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Electronics market lucrative, but full of distributors
The unsatisfactory result of the 2011 year-end sale season discouraged electronics distributors. Then they put high hopes on the Tet sale season, and once more felt back into despair. And they continue waiting for new opportunities.
FPT jumps on the bandwagon
In mid 2011, the information that the Corporation for Financing and Promoting Technology (FPT), an information technology giant, attempted to jump into the home appliance and electronics market, made people half believe. Some people had doubts about the news, because the market, though being lucrative, was full of distributors already. They thought that the market has become too crowded for any other investors to squeeze into.
And the FPT Consumer Electronics (FCE), a unit of FPT Trading, officially made debut on January 1, 2012 with ambitious plans.
Le Trung Thanh, General Director of FPT Trading, said on Saigon Tiep Thi that besides the familiar products such as computer, computer accessories and mobile phones, in 2012-2014, FPT also targets the consumer electronics market, because “this is the market with the big scale equal to the markets of information technology products and mobile phones.”
FCE Director Hung Cong Hien said that FCE has obtained the right for the exclusive distribution of some products of Japanese Panasonic and the US Syabas, though he declined to reveal what products of Panasonic FCE would be distributed. As for Syabas, the products would be Popcorn Hour and Popbox.
Hien went on to say that the electronics distribution would bring 10 percent of the total revenue of FPT Trading in 2012-2014. In 2011, the distribution and production of technological products brought the turnover of 16,270 billion dong. This means that FPT is expecting the turnover of 1600 billion per annum from the electronics distribution in 2012-2014.
The pieces of the delicious cake divided already
The targeted turnover of 1600 billion dong is not a high figure in the eyes of other distributors, but it would be a big challenge for FCE, even though FPT has experience in distributing information technology and mobile phone products, as commented by a distributor.
Hien has also admitted that joining the electronics market at this moment, FCE will have to face a lot of challenges and difficulties, because there are too many rivals, though FCE has its own advantages.
Also according to Hien, the main sales agents and clients would be FPT Retail, and other retailers such as Nguyen Kim or Pico. However, a representative of Pico Saigon said FCE has not contacted it for cooperation. A director of a big retail chain in HCM City said he heard about the presence of FPT on the market as a distributor, but “FPT has not offered goods for sale so far, maybe because they have not got goods yet.”
Meanwhile, some other retailers in the city said this was for the first time they heard about FPT as an electronics distributor.
Not only retailers, manufacturers have also affirmed they have not heard anything about the plan to cooperate with them. A representative of Sony Vietnam said FCE has not mentioned the plan to become a distributor for Sony.
Nguyen Van Dao, Deputy General Director Samsung Vietnam (Savina), said he heard that FPT jumped into the electronics distribution market, but FCE has not contacted Savina so far.
However, even if FCE can contact big retailers or manufacturers, this does not mean that FCE would obtain to distribute the most attractive products.
At present, big electronics manufacturers in Vietnam, including Sony, Samsung, Panasonic or LG are directly working with big retailers on the distribution of valuable products such as TVs, washing machines or air conditioners.
“They would not be foolish enough to share the pieces of the delicious cake with FPT,” a distributor said.
Meanwhile, Dao commented that the consumer electronics market is decreasing, which would be a big obstacle for new distributors.
vietnamnet
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