On August 11th 1981, Deputy Minister of Mechanics & Metallurgy- Mr. Le Van Triet signed the Decision No. 1250/CL-TCQL for establishing “Tan Binh Capacitor Manufacturer” under the control of the Union of Electronic Factories on the basis of separating Sony Division from the Electronic Equipment Installation Factory.
This is the importantly beginning step, and from that for over 25 recent years, Tan Binh Capacitor Manufacturer has become Viettronics Tan Binh Company, and since July 2004 it has been changed into Viettronics Tan Binh Joint Stock Company with famous “VTB” registered trade-mark.
We know that the Infomatics - Electronics industry is a production and trading one, which develops very quickly in the world and in the region for recent tens years. However, in our country, it still develops slowly for many different reasons. In this situation, Viettronics Tan Binh strives incessantly and from a small factory with limited size in all aspects, it rises, maintains and asserts itself, faces to challenges from subsidizing mechanism to market one to become the 1-style company. An agent seems to take the lead in Vietnam Electronics & Informatics Corporation as well as in Vietnamese electronic industry.
For 25 recent years, Tan Binh Electronic Company has passed greatly difficult periods to assert itself, change itself for existence and development. It is probably to divide into 5 periods bearing decisive importance as follows:
- 1st period: Overcoming difficulties (1981-1986)
- 2nd period: Finding newly developing direction for the company (1986-1991)
- 3rd period: Preparing for long future of the company (1991-2000)
- 4th period: Asserting itself (2000-2004)
- 5th period: Developing after privatization (from July 2004)
In miserably hard stages in 25 recent years, Viettronics Tan Binh has overcome and attained many successes for the following reasons:
- Because of the “Doi Moi” policy, open policy for attracting investment, which issued by the Communist Party and Government.
- Thanks to tireless efforts of the company's labor collective, from first employees present at the company on the establishing date to the other coming to the company later.
- Due to motivations and sound direction of the board of directors through periods.
- For effective cooperation of clients and business partners in domestic and abroad.
1st period: Overcoming difficulties (1981 - 1986)
In 1973, Japanese Sony Firm established a joint stock company in Vietnam, located at no.6 Thoai Ngoc Hau, Tan Binh District, fomer Sai Gon (currently is No. 6 Pham Van Hai, Ward 2, Tan Binh District, Ho Chi Minh City). Such Sony Joint Stock Company (“Sony Establishment”) has an area of around 4,000 m2. In 1975, after the South of Vietnam was liberated completely, this establishment changed into Tan Binh Mechanic & Electric Factory under the management of Ho Chi Minh City Industrial Department, operating mainly from 1975 1977 in the field of plating household metal wears with more than 30 employees. Until 1978, the Sony establishment became a factory under the control of VN National Factory (currently is Thu Duc Electronic Company).
In 1980, our country and Socialist Republic of Czech & Slovakia signed a Protocol of scientific & technical cooperation, in which the two parties had agreed to cooperate in producing some electronic spare parts for exporting to Czech. “Tan Binh Capacitor Manufacturer” under the control of the Union of Electronic Factories has been established since that in accordance with the Decision No. 1250/CL-TCQL dated August 11, 1981 of Minister of Mechanics & Metallurgy.
- Invested capital: VND 11,300,000 (based on the basic price prior to October 1, 1981)
- Initially designed capacity: 810,000 capacitors/year in accordance with Czech technology and 1,500 m2 printing circuits/year.
- Total regular employees: 460 persons, of which direct labors were 400.
That time was especially difficult. Our country had just come out of the long, arduous and fierce wars and was facing to new dangers not less difficulty than the period of war.
Both food & foodstuff were shorted. All were allocated in accordance with stamps.
In that situation, in order to improve the working condition and the life of the employee, the Board of Director of the company, beside the plan A, which, in accordance with the government's target, is to produce capacitors to export to Czech, the company also implemented plans B & C to increase income for the employee such as plating bicycle's spare parts, motorcycle's chimneys, even bred catfishes to attain more income.
During this time, the difficulties heaped up, but the company still tried to overcome, produce capacitors reaching record of more than 1.3 million units in 1986, while the designed capacity was only 810 thousand units.
2nd period: Finding newly developing direction for the company (1986- 1991)
Due to the political crisis in the USSR and East European countries, since 1990, the production line of capacitors postponed its operation. When the principal products were died, a challenge was not only for the manufacturer, but also for hundreds of employees and their families.
In the “precarious situation” period, except of civil electronic products, many new ones were produced and traded in the temporary manner:
Production of printing circuit sheets for export and exchange of USSR folding beds.
Processing of electric fans.
Switches, sockets, transformer from the wasted capacitors.
In addition, the company also proceeded the business association to create foreign currencies for importing spare parts and assembling, serving its change of business:
Associating with An Giang & Ho Chi Minh City Aquatic Companies to export aquatic products.
