Vietnamese retail industry set to bounce back

February 11, 2022 - 09:18
Despite low growth in 2021, the local retail industry is still considered full of potential, promising to continue to explore areas for new growth.


Việt Nam's economy and the retail industry will have a great potential in the next 5-10 years with many favourable development conditions. — VNA/VNS Photo Mỹ Phương

HÀ NỘI — Despite low growth in 2021, the local retail industry is still considered full of potential and will continue to explore areas for new growth.

According to experts, modern retail distribution faces the biggest challenge in the last two years due to changes in customer trends, human resources, warehouse operation and the supply chain.

During the fourth wave of the COVID-19 pandemic in HCM City, the supply chain of goods suffered many fluctuations which the modern retail enterprises must respond to in its distribution system instead of the traditional role of providing goods to consumers onsite. 

During the pandemic, retail businesses invested in technological innovation and applied them in operations, business, and delivery services to fully meet the needs of customers.

MM Mega Market Việt Nam system has started a multi-channel sales development strategy, along with completing the online sales solutions: website MM Click & Get; Zalo and Telesales.

The system is also preparing to launch MMPro, an online shopping website for professional customers with product prices and solutions designed for each specific customer.

Similarly, Saigon Co.op, AEON, and LOTTE Mart are also pushing sales via phone, Zalo, assorted apps and e-commerce partners.

In addition, in 2021, major retail systems such as Saigon Co.op, MM, Central, Aeon, LOTTE Mart, and Emart have implemented cashless payment methods on both online and offline shopping channels. 

Experts forecast the COVID-19 pandemic will still be complicated in 2022, thus businesses must be well-prepared to stay up to speed during the recovery.

Nguyễn Anh Đức, general director of Saigon Co.op, said the firm’s 1,000 points of sale continued the development of modern commercial forms with advanced distribution channels to ensure the local consumption and to comply with world development trends such as online, e-commerce, cashless payment, contactless payment.

To avoid crowding during the pandemic, instead of focusing on developing physical stores, Saigon Co.op has focused on improving and perfecting its online sales channel and supply chain system, Đức said.

He added the trend of modernizing traditional sales channels and quick-selling models will soon come into practice while individual-customer-first serving is another trend.

“Retailers that optimise the experience for customer retention and apply multiple sales process metrics will have a better edge to dominate the market,” he said.

With a digital transformation strategy in the retail sector, focusing on customers according to the data-driven value chain model, Saigon Co.op is constantly upgrading technology for solutions for the collection, storage, and management and comprehensive data analysis, based on a solid, secure, flexible, and self-operating cloud computing infrastructure.

MM will continue to invest and develop multi-channel sales. The wholesale supermarket system will soon put into use Pick & Go software.

"MM's goal from now to 2025 is to become a leading food supplier in the retail industry," said an MM representative.

"We plan to open a smaller centre in the inner city with the Food service model, and Depot (storage and distribution) for the provinces to develop tourism and the Hybrid Food Service model – a place that combines shopping at the centre for household customers, and selling goods to customers at the same time."

AEON Việt Nam has focused on opening more business locations with a variety of retail models, including shopping malls, department stores and supermarkets, supermarkets, convenience stores and specialized stores; digital transformation, especially focusing on promoting O2O (offline-to-online); developing products to meet customer needs and making more efforts in sustainable development in terms of environment and social responsibility.

AEON Việt Nam General Director Furusawa Yasuyuki said it aimed to open 30 shopping centres by 2030 along with other models.

Emart with a new legal entity as THISO Retail, from Thaco Group, will put into operation two new shopping centres, which will be "one destination" for the Emart supermarket, wedding centre and car showroom.

Experts said that although the retail market in Việt Nam experienced a low growth rate due to the pandemic, it was still a potential market in the long term.

According to AEON, Việt Nam's economy and the retail industry will have a great potential in the next 5-10 years with many favourable development conditions as Việt Nam will be one of the leading countries for the expansion of the middle class in Southeast Asia, with growth of 9.2 per cent per year. 

Along with the rapid growth of the local economy and drastic change in the structure of the retail industry, the revenue of leading retailers is expected to be three times higher from now, according to AEON. — VNS