Consumer Taste Surveys Needed to Penetrate French Market

11:05:07 PM | 6/4/2011

"For successful penetration, as well as to improve competitiveness in a large market like France, Vietnamese enterprises need to equip themselves with knowledge about legal, economic, and cultural aspects of the market." This is the recommendation of Mr Olivier Monange, Representative of DS AVOCATS Law Firm in Vietnam, at the Workshop on "French Market- Opportunities and Practice” held by VCCI - HCM in coordination with the French Chamber of Commerce and Industry in Vietnam (CCIFV).
The 5th largest economy in the world with a population of 65.8 million, France is considered a great potential market. The French market is appreciated by foreign investors for economic and political stability. The labour force in France is the world leader on productivity and attractive tax policies. It also offers a stable investment environmental, with profitable investment in real estate, tourism, food industry, pharmaceuticals, cars, and the airline industry, and support for foreign investors, France has policies that allow foreign enterprises to operate, recruit local workers; and allow people with qualifications to be settled in France for 10 years along with family. Also there is support in taxes; it is estimated that over 50 percent of business taxes are entitled to exemption.
In his opening speech for the seminar, Deputy Director of VCCI HCM, Mr Nguyen The Hung said, "With the flexible economic structure, Vietnam can be a bridge for French goods to penetrate the ASEAN market. In contrast, France is also an important partner, the gateway for Vietnam goods to access the EU and North Africa." As can be seen in recent years, cooperation between Vietnam and France has achieved outstanding development and still has great promise. France is ranked the 3rd biggest partner of Vietnam (after Germany, UK). Two-way trade in 2010 reached EUR3 billion, up 20 percent compared to 2009, of which Vietnam exports to France reached EUR1.32 billion, up 9 percent compared to 2009. Some export products to France have grown significantly such as: footwear (17 percent), textiles (4.5 percent), and household goods (10 percent). Particularly, seafood, considered the most potential item of Vietnam’s exports to France, saw turnover increase in 2010 of 34.24 percent.
Mr Jean Pierre Malgouyres, President of CCIFV, affirmed that Vietnam has long been a high potential partner of France. To help strengthen this relationship, CCIFV will increase support for Vietnam enterprises to penetrate the French market as well as create favourable conditions for French enterprises to expand their activities in Vietnam, enacting the slogan "cooperation for mutual development." 
Mr Nguyen Duc, Regional Director ASEAN (“Invest in France” Organization), shared that, along with other countries, the French market has strong appeal for Vietnamese enterprises. However the biggest barriers for Vietnamese enterprises to penetrate the French market is mastering the process and procedures for investment registration and meeting the standards of this market. In order to successfully conquer this market, Vietnamese enterprises need a method to access information on: business venture opportunities with French enterprises, legal procedures when developing projects in France, logistics problems in import and export of the French market, tax and customs procedures, and commercial contracts.
Agreeing with Mr Duc, Mr Olivier Monange said to export successfully to the French market, Vietnamese enterprises need to equip themselves with understanding of legal, economic and cultural aspects of this market. Specifically, businesses need to visit the French market, learn about the criteria and characteristics of the market as well as consumers' tastes. Especially, Vietnamese enterprises must note three issues. First, when exporting products to France, they need information about the customs and tax regimes. Second, businesses have to determine the distribution channel for their goods in France that will be processed through a form of contract with a professional distributor or through sales agents; then specify in the contract which court, which Arbitration Centre, to select and choose which country’s laws would handle cases of disputes. Finally, for Vietnamese enterprises that have a certain position in the French market, if they want to further enhance their presence, they may establish a French base in the form of opening a representative office, branch or set up a joint venture with French companies. However, Mr Olivier Monange encouraged enterprises to set up representative offices or subsidiaries, but not to set up branches because of costly, burdensome procedures, while the scope of taxable income is not clear which can cause trouble later on.

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