2.

Industry Analysis and Market Research (8 points):

general analysis of the Pangasius export industry

Number of competitors + Market type (draft) :

Regarding the market structure, the Vietnam Pangasius fish market is a competitive market with
monopolistic competition, mainly coming from other Pangasius companies such as VINH HOAN
CORP, and ANVIFISH Co.
Not only competing with competitors in the same field, Hung Vuong Corp must compete with other
seafood companies that produce catfish as substitute products.
Pangasius in Vietnam is a potential market with a market size of nearly 435 active companies
recorded in 2022. With an export turnover of 1.5 - 2.4 billion USD/year, pangasius alone accounts
for 16-26% of Vietnam's total seafood export value. The growth rate of Vietnam's pangasius market
also recorded major changes from 2017 to 2022. Although the area of pangasius farming tends to
decrease, fish production gradually increased from 1.2 million tons in 2017 to 1.7 million tons in
2022, showing that pangasius farming productivity is increasingly improving. (VASEP)
Among exported products, frozen pangasius fillets have accounted for the largest proportion of total
pangasius exports in recent years. By 2020, this product accounts for 89 - 90% of Vietnam's total
pangasius export value. As of 2022, Vietnamese pangasius has successfully exported to more than
140 markets worldwide. Including markets that are strict on food safety such as the US and Japan.
(VASEP)
https://vasep.com.vn/san-pham-xuat-khau/ca-tra/tong-quan-nganh-ca-tra

Entry barrier: (vietluat)

https://vietluat.vn/dieu-kien-thu-tuc-thanh-lap-cong-ty-xuat-khau-thuy-san.html
Many obstacles make it difficult for new firms to enter the pangasius export industry, for example:
Capital and regulation requirements : (Fixed cost)
Location of aquaculture facility construction:
+) Comply with regulations on land and sea area use for aquaculture according to the law.
+) Facilities and technical equipment are suitable for the subjects and type of farming.
+) The plans and activities meet the provisions of the law on environmental protection,
veterinary medicine and labor safety, and the provisions of the law on food safety.
+) Registration is required for cage aquaculture and key aquaculture species.

https://mof.gov.vn/webcenter/portal/vclvcstc/pages_r/l/chi-tiet-tin?dDocName=MOF152805
 Access to distribution channels : (Sunk cost)
Pangasius export still faces many challenges because:
+) Technical barriers (traceability, antibiotic residues, microorganisms...)
+) Trade barriers (anti-dumping tax of the United States, red label of the World Wide Fund for
Nature...) along with the impact of macro policies (tax, currency...).
Besides, trade promotion and pangasius branding have not been invested properly => delay =>
more fee

 Expertise and reputation

 Brand loyalty and recognition

- Rate the potential of product substitution (why/ why not)

https://www.jstor.org/stable/10.5950/0738-1360-27.4.359
A non-linear AIDS model was used to estimate substitution patterns across seafood categories at the
US retail market level. Results indicate that demand for catfish, crawfish, clams, and salmon
products is elastic, suggesting that consumers are sensitive to price changes. In contrast, demand for
 shrimp and tilapia, mostly imported products, is price inelastic. (citing)
This proves that businesses need to change to suit the needs of international consumers

- How do all these factors shape the competitiveness of the industry, Hungvuong’s position in the
industry?
Used to be the leading enterprise in the Vietnamese pangasius industry, HVG borrowed capital to expand,
which increased the company's liabilities. Especially during the period when HVG's outstanding debt increased
sharply in the period 2013-2016, mainly short-term bank loans. Large debt leads to high-interest costs and
erodes company profits. As a result, HVG's profit after tax has dropped, and in 2019 the company reported a
loss after tax of up to 1,123 billion VND. With those difficulties, HVG is gradually losing its leading position in the
pangasius export market
(https://cafef.vn/hung-vuong-hvg-bi-dinh-chi-Giao-dich-tu-vua-ca-tra-voi-thi-gia-an-dut-vinh-hoan-den-su -
sup-do-trong-chop-mat-do-no-bom-vay-no-20230306135213493.chn)