Chuck Kuhn's Asia in Photos: Vietnam's retail market to explode over the next 2 or 3 years

Saturday, October 31, 2009

Vietnam's retail market to explode over the next 2 or 3 years

Vietnam’s retail market is forecast to explode over the next two or three years, with the appearance on high streets of many foreign retail companies, including shopping centers and large sized supermarkets, said Fabrice Carrasco, general director of TNS WorldPanel Vietnam on October 30.

Speaking at a retail and distribution conference held in Ho Chi Minh City, Mr. Carrasco said Vietnam’s retail market is smaller than that of other countries in Southeast Asia, such as Thailand, Malaysia and Philippine, however, Vietnam’s consumer habits are changing sharply.

According to RNCOS, a global market research company based in the US, retail turnover in Vietnam will top US$85 billion in 2012.

Vietnam’s retail turnover was $23.7 billion in 2008 and is expected to rise to $39 billion by the end of this year.

Bui Ngoc Hong, a law consultant at Indochina Counsel, said foreign firms have been eyeing retail and distribution business in Vietnam.

Indochina Counsel has alone supported seven foreign retail companies, which will appear on Vietnam’s high streets in the next two years, Mr. Hong said.

2009 is considered an important milestone year for trading and distribution sectors in Vietnam. Distribution in Vietnam is set for a shake up, as foreign companies move in following the country's commitment to open the market in 2009, on the back of World Trade Organization accession in 2007.

As a result, firms from abroad have been setting up shop here since early this year, particularly firms from Japan, though no official statistics are currently available.

Japanese sewing machine manufacturer Brother International recently won a license to set up a distribution company with an initial investment of $2 million.

Stainless steel and construction material producer Sojitz opened an import, export and distribution branch in March.

Car manufacturer Nissan and electronics producer Sharp have both started distributing their own products.

According to the Ministry of Industry and Trade, Vietnam's annual retail turnover has increased by 20 percent, on average, over the last few years and is forecast to maintain the same growth for the near future.

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They say "

“I can’t say what made me fall in love with Vietnam - that a woman’s voice can drug you; that everything is so intense. The colors, the taste, even the rain. Nothing like the filthy rain in London. They say whatever you’re looking for, you will find here. They say you come to Vietnam and you understand a lot in a few minutes, but the rest has got to be lived. The smell: that’s the first thing that hits you, promising everything in exchange for your soul. And the heat. Your shirt is straightaway a rag. You can hardly remember your name, or what you came to escape from. But at night, there’s a breeze. The river is beautiful. You could be forgiven for thinking there was no war; that the gunshots were fireworks; that only pleasure matters. A pipe of opium, or the touch of a girl who might tell you she loves you. And then, something happens, as you knew it would. And nothing can ever be the same again.”
― Graham Greene, The Quiet American

Tips on Travel to Vietnam

It's always warm in Southeast Asia apart from high mountains, so leave the heavy clothing at home. Cotton and breathable fabrics are always better than synthetics -- although cotton does wrinkle a lot when traveling! December through April is roughly the dry season in that region, although it can still rain a little. December is a good time to go in terms of temperature -- cooler than in the humid summertime. Either way, wearing more clothing (shirt sleeves and long pants) is always more respectful towards the Asian culture, especially when visiting temples and rural areas.