Export ARMY Coffee

TABLE OF CONTENTS
ACRONYMS LIST ...................................................................................... III

TABLE LIST ................................................................................................ IV
DIAGRAM LIST .......................................................................................... V
CHART LIST ................................................................................................ V
INTRODUCTION ........................................................................................... 1
CHAPTER1: INTRODUCTION ................................................................... 3
1.1 INTRODUCE ABOUT THE COMPANY ........................................................... 3

1.1.1 General introduction of the company .............................................. 3
1.1.2 History and development ................................................................. 3
1.1.3 Business field of the compnay ......................................................... 4
1.1.4 Business scope ................................................................................. 5
1.1.5 Main marketing ................................................................................ 5
1.1.6 Organizational structure of the company ......................................... 5
1.1.7 Production and business results ....................................................... 8
1.1.8 Development strategy and investment ........................................... 10
1.1.9 Objectives, mission and the essence of values............................ 10
1.2. PRODUCT SPECIFICATION ....................................................................... 11
1.2.1. Introduce the products ................................................................... 11
1.2.2. Production process ........................................................................ 11
CHAPTER 2: THE EXPORT PLAN .......................................................... 15
2.1 LEGAL BASE FOR EXPORTING. ................................................................. 15

2.2 MARKET BASE FOR EXPORTING............................................................... 15
2.2.1 Market research results .................................................................. 15
2.2.2 The order of business partner ..................................................... 30
2.2.3 Financial analysis ........................................................................... 43
2.3. SELECT TARGET MARKET AND BUSINESS PARTNERS .............................. 47
2.3.1. Select target market ....................................................................... 47
i
2.3.2 Search for business partners ........................................................... 52
2.4 SIGN THE INTERNATIONAL SALE OF GOODS CONTRACT. .......................... 54
2.4.1 Identify the negotiating method ..................................................... 54
2.4.2 Form the contract ........................................................................... 54
2.5 EXPORT ARRANGEMENT. ........................................................................ 60
2.5.1 The process of implementation ...................................................... 60
2.5.2 The steps......................................................................................... 60
CONCLUSION .............................................................................................. 67
REFERENCES .............................................................................................. 68
ii
ACRONYMS LIST
ACB Asia Commercial Joint Stock Bank
ISO International Organization for Standardization
HACCP Hazard Analysis and Critical Control Points
BRC British Retailer Consortium
HSBC Hongkong and Shanghai Banking Corporation
NPD National Purchase Diary
TPP Trans-Pacific Partnership Agreement
EVFTA Economic Vietnam Free Trade Area
FDA Food and Drug Administration
TTR Telegraphic Transfer Reimbursement
iii
TABLE LIST
Number Table name Page
Table 1.1 Revenue of ARMY Coffee Export Company

1 9
Limited from coffee business in 2018
Table 1.2 Export turnover by market of ArmyCoffee
2 9
Company Limited in 2018
3 Table 1.3 Specification of the coffee beans 11
5 Table 2.1 Compare prices of green beans market 17
6 Table 2.2 Compare prices of domestic competitors 18
Table 2.3 Export Turnover of coffee’s company in

7 19
Intimex Group 2017
Table 2.4 Quantity, Consume, Ending stocks on the
8 20
global according to the Season
Table 2.5 Coffee import quantity of the US in 4 years
9 25
2015-2018
Table 2.6 Coffee market share of some countries in the
10 27
US in the first 6 months of 2017
Table 2.7 Estimated cost for export shipments of 1,500
11 44
MT Arabica Coffee and 500 MT Robusta Coffee
12 Table 2.8 Export freight costs 44
13 Table 2.9 Expenses for export of goods 45
14 Table 2.10 Summarize the cost of export shipment 46
iv
15 Table 2.11 Set the price 46
16 Table 2.12 Market Factor Assessment 49-50
DIAGRAM LIST
Number Diagram name Page
Diagram 1.1 Diagram of enterprise organization

1 6
apparatus
2 Diagram 1.2 Production process of the coffee beans 12
3 Diagram 2.1 The process of implementation 60
CHART LIST
Number Chart name Page

Chart 2.1 Coffee market share of some countries in the
1 26
US in the first 6 months of 2017
v
INTRODUCTION
Nowadays, along with the trend of internationalization of the world economy
is the scientific and technological revolution - technology is constantly developing,
causing economic changes of each nation, in all field areas. The trend of
internationalization has posed an objective inevitable issue: each country must open
to the world market and actively participate in international and regional labor
division to develop its economy, avoid lagging behind other countries.
For Vietnam, foreign trade plays an important role in economic development.
Foreign trade activities help broaden the scope of consumption of a country, it allows
a consumer of all goods with more consumption than it can produce and beyond the
limits of production capacity in that country. In other words, foreign trade or import-
export activities not only help to develop the economy, increase revenue in all
aspects but also promote the process of industrialization and modernization of the
country. Foreign trade activities include 2 areas: export and import. In particular,
import is an important activity in foreign trade activities because it helps supplement
the goods that cannot be produced in the each country, or production does not meet
demand. And also to replace goods that domestic production does not benefit by
imports. While export activities are one of the main activities that help countries
integrate and learn from each other, together develop the economy, create a strong
position on the global market.
Our state has been implementing measures to promote economic sectors
towards export, encouraging private sector to expand export to solve jobs and
increase foreign currency income. To help the export operation to be effective, we
must develop a business plan seeing that it is an important step and is the basis for
deciding whether the business should export or not. Currently in our country there
are quite a lot of high-value export products in the national economy such as rice,
crude oil, textiles, footwear, ... especially coffee. Because this is considered a long-
standing traditional product of Vietnam. Vietnam has very favorable conditions for
1
growing and exporting coffee. Vietnam's coffee has gradually developed and
exported to markets such as Germany and America.
The proportion of exports of coffee products is quite large, bringing a high
amount of foreign currency to the national economy, contributing effectively to the
construction of the country's economy. The State and the Ministry of Industry and
Trade have issued policies to encourage export of goods.
The task of this subject is create a plan to export coffee to the US market. Our
lesson is completed under the guidance of Mrs. Bui Thi Thanh Nga and includes the
following main contents:
Chapter 1: Company Introduction.
Chapter 2: The Export Plan.
In the process of doing lessons, although we tried my best, we could not avoid
errors. Therefore, we would like to receive your comments.
Thank you sincerely!
2
CHAPTER1: INTRODUCTION
1.1 Introduce about the company
1.1.1 General introduction of the company
Company name: ARMY Coffee Export Limited Company
International name: ARMY Coffee Export Limited Company
Trading Name: ARMY Coffee Co., Ltd
Legal representative: Dang Dinh Tuan
Position: Director
Type of company: Limited Company
Tax code: 0302817119
Address: No. 8, Long Dinh hamlet, Long Kien commune, Cho Moi district, An
Giang province, Vietnam
Tel: (8423) – 788798 Fax: (8423) – 788799
Email: [email protected]
Website: http://www.armycoffee.vn
Date of license: May 10th, 2015
Operation date: June 1st, 2015
Account number: 12450234000069 – ACB bank An Giang branch
Number of employees: Over 700 people
Certification: ISO 9001: 2008, HACCP, BRC, Kosher
Charter capital: 5,000,000,000 VND
1.1.2 History and development
ARMY Coffee Export Co., Ltd has the precursor of Coffee Planting and
Grinding Facility, established on May 12th, 1998 according to Decision No. 237 /
QD-UB of Cho Moi District People's Committee, based in Long Hoa 1 hamlet, Long
Kien commune, Cho Moi district, An Giang province.
In 2015, due to business development requirements under new conditions, it
was required to expand the business so it dissolved the Coffee Facility and
established ARMY Coffee Private Enterprise under the business license number
3
5202000328 of the Department of Planning An Giang province planning and
investment. Initially, the enterprise merely operated in the field of growing and
grinding coffee. But in this year, the company has carried out the transaction of
buying and selling coffee, exporting entrusted to domestic units such as An Giang
Import-Export Company, Southwestern Company, etc. Also in 2015, the company
has built a coffee processing factory, with a capacity of 4 tons / hour and auxiliary
works with a total value of 2,500,000,000 VND.
In 2016, the company expanded its coffee processing factory with a capacity of
5 tons / hour and auxiliary works with a total value of 3,140,000,000 VND. At the
same time, a 3,000m2 warehouse and auxiliary works were built with a total value
of 1,350,000,000 VND.
In 2017, the Company expanded to build factories, invest in new technology
lines, develop and expand production and establish ARMY Coffee Limited
Company under license No. 1601134440 issued by the Department of Planning and
Investment of An Giang Province May 26th, 2009.
In 2018, the Company received the certificate of eligibility for rice export
business No. 119 / GCN issued by the Ministry of Industry and Trade on October
3rd, 2018.
ARMY Coffee Export Co., Ltd constantly improves technology, improves
production capacity as well as product quality. The company is ambitious to become
one of the leading exporters of the province and able to compete in the domestic and
world markets.
In 2019, ARMY Coffee Export Co., Ltd is currently producing many products
with dominant market share in Vietnam market such as: Coffee Beans. The
company's products have been exported to many countries such as the UK and the
US.
The company is striving to become one of the leading enterprises in the field of
export coffee.
1.1.3 Business field of the company
- Processing and distributing products on coffee for domestic market
4
- Export of coffee products to the US and UK markets.
- The main products:
+ Robusta Coffee Beans grade 1
+ Robusta Coffee Beans grade 2
+ Arabica Coffee Beans grade 1
1.1.4 Business scope
The company's core business is exporting pure coffee beans. In addition, the
company also conducts domestic business of coffee beans.
1.1.5 Main marketing
Domestic market: Most Western provinces, Ho Chi Minh City and some
Northern provinces.
Major export market: USA.
Distribution system: Distributing exports through direct export channels and
entrusting and distributing domestically through shops and agents.
1.1.6 Organizational structure of the company
5
Production
department
Human resources
department
Marketing
department
Financial
Deputy
Director accounting
Director
Sale department
Import-export
department
Product
development
department
Technical
department
(Source: Overview for ARMY Coffee Export Limited Company in 2018)

