brands saturate beverage market
|Workers inspect a
bottling line at Thach Bich Mineral Water Plant in the central province
of Quang Ngai. Investors are finding niche markets in a highly
competitive industry by coming up with products that appeal to local
tastes, such as bottled green tea. — VNA/VNS Photo
HCM CITY — The Ministry
of Industry and Trade has said further investment in the beer and beverages
industry should be avoided in the face of stiff competition from foreign and
domestic beverage brands.
International, a global business consultancy company, said the country’s beer,
alcohol and beverages industry had seen high growth and would continue to do so.
However, the ministry
believes that the market is already highly competitive and any new players would
face difficulty competing with the many beer and beverages companies that
Despite the economic
slump, several beer and beverage brands have seen strong growth.
The Sai Gon
Beer-Alcohol-Beverages Corporation (Sabeco), for example, has seen a growth of
38.3 per cent last year compared to 2007 and its counterpart in Ha Noi, 28.3 per
Beer accounts for 97.9 per
cent of alcoholic drinks, and its production is expected to increase by 50.7 per
cent by 2013.
Many of the world’s big
beer and alcoholic and beverages corporations over the past years have made
investments in Viet Nam.
The Calsberg beer company
invested in the Hue Beer Company and Dong Nam A beer joint venture.
Other players, Heineken,
Tiger and San Miguel, also established breweries in Viet Nam, with a total
capacity of more than 700 million litres a year.
Beverages such as soft
drinks and bottled water are dominated by two giant firms, Pepsi and Coca Cola.
companies, aware of the public’s taste for traditional tea, have invested in
bottled green tea and energy drinks, gaining success in these sectors.
A representative of
Maximart Co-op chain said sales turnover of bottled green tea rose an average of
30-40 per cent a year in the last two years, leading to more investment in this
Tan Hiep Phat Corporation,
the first business to produce bottled green tea in 2006, recently invested US$20
million in a bottled herbal tea factory.
Tran Uyen Phuong, Tan Hiep
Phat Corp director, said her corporation had focused on diversifying products
such as bottled green tea and energy drinks to differentiate itself from soft
drinks made by Coca Cola or Pepsi.
With a market of more than
80 million people, Viet Nam is seeing beverage consumption grow sharply, largely
due to economic growth, urbanisation, the rising flow of foreign tourists and
foreign direct investment.
Ralf Matthaes, director
general of market research company TNS Indochina, said despite facing an
economic crisis in 2008, Vietnamese consumers did not reduce their spending on
Competition among beer and
beverage companies remains heated, and firms must constantly diversify new
products, improve quality and offer competitive prices to gain larger market
share, industry officials have said. — VNS