fmcgvietnamvdelta

Race suffocation in the supermarket sector
From familiar names such as Lotte, Berli Jucker ... to rookies in Vietnam as Aeon, Cetral Group or Vingroup, 2014 witnessed a vibrant retail market.

With a population of over 90 million people and the majority of working age, Vietnam has become an attractive investment location for the retail industry - distribution. In particular, the door wide open in the ASEAN market in 2015, many items reduced tax rate of 0% is even encouraging foreign giants before pouring money to catch opportunities. Here are five giants in the field of supermarkets have joined the race drama about the market size in the past year.

1. Aeon (Japan)
Founded over 250 years ago from a store specializing in providing materials, clothing accessories kimono, far Aeon has become a global retail giants, appeared in 14 countries with revenues of nearly 60 billion years 2013.
Aeon began operating in Vietnam since 2009 in the form of a representative office and approved the company founded in 2011 with registered capital investment of nearly 205 million. This is the first step to developing Aeon construction activities, organization, business management and commercial centers, department store and supermarket. In early 2014, the company has declared truogn first commercial center in Vietnam, located in Tan Phu district (HCMC) and the end of the second center in Binh Duong.

Aeon's objective is to open in 2020 and operated 20 shopping centers and supermarkets across Vietnam. Meanwhile, across the globe, he grew a total of nearly 16,500 this center, shops.

Berli Jucker 2. (Thailand)
2014 is a busy time of the third richest billionaire Thailand - Mr. Charoen Sirivadhanabhakdi. After engaging in retail chain Family Mart (now renamed B's Mart), between 2014, the company Berli Jucker billionaire shocked the market when it bought hypermarkets Metro Cash & Carry Vietnam from German bosses.
Metro Cash & Carry Vietnam (Vietnam MCC) consists of 19 distribution centers and portfolio of real estate related, was bought for 655 million euros. After the deal, Berli Jucker into account the increase in the presence of Thai goods in supermarkets. She Metinee Issarajinda - Assistant Vice President in charge of investor relations, said the company BJC will send 10 experts to Vietnam to help structural adjustment items.

Also, Berli Jucker also plans to open 205 stores branded utility B's Mart in the next 4 years. In Thailand, the company has a market capitalization on the stock market is about 88 billion baht (about 2.8 billion US dollars). The Group has 6 offices in Southeast Asia with a total turnover in 2013 of about $ 1.3 billion.

Besides expanding the distribution system, while taking into account Charoen Sirivadhanabhakdi penetrate Vietnam beer market, which is the potential for double-digit growth. Thai Beverage - a subsidiary of billionaire others have recommended buying shares of Sabeco - the country's largest brewer. Thaibev currently owns two brands and Chang Beer Thai Oishi green tea. Sabeco company valuation of $ 2 billion.

3. Central Group (Thailand)
Following the successful boss in Vietnam's retail market, in 2014, the Group Central Group of Thailand's richest families Chirathivat official system is performed with Robins mall in Hanoi and HCMC.
4. Lotte (Korea)
In Vietnam since 2008, but the first 5 years of the Lotte supermarket (Lotte Mart) appears only in the southern provinces. To 2014, the Korean retail giants march into Hanoi with scale plans to open the first location has an area of ​​over 20,000 m2 and opened Lotte Center Hanoi - the second highest building with a total area cities 253,000 m2 floor.
5. Vingroup (Vietnam)
A new comer in the market, but not inferior Vingroup when planning large-scale expansion in the period itself is a business toi.Xuat real estate owned hundreds of thousands m2 business center as well as common areas luxury apartment in the big city, Vingroup available advantages to become retailers caliber. As early as 2013, the group has five bared penetrate through to birth mall chain for children and companies specializing in e-commerce.

Quarter IV / 2014, Vingroup officially entered the market, not through self-chain investment that acquires commercial centers Ocean Mall and Ocean Mart supermarkets of Ocean Group (Ocean Group). Vinmart retail brands and Vinmart + Vingroup also used for retail distribution systems around.

Initially, Vinmart conducted restructuring of existing supermarkets 13 Ocean Mart across the country, a total area of ​​over 40,000 m2. In the next 3 years, the company plans to expand to 100 supermarkets and 1,000 convenience stores across Vietnam through new investment or M & A.

