The electric wire and cable market is a real "battlefield." In that fiercely competing environment, Cadivi has powerfully emerged to be a leading electric wire and cable producer in Vietnam and in Southeast Asia as well. How Cadivi has risen up to the current size remains an unknown to most people. To learn more about development strategies of this leading brand name, especially its plans to conquer the Japanese market, Vietnam Business Forum interviewed Mr Nguyen Loc, CEO of Cadivi. Thanh Tam reports.
Could you briefly introduce major achievements of Cadivi in 2013?
Last year, like many other companies, Cadivi also faced many difficulties. But with tireless efforts of the entire staff, Cadivi achieved encouraging results. Revenue rose 31 percent year on year to VND4,500 billion, net profit reached VND170 billion as planned, and dividend payout was 30 percent.
Not only to maintaining the market share, Cadivi-branded electric cables and wires are gaining increasing trust of consumers and becoming a favourite choice for electrical works of national importance. And, to confirm the substantiation of Cadivi product quality, the Council of Vietnam Enterprises Institute granted the "Trusted Quality Supplier 2013" certificate to Cadivi. With this certification, Cadivi is ranked among companies with highest brand creditability, product quality and customer satisfaction. The company always sticks to sustainable competitiveness development in accordance with the TQS (Trusted Quality Supplier) assessment process. In addition, we also honoured with the "For the development of ASEAN community" award as well as many other certificates and awards of quality.
Cadivi always embraces the operating philosophy of "sustainable growth, cost price reduction and guaranteed product quality." However, coupled with current economic difficulties, many companies are bemoaning input cost increases. In this context, has Cadivi adopted any solutions to keep product prices stable for customers?
Cadivi understands and empathises with difficulties of Vietnamese consumers. In addition, our pricing strategy is also a competitive advantage against our competitors. Although our profit margin has trimmed down in recent years, we have always stuck to our development direction set from the early days of operation: Keeping prices stable to share difficulties with clients.
The strength of Cadivi’s products is affordable price and premium quality. Cadivi can do this because we deem pricing as a long-term strategy. Instead of raising prices, which may deprive of the opportunity of using Cadivi products by low-income consumers, we have applied very strict rules to reduce costs in all phases, from material sorting to product distribution and circulation. Specifically, we focus very much on applying scientific and technical advancements and using state-of-the-art technologies to reduce input consumption, enhance productivity and improve product quality. With this approach, in 2013, Cadivi saved VND28 billion - a record value, which helped boost productivity, stabilise prices and increase profit. As Cadivi’s products are made with least costs, we can fully supply the market with products of stably competitive prices and high quality.
Advantages and strengths helped Cadivi achieve impressive indicators in 2013 - a very tough year for the business community. So, besides favourable conditions, did Cadivi encounter any difficulty?
Our difficulties mainly come from poor-quality imports, counterfeits and products of unclear origin. Unfair competition caused our market share to shrink and forced us to consider exporting. Besides, to boost sales, we do not increase selling prices and focus on developing new products with high competitiveness like underground medium-voltage cables. With one step ahead of the industry in underground middle-voltage cables, Cadivi quickly occupied the market, starting in Ho Chi Minh City.
To qualify for export to demanding markets like the US and Japan, how has Cadivi focused on building and maintaining quality management system?
We always maintain quality policy as it is decisive to Cadivi product branding. In addition to the ISO9001:2008 quality management system - the backbone quality system of the company, Cadivi has also applied other advanced quality management systems like TQM (Japan), 5S, Balanced Scorecard.
Besides, Cadivi always turns out products meeting both Vietnamese and international standards like Vietnam’s TCVN, the US’s UL and Japan’s JIS to meet all requirements of customers and keep up with requirements of international integration process.
As for the Japanese market, Cadivi has certain advantages like technical assistance and cooperation from Japanese partners. Hence, the company can meet their requirements - globally known for fussiness and perfection.
With good traditional business relations with Japanese partners, in 2014, will Cadivi carry out any activities and programmes to boost cooperation with these potential partners?
Firstly, we will actively respond and participate in the Vietnam - Japan Economic Forum to better understand the cultures and peoples of the two countries.
Secondly, we will strengthen cooperation with Japanese partners and bring more Cadivi products into construction projects of Vietnam and Japan. And, to prepare for this important step, we have been in contact with representatives of the Toshiba Corporation, Thai Binh Thermal Power Company 1, Thai Binh Thermal Power Company 2, and others.
Thirdly, Cadivi will proactively approach Japanese companies in Vietnam to export its products to Japan. And, to facilitate this step, in 2014, Cadivi will set up a sales office in Japan to capture and access opportunities, effectively solve emerging problems and create confidence of Japanese partners.
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