Diagram 1.1 Diagram of enterprise organization apparatus
The apparatus of ARMY Coffee Export Limited Company is built according to
the director model who has the highest authority, followed by the deputy director
and below is the staff management department.
6
 Director: Mr. Dang Dinh Tuan
- The person with the highest authority in the company.
- Leading and managing all activities of the company.
- Issuing regulations in the company, signing appointment, dismissal or
disciplinary decisions with subordinates.
- Responsible for the law on taxes and mortgage of company assets.
 Deputy Director: Ms. Dang Thi Dung
- Has a position just under the director.
- Help the manager of the lower level, urge the staff to work, take care of the
spiritual life for the employees.
- On behalf of the director signing the decisions arising.
 Departments
 Production department: monitor production activities to ensure that each
shipment is out of the oven in accordance with standards worker management,
inventory management.
 Human resources department:
- In charge of personnel issues, salaries and cultural and cultural activities.
- Advising and consulting the board of directors on the management and
movements of enterprises.
- Build labor recruitment plans, annual salary plans.
- Managing officials, labor and wages according to the regulations of the State
and the company.
- Performing documents, archiving records according to regulations.
 Marketing department: research on supply and demand, market tastes,
advising on the implementation of import and export business according to
the plan, making long-term plans to promote sales effectively.
 Financial and accounting department: calculate the cost, revenue of the
enterprise. Paying salaries for personnel. Post your records on a quarterly
basis, send a losses and profits report to management.
7
 Sales Ddepartment: make a list of the types of raw materials and build an
annual business and production plan for the company.
 Import and export department: has the function of advising the company's
leaders in perform import and export business according to the plan of
delivery, establishment and deployment of delivery and shipment plans,
responsible for import and export activities.
 Product development department:
- Conducting research, experimentation, application of new technologies in
actual production process.
- Research, improve quality, old products, creating new product lines.
 Technical department:
- Organizing, managing and operating electricity, water and waste water
treatment systems.
- Proposing technical solutions and improving existing equipment to serve the
company's production and business activities.
- Implementing items of repair, renovation and new construction.
- Operating, maintaining, repairing, analyzing, evaluate the situation of
maintenance and maintenance of equipment and machinery of the company.
 Workers: workers are divided into production teams, each team performs a
different processing steps.
1.1.7 Production and business results
2018 is a successful year of businesses, when businesses are constantly
researching customer tastes and improving product quality, constantly exploring and
researching domestic and foreign markets, gradually expanding markets and
increase market share. As a result, the company has achieved remarkable results.
+ The quality and quantity of the company's products are increasing and
locating in the market.
+ Signing many export orders to foreign countries.
+ Profits increased.
8
+ The income of workers in the company increased and the quality of workers'
life improved.
Table 1.1 Revenue of ARMY Coffee Export Company Limited from coffee
business in 2018.
Quantity Amount Proportion
Market
( MT) ( VND ) (%)
Export 3,000 182,453,250,000 78.21
Foreign 1,000 50,817,750,000 21.79
Total 4,000 233,270,000,000 100.00
(Source: Financial statements of the company in 2018)
According to data on the proportion of revenue obtained from domestic and
export coffee business, we can see that the revenue from coffee business in export
markets is mainly, accounting for 78.21 %.
Table 1.2 Export turnover by market of ArmyCoffee Company Limited in
2018.
Quantity Amount Proportion
Market
( MT) ( VND ) (%)
US 2,000 133,799,050,000 73.34
UK 1,000 48,654,200,000 26.66
Total 3,000 182,453,250,000 100.00
(Source: Financial statements of the company in 2018)
The US is currently the main export market of the Company (accounting for
73.34% of total export turnover). According to the upcoming orientation, the
company will still boost exports to the US because the potential for exploitation in
this market is huge. At the same time, the company will continue to explore and test
exports in many different markets in the region and around the world.
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1.1.8 Development strategy and investment
The company has developed a sustainable development strategy based on
compliance with laws and governance rules to ensure development safety in all
situations.
In production and business, the company is associated with the orientation:
investment, development and application of modern science and technology
combined with advanced management technology to create optimal products for
society, bring customers the right and effective products with the lowest cost.
Promoting and maximizing the potentials and available resources, when having
the opportunity to continue to expand investment items, developing new industries
or business fields.
Create a solid market share for the company's products, focus on the export of
the Company's products.
Focusing on human factors, considering people as the most valuable asset is a
decisive factor for development.
1.1.9 Objectives and mission
1.1.9.1 Objectives
To become the leading exporter of coffee in Vietnam. Export ARMY Co., ltd
is constantly improving the production process, connecting the supply of raw coffee
products from the garden, creating a sustainable chain to create the best products at
competitive prices most competitive to provide for domestic and international
customers.
1.1.9.2 Mission
Since company established, it has always strived to provide solutions and
technological processes to produce 100% "clean coffee" without mixing any kind of
flavoring, chemicals, other types of beans.
Commit in the near future will reduce the amount of coffee processing waste
water and use solar energy in the production process.
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1.2. Product specification
1.2.1. Introduce the products
Table 1.3 Specification of the coffee beans
Commodity
Specification
Robusta Coffee Robusta Coffee Arabica Coffee
Beans grade 1 Beans grade 2 Beans grade 1
Sieve standard 90% min 90% min 90% min
Moisture 12.5% max 13.0 % max 12,5% max
Foreign matter 0.5% max 1.0 % max 0.3% max
Broken 2% max 5% max 3% max
Black bean 2% max 5% max 3% max

jute bag ( net 60 jute bag ( net 60 jute bag ( net 60
Packing
kg) kg) kg)
Origin Viet Nam Viet Nam Viet Nam
Cai Mep-Thi Vai Cai Mep-Thi Vai Cai Mep-Thi Vai
Port of loading
Port, Viet Nam Port, Viet Nam Port, Viet Nam
Production Date April 2019 April 2019 April 2019
Expiry Date April 2022 April 2022 April 2022

(Source: Vietnamcoffee.vn)
1.2.2. Production process
- Dry processing method:
11
Natural Coffee
Collecting and preservating materials
Drying
Separating impurities
Dry milling, Polishing
Classifing
Packing
Diagram 1.2 Production process of the coffee beans

(Source: tailieu.vn)
a. Natural coffee
Raw materials are harvested types of coffee, the main type of coffee is Robusta
and Arabica.
b. Collecting and preserving materials
- Collectin materials:
12
Coffee is collected manually, mainly by hand. Harvesting productivity depends
on many factors: early season, mid-season, late season, means of equipment for
harvesting.
- Preserving materials:
After harvest, raw materials should be processed as quickly as possible. If they
are not processed, covered place and spread into a layer of about 30-40 cm thick on
a clean background, 2-3 hours stirred once. The storage period is shorter and better,
often it lasts no more than 36 hours.
c. Drying
Coffee drying: It is the preferred technique because it is simple and
inexpensive. Furthermore, the ultraviolet rays of sunlight can bleach chlorophyll in
the seeds and reduce the smell of coffee.
Air drying: Coffee drying temperature from 45-55°C. Just 1°C increase will
reduce the relative humidity of the air to about 5%.
d. Separation of impurities
For dry method, people often use vibrating sieve to separate impurities.
e. Dry milling, polishing
- Dry milling
The green coffee after being dried, it was a mixture of: coffee beans, bark,
crushed seeds. Base on the nature and utility of each finished product in the dry
rubbing mixture is not the same.
- Polishing
Required after polishing:
+ Coffee temperature does not exceed 55 °C.
+ Ratio of cracked grains <1%.
+ The ratio of silk shells in green coffee: 10% for Arabica, 20% for Robusta.
f. Classifing
- By size
Sorting by size through sieves, people get 3 different sized coffee. Seeds>
6.3mm accounted for 70%, seeds> 5.6mm accounted for 20%, seeds> 5mm
13
accounted for 10%. People use two main sieves to classify them as round sieves and
sieve shakes.
- According to weight
Based on the difference in the weight of the seeds, using wind to classify, the
seeds with small weight will fly up.
The weight of the seeds depends on its moisture, usually the average density of
coffee beans is from 1.1 to 1.3.
- According to the color
Often based on state standards or trading contracts with relevant agencies that
meet the requirements of the purchaser and the producer.
g. Packing
Coffee beans are packed into jute bags with a weight of 60kg/bag for
preservation.
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CHAPTER 2: THE EXPORT PLAN
2.1 Legal base for exporting.
Based on Vietnam's Commercial Law 2015 and specialized laws related to
business plans.
Decree No. 09/2018 / ND-CP which regulated the Commercial law and The
Law on Foreign Trade Management on goods purchase and sale.
Customs Law on amendments and supplements to a number of articles passed
by the National Assembly of the Socialist Republic of Vietnam on June 23, 2014.
Import Tax and Export Tax Law No: 107/2016 / QH13 which regulated taxable
objects, taxpayers, tax calculation bases, tax calculation points, tax tables, anti-
dumping tax, anti-subsidy tax , self-defense tax applies to export and import goods;
tax exemption, reduction, refund of import and export tax.
Circular No. 39/2015 / TT-BTC which regulated customs value of imported
goods.
Decree No. 83/2013 / ND-CP dated July 22, 2013 of the Government on
implementing a number of articles of the Law on Tax Administration and amending
and supplementing a number of articles of the Law on Tax Administration;
Investment Law, November 26, 2014.
Based on the business sector listed in the business license of the company
issued by the competent authority.
2.2 Market base for exporting.
2.2.1 Market research results
2.2.1.1 Domestic market research.
- The supply of goods
According to survey data of International Coffee Organization ICO, in 2017-
2018, Vietnam is the second largest coffee exporter in the world (the world's
largest Robusta coffee), after Brazil. Vietnam exported nearly 1.8 million tons, a
record high, increasing nearly 200,000 tons (equivalent to 12.3%) compared to the
2016 - 2017 crop with a turnover of about 3.5 billion USD. This is also one of the
15
industries that bring the highest value to agricultural products with export turnover
accounting for about 10% of the total export turnover of agriculture, forestry and
fisheries.
Currently, domestic coffee is mainly grown by households (80-85%) and
purchased by companies, so there is no monopoly. However, because the domestic
consumption is too small, accounting for less than 10% of the purchasing source of
the purchasing companies is mainly export, which makes coffee manufacturing
enterprises weak in negotiating prices.
Robusta coffee is grown mainly in two regions:
 Trung Nguyen region: This region consists of a series of plateaus including
Dak Lak, Lam Dong, Gia Lai and Kon Tum provinces. The coffee industry
is concentrated around Buon Ma Thuot city. Dak Lak and Lam Dong are
the main production areas, planting about 70% of the country's Robusta
crop.
 The Southern: There are some Robusta coffee grown in Dong Nai
province, located in the North of Ho Chi Minh City.
In 645,400 ha (2016), growing coffee of the whole country is only about 55,000
ha of Arabica coffee. This coffee production is concentrated mainly in provinces
such as Lam Dong, Thua Thien Hue, Quang Tri, Nghe An, Hoa Binh, Son La and
Dien Bien.
The mainly coffee regions of the country are Dak Lak, Lam Dong, Dak Nong
and Gia Lai. According to the Bureau of Statistics data:
 Dak Lak, in the 2017-2018 crop year, the coffee area of the whole
province is 204,808 hectares, an increase of 1,071 hectares compared to
the previous crop year. Total production is estimated at 459,785 tons, an
increase of 11,975 tons compared to the 2016 - 2017 crop.
 Lam Dong currently has over 160,000 hectares of coffee, reaching an
output of about 360,000 tons / year in the 2017-2018 season.
16
 Dak Nong, the province has nearly 124,000 hectares of coffee, the total
coffee output of the whole district reached 267,499 tons, an increase of
16,792 tons compared to the previous year.
- Prices
Coffee prices in the Tay Nguyen region increased "shock" 1,100 VND / kg,
ranging from 30,100 to 30,900 VND / kg. In particular, the highest price recorded in
Dak Lak province and the lowest in Lam Dong, according to giacaphe.com. (May
10th, 2019)
The price of coffee around the port area in Ho Chi Minh City is 1,300 USD /
ton, an increase of 55 USD / ton.
Table 2.1 Compare prices of green beans market

