Post-pandemic retail market recovers strongly
Post-pandemic retail market recovers strongly
The Thai Central Retail chain has announced plans to invest an additional VND20 trillion in its Go! and Tops Market stores in Vietnam. The decision is aimed at increasing sales to VND65 trillion in the 2022-2026 period and expanding its point-of-sale network from 40 provinces and cities to 55.
Olivier Langlet, CEO of Central Retail Vietnam, said Vietnam is one of the group’s major markets, with annual sales growing rapidly to nearly THB38.6 billion or more than VND25 trillion within 10 years, accounting for 22 percent of Central Retail’s total revenue. In 2021, despite the COVID-19 pandemic, the group’s retail sales in Vietnam grew 0.2 percent, marking a new record. Central Retail currently has more than 300 shops and 39 shopping centers, with total retail space of more than one million square meters.
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Another foreign retailer, AEON, also plans to build additional hypermarkets in Hanoi, targeting 20 shopping centers in Vietnam by 2025.
These and other expansion plans reflect an impressive post-pandemic economic recovery.
Domestic retailers are also thriving. The Masan Group, for example, has successfully overcome COVID-19-induced difficulties to maintain operations. In 2021, revenue of The CrownX - the owner of WinCommerce (with WinMart supermarkets and WinMart+ minimarts) and Masan Consumer Holdings - reached VND58 trillion. As a retailer of Vingroup from 2019, WinCommerce faced losses totaling more than VND1.23 trillion in 2020, but in 2021 its profits reached VND1.1 trillion.
The Masan Group has developed strongly and currently owns the largest retail network in Vietnam, with nearly 2,800 WinMart supermarkets and WinMart minimarts. In late 2021, Masan began franchising towards the goals of having 10,000 points of sale of its own and 20,000 franchised stores by 2025.
Many other retailers such as MM Mega Market, Saigon Co.op, and BRGMart, also plan to increase investment in expanding their operation networks to meet consumer demand.
The grocery retailer Bach Hoa Xanh is concentrating on improving its facilities to prepare for expanding its nationwide point-of-sale network from 2023.
The Vietnamese retail market is thriving |
Experts point to Vietnam’s growing middle class, rapid urbanization and a market of nearly 100 million consumers as auguring well for retailers. Data from the Ministry of Industry and Trade (MoIT) show that total retail sales of consumer goods and services in the first half of 2022 reached nearly VND2.72 trillion, a year-on-year increase of 11.7 percent.
Hoang Anh Tuan, Deputy Director of the MoIT’s Domestic Market Department, said that if price increases were not taken into account, the growth rate would be 7.9 percent, reflecting high purchasing power.
Vu Thi Hau, President of the Association of Vietnam Retailers, said that to enhance their competitiveness, retailers, both foreign and domestic, should give top priority to ensuring customer interests, choosing their points of sale locations, and offering competitive prices.
