INDUSTRIAL ORGANIZATION ESSAY AN ANALYSIS ON SHORT-TERM ACCOMMODATION ACTIVITIES IN VIETNAM IN 2010

THEORETICAL BASIS

Market structure

Market structure significantly impacts management decisions, encompassing the number of competing firms, the size of these firms, evaluations of technology and costs, and the ease of entry and exit within the industry.

Business scale

There is always existing a difference in the size of businesses operating in the same industry Business size may change over time.

Industry concentration level

Industry concentration serves as a vital metric for investors and policymakers, guiding sound investment decisions and effective regulations Also referred to as market concentration, it measures the production dominance of a few large enterprises within an industry (R Baye, 1958) A low concentration level indicates a competitive market where large firms exert minimal influence on supply, while a high concentration level signifies the presence of market power among major players, often leading to monopoly or oligopoly situations.

Historically, industry concentration was assessed by summing the market shares of major firms within the sector However, the landscape changed in 1982 with the enactment of the United States Federal Trade Act, which introduced the Herfindahl-Hirschman Index (HHI) as the benchmark for evaluating market concentration.

TIEU LUAN MOI download : skknchat@gmail.com concentration measure Today, there are two commonly used indices to calculate industry concentration, namely, Herfindahl-Hirschman (HHI) and CRm concentration ratio.

1.3.1 The HHI index (Hirschman-Herfindahl Index)

HHI was named after economists Orris C Herfindahl and Albert O Hirschmann, the Herfindahl-Hirschman (HHI) index measures market concentration, thereby knowing the level of competition of a certain market or industry.

The Herfindahl-Hirschman Index (HHI), initially introduced by Hirschman and later refined by Herfindahl, measures market concentration by summing the squares of the market shares of all firms within an industry This index is calculated by multiplying the sum of these squared market shares by 10,000, providing a comprehensive view of market dominance (R Baye, 1958).

N is the total number of firms in the industry is the market share of the i th firm in the industry

The Herfindahl-Hirschman Index (HHI) is a crucial metric for assessing the size of firms within an industry and indicates the degree of competition among them It is calculated by summing the squares of the market shares of all firms, yielding a value between 0 and 10,000 In a scenario where all firms possess equal market share, the HHI is determined by the formula HHI = 1/N * 10,000.

The HHI index can be determined using another formula:

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In which: n is number of firms in the industry and V is statistical variance of the market shares of firms, calculated using the formula:

In a perfectly symmetric market structure where all firms share equal market share (s_i = 1/n), the variance (V) equals zero, and the Herfindahl index (H) is 1/n However, when the number of firms remains constant, increased market asymmetry among firms leads to a greater variance, resulting in elevated index values.

According to international practice, competition administration authorities often classify markets according to the following spectrum:

HHI < 1.000: The market is said to be not concentrated.

1.000≤ HHI ≤ 1.800: T he market is said to be moderately concentrated

HHI > 1.800: The market is said to be highly concentrated

Using the HHI index, the market will be classified into competitive level based on the following criteria:

0.18 ≤ HHI: High market concentration and have a monopoly tendency

The bigger the HHI, the higher the level of concentration and vice versa, the smaller the HHI shows that no firrm has the more dominant power in the market.

Advantage and disadvantage of HHI:

- Sensitively reflects the firm's entrance or exit from the industry.

- It is easy to calculate and take into account all points on the market concentration curve, which means assigning a bigger weight for larger firrms

- It is unclear when comparing industries with equal concentration because it is not certain whether the size of firm in that industry will be equal or not

The concentration ratio in economics measures the relative size of firms within an industry, reflecting the level of competition A low concentration ratio suggests a highly competitive market, while a higher ratio indicates less competition among firms.

100%, which would be evident in an industry characterized by a true monopoly (R.Baye,

N the total number of firms in the industry

(i=1,…,n) is the I th firm in the industry, ranking from biggest to smallest

= is the market share of the i th firm in the industry

Variations in the value of 'm' lead to differing conclusions regarding market concentration levels It is important to recognize that changes in output, sales, or mergers can significantly impact these results.

The concentration ratio can fluctuate, but it remains unaffected if large enterprises do not alter their output, sales, or engage in mergers Various methods of selecting the parameter 'm' yield different outcomes, which is why 'm' is commonly set to 4 The CR4 index, representing the concentration ratio of the top four companies, is a widely used metric in analyzing market concentration.

Methods of minimizing the cost of the firms

A model of linking companies operating in the same industry value chain

Advantage: Firrms are not dependent on external suppliers.

Disadvantage: Firms lose their competitiven abilities Increasing management and administrative costs due to the expansion in organizational structure.

An informal relationship between a buyer and a seller in which neither party is obliged to adhere to any specific terms and transactions.

The enterprise enhances its competitive edge by specializing in its core strengths, ensuring that inputs are transformed into high-quality output products This specialization extends to suppliers and producers, who also concentrate on their areas of expertise, leading to improved efficiency and effectiveness in the supply chain.

Disadvantage: This method is only used when the inputs are standardized or mass produced.

A formal relationship between a buyer and a seller, which obliges the two parties to perform transactions in accordance with the specific provisions set forth in this legal document.