Green Beans Market Average Price
FOB (HCM) 1,300
Dak Lak 30,900
Lam Dong 30,100
Gia Lai 30,500
Dak Nong 30,600
Exchange rate USD/VND 23,330
Unit: VND |FOB: USD($)/ton
(Source: giacaphe.com)
In general, in the first 4 months, domestic coffee prices tend to decrease.
Compared to the end of 2018, the price of buckwheat coffee in the Tay Nguyen
provinces decreased by 1,100-1,200 VND / kg. Coffee prices fell because of the
oversupply pressure on the global coffee market. The cause comes from concerns
that the US-China trade dispute makes most commodity prices decline. At the same
time, due to Brazil's Reais - the world's largest coffee producing nation, has been
weakening, the world coffee price dropped sharply, affecting domestic coffee prices.
17
Table 2.2 Compare prices of domestic competitors
Types Prices
250,000VND/kg, FOB
Robusta beans coffee grade I ( Buon Ho-Dak Lak)
HCM
180,000VND/kg, FOB
Robusta beans coffee grade II ( Buon Ho-Dak Lak)
HCM
330,000VND/kg, FOB
Arabica beans coffee grade I ( Cau Dat-Da Lat)
HCM
(Source: caphecaudat.com, caphedaklak.com)
- Competitors
In Vietnam, most of the coffee is produced by households with coffee growing
area of about 2-5 ha / household, state enterprises account for 15% of the rest are
grown in large farms. Buon Ma Thuot, Dak Lak and Trung Bo tableland are famous
coffee producing areas in Vietnam.
According to information from the Vietnam Coffee and Cocoa Association
(VICOFA), coffee purchasing from households is mainly done by traders and sold
to coffee enterprises. Currently there are about 150 coffee exporting enterprises in
the country with more than 3,000 agents participating in purchasing coffee. The
number of FDI enterprises investing in the coffee industry is not large, but it
accounts for a large proportion of the total coffee beans export turnover of Vietnam.
Intimex Group Joint Stock Company (Intimex) is the leader in purchasing,
processing and exporting coffee and is one of the largest coffee beans exporters in
the world, in 2016 exports about 55,000 tons. In the "race" of raw materials, the
company has invested heavily in the Tay Nguyen and Dong Nam Bo to ensure the
output of exported coffee.
Along with Intimex, the second largest coffee exporter in Vietnam is Tin Nghia
Corporation (Tin Nghia) in the last 7 months of 2016 with export turnover of 120
million USD. In particular, trading, processing and exporting coffee is still a
"spearhead" of the four key areas of the company. During this period, the average
18
output of exported coffee reached 125,000 tons / year or more (including coffee
beans and deep-processing coffee). Since 2017, high quality coffee and quality
certified coffee account for at least 50% of export volume.
In the coffee sector, Intimex Group is a "reputable export enterprise" with the
highest export turnover, reaching USD 806,658,455 in 2017.
Table 2.3 Export Turnover of coffee’s company in Intimex Group 2017
Export Turnover
Serial Company’s name
(USD)
1 Intimex Group Joint Stock Company 806,658,455
MTV Export and Import 2/9 Dak Lak Limited

2 215,500,157
Company
3 Intimex My Phuoc Joint Stock Company 160,714,928
Louis Dreyfus Company Vietnam Trading and

4 143,881,020
Processing Co., Ltd
5 Atlantic Vietnam Trading Limited Company 143,562,191
6 Tin Nghia Corporation 128,278,350
7 Mascopex Joint Stock Company 111,394,280
8 Phuc Sinh Joint Stock Company 110,472,823
9 Vinh Hiep Limited Company 96,716,773
10 Intimex Dak Nong Joint Stock Company 76,857,874
(Source: intimexhcm.com)
In addition, there is Vietnam Coffee Corporation (VINACAFE) which is a State
Corporation with units located in 15 provinces and cities nationwide and 1 unit
19
operating in Laos. This is also Vietnam's leading supplier of beans coffee -
accounting for 30% of the country's beans coffee market share. Member companies:
the branch and the center of the parent company are 16 units, the corporation holds
100% of charter capital of 29 units, the corporation holds the controlling power of 8
units and companies and the link is 8 units.
The model of coffee producing households concentrates mainly in key areas of
the Tay Nguyen such as Dak Lak, Lam Dong and Dak Nong provinces. Most of
farmer producing an area of 1 ha or more are equipped with a technological line for
processing dried green coffee with a small scale of several hundred tons / year.
2.2.1.2 Foreign market research.
a.On the global market.
Table 2.4 Quantity, Consume, Ending stocks on the global according to the
Season
Season 2018/2019 2017/2018 Increase/Decrease
Quantity 174,5 158,9 +15.6
Consume 163,6 160,3 +3.3
Ending stocks 37,1 30 +7.1
Unit: million bags, 60kg/bag (Soure: thitruongcaphe.net)
Based on the report of the international coffee supply and demand of the US
Department of Agriculture (USDA) issued in early 12/2018, despite the increase in
coffee consumption, the supply of coffee in the world is still abundant by the end of
2018 through 2019 and the end-of-term inventory increased sharply.
- The demand of goods
Coffee consumption countries can be divided into four main groups by geographical
area as follows:
Group of European countries.
Group of North American countries: In which the US market is the largest with
annual demand about 4 kg / person / year.
Asia-Pacific Ocean Group: Two typical markets are Korea and Japan.
Africa and Mexico- Central America Group.
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Coffee consumption in the world is estimated to increase by 1.8% compared to
last year to 161.93 million bags in 2017 - 2018. Among them, the fastest growth is
Asia - Pacific, with consumption in an increase of 3.1% compared to last year to
35.9%. North America is the second fastest growing region with 2.6% to 30.34
million bags. Africa and Mexico - Central America are forecast to increase 1.7%
from last year to 11.08 million bags and 5.3 million bags respectively. Coffee
consumption in Europe increased by 0.5% to 52.32 million bags in 2017 - 2018.
+ Europe market:
Europe is the world's largest coffee market, accounting for about 30% of global
coffee consumption, the level of coffee consumption is relatively stable in the 2013-
2016 period. In Europe alone, coffee consumption in 2015 reached 2.5 million tons.
Europe has the largest per capita consumption of coffee in the world, up to about
5kg / person / year. In the UK, per capita consumption of coffee is about 3.3 kg /
person / year. Coffee consumption also grew steadily in some markets in Central and
Eastern Europe, such as Poland. In Poland, coffee consumption growth reached 80%
in the last 10 years. However, per capita coffee consumption in Poland is only 2.3
kg / person / year, much lower than the European average.
Northern European markets such as Finland, Sweden, Norway and Iceland have
the highest per capita consumption of coffee, more than 8kg / person / year. These
are stable markets, where average coffee consumption per capita will not fluctuate
strongly. Selecting high quality coffee and growing consumption outside the
household shows changes in coffee drinking habits in these markets.
Consumer trends:
 EU consumers increasingly prefer convenience and compactness due
to changing working environment.
 Consumers care more about the environment and social responsibility.
 Customers are increasingly concerned about their own health.
 More and more requests to diversify products made from coffee.
21
Consumption styles in EU countries similar. Espresso and cappuccino are
becoming more and more popular. In general, differences in coffee consumption are
less pronounced among regions in the EU and the world.
Market segmentation trend:
 Raw coffee: the majority of traded coffee on the market is unroasted,
unprocessed coffee (more than 80%). Developing countries play an
important role in this segment.
 Coffee roasted: the majority of coffee consumed in the EU includes
roasted coffee and ground coffee. In addition, instant coffee accounts
for a small portion of the EU market.
+ Korean market:
According to ICO, Korea is the 11th largest coffee consumer in the
international. According to statistics, in 2018 Korea has about 26.5 billion cups of
coffee sold and the number of coffee shops is estimated at 88,500 stores, an increase
of 63% compared to 2017. That corresponds to having one coffee shop for every 600
Koreans. According to estimates, the total value of coffee market in Korea reached
11 trillion Won (equivalent to 10.8 billion USD).
According to statistics from the Korea International Trade Association, the
country's coffee imports in the first 10 months of 2018 reached 132,969 tons, worth
US $ 533.29 million, up 0.2% in volume but down by 2 , 5% of the value compared
to the same period in 2017. In particular, shipments of coffee beans accounted for
about 90% of imports quantity, then roasted coffee beans, accounting for 6.3% and
instant coffee products accounted for 2.9 %. Coffee beans imports increased due to
coffee shops buying and mixing themselves. Vietnam is the second largest source of
coffee for Korea. Vietnam's coffee market share in Korea's total imports in 10
months reached 19%, up sharply from 13.6% of the same period in 2017.
Korean coffee is not pure coffee, they do not like the bitter like Japanese people.
Most Koreans like milk coffee, even more milk, aroma, fat, but sweetness must be
harmonious. That is the subtlety of Korean coffee culture. They like elegance,
22
lightness and comfort. Coffee is to enjoy, not to drink. They often prioritize the
brands they know.
Coffee export tax to Korea is quite low and is not subject to special
consumption tax, VAT is 10%.
Regulations on labeling of export goods: must have a label written in Korean
including the contents of the product name, product type and address, etc.
+ Japan market:
Japan imported 88,000 tons of coffee beans from Vietnam in 2017, increased
15% to 94,000 tons in January-November 2018. In Japan, robusta coffee is mainly
used as a material for instant coffee and is often sold in packs, popular for families
with only one or two members.
Japanese people drink coffee in moderation, paying attention to how to enjoy
each flavor of coffee. They love pure coffee. Of the three countries that consume the
most coffee in the world (USA, Germany, Japan), the taste of Japanese is "heaviest",
usually up to 13 gr / cup of regular espresso. In each region, tastes are also different,
Osaka people drink the heaviest, then Kyoto, Tokyo. Tokyo people like to drink
American style coffee, lighter, only about 9-10 grams / cup.
Vietnamese coffee products which were exported to the Japan must be checked
the type and composition of additives and many other substances. Some products
with banned ingredients in Japan or exceeding permitted levels will be banned from
importing into this market.
Currently the ASEAN-Japan Closer Economic Partnership (AJCEP) takes
effect from December 1, 2008 and the Vietnam-Japan Economic Partnership
Agreement (VJEPA) takes effect from October 1st, 2008. 2009 is the legal
framework for cooperation between Vietnam and Japan.
- The suppy of goods
The coffee industry is the fifth largest consumer product in the world and
occupies an important position in world commodity agriculture. Currently, there are
more than 25 million coffee growers in the world, the world coffee market has
doubled in the last 10 years.
23
The International Coffee Organization (ICO) estimates coffee production in the
2017-2018 crop year, global coffee production is estimated to increase 4.8% to
163.51 million bags compared to last year. Thus, coffee output is 3.1% higher than
the ICO forecast given in the previous period. Arabica coffee output increased by
1.7% to 101.23 million bags; Robusta coffee increased 10.5% to 62.28 million bags.
Production increased in all coffee producing areas. Asia-Pacific Ocean region
saw the strongest growth with output increasing by 8.3% to 47.95 million bags.
Followed by Mexico - Central America, production increased by 4.3% to 21.34
million bags. South America, the largest manufacturing region in the world, has a
3.3% increase in coffee production to 76.98 million bags, while Africa increased
3.4% to 17.25 million bags.
In September, Brazil and Colombia accounted for 60.4% of total green Arabica
coffee exports, while Vietnam accounted for 60% of the total volume of exported
Robusta coffee.
Brazil: exported 32.34 million bags of coffee, up from 31.93 million bags in
2016 - 2017 and increased by 14.7% in production of 2017 - 2018.
Colombia: In contrast, Colombia exported 12.72 million bag of coffee and
decreased by 5.7% in production of 2017-2018. Due to a downward output in
available quantity for export.
Indonesia: Coffee exports in Indonesia recorded the largest decrease when
decreased quantity from 8.72 million bags in 2016 - 2017 to 5.64 million bags in
2017 - 2018. Production decreased with increasing domestic demand led to this
decline.
b. On the import market.
- The demand of goods
America is a young and vibrant nation, people here love to live freely, all
according to their preferences, coffee culture is no exception. American coffee
culture is fast and cheap but still does not lose the true aroma of coffee, the time in
America is very precious. Americans use coffee as completely as they want, not as
24
sophisticated as Europeans, not as sophisticated as Arabs, drink to drink, drink freely
to help focus, alert.
America is not only the world's leading economy, but also the world's third
largest population, after China and India, the young population accounts for the
majority of the population structure. According to research results of market research
firm Euromonitor International, among 80 countries surveyed, Americans consume
the largest coffee through retail stores. According to NPD Group, in all food and
drink, coffee is still consumed the most in breakfast. More than half of Americans
drink at least one cup of coffee a day. In the United States coffee is a thriving
industry.
Table 2.5 Coffee import quantity of the US in 4 years 2015-2018

