Foreign Retail Companies Invest in Vietnamese Market
The emerging market of Vietnam poses interest to overseas retailers. Owing to the population of 95 million, large share of younger generations and growing standards of living, the retail market is considered as profitable. The market was opened for foreign investors in 2017, when Vietnam joined the WTO.
Xiaomi Group, Chinese hi-tech company, opened its first Mi Store in Vietnam in early 2018. By the end of the year the shop network will cover 15 cities in the country. GS25 Retail, a company from the Republic of Korea, has launched a joint enterprise with Son Kim Group to open 2500 stores in Vietnam by 2028. Thai investors are eager to enter Vietnamese market too: Berli Jucker purchased Metro Viet Nam, Central Group is the new owner of Big C Viet Nam. Vingroup acquired Maximark, Ocean Mart and Vinatexmart.
The Ex-President of the Hanoi Supermarket Association claims, that the current number of retail units doesn’t correspond to the demand, because of the population and economy growth. Simultaneously, the quality of domestic retail networks is quite poor, so high service standards are supposed to be the key advantage of foreign investors.
According to the information provided by the Association, overseas retailers control more than a half of the market. In 2018 the share of domestic companies is expected to be even lower, owing to managing and investment drawbacks. Although the Government of Vietnam tries to support domestic retailers, the measures will hardly change the trend in short run.
Press-release at the VGP News official web-site