Foreigners earn big money from Vietnamese functional food market
Foreigners earn big money from Vietnamese functional food market
Amway is building its second factory in Vietnam, NuSkin has got $15 million in revenue after one year of operation in Vietnam, while Unicity has got 22,000 members in its distribution network.
With 1,800 Vietnamese and foreign manufacturers and distributors, 10,000 product items, the Vietnamese functional food market is booming.
Herbalife reported global turnover of $4.8 billion for 2013, an increase of 18 percent over the year before, of which the sales to the Vietnamese market accounted for a significant proportion.
When Unicity Vietnam made it first presence before the public, Asia Pacific President of Unicity Group Christopher Kim emphad that, though the Vietnamese market has become very competitive, with hundreds of operational businesses and thousands of product items available, he is still optimistic about the group’s business performance in the future.
The success Unicity Vietnam has achieved over the last year has been described by one senior executive as “beyond our expectations”.
Mai Ngoc Lan from Unicity Vietnam revealed that the company is considering setting up a factory in Vietnam which would make products for export to regional countries.
Amway’s second factory in Vietnam, which is now under the construction, is expected to become operational in early 2015. The three production lines at the $25 million factory will churn out 24,000 products a year, worth $200 million.
According to Amway Vietnam’s CEO Doug Devos, the company has been growing stably over the last six years, since it set foot in Vietnam in 2008.
In 2013, Amway Vietnam earned $90 million in revenue, up by 14 percent over 2012.
The reports of market survey firms all have indicated that Vietnam is a lucrative market for functional food manufacturers. Vietnamese, with improved income levels, now have increasingly high demand for the functional food that help reduce weight, offer nutritional supplements, support cardiovascular health and improve beauty.
Euromoniter, a market survey firm, believes that the Vietnamese functional food market will grow steadily by 20 percent annually in the coming years.
Meanwhile, according to the Vietnam Supplement Food Association, 56 people out of every 100 in Hanoi and 48 out of 100 people in HCM City use functional food.
Melisa Tantoco-Quijano, NuSkin Asia Pacific’s President, noted that Vietnam is one of the manufacturer’s best newly emerging markets. “We can see high demand for anti-aging products here,” she said.
Encouraged by the high growth rate of 30 percent per annum, NuSkin plans to attain 33 percent growth in 2014, while it is moving ahead with plans to “conquer” the Da Nang market in the central region.
Doug Devos from Amway Vietnam believes that functional food manufacturers have a brighter future in Vietnam. With the ASEAN free trade agreement (FTA) which takes effects from 2015, the enterprises which sell functional food directly will benefit from the tariff cuts of 0-5 percent.
By that time, functional food manufacturers would have a vast market of 600 million consumers.
vietnamnet