The purchasing company gains a significant advantage by leveraging the supplier's specialization, as the supplier tailors the product to meet the specific requirements outlined in the purchase order This approach is effective when the contract explicitly details the terms and conditions of the services rendered.

One significant disadvantage of contracts is the high legal costs involved, which can be a burden for many parties Additionally, drafting a comprehensive contract that adequately addresses the rights and obligations of both parties often requires considerable time and effort This complexity can also lead to challenges in effectively managing and mitigating potential risks or incidents that may arise in the future.

Indices evaluate the performance of firms

1.5.1 Total assets turnover ratio (TTS)

Total asset turnover (TAT) is a key indicator of an enterprise's asset efficiency, calculated by dividing net revenue by the average total assets for a specific period This average is determined by taking the mean of the starting and ending asset values, encompassing both current and fixed assets The TAT ratio reveals the revenue generated by each asset, highlighting the effectiveness of asset utilization in driving income.

1.5.2 Return on sales ratio (ROS)

Return on Sales (ROS) is determined by dividing after-tax profit by net revenue, reflecting the profit generated from sales and services A higher ROS indicates better business performance, showcasing the efficiency of revenue generation.

1.5.3 Return on assets ratio (ROA)

The profit margin is calculated by dividing net profit by revenue, while the turnover ratio of total assets is determined by dividing revenue by the average total assets This allows for the calculation of the profit-to-assets ratio.

Return on assets = Margin ratio × Total assets turnover

The ROA indicator measures the efficiency of an enterprise's production and business management processes, reflecting the average profit generated per asset utilized in these activities.

The higher ROA and ROE ratios are, the better, meaning that the business operates highly efficiently.

Barriers to entry and exit from the market

Barriers to entry and exit in the market can take various forms, influencing market dynamics, flexibility, and transparency When businesses can easily enter or exit the market, it indicates a highly competitive and healthy environment, where market prices are adjusted based on the actual competitiveness of firms.

On the contrary, in markets with large barriers, competition in the market is indispensable and therefore market power will focus on a small number of firrms.

Brand positioning strategy

Brand positioning involves shaping the perception of a brand in the minds of consumers, establishing a unique image that differentiates it from competitors An effective positioning strategy adds value and solidifies a brand's presence in the marketplace It serves as a foundation for guiding marketing, communication, and overall brand strategy One common approach to brand positioning is based on quality, emphasizing the superior attributes of a product or service.

Consumer perceptions play a crucial role in defining quality Gaining customer trust regarding quality is essential for brand success A well-established brand or product is perceived as more specific and distinct, leading to the notion of "higher quality" compared to generic alternatives.

Setting a premium price for a product or brand can enhance its perceived quality, as high prices often appeal to affluent customers seeking luxury and exclusivity This strategy not only caters to their sophisticated tastes but also reinforces the brand's value, provided that the products or services deliver exceptional quality and differentiation.

The perception of value in products has evolved, moving away from the idea that low prices equate to good quality Today, numerous valuable brands are emerging, with Southwest Airlines exemplifying a successful balance of affordability and strong brand identity As a result, many major airlines are now adopting Southwest's model by launching low-cost flight options through new or affiliated brands.

Many marketers utilize the strategy of differentiating their brand through distinct product and service features This approach offers the advantage of delivering a specific and clear message, which helps build customer trust by providing tangible parameters about the product Additionally, positioning the brand in relation to competitors can enhance its market presence.

This strategy focuses on positioning a brand by comparing it to direct competitors, a method frequently employed in various campaigns While it may seem redundant, many brands, particularly in the washing industry, actively engage in this tactic to demonstrate superior cleaning power.

Discover, a pioneering credit card company, emphasizes customer benefits with its slogan "It Pays to Discover," highlighting the financial rewards users receive when utilizing their cards.

Merge and Acquisition activities (M&A)

Merge & Acquisition is an activity that takes control of a business through a merger or acquisition between two or more businesses to own part or the whole of that business.

A merger involves the combination of two enterprises of equal size, resulting in the creation of a new entity with its own legal status The newly formed company assumes all assets, benefits, rights, and obligations of the merging businesses, which unite for mutual advantage.

Mergers and acquisitions (M&A) focus on actively participating in and influencing key decisions of the combined entity, rather than just holding shares Engaging in M&A can provide significant advantages for businesses, such as increasing market share and enhancing overall profitability.

TIEU LUAN MOI download : skknchat@gmail.com performance, reducing the number of necessary employees, reducing unnecessary expenses, taking advantage of transferred technology ,

Common forms of Merge & Acquisition implementation include direct capital contribution to businesses; acquiring stakes or shares There are also: merger business; business consolidation and division; separation of business.

OVERVIEW OF ACCOMMODATION SERVICES INDUSTRY IN

The importance of accommodation services in Vietnam

Tourism significantly contributes to GDP growth and economic development, with accommodation services playing a crucial role in enhancing the tourism sector The material and technical facilities within the accommodation service sector are vital components of the overall tourism industry.

Successful accommodation services require modern amenities and well-coordinated facilities The growth of the tourism industry is directly linked to advancements in material and technical resources.