Increase or decrease
Quantity
Year Absolute (million Ralative
(million bags)
bags) (%)
2015 24.6
2016 25.8 1.2 4.88
2017 25 -0.8 -3.10
2018 27 2 8.00
(Source: Project - Planning Department, Ministry of Agriculture and Rural
Development)
Overall, the demand for coffee in the US market is still high. In 4 years 2015-
2018 coffee import volume increased steadily, only in 2017 was 0.8 million bags
due to low production cycle (every 2 years).
- The supply of goods
25
3
3.8
4.9 20
5.7
6.4
16.6
7.8
10 15.8
Colombia Brazil Other Countries Viet Nam

Canada Honduras Guatemala Nicaragua
Indonesia Mexico Costa Rica
Chart 2.1 Coffee market share of some countries in the US in the first 6 months of
2017 (Source: vietnambiz.vn)
26
Table 2.6 Coffee market share of some countries in the US in the first 6 months of
2017
Serial Country Proportion (%)
1 Colombia 20
2 Brazil 16.6
3 Other Countries 15.8
4 Viet Nam 10
5 Canada 7.8
6 Honduras 6.4
7 Guatemala 6
8 Nicaragua 5.7
9 Indonesia 4.9
10 Mexico 3.8
11 Costa Rica 3
(Source: vietnambiz.vn)
According to the Vietnam Coffee-Cocoa Association (VICOPA), the US
market is very fond of Catimor coffee belonging to the Arabica family. 70% of
coffee consumed in the United States is the type of Arabica imported from
Colombia, Brazil, Mexico, the rest is Robusta imported from Vietnam and
Indonesia. In the US market, Vietnamese coffee accounts for 10% of the total
volume and 6% of the total value of coffee imports of the United States, 90% of
27
Vietnamese coffee exported to the United States in the form of unroasted raw
materials, only 10% Split seeds and canned roaster.
Most of the United States cannot grow tropical food, but coffee is a tropical
crop. This plant requires a very complex ecological environment. Because coffee
has many types, of which the two most common types are Arabica and Robusta.
Each type has different temperature and precipitation requirements and is very
impervious to salt fog. This is difficult for the US to grow and produce coffee on its
own. But the United States has an advantage of well-developed equipment and
science and technology, so it is possible to import green coffee from countries with
high coffee production such as Brazil, Vietnam, Colombia, Indonesia, India, ... Since
then combined with available technology to continue processing green coffee into
more valuable products. The most famous coffee brands and stirring up the US
market: Café Du Monde, La Colombe Torrefaction, Stumptown Coffee Roasters,
Sightglass Coffee, Starbucks, etc.
America only grows coffee only in Hawaii. This is the only state growing and
trading coffee thanks to the appropriate tropical climate. Kona coffee is a very
famous Arabica coffee of Hawaii. "100% Kona coffee" is extremely expensive with
rare and rare places and a special law makes its own brand. This law does not allow
blending into Kona coffee even though it is another coffee grown in Hawaii. There
are currently about 800 Kona coffee farms in Hawaii. This is considered to be the
smallest coffee growing area in the world but it produces very high quality products.
c. Opportunities and challenges for the coffee industry when Vietnam joins
TPP, EVFTA
The accession to TPP provides the coffee industry with export and development
opportunities. Among TPP member countries, there are 2 countries applying
Vietnam's coffee import tax, Mexico (20%) and Peru (11%), after joining TPP,
Vietnam coffee imports these two markets reduce taxes to 0%. In addition,
agriculture in general and the coffee industry in particular will attract many foreign
investors who are able to attract many foreign investment sources to apply modern
science and technology. Besides the opportunities offered, joining the TPP also
28
poses many challenges to the coffee industry: technical challenges, environmental
challenges, food hygiene and safety, transparency challenges, etc.
EVFTA is a new generation agreement with a wide range of commitments with
the highest level of commitment of Vietnam so far and also the first FTA of the EU
with a middle-income country. This agreement helps 99% of the tariff lines between
the two sides be abolished within seven years. This can be considered the highest
commitment level that Vietnam has achieved in signed FTAs. Notably, many items
are entitled to 0% tax rate including coffee. The biggest opportunity is to expand the
market and remove trade barriers so that Vietnam's coffee products are more deeply
involved in global production and supply chains. At the same time, it helps to
diversify import markets, avoiding dependence on traditional raw material markets.
However, strict technical barriers and sanitary and phytosanitary systems are barriers
that make it difficult for Vietnamese goods to enter the market of partner countries
EVFTA. This also means that the challenge for Vietnamese enterprises is the
competitive pressure on cheap goods and good quality services from partner
countries in the domestic market.
d. Import comditions
US coffee import standards are based on quality standards of ICO (International
Coffee Organization). It is the national standard TCVN 4193: 2014 which has been
considered by ICO as a standard to classify coffee in the quality inspection of
exported coffee beans.
According to EUMUNTRAP (2016), technical barriers to the US export market
often stipulate that export goods must meet the following conditions:
Regulations on management systems at production units such as ISO 14001
Certification, Eco-Management and Audit Scheme (EMAS), SA8000 certification
are also necessary conditions for export. Products are exported to European and
American markets.
Labeling requirements: In principle, all products must be inspected and labeled
to comply with applicable regulations and laws. Under the federal food, drug and
cosmetic law, each food brand must contain specific, recognizable information that
29
ordinary customers can read and understand under normal conditions when buying
and using. All foods must be labeled in English, containing information about
ingredients, nutrition, standard values for daily use, country of origin, manufacturer's
name and address importer in English.
Food additive regulations: Food additives must be censored before being placed
on the market. Before offering a colorant food or additive to the US market, the
manufacturer must submit a request to FDA for approval. An application for
approval of food or color additives must have convincing evidence that the additive
will work as intended. The FDA then based on existing scientific progress will
decide to approve if the additive is safe according to the proposed conditions of use.
2.2.2 The order of business partner
ARMY Coffee Export Limited Company
Tel: (8423) – 788798 Fax: (8423) – 788799
Representative: Mr. Dang Dinh Tuan – Director
To: Volcafe Joint Stock Company

