Distribution commissions challenge manufacturers

Do Thang Hai, Deputy Minister of Industry and Trade and Deputy Head of the Buy Vietnamese Goods campaign’s Central Steering Committee

The Buy Vietnamese Goods campaign has been implemented for 13 years, increasing the proportion of Vietnamese products in supermarkets to 80-90 percent. How will the industry and trade sector further expand the presence of Vietnamese goods in distribution channels and raise the number of Vietnamese commodity buyers?

Priority will be given to increasing the presence and sales of Vietnamese goods in supermarkets and other distribution channels. The ministry will provide training and technical assistance in production, packaging and marketing for farmers, cooperatives and businesses, helping them access major distribution systems. It will also provide the latest information about importing countries’ laws, especially food hygiene and safety regulations, and crack down on counterfeit goods.

The ministry has worked with leading distributors, including Central Retail, AEON, and MM Mega Market, among others, to help Vietnamese goods enter their Vietnam-based and overseas supermarkets. For example, the ministry signed an agreement with AEON, under which AEON will sell US$1 billion worth of Vietnamese goods each year until 2025. It also worked with Central Retail to hold Vietnamese Goods Weeks in Thailand and bring Vietnamese goods to the group's distribution systems in different countries.

Vietnamese businesses have to pay a 20-25 percent commission to supermarket distributors. What is the Ministry of Industry and Trade doing to lower the rate?

The Ministry of Industry and Trade has negotiated with major distributors to lower the high commission rate charged for selling Vietnamese goods through supermarkets.

For example, we worked with distributors like Central Retail to lower the commission rate for Vietnamese businesses and cooperatives. As a result, a number of distributors have applied a 0 (zero) percent commission rate to Vietnamese farm produce for a relatively long time.

The ministry also requested relevant authorities to strengthen market inspection and control to ensure Vietnamese produce presence in distribution channels.

Increasing the competitiveness and presence of Vietnamese products in distribution channels

A number of Vietnamese suppliers fall short on product quality and volume commitments. What do you think about this?

Good suppliers must meet product quality standards, including food hygiene and safety, and supply sufficient, stable amount of goods to which they committed with distributors.

The connectivity between businesses and industry associations remains poor, leading to scattered production investment, while efficient connectivity is crucial to creating a large amount of goods meeting domestic market and export standards.