“I was able to get many clients after drinking bouts or banquets. Vietnamese will become open-hearted after they clink glasses with you,” said Xuan Tung, a 24-year-old security broker.
Drinking beer is a feature of Vietnam’s culture. Vietnamese drink beer to celebrate a victory, to make acquaintances and to show apologies to friends. They drink beer everywhere, in both luxury restaurants and pavement beer shops.
This is why ‘beer streets’ like Ta Hien in Hanoi are still crowded in winter, while the road next to Nhieu Loc Canal in HCMC is full of beer drinkers from 4pm until midnight.
In its report released in mid-2017, Euromonitor International predicted that Vietnam will be the next major battlefield for brewers.
“While volume sales are struggling in the leading markets, SE is forecast to see absolute volume growth of 2.3 billion litres over 2016-2021, led by Vietnam,” the report says.
This is not only because the market is attractive, but also because the State has turned the green light on for foreign investors so they can plan to divest shares in the two biggest Vietnamese brewers.
Foreign investors have shown their willingness to buy into Habeco and Sabeco. Thaibev paid a high price of US$5 billion to acquire Sabeco’s shares.
While the average beer consumption volume in the world hasn’t increased over the last decade, sales in Vietnam have been soaring steadily. In 2008, Vietnam ranked eighth in Asia in beer consumption. Eight years later, it jumped into the third position, just after Japan and China.
According to Ban Viet Securities (VCSC), the Vietnamese beer market is controlled by four big manufacturers, namely Habeco (Hanoi Brewery), Hue Brewery (100% owned by Carlsberg), Sabeco (Saigon Brewery) and Heineken NV.
Of these, the first three brands are dominating local markets (northern, central and southern regions), while Heineken beer products are dominating the mid-end and high-end market segments.
ThaiBev, which runs one of the largest supermarket chains in Vietnam and holds 53% of shares in the largest Vietnamese brewers, is expected to bring Chang beer, a brand well known in the Thai market, to Vietnam and make Chang a rival here.
Singha, another well-known Thai brand, has spent US$1.1 billion to buy Masan Consumer shares in 2015.
Meanwhile, Kirin Holding’s spokesman in Tokyo has confirmed that Vietnam will be one of the key markets for the brewer in 2018 and the following years.