The development of buildings, hotels reflects local economic and social development and reflects the development of local tourism and national tourism industry.

The short-term accommodation sector plays a crucial role in the tourism industry, contributing to a substantial 70% of the total revenue, as highlighted at the Hotel Investment and Business Conference in Vietnam.

Short-term accommodation industry is a tourism representative In order to attract customers and develop a customer market, accommodation must have modern facilities and amenities to meet the needs of tourists.

Building a multifunctional website that includes features such as classrooms, hotel extensions, restaurant services, and spa systems enhances convenience for tourists This technological advancement not only promotes various economic sectors but also significantly contributes to GDP growth.

The significant improvement in living standards has spurred a rapid increase in tourism demand, necessitating the accommodation service sector to expand at a pace exceeding GDP growth This expansion has created a rising need for materials and equipment essential for hotel construction and for supplying tourists, sourced from various industries such as agriculture, transport, and commerce Consequently, this dynamic not only fosters economic development but also enhances the overall GDP growth rate while promoting the sustainable exploitation of tourism resources and bolstering local economic development.

The formation and growth of hotel systems primarily occur in areas rich in natural resources, driving the development of accommodation services that unlock local potential and boost the local economy This growth not only stimulates the production of local specialties and handicrafts but also attracts a larger workforce Consequently, the accommodation service sector is vital for promoting socio-economic development at the local level Additionally, it holds a significant position in the national export strategy.

Attracting international visitors is a key strategic goal for tourism development and the accommodation sector An increase in foreign tourists staying at hotels directly boosts foreign currency revenue, contributing significantly to the economy.

The implementation of on-site exports in the hotel business significantly contributes to the country's export strategy This approach proves to be more efficient than traditional exports, as it allows for the sale of goods and services at international prices while minimizing various costs, including testing, packaging, customs fees, transportation, and storage By focusing on on-site exports, businesses can enhance their profitability and support the overall growth of the service sector in the economy.

To enhance the growth of the tourism services sector, it is essential for the government to invest in upgrading transportation infrastructure, alleviating traffic congestion, and expanding airport facilities, including the establishment of new airports Furthermore, improving investment policies and creating incentive mechanisms are crucial to attract investment capital.

Characteristics of accommodation services industry

2.2.1 Some conditions for short-term accommodation business

License of short-term accommodation business;

Measures to ensure security, order, environmental hygiene, safety, fire prevention and fighting under law for tourist accommodation establishments are available.

Accommodation facilities must ensure the minimum quality of construction architecture, physical foundations, and equipment according to each level and class of each type.

Hotels, tourism villages, villas, and apartments must deliver a comprehensive range of services that meet established standards Furthermore, it is essential that the staff possesses the necessary professional expertise to ensure quality service.

For camping sites, motel, houses with rooms for rent to tourists, other tourist accommodation establishments must ensure the minimum standard equipment.

2.2.2 Products of accommodation services industry

The intangible service product, which doesn’t exist as material so that the supplier and the consumers can't check its quality before they sell it or before it's bought.

Short-term accommodation services are inherently tied to their location, as they cannot be transported like typical goods These services are unique in that they cannot be stored; the production and consumption of accommodation occur simultaneously Therefore, businesses must consistently seek strategies to optimize room availability and maximize daily sales.

Short-term accommodation products are highly integrated, including a wide range of services and product categories to meet the needs of guests.

2.2.3 Existing types of accommodation services a) Hotel

A hotel is a type of tourist accommodation that typically features 10 or more bedrooms, providing quality facilities, equipment, and essential services for guests Various forms of hotels include city hotels, resort hotels, and motels Additionally, tourist villages offer unique lodging experiences for travelers.

A tourist village is a collection of villas, apartments, bungalows, and camping sites set amidst stunning natural landscapes These villages not only offer accommodation options but also feature restaurants, shops, entertainment areas, and various utility services to enhance the visitor experience.

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A tourist villa is a rental property equipped with amenities that allow guests to self-serve during their stay When three or more tourist villas are grouped together, they are referred to as a cluster of tourist villas.

A serviced apartment is a rental unit that offers self-service amenities for guests during their stay When there are ten or more of these units grouped together, they are referred to as cluster tourist apartments Additionally, tourist camping options are available for those seeking alternative accommodations.

Tourist camping is a land area planned in a place with beautiful natural landscapes, necessary infrastructure, tourism and material foundations and services for tourists. f) Tourist guest house

Tourist guest houses are tourist accommodation with necessary equipment and facilities to serve tourists like hotels but not up to the hotel rating standards. g) Homestay

A homestay refers to the owner's or legal user's residence that is available for tourists to rent, offering essential amenities and facilities for a comfortable stay Additionally, various services may be provided to cater to the needs of the guests, enhancing their overall experience.

Apartment and dormitory spaces feature shared amenities like elevators, common floors, and parking areas, making them a popular choice for their convenience and modern living experience.

