A study of factors affecting the collaboration in Vietnam exported fruits and vegetables supply chain

mporter) are always open-minded and never conceal their business objectives (TRU1), our counterparts always have positive altitude in mutual agreements (TRU2), we believe that our counterparts is honest (TRU3), components in the chains always respect each other (TRU4), counterparts always care about our problem (TRU5). When exporters believe in food hygiene, safety and quality of growers and are aware of its importance to health and purchase decisions of consumers, they will certainly cooperate with farmers to build that trust, so: H1: There is a positive relationship between trust and collaboration in Vietnam exported fruits and vegetable supply chain. 1.3.2.2 Power When designing a cooperative supply chain with other enterprises, the business, itself, has to consider the scale, effect and status of other enterprises. Researches about power pointed out the elements in the power scale including: The components in the chain share equal power when making decision about the activities of the chain (producing, distributing, selling, researching and developing) (POW1), both the supplier and the importer have influence to our decision (of producing, distributing, selling, researching and developing) (POW2), we have influences to partners’ decision (producing, distributing, selling, researching and developing) (POW3). The power between the parties will influence the decisions on activities in export fruits and vegetables supply chain, namely the greater the influence between the parties is, the more regularly they will have to contact to work and exchange together. This leads to the following hypothesis: H2: There is a positive relationship between power and collaboration in Vietnam exported fruits and vegetable supply chain 1.3.2.3 Commitment Cooperating commitment is defined as the range of which partners in the supply chains will maintain and stimulate their business relationships. Researches about cooperating commitment showed out the scale including: the components are expected to maintain the business relationship (CMM1), the components are willing to enrich and extent the relationship with their partners (CMM2), we spend lots of time to build up the relationship with other partners (CMM3), we invest a subsequent amount of budget into building up relationship with other partners (CMM4), the relationship with partners is more important than short-term interest (CMM5). Commitments play a very important role in developing collaboration in the supply chain. Therefore: H3: There is a positive relationship between commitment and the collaboration in Vietnam exported fruits and vegetable supply chain. 1.3.2.4 Culture Culture commonesses is defined as the range of which partners in the supply chain have value, belief and managing methods that is in common with each other. Researches about culture commonesses describe the element in this scale including: we have culture in common (about languages, desires, habits) (CUL1), we could easily understand the term and business method of our partners (CUL2), we always agree with solutions to handle difficulties and hardship of our partners (CUL3). Cultural similarity also facilitates inter-organizational cooperation (Melvor and Humphreys 2002). Therefore: H4: There is a positive relationship between cultural similarity and collaboration in Vietnam exported fruits and vegetable supply chain. 1.3.2.5 Business strategy Business strategy compatibility is defined as the extent to which supply chain partners have clear and agreed business strategy goals. Studies of business strategies have also shown that the components of the scale include: The components of the chain jointly develop common business goals for the export fruits supply chain (BS1), the components of the chain is highly in agreement about the common business goals of the export fruits supply chain (BS2), all members of the chain understand the partners's business goals (BS3), all partners understand their rights and obligations in the operation of the export fruits supply chain (BS4). Sharing common business strategies will serve as a guideline for cooperation activities between partners and facilitate integration and use of resources (Wathne and Heide 2000). Therefore: H5: There is a positive relationship between the compatibility of business strategy and collaboration in Vietnam exported fruits and vegetable supply chain. 1.3.2.6 Government support In the complicated and extensive operations of the supply chain, there is a need to enhance cooperation between businesses and governments, national and international, to control and manage risks effectively in global supply chains. Studies of government support have also shown that the components of this scale include: The Government of Vietnam has implemented policies and special projects to support our company (GS1), the Vietnamese government gives the necessary information on time (GS2), the Vietnamese government provides financial support to our company (GS3), the government supports other resources for our company (GS4). According to Mentzer, 2001, it is difficult to cooperate with any actors who want to participate in the supply chain in the industry but do not meet the national and international policies and laws. Therefore: H6: There exists a positive relationship between government support and collaboration in Vietnam exported fruits and vegetable supply chain. 1.3.2 The original research model From the above-mentioned assumptions, the research model consists of six factors (six independent variables) that all positively affect the collaboration (dependent variable) in Vietnam exported fruits and vegetable supply chain. 