goods items subject to absolute tax: Payable tax = unit volume of each actually
imported/exported goods item x the absolute tax rate provided for a goods unit at
time of tax calculation
32

1. Business Plan- INTRODUCTION OF ENJAY I.T. SOLUTIONS LTD
34
SR.NO PARTICULAR Page No.
1 Business Plan- INTRODUCTION TO ENJAY PVT LTD 1
2 SWOT ANALYSIS OF ENJAY PVT LTD 11
3 POTERS FIVE FORCE MODEL:
-INDIAN IT FIVE FORCE MODEL
-VIETNAM IT FIVE FORCE MODEL
13
17
4 BUSINESS PLAN 21
5 MARKET ANALYSIS 22
6 REQUIRED DOCUMENT TO SET UP SOFTWARE
COMPANY IN VIETNAM
33
7 MODES OF ENTRY 35
8 INDIAN EXPORT –IMPORT POLICY 43
9 VIETNAM EXPORT -IMPORTVPOLICY 47
10 SUPOORTING INSTITUTE TO FACILITATE IMPORT-
EXPORT
50
11 FINANCIAL DADA
-PROJECTED BALANCE SHEET
- PROJECTED P&L ACCOUNT
-PROJECTED CASH FLOW
-RATIO
-BREAK EVEN ANALYSIS
51
52
55
57
58
62
12 FINDING 64
13 SUGGESTIONS 65
14 CONCLUSION 66
15 BIBLOGRAPHY 67

Enjay is Technology Company helping small business grows big and big business grows
bigger. Enjay is known for their E-innovative solutions offerings for Indian SME market. Enjay
offers Smart Enterprise class Storage, Telephony, Linux on Desktop, Cloud, Desktop
Monitoring solutions. All solutions are developed in house by Enjay; hence anything and
everything can be customized according to your business requirement - in a very short time
and at a very reasonable cost.
Reduce hardware cost and software licensing costs, with help of Thin Client technology and
Operating system solutions.
Increase employee efficiency and Customer Satisfaction with the help of innovative CRM,
Telephony and employee monitoring solutions.
35

Company Profile
Enjay IT Solutions (Empowering Enterprise with Enovation), is an IT Company based in Vapi,
Gujarat - constantly endeavoring in making solutions which will benefit SME (Small and
medium enterprises) sector.
Vision and Mission
Vision
Small and medium size enterprises in India are the growth engine of Indian economy.
Collectively they contribute $180 Billion of revenue with high growth rate and provide
employment to 75% of workforce in India through the manifestation of the relentless
entrepreneurial dreams. And, all these entrepreneurs run their business on a very tight
budget. Founders of Enjay dreamed to enable these millions of entrepreneurs with
innovative, inexpensive and useful business products. Enjay wants to Empower Enterprise
with Enovation.
Mission
36
Enjay IT Solutions LTD.
4th Floor, Asopalav Building, Bhilad - 396105.PH. No: 0260-
6612900-02 (100 lines)

Enjay started in 2007 with a vision to empower SMEs (Small and medium enterprises) in
India with innovative and inexpensive business solutions.
The Company has since launched products that have been sold in various segments of SME
industry and also education. Enjay's mission is to provide ground breaking technology
solutions which are affordable to customers and profitable to partners.
Growth
In a very short period Enjay has achieved high growth from a small family startup to a 100+
team with revenue ranging in several crores of rupees. The success has come through the
focused leadership and exceptional contribution from each and every single Team Member.
The company is now looking beyond the geographical boundaries to foray into developed
&other developing markets where it can deliver cutting-edge Solutions leveraging the
benefit of inexpensive infra from India.Domain knowledge and the experience are the
biggest strengths of the company that help in serving thousands of businesses in India.
Team Enjay
37

Behind every successful company there is a hard working team of smart people. We are
people who can bring a method to the madness, and establish priorities and always remain
focused on the results. At Enjay, Enovation comes from every corner - not just technical or R
& D department.
Leadership
1) LATE Narendra Parekh President Co-founder
38

Mr. Narendra Parekh was a very senior veteran in Finance, administration and
Management. He is father figure and source of inspiration. He has a great passion for
processes and teams that is effective and efficient.
2) Limesh Parekh CEO, Co-Founder
Limesh has work experience in business strategy, marketing, technology and
organizational effectiveness. He is passionate about the strategic application of technology
as a tool for total business transformation. Limesh graduated from Mumbai University with
degree in Commerce, and then from Institute of Chartered Accountancy. He received his
GNIIT from NIIT, Mumbai In 1994
3) ChaitanyaParekhVP, Co-founder
Heading the Enjay Linux Initiative, and also looking after various development
projects at Enjay. He has great passion for 100% perfection in the solutions that comes out
of Enjay. He has graduated from Mumbai in IT.
4) Siddheshwar Parekh VP, Co-founder
Head of the R&D and Engineering division of Enjay.Also looking into the operations.
He has knack of understanding the technology and implications very fast. Always gleaming
with new ideas he drives the Enovation at Enjay. He has graduated from Mumbai in IT.
Enjay Client List who are using Enjay CRM / Synapse ( Telephony Solutions ):
1. Mahaonline
2. MP Online
39