Associating with Lam Dong to export Vietnamese silks.
Associating with Ho Chi Minh City Polytechnic University to export tin.
Thanks to such motivation, the company created millions USD and supplied full work to hundreds of labors, and more importantly, it found the new heading: trading in civil electronic products.
3rd period: Preparing for long future of the company (1991- 2000)
In March 1992, Viettronics Tan Binh Factory received the decision of changing into Viettronics Tan Binh Company. Simultaneously, in this year the company gave series of changes bearing strategically orienting characteristics for a long-term:
- In 1993, the company adjusted its business registration certificate by the Decision 276 with the main scope of business: “production, assembly, maintenance, wholesale & retail of electronic products”.
- Establishing an electronic assembly factory (a joint venture with the electric company of Ho Chi Minh City located at 136 Ham Tu, District 5) for assembling white & black TVs for the domestic market.
- Investing around USD 700,000 in importing a production line for assembling color TVs of the JVC company under the form of CKD. This was the most modern one at that time.
In March 1992, Viettronics Tan Binh Factory received the decision of changing into Viettronics Tan Binh Company. Simultaneously, in this year the company gave series of changes bearing strategically orienting characteristics for a long-term:- In 1993, the company adjusted its business registration certificate by the Decision 276 with the main scope of business: “production, assembly, maintenance, wholesale & retail of electronic products”. - Establishing an electronic assembly factory (a joint venture with the electric company of Ho Chi Minh City located at 136 Ham Tu, District 5) for assembling white & black TVs for the domestic market.- Investing around USD 700,000 in importing a production line for assembling color TVs of the JVC company under the form of CKD. This was the most modern one at that time.
Establishing a joint venture with a first foreign company in the electronic field right after the law on foreign investment comes into effect. That was a joint venture between Viettronics Tan Binh Company, Ho Chi Minh City Electric Company and Germany VIBA company.
Since 1994 afterwards, the company's activities started thriving, which created some changes in its business, production, human resource organization as well as in the life of the employee. Firstly, it was the Decision No. 724 of the Minister of Heavy Industry graded Viettronics Tan Binh Company as the 1st-level enterprise.
Secondly, the Board of Directors of the company negotiated with two leading multi-national groups in the electronic field, they were Japanese Sony Group & Japanese JVC Group :
- Sony Vietnam a joint venture company (SOVINAM) was established and operating in the investment license No. 1013/GP. In order to implement this decision, the company's director gave a decision to send 240 employees of Tan Binh Electronic Company to work for the joint venture since October 27, 1994.
- Another joint venture JVC Vietnam (JVL) established in December 1996 in accordance with the License No. 1777/GP of the Ministry of Planning & Investment. In April 1997, VTB Company decided to send 138 its employees to work for JVC Vietnam Company.
This is the important & sound step of the Board of Directors of the company with the following specific targets:
- To train managers and technicians for the future of VTB.
- To accumulate capital for VTB to expand production and trading.
- To enhance VTB image in the domestic and international market.
After establishing two joint-ventures, the assembly of SONY & JVC products was executed by the joint ventures. VTB had not main products. The board of directors of the company tried to settle stalemates and to produce many other additional products such as:
- Hitachi color Tvs
- Assembling, processing of components and products for other companies including mechanical display, Micro, Radio Cassette, Speaker, Hifi set, Remote, BU. Block, Video,...
In August 1999, the Tan Tan Binh stock company (Vitek- VTB) was established to prepare for a new developing stage of the company: the stage of asserting existence and development of VTB.
4th period: Asserting itself (2000- 2004)
At the end of 2000, the first products bearing VTB registered trade-mark were launched in the market. These were color TVs with normal and super-flat screens, VCD, DVD, which were distributed in the wholesaling & retailing and maintaining networks in all 64 provinces and cities all over the country.
Since that, VTB registered trade-mark has been received and evaluated by consumers as one of Vietnamese strong brands. Their quality is always respected by consumers as Vietnam High-Quality Products.
Also in this time, VTB was the first Vietnamese enterprise, who participated in the industrial cooperative program between Asian countries (AICO) and Sony Vietnam company and Sony Singapore company. Every year, through this program, VTB exports around 3 million USD electrical components to other countries in the region. Although the revenue was not high, products “Made in VTB- Made in Vietnam” were known in the regional market.
In 2002, VTB continued asserting itself by the participation in the informatics technology field. The first production line for assembling computers in Vietnam was invested by VTB with the capacity of 60,000 units/year.