Even in the last days of the year, marked the expansion Vinmart regain the 10,000 m2 floor of 79 Market stores, which belong Alphanam. Next time, Vingroup supermarkets will continue to expand into more residential areas, densely populated province in the country.

VIETNAM, ” THE NE

The growth rate of consumer spending (CAGR) of Vietnam in the 2011-2020 period is forecast to among the highest in the ASEAN region, reaching 8%, higher than the 5% both Indonesia and Malaysia, and the Philippines Thailand and Singapore and was 4% (source: Global Insights, Bain Analysis).

Many research reports by market research firm International is common that, Vietnam is emerging as a consumer market promising.

As estimated by BMI in reporting food and beverages from Vietnam, quarter 1/2013, the compound growth rate of food consumption (food consumption) Vietnam period 2012-2017 was 9.43%. In particular, the compound growth rate of canned food sales was 5.17%, 4.65% confectionery.

For beverages, compound growth rate of revenue is 8.47% coffee, carbonated beverages 6.96%.

Because of population structure among the youngest in the world, with 56% of the population under 30 years old (according to Nielsen), total consumer spending in Vietnam is expected to double and reach approximately 173 billion in 2020 (source: Euromonitor, Global Insight, Bain Analysis).

Nielsen also announced the growth of the market for fast moving consumer products (FMCG) in Vietnam as of 3/2012 quarter was 23%, surpassing the major markets like India, China (Grocery Report 2012- Nielsen).

Another important factor to promote more investment by business in FMCG sector is forecasting GDP growth of 7.2% in Vietnam will reach in 2017, according to estimates by the Economist Intelligence (Vietnam Country Report, January 4/2013-EIU, page 7).

As reported in the consumer goods sector Bain & Company’s new, Vietnam’s economy is developing very high speed, so retail spending will increase in all types of retail, especially Modern grocery, personal commodities and entertaining. In Vietnam, the “champion of indigenous retail” which has dominated in the model as a modern grocery, jewelry and electronics.

Research by Euromonitor estimates, the full-scale retail market in Vietnam will reach approximately $ 34 billion in 2016. The total retail market size of the real in 2011 Vietnam was $ 29 billion.

According to Euromonitor, the leading retail sector in Vietnam in 2016 will consist of garments; electronic; Modern grocery; health and beauty; personal goods and recreation; home and garden; Traditional grocery.

The strong growth will take place in sub-sectors such as modern grocery; personal goods and entertainment. Modern retail trends through modern channels will also place a stronger and gradually replace the traditional grocery form, which long existed in Vietnam linked to living habits and consumption of people .

In 2011, the traditional grocery distribution sector in Vietnam reached $ 11 billion scale, the forecast market size in 2016 will drop to 10.7 billion (down 1%).

However, if the 2011 model new modern grocery market size reached $ 1.6 billion, the 2016 is expected to increase to 2.8 billion (up 12%).

Similarly, in the field of personal goods and recreation scale will also increase from 2.4 billion in 2011 to $ 4 billion in 2016, up 11%.

Bain’s analysis may partly explain why large FMCG firms of Vietnam as Masan, Vinamilk, Kinh Do … again can win in front of the big multinationals, which are very strong in terms of capital and distribution systems.

The key element to the success of domestic enterprises listed Bain include: (1) local scale, (2) ability to lead on price, (3) the localization factors.

In summary, according to Bain, the loyalty of our customers is very important for local businesses to win in the retail sector. It is vital that the consumer business in the country is pretty well positioned.

In some cases, even corporations multinational retailers like Walmart and glorious defeat, failure to grasp the key to “localize”. Walmart had failed in Korea, because the group does not know how to adjust business strategy to suit the local market. In other words, they do not do so, “South Korea” of his brand here.

The recent analysis of Vietnam cunng consumer sector showed revenue growth potential of the sector is not large. Total revenue of the areas related to consumer products in Vietnam is expected to rise to $ 140 billion in 2016.

In particular, the growth of real spending by consumers (CAGR) 2011-2016 was 3% in the retail, consumer goods (non-food and beverage) 6%, food and beverage industry Other 3% (source: VINaconnect Report, Euromonitor and Bain Analysis).

According to Euromonitor reports and Bain Analysis, expenditure in the field of food and non-alcoholic beverages in Vietnam could reach 276 billion dollars by 2016.

