Retail market booms, but eventual winners unclear
The foreign retail brands which have entered the Vietnamese market recently are all powerful and experienced, but it is too early to say who will thrive.
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The appearance of dishes at 7-Eleven, according to analysts, show that the Japanese retailer understands the shopping and consumption trend, and even the food taste of Vietnamese youth.
With 7-Eleven, Vietnam now has nearly 1,600 convenience stores and mini markets under 10 big brands.
Circle K, the chain from the US, has 242 shops, B’s Mart of the Thai TCC Group has 159, and Shop&Go has 121.
Vietnamese owned retail chains have also been expanding. Co-op Food owns 130 sale points while SatraFoods has 100 convenience stores. Vingroup has 900, and Vinmart+ shops in nine provinces/cities.
Analysts predicted that a new war would break out as Vietnamese and foreign retailers have to step up their expansion to protect the ‘land’ they have occupied amid the strong attack by 7-Eleven.
Vu Vinh Phu, an expert on retail market, said the 7-Eleven entry into the market could be a threat to other retailers, because this is a strong rival.
However, Phu said that though 7-Eleven has capability and a localization business model, it is still too early to say if it will hold the dominant position in the market.
Though 7-Eleven has succeeded in many markets, it has shut down all the shops in Indonesia.
7-Eleven Vietnam’s CEO Vu Thanh Tu said most of the convenience stores already occupy the prime positions in residential quarters and on streets.
A market analyst noted that businesses tend to develop niche markets and target different groups of clients.
7-Eleven, MiniStop and Family Mart target office workers and young people when offering fresh dishes and free wifi.
Vietnamese owned convenience stores such as Co.opFood, SatraFoods, Hapro, Vissan and Vinmart+ focus on providing essential goods such as meat, fruits and vegetables.
A former senior official of the Hanoi trade department stressed that Vietnamese businesses have their own advantages.
Vinmart+’s advantage, for example, is a closed supply chain, from farm to shop, while foreign retailers still depend on supply partners.
Vietnam has jumped five spots to the sixth place in the 2017 Global Retail Development Index (GRDI), released by A.T. Kearney.
