ASSIGNMENT COVER SHEET

UNIVERSITY OF SUNDERLAND
BA (HONS) BUSINESS MANAGEMENT

Student ID: 189151245

Student Name: NGUYEN THI XUAN HAU

Module Code: SIM 336

Module Name / Title: Strategic Management

Centre / College: TEG Danang

Due Date: 12th April 2019 Hand in Date: 12th April 2019

Assignment Title: Strategic Analysis of Highlands Coffee in Vietnam

Students Signature: (you must sign this declaring that it is all your own work and all sources of
information have been referenced)
 Word count

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• Cover page

• Table of content

• Appendix

• Bibliography
Introduction
In recent years, the coffee market in Vietnam has become more vibrant than ever when there are
a series of brands both at home and abroad, but it can be said that Highlands Coffee is still the
most familiar name with nearly 20 years of history accompanying Vietnamese coffee culture.
With nearly 300 shops in 21 out of 63 provinces and cities of the country, appearing in most
buildings and commercial centers; Highlands Coffee has perhaps the most successful coffee
chain in Vietnam today. In addition to the basic business strategy, that success is also nurtured by
love, as well as the understanding of psychology and taste of Vietnamese people. All are not out
of steadfast goals: Serving Vietnamese coffee for every Vietnamese, anytime, anywhere. The
purpose of this report is to apply relevant strategic models and concepts and compare with the
practices of Highland coffee, Vietnam. The most relevant models are found to be analysis of
Hi`ghlands’ policy and strategic management through SWOT and Porter Five Forces models.

Company background
From the love to Vietnam and the passion of coffee, in 1999, the brand named Highlands Coffee
was born with the passion of raising the café heritage of Vietnam and spreading the spirit of Viet
pride, connecting harmoniously between tradition and modernity. Originating as a packaged
coffee business in Hanoi in 2000, Highland coffee has quickly grown into a chain of well-known
coffee shops that have been expanding throughout Vietnam and abroad since 2002. Over the
time they have become famous for consistently delivering delicious and aromatic Vietnamese
coffee in a modern and comfortable environment that reflects the appeal of modern Vietnamese
life. Today Highland coffee continue to hand select the finest beans that are roasted fresh daily
and served with a smile. Great Cafe - Great Product - Great Service at an affordable price is the
secret of their success.

Finalize models/theories

1/SWOT analysis
SWOT analysis model is a strategic management tool that evaluates strengths (Strength),
weaknesses (Weakness), opportunities (Opportunity) and threats (Threat) related to businesses in
the internal and external environment.
SWOT analysis of Highland coffee brand considers the strengths and weaknesses (internal
strategic factor) that appear in the process of operating coffee products, coffee shops and related
industries. This analysis also to mention opportunities and threats (external strategic factors)
related to the competitive environment. A competitive environment like the coffee industry will
require the company to continuously improve its business strengths to optimize financial
operations and sustainable development.

 Strong brand equity

S 



Quick service
Use material coffee in Vietnam
Good location with beautiful view
New style of mixed culture between the West and the
East
 Consistency in Western identical decoration and
delivery service
 Highlands coffee shops located at central of city or
trade centers
 It looks so premium that many customers seem

W 


reluctant to enter while they can afford
Western style need time to be suitable for Vietnamese
lifestyle
Highlands coffee is rather expensive due to high cost
in materials and operating system
 Highlands coffee doesn’t focus much on promotion
campaign
  There are not many coffee stores professional in style

O 
and service
Vietnamese people habit is to go to cafeteria for their
business

 Coffee market is now matured and fiercely

T 
competitive
Most building in cities have already had at least one
cafeteria inside, it’s difficult for Highlands to jump in
and replace
 It’s difficult for outdoor coffee stores like Highlands
to attract customers in cold winter.
 There are many competitors with Highland coffee
such as The Coffee House, Starbuck, The Cup coffee
and other competitors.

Here Commented [AK1]: Can you conclude, what is your conclusion

from SWOT analysis?

Porter Five Forces analysis

Porter’s five forces model is an analysis tool that uses five industry forces to determine the
intensity of competition in an industry and its profitability level. Five forces model was created
by M. Porter in 1979 to understand how five key competitive forces are affecting an industry.
This model provides competitive strategies for businesses to maintain or increase profits. The
enterprise often uses this model to analyze whether they should join a particular market, or
operate in a particular market does not. (SMI, 2010)
 Figure 1 Porter's five forces model

 Threat of New Entrants: Moderate

 Bargaining Power of Buyers

In the process of moving to a market economy with the fierce competition of competitors and
the trend of international economic integration, trade liberalization; enterprises need to pay
more attention to identify their customers. Highlands Coffee customers have been serving
middle-class consumers, offices and young people. Drinking coffee here is also felt by
customers that they belong to the upper class or high-class customers who cannot drink
coffee in a normal non-brand store, they have to drink at Highlands Coffee - a prestigious
brand, in part to confirm their class.

Things to do Commented [AK2]: 1.You need to specify/apply: 5 forces:

High. High- Medium, low
2. Apply another model: JIT
a.Supplier-> Highlands
b.Highlands-> Customer
3. Recommendation and Conclusion