Businesses fear growing presence of Thai companies in Vietnam’s market
Businesses fear growing presence of Thai companies in Vietnam’s market
After withstanding a barrage of Chinese goods flooding the market for years, Vietnamese businesses are now facing the risk of losing the home market to Thai companies.
The owner of a small shop in Thanh Xuan District in Hanoi, specializing in retailing sundries like toothpaste, toothbrush, shampoo, perfumed soap and socks, sourced from Thailand, said the shop has revenue of VND150 million a month.
She noted that Thai consumer goods have been quietly squeezing into the Vietnamese market and become favorite items of Vietnamese families.
“Thai goods can provide all the things for daily use, from underwear to fruit, from fruit juice to meat, from yoghurt to canned food. I myself like Thai fruits and cosmetics,” she said.
Vu Hoang Nam, a retired state employee, said he was going to open a convenience store, specializing in distributing Thai products. “I believe that Chinese low-quality products will be dislodged from the Vietnamese market and Thai products will replace them instead,” he said.
“I decided to open the store as soon as possible. As you see, many Thai shops have opened near my residential quarter,” he said.
A branding expert noted that Thai products can easily win Vietnamese hearts thanks to their high quality and the reasonable prices.
“Thai goods are not too expensive for the poor, while the quality is acceptable for high income earners,” he said, explaining why Thai products have been selling well.
“Thai products can be seen both at pavement shops and at supermarkets as well, available in all distribution channels in Vietnam, ” he added.
The report by the Ministry of Industry and Trade (MOIT) shows that Nam’s feeling about the flooding of Thai goods in Vietnam is true.
The report says imports to Vietnam from Thailand rank second to China, in terms of turnover.
Thai garments and consumer goods have been present in 9,000 markets throughout the country, where they are superior to products from other sources.
Thai electronics and refrigeration engineering products hold 70 percent of the home market share.
Thai fruits account for 40 percent of market share, even though tropical fruits are an advantage for Vietnam.
The branding expert noted that many Vietnamese businesses have been aware of the “Thai threat”, but still don’t know what to do to overcome the threat.
Nguyen Song Tung, director of a Hanoi-based consumer goods production company, noted that Vietnamese products are less competitive than Thai products.
“They have experience in making consumer goods. They have approached new technologies transferred by foreign partners. They can control the input material sources,” he explained.
“Their capability will be empowered by the ASEAN Economic Community that will take shape next year as well as the presence of Thai distribution chains in Vietnam,” he added.