3. Bank Of Baroda
4. Insight Business Machines Pvt Ltd
5. Rutu Marketing
6. Jai Research Foundations
7. Acma Computers Pvt Ltd
8. Jhariwala Lab
9. Chowgule Industries Ltd - Pune
10. Phoenix Medicals Pvt Ltd
Client list for Enjay CRM &Enjay Synapse
• Hem Infotech (Ahmedabad
• Adarsh Credit Co-Operative society Ltd
• Punjab Group of Colleges Ambala Education
• Protech Microsystems India Pvt ltd
• System Solution Baroda
• Security Weaver LLC
• Chawla Publications (p) Ltd.
• Omnex India Pvt Ltd.
• Navaida solutions LLC – Dubai
• Soluçõesem CRM – brazil
• Spooky Zebra - London
COMPANY HISTORY
40

Enjay started its journey as Enjay Computer Consultancy - way back in 1994/95,
providing services like Assembly of Hardware, Maintenance, peripherals etc. It was
started by 3 idiots, Limesh, Chaitanya&Siddheshwar Parekh (3 brothers). Infact name
Enjay comes from first initials of Narendra&Jyotsna - Parents of these 3 idiots.
Then in 1997 / 98, it was converted to Enjay Network Solutions, and the focus shifted
from hardware to Networking, Linux etc. In 1998, Enjay launched remote booting of
Windows 95 (running win95 without HDD, remember HDD was very costly then), which
was quite revolutionary at that time. But there was a limitation to this solution, it could
not be sold thru a reseller, it was a kind of consultancy.
In 2003 / 04, Enjay Thin Client card was released. The Model was scalable. At that time
Thin Client was very new concept, and acceptance was very low. But slowly business
grew, and Enjay became to be known as Thin Client "Card Wala". By end of 2009, Enjay
had dealers across India. The Team size grew from 4 to 13.
In 2009/10, Enjay started R & D on Telephony & CRM, which were then launched in
2011 / 12, and by 2013 - that solution became very unique and useful. Enjay also
launched Storage Solutions & employee monitoring. These solutions positioned Enjay as
a preferred solution provider for Small Businesses. The team size grew from 14 to 70.
In all these years, two things did not change, and that was Enovation & love for Open
Source. That is the reason all the solutions by Enjay are based on Open Source only,
almost all of them are very innovative.
ENJAY JOBS
41

Innovate
Bring out the genius in you, amaze yourself, surprise the world. At Enjay, ennovation comes
from every team, every department, every individual.
Delight
Enovation comes @ Enjay from each and every corner. We believe in creating user
experience which will delight our users.
Grow
Working in a startup has its own advantages - you get unimaginable opportunity to grow to
unimaginable levels in unimaginable time - just no limits.
42

Software and hardware engineering
If your passion is software programming or Hardware engineering - then this is right place.
@ Enjay we work on many cutting edge technologies.
Technical Support
Support is lifeline of Enjay, if solving problems with innovation excites you. If you are happy
to help and that well deserve thank you - then you fit in here.
Marketing and Pre-Sales experts
43

Need to visualize the solutions out of sheer technology, and how technology can be used to
make this world a better place. Apply technology to business problems
Administration and Finance
Enjay has almost paperless environment - We use ERP, CRM & Google Apps to manage
Enjay. Management is an ART and technology is Science. We need people who can combine
these both very well.
Graduate Interns
What better way to kick starts your career with the innovative environment that Enjay
Offers? We also offer projects and industrial internship for MCA, B.tech, M.tech, BE & ME
students.
SWOT Analysis
44

Strength
1. Enjay has been building a full set of SAP life cycle services, from
consulting to implementation, managed services, BPO and hosting,
while depending its technical and functional capability.
2. Increasing focus on domain-led solutions has led to investments in
process maps, data models and solutions for numerous industries,
including manufacturing, retail and CPG, life sciences, banking and
insurance, travel and transportation, telecom, media and entertainment,
and energy and utilities, as well as solutions in areas that are not
currently addressed by SAP, such as dealer management and legal
management solutions.
3. Clients cite enjay commitment to delivery excellence, flexibility to
changing requirements, great teamwork and technical expertise as key
strength.
4. Enjay has large client base (936 clients) and balanced geographical
revenue base with the lowest reliance on North America amongst top tier
IT companies.
5. Man power strength is less in enjay thus, it help to developed
personalized career.
Weakness
1. Fuelling the rapid growth has resulted in Enjay relying more on junior,
albeit well-trained, resources, which has given rise to client’s perception
of inconsistent quality of consultants, skills mismatch and resource ramp-
up delays.
2. Although making strides, Enjay still needs to improve its consulting
capabilities and process depth to be truly a business and not solely a
technology partner.
3. Clients indicate that Enjay could improve on its project management,
communication and user change management skills areas that Enjay is
actively working on to improve.
45

Opportunitie
s
1. Continuing investments in technology by its clientele, a growing
preference for global sourcing and the emergence of newer technologies
and business models offer many opportunities for Enjay, its integrated
full services capability global delivery footprint and scale have expanded
its addressable market, strengthened its reputation and ensured its
inclusion in the top tier list of vendors invited for the largest and most
complex bids. These offer a sizable growth opportunity for Enjay.
2. Evolution of non-liner delivery models which could positively impact
margins, superior platform offering (diligenta, citigroup global services)
nearing maturity which could expand the scope for cross selling.
Threats
1. Industry wide supply side pressures leading to attrition, wage inflation
and eroding margins.
2. Innovation product/services of competitors.
3. New competitors entering the market.
4. Economic slowdown in the key markets and potential anti offshoring
legislation.
46

