24/09/2014 09:46 GMT+7 Email Print Like 0

Foreign retailers challenge domestic manufacturers

Hanoi, September 23 (VNA) – Retailers from Thailand, Japan and the Republic of Korea (RoK) are rushing to enter the Vietnamese market, putting pressure on domestic manufacturers, according to an article published on the English language news portal VietNamNet Bridge.

The Japanese Aeon retail group, for example, has recently received a licence for the development of a shopping mall in Hoa Lam Shangri-La Hi-tech Park in Binh Tan district, Ho Chi Minh City.

With the project, it plans to pour another 128.5 million USD into Vietnam after investing 512 million USD to develop Aeon Tan Phu Celadon in Ho Chi Minh City, Aeon Binh Duong Canary and Aeon Hanoi Him Lam.

Unlike the other existing retailers from Europe like Big C and Metro Cash & Carry, which focus on distributing domestically made products (90 percent of products displayed at the chains have Vietnamese origin), Aeon obviously has been trying to boost sales of Japanese products.

Yasuo Nishitohge, General Director of Aeon Vietnam, was quoted as saying that one-third of the goods to be distributed through the Aeon chain will be from Japan. The retailer possibly understands that Vietnamese favour Japanese goods, from technology products to clothes and cosmetics.

Japanese goods are displayed in advantageous positions which can easily catch customers’ eyes at Aeon Tan Phu Celadon. The retail shops that distribute Japanese goods also occupy the best positions in the shopping mall.

Analysts thought that Japanese goods would not sell well in Vietnam because of the high prices. However, at Aeon Tan Phu Celadon, the goods are at “reasonable price levels”, because they are made in China and Thailand.

In 2013, when Family Mart was ousted by Thai BJC from the 40-shop retail system in Ho Chi Minh City, people believed that the Japanese retailer would leave Vietnam soon.

However, in fact, as Kigure Takehiro from Family Mart said, the retailer has been looking for retail premises to develop a convenience store chain that could become the leader in the market in 10 years.

Meanwhile, Daiso, Hachi Hachi, Akuruhi and Tokutokuya, shops specializing in distributing Japanese goods, have been trying to strengthen their presence in many big cities in Vietnam.

RoK company Lotte plans to open 60 sales points by 2020 in Vietnam, while it now has less than 10 sales points. This shows RoK ambitious plan of conquering the Vietnamese market.

Meanwhile, analysts commented, BJC has “taken a shortcut” when coming to Vietnam by taking over the existing retail chains. It has spent 655 million euros to take over the 19 Metro Cash & Carry’s distribution centres.

Central Group, the owner of a Robinson distribution chain, has also taken quick steps in Vietnam. After opening the first Robins in March, it is hurrying to put another one in Ho Chi Minh City into operation, slated for November.

Pham Chi Lan, a renowned economist, noted that Thai, Japanese and RoK retailers will distribute products from their respective country’s manufacturers.

Lan, while emphasising that distribution will determine production scale, has urged the Government to apply necessary measures to encourage Vietnamese enterprises to open new sales points to help develop domestic production.
VNA/VNP