1.4 Experience in developing cooperation in the export fruits and vegetables supply chains of India and Thailand 1.4.1 Experience of India The dissertation introduces the general export of Indian vegetables and fruits and the cooperation in the Indian export vegetables and fruits supply chain. From there, draw lessons for Vietnam. Firstly, for the farmers, they have formed the link through the group of vegetable farmers thanks to the intermediaries of distribution and government support policies. Second, the signing of production contracts. Thirdly, intermediary retail organizations have promoted their role very well. Fourth, the Indian government has well performed its role of supporting and promoting production as well as domestic consumption of fruits and vegetables. 1.4.2 Experience of Thailand The dissertation provides a general introduction about Thai fruits and vegetables export and the cooperation in Thai fruits and vegetables export supply chain. From there, draw lessons for Vietnam. Firstly, sharing goodwill information among the components of the export vegetables and fruits supply chain. Second, promoting the supporting role of associations. Third, exporters focus on developing a collaborative relationship between the components of the exports vegetable and fruits supply chain. CHAPTER 2: RESEARCH PROCESS AND METHODOLOGY 2.1 Research process 2.1.1 An overview of the research process flowchart The research process of the thesis consists of 6 steps, namely: identifying research objectives, collectiong and reviewing documents, collecting research data, preliminary research, formal research, research result’s report. 2.1.2. The steps in the research process This study clearly explains the activities and purposes of each step in the research process of the research. 2.2 Secondary research data Secondary data was collected through field research by reviewing data from published data sources. Its included reports from The General Statistics Offices, Vietnam Frui and Vegetable Association, Information Center of the Strategic Policy Institute for Rural Development and Vietnam Chamber of Commerce and Industry (VCCI) The secondary data is analyzed base on the qualitative analysis methods, including general and matching methods, logical reasoning methods and statistical and modeling methods 2.3 Primary research data 2.3.1 Qualitative analysis methods Group discussion The purpose of this method is to guide factors that influence collaboration in Vietnam’s export fruits and vegetables supply chain, developing scales for these factors to conduct expert interview. Expert interview The expert interview aims to evaluate the contents of the influencing factors and the scales for official quantitative research, as well as preliminary assessment of the level of collaboration in Vietnam’s export fruits and vegetables supply chain. 2.3.2 Quantitative analysis methods The thesis used questionnaire survey in order to point the model of theoretical research, and make assessments and propose solutions. This research uses random sampling and propose-sampling techniques to be conducted for exporters and cooperatives in Vietnam exported fruits and vegetables supply chain. The formal questionnaire has 29 items including 24 items for the scale of factors affecting supply chain collaboration, and 5 items for the dependent variable. Each question item was graded on a Likert scale from 1 to 5 with the convention of strongly disagree (1) to strongly agree (5). The content of the scales was combined by the author from the published research, then translated into Vietnamese and discussed with the group of enterprises who participating in in-depth interviews to adjust some concepts accordingly. The thesis built a questionnaire to survey enterprises producing and exporting fruits and vegetables, cooperatives and conducted surveys at 138 enterprises and cooperatives in regions of Vietnam. The data will be cleaned, coded for quantitative analysis using SPSS 20.0 Testing the scale of Cronbach’s Alpha: This test allows assessing the reliability of establishing a composite variable on the basis of many single variables Exploration factor analysis method (EFA): This method used to test the convergence of conceptual component variables. Exploratory factor analysis is useful in indentifying necessary variables for research issues as well as for finding relationship between variables. Pearson correlation test method: This method is used to check the linear correlation between dependent variable and independent variable. Multivariate linear regress analysis: This method helps clarify the relationship between independent variables and dependent variable in the research model. CHAPTER 3: ANALYSIS THE FACT OF FACTORS AFFECTING THE COLLABORATION IN THE VIETNAM EXPORTED FRUITS AND VEGETABLE SUPPLY CHAIN 3.1 The Overview of the Vietnam vegetable and fruit production and export. 3.1.1 The fact of the Vietnam vegetable and fruit production. Vietnam has the advantage of climate and soil conditions with over 70% of the population working in agriculture and above 1.5 million hectares of area for vegetable cultivation. However, Vietnam's vegetable and fruit exports in 2018 reached about 3.52 billion USD, accounting for a very small share of the total global vegetable and fruit trade of nearly 1,000 billion USD, not to mention the domestic market of more than 90 million people with the growing demand. Moreover, the trend of high technology investment in the agricultural industry grows more and more strongly. Until September 2019, the vegetable cultivation area nationwide reached nearly 980 thousand hectares and increased 1.8% with yielding about 172.2 quintals / ha. The Vietnamese vegetable structure is diverse and plentiful with the current large-yield vegetables such as choy sum, cabbage, cucumbers, corn, water spinach and some spice vegetables such as onions, garlic, etc. Regarding fruits, the area of fruit cultivation of the whole country in 2018 reached 923.2 thousand hectares, an increase of 4.4% compared to 2017, mainly increased in fruit trees such as oranges, grapefruit, dragon fruits, papaya ... 