PORTER’S FIVE FORCES MODEL FOR INDIAN IT SECTOR
a). Existing competition:
The IT Industry landscape is characterised by intense completion for conventional IT
services: Application Development & Maintenance, IT Infrastructure Management Services,
Network Management Services, and Data-center Services etc. leading therefore to
commoditization. There are several firms in the market offering similar services and it is
difficult to differentiate based on these service offerings. The existing competition comes
from both domestic players (Infosys, TCS, Wipro, HCL technologies, Tech Mahindra,
Mindtree and so forth) and international ones (IBM, Accenture, Capgemini, Cognizant and
so forth).
47

It is in the context of non-conventional services, i.e. the ones focussed (Digitization et al) on
emerging technologies and trends such as Analytics, Cloud computing, Social Media,
Enterprise Mobility, Internet of Things etc. where the opportunity for differentiation
through niche-specialization occurs. Another argument might be for industry-vertical
specialization but the major buyers (in terms of Industries) for instance Banking & Financial
Services (BFSI), Manufacturing, Energy & Utilities etc. are well catered to and it would be
easier to think of IT companies as portfolios of verticals (across clients) especially when
considering growth potential (with the growth in an industry benefiting the IT service
provider that draws most revenues from the industry in question). Vertical specialization
therefore will only be beneficial for industries going through rapid change (Telecom for
instance) or through rapid growth caused by external factors like government regulation.
The healthcare industry is a major example and thing bode well for it both in developing
markets (due to non-linear permeation to affect broader access) as well as developed ones
(based on the ageing demographics).
b). Bargaining power of customers:
For conventional IT services, bargaining power of the buyer is large and the possibility of
pressure on rates exists. The buyer, having worked with both with international IT providers
as well as Indian ones is largely the price setter and has negated (to a large extent) the
offshore advantages through mature procurement and global delivery. The international IT
firms too have negated the advantage enjoyed by Indian IT companies through captive
centres in India and globally. In this industry, in case of conventional IT services, the buyer is
king!
In case of non-conventional services, i.e. those that cater to emergent technologies and
technology trends (in Data Analytics or Enterprise Mobility for instance) there is potential
for differentiation and higher margins. Also this is the case for non-conventional,
partnership-style engagements where both risk and rewards are higher.
48

The bargaining power for suppliers is very low and since high-standardization exists, there is
little scope of suppliers having any clout. The suppliers consists of IT Infrastructure providers
(Servers, computers etc.), Recruitment firms, Office Space Suppliers etc.
In context of the highly commoditized IT services, there is little threat of new entrants. That
said, the Industry is also characterised by high people dependence and therefore can see
veterans detach from existing companies to invest in new ventures. An example of this is
Happiest Minds, which was started by a co-founder of an existing IT provider. The newer
technologies allow the possibility of new niche players that are not dependant on size or
experience constraints.
e). Availability of Substitutes:
There are no substantial substitutes to IT services apart from Internal IT departments, which
have lost clout over the years and are ever thinner in numbers and significance. One
argument for internal IT is retaining control over pertinent aspects of business but the
argument against would be since , it should outsource as much as possible and focus on
future growth in core areas. Over time there has been a steady decrease in in-house IT
development and maintenance with more and more being outsourced and the internal IT
staff has settled into a supervisory (program management) role. This has been a mixed bag
for newer services as well since internal specialization is very low, most of the work is
outsourced. For critical areas, governance has been retained in-house and this trend seems
to have found favour with most large enterprises worldwide.
Broadly speaking the market for conventional services is highly commoditised with potential
for differentiation concentrated around niche expertise in new technologies and trends
(SMAC + Internet of Things) and around non-conventional engagements (revenue/profit
49

share, risk-reward models). It is unlikely that the market for conventional services will vanish
overnight but the future promises to hold a highly modified view.
50

PORTER’S FIVE FORCE MODEL FOR VIETNAM IT SECTOR
a). Existing Competition:
One of the problems in the IT environment in Vietnam is the government’s habit of enacting
laws over the top of existing ones. This leads to uncertainty over which rule apply, even
outright conflicts. A new unfair competition regulation issued in July illustrates this problem.
Decree 71 was issued to set out remedies for unfair competition violations. However a
2013Decree 99 already covers sanctions for IP violations including unfair competition. The
first problem is the bodies who deal with unfair competition. Decree 71 says it is the
Competition Authority at the Ministry of Trade and Industry. Whereas Decree 99 permits a
variety of bodies, who normally handle IP cases. Secondly the procedures specified differ,
with Decree 71 laying down specific new procedures, while Decree 99 adopts pre-existing
ones. A third point is different levels of fines are imposed. For example one offence of
passing off has a fine of 200 mn VND in Decree 71 and 500 mn VND in Decree 99. There are
increased fines for cyber squatting, trade secret theft and so on, which is good news, but
only if you use the new Decree! The general rule is that the later decree should apply, if it is
unclear which should be used. This potentially takes a wide range of IP related unfair
competition violations out of the hands of existing IP authorities and off to a new
department. It is not at all certain that this was intended; authorities are often protective
and try to retain jurisdiction so we fully expect the existing authorities to continue to hear
cases. We will only know how this will pan out once the decrees start to conflict and
decisions get made. It is quite common for parallel jurisdictions to run for years.
b). Bargaining Power of Buyers: Porter’s Five Forces Analysis:
The presence of powerful buyers reduces the profit potential in an industry. Buyers increase
competition within an industry by forcing down prices, bargaining for improved quality or
more services, and playing competitors against each other. The result is diminished industry
profitability. The bargaining power of buyers comprises one of Porter’s five forces that
51

