A growing number of foreign companies are eyeing Vietnam’s retail market, which is becoming an increasingly attractive sector for manufacturers and distributors of imported consumer products, said a recent seminar.
Consumption expenditures in Vietnam in 2006 amounted to VND581 trillion (US$36.31 billion), an on-year increase of 20.9 per cent. The figure is expected to increase to US$53 billion by 2010, according to figures released by the Vietnam Chamber of Commerce and Industry (VCCI) at the seminar held last week.
Vietnam obtained a GDP growth of 8.2 per cent in 2006, and now ranks second in Asia in economic growth rate, the gathering was told.
Vietnam ranked fourth among 30 hottest retail markets worldwide, scoring 74 points in General Retail Development Index (GRDI) 2007, said the report by the AT Kearney Consultant Group. India took lead with 92 points, followed by Russia with 89 points and China 86 points.
To observe its commitments to the WTO, Vietnam plans to open its gates to foreign retail companies and franchisers, said attendants at the gathering.
US companies will be allowed to form joint ventures with Vietnamese firms beginning from January 1, 2009, setting up wholly foreign-owned companies with the right to import goods as well as manufacture domestically.
With expectations for significant change in Vietnam’s retailing system, foreign investors are massively entering the market and increasing their market share, according to seminar participants.
“The pie is huge, yet the competition is getting much harder. Hopefully for the coming years, advanced management techniques will gradually be applied widely to improve local companies’ effectiveness and competitiveness against foreign retail companies,” said Tran Van Bach of the Ho Chi Minh City Economics Institute.
The seminar, held by the VCCI in coordination with BLogic Systems Vietnam Co., was entitled “Golden Solutions to the Development of Vietnam’s Retail Industry”.
The seminar’s was aimed to inform local businesspeople about the latest news on sales management techniques and business trends while introducing viPOS technology for retail business management.
The annual average expenditure for goods and services per capita of Vietnam has been doubled over the past five years, surging from VND3.5 million (US$218,750) to VND6.9 million (US$431,250), said the General Statistics Office (GSO).
Vietnam’s total retail sales of goods and services in the Jan-Jul were estimated to have risen by 23.1 per cent on-year to VND394.5 trillion (US$24.7 billion). (VNA)
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