THE MARKET STRUCTURE OF THE ACCOMMODATION SERVICES

Data description and processing

The dataset includes 316 enterprises from a total of 7,363 that report industry codes based on the VSIC 1993 classification Notably, businesses in the accommodation service sector do not utilize any 4-digit codes; therefore, we will examine this sector using the VSIC 2007 classification, which employs 5-digit codes The accommodation service industry falls under the broader accommodation and catering industry, categorized as tier-1 code I In the VSIC 2007 framework, the accommodation service industry is designated with a tier 2 code of 55, which encompasses two smaller branches identified as hospitality services, with a level 3 code assigned.

551) and other accommodation service providers (with code level 3 is 559))

To analyze the structure of the service sector, utilize the following Stata commands: set the variable 'dvlt' to 55 for industry codes ranging from 55101 to 55909, and summarize 'dvlt' Next, assign 'dvltnn' a value of 551 for industry codes between 55101 and 55104, and summarize 'dvltnn' Lastly, define 'csltk' as 559 for industry codes from 55901 to 55909.

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Results: there are 214 enterprises participating in the accommodation service sector, including 213 enterprises in the short – term accommodation service (551) and other accommodation service providers (559).

Check if there is an enterprise that is repeated through the business code variable (madn), implement these commands on stata: sort madn quiet drop if dup>1

Results: there' s no repeated enterprises, so no enterprise is deleted.

Examine the type of enterprise (lhdn)

According to the survey of enterprises with 14 types of enterprises, the state - owned enterprise group has codes from 01 to 06, the private and foreign private enterprises.

We enter the command: gen soe = 1 if lhdn == 1 lhdn == 2 lhdn == 3

lhdn == 4 lhdn == 5 lhdn == 6 sum soe

Results: soe has no observations, which means that 214 enterprises are private or foreign private sector.

Inspect the value of export and import of the short-term accommodation service sector

In 2010, a questionnaire survey of enterprises revealed their engagement in import and export activities Enterprises that participated in these activities were categorized as "yes" (1), while those that did not were categorized as "no" (2) To analyze the data, we will utilize the variables for export value (trigia_xk), import value (trigia_nk), presence of exports (co_xk), and presence of imports (co_nk) The results will be summarized by calculating the sum of export and import values, along with the counts of enterprises that indicated "no" and "yes" for their import and export activities.

Results: There are no enterprises operating in import - export activities, but only 207 enterprises declare this operation, the remaining 7 firms do not declare.

After processing data, we do the calculations for further research on short-term accommodation service sector.

Scale of firms

According to the 2010 data, there are total of 214 businesses in the accommodation service sector, including the following areas (general statistics office, 2007):

Table 3-1 Vietnam’s accommodation services structure in VSIC 2007

C2 Code C3 Code C4 Code C5 Code Name Quantity

55104 Guest rooms and similar accommodations activities 7

55902 Mobile camping, trailer parks, mobile vehicle 0

55909 Other accommodations are not yet classified 1

To classify the enterprise size based on the number of employees, we use the following commands on the Stata: sum ld11 ld13 if dvlt == 55 ld11 if dvlt tab == 55

TIEU LUAN MOI download : skknchat@gmail.com ld13 if dvlt tab == 55 list ma_thue if dvlt == 55 & ld13 >= 100 & ld13 = 300 ld13 if dvlt tab == 55

There are 17 names declaring the total number of employees at 1 / 1 / 2010, and 195 employees is the biggest value, belonging to the enterprise with the tax code of

4200571417, after looking up information at the General Statistics Office , this is Tan An Tourism Development Joint Stock Company There are 99 female employees-accounting for 50.76% of the labor force.

As of December 31, 2010, a total of 214 enterprises reported their employee counts, with 207 of these companies indicating an increase in female employees The enterprise with the highest workforce, Tam Nguyen Joint Stock Company, had 322 employees, of which 13 were female, representing 4.03% of the total labor force The company's tax code is 4201153370.

Finding enterprises in the accommodation service sector with the number of workers of more than 100 and less than 300 people (31 / 12 / 2010) list ma_thue ma_thue2 == 55 & ld13 >= 100 & ld13 = 300

Results: There is only one enterprise, tax code 3501519620 with 322 employees.

Concentration of accommodation services

Theoretically speaking in the theoretical section, we have the following calculation:

3.3.1 CRm concentration ratio (concentration ratio)

Table 3-2 4 Firms have the highest revenue in the 2010 service sector

Business name Business code Tax code Revenue

Tan An Tourism Development Joint Stock

Phu Xuan tourist & tourism service company 706964 0104796354 12237

Phuc Loi tourism joint stock company 735238 340036961 7029

Table 3-3 Vietnam' s market shares of accommodation services in 2010

STT Business Revenue (VND Market million) share (%)

1 Tan An Tourism Development Joint

Phu Xuan tourist & tourism service

4 Phuc Loi tourism joint stock company 7029 5.5

The concentration of the sector is: C4 = 48.9%

So the four leading companies’ revenue accounted for 48 9% total revenue, which proved that the concentration of the industry is high and this is quite competitive market.

The accommodation service sector experiences intense competition among numerous firms, making it challenging for any single company to dominate the market.

Market share ratio of Accomodation services in

Công ty cổ phần phát triển du lịch Tân An

51% Công ty TNHH dịch vụ & du lịch Phú Xuân

Công ty cổ phần du lịch Phúc Lợi

Figure 3-1: Market share ratio of Accomodation services in Vietnam 2010

The Herfindahl - Hirschman index is another way to calculate industrial concentration.

