“In the period of economic crisis, enterprises will face many types of risks that under normal conditions may not be fully exposed. For example, if you want to develop too quickly, but your financial capacity is limited, you have to depend on banks too much. Or, the management capacity is weak but the scale of operation is too large” – Mr. Le Huu Hung, Chairman of the Board of Directors of Hung Duy Co., Ltd.
“Don’t be startled when many enterprises go bankrupt,” businessman Le Huu Hung, Chairman of the Board of Directors of Hung Duy Import-Export, Technology and Service Co., Ltd (Tay Ninh) said when asked about his business. experience of avoiding the “storm” crisis of enterprises in the province.
According to Mr. Hung, in the period of economic crisis, enterprises will have to face many types of risks that in normal conditions may not be fully revealed. For example, if you want to develop too quickly, but your financial capacity is limited, you have to depend on banks too much. Or, management capacity is weak but the scale of operation is too large. There is no foresight to hedge risks when fiscal policy is tightened. The brand is not really strong. Only business in one industry, which is affected by the economic crisis.
However, Mr. Hung also acknowledged that interest rates are a vital factor affecting the development of enterprises.
Depends on your ability to work
Sir, through the working atmosphere of the company, you can see that the “health” of your enterprise is quite good?
Each locality has different characteristics, in Tay Ninh, enterprises invest in real estate less, medium-sized agricultural enterprises, quite a lot, so the impact of the economic crisis is not very large.
Although the general crisis has been said, every business will be affected more or less because of tight finances. But to respond, each person has a different way, when the business knows whether the rice and fish sauce is financially, it will only be affected a little. As our company only borrows working capital, does not borrow fixed capital, so there is little impact.
That result is caused by multi-industry business, so does one compensate for the other, sir?
That is also a reason, but the basic is still the process of building a brand and financial reputation.
At the moment most enterprises are complaining about inventory, but I have very little inventory. With two flour processing factories, each year the company exports over 50,000 tons of food flour, earning a lot of foreign currency for the province. That’s because our product brand has a strong foothold in the market.
I don’t know if you passed our gas station just now, did you notice the two commitment signs? If the buyer finds out that the measurement is wrong, I will compensate 5 times, the same goes for construction steel, the delivery is not of the right quality and the number of customers will be compensated twice.
Your enterprise has nearly 500 employees, dare to make such a commitment, you must have a very good control mechanism, right?
We have ISO that, from taking care of bonsai around the factory area to the office, we also follow the ISO 9001:2008 quality management process.
If you come to my factory or our company office and find a piece of trash, I commend you. This is actually I am not good at anything, but going abroad to see them make me follow. I told my staff that, if you litter indiscriminately, I have to hire someone to clean up, I have to pay people’s wages, if the cost goes up, it’s hard for them to raise their wages.
I talk to them every month, so if I direct them to do fraudulent business, how can I stand in front of them? I always advise you to live ethically and keep your faith, so when a contract has been signed with a loss, you still have to do it, the next contract will be profitable, and the buyer will not lose themselves.
As a business owner, in my opinion, business must be ethical. I once had to quit trading some items because I found it impossible to survive through fair and fair competition.
Will do the opposite
So his point of view is that everyone does what they want, no need to support the “giants” who have the name of enterprise owners but do not worry about doing business, but only worry about buying luxury cars and traveling with “long legs, short legs”. No?
That’s right.
Recently I heard that the government intends to “pump” capital for real estate enterprise. If it were me, I would do the opposite. I lend to people who need a home loan to live in. For example, an apartment of 600 million dong is affordable, lending them 300 million dong, they are able to pay it off gradually, both lightening the burden for the national finance, and creating jobs for the group of bricklayers and real estate investors. Selling real estate also pushes the commercial stage, the source of construction materials. This is also a way to avoid risks for banks when investing large amounts of money in real estate projects waiting to sell at high prices.
Recently you have heard Hoang Anh Gia Lai announced that the 50% discount on the apartment is still profitable, I believe that is a true statement, and so are many other real estate businesses. But if they are supported, they will not reduce the price anymore, and the high price people can’t afford to buy, the financial source is lying there. So this way is wrong in my opinion. The right way to do it is to lend and stimulate demand for consumers with real needs.
