Attractive Vietnam retail market 2022 draws foreign businesses

Attractive Vietnam retail market 2022 draws foreign businesses

Perhaps, as many experts suggest, Vietnam’s retail industry has moved past the era of “the big fish eats the small”, and now whoever moves faster will come out on top. Therefore, the trend of domestic retailers partnering with one another and collaborating with foreign enterprises is becoming increasingly popular.

 

Vietnam retail market 2022 – Charm to appeal to businesses

Vietnam is one of the top potential countries in Southeast Asia in terms of its economy. According to retail industry statistics, Vietnam is considered a very active market, attracting many foreign and global retail businesses in recent years. This highlights the potential of Vietnam’s retail industry.

 

With high economic growth, a large middle class, and fast expansion, Vietnam has become one of the most attractive retail markets in the world. The Ministry of Industry and Trade has just released a report on developing the Industry and Trade Restructuring Scheme for the 2021-2030 period, consistent with the assessments of UNIDO, WB, INCENTRA, UN CONTRADE, and the EU-Vietnam Business Network (EVBN).

 

According to the Consumer Goods Industry Report 2022, the domestic retail market is continuously expanding and ranks third in the ASEAN region (after Indonesia and Thailand) in terms of retail and e-commerce scale. Additionally, according to the aforementioned organizations, Vietnam belongs to the group of 30 countries with the largest and fastest-growing middle class in the ASEAN region and the world.

 

Vietnam has attracted many global retail groups, such as FamilyMart, K-mart, Lotte, Central Group, Circle K, Mega Market, and more. Domestic businesses are also competing, such as Winmart/Winmart+, Bach Hoa Xanh, Saigon Co.op, and others. 

 

The potential of Vietnam’s retail market in 2022

 

The potential of Vietnam’s retail market in 2022 is assessed to be even more promising as big players in the market. They take advantage of the economic recovery period after the Covid-19 pandemic to expand their market share and dominate the market.

 

  • Lotte – a Korean retail business

 

Lotte plans to expand in Vietnam's retail market
                                                   Image 1. Lotte plans to expand in Vietnam’s retail market

 

In Ho Chi Minh City, Lotte Group plans to build a large complex called Eco Smart City, 1.5 times the size of the COEX convention and exhibition center in Samseong-dong, Gangnam District, Seoul. Meanwhile, in Tay Ho district – Hanoi, Lotte is expected to complete the construction of Lotte Mall Hanoi in 2023.

 

 

Central Retail invested $800M+ in Vietnam retail market
                                       Image 2. Central Retail invested $800M+ in the Vietnam retail market

 

Thai retail group Central Group is planning to expand strongly in the domestic market and Vietnam, with the expectation of achieving a spike in demand when the COVID pandemic is over.

 

In agreement with the business strategy published in the annual report, the group’s retail segment, Central Retail, has spent 30 billion baht ($848 million) to invest in Vietnam and aims to increase revenue to 100 billion baht. ($2.8 billion) over the next five years from the current 38.6 billion baht ($1.08 billion).

 

This plan is in line with analysts’ forecasts, who believe that Vietnam’s resilient economy will continue to grow after the pandemic. These projections suggest that Vietnam’s retail sector will grow 9% annually to around $150 million.

 

BRG Retail Co., Ltd., a member of the BRG Group ecosystem, will coordinate with Sumitomo Group to promote the development and expansion of the FujiMart supermarket chain, with a specific plan from 2022. opening 5 to 10 new stores and by 2028 will reach about 50 new stores in major markets across the country.

 

That means that the FujiMart supermarket chain will serve more and more consumers in Vietnam with a variety of quality food products, following the criteria “Fresh every day – Fresh every day” along with Japanese space and shopping style.

 

  • WinCommerce – The retail market is more dynamic with this domestic retail giant

 

WinCommerce expands the chain of Winmart/Winmart+
                                           Image 3. WinCommerce expands the chain of Winmart/Winmart+

 

Under the circumstance of the strong recovery of the economy after Covid-19, from the beginning of 2022 until now, the retail market has become more vibrant when WinCommerce has opened 6 new WinMart supermarkets and more than 300 WinMart + stores in 63 provinces and cities across the country. In the second half of this year, the firm will concentrate on opening 800 new points of sale, including more than 100 WinMart+ stores under the franchise model. Currently, the plan is being implemented on schedule with the set target.

In the southern region, the coastal city of Vung Tau was selected as the next destination of the WinMart supermarket chain after WinCommerce successfully opened 2 supermarkets in My Tho city and Bac Lieu city. 

 

Besides, Masan Corporation launched the WINLife ecosystem “All You Need” with the first chain of 27 multi-convenience stores to fully meet the essential needs of consumers with a convenient, offline-to-online experience at the “all-in-one” destination. The WINLife ecosystem is Masan’s next breakthrough to enhance the consumer experience with a unique technology-consumption model.

 

Initially, Masan officially put into operation a chain of 27 WIN multi-convenience stores located in key locations in Hanoi and Ho Chi Minh City. WIN serves the daily consumption needs of Vietnamese people such as necessities (WinMart+), financial services (Techcombank), pharmaceuticals (Dr.Win), F&B chains (Phuc Long), telecommunications services (Dr.Win), F&B chains (Phuc Long), and telecommunications services (Reddit). In 2022, Masan plans to open 80-100 WIN stores across the country. 

 

  • Aeon – Asia’s largest retailer from Japan

 

Aeon Vietnam expanded 10 times
                                                            Image 4. Aeon Vietnam expanded 10 times

 

In the first half of 2022, AEON Vietnam continues to operate the small and medium supermarkets of the AEON MaxValu chain, setting a milestone for the accelerated phase of opening this new supermarket chain. AEON MaxValu supermarkets have all received a positive reception from customers in the inner city, recording an average growth of 5-10% according to the retail industry report in the first 6 months of 2022.

 

Aeon currently has about 200 stores in Vietnam, including six shopping malls. Stores are focused in Ho Chi Minh City and Hanoi, the largest cities in Vietnam. According to the plan, a commercial center will be opened in the center of Hue city by 2024. The company is also considering increasing the number of supermarkets in Hanoi to 100 by 2025, about 10 times the current number.

 

When consumer demand gradually recovers, it is also the time when retail businesses consider their plans to expand “centipedes”, developing new product groups. It can be said that this is the time when a “groundswell” of competition is emerging in the retail market.

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Above is information compiled from many sources and reports from VIRAC. Sign up for a customized consultation HERE

 

VIRAC provides a variety of research reports on many economic sectors in Vietnam; including analysis from overview to details of the market, products – services meeting the needs of customers in many different fields.

 

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