HHI defines as sum of squares of total market share of all enterprises in the industry The formula is:

With the database, we have HHI = 829.96 The level of HHI shows that the short-term accommodation industry in Vietnam is not concentrated with high competition.

Market access

The accommodation service industry is highly competitive, characterized by a surge in both the quantity and quality of services offered Often viewed as a "golden egg," this sector is experiencing rapid growth in construction and business activities, resulting in a supply that exceeds demand As competition intensifies, firms looking to enter the market must navigate stringent requirements related to legal compliance, technical expertise, human resources, and an understanding of market conditions.

Demand and market conditions of accommodation service industry

According to experts, Vietnam’s current demand for accommodation services is high and rising in the future However, low-conditioned infrastructures are barriers in the development of accommodation service business.

The growing demand and supportive government incentive policies create a favorable market environment for businesses to invest in the industry To succeed, these investments should focus on advancements in science and technology, as well as the development of high-quality human resources, ensuring competitiveness against foreign enterprises.

THE FIRMS’ BEHAVIOUR IN SHORT-TERM ACCOMMODATION

Legal issue

Short-term accommodation businesses in Vietnam are predominantly micro and small enterprises, facing challenges in the registration process that create barriers to entry in the market The legal procedures and associated costs vary across different sectors, necessitating careful cost analysis for small firms aiming to enter this industry To minimize legal expenses while ensuring compliance, these businesses must approach legal activities with meticulousness and accuracy, balancing adherence to regulations with their competitiveness in the market.

Research and development of firms (R&D)

Technology plays a crucial role in the development of various industries, with its application differing across sectors To analyze the technological landscape of the short-term accommodation industry, we examined the annual total costs associated with scientific and technological research and the number of computers utilized up to December 31, 2010 The data revealed that the total investment in scientific and technological research was zero, while the number of computers in use stood at 377.

Table 4-1 The short-term accommodation activities businesses invested in R&D and total number of workers in 2010

Industry code Total cost for scientific and Total number of Total number of technological research workers on 1/1/2010 workers on 31/12/2010

- Expenses for scientific and technological research in each industry in particular and the whole industry in general are zero.

At the end of the year, industry codes 55101 and 55103 experienced a surge in labor demand to satisfy market needs In contrast, the hotel sector represented by code 55101 maintained a relatively stable workforce, as employee numbers are typically predetermined and do not fluctuate significantly.

- Competitive businesses have equally power because science and technology are not competitive factors in the industry.

The accommodation industry thrives on the preferences of its customers, with the future of hotels being heavily influenced by the evolving characteristics of guests As technology advances, customers increasingly expect hotels to offer cutting-edge facilities, driving the trend towards integrating innovative technologies in the hospitality sector.

The accommodation industry in Vietnam is characterized by minimal investment in research and development, resulting in almost zero research costs and a high reliance on labor This situation allows for low initial capital requirements, aligning with Vietnam's strengths in labor-intensive sectors However, this development model is unsustainable for the future, as the lack of scientific research investment leaves domestic technology lagging behind foreign competitors The industry also suffers from low concentration, leading to intense competition, making it challenging for local businesses to compete with foreign firms that possess advanced technology and substantial capital Conversely, the low investment in science and technology enables firms to enter and exit the market with relative ease.

In line with the latest trends among leading global hotel chains, integrating modern technology is essential for enhancing guest experiences, boosting customer satisfaction, and improving operational efficiency, ultimately driving better business outcomes for hotels.

The accommodation service industry in Vietnam is experiencing significant growth and is poised to become a crucial component of the country's tourism sector This expansion necessitates a substantial increase in both the quantity and quality of the workforce A defining characteristic of labor in this service-oriented industry is that it is non-productive, focusing primarily on delivering services to meet customer needs rather than producing tangible goods.

Therefore, being able to provide good quality services is a criterion to evaluate the development of the accommodation service industry.

The total number of employees in the accommodation service business in Vietnam in

In 2010, the number of high-quality human resources in the accommodation and catering sectors was 2,527, but the tourism industry now faces a significant shortage of skilled professionals This sector demands not only specialized knowledge but also advanced technical and professional expertise While specialization allows for certain tourism activities to operate independently, it also presents challenges in the overall development of human resources within the industry.

The advertising strategies and marketing of firms

The global popularity of the internet offers significant advantages for businesses, particularly in the hospitality sector Hotels are increasingly leveraging online advertising strategies to enhance their visibility, as customers frequently use search engines like Google to gather essential information when looking for accommodations To capitalize on this trend, hotels must effectively promote their brand and image, ensuring they reach diverse customer segments and meet their reservation needs.

* Pushing hotel to the first search of Google

To effectively reach a vast audience of potential customers searching for booking information on Google, hotels must ensure their relevant details are accurately registered with the platform Providing specific, detailed, yet concise and engaging content is essential for maximizing visibility and attracting more bookings.

