Vietnam retail sales soar in 2016
Vietnam retail sales reached $117.6 billion in 2016, according to the General Statistics Office.
Sales rose 10.2 per cent year-on-year, thanks to foreign investment from overseas, especially Thailand, Japan and South Korea.
Ranked among the 30 global retail markets with best opportunities by American management consulting firm AT Kearney, Vietnam witnessed major mergers and acquisitions in the retail sector in 2016.
Retailers from Thailand – with Central Group and Berli Jucker the pioneers – gained a strong foothold in the Vietnam market with Central’s stakes in Nguyen Kim and Big C and BJ acquiring Metro. Central plans to double its network to 70 supermarkets and 13 shopping malls by 2021.
Japanese retail operator Aeon joined the race with 30 per cent stake in Hanoi-based Fivimart and 49 per cent of Ho Chi Minh City-based Citimart. Department store operator Takashimaya stirred the market, opening its first Vietnam department store inside the Saigon Center in Ho Chi Minh City.
Korean conglomerate Lotte Group introduced its first online store Lotte.vn, and plans to open 60 new supermarkets in Vietnam by 2020.
A young population and a rapidly rising middle class are driving retail growth. Sixty per cent of the country’s 90 million people are aged under 35 and are familiar with global trends and brands. The average Vietnamese income has risen from US$433 to $2200 in just five years, allowing Vietnamese consumers to afford products and services from international brands.
There are currently 800 supermarkets and 160 department stores and shopping malls across the country, a number forecast to double in the next four years, thanks to government-backed development plans.
Supermarkets, convenience stores and shopping malls account for 25 per cent of total consumer spending – and that is expected to rise to 45 per cent in the near future. The last three days before New Year holiday in Ho Chi Minh City saw a rise of 20 per cent in purchasing in all commodities with food, confectionery and beverages driving growth. The rise was partly due to promotional and discount programs, and is predicted to continue to grow in the few weeks ahead before Lunar New Year.