Address: No 155 E Shaw Ave, Ste. 104, Fresno, LosAngeles, USA
Tel: 253 891 2500 Fax: 253 891 2500
Representative: Mr. Collins Matthew Robert – Managing Director
OFFER NO A123
Dear Sir,
Thank you for your letter which you send us on 3 rd December, 2018, asking
about the the detail of commodity and condition sales.
We are pleasure to send you an offer on the price and condition sales following:
1. Commodity: (Unit price: CIF New York Port, USA, Incoterms 2010)
30
 Robusta Coffee Beans grade 1: 1,954 USD/MT
 Arabica Coffee Beans grade 1: 3,400 USD/MT
2. Quantity:
 Robusta Coffee Beans grade 1: 500 MT (more or less 3%)

 Arabica Coffee Beans grade 1: 1,000 MT (more or less 3%)
3. Specification:
Moisture: 12.5% max
Black& Broken beans: 2% max
Foreign matter: 0.5 % max
Other coffee beans: 0.5% max
>90% on Screen No. : 18 (7.1mm)

4. Payment: to be made by irrevocable L/C in to our account No: 087421530 at
HSBC North American Holdings Inc.
5. Time of shipment: Before May 29𝑡ℎ ,2019.
We are looking forward to your first order. Once again, thank you for your attention.
New York, USA, 15𝑡ℎ of March, 2019
Yours Faithfully,
Director
31
Tel: (8423) – 788798 Fax: (8423) – 788799
To: Olam Joint Stock Company

Address: 2381 Rosecrans Ave, Suite 200 El Segundo, CA 90245. USA
Tel: 253 891 3700 Fax: 253 891 3700
Representative: Mr. Jennifer James – Managing Director
OFFER NO A124
Dear Sir,
Thank you for your letter which you send us on 1 st December, 2018, asking
2. Quantity:

3. Specification:
Moisture: 12.5% max

32
>90% on Screen No. : 18 (7.1mm)

We are looking forward to your first order. Once again, thank you for your
attention.

Yours Faithfully,
Director
33
Tel: (8423) – 788798 Fax: (8423) – 788799
To: Joyal Co., Ltd

Address: 8752 Westminster Blvd. Westminster, CA 92683 USA.
Tel: 253 891 4000 Fax: 253 891 4000
Representative: Mr. Justin Bieber – Managing Director
OFFER NO A125
Dear Sir,
Thank you for your letter which you send us on 3 rd December, 2018, asking
2. Quantity:

3. Specification:
Moisture: 12.5% max

34
>90% on Screen No. : 18 (7.1mm)

We are looking forward to your first order. Once again, thank you for your
attention.

Yours Faithfully,
Director
35
Volcafe Joint Stock Company
Address: No 155 E Shaw Ave, Ste. 104, Fresno, New York, USA
Tel: 253 891 2500 Fax: 253 891 2500
Representative: Mr. Collins Matthew Robert – Managing Director
To: ARMY Coffee Export Limited Company

Tel: (8423) – 788798 Fax: (8423) – 788799
ORDER NO B561
Dear Sir,
We are very interested in coffee products in the offer that you sent us on
7th December, 2019. We are one of the leading distributors in the region and
are currently looking for new business partners in Vietnam. We want to order
the following items: Yours faithfully
Quantity Unit Price

Commodity Description-Quality
(MT) (USD/MT)
Moisture : 12.5% max

Black& Broken beans : 2% max
Robusta
Coffee Beans Foreign matter : 0.5 % max 500 ± 3% 1,954
grade 1
>90% on Screen No. : 18 (7.1mm)
Moisture : 13% max
Robusta Black& Broken beans : 5% max
Coffee Beans 500 ± 3% 1,823
grade 2 Foreign matter : 1 % max
Other coffee beans: 1% max
36
>90% on Screen No. : 13 (5.0mm)
Arabica
Coffee Beans Foreign matter : 0.3 % max 1,000 ± 3% 3,400
grade 1
>90% on Screen No. : 18 (7.1mm)
Total Amount (CIF New York Port) 5,288,500 USD
Packing: Coffee beans to be packed in single jute bags of 60 kg net each, about
60.2 kg gross each, sewn at mouth with jute twine thread suitable for rough handling
and sea transportation.
Payment: to be made by irrevocable L/C in to our account No: 087421530 at
Delivery: Before May 29𝑡ℎ ,2019.
Thank you for reading this letter. I am looking forward to receiving your reply.
Yours Faithfully,
Vice Director
37
Olam Joint Stock Company
Address: 2381 Rosecrans Ave, Suite 200 El Segundo, CA 90245. USA
Tel: 253 891 3700 Fax: 253 891 3700
Representative: Mr. Jennifer James – Managing Director

Tel: (8423) – 788798 Fax: (8423) – 788799
ORDER NO B562
Dear Sir,
Quantity Unit Price

(MT) (USD/MT)

Robusta
grade 1
>90% on Screen No. : 18 (7.1mm)
Moisture : 13% max
38
>90% on Screen No. : 13 (5.0mm)
Arabica
1,000 ±
Coffee Beans Foreign matter : 0.3 % max 2,200
3%
grade 1
>90% on Screen No. : 18 (7.1mm)
Total Amount (FOB HCM Port) 3,305,000USD
Yours Faithfully,
Vice Director
39
Joyal Co., Ltd
Address: 8752 Westminster Blvd. Westminster, CA 92683 USA.
Tel: 253 891 4000 Fax: 253 891 4000
Representative: Mr. Justin Bieber – Managing Director

Tel: (8423) – 788798 Fax: (8423) – 788799
ORDER NO B563
Dear Sir,
Quantity Unit Price

(MT) (USD/MT)

Robusta
grade 1
>90% on Screen No. : 18 (7.1mm)
Moisture : 13% max
40
>90% on Screen No. : 13 (5.0mm)
Arabica
grade 1
>90% on Screen No. : 18 (7.1mm)
Yours Faithfully,
Vice Director
41
In the above 3 orders, we decided to choose Volcafe Joint Stock Company to
sign the contract.
Reason:
- Volcafe Joint Stock Company orders: Volcafe Joint Stock Company has
fully agreed on all the conditions that our company has set.
- Olam Joint Stock Company orders: Olam Joint Stock Company changed the
price conditions of the company. Specifically, the Olam Joint Stock
Company changed the prices of coffee items as follows:
Robusta Coffee Beans grade 1: 1,954 USD/MT
Arabica Coffee Beans grade 1: 3,400 USD/MT
Total amount (CIF New York Port): 5,288,500 USD
Replaced by:
Robusta Coffee Beans grade 1: 1,610USD/MT
Arabica Coffee Beans grade 1: 2,800 USD/MT
Total amount (FOB HCM Port): 4,255,000USD
We change from FOB price to CIF price:
𝐶+𝐹 2,255,000+60,000
CIF = = = 4,323,647 𝑈𝑆𝐷
1−𝑅 1−0,2%
So we can see the benefits of the company are reduced.
- Joyal Co., Ltd orders: Although Joyal Co., Ltd kept the same price and other
packages, it changed the quantity. Specifically:
Robusta Coffee Beans grade 1: 500 MT
Arabica Coffee Beans grade 1: 1,000 MT
Replaced by:
Arabica Coffee Beans grade 1: 900 MT
42
Meanwhile the company has the capacity to produce a large quantity of goods
as the quantity of goods set. In addition, the comparison between Joyal Co., Ltd and
Volcafe Joint Stock Company shows that Volcafe Joint Stock Company has a long
history and a high reputation in business rather than a newly established company
like Joyal Co., Ltd.
 Choose Volcafe Joint Stock Company.
2.2.3 Financial analysis
2.2.3.1 Estimated cost for export shipments of 2,000 MT
43
Table 2.7 Estimated cost for export shipments of 1,500 MT Arabica Coffee
and 500 MT Robusta Coffee
Total amount
Items Price (VND/MT)
(VND)
Robusta coffee (2,500 MT) 8,000,000 20,000,000,000
Arabica coffee (2.500 MT) 13,000,000 32,500,000,000
Cost of wrapping, packing,

875,000 175,000,000
label
Labor cost 5,500,000 11,000,000,000
Depreciation 5% value 150,000,000
Bill of electricity, water,

50,000,000 50,000,000
telephone
Interest from the bank 0.8% x 50,000,000,000 400,000,000
Total cost of production 64,275,000,000 VND
Table 2.8 Export freight costs

Total amount
Items Price (VND/MT)
(VND)
Shipping cost by vehicle 600,000 1,200,000,000
Cost of loading goods on board 300,000 600,000,000
Shipping costs by boat 697,800 1,395,600,000
Total transportation cost 3,195,600,000 VND
44
Table 2.9 Expenses for export of goods
Items Price Total amount (VND)
Transaction fees 5,000,000 VND 5,000,000
200,000 VND
Customs fees 800,000
/customs declaration
Export tax 0% 0
Inspection fees 100,000 VND /MT 200,000,000
B/L fees 500,000 VND 1,000,000
Fees for sending

340,000 VND /voucher 1,360,000
vouchers
Notification fees, send
Fees related to
original L/C, verify L/C 5,000,000
payment
information
Fees for tranfering
23,260,000 VND 23,260,000
money at bank
Expenses for L/C
notification of the 6,978,000 VND 6,978,000
Bank
Insurrance 110% CIF 270,623,122
Total cost of the export