* Posting hotel information on booking websites

Hotel84.com, Agoda, Tripadvisor, Expedia, and Airbnb are among the most trusted platforms for hotel reservations today Listing your hotel on these reputable booking sites enhances your visibility on Google and provides additional opportunities for public relations and effective promotion of your hotel deals.

* Cooperation in selling rooms with travel websites

Many hotels promote the promotion strategy through cooperation in selling rooms with famous travel websites such as Mytour, Traveloka, Vntrip They also help reach more customers.

To avoid extra service fees, ensure your hotel has a dedicated website offering comprehensive information and direct online booking options Many travelers now prefer to use intermediary booking sites to compare prices and read reviews before visiting the hotel's official site to finalize their reservations, believing this approach is both safer and more cost-effective.

* Taking advantage of social networks to develop online marketing

Promoting hotels on popular social networking platforms like Facebook and Twitter can be highly effective By creating a dedicated hotel account and sharing engaging content, including room rates, types, and striking images, hotels can attract a vast audience Additionally, linking to pages with a substantial following enhances visibility and engagement, allowing hotels to reach a broader customer base.

Business position strategies

Vietnam's tourism growth has significantly influenced the hotel industry, leading to important transformations over the years In 2019, the hospitality sector was poised for continued success, driven by extensive international integration and the completion of numerous free trade agreements.

The positioning of hotel brands offers unique values and advantages to stakeholders For instance, Muong Thanh Group, known as the "Largest Private Hotel Chain in Vietnam," boasts a network of 30 hotels and projects across the country, featuring 3 to 5-star accommodations The hotels celebrate ethnic diversity and the rich traditions of Vietnamese culture, ensuring that the warmth and hospitality of the Vietnamese people leave a lasting impression on every visitor.

Muong Thanh employs a unified branding strategy for its hotel services, utilizing a consistent logo and name across its 3 to 5-star hotel network Each property is distinguished by adding local suffixes, ensuring a cohesive identity while highlighting regional uniqueness.

Muong Thanh has implemented a robust brand management system, utilizing a unified branding strategy that involves direct oversight from the brand director for each hotel unit, effectively minimizing the risk of brand crises.

Muong Thanh operates within the 3 to 5-star hotel segments, employing a branding strategy akin to Amanresort, yet targeting a broader market Unlike Amanresort, which focuses exclusively on high-end luxury, Muong Thanh appeals to a diverse range of customers This approach highlights a lack of distinctiveness in the brand, as it attempts to embody both modernity and ethnic culture without achieving a notable differentiation.

The rise of prominent domestic investment groups like VinGroup, SunGroup, Muong Thanh, FLC, BIM, and Tuan Chau is transforming key tourist destinations in Vietnam These companies are developing large-scale entertainment and hotel complexes that meet international quality standards, enhancing the country's appeal as a premier travel destination.

Ha Long, Da Nang, Phu Quoc, Nha Trang and more than 30 cities creating motivation and leverage for tourism development of the destinations That investment has gradually

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Price strategy of the business

Maximizing revenue is a crucial focus for accommodation operators, and achieving this often hinges on implementing effective pricing strategies Key factors influencing these strategies include customer segmentation, which allows businesses to offer the same product at varying prices tailored to different customer types The all-in price model enables guests to access additional services—such as meals, bicycles, and golf course access—beyond just room rates, often resulting in a lower room price while allowing hotels to sell multiple products simultaneously Other prevalent pricing strategies include price parity and flexible cancellation policies, which further enhance revenue opportunities for hospitality businesses.

Mergers and acquisitions of firms (M&A)

As Vietnam's economy undergoes renovation and restructuring, business mergers and acquisitions are becoming increasingly common, attracting numerous foreign investors to the market These activities significantly impact accommodation service businesses, presenting both opportunities and challenges A prominent player in the real estate mergers and acquisitions sector is Vinhomes, which exemplifies the trend alongside various other notable mergers and acquisitions within the hospitality industry.

* Han Hanoi Hanuel Electronics Co., Ltd acquired 70% of the shares of Deawoo 5- star hotel:

The value of the deal involving Deawoo Hotel has not been disclosed Owned by a Korean business, this hotel is strategically situated on Kim Ma Street, adjacent to Thu.

* BRG Group acquired Hilton Opera Hanoi hotel:

The acquisition of Hanoi Hilton Opera hotel is announced only after completion The BRG Group won ownership of Hilton Opera Hanoi hotel guests from German and Austrian partners.

* Ico Sovico Group acquired 5-star Furama Da Nang, Ana Mandara and An Lam Ninh Van Bay resorts:

When Furama was acquired by Sovico Group, the majority of 5-star hotels across Vietnam were under foreign management Backed by its existing land assets, Sovico Group expanded its portfolio by purchasing two more resorts in Nha Trang: Ana Mandara and An Lam Ninh Van Bay.

* Thien Minh Tourism Joint Stock Company acquired Victoria hotel and resort system in Vietnam and Cambodia:

A chain of 6 hotels - Victoria resorts acquired by Thien Minh, including: Victoria Hoi

An Beach Resort & Spa; Victoria Can Tho Resort; Victoria Phan Thiet Beach Resort & Spa; Victoria Sapa Resort & Spa; Victoria Chau Doc Hotel and Victoria Angkor Resort & Spa (Cambodia).