With a per capita income is increasing, reaching about $ 1,521 in 2012, Vietnam’s market promises to be the new star of consumer goods in Asia.

But the remaining problem is whether Vietnam can now take advantage of the great opportunity or not?

W STARS” CONSUMER GOODS

THE APPEAL FROM THE CONSUMER GOODS M

(VEN) – Sector in FMCG (Fast Moving Consumer Goods – FMCG) in Vietnam is much fertile land and potential for investors because Vietnam is rated one of the leading markets the world leader in consumer confidence levels with retail sales growth averages 24% / year. Add to that Vietnam is emerging as an attractive investment location, with 90 million people, a young population and rising incomes and urbanization rate strong.

We can see the development of the market economy has helped Vietnam become one of the fastest growing economies in the region, has stimulated and promote consumer spending strong, with growth consumer spending growth averaged at 17.2% / year.

According to the General Statistics Office, the total turnover of retail goods and services reached 2.32 million in 2012 billion, up 16% compared to 2011. The largest contribution to the figures, in terms of business group’s commercial sector accounted for 77.1%, equivalent to 1,789 million billion, up 15.2% from the same period in 2011. The other sectors, hotels and restaurants contributed 11.8% services and tourism accounted for 10.1% 1%. In terms of economy, the external sector reached 1.968 million state billion, accounting for 84.8% and increased 18.4% compared to 2011. The area of ​​foreign investment at 67.4 trillion billion, representing 2.9% and an increase of 34.7%. State economic sector closed 288.9 trillion, accounting for 12.3% and decreased by 1.2%. In 2013, trade and industry aims to reach total retail sales of goods and social services in 2013 about 2,742 million billion, up 18% compared to 2012. The growth figures are an important foundation for industry consumer goods in Vietnam continues to grow strongly and attract investors directly and indirectly.

Additionally, when compared to countries in the area of ​​consumer goods Vietnam has also grown rapidly in Asia in 2012, the last with 23%, compared with 18.8% and India with the Middle Korea 13%. So Vietnam is emerging as an attractive location for investment due to 90 million people, a young population and rising incomes and urbanization rate. With a young population joining the labor market, average spending per consumer of Vietnam will continue to increase in years 2012- 2016 is an important basis for promoting consumption. According to statistics in 2012, spending on food and beverages by consumers Vietnam reached 276 USD / person / year. It is expected that by 2016, total consumer spending for food and beverages will rise to 25.2 billion compared with 17.7 billion in 2011.

Especially market consumer goods in Vietnam in recent years also witnessed many acquisitions and mergers (M & A) and activities continue to be active in 2013 by foundation consumer market Vietnam remains very good, especially the young population and rising incomes; However the domestic consumer goods companies are experiencing difficulties in funding due to high interest rates; As the market develops, as a rule eliminated, companies need to build core values ​​and human investment. Lack of experience both capital and development forced the domestic consumer businesses to seek investors. Therefore, the consumer market in Vietnam is expected to be more mergers and acquisitions (M & A) in 2013 as still attractive to international investors.

Proving this fact some foreign investment funds like VinaCapital, Dragon, Mekong … very interested in investing in the field of consumer goods dung.Hien VinaCapital has invested in over 50 leading enterprises in all economic sectors in Vietnam, especially in the consumer goods industry and most of the investments in companies that consumers equally positive results. In addition to investment funds, the largest consumer companies in Vietnam such as Pepsi, Vinamilk … or large enterprises overseas consumers are also willing to invest in the consumer sector in Vietnam to have a chance. 1/2013 of the most recent month one of the biggest deals Kohlberg Kravis Roberts is firm (KKR) based in the United States increased $ 200 million investment in Masan Consumer Corporation.

ARKET VIETNAM

UNILEVER AND VINAMILK MARKET DOMINANCE FMCG

As reported by Brand Footprint, Unilever holds the top spot in the countryside while Vinamilk leading urban charts.

Results reported the prevalence brand (Brand Footprint) Kantar Worldpanel as the company specialized in market research FMCG group has just announced shows, Unilever holds the top spot in the countryside while giants “internal “Vinamilk led the rankings in urban brand manufacturers are purchasing most 2013.

