Firms binge on dietary foods
Firms binge on dietary foods
Many foreign enterprises are gnawing into Vietnam’s lucrative market for dietary supplements.
At last week’s international festival of functional foods in Hanoi, many foreign functional food firms told VIR they had been looking to establish a niche in Vietnam.
Vietnam Mannyon Trading Co., Ltd, a branch of North Korea’s state-owned Mannyon Trading Group, established in 2012 with the total capital of $300,000 has already proved successful.
“We are operating well in Vietnam. The number of products we are selling, which are all imported from North Korea, have doubled from seven last year due to the market’s huge potential,” said Vietnam Mannyon’s general director Kim Se Un.
“Vietnam Mannyon is North Korea’s first company of the type to invest in Vietnam. We will soon increase the company’s investment capital and register more products,” Kim told VIR.
South Korean-backed Pyunkang Medical Corporation and Foundation established its company in Hanoi in June 2013 with the total capital of $50,000, operating under the Pyunkang Pah name.
“We will raise our investment capital. If business goes well in Hanoi, we will open branches in other localities,” said Bong Kil Choi, vice president of the corporation’s international business development division.
One of the main reasons behind’s Pyunkang presence in Vietnam is that its products had played a role in helping cure 50,000 patients suffering from skin diseases, 60,000 patients with chronic rhinitis and 43,000 patients with chronic asthma in South Korea.
“So many people in Vietnam are being hit by such diseases. That offers big opportunities for us,” Choi said.
Chinese-invested Tiens Company, the biggest functional food maker in Vietnam, reaped the total revenue of $60 million last year in Vietnam, up 20 per cent against 2011, and the firm was expecting a 10 per cent growth this year.
Tiens’ existing $25 million factory in the northern Hai Duong province’s Dai An Industrial Park is expected to bring the company an annual average turnover of $150 million in the future.
“Tiens has begun exporting its products to Europe, Bangladesh and Thailand, while expanding its markets via online sales,” said a Tiens source.
Tiens, which operates in 190 nations and territories, currently has 30 agents in Vietnam with more than 40,000 distributors. The firm markets 12 functional food products in the country.
Chinese-backed Tasly International Vietnam Co., Ltd under China-based Tasly Group, recently decided to distribute the group’s functional food products in Vietnam after 13 years of operating in Vietnam.
“We are seeking distributors and then will register about five to seven products. In 2012, the company’s revenue surged 131 per cent on-year, and this rate may reach 115 per cent this year. However, with the contribution from functional foods, the company’s total revenue will be far higher,” said Nguyen Viet Dung, the company’s commercial specialist.
According to Vietnam Association for Dietary Supplements, functional foods appeared in Vietnam about 10 years ago. But the country is now home to nearly 1,600 local and foreign firms producing and importing about 2,000 products. Some 52 per cent of their products are foreign made.
The association’s chairman Tran Dang said this rate would likely rise to 65-70 per cent over the next few years. The advantage foreign firms have in modern technology has provided them with a competitive edge, with products having a shelf-life of up to a decade compared to local products that can be sold for an average two years.
Vietnam’s functional food market has grown annually by about 25-30 per cent, Dang said.
vir