* Muong Thanh acquired Phuong Dong hotel:

Muong Thanh hotel investors acquired 53.4% of the shares of Phuong Dong hotel.

EVALUATION OF EFFECTIVE OPERATION AND CHALLENGES FOR

General evaluation

With the continuous increase in both the number and quality of travel businesses and, in

By 2015, the number of accommodation facilities in the country surged to 18,800, offering over 355,000 rooms, marking a significant increase from 12,352 facilities and 237,000 rooms in 2010 This represents an impressive growth rate of approximately 1.5 times over five years.

From 2010 to 2015, the number of facilities grew at an annual rate of 8.76%, while accommodations increased by 8.42% per year During this period, the growth of 3-5 star hotels outpaced the average, with 5-star hotels rising by 16%, 4-star hotels by 14%, and 3-star hotels by 13% Additionally, the international travel sector saw significant growth, with the number of businesses expanding from 888 in 2010 to 1,573 by the end of 2015, reflecting a 1.77-fold increase and an average annual growth rate of approximately 12.1%.

Business results in 2010: Statistics of the Hotel Department showed that in 2010, there were 12,352 accommodation establishments (up to 7.7% compared to 2009) with 237,111 rooms (up to 9.4% compared to 2009).

Table 5-1 Statistic growth rate of accommodation industry (June 28, 2018)

The effective operation of enterprises (via ATO, ROA, ROS, ROE)

In order to determine the performance of a business or an industry, it is common to calculate five groups of indicators:

In this essay, we just focus on efficiency ratios and profitability ratios.

The return on total equity (ROE)

The return on total assets (ROA)

The return on total sales (ROS)

- Step 1: Using command SUM on columns: “kqkd19”, “kqkd4”, “ts11” and “12”

- Step 2: Creating columns named: “ATO”, “ROS”, “ROA” and “ROE”

Table5-2 Total revenue and asset of firms in short-term accommodation industry in 2010

Kqkd19 Kqkd4 Ts11 Ts12 Total asset Ts232

Table 5-3 ATO, ROS, ROA and ROE of firms

Code ATO ROS ROA ROE

- Total assets turnover index is 0.07383, each 1% of capital invested in total assets, it returned 0.07383% of revenue This ratio shows inefficiency in the use of industry assets.

- ROS is positive but low, showing that 1 VND from sales of goods and services generated VND 0.11782 profit From here we can see the industry's profitability is low.

- Low ROA: On average, each 1 asset in the manufacturing process generated VND 0.008699 profit.

- Low ROE: This means that 0.00839 VND of net profit is from 1 VND of equity.

Social welfare of accommodation service industry in Vietnam

* Development of accommodation service sector associated with social welfare development

The accommodation industry in Vietnam is closely intertwined with tourism development, significantly influencing its growth Enhancing the accommodation sector not only boosts tourism but also contributes to overall social welfare Businesses in this industry are committed to advancing both accommodation services and tourism, aligning their goals with the broader mission of improving societal well-being.

Focusing on community welfare can lead to innovative approaches in responsible tourism While traditional methods, such as developing quality resorts, aim to attract visitors, they may not be the most effective strategy for sustainable tourism This is largely due to the community's limited awareness of environmental responsibility and the seasonal nature of certain agricultural activities that draw tourists Consequently, investing in hospitality resorts may not ensure consistent financial returns.

Responsible tourism solutions aim to enhance social welfare by promoting volunteer tourism, where tourists contribute as part-time resources in agricultural production, addressing local environmental issues while boosting community awareness and skills Additionally, responsible tourism development focuses on creating a network of local services rather than directly selling products to visitors, fostering a sustainable tourism ecosystem.

TIEU LUAN MOI download : skknchat@gmail.com products to restaurants, hotels and resorts to ensure the output and revenue stability for agricultural products (MA Duong Que, February 23, 2016).

In Vietnam, raising awareness about environmental protection and sustainable tourism is crucial for local communities to foster responsible tourism development Tourists often prioritize natural resources and cultural heritage, which significantly influence their decision to return Despite their importance, these elements are frequently overlooked in shaping Vietnam's image as a tourist destination.

To address environmental challenges, responsible tourism that combines volunteering and education can effectively mitigate negative impacts while enhancing local community awareness Engaging in environmental volunteer work encourages local residents to develop a better understanding of natural resources, participate in conservation efforts, and improve their capacity to protect their surroundings.

SOLUTIONS TO DEVELOP THE ACCOMMODATION SERVICES

Solutions for tourism development planning

To enhance Vietnam's tourism development planning, it is essential to collaborate with the Tourism Development Planning Institute of the Vietnam National Administration of Tourism This collaboration will involve reviewing and updating the tourism development strategy up to 2020 to ensure alignment with current conditions Additionally, the strategic plans for developing high-quality accommodation facilities must be comprehensive, including detailed guidelines for implementing the tourism accommodation planning effectively.

Solutions for state management

Strengthening state management in the accommodation sector is crucial for ensuring quality services after licensing private enterprises Regular appraisal and re-evaluation of hotels are essential to identify and address business shortcomings promptly Effective inter-sector coordination is necessary for ongoing inspections, and imposing stringent sanctions on businesses that fail to meet tourism service quality standards will help uphold industry integrity.

