According to the assessment of market research units, while many industries have negative growth indexes, the F&B industry in Vietnam has a positive recovery rate, reflected in business results in the first six months of 2021. Some companies such as Moc Chau milk made revenue of 1,411 billion VND, up 3.2% over the same period; profit after tax is 137 billion VND, up 29% over the same period in 2020.
Similarly, International Dairy Products Joint Stock Company recorded revenue of 2,380 billion VND, up 40.6%; profit after tax is 405.8 billion VND, nearly three times higher compared to the same period last year. In the consumer goods production field, Kido Group made net revenue of 4,898 billion VND in the first half of 2021, up 34% over the same period. In which, the revenue of the cooking oil segment increased by 36% and accounted for 83%, the food segment increased by 22% and accounted for 17% of the whole revenue.
The F&B industry in Vietnam is considered very potential. According to the market research group Euromonitor, the total revenue of the F&B market was more than 700,000 billion VND in 2020. It is forecasted that the revenue of the F&B industry in Vietnam in the next two years may double in size and continue to be an attractive "piece of cake" for investors. That is understandable when the pandemic is complicated, but enterprises in this industry still maintain a positive growth rate.
Companies in the F&B industry said that with the complicated and unpredictable developments of the COVID-19, they have faced challenges such as incurring costs to meet the "three on the spot" model to be able to continue production, difficulties in the transportation of goods, and services, etc.
Therefore, enterprises have specific plans for their operation in the last months of the year. For example, Vissan has expanded its business of pork and beef products to many different distribution channels, especially focusing on online sales channels, reviewing traditional market stalls to ensure effective business activity This enterprise also develops a plan for selling blister packaging products while waiting for the investment project of Vissan's cool meat packaging line to be put into use; along with that is a promotion program at sales channels to stimulate shopping demand in the post-COVID-19 period.
Meanwhile, Kido said that it had prepared new categories so that as soon as the pandemic is controlled, it will officially launch to the market. At the same time, it focuses on market research to expand the product portfolio of the cooking oil and ice cream segment, especially core and high-end products with high profits and trends.
According to experts, the pandemic may prolong. To be able to maintain the growth rate, businesses need to continue to monitor the situation and developments of the pandemic to take necessary measures and make timely business transfers. On the other hand, it is necessary to stabilize the supply, ensure that production activities and the supply chain of goods are not interrupted.
The pandemic brought about major changes in the consumption habits of the Vietnamese, which will, in turn, affect the trends of the F&B industry in Vietnam.
Consumers will have stricter demands about food safety and hygiene. In addition to their demands on how products are manufactured, they also expect the appliance of more advanced technology in processing, packaging, and preserving products.
In recent years, Vietnamese consumers are shifting towards organic and plant-based products, and the number of said consumers is increasing rapidly. According to Kantar Worldpanel, plant-based products are taking over Vietnam’s F&B market. Soybean-based products take up 83% of the market, while nuts and rice account for 11% and 6%, respectively.
The driven factor of this growth in organic and plant-based products is the belief of consumers that using said products will be healthier than animal products. The trend is predicted to grow even stronger in the coming time.
More and more people are adopting proactive methods to manage their physical and mental health. That is reflected in consumers' choices for foods and beverages. Categories considered healthy are becoming more popular, while “less healthy” ones face an uphill battle for growth.
When the Covid-19 pandemic appeared, consumers began to manage their diets more closely, and they began to turn to products that help improve resistance, increase immunity.
Vietnam is currently facing a pandemic outbreak with a higher level of danger. Although many households have prepared after experiencing previous waves of the pandemic, the long period of social distancing continues to create a lot of financial pressure for consumers. These pressures result in a sharp reduction in the spending of Vietnamese consumers. They gradually become more price-sensitive, restricting purchases for non-essential activities such as beauty services, eating out, and outdoor entertainment.
Customers, however, are still willing to pay more for high-quality products for better health care.
The COVID-19 pandemic has sent many big F&B brands “to their doom”. Traditional business activities were hindered, a series of restaurants and cafes had to pay ground and close. However, this also opens up new opportunities for brands, the most prominent of which are e-commerce activities and omnichannel distribution.
The strong acceleration of technology also creates momentum for the explosion of this trend. Types of online payment through e-wallets, QR codes; Ordering, evaluating, and redeeming points on mobile devices, etc., is both convenient for customers and ensures safety during the complicated epidemic period.
Delivery, ride-hailing, and e-wallet services have also benefited from the boom in e-commerce with the rapid increase in new users of these service platforms.
Compiled by VietnamCredit
