Retailers under pressure as more foreign peers predicted to come
Foreign retail businesses who came and introduced modern trade methods, technology together with professional management skills, have posed a big challenge to Vietnamese retailers (Photo: VNA)
Foreign retail businesses who came and introduced
modern trade methods, technology together with professional management skills, have
posed a big challenge to Vietnamese retailers.
They have so far dominated Vietnam’s retail landscape through merge and acquisition
(M&A), joint venture and foreign direct investment (FDI) activities.
Japanese retail giant Aeon bought 49 percent of Citimart’s shares and 30
percent of shares of Fivimart convenience stores. Meanwhile, conglomerate Lotte
from the Republic of Korea acquired 70 percent of the Diamond Plaza shopping
Thai retailer Berli Jucker Plc completed the purchase of Metro Cash & Carry
Vietnam as part of its plan to become a leading player in the region. It also
bought the Family Mart convenience store chain and changed its name to B’s Mart
Another Thai retailer, Central Group, acquired 49 percent stake in NKT New
Solution and Technology Development Investment Joint Stock Company, which owns
Nguyen Kim, one of the largest electronics shopping centres in Vietnam. Apart
from opening Robin Department Stores in Hanoi and Ho Chi Minh City, the group
also owned Big C Vietnam after offering 920 million euros (1.05 billion USD) to
France’s Casino Group.
France’s Auchan supermarket and Japan’s Seven Eleven have entered the Vietnamese
market with five and nine stores, respectively.
Experts said that more foreign giants will continue to join Vietnam’s retail
sector given the country is working to carry out its integration commitments.
Meanwhile, Vietnamese distributors are working hard to tackle their limitations
in financial capital, purchasing power, infrastructure, professional workforce,
and global ties.
Ho Chi Minh City is housing 207 supermarkets, 56 percent of which is owned by
domestic retailers and the remainder by foreign rivals.
Nguyen Phuong Dong, Vice Director of the municipal Department of Industry and
Trade, said that Vietnamese firms still hold advantages in the number of
supermarkets and convenience stores with proportion of 79 percent and 70
However, sweeping solutions should be deployed by both local authorities and
firms to protect domestic retailers from foreigners’ dominance as foreign
distributors have sustainable supply of goods, said Le Thi Thanh Lam, Vice
Chairwoman of Food and Foodstuff Association of Ho Chi Minh City.-VNA