514,021,122 VND
procedures
45
Table 2.10 Summarize the cost of export shipment
Items Total amount (VND)
Production cost 64,275,000,000
Transportation cost 3,195,600,000
Cost of the export procedures 514,021,122
Total (1) 67,984,621,122
Reserve funds (2) =3 % ∑Total 2,039,538,634
Revenue(3) = 5,288,500 USD 123,010,510,000
Income tax = 25 % ( (3) - (2) - (1) ) 13,246,587,561
Total cost for export shipment 81,231,208,683 VND
2.2.3.2 Set the price
Table 2.11 Set the price

Price Total amount
Commodity Quantity (MT)
(USD/MT) (USD)
Robusta Coffee Beans
500 1,954 977,000
grade 1
Robusta Coffee Beans
500 1,823 911,500
grade 2
Arabica Coffee Beans
1,000 3,400 3,400,000
grade 1
2.2.3.3 Calculate revenue, profit & other financial criterias

Revenue = 977,000 + 911,500 + 3,400,000 = 5,288,500 USD
46
= 123,010,510,000 VND
Cost = 67,984,621,122 VND
Gross profit = Revenue – Cost = 123.010.510.000 – 67,984,621,122
= 55,025,888,878 VND
Income tax = 13,246,587,561VND
Net profit = Gross profit – Income tax = 55,025,888,878 – 13,246,587,561
= 41,779,301,317 VND
𝒏𝒆𝒕 𝒑𝒓𝒐𝒇𝒊𝒕 𝟒𝟏,𝟕𝟕𝟗,𝟑𝟎𝟏,𝟑𝟏𝟕
Rate of return = = = 0.3394
𝒓𝒆𝒗𝒆𝒏𝒖𝒆 𝟏𝟐𝟑,𝟎𝟏𝟎,𝟓𝟏𝟎,𝟎𝟎𝟎
With this rate of return, the company is operating profitably so the company
will accept this order and conduct to fulfill the order.
Rate of export foreign currency:
𝑫𝑻𝒙𝒌 (𝒄𝒖𝒓𝒓𝒆𝒏𝒄𝒚) 𝟓, 𝟐𝟖𝟖, 𝟓𝟎𝟎 𝟏
𝑹𝒙𝒌 = = =
𝑪𝑷𝒙𝒌 (𝒅𝒐𝒎𝒆𝒔𝒕𝒊𝒄 𝒎𝒐𝒏𝒆𝒚) 𝟔𝟕, 𝟗𝟖𝟒, 𝟔𝟐𝟏, 𝟏𝟐𝟐 𝟏𝟐, 𝟖𝟓𝟓
The company spend 12,855 VND to get 1 USD , while the current exchange
rate at the bank is 23,260 VND. Therefor, the company operates in a profitable way.
From all of the above financial performance analysis data, it shows that this is
a valuable and profitable order for the company. The company should actively carry
out production activities to keep up the progress of order fulfillment.
Total capital for contract implementation: 81.1 billion
In particular, equity of enterprises accounted for 38.35%: 31.1 billion
Borrowing from banks to open L/C to carry out the shipment of 61.65%: 50
billion
2.3. Select target market and business partners
2.3.1. Select target market
America is a big coffee consumption market and the second largest coffee
importer after the EU. The US is a coffee importer of Vietnam ranked second after
Germany. Vietnam is the second largest coffee exporter to the United States after
Colombia.
a. Supply in the US market:
47
The US market is an attractive market for coffee for coffee exporting countries
in the world.
Although Vietnam is the second largest coffee exporter to the US and has a
certain position, Vietnam still faces fierce competition in the US market.
Specifically, the proportion of American coffee imported from countries
around the world is as follows: Colombia accounts for 17%, Vietnam, Brazil
accounts for 15%, Guatemala accounts for 11%, Mexico 10%, Indonesia 9%, etc.
Although there are many countries exporting coffee to the US, Vietnam does
not have to compete with all the above countries but only compete with the same
products as competing with countries like Brazil, Indonesia and some other African
countries.
Thus, we can see that Vietnam has a certain position in the US coffee market,
Vietnam has also captured a number of large markets, enabling the company to be
easier to export coffee to America. Thanks to a certain foothold, the company can
take advantage of all the potential of the old market and try to find more new
markets.
b. Competition in the US market:
Competitive products:
Vietnam's export coffee to the US market is mainly Robusta (Robusta),
accounting for more than 80% of the total Vietnamese coffee export volume to the
US. Therefore, Vietnamese coffee has to compete with similar products exported to
the US such as Indonesia, India, etc. Meanwhile, Vietnamese coffee exports to the
US face the competition of coffee of it is the US that needs to use coffee from the
American people accounts for 70%.
Therefore, the company has built a business strategy to be able to compete in
the US coffee market, the company constantly improves the quality of coffee and
offers a good competitive price. Due to high demand for Arabica coffee, the
company has produced and exported a large amount of Arabica coffee to the United
States.
48
Competitors:
Vietnam faces many competitors in the United States, mainly from coffee
exporters to the US of Indonesia, Thailand, India, African countries, Brazil, Mexico.
c. American consumer demand for coffee
Rating scale: 1 to 5 (5 being the best)
Table 2.12 Market Factor Assessment
Rating
Demographic/Physical Environment
Population size, growth, density 4
Urban and rural distribution 4
Climate and weather variations 3
Shipping distance 4
Physical distribution and communication network 4
Natural resources 3
Political environment
Systems of Government 4
Political stability and continuity 3
Ideological orientation 4
Government involvement in business 5
Competitive environment
Uniqueness of your product 4
Pricing of competitive products 3
National economic and development priorities 4
Regulatory or quality standards for imports 4
Economic Environment
Overall level of development 5
Role of foreign trade in the economy 4
49
Currency: inflation rate, availability, controls, stability
5
of exchange rate
Balance of payment 4
Per capital income and distribution 3
Social/Culture Environment
Literacy rate, educational level 5
Understanding of the class structure 4
Similarities and differences in relation to domestic
3
market
Language and other cultural considerations 3
Market access
Limitation on trade: high level, qoatas 4
Documentation and import regulations 4
Local standards, practices, and other non tariff barriers 4
Patents and trademark protection 4
Product Potential
Customer need and desires 4
Opportunity for market segment within greater
3
population
Local production, imports, consumptions 4
Competitive offerings 4
Attitudes toward products of foreign demand 4
Local distribution and producing
Availability of intermediaries 4
Regional and local transportation facilities 3
Availability of manpower 4
Conditions for local manufacture 4
(Source: brandsvietnam.com)
50
American people have great demand for coffee. It is worth mentioning here that
Americans have a habit of using morning coffee. This is considered an indispensable
drink of Americans.
According to the National Coffee Association of America (NCA), up to 63%
of adults consume coffee daily. America is the largest coffee consumer in the world.
Therefore, coffee retail chains in the US increased rapidly.
Coffee is the most favorite drink in the United States, playing a very important
role in the economy. According to statistics, in 2015, the economic impact of the
coffee industry for the United States was 225.2 billion USD, of which consumers
spent 74.2 billion USD for coffee and industry also created nearly 1.7 million jobs
and up to $ 28 billion in taxes. According to the US Department of Agriculture, the
United States is the second largest coffee importer in the world, after the EU, with a
2019 turnover forecast to increase 2.1 million bags to 26.5 million bags. Leading
suppliers include Brazil (23%), Colombia (22%), Vietnam (15%) and Honduras
(6%).
d. Coffee in US
Despite the huge demand for coffee, the United States only grows coffee mainly
in Hawaii, which is Kona coffee, grown on the slopes of an active volcano, Mauna
Loa. This type of coffee is said to have good quality, delicious taste and always needs
very high consumption.
Low US coffee production is sufficient to meet domestic demand, so importing
coffee is a natural thing.
e. Vietnam's advantages:
Due to the suitable climate, Vietnam can grow a large amount of coffee, thereby
creating an input source for coffee exporting enterprises. Vietnamese coffee flavor
is also very special and popular among Americans.
Vietnamese coffee has a special flavor with cheaper price compared to coffee
of the same type of countries. Besides, Vietnamese coffee is appreciated by roasters
around the world as easy to process, especially for instant coffee processing.
51
As a strategic export product, the State should be given preferential treatment
through policies on investment credit, export credit, trade promotion as well as other
supports in research and development.
World coffee demand is constantly increasing, especially the changes in habits
and consumption habits of Asian people, including Japanese and Chinese
consumers, the two countries close to them. We have a large market. Besides, the
demand for coffee in Europe and North America has also increased.
The US lifted the economic embargo on Vietnam and the fact that the two
countries signed a bilateral trade agreement (February 2000) is an advantage for
Vietnamese coffee export, especially in the market large coffee parts like the United
States. In the coming time when Vietnam officially becomes a member of WTO, our
export coffee will have even more advantages.
0% coffee export tax policy has created a huge advantage for Vietnamese coffee
exporters. Creating for Vietnamese coffee has price competition.
From all of the above analyzes, we can see that the US is a potential export
market. So our company decided to choose America as the main coffee export
market.
2.3.2 Search for business partners
Choosing a good business partner is extremely important for businesses,
because it determines a 50% success rate. So, how to search for you to do real
business and how to promote this relationship is always an important issue for
businesses.
Our business is primarily aimed at experienced retailers and distributors in the
US retail industry. American confectionery companies and corporations. Businesses
always research and understand the market, and look for good partners who need
long-term cooperation.
The company's goal in the future is to maintain stable annual profit growth in
the range of 15-25%, thus easily consolidating old relationships with long-term
customers. Besides, the company is constantly looking for new partners, new
customers to be able to constantly develop public, achieve the strategic objectives
52
set out. This gives the company an advantage in scaling up business, investing in
other activities to gain more benefits.
Therefore, the company has set the criteria to select business partners such as:
- Partners must have strong, famous and reputable financial resources.
- Partners must be unprecedented enterprises that have happened before.
- Partners are in need of importing a large amount of coffee.
In the process of constantly looking for new business partners, the company
chose to see Volcafe Joint Stock Company as a partner in line with the company's
standards.
Through company analysis, but the advantages of Volcafe:
- This is a company with a long history of establishment, a prestigious company
in the world market.
- Strong financial potential of the company.
- Recently, because the company has been searching for a large consumer
market, it requires a large amount of coffee bean input to process roasted and
ground coffee and domestic consumption.
The company decided to send sales letters to the company and went to
negotiate. Through negotiation, the supply meets demand and the two companies
come to the decision to sign a contract according to price and other agreed terms.
The company sees this as a very potential partner so it will try to maintain a
good working relationship with Volcafe and do business for a long time.
The motto of the company is to take quality as the first, take the prestige as the
first, so the company does not make efforts to improve daily quality. At the same
time, the company always takes the prestige as the first, so it always delivers on time,
at the right place, in the right quantity and with the right quality. The company
constantly improves production techniques, has strict management methods of
production and delivery processes. Therefore, the company created prestige and
gained a foothold. Along with professional broadcast experts, the company has
53
overcome a lot of work to win a business contract with the Volcafe company and
offers maximum benefits to both parties.
2.4 Sign the international sale of goods contract.

