Parkson Retail Asia continues narrowing its business in Vietnam
Suffering strong losses due to its inappropriate retail concept for the Vietnamese setting, Malaysian retail giant Parkson Retail Asia is looking to dispose of its store in the port city of Haiphong.
After getting rid of this store, Parkson will have only one store left of the eight it operated at the 2012 peak of its 15-year career in Vietnam.
The unit to be disposed of, Parkson TD Plaza shopping centre in Haiphong city, is to be transferred from Parkson Vietnam – the legal entity of Parkson Retail Asia in Vietnam – to Thuy Duong Construction & Trading JSC for a cash consideration of $10 million.
Parkson TD Plaza in Haiphong city is to be transferred to Thuy Duong Construction & Trading JSC
The transaction still waits for official approval by Parkson Retail Asia’s shareholders, who will vote at the next irregular meeting.
Thuy Duong Construction & Trading JSC also owns the TD Plaza building where the Parkson TD Plaza shopping centre is located.
After transferring Parkson TD Plaza, Parkson Vietnam will focus on the operation and management of Saigon Tourist Plaza – its last remaining outlet in Vietnam and the first store it opened in Vietnam in 2005.
As a subsidiary of Parkson Holdings Bhd., Parkson Retail Asia was one of the first international retailers to enter Vietnam in 2005. By 2012, Parkson built a network of eight stores in Vietnam's major cities by 2012.
Five of these were directly owned by Parkson, including Parkson Hung Vuong and Parkson Flemington in Ho Chi Minh City; Parkson Long Bien, Parkson Keangnam, and Viet Tower in Hanoi; and Parkson TD Plaza Shopping Centre in Haiphong city.
The remaining three were Saigon Tourist, Paragon, and CT which were leased and managed by Parkson.
However, Parkson's business in Vietnam has been gradually slowing down since 2014 when the retailer started to lose the upper hand to newcomers who built multi-functional trade complexes to better meet the demands of different visitors.
Parkson, meanwhile, targets higher-income buyers with fashion and commodities only.
The retailer was forced to gradually close its stores, starting with the centre at Keangnam Hanoi Landmark in 2015. This was followed by Parkson Paragon in 2016, Parkson Viet Tower in 2017, Parkson Flemington in 2018, and Parkson Cantavil An Phu at the end of 2018.
In order to survive, in April 2019, Parkson renovated its Saigon Tourist Plaza from a “shop and go” to an “all-in-one destination”.
With its fresher facade and transformed retail mindset, this store is now receiving good visitor traffic and has drawn in a steady base of large-scale tenants, including famous fashionista Uniqlo and Muji.