More than a year after joining the World Trade Organisation (WTO), Vietnam has seen positive changes. This is reflected in retail, with the participation of big, global corporations. It is also a challenge which domestic retail companies have to face. Vietnam Business Forum’s reporter Anh Tuan has a talk with Mr Nguyen Huu Thang, President of Hanoi Trade Corporation (Hapro), about this issue.
What difficulties will Vietnamese retailers meet when big foreign supermarkets have deeper penetrated the country’s retail system?
The retail market is very hot, influencing most people. It is really hotter when international retail corporations such as Metro and Big C operate in the Vietnam market, bringing changes to the market which is not yet developed. Costumers have the opportunity to buy many kinds of commodities.
However, it also brings some disadvantages if the corporations cover the entire Vietnam market. Vietnamese enterprises have to change their business methods to compete in retail. We have received many invitations to cooperate with international corporations, but we refused to avoid danger of take-overs.
To get advanced technology, we must pay a high price for foreign experts to share their experiences and cooperate. Vietnam enterprises are expected to become strong corporations in the domestic market in the next 5-7 years.
Vietnam supermarkets are small compared with big corporations. Don’t we have supermarket business technology?
It is very difficult to compete with famous trademarks. Domestic enterprises have advantages in legal procedures, location and human resources when opening supermarkets, while facing the disadvantages of limited financial potential and the shortage of supermarket business technology. We must admit unavoidable difficulties in competing with big, global corporations.
I want to add that customers should pay attention to gimmicks used by the big corporations.
Now, customers are worried about fake and low quality commodities sold in supermarkets. What has Hapro done to ensure the quality of goods?
With various kinds of imported commodities, controlling the quality is not easy. However, we only accept goods with clear origin; goods supply units must have business licenses and all relevant certificates ensuring quality. Recently, the media has mentioned unsafe vegetables and food, but unsafe food is still found in supermarkets. I affirm that Hapro sells safe vegetables because we signed contracts with our own clean vegetable production areas.
Hapro has opened 12 new branches in the last year. What are the reasons for this move?
Hapro has chosen to open shops and medium supermarkets in residential areas, rather than opening big supermarkets. We are confident of positive changes in Vietnamese people’s habits regarding using safe goods. Therefore, the first Hapro supermarket was opened in Giang Vo street, so far we have six more branches in Hanoi and six others in Bac Kan, Thai Nguyen, Ninh Binh, Thanh Hoa, and Hung Yen. Hapro targets to open another 15 new branches in 2008.
To date, many residents are not in the habit of using goods from supermarkets because of higher prices compared to outside markets. What has Hapro done to overcome this and attract customers?
There are many kinds of goods in supermarkets. Hapro has between 15,000 and 20,000 different commodities for customers to choose from. Moreover, goods in supermarkets are safe and have dependable quality, so the price is higher, but some goods also are sold with lower prices, depending on imported prices and business strategies.
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