3.1.2 The fact of the Vietnam fruits and vegetables 3.1.2.1 Vietnam's export turnover of fruits and vegetables Vietnam's export turnover of fruits and vegetables continuously increased by about 30% compared to the previous year as of 2017, and then increased by about 10% in 2018. Especially export turnover of fruits and vegetables in 2017 increased by more than 40% compared to the previous year in 2016. It was the first year that vegetable and vegetable export turnover surpassed crude oil and rice and was among the Top 5 items with export turnover of over 3 billion US dollars. In 2019, however, the export turnover of vegetables and fruits decreased in three consecutive months (from May to July) with the decrease of 23.1%, 21.8% and 11% in turn (Nhat Ha, 2019). It was considered as the temporary situation because China ended the Vietnam's quota export and changed into the official one from June 1, 2019. 3.1.2.2 Structure of Vietnam's fruits and vegetables In particular, fruits are the main export products, accounting for the highest proportion in the structure of Vietnam's exported fruit and vegetables, and followed by the other products including flowers, processed products, fresh vegetables and leaves. 3.1.2.3 Structure of Vietnam’s export market of fruits and vegetables Regarding the export markets, Vietnam's vegetables and fruits have been exported to more than 60 countries and territories until March, 2019. The main export markets for fruits and vegetables of Vietnam are China, followed by the US, South Korea and Japan, which are also the main export markets of Vietnam. 3.2 The components of the Vietnam exported fruits and vegetable supply chain. The thesis has pointed out the structure and the fact of each component in Vietnam exported fruits and vegetable supply chain. It has started to invest on farmers or made the contract with farmers in charge of carrying out the segments of production including seed selection, fertilizer, harvesting and preliminary processing. After that, traders usually buy from farmers in the same area and move to processing enterprises or small traders in the purchasing centers or wholesale markets or export and trade enterprises. From here vegetables and fruits will be exported to partners, which are foreign import enterprises, and delivered to the last consumers. 3.3. The collaboration of the Vietnam exported fruits and vegetable supply chain. According to the survey of 138 enterprises, the co-operative plays a central role as collaboration in the Vietnam exported fruits and vegetable supply chain. Many enterprises, which filled in the survey, said that they just started to know about the concept of “collaboration in supply chain” or even never heard about this before. and nearly 55% of them said that they have heard about this before. Because of the limited knowledge about the collaboration, enterprises , as well as input and output partners have many difficulty in the degree of collaboration in the current supply chain. 3.3.1 The fact of the collaboration in the Vietnam exported fruits and vegetable supply chain. When considering the collaboration in the Vietnam exported fruits and vegetable supply chain, the author assessed based on the criteria mentioned in Section 2.2.3, including: The synchronization decision According to the overall assessment (the average value of the COL1 scale), this criterion is the highest, it means that the partners collaborate primarily through joint planning in supply chain operations. Collaboration is shown at the first step of chain operations and also demonstrates the will of the parties wishing to collaborate. The linkage between the parties is still weak and unsustainable. In addition, 90% of Vietnam vegetables and fruits are exported in raw and semi-processed form, leading to less collaboration in processing activities and planning of supply chain activities. The collaborative execution system This indicator reflects a lower average value (COL2). The system of collaborative implementation in Vietnam exported fruits and vegetable supply chain is demonstrated through the evaluation of contracts between farmers and processing enterprises. Regarding to the chain, these contracts are mainly fulfilled through an intermediary stage, called traders. According to the Southern Fruit Institute, 2.5% of fruits and vegetables is directly signed between businesses and growers, while the remaining 97.5% of them are consumed under contracts signed with traders and intermediaries. Thus, farming contracts, showing the collaboration between the parties in the chain, have appeared and implemented in a small number of enterprises but have not achieved the best effect. The incentive linkage This is shown in working together to develop market and new product (COL3), on the other hand, the value of this observation is not high (3.22). Although members of the chain expressed their desire to collaborate, the incentive linkage was not from members in the relationship between growers and exporters of fruits and vegetables. It was mainly promoted through measures and policies of government. The procedure of a creative supply chain A creative supply chain owns a procedure that ensures the unification and the flexibility in all activities of the network.Vietnam exported fruits and vegetable supply chain will be closely analyzed in terms of produce traceability to assess this issue. One the one hand, the consumers’ requirement for the quality of the goods becomes higher and higher. One the other hand, the inputs used by the farmers who take responsibility for planting products are not under control of the exporting companies. The produce traceability of Vietnam exported fruits and vegetable supply chain seems to be not standardized enough because all relating information is simply recorded by the farmers’ handwritten books. The enterprises collect them from the farmers as their method for produce traceability. Information sharing The observation value - COL5 ( the elements in supply chain share information frequently) was at the point of 3.22. This number was over the mean point but still in a low point. Though these elements have connected to inform the others, they haven’t supported each other to find solutions while problems come up. Instead, they have tried to define who would be at fault, and then let themselves manage as responsibility. 