determine the intensity of in an industry. The others are barriers to entry, industry rivalry ,
the threat of substitutes and the bargaining power of suppliers .
The power of an industry’s important buyer groups depends upon:
Characteristics related to its market situation the relative importance of its purchases from
the industry as compared with its overall business. How to assess the power of a buyer
group .The following conditions indicate that a buyer
Group is powerful:
The buyer group is concentrated, or purchases large volumes relative to the seller’s sales
Products purchased from the industry represent a significant percentage of the buyer’s
costs or purchases Products purchased from the industry are standard or undifferentiated—
alternative suppliers are easy to find and competitors are played against each other Few
switching costs exist (little penalty for moving to another supplier) Profits earned are low
(greater incentive to reduce purchasing costs)
Buyers pose a significant threat of backward integration—buyers demand concessions, and
may engage in tapered integration (producing some components in-house and purchasing
the rest from outside suppliers) The industry’s product is not important to the quality of the
buyer’s products or Services The buyer has full information (their knowledge of demand,
market prices and supplier costs provides them with leverage.
The second force is the bargaining power of suppliers (Porter, 1990). All companies that
manufacture goods need to obtain raw materials from external parties or suppliers. Hence,
it is imperative that companies establish good relationships with their suppliers so as to get
favorable prices and a steady supply of raw material. Yet, the supplier-manufacturer
relationship is rarely one of equals (Griffin, 2001). Normally, one party has the upper hand.
Suppliers have greater bargaining power if there are few of them so they can dictate terms
to the customers who are at their mercy (David, 2009). Bargaining Power of Suppliers
Information Technology this report serves a number of major purposes. First of all, it seeks
52

to understand the development of Information Systems IS/ Information Technology IT
theory. Secondly, it narrows the scope to enterprise value chain to evaluate the current
practice in this area. Finally, it seeks to evaluate and analyze the future of the companies
studied in relation to IS/ IT.
The third force is the threat of new entrant (Porter, 1990). New entrants to a market can
seriously affect the market share of existing members and this is a constant source of
anxiety for companies. In an ideal free market system, a company can enter and exit a
market with the greatest ease and that profits will be nominal. However, in the real world,
there are numerous barriers to entry, some of which are the result of economics, while
others are the outcome of government intervention (Rugman and Hodgetts, 1995).
• Strong brand names are important (Technology Industry)
• Advanced technologies are required (Technology Industry)
• Patents limit new competition (Technology Industry)
• Customers are loyal to existing brands (Technology Industry)
• High switching costs for customers (Technology Industry)
• Entry barriers are high (Technology Industry)
e). Threat of Substitutes:
The fourth is the threat of substitutes, which refers to products in other industries (Porter,
1990). If the costs of the products in a particular industry are too high, customers might
switch to products in other industries. Price is not the only variable but changes in
technology have the potential to make users flock to rivals (David, 2009).
• Substitute has lower performance (Technology Industry)
• Substitute is lower quality (Technology Industry)
53

• Substitute product is inferior (Technology Industry)
• High cost of switching to substitutes (Technology Industry)
• Bargaining Power of Customers
• Product is important to customer (Technology Industry)
• Large number of customers (Technology Industry)
• Limited buyer choice (Technology Industry)
54

BUSINESS PLAN
Market Analysis : 4P’s
This business plan for Enjay I.T Solution is exclusive in its succinct display of major
guidelines to success. Combining the business plan with specialized and appropriate focal
points with uniformly significant aims provides a precise display of the firm's objectives and
a powerful concept on the course of business. The plan also helps in triggering the sales of
its product by distinguishing it from the opposition. By expanding their business to Vietnam
they can achieve the following goals
Business plan for Enjay I.T Solution - Objectives
 To propose and expand company's software commodity in an expeditious manner.
 To promote the company's software to skilled investors in the demographic area and
then internationally.
56

 To trigger the sales of the company from an amount to the desired amount in an
estimated period.
Product in the Business Plan
The first thing a company need, if a company want to start a business, is a product.
Therefore Product is also the first variable in the marketing mix. Product decisions are the
first decisions you need to take before making any marketing plan. A product can be divided
into three parts. The core product, the augmented product and the tertiary product. Before
deciding on the product component there are some questions which need to ask yourself.
• What product are you selling?
• What would be the quality of your product?
• Which features are different from the market?
• What is the USP of the product?
• Whether the product will be branded as sub brand or completely new?
• What are the secondary products which can be sold along with primary (Warranty,
services)
Based on these questions, several product decisions have to be made. These product
decisions will in turn affect the other variables of the marketing mix
Enjay I.T Solution Limited is an IT services, business solutions and outsourcing organization
that delivers real results to global businesses, ensuring a level of certainty no other firm can
match.
Enjey Solutions can offers following products and services in Vietnam
• Tiguin OS
Linux on Desktop has always been a dream, with huge FUD around it. Not any more.
With Tally, SAP, office, Email, Internet Browser and many other software on Linux.
Now Linux on Desktop is Possible.
57

