Do you think it’s impossible to compete with McDonald’s, Starbucks, Coca-Cola, or Home Depot? Think again. The reality of globalization combined consumers’ desire for localization allows your company to not only grow but compete with the largest companies in the world
In the late 1970s, my father and mother became aspiring entrepreneurs. They faced extreme challenges, but also unique opportunities. This exciting, albeit uncertain, time drove both my parents to create a successful business for themselves and their family. Today, the company they started, Tân Hiệp Phát (THP), is Vietnam’s largest family-owned manufacturer in the Fast-Moving Consumer Goods category (FMCG), employing more than 5,000 staff members nationwide. We have a fifteen to twenty percent domestic market share, ranking alongside multinationals such as Coca-Cola and Suntory. In terms of the healthy beverages sub-sector, THP leads the pack with a fifty percent market share.
How does someone go from a good business idea to a viable company, and, over time, to a national, regional, or global champion? My family was governed by the following key principles in order to achieve THP’s regional dominance and global presence:
- Create Authentic Local Products – Authentically local products are tough to beat. These products dominate because they are the only ones that truly deliver on the four basic principles of successful marketing: product, price, promotion, and place for a specific market. Truly local products know their target markets intimately and, as a result, the product provides what is actually desired. These products are priced appropriately, the message for selling them speaks to the right audience, and the places that offer the product make sense to the consumer. Multinationals often fail to achieve in this space because they regard these details as nuisances.
- Adhere to International Standards – When a company says it is working to international standards, it is generally referring to ones that have been tried and tested by global market participants and are accepted as industry benchmarks. The best known are the ISO (International Organization for Standards) commercial and industrial standards. These standards help third parties understand what stage a company has reached or the quality of what it offers. Regardless of its current scope or reach, adopting these best practices will only make your company better in a number of areas including sourcing, production, and distribution.
- Govern Growth – Many small companies want to become bigger ones, but one of the most important lessons they need to learn is to not focus solely on growth. If they do not put the right IT systems and operational procedures in place to control it, they are very likely to run into serious issues as they scale up. Companies of all sizes must recognize the importance IT will play in their growth. Improperly implementing technology, or not recognizing the need for it, will result in time, resources, and opportunities lost.
- Motivate Employees and Foster Community Spirit – Culture is a significant component of a company’s success. When employees successfully interact with each other, senior management, and the organization’s customers, companies can establish, communicate and instill core values. The successful implementation of these values and priorities becomes more and more important as a company grows. In my next post, I’ll specifically address how THP established a company culture that has ensured long-term success.
- Take Responsibility – All human beings are a work in progress. We all make mistakes, and my family is no exception. One of the most significant lessons we have taken to heart is learning to manage ourselves in order to provide leadership for everyone else who works at THP. To help us as a family, we created a family mission statement with a set of core values – just like our company. This allows us to regularly re-visit the values and priorities that matter to us. Additionally, our family’s core values serve as a foundation of clear communication from one generation to another. These values guide family meetings and remind us of what we want to accomplish, how we want to accomplish it, and our individual responsibility in achieving those goals.
Our adherence to these five guiding principles led to THP’s success and the company it is today. They are fundamentals that will help any family business—regardless of size—achieve greater success and growth. Learn more about these five principles and our story by getting your own copy of, Competing With Giants which can be purchased here.
First featured on Forbesbooks.com