Talking about how to support businesses, how do you see the Government’s recent support package of VND 29,000 billion?
Having support is very necessary, very good, but if not clever, it turns into money to support businesses that do not know how to save, creating opportunities for these brothers to waste. In fact, you know, there are businesses with charter capital of less than 10 billion VND, which are small and medium enterprises, so they are eligible for support. Who knows, in fact, that he bought a set of high-quality cars, played with debauchery, the business was not difficult, it was strange, and then he was still supported by the state.
Meanwhile, many large enterprises tighten their belts, their profits are lower or they are at a loss, and both owners and employees are disadvantaged and are not eligible for support.
I see enterprises doing genuine business including both large and small, do not distinguish small or large. Why not distinguish between good and bad, but distinguish between big and small, many large enterprises do very genuine business, can’t borrow at low interest rates, tax exemptions and extensions for large enterprises can’t. But remember, small enterprises go bankrupt, workers are unemployed. When large enterprises fail, the number of unemployed workers will be very high. So which burden is greater for the state?
Is it because large and small are easy to distinguish based on capital and number of employees, but good and bad are difficult to distinguish?
I don’t think it’s difficult. In my opinion, the superiors should not classify but should let the localities improvise, if the policy supports businesses to do business properly, the bank will base on that. As for only supporting small and medium enterprises, he is already in the category of large and is eliminated, no need to know good or bad. Therefore, the support policy needs to be carefully studied, must be viewed from the bottom up and then directed down.
Or use the entire amount of this 29,000 billion dong to support interest rates for genuine businesses, no matter how big or small.
The above only saw the macro, I said for example that lowering interest rates is the most urgent need for businesses, foreign businesses they develop continuously because the interest rates are as low as three or four percent / year, I sometimes get to 20%/year. Now, let’s say, 15% commercial bank loans are not necessarily accessible, let alone 12-13%, so the macro view looks very nice, but the reality is not so. This story is always published in the press, the rate of businesses accessing preferential capital is very low.
But a good business like yours is probably still being offered by many banks?
Yes, banks “compete” to visit, but the demand has a level. Because I only borrow up to 30% for each activity, I also have to worry about it. I have two noodle factories but only borrow money for one factory, and I have many other businesses, including rubber. So that if for some reason the factory stops working, I still pay enough wages for workers, employees and bank interest.
Like I said, my self-contained way of doing business is less affected by the economic crisis.
Which I don’t know if I should say (a little pause).
I read in the newspaper that there is a director’s salary up to 30-40 million, while the salary of the provincial president is less than 10 million, but he has to run a large apparatus. In my opinion, it should be given in another way, maybe salary plus bonus, in order to avoid the situation that in the future, the younger generation competes to study high-paying professions, leading to an imbalance in human resources.
Actually, the banking industry is not too difficult because: depositors also voluntarily bring to the bank to deposit and borrowers also voluntarily submit documents to the place to apply for a loan. Borrowing or not is at the discretion of the bank.
Did you say that your company is being offered by many banks, so what is the current interest rate your enterprises is borrowing?
Bearing 15%, said to decrease, but only when it is due, the lowest level is 13%, can not be reached, if it is mature, only 13% can be borrowed.
The difficulty is that once you have a relationship with a certain bank, if you go to another bank, you have to make a dossier from the beginning, you have to pay off the money the bank is borrowing to get the file back. But there is not always money to pay immediately, because he who leaves money idle is inefficient operation.
So is operating interest rates more flexible and reasonable still in your expectation?
I hope the bank interest is low so that enterprises can do business effectively and develop the country. Interest rates are very important, if the interest rates are high, people with money will just put them in the bank and refuse to invest and do business. And that money source wants to become a healthy capital, the interest rate must be moderate. What I want to say is not to tighten the currency because of anti-inflation. Anti-inflation is very important, but it must be done slowly, controlling inflation is not enough in a day. Inflation has decreased very quickly, but it also leads to too many loss-making enterprises .
Of course, like I said, with stable enterprises, it is not possible to “go bankrupt” because of interest rates, but if interest rates are low, enterprises will invest in further development, so interest rates are still a decisive factor to prevent bankruptcy. whether enterprises in particular and the country in general develop further or not.
(*) Source: VnEconomy