Foreign fashion firms consider Vietnam a ‘gold mine’

Zara opened in HCM City after one year of announcing its plan to penetrate the Vietnamese market.

The fans of the Spanish fashion brand now can buy Zara’s products directly instead of ordering online, buying via intermediaries or travelling abroad.

Shopaholics flocked to Zara Shop on the first two days after the opening. Housewives and office workers, teenagers and young women spent time queuing up in front of fitting rooms and checkout counters.

Doi Song & Phap Luat quoted a source as reporting that the revenue of the shop on the opening day was VND5.5 billion. Assuming one visitor bought VND1-2 million worth of products, the shop received 2,700-5,500 visitors on that day.

Meanwhile, sources said that H&M, the rival brand of Zara, will come to Vietnam early next year.

The sources said the first H&M store would open on Dong Khoi Street in HCM City by early 2017. The second would open in November 2017 on Nguyen Trai Street in Hanoi and the third on Minh Khai Street in Hanoi by early 2018. All three shops would be located within high-end shopping malls.

Prior to the openings of Zara, Thai, Chinese and many well-known fashion brands such as CK, Levis, Pierre Cardin, D&G, Gucci and Mango had arrived in Vietnam.

The products bearing well-known brands are now distributed by Vietnamese garment companies. Mai Son JSC, for example, distributes Mango products and Thanh Bac Thoi Trang Co Ltd distributes Levis’. 

Meanwhile, An Phuoc Company distributes Pierre Cardin’s products under a franchise contract, while Viet Tien Company sells Sanciaro and Nha Be sells Mahattan products.

In HCM City, the shops specializing in distributing foreign fashion products have been mushrooming at large shopping malls such as Vincom, Crescent Mall, Bitexco Financial and Saigon Centre. They are also available at shops on the ‘fashion streets’ of Nguyen Trai, Le Van Sy and Cach Mang Thang Tam.

It is estimated that nearly 200 foreign fashion brands are present in Vietnam, holding 60% of the market share. Mid-tier brands such as Giordano and Bossini, and high-end brands such as CK, Mango, and D&G ate the most favored in Vietnam.

An analyst commented that foreign fashion brands have been flocking to Vietnam in recent years because they consider the country a ‘gold mine’. The Vietnamese market with 90 million consumers and expected 15-20% retail growth rate is a lucrative one in their eyes.