Food and beverage cooperatives seize new opportunities amid economic difficulties
Food and beverage cooperatives seize new opportunities amid economic difficulties
After the Lunar New Year holiday, many cooperatives, especially those in the food and beverage (F&B) sector, have accelerated their production to fulfil domestic and export orders.
Ly Hong Tien, Director of Hau Giang Xanh Cooperative in Hau Giang Province, told vnbusiness.vn that thanks to the links her cooperative has established with distributors, it was completing many orders of processed that lat fish to serve local demand and that for exports.
According to experts, though economic difficulties would continue in 2023, there remained untapped business opportunities for small firms and cooperatives in the F&B industry.
Experts said that when an economy was unstable, investors intended to return to industries with high demand as the F&B sector is an essential industry.
A recent report by iPOS.vn said that Viet Nam had around 338,600 restaurants and coffee shops by the end of last year. Last year, the F&B market was worth around VND610 trillion (US$26 billion).
It also showed that domestic people still favoured independent shops and restaurants. This was also the primary model that cooperatives and small businesses in the industry were developing.
According to representatives of cooperatives with food and beverage outlets, many consumers preferred this model because the prices of services, food and drinks here were affordable for most Vietnamese people.
They said that many cooperatives in rural areas had also invested in beverage shops and restaurants to meet people's needs instead of high-priced chain stores, which were concentrated mainly in first-class urban areas.
Large enterprises with facilities and factories in urban areas might face difficulties opening food and beverage shops in the countryside because of the high cost of transporting goods. However, this is an advantage for cooperatives as most of them have raw materials available. Experts said that with a focus on investing in machinery and promoting links with others, cooperatives could diversify their products and reduce costs.
Do Duy Thanh, F&B director of Horeca Business School, was quoted by vnbusiness.vn as saying that customers became pickier in choosing restaurants to suit their tastes. Currently, the newly-established food and beverage stores opened by cooperatives have also tended to develop and shape in their way, creating a distinctive feature.
For example, many cooperatives have opened coffee shops that provide customers with coffee produced by themselves. Besides enjoying coffee, customers could also experience the roasting and grinding coffee stages meeting OCOP standards, Thanh said, outlining a cooperative that had opened a coffee shop associated with a factory producing brocade goods.
Difficulty in capital and human resources
Despite their efforts in gradually identifying the needs of the market, in order for these cooperatives to effectively grasp business opportunities amid the difficult economic conditions, experts said they still needed more support from the State management agency.
Ngo Van Phi, Director of Dai Minh Agricultural Cooperative in the central province of Quang Nam, outlined insufficient capital as the major challenge for many cooperatives to expand their production, seek sources of goods and invest in processing and marketing. However, it was difficult for cooperatives to access loans with preferential interest rates, which required them to have collateral.
Phi suggested that loans for the collective economic sector should be flexible and diversifying. He also petitioned the authorities to be clear about the rules, regulations and administrative procedures so that cooperatives could access capital sources to speed up production and meet market demand.
Meanwhile, experts said most cooperatives in the F&B field had not yet paid attention to applying labour standards that were described as a must for cooperatives besides environmental protection if they wanted to meet the demand of markets, especially strict export outlets.
Cooperatives must make long-term plans to gradually improve labour standards and be ready for more stringent and specific requirements in the future. For example, experts suggested that they should invest in human resource management technology, paying insurance and bonuses for employees to create stability in work and affirm the cooperative model's role.
