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Retail sector escapes global gloom
Viet Nam's retail sector seems relatively sheltered from the global economic meltdown, with 120 supermarket outlets and shopping malls set to open this year, double the number as last year.
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| Customers browse washing machine products at the Savico Megamall in Ha Noi. The number of supermarket outlets and shopping malls will double this year to reach 120. |
Vinatextmart will lead the list with 43 of them.
Co.opmart will open 12 outlets and 18 of its Co.opfood shops.
After covering HCM City with a network of 80 outlets, food company Vissan plans to expand this year to neighbouring provinces.
Lottemart has received licences for two outlets in the central city of Da Nang and southern province of Dong Nai. The South Korea supermarket chain hopes to open 60 outlets by 2020.
Giant French retailer Big C has 18 outlets in Viet Nam but continues to expand.
The expansion plans come even as a report by Irish online market research site Research and Markets last November rated Viet Nam as one of the five retail markets making the highest profits in the world, saying that a modern retail system would play an increasingly significant role in the country.
The turnover of the modern retail channel continues to rise sharply, thought to be at the expense of traditional markets. For instance, during Tet, turnover at most supermarkets increased by 20 – 40 per cent, but plunged at wet markets.
According to figures from the Ministry of Trade and Industry, there are 700 supermarkets, 120 shopping malls, and 1,000 convenience stores in Viet Nam. But they only account for a 20 per cent market share yet.
The retail system, however, mostly focuses on the middle class, as made clear by their slogans like "Budget price for every household," "Friend of every family," "In hand with workers," and others.
"We are targeting customers with a monthly income of VND5-15 million," Pham Thi Quynh Ny, marketing director of Vinatextmart, said.
The supermarket will only begin to look upmarket when demand in the lower segment peaks.
Most retailers are still reluctant to look at luxury brands because selling them requires huge capital, experience, and professional skills.
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