13:31 | 25/11/2018 Trade
(VEN) - In the first nine months of 2018, the Vietnamese retail market continued growing. However, increasingly fierce competition requires domestic retailers to adapt to new retailing trends.
According to the General Statistics Office of Vietnam, total retail sales of goods and revenue from consumer services in the first nine months of 2018 reached an estimated VND3,235.1 trillion, a 11.3 percent increase compared with the same period last year. Specifically, retail sales of goods reached VND2,433.1 trillion, accounting for 75.2 percent of the total and up 12 percent compared with the first three quarters of 2017. The growth of the retail market reflects its draw for both domestic and foreign investors.
Do Thi Thu Hang, Deputy Director of Savills Vietnam’s Associate Director of Research and Advisory Services, said the Vietnamese retail market is developing rapidly with strong support of logistics and information technology systems. E-commerce in Vietnam has also grown, with online retail sales in the first nine months of 2018 increasing 35 percent compared with the same period last year, and e-commerce transactions growing 50 percent in volume and 75 percent in value.
Despite its rapid growth, the Vietnamese retail market faces fierce competition with the entrance/exit of companies. For example, Parkson Retail Asia, the owner and operator of the Parkson retail chain in Vietnam, has announced the closing of one more shopping center in Ho Chi Minh City, after facing continuous losses in the Vietnamese market.
Retail experts attributed Parkson’s failure to its department store model in which profit was shared, and companies hiring space had to pay management costs. However, nobody was responsible for marketing, while Parkson mostly sells products of high-grade brands. Due to its inability to find customers, Parkson has had no option but to close its shopping centers in Vietnam.
Meanwhile, many other shopping centers are operating successfully under more suitable models and due to favorable locations. Examples include Emart and AEON Mall with operations covering districts away from the central areas of major cities. These locations enable Emart and AEON Mall to offer retailers low stall hiring costs. Their customers can also use services from surrounding facilities. Emart and AEON Mall attract not only local residents but also those from nearby areas, especially during weekends.
Le Huu Tinh, Marketing Director of Emart Vietnam, said most shopping centers in Vietnam operate according to the multi-channel marketing model, combining offline and online sales via mobile phones and websites. Takashimaya, AEON and Emart are among the successful examples of this modern retailing trend.