Expanding export markets for cigarettes

New products, new markets

From the requirements to develop exportproductsinto new markets, the Company has implemented many new product researchesfor improving product qualityby usingcoressponding high-qualitytobacco and non-tobacco materials. In particular, there is aspecial emphasis on cigarette products with controlled Tar/Nic content according to the new tendency of consumers in foreign markets.A series of cigarettes brands in this product line such as Capital, Fisher, Hansam, Issue, etc are exported to foreign markets with continuously increasingvolume. Besides, the company also enhances thedevelopment forits traditional products in new markets such as Era, Saigon, Young Star, Memory, Melia, etc. Due to the persistency in pursuing strategic objectives to findnew customers, expanding new markets, boostingthe export sales withits own brands to increase export volume and concurrently reduce the dependence on traditional clients, the revenue and value from exports continuously increase annually. In 2013, the Company particularly reached the record for the increase rate in export volume of 19.5% compared with 2012. In this period, some new markets that attaingood growth rate of exports are countries in the Middle East, Africa, North Korea, Malaysia, Taiwan, etc. Thereby, it has madesignificant contribution to create job, increase income for workers and cover the decreasing cigarette volumeconsumed in domestic market. This is a long-term strategic direction thatintensifies valuefor variouskinds of cigarette underVINATABA SAI GON brand name in the recent years.

Along with strategy on boosting cigarette export into new markets, the Company's export activities also focus on the cooperation with some potential clients with strengths in export in big markets such as Asia, America. In particular, the co-operation with T-Tech International Company Ltd. from May 2013 has achieved the export volume of nearly 100 million packs of various kinds of John cigarette brand (accounting for 16% of the total export volume of the Company in 2013) so far, which significantly contributed to increase the export value and volumeof cigarettes in overseas markets. When evaluating this result, Mr. Nguyen Duy Khanh, Director of the Company said: in 2011, the export volume of the Company mainly relied on three major customers: OGT for 68% (425 million packs), Gaya Tabah for 19% (113 million packs), Dalian for 6% (36.8 million packs) and some other customers with a relatively minor but stablepercentage like Hua-Ying, however in 2013 there are 4 big and prestigious customers in the world co-operating with the Company in doing business. In particular, in 2012 and 2013, Gaya Tabah and T-Tech International Company Ltd. continuously increasevolume, contributing to help the export value of the company reach a record of 83.3 million US Dollars in 2013. With the above results, Saigon Tobacco Company continues to take the leading positionin Vietnam National Tobacco Corporation in cigarette export volume and value to overseas markets.

Professionalization in import and export activities

As a leading cigarettes manufacturer and exporter of Vietnam National Tobacco Corporation, in recent years, the company has ceaseleely conducted the research on import and export guidelines and policies of the Government and Central Ministries to apply intobacco import and export activities. The Customs professions and import-export processeswith modern methods are strictlyperformed by the professional staff of the Company to meetrequirement of quickness, accuracy and efficiency for each export shipment. Mr. Nguyen Kien Quoc, Head of Import and Export department of the Company, said that despite the large workload and minor number of employees, thanks to the application of highly professional methods, the import and export activities can be operated efficiently, significantly making the contribution inthe strategy to boost the cigarette export in the region and around the world. Besides, the legal procedures in trading contracts are also strictly followed by the staff of Import-Export Department to fully meet the requirements of International practices in each country that has business relationship with the Company. This has prevented the risks and losses that may occur during the participation in the international trade, which increases the benefits and efficiency of production, business, import-export activities for the Company in the past years.

With the above significant results, since 2008 up to now, the Company's import-export business has the honour to be awarded manyCertificates of Merit by the Government, the Ministry of Industry and Trade and Vietnam National Tobacco Corporation for the achievements in export and import assignment. Regarding it as honor and pride, all staff of the Company generally and the staff of Import-Export Department in particular always take their highest responsibility to fulfill their assigned tasks and strive ceaselesslyforattaining new achievements in the coming periods.