2.4.1 Identify the negotiating method
In the project transaction, the company decided to choose a direct trading
method.
The reason is that the staff of the export and import business department of the
company have good foreign language skills and expertise, fully capable of
conducting research and research on customers on the international market.
Moreover, the company has experience in exporting to some partners in the US
before making this transaction.
Identifying America as a potential market, if successful implementation of this
contract, will open a great opportunity in the future. Direct transaction forms will
help both parties learn more about each other, build trust and create conditions for
long-term cooperation.
From the above reasons, the choice of direct transaction is reasonable and
effective, using the broker is not necessary in this case. In order to increase the
certainty of transaction information, the enterprise will use the verification service
on credit history and partner reputation provided by the bank.
2.4.2 Form the contract
54
SALE CONTRACT
No: 424/HD2019
Date: 24th March, 2019
THE SELLER: ARMY Coffee Export Limited Company

Address: No. 8, Long Dinh hamlet, Long Kien commune, Cho
Moi district, An Giang province, Vietnam.
Tel: (8423) – 788798

Fax: (8423) – 788799
Email: [email protected]
Website: http://www.armycoffee.vn
Represented by: Mr. Dang Dinh Tuan – Director
THE BUYER: Volcafe Joint Stock Company

Address: No 155 E Shaw Ave, Ste. 104, Fresno, New York, USA
Tel: 253 8912500
Fax: 253 891 2500
Represented by: Mr. Collins Matthew Robert-Managing Director
After discussion, the Seller agreed to sell, the Buyer agreed to buy and both
parties agree to sign this contract on the following terms and conditions:
ARTICLE 1. DESCRIPTION OF GOODS
55
Quantity Unit Price
(MT) (USD/MT)

Robusta
Foreign matter : 0.5 % max
grade 1 Other coffee beans: 0.5% max
>90% on Screen No. : 18
(7.1mm)
Moisture : 13% max
Robusta
Foreign matter : 1 % max
grade 2 Other coffee beans: 1% max
(5.0mm)
Arabica Coffee Foreign matter : 0.3 % max
1000 ± 3% 3,400
Beans grade 1
(7.1mm)
In word: US Dollar Five Million Two Hundred Eighty-eight Thousand Five

Hundred.
Quality of goods is to be determined at the loading port by Vinacontrol.
Inspection charges shall be borne by the Seller.
C/Q issued by Vinacontrol shall be find and binding both parties.
The mentioned above quantity is understood as gross weight for net.
56
Quantity is determined at the unloading port by Continent Inspection Service
Co.; Ltd.
C/Q issued at the unloading port shall be final and binding both parties.
These price are understood CIF New York Port, USA as per Incoterms 2010.
ARTICLE 2. PACKING
The Seller is obliged to packing coffee beans in 60 kg bags suitable for sea
transport with transshipment.
Coffee beans to be packed in single jute bags of 60 kg net each, about 60.2 kg
gross each, sewn at mouth with jute twine thread suitable for rough handling and sea
transportation.
ARTICLE 3. SHIPMENT
Delivery as per CIF New York Port, USA, Incoterms 2010.

Time of delivery: No later than May 29𝑡ℎ , 2019.
Port of loading: Cai Mep – Thi Vai Port, Vietnam.
Port of unloading: New York Port, USA.
Notice of loading: the seller is obliged to inform the buyer of the fulfillment of
the delivery obligation.
ARTICLE 4. PAYMENT
The buyer will have to pay for the purchase for the seller by bank transfer within
20 days after delivery. If the buyer fails to pay up within the time limit, they shall
bear interest on deferred payment for the seller at the interest rate of Vietnamese
commercial banks at the time of payment.
The buyer must open an irrevocable Letter of credit, at sight, in US Dollars
covering full value lodged with The Joint Stock Commercial Bank For Foreign
Trade Of Vietnam (An Giang) by a Bank agreed by both parties. L/C must reach the
Seller no later than 15 days prior to expected shipment time and be valid 45 days.
TTR is acceptable.
The L/C shall be payable on presentation of the following documents:
57
+ Bill of exchange at sight, drawn under the Buyer.
+ Full set(s) of clean on board ocean bill(s) of lading marked “Freight
prepaid”.
a- Commercial invoice in quadruplicate.
b- Packing list in duplicate.
c- Certificate of origin in duplicate.
ARTICLE 5. INSURANCE
Insurance conditions to buy: type C
The value of goods should be insured at least 110% of the value of the
commercial contract.
The place for complaining insurance claims is usually specified in the buyer's
country which helps the buyer easily claim compensation for insurance companies
when goods are at risk.
ARTICLE 6. CLAIM
In case upon taking the delivery, the Goods are not in strict conformity with
conditions stipulated in the contract in the terms of quality, quantity, and packing,
the buyer shall submit his claim together with sufficient evidence of copy of the
contract, Survey Report, Certificate of Quality, Certificate of Quantity, Packing List
with certification of the authorized inspection company agreed by the two parties
within 30 days upon the ship’s arrival.
Upon receiving the claim, the seller shall in a timely manner solve it reply in
writing within 30 days, after such receipt.In the case of the Seller's fault, the seller
shall deliver the replacements not after than 30 days after the official conclusion.
ARTICLE 7. FORCE MAJEURE
Neither party shall be liable for any delay or failure to perform its obligations
under this contract or for any damage or loss due to any event or circumstance
beyond its reasonable control.
58
The affected party shall within 10 days give notice in writing to the other party
specifying the cause and extent of its inability to perform its obligations and the
likely duration of such delay or non – performance and shall take all reasonable steps
and with due diligence to remedy or abate the Force Majeure.
ARTICLE 8. ARBITRATION
Any dispute, controversy or claim not amicably settles shall be settled by
arbitration. Arbitration to be held in the country of the defending party. The decision
taken by this arbitration will be final and binding.
All fees and expenses incurred from this arbitration shall be borne by the
losing party.
The language of arbitration shall be English.
ARTICLE 9. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
CISG law without regard to its conflict of laws rules.
ARTICLE 10. PENALTY
In the event that the Buyer fails to open L/C under this contract in due time, the
Seller will have the right to demand from the Buyer the payment of a penalty in the
amount equivalent to 1% per day of the contract amount. Should the Selles fails to
deliver the goods in due time, the Buyer will have the right to demand from the Seller
the payment of a penalty of 1% per day of the value of goods not delivered.
ARTICLE 11. VALIDITY OF CONTRACT
The contract takes effect from the date of signing the 24th March, 2019 to the
end of 29th May, 2019.
The amendment and supplement any provision of this contract is only valid
after it has been accepted by both parties in writing. Parties proposed amendments
and supplements are responsible for notifying other party at least 15 days on its
proposal.
This contract is made in 04 copies by English. Each party shall keep 02 copies.
The seller and buyer have thoroughly read all terms and conditions of the
contract and agreed by signing below.
59
For and behalf For and behalf
Of The Buyer Of The Seller
2.5 Export arrangement.

2.5.1 The process of implementation
After the export contract has been signed, ARMY coffee export company as a
contracting party must organize the implementation of that contract.
Check payment Procedure Delivery

confirmation Customs commodity
Prepare
Rent a ship Receive payment
merchandise
Inspect the item's

Buy insurance
quality
Diagram 2.1 The process of implementation

(Source: dankinhte.vn)
2.5.2 The steps
Step1: Check payment confirmation:
Payment method: irrevocable L/C
- Seller and buyer sign foreign trade contract (Commercial Contract). In the
contract the exporter and the importer must accept the L/C payment method.
The contract also specifies the requirements in the L/C. Even, dots and
commas must be clearly and uniformly defined. However, we also need to
60
understand that L/C is not necessarily the same as foreign trade contracts in
all regulations. These are 2 separate and non-binding documents.
- The buyer (importer) relies on the contract signed with the seller, applying for
opening L/C to his bank - THE ISSUING BANK. Records include:
 Application for opening L/C.
 Decision on establishment, business registration, import-export code
registration (if any) (for first-time transactions).
 Foreign trade contract.
 Payment commitment (in case of opening deferred L/C).
 If the buyer deposits L/C below 100% of the L/C value, there must be an
explanation given by the branch's credit bureau to approve the branch
director.
- The Issuing Bank will consider, if approved, to send the L/C to the bank
(Advising bank) to send to the beneficiary as the exporter (the beneficiary). And
note that the notification bank must have an agency relationship with the issuing
bank. Thus, the bank announced it would be able to test the authenticity of L/C.
- The bank announces that it will evaluate the L/C and transfer the original L/C
to the seller, the seller checks the ability to meet the L/C and can request a
correction (if necessary).
- Beneficiary (exporter) conducts L/C inspection, if everything is correct, it will
deliver the goods to the importer.
- After delivery, the exporter must prepare a valid set of documents to transfer to
the bank for notification (Advising bank) and attached a set of documents as a
notice of claim. In this step, documents and payment appear so this method is
called "Letter of Credit". Deliver documents and request payment.
- After receiving the documents. Does the notification bank have to check the
valid documents? In voucher credit payment, the documents must comply with
UCP (The Uniform Customs and Practice for Documentary Credits) and ISBP
(International Standard Banking Practice for the Examination of Documents
61
Under Documentary Credits). The following articles I will write about UCP and
ISBP.
- After receiving the documents when step (6) ends, the issuing bank will check
the documents. After the inspection process must notify the test results to the
notification bank.
- After this process, the documents have been in the hands of the issuing bank. If
this document is wrong, the notification bank is responsible for requesting
amendment. If valid, the notification bank is responsible for notifying the
beneficiary (exporter) and payment. When the bank informs that payment has
been made to the exporter. The L/C opening bank will issue payment to the
importer.
- Money will be officially transferred to the L/C issuing bank account. This is
credited to the account of the L/C issuing bank.
Step 2: Prepare merchandise
The work of preparing export goods consists of 3 main stages: centralized
collection into export consignments, package and export signs.
- Centralized collection into export consignments:
The company proceeds to purchase fresh coffee from coffee growing
households in the Central region. After purchasing fresh coffee is put into the process
of producing green coffee such as peeling, drying, screening, etc.
- Package:
Coffee beans to be packed in single jute bags of 60 kg net each, about 60.2 kg
gross each, sewn at mouth with jute twine thread suitable for rough handling and sea
transportation.
- Export signs:
Clearly mark the recipient's name and the sender's name:
 Recipient: Volcafe Joint Stock Company

