According to the latest figures from the General Statistics Office, Vietnam's economy has a growth rate of 7.02% in 2019. Retail sales of goods and services also recorded an impressive increase of 11.8%, reaching 4,910 billion VND (equivalent to 214.8 billion USD).
Meanwhile, the average monthly income per capita is estimated to reach VND 4.2 million in 2019. This figure is higher than VND 3.9 million in 2018, according to the General Statistics Office. In the Northern regions alone, Nam Dinh is the locality recorded the largest increase in purchasing power, with a growth rate of up to 18%.
These impressive statistics are creating a strong appeal to foreign retailers, who are planning to expand into new markets, especially among them Korean retailers. The business in this country is facing many obstacles due to population aging and one-on-one households prefer to shop online.
The Korean giants, such as Lotte Shopping and E-Mart, are now in Vietnam and will plan to expand further next year, but whether they succeed or not is still uncertain.
According to Mr. Nguyen Vu Duc, Director of the retail segment of consumer goods at Deloitte Vietnam, because the retail industry in Vietnam has great potential, fierce competition between brands is inevitable. In all different forms of retail, we are witnessing a fierce competition for market share between domestic and foreign retailers when they embark on market expansion strategies.
Retailers from South Korea are facing big challenges from Vietnamese enterprises. The most obvious example is the merger of Masan Group with Vingroup at the end of last year. The two sides announced the merger of consumer goods and retail businesses to create the largest retail brand in the country.
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The deal will help optimize Masan's operational strength and increase its strength in the Vietnamese retail market. Besides, Vingroup currently controls 60% of floor space in shopping centers in two major cities, Hanoi and Ho Chi Minh City.
Japanese retailers are also turning to Vietnam and their convenience stores are also highly appreciated by Vietnamese consumers. Among them, Aeon Mall is the most prominent name on the market. At the end of last year, this brand had just opened its second shopping center in Hanoi and the fifth in Vietnam was Aeon Mall Ha Dong.
Mr. Iwamura Yasutsugu, General Director of Aeon Mall Vietnam Co., Ltd., said: "Before, we only focused on building trade centers in big cities such as Hanoi and Ho Chi Minh City. In the coming time, we are going to invest more in other localities ". The next expected location that Aeon will aim for will be Hai Phong.
Along with the expansion of trade centers, Aeon said it will also make efforts to increase the percentage of Vietnamese goods sold at supermarkets and Aeon department stores. There are currently more than 2,600 Vietnamese suppliers supplying goods to Aeon.
Another notable name is the fashion retailer Uniqlo. Recently, this company has just opened its first store in Vietnam. As the president and CEO of Fast Retailing - the operator of the brand - Mr. Tadashi Yanai commented: "Vietnam is really a promising land".
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