Vietnam retail sales hit record US$129 billion
Spurred by a rising middle class and influx of international retailers, Vietnam retail sales hit a record US$129.6 billion last year.
This was growth of 10.9 per cent over 2016, according to the Vietnam General Statistics Office (GSO).
Vietnam’s largest real estate company, Vingroup, starting expanding its Vinmart Plus convenience store chain in 2016 and has already topped 1000 stores – it opened 100 last month alone. It is predicted the store network could reach 3000 this year.
Meanwhile, Vietnam last year saw the arrival of a slew of foreign retail brands, headed by Japan’s Seven & I Holdings opening its first Vietnamese 7-Eleven convenience store in Ho Chi Minh City in June.
Swedish fast-fashion brand H&M followed in September with a store in the same city, while Zara, the chain of Spanish rival Inditex, opened its second Vietnam location in Hanoi in November (its first store, covering two levels, launched at Vincom Centre Dong Khoi in Ho Chi Minh City in September 2016).
Thailand’s Central Group has made several acquisitions in Vietnam, including the Big C supermarket chain and electronics retailer Nguyen Kim Trading. It also launched its first stationery and office supplies store in Vietnam last year.
South Korea’s GS Retail partnered with Vietnam’s Son Kim Group 12 months ago to open the first of their convenience stores in Ho Chi Minh City this month. They plan to open 2000 locations within 10 years.
Since joining the World Trade Organisation in 2007 and opening up to foreign goods and businesses, Vietnam has seen continued double-digit growth, led by a 31.5 per cent spike in 2008. With the Association of Southeast Asian Nations Economic Community taking full effect this month, Vietnam has eliminated nearly all tariffs on goods from within the region.
Meanwhile, supermarkets and convenience stores are selling meat and vegetables at prices that are 20 to 30 per cent higher than at traditional markets, and the number of specialty shops selling organic vegetables is growing.
Spending on cars, home electronics and other consumer durables is also brisk, with 70 per cent of Vietnam’s GDP coming from personal consumption.
The GSO says auto sales grew by 14 per cent in value, gemstone and precious metals by 13.2 per cent, food and foodstuffs by 11.1 per cent, cultural and educational products by 10.2 per cent, apparel by 9.6 per cent, and home products by 8.5 per cent.
Vietnam still has room for growth as modern retail channels like supermarkets and shopping centres account for only a quarter of total retail sales, and most of these businesses are in big cities, reports VIetnamNet. By 2020, the proportion of modern retail channels is forecast to rise to 45 per cent.