• Thin Clients
Enjay Thin Client solution, powered by Enjay Tornado OS, is right blend of hardware
and software which offers affordable yet powerful computing for SMB, Easy to
integrate with Windows or Linux Environment.
• Storage Solutions
EnjayStoreVol NAS offers RAID 1,5,6,10 to protect your data and keep your business
running. With builtin Backup tool and Disaster Recovery solutions.
• Enjay CRM
Hosted CRM, based on SugarCRM. Fully customised for Indian Small Businesses.
Complete Sales / Support lifecycle management. Lots of add-ons and integrations
available.
• Enjay Synapse
Enjay Synapse is a solution with support for IVRS, CTI (computer telephony
integration), voice logger, call recording and detail reporting very useful for
telemarketing, telesupport and Call Center.
• EnjayEnsight
Capture video and screen of your employees computers and get report of
application usage from EnjayEnsight PC Activity Monitoring software.
Place in the Business Plan
Place refers to the distribution channel of a product. If a product is a consumer product, it
needs to be available as far and wide as possible. If the product is a business product, you
58

need a team who interacts with businesses and makes the product available to them. Thus
the place where the product is distributed depends on the product and pricing decisions, as
well as any STP decisions taken by a firm.
Company Locations and Facilities
The Company has to initialyestablish a dedicated office room in Hanoi in Vietnam Country.
In Hanoi, there is a relatively short history of incubators already including especially Vat
Gia’s incubation space. But coming soon there will be many more including the Silicon Valley
project. Hanoi has long been the power center, where the government rules. It’s also a
significant startup scene in its own right. That’s why we prefer Hanoi to start business
Enjey Solutions in presentGeographically located in Bhilad, Gujarat.thecompany has clients
from different states of India as well as other foreign countries.North America and Europe
constituting the largest markets for services. Through improvements in logistics and
infrastructure, Enjey Solutions has been making great inroads in its manufacturing and
distribution policies. In India, the company has made investments in the SSO (Support
Service Organization), PSO (Professional Services Organization).with the help of both SSO
and PSO has been able to provide complete solutions. This has strengthened the company’s
capabilities in backing the installation types that ranges from large to single orders for multi-
locations.
Enjay Solutions expands its operations in Mumbai. Starting Mumbai branch as a strategic
move to expand into Western region and as a first step to expand to entire India.
EnjaySolutions , the developers of various innovative Business solutions like Enjay CRM,
Telephony, Tiguin Linux OS, employee monitoring software, Thin Clients, & storage. Enjay
has been into this field for last 17 years, with very well matured solutions and experienced
team behind it.
Company already have been working very closely with many partners in Mumbai. Company
also have more than 700 of customers using our solutions only in Mumbai. Having a local
presence in city like Mumbai will help us provide better service and explore new business
opportunities for them and their partners.
59

Price in the Business Plan
Pricing of a product depends on a lot of different variables and hence it is constantly
updated. Major consideration in pricing is the costing of the product, the advertising and
marketing expenses, any price fluctuations in the market, distribution costs etc. Many of
these factors can change separately. Thus the pricing has to be such that it can bear the
brunt of changes for a certain period of time. However, if all these variables change, then
the pricing of a product has to be increased and decreased accordingly.
Enjey Solutions has a management information structure in place that gathers the product
prices of its competitors and then after careful analyzing makes its own pricing policies that
are somewhat parallel to the competitors prices. The main objective of EnjeySolutionsis to
provide services rather than running after the revenues hence, the company has kept a
reasonable pricing policy for most of its products and services.
It is happy to gain minimum profit margins in order to get a competitive advantage over its
adversaries. EnjeySolutionsis a firm believer in spreading its network in every nook and
corner and generating more volumes. The company realizes more the volume revenues will
come automatically, therefore it has kept pricing policies consumer friendly to garner
wealth maximization instead of profit maximization.
Price Chart of Major Products and Services for Vietnam market
Product&Services Customizability Price Range
Tiguin OS Yes 20000-50000
Thin Clients Yes 100000-120000
Storage Solutions Yes 75000-100000
Enjay CRM Yes 50000-150000
Enjay Synapse Yes 10000-20000
EnjayEnsight Yes 10000-20000
60

Promotion in the Business Plan
Enjey Solutions is not gives prime importance to its advertisement and promotional
strategies. Company has a good image among the client and it spreads through clients to
clients.The company’s favorite form of advertisement is using the online media and
internet, although the a multi-media campaign to create awareness amongst the consumers
about the various products and services it provides. In Vietnam also company can follow the
same promotional methods to attract the clients.
 The promotion budget can be 15% of sales.
Promotions in the marketing mix includes the complete integrated marketing
communications which in turn includes ATL and BTL advertising as well as sales promotions.
Promotions are dependent a lot on the product and pricing decision. What is the budget for
marketing and advertising? What stage is the product in? If the product is completely new in
the market, it needs brand / product awareness promotions, whereas if the product is
already existing then it will need brand recall promotions.
Under the company’s sales promotion policies, Enjey Solutions provides special offers to
corporate houses, institutions and end-users. It has also started various policies under which
some of the Enjey Solutions product could be purchased through EMI. It has joined the “Go
Green” movement. Under this TCS has developed a GreenEdge framework that will cater to
the needs and wants of manufacturing industry.
61

Advantage of investment in Vietnam – why invest?
 Strategic location
The location of Vietnam provides it a lot of trade benefits. It situated in the center of
southeast Asia. One of the major components to attract foreign investors is Vietnam's is that
its ability to enter Southeast Asia's other major and developing markets. It is proved that it
is a potentially a good trading partner for this countries because of its close proximity to
China and most other Association of South East Asian Nations (ASEAN) countries.
 Favorable investment climate
Since the past 3 decades, Vietnam has become as one of the most attractive places for
foreign investors. To achieve cost-effectiveness in their global supply chains investors have
been consider Vietnam as a major strategic investment location. Tax benefits for
investments in Preferential Investment Sectors, transparent investment environment,
liberalized economic structure, investor friendly legal and regulatory environment with well-
established legal and regulatory frameworks including the Labor Code, Land Law, Law on
Competition, Civil Code, Law on Securities, Enterprise Law and Investment Law, low cost
labor, favorable Foreign Direct Investment policy, clearly defined these are the some of the
investment sectors for Vietnam and user friendly Banking and Foreign Exchange Norms and
clearly defined Licensing process for foreign investors investing in Vietnam for the first time.
To increase the investments in Vietnam the inclusion of Vietnam as a member of the World
Trade Organization (WTO) shall also act as a catalyst to bring about opportunities for the
economic development of Vietnam.
 Increasing Exports
62