Solutions for market

To effectively serve their clientele, accommodation services must accurately identify and research their target market, focusing on psychological traits, interests, needs, and purposes By leveraging this research, they can tailor their products, services, and service styles to meet customer expectations Regular guest feedback surveys are essential for enhancing the quality of their offerings Additionally, fostering partnerships with domestic and international travel companies helps to expand their tourist market share.

Solutions for scale and type of accommodation facilities

The primary focus is on enhancing high-quality accommodation options to attract affluent travelers and international tourists, specifically by promoting the development of 2-star to 5-star hotels through various investment channels It is essential to encourage and facilitate the upgrade of existing hotels to 3-star to 5-star standards while increasing their financial resources Additionally, there should be a strong emphasis on modern architectural accommodations, including villas and resorts, to meet the diverse needs of visitors.

Solutions for finance

The government is enhancing the legal framework and foreign investment policies to establish a unified legal environment for both domestic and international investors, with a focus on prioritizing multinational corporations Additionally, it is intensifying investment promotion seminars in collaboration with diplomatic agencies to boost investment mobilization This includes conducting thorough market research and analyzing global and regional investment trends, as well as leveraging bilateral and multilateral cooperation to adopt successful investment attraction strategies from businesses worldwide.

Solutions for quality and quantity of rooms

To ensure a pleasant stay for guests, hotels should optimize room layouts and implement effective lighting systems It's essential to upgrade or replace outdated and damaged equipment, while also providing fresh personal items like towels and toiletries for each guest to maintain hygiene standards Additionally, staff must enhance their responsiveness to guest inquiries, efficiently addressing suggestions and complaints Hotel management should prioritize regular inspections and supervision to guarantee the highest quality accommodations for all visitors.

Solutions for additional services diversification

Hotels have evolved beyond mere overnight accommodations for business trips or family vacations, now catering to a diverse clientele with varied needs As the sharing economy reshapes visitor lodging, hoteliers are increasingly diversifying their offerings by adding ancillary services like coffee shops, restaurants, and gyms For instance, Village Hotels has introduced in-house Starbucks locations in 27 of their UK hotels, while the boutique Soho House & Co has partnered with Hubbard & Bell and Chicken Shop in London to expand into the restaurant industry.

Therefore, accommodation needs to focus on the development of additional services such as health care, entertainment, souvenir and research services to offer new types of services.

The short-term accommodation sector is experiencing significant growth, presenting numerous opportunities for businesses and investors However, this industry faces challenges, including intense internal competition and competition from foreign enterprises To navigate these obstacles, leading companies, in collaboration with relevant government ministries and agencies, must thoroughly understand the issues at hand and formulate specific long-term strategies to address weaknesses and enhance strengths This approach will ultimately boost competitiveness and attract more investment opportunities for both domestic and foreign investors in the accommodation market.

The competitive landscape of the industry indicates significant potential for the institute, making it a valuable investment opportunity As it continues to gain momentum, it is poised for robust growth, increased profitability, and a vital contribution to the nation's economy.

1 Công ty Grant Thornton Vietnam 3, 2011 Báo cáo khả o sát ngành dịch vụ khách sạn

2 Nhu, ThS Dương Quế, 23/02/2016 Dự án chương trình phát triển năng lực du lịch có trách nhiệm với môi trường và xã hội do Liên minh Châu Âu tài trợ.[Trực tuyến]

Available at: http://vietnamtourism.gov.vn/esrt/default.aspx- portalid=1&tabid52&itemid5.htm

3 Phương, L., 2017 Cạnh tranh ngày càng gay gắt trong dịch vụ lưu trú [Tr c tuyến]

Available at: https://bnews.vn/canh-tranh-ngay-cang-gay-gat-trong-dich-vu-luu- tru/51781.html

4 R.Baye, M., 1958 Managerial Economics And Business Strategy 7th ed.

5 Siêu, T H V., 2010 Đánh giá điểm mạnh, điểm yếu, cơ hội và thách thức đối với du lịch Viet Nam sang thập kỉ tới 2011-2020, không biết ch biên: Tổng cục du lịch - Viện nghiên cứu và phát triển du lịch ITDR.

6 Sở VHTTDL, Thứ năm, 28/06/2018 Bộ Văn Hóa Thể Thao và Du lịch - Tổng cục du lịch [Tr c tuyến]

Available at: http://vietnamtourism.gov.vn/index.php/items/13461

7 ThS Nguyễn Hồng Hiệp, 04:00 27/08/2018 Thực trạng hoạt động mua bán, sáp nhập doanh nghiệp tại Việt Nam Tạp chí Tài chính.

Tiêu đề	An Analysis On Short-Term Accommodation Activities In Vietnam In 2010
Tác giả	Vũ Thị Thu Nga, Lê Khánh Ngân, Tạ Mai Linh
Người hướng dẫn	Assoc. Prof. Dr. Tu Thuy Anh
Trường học	Foreign Trade University
Chuyên ngành	International Economics
Thể loại	essay
Năm xuất bản	2020
Thành phố	Hanoi

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