3.3.2 The assessment of the fact about the collaboration in Vietnam exported fruits and vegetable supply chain Achievements There exists factors building the collaboration of Vietnam exported fruits and vegetable supply chain. In addition, Vietnamese government continued to have certain actions to make the relationships among the farmers, the representatives of the farmers, and the exporters tighter by doing trade promotions in Vietnam and a lot of campaigns to promoting Vietnam fruits and vegetables in other countries. Limitations The farmer haven’t given information directly to the exporter. The flow of these information often goes through the dealers.The farming contracts has been put into practices, but it doesn’t work to make the links among the parties tighter as much as expected. There still exists unsynchronized decisions and lacks encouragement to more interactions between the farmer and the exporter. In conclusion, Traceability , the key issue of the creative supply chain, still implies many difficulties such as: the infrequently- updated data, the limitation of applying advanced technology. The research and development in it have not been practical enough to come into true. 3.3.3 The benefits and difficulties in pushing the collaboration of Vietnam exported fruits and vegetable supply chain Benefits The freedom trade agreements that Vietnam signed have taken effect, so that the elements in the supply chain have more chances of meeting the others, specially for Vietnam exporting fruits and vegetables enterprises and their own foreign business partners. Besides, these freedom trade agreements contain clauses helping to improve the productivity of supply chain with an unification and convenient working style. That contributes much to the increase in collaboration of Vietnam exported fruits and vegetable supply chain. The fruits and vegetables’ consumption has continually grown up. It causes the increase in exporting activity. Therefore, the efficiency of the supply chain requires every element in it to collaborate together for the most utilization. As a result, every member in the supply chain will get a higher profit. Difficulties The quality and the safety of products have still not been in high. It prevents Vietnamese exporting companies having more chance of doing business with foreign ones. As a result, the collaboration in the supply chain becomes weaker. Keeping supply sources stable and holding enterprises’ prestige. The international partners have concerned about the sustainability of Vietnamese supply sources and the ability to complete obligations. In both long-term and short-term, Vietnam should take more actions to build a stronger belief or trust or they may loose many potential chances. Raising a higher awareness about market development, improving ability competency. Pricing is one of the warning issues that Vietnamese exporting fruits and vegetables companies have to face. Because of the limitation of the scale of the farms and the production capacity, Vietnamese companies find it hard to compete with same products, especially vegetables and fruits from China. Therefore, in long running, Vietnamese enterprises should focus long-term goals when conducting research to develop stronger with priority to enhancing the cooperation with the elements of Vietnam's export vegetable and fruit supply chain. 3.4. Quantitative analysis of factors affecting the collaboration in Vietnam exported fruits and vegetable supply chain 3.4.1 Results of evaluating Cronbach’s Alpha scale and analysing exploratory factor EFA The author runs Cronbach’s Alpha in turn for each factor. After the first run, the observed variable TRU5 is rejected because the correlation coefficient of the total is 0.212 which is less than 0.3 and if this observation is excluded, the result of Cronbach’s Alpha will increase. After eliminating the TRU5 observation from the research model, all 7 scales have the Cronbach’s Alpha coefficient satisfactory because they are all greater than 0.6, the correlation coefficients of the total are all higher than 0.3. Particularly for the observed variable GS2, if this variable is rejected, the Cronbach's Alpha coefficient will increase, but because the correlation of the total is 0.529 which is still greater than 0.3 and and as keeping this observation, the Cronbach’s Alpha coefficient on the scale of government support remains high (0.825) so the author decided to keep it for EFA factor analysis. Thus, Cronbach’s Alpha analysis only removes TRU5 observation, all the remaining observations for the 7 scales are retained for EFA analysis. In terms of Exploratory Factor Analysis EFA, the author removes the CMM5 observation as rotating Varimax produce, there appears the CMM5 observation uploaded at both factors. After eliminating the CMM5 observation, the observed variables are convergent and distinct, the observed variables of the factors are correlated with each other as a whole, so the EFA analysis results are appropriate for use in this research. 3.4.2. Examination of the research model hypothesis with Pearson correlation analysis and multivariate linear regression Pearson's correlation analysis shows that the collaborative variable in the supply chain is correlated with the remaining variables with significance level p-value = 0.000, where trust and power are more strongly correlated with collaboration than other variables and collaboration in the supply chain is less correlated. Next, the author analyzes linear regression to test the hypothesis and the research model with collaboration in supply chain is a dependent variable and factors of trust, power, commitment, cultural, business strategy, government support are 6 independent variables. The results show that the adjusted R squared reflects the degree of influence of the independent variables on the variation of the dependent variable, in this case 6 factors affect 74.7% of the change in collaboration, 25.3% is due to factors other than the model and random errors. Durbin-Watson coefficient is 1.872 i