Because it is highlighted by its high import and export volumes Vietnam has been one of the
most open economies in international trade. It has applied trade in very orderly manner as
liberalisation, some sectors of the economy to international markets a two-track approach
has opening while protecting others.
Major export from Vietnam is crude oil. It is a major exporter of agricultural commodities
such as rice, coffee, tea and rubber and also a export of services such in tourism, mining and
high-technology sectors has been growing at a reasonable pace.
Vietnam is now also considered as a major source of the world's manufactured goods,
especially garments, textiles and footwear. Favorable import duty regime for import of
certain goods under certain categories. It has been adopted a favorable import duty regime
with import duty exemptions available. They are three categories such as
 Ordinary
 Preferential and
 Extra-preferential
Import duty at rates goods entering Vietnam Based on the trading relationship between
Vietnam and the exporting country. Components and materials imported for manufacturing
goods for export are exempted from import duty provided and these goods are exported
within 275 days. Other than this investments in encouraged investment projects, like
infrastructure development projects are eligible to import duty exemptions for a time of 5
years from the date of start of operation for importing raw materials, supplies and
accessories which cannot yet be domestically produced.
 Demographic Advantage
Highly literate Young, hard-working, and easy-to-train labor force is one of the major
advantages of Vietnam as an investment destination . From the total population of Vietnam,
about 60% is below the age of 25 years. The literacy rate for the population aged 15 years
and above is approximately 94%. This is the result of the importance and priority given by
the Government of Vietnam to the development of quality training and education system in
63

Vietnam. In every year in Vietnam on an average About 1.5 million people have been added
to the labor force, over the past decade. Professionals making a part of the labor force
speak, read and write English as well as other relevant foreign languages at workplaces. The
biggest advantage to appropriate training conducted by professional experts for employees
is the low-cost labor force.
 Double Tax Avoidance Agreements (DTAs)
Vietnam has already entered into DTAs with more than 50 countries at various stages of
implementation and negotiation,. The following are the countries with which Vietnam has
signed DTAs.
Countries with which Vietnam has signed DTA agreements
Australia Hungary China Switzerland Taipei
France Poland Romani Mongolia Algeria
Thailand Netherlands Malaysia Bulgaria Myanmar
Sweden Denmark Laos Italy Finland
South Korea Norway Belgium Belarus Philippines
UK Japan Luxembourg Czech Republic Saudi Arabia
Singapore Germany Uzbekistan Canada Iceland
India Russia Ukraine Indonesia Korea Republic
A foreign tax credit is available to resident tax payers in respect of foreign taxes paid for
those country that has a DTA with Vietnam, Vietnamese Corporate Income Tax attributable
to foreign income or the amount of credit given is the lower of the tax suffered in the
foreign country.
 Tax incentives
The generally applicable Corporate Income Tax (CIT) in Vietnam is 25%. However, core
Sectors like health, education, high-tech, infrastructure development and software and
encouraged special economic zones or areas with difficult socio-economic conditions
preferential tax treatment including tax exemption, tax reduction and preferential tax rates
(10% and 20%) is available for investments. As a part of the preferential tax treatment,
investments in encouraged sectors projects attract a corporate income tax exemption for
64

first four years of operations, income tax at 50% of the preferential rate of income tax rate
for the nine subsequent years, income tax at preferential tax rate for the subsequent two
years and the corporate income tax at the usual rate of 25% thereafter. Also, as a part of the
preferential corporate income tax regime, losses are allowed to be carried forward for a
period of 5 years.
 Political stability
Vietnam's political and social stability make it one of the safest investment destinations in
Southeast Asia. Vietnam is a single-party socialist state with a high degree of ethnic,
linguistic, and religious homogeneity. Only political organizations affiliated with the
Communist Party are permitted to contest elections in Vietnam, this aids the government to
maintain political stability, promoting Vietnam as an investment avenue and ensuring
economic development.
65

How to invest successful in Vietnam
Vietnam is a new and emerging market which is offering many opportunities to Investors.
However, being successful in doing business in Vietnam is not easy if you do not understand
market well enough.
• Promote brand awareness and corporate image worldwide
Vietnamese often prefer famous brand to non-famous one. Almost successful foreign
investors in Vietnam have owned very strong brand name in other countries. Starbuck; KFC;
Canon; Samsung are the typical examples.
• Understand customer needs and Respond proactively
Vietnam is standing out to be a very large and potential market with reaching 100 million
people. However, don’t ever think that is easy market. Vietnamese customers are different
from other market. They have different interest, shopping habit or even different payment
method. So, to persuade customer, you have to respond proactively to adapt with local
customer and market.
• Make a difference to your products and services
Difference makes success. If you want to compete and win others, you shall be go ahead
them with creating typical and unique products and services. That is the best way to stand
out from the competitions.
• Develop and Extend network business alliance
Network is the key important in the mutual and globalized market. More networks you
have, more success you get. In addition, there are some others key advices which you need
to consider before decide to concentrate into Vietnamese market such as:management with
in-depth information; overview of the main goals; and social responsibility and protection
environment.
66

