Sohaco Rising to New Heights

Could you please tell us the operating results of Sohaco in the past time? And could you share some of the practical experiences of Sohaco?

Many domestic companies were fraught with difficulties, loss-making operations and even facing bankruptcy due to global economic crisis from 2008 to 2013 but Sohaco still managed to withstand, develop and maintain an annual revenue growth of 25-30 percent. Particularly, in 2013, Sohaco’s revenue increased 25 percent to VND1,300 billion, tax payments to the State Budget leaped 20 percent, and payrolls soared 20 percent. All central tasks are completed and surpassed. Those remarkable achievements prove the huge endeavours of the entire Sohaco staff.

 

We have drawn a lot of experience from our business operations, especially in 2013. We must be persistent in sustainable development approaches. We must develop core strengths, that is distribution system, distribution services and product quality, invest to expand production and business activities of core business fields. We must establish and carry out strict risk management plans, better manage customer debts and inventories, and keep close track of exchange rate fluctuations. At the same time, Sohaco focuses on building high-quality human resources, building corporate culture and exercising corporate social responsibility. Sohaco has achieved positive results in building and developing exemplary units. Sohaco North - a member company - is currently the leading bird of Sohaco. For unit members in trouble, Sohaco focuses on supporting them to overcome difficulties. In 2013, Sohaco assisted Medisun Pharmaceutical Joint Stock Company to achieve 50 percent growth and to start making a profit. The company also keeps updated macroeconomic policies of the government and of the pharmaceutical industry that may affect the company’s business operations to promptly adopt flexible measures to overcome difficulties or seize opportunities to develop business.

 

One daunting difficulty is the human resources are not enough to meet the development requirements of the company. Sohaco lacks experts with strong passion to move forward with the company. The company has not been able to build the development strategy and long-term, medium-term management strategy to make Sohaco a leading pharmaceutical enterprise in Vietnam from 2020 to 2025. Insufficient macroeconomic policies affect our company’s development.

 

Firstly, TPP will make the competition among pharmaceutical manufacturers in Vietnam fiercer. Currently, Vietnam's pharmaceutical industry is hardly able to build its own input materials. China and India, which are not engaged in TPP, are major suppliers of inputs for the Vietnamese pharmaceutical manufacturers; this will be tough for Vietnamese companies.

 

Secondly, Vietnam now mainly imports pharmaceuticals as domestic production fails to meet the demand. Its export is also limited. It will be very difficult for them to upgrade product quality to meet import specification and quality requirements of TPP countries due to limited technologies and human resources.

 

However, there will be great opportunities for Vietnamese pharmaceutical manufacturers as well as other businesses. They can attract more foreign investment capital or set up joint ventures with foreign firms when TPP takes effect. To seize opportunities and deal with challenges when Vietnam joins TPP, Sohaco, like many other businesses, must focus on improving internal competitiveness, such as product quality, packaging and human resource quality, increasing investment for product research and development, and marketing activities. Particularly, it will constantly improve the efficiency of distribution systems because, like when it entered the WTO, Vietnam still preserves the rights of pharmaceutical distribution when Vietnam signs into TPP. Foreign companies are not allowed to directly distribute medicines in Vietnam.