 Sender: ARMY Coffee Export Limited Company
 Net weight: 60 kg/bag
62
 Packaging weight: 60.2 kg/bag
 Contract number: 424 / HD2019
 Country name, location name of goods to: New York Port, USA
 Country name, location name of goods: Cai Mep-Thi Vai Port, Vietnam
 Special itinerary: trip
 Bill of lading number: YMLUI490073162
 Ship name: EVER POWER: 083B
 Trip: Vietnam - USA
 Signs guiding how to arrange and load goods from production to
consumption
Marking should be bright, clear, not fade, waterproof, paint ink does not affect
goods. In addition, the company must have a certificate of conformity of the goods
with the provisions of the contract.
Step 3: Inspect the item's quality
- Check quantity: 80 20 feet container, 416 bags / container

- Quality inspection: ISO technical standard of natural rubber
- Check weight: 2,000 tons of coffee, packing for rubber products is 60 kg per
bag.
- The inspection and quarantine must be done at two levels: at the facility checked
by the goods quality inspection department and at the border gate by the
import and export goods inspection company, Department of Animal Health
and Animal Protection Department. Plant protection is conducted before
delivery and certification of goods quality.
Step 4: Rent a ship
Company hiring tourist boats
63
- Charterers through brokers require charter ships to transport goods. The
company through Orient Transportation and Trading Joint Stock Company
requires a charter ship to transport goods.
- Ship broker: on the basis of cargo information, the broker seeks the ship and
introduces the ship owner accordingly. The broker introduced it to EVER
POWER: 083B of the ship.
Nationality: Panama
Age: 12 years old
Total tonnage (t): 17.887
Weight (t): 19,309
Length (m): 181.76
Speed (knots) 21.3
- The broker negotiates with the owner about the terms of the charter, such as:
 Commercial conditions: CIF
 Loading and unloading costs: VND 600,000,000
 Time to port: 8 hours in advance, goods are loaded on board
 Ship location: Cai Mep-Thi Vai Port, Vietnam
- The broker contacts the company to prepare for the signing of a charter party.
- Contract signing.
 The source of the law on chartering a charter is national law. There are
provisions in the charter of the charter that if there are disputes arising
out of the contract, it will refer to the British maritime law.
 Before signing the contract, the company must review all terms of the
contract. The two sides will cross out or supplement what has been
agreed as appropriate because the charter train, the model contract only
mentioned the common features.
- The company takes goods to the port to load on board.
- Ship owners or ship agents issue bills of lading. This bill of lading is called a
bill of lading under a charter party.
64
Step 5: Buy insurrance:
- Goods transported on the sea often face many risks and losses. Therefore marine
cargo insurance is the most popular type of insurance in foreign trade.
- Our import and export shippers, when buying insurance, buy at Vietnamese
companies. Insurance policy can be a trip insurance policy. When buying
insurance, the goods owner (ie import-export business unit) signs the contract
from the beginning of the year, and when the goods are delivered to the ship,
the goods owner only sends to the insurance company a written notice called :
"Notice of starting shipping" when buying trip insurance, the goods owner must
send to the insurance company a document called: "Insurance request letter".
On this "Claim Form", the owner and insurance company negotiate to sign an
insurance contract.
- The owner purchases insurance at the value of 110% of the CIF price with a
premium of VND 270,623,122.
Step 6: Customs procedures
The company makes procedures at Hai Phong Customs Department with a fee
of 20,000 VND / declaration
 Customs declaration: 02 originals

 Sales contract: 01 copy
 Commercial invoice: 01 original.
 List of goods details: 01 original, 01 copy
 Export consignment contract (if receiving export consignment): 01 copy;
 The norm of using raw materials of the goods code (if it is processed
goods, exported and only submitted once for the first time of export): 1
original.
Step 7: Delivery goods
65
- Based on the details of the exported goods, set up a register of transport goods
for the carrier (maritime representative or captain or shipping agency company)
in exchange for Stowage plan.
- Discuss with the port regulating agency to master the time and date of shipment.
- Arranging means to bring goods into the port, loading goods on board.
- Obtain a Mates receipt and change the receipt of the mate's bill of lading.
The bill of lading must be the perfect bill of lading, loaded onto the ship (Clean
on board B/L) and must be transferred (Negotiable).
Step 8: Receive payment
- If the export contract stipulates payment by letter of credit, the export business
unit must urge the overseas buyer to open the letter of credit (L/C) on time and
after receiving the L/C, it must check L/C inspection and convenience in
collecting L/C export goods. If L/C does not meet these requirements, it is
necessary to force the buyer to modify it before we deliver.
- When making payment documents, the important points to be thoroughly
understood are: Quick, accurate, in accordance with the requirements of L/C in
both content and form.
66
CONCLUSION
Foreign trade skills are useful subjects for business managers, businesses as
well as those interested in foreign trade. The course helps us to have better vision
and skills in foreign trade. The course specifically instructs businesses on how to set
up an export business project.
Setting up an export business project is an essential task. The business planning
process is very useful for coordinating activities among departments in the enterprise
to coordinate with each other to assess, review, select suitable partners for export
and make plans operating for businesses in a more objective and comprehensive
way.
We thank teachers for equipping me with the basic knowledge of foreign trade
economics in general, foreign trade techniques in particular and the dedicated
guidance of Mrs. Bui Thi Thanh Nga who helped us to complete the project this
subject. With what we learned in class and our ability to find things to complete the
project, our group tried to finish it in the best way possible. However, besides that,
it is impossible to avoid the shortcomings in the process of making lessons. The
group is looking forward to receiving comments and enthusiastic instructions from
the teachers so that the group can understand the errors in the process of making
lessons and understand the subjects better.
We sincerely thank you!
67
REFERENCES
1. Mr. Doan Trong Hieu, Curriculum of International Trade Transactions,
Hang Hai Publishing House, Hai Phong, 2017.
2. Monthly Coffee Market report-June 2018
3. General Department of Customs.
4. International Coffee Organization, United States Department of Agriculture.
5. Bloomberg, Vietnamplus, Cafef.
6. Tay Nguyen News, Gia Lai News, Thanh Nien Magazine.
7. Thitruongcaphe.net, dankinhte.vn, intimexhcm.vn, giacaphe.com
68

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TABLE OF CONTENTS

ACRONYMS LIST ...................................................................................... III

CHAPTER1: INTRODUCTION ................................................................... 3

1.1 INTRODUCE ABOUT THE COMPANY ........................................................... 3

CHAPTER 2: THE EXPORT PLAN .......................................................... 15

2.1 LEGAL BASE FOR EXPORTING. ................................................................. 15

ACB Asia Commercial Joint Stock Bank

ISO International Organization for Standardization

HACCP Hazard Analysis and Critical Control Points

BRC British Retailer Consortium

HSBC Hongkong and Shanghai Banking Corporation

NPD National Purchase Diary

TPP Trans-Pacific Partnership Agreement

EVFTA Economic Vietnam Free Trade Area

FDA Food and Drug Administration

TTR Telegraphic Transfer Reimbursement

Number Table name Page

Table 1.1 Revenue of ARMY Coffee Export Company

3 Table 1.3 Specification of the coffee beans 11

5 Table 2.1 Compare prices of green beans market 17

6 Table 2.2 Compare prices of domestic competitors 18

Table 2.3 Export Turnover of coffee’s company in

12 Table 2.8 Export freight costs 44

13 Table 2.9 Expenses for export of goods 45

14 Table 2.10 Summarize the cost of export shipment 46

16 Table 2.12 Market Factor Assessment 49-50

Number Diagram name Page

Diagram 1.1 Diagram of enterprise organization

2 Diagram 1.2 Production process of the coffee beans 12

3 Diagram 2.1 The process of implementation 60

Number Chart name Page

(Source: Overview for ARMY Coffee Export Limited Company in 2018)

Moisture 12.5% max 13.0 % max 12,5% max

Foreign matter 0.5% max 1.0 % max 0.3% max

Broken 2% max 5% max 3% max

Black bean 2% max 5% max 3% max

Expiry Date April 2022 April 2022 April 2022

Collecting and preservating materials

Dry milling, Polishing

Diagram 1.2 Production process of the coffee beans

Table 2.1 Compare prices of green beans market

Table 2.3 Export Turnover of coffee’s company in Intimex Group 2017

1 Intimex Group Joint Stock Company 806,658,455

MTV Export and Import 2/9 Dak Lak Limited

3 Intimex My Phuoc Joint Stock Company 160,714,928

Louis Dreyfus Company Vietnam Trading and

5 Atlantic Vietnam Trading Limited Company 143,562,191

6 Tin Nghia Corporation 128,278,350

7 Mascopex Joint Stock Company 111,394,280

8 Phuc Sinh Joint Stock Company 110,472,823

9 Vinh Hiep Limited Company 96,716,773

10 Intimex Dak Nong Joint Stock Company 76,857,874

Table 2.5 Coffee import quantity of the US in 4 years 2015-2018

Colombia Brazil Other Countries Viet Nam

Serial Country Proportion (%)

3 Other Countries 15.8

To: Volcafe Joint Stock Company

 Robusta Coffee Beans grade 1: 500 MT (more or less 3%)

Moisture: 12.5% max