REQUIRED DOCUMENTS TO SET-UP SOFTWARE COMPANY IN
VIETNAM
The establishment of a Foreign Invested Company (Hereinafter referred to as “FIC”) in
Vietnam requires an Investment Certificate and a Certificate of Business Registration from
the licensing authority. Depending upon the location of the company, the licensing authority
may be the Provincial People’s Committee (for companies located outside industrial or
export processing zones) or the provincial Industrial and Export Processing Zones
Management Authority (for companies located in industrial or export processing zones).
The roadmap for the incorporation of the FIC for producing software can be described in
following steps as follows:
•Preparing the application dossier:
We shall collect necessary information and documents from you. Upon receipt of necessary
information and documents from you, we shall translate documents from English into
Vietnamese and prepare the application dossier under the standard forms. The initial
drafted application dossier shall be sent to you for your comments. Then, after updating the
application dossier based on your comments, we shall obtain the preliminary comments
from the competent authority and send the finalized application dossiers for you to sign and
seal. We anticipate that this phase shall be completed within 05-07 working days. The
prepared documents shall then be sent to you for review, signing and seal.
•Submission of application dossier for obtaining Investment Certificate:
Within 02working days from receipt of duly signed and sealed application dossier, we shall
submit the application dossier to the competent authority. It shall take about 20 working
days from submission of application dossier to the competent authority for the provincial
licensing authority to grant the Investment Certificate.
67

•Submission of application dossier for obtaining Certificate of Business
Registration:
Within 02 working days from receipt of Investment Certificate, we shall submit the
application dossier to the competent authority for obtaining Certificate of Business
Registration. It shall take about 07 working days to complete.
•Post licensing:
Within 13 working days we shall complete the post licensing procedure such as publishing
the FIC in National Database of Enterprise Registration, obtaining sea land tax code
registration.
68

MODES OF ENTRY
To find the way of how to enter a foreign market can have a significant impact on the
results. Expansion into foreign markets can be achieved through the following four
mechanisms:
e) Exporting
f) Licensing
g) Joint Venture
h) Direct Investment
e) Exporting:
Exporting is a traditional and well-established method of reaching foreign markets.
Exporting is the marketing and direct sale of domestically-produced goods in another
country. Under this it is not compulsory that the goods be produced in the target country,
no investment in foreign production facilities is required. Most of the costs associated with
exporting are considered as a marketing expenses.
Exporting commonly requires coordination among four players:
 Exporter
 Importer
 Government
 Transport provider
f) Licensing:
Licensing permits a company to enter into the target country to use the property of the
licensor. Such property usually is intangible, like trademarks, patents, and production
69

techniques. For the exchange for the rights to use the intangible property and possibly for
technical assistance, licensee pays a fee for the same.
Licensing has the potential to provide a very large ROI because little investment on the part
of the licensor is required, However, because the licensee produces and markets the
product, potential returns from manufacturing and marketing activities may be lost.
g) Joint Venture:
There are five common reasons for why company go for a joint venture: market entry,
risk/reward sharing, technology sharing and joint product development, and conforming to
government regulations. Other benefits include political connections and distribution
channel access that may depend on relationships.
Such alliances often are favorable when:
 The partners' strategic goals converge while their competitive goals
diverge;
 The partners' size, market power, and resources are small compared to
the industry leaders.
 Partners are able to learn from one another while limiting access to their
own proprietary skills.
In a joint venture ownership, control, length of agreement, pricing, technology transfer,
local firm capabilities , resources, and government intentions are considered as key issues.
h) Foreign Direct Investment:
Direct foreign investment had to form through the attainment of an existing entity or the
establishment of a new enterprise. However, it requires a high level of resources and a high
degree of commitment. Foreign direct investment (FDI) has the direct ownership of facilities
in the target country. Direct ownership provides to high degree of control to the operations
and the ability for the better knows the consumers and competitive environment. They
involves the source of transfer to the resources including capital, technology, and personnel.
70

FORMS OF INVESTMENT IN VIETNAM
According to the Vietnam Law on Investment (2005), foreign investors can invest in
Vietnam through direct investment and indirect investment.When foreign investors
require to set up their business in Vietnam need to be advised by a law firm in Vietnam
on forms of investment
Direct investment Indirect investment
The direct investment is when such the
investor invests its invested capital and
also makes an active participation in the
management of the investment
activities, includes:
 To invest in business
development.
 To purchase shares or to
contribute capital in accordingly
to participate in management of
investment activities.
 To found economic organizations
in the form of one hundred per
cent (100%) capital of domestic
investors or one hundred per
cent (100%) capital of foreign
investors.
Indirect investment means a form of
investment whereby the stockholder do
only donate the wealth but do not
actively participate in the management
of the investment activity includes:
 Through other midway financial
institutions.
 Buying of shareholding, shares,
bonds and other valued papers;
 Through securities investment
reserves;
71

 To start other forms of direct
investment.
 To establish joint venture
economic organizations between
domestic and foreign investors.
 To invest in the contractual forms
of: BCC, BO, BTO, and BT.
 To invest for carrying out of a
merger and acquisition of an
enterprise.
.
The direct investment is when such the investor invests its invested capital and also
makes an active participation in the management of the investment activities, includes:
 To invest in business development.
 To purchase shares or to contribute capital in accordingly to participate in
management of investment activities.
 To found economic organizations in the form of one hundred per cent (100%)
capital of domestic investors or one hundred per cent (100%) capital of foreign
investors.
 To start other forms of direct investment.
 To establish joint venture economic organizations between domestic and foreign
investors.
 To invest in the contractual forms of: BCC, BO, BTO, and BT.
72