In 2003, to implement the policy of the Communist Party and of the Government in terms of privatizing enterprises, creating favorable conditions for cleaning up state-owned companies, increasing competitions of enterprises in the integrating progress, VTB proceeded necessary procedures to privatize. At the end of 2003, all arrangements for privatizing were finished and the Ministry of Industry issued a Decision No. 240/2003 dated December 31, 2003 to change Viettronics Tan Binh company into Viettronics Tan Binh Joint stock company with the legal capital of 70 billion VND, of which the state accounted for 51% of the legal capital.
On June 15, 2004, the 1st meeting of shareholders was held and the company officially operated under the form of a joint stock since July 6, 2004. This is an important development in the stage of development and asserting itself of VTB. Because, when it accepted to change into a company operating under the form of a joint stock, the board of directors of the company must face to many challenges especially in such seriously integrated and competitive stage.
- To orient the development of the company.
- Operating effects of the company.
- Harmonization between the interests of the company, employees and shareholders.
5th period: Developing after privatization (from July 2004)
Privatization of a state-owned enterprise is an essential thing so that the state-owned company is cleaned up more and developed better. But how to become better is not easy thing. Those are concerns not only of the company's leaders but also of the employee. Electronic enterprises have more concerns because they have more disadvantages comparing to other competitors in the region and in the world, and VTB is not beyond that orbit. Its concerns are:
- What is the competitive advantage of Vietnamese electronic enterprises in the integration?
- How do Vietnamese electronic enterprises exist and develop in the integration?
- In which direction does the company intend to develop?
In order to answer these inquiries, it is not easy. However, if the enterprise does well the following things, then it can overcome hindrances and develop:
- The preparation of the company includes:
• Human resource, because the employee is the decisive element of all successes. VTB in the recent time has done well this thing. The company's key employees have been trained in the market economy environment for many years, and professionally in the multi-national companies.
Teams of technicians are also trained professionally and updated with the most modern technology at the present.
• Material foundation, that is the company's administrative system, that is advanced, clear in obligations, powers, responsibilities and supported by modern management tools.
• Registered trade-mark.
• Relationship and business prestige.
When the company builds the said key elements, it shall certainly exist and develop. In fact, after 2 years of operation under the form of privatization, it proves that the stage of preparation of VTB is right.
- Revenue in the domestic market in 2005 increased 11.35% comparing to 2004.
- Export revenue of 2005 increased 23.16% comparing to 2004.
- Average income of the employee is VND 2,816,000 per capita
- Dividends of 2005 reached 22%.
- Market share attained around 5%.
- In 2006, ,many new high-tech products are launched in the market includes: LCD TVs, high-resolution TVs, Laptops, LCD screens.
- Especially, the company develops a new scope of business, it is refrigerating one. Its products are VTB trade-mark refrigerators, washing machines, which are respected by consumers.
These are the first results to create belief and preparation for a long-term & stable development of the company.
Plan and orientation for the future of VTB:
At present, VTB has been setting up the following scopes of business:
- Civil electronics
- Informatics technology
- Financing investment and trading in real estates
The target of VTB is to become a multi-functional group, including production, trading in and services with the said existing products, and at the same time to develop some new fields:
- Civil electricity
- Industrial electronics
- Trading in offices for lease
- Communications technology
With this orientation, how to reach the said target is very important thing. In order to proceed these plans, the company has prepared:
- For material foundation: the company has signed a long-term (50 years) leasing contract for 34,000 m2 at Cat Lai Industrial zone, district 2 to expanding its production until 2011.
- For capital: the company has prepared a plan to increase the legal capital of from 70 billion up to 120 billion.
- To prepare other conditions to post a bill and implement transactions on the stock market at the beginning of 2007.
- To train employees for the future. Many young officers of around 30 years old are appointed for important positions in the managing system of the company. This is the key source of officers of VTB in the future. Besides, the company frequently holds training classes of management, technique for its managers and technicians.
For 25 recent years from 1981 - 2006, Viettronics Tan Binh has passed many rising and falling stages. From the first stage when it was established to the stage when it asserts itself, changes into the developing one, it is a very difficult process. In order to reach such results, experience lessons taken out are:
- The union in the team work. However, sometimes there are local difficulties, but VTB collective is always united through the said periods. They, superiors and inferiors, show with their whole heart, look at the target of development of the company. This is created by the leading of the basic party committee, exemplary behavior of managers.
- The motivation and keenness of the company's leaders through the said periods, they know to catch opportunities, are brave and steady in management and the important this is that they point out development strategy for the company.
- Thanks to the “Doi Moi” policy and the “Privatizing state-owned companies” guideline of the Communist Party and the Government, it creates times bearing turning-point characteristics in the development of the company.
For the next period, Viettronics Tan Binh JSC is facing to new challenges and many new opportunities. With valuable lessons of experience drawn from 25 years of building and growing up, VTB shall be self-confident for its development and becoming a leading electronic industrial group in Vietnam and can expand to the region and the world for next 10 15 years.