 To invest for carrying out of a merger and acquisition of an enterprise.
73

TYPES OF ENTERPRISE FOR FOREIGN INVESTORS TO INVEST IN
VIETNAM
a) Limited Liability Company In Vietnam following category of company
exist under the LOE:
• Limited liability company with one member (one-member LLC)
• Limited liability company with more than one members (LLC)
An LLC is a legal company organized by its members by way of capital shared to the LLC. The
capital contribution is treated as equally for each members. The members of an LLC are
legally responsible for the debts of the LLC to the improvement of their capital shared - or
undertaken to be shared - to the LLC. An LLC initiated by one or more foreign investors may
take the form of either a 100% Foreign Owned Enterprise (FOE) where all members are
foreign investors or of a foreign-invested joint-venture company between one or more
foreign investors and one or more domestic investors.
b) Joint Stock Company:
Under the Enterprise Law, a JSC is a company whose officially written capital is divided into
shares held by three or more organizations or persons. A JSC is a recognized legal company
under Vietnamese law and partners are liable for the financial obligations and
responsibilities of the company to the improvement of the amount of their shared capital. A
JSC has the right to provide securities to increase capital and it may noted on the Securities
Exchange. The establishing partners of a JSC must pay at least 20% of the total number of
common shares that the JSC is permitted to offer for sale. The JSC must have common
shares and may have preferred shares and/or issue bonds. Partners in JSCs may be
Vietnamese or foreign. A common partner has the right, among other things:
• To attend the General partners Meeting;
74

• To vote in a number that correlate to his/her/its amount of shares;
• To get dividends, to transfer his/her/its shares as specified under the Enterprise Law;
and
• To give priority in buying new shares offered for sale.
c) Partnership:
Partnership is that two or more people being co-owners of the company and jointly doing
business under a common name.
A Partnership Company is a form of business established by at least two general partners
and may also have limited partners. General partners are legally responsible for all duties of
the Partnership Company with their own possession, while limited partners are only
responsible for the improvement of their capital contribution. Nowadays in Vietnam the
Partnership Companies have not been a common vehicle for foreign investment.
d) Private enterprise
A private enterprise is belonged to one person who is legally responsible to paying the cost
for all activities of the company to the improvement of his/her profit. An individual only
setup one private company. So that it may not have any type of security.
e) Joint venture
Basically, the foreign investor and its Vietnamese partner combinely apply to setup a
company. The investor has two ways to make a joint venture: (i) create a new initiative or
(ii) participate in an existing initiative through the buying of the company’s shares. A joint
venture setup as a limited legal responsible company with more than one member, as a
joint stock company or as a partnership on the basis of a joint venture contract.
f) Representative Office of foreign trader:
75

As an alternative to settingup or investing in a Vietnamese initiative, certain foreign
companies may set up a branch or a representative office in Vietnam,in which both cases
there should be license by the relevant authorities.
A representative office setup by any foreign business company to look for and to develop
business opportunities for the foreign parent. Many foreign investors are ready to setup
their representative offices in Vietnam before deciding to invest, in order to examine the
local market. As the name suggests, a representative office is a dependent unit of the
foreign company, not an independent unit.
A representative office is only allowed to engage in business development and related
activities and cannot manage profit producing activities. (i.e: the direct payment or receipt
of funds, sale or purchase of goods, or provision of services), but the representative Office is
permitted to
 To work in a particular way with the purposes, scope and duration which are stated
in the license;
 To purchase the equipment and facilities for the working of the Representative
Office;
 To recruit Vietnamese and foreign workers by their law of Vietnam in order to work
for the Representative Office;
 To open accounts in foreign money and to use such accounts only for the working of
the Representative Office.
g) Branch of foreign trader:
A branch office can be a subunit of a foreign company and may undertake commercial activities for
direct business purposes in connection with international parties to which Vietnam is a trading
partner. In Vietnam banks, tobacco companies, airlines, law firms, and foreign companies producing
an effect in the fields of culture, education and tourism are permitted to setup branches. Foreign
companies may also setup branches in Vietnam to manage business activities and activities directly
related to business of goods.
76

India’s Import & Export Policy: Procedures and Duties
Import Procedure:
Goods bought from foreign countries are referred as Import trading. The trading methods
adopted by each country differs in various aspects including their policy, legal requirements
and custom policies. The government of the country is responsible for controlling the import
trade. The basis of the government controls is to keep an eye on legal use of foreign
exchange restrictions, safety of native industries, etc. The import trading procedure have to
take into account all the steps given by the government. Below are the various steps
involved in import procedure:
a. Trade Analysis: The first step involved in import trading is investigation in regards to
price and terms on which the exporter will be supplying merchandise. The details
such as merchandise requirements, description, size, weight, quantity, and item
number/grade should be mentioned in the analysis report. In addition, the method
and time of delivery, packing terms and conditions in regards to remittance should
also be mentioned. This inquiry is a first formal request sent by the purchaser. In
return, the purchaser receives the quote from the seller and the quotation includes
the requested information by the purchaser.
b. Acquisition of Import License and Quota: The import trade of India in controlled
under the Imports and Exports Act since 1947. An individual or a business cannot
import merchandise without a valid import license, no matter what the category of
the license is.
The general license allows to import merchandise from any country while other type
of specific/individual license only allows to import from specific countries. The
government of India maintains its import policy under Import Trade Control Policy
Book also knows as Red Book. Imported must go through the Red Book to check out
the limitations/class of merchandise that can be imported in a given period of time.
78

Global country study report 2015 16

Global country study report 2015 16

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