Specifically, with the own brand, product manufacturers FMCG (FMCG) global giant Unilever was to purchase more than 400 million times / year in the countryside and keeping the dominant position than any Any manufacturer with market penetration deepest – more than 99% of households in both urban and rural areas are using Unilever products at least once in the past year.

In rural areas, the leading brand in the field of health & beauty and home care are owned by Unilever and P / S, Clear, Lifebuoy, Omo, Sunlight and Comfort helped bring about 350 million CRP point for this manufacturer.

In urban areas, Unilever was ranked No. 2 in the rankings, with products consumers choose to buy 57 million times in the past year. Notably, brand P / S and Unilever’s Omo are two leading brands in each of its sectors in urban and rural areas.

THE REAL

THE REAL SURPRISE IN THE FMCG SECTOR

SURPRISE IN THE FMCG SECTOR

FMCG sector (FMCG) sector, also known as consumer packaged goods (CPG) is forecast to nearly double the value in the next ten years, from about 8,000 cabinets up to 14,000 USD 2014 billion in 2025. That equivalent to predict there will be about 81 corporations like Kellogg in the next decade. The industry increasingly fierce competition, especially in BRICs as Brazil, Russia, India, China. Companies in this sector have managed to like?

Three unexpected truth

The McKinsey has studied the market of more than 2,600 cities in the world and turned out almost exactly what was wrong all along.

First, the US and Western Europe are not all capable of growth. Most companies believe that this is only CPG market distribution system struggles to maintain market share. But not so. Not just growth, but the market in many cities in the US and Western Europe is growing fast is not inferior to the emerging markets. Ignoring these markets, the company CPG missed opportunities at home. According to research, the industry as anti-aging cream, beverages, mineral water, … will grow twice the current level of spending.

Secondly, these new brands joining the facility did not have enough financial firm faces a mistake to assume that it is too late to enter into the Chinese market or India, due to stiff competition. Actually, if they choose the main city to be present, the ability to dominate their market will expand. With these sectors have requirements on lower minimum scale, the market just joined in these markets alone (in some major cities) can also bring revenue equivalent to the coverage on Nationwide in other emerging markets – even higher. For example, the juice industry, particularly in Shanghai, will grow at three times the size of the market and more than the Malaysian market.

Moreover, many cities in China and India are modernizing infrastructure and retail distribution, makes this market penetration of less complex in the rural area.

Thirdly, the fact completely the opposite of what they have long believed, that consumers in emerging markets will not buy high-end products. The fact is, in the large cities of developing countries, higher per capita income levels equal to or even higher than similar cities in North America or Europe. The structure of the needs of local people in the city are also equivalent and similar growing needs in cities in developed countries. Products such as high-end cosmetics, infant toys, pet food … The company can meet the demands of this rapidly soon will be positioned as the leader market direction, even create momentum for other needs. A typical example is P & G infiltrated China with products diapers children when markets were only accustomed to using cloth diapers, has instantly become the brand is the first choice and quickly served as the user segments such goods in China.

Develop strategies for the micro market

From the results of the report, the researchers have suggested a different approach to the market and developing countries (especially the BRICS group) – to gain market share equal to or greater than the national market other. One example is the study of the city with average size with a population of between 20000-50000 people in Brazil, but the average growth rate of 7.5% annually and bring the equivalent expenditure about half the total expenditure of the entire population of Brazil. As sunscreen industry or baked products also can bring growth rates double or tooth rise to 50% respectively. Meanwhile, in India, the market growth will come from the urban areas – are concentrated in the 70 most populous cities – accounting for about 1/7 of the population contributing sales of over 1 / 4 for a total value of this sector from 2014-2025 drinks.

So to penetrate this market, experts suggest the problems that corporations CPG offering is as follows:

1. Analysis of hot spots: the top 100 leading city that we should build presence to achieve growth ambitions are the city?

2. Select a product category: the main branch and the side with the largest growth potential in that city?

3. Check the market: market conditions particular we expect?

4. Allocation of resources: the geographic area should be allocated more resources to ensure our future growth?

For the poo in the developed countries where the market has more coverage and lower growth potential, the following questions are important:

Preliminary data analysis: the city or the niche market that has the best growth opportunities for our products?
Check presence “How strong we are when present in high-growth areas?
Market positioning: high growth in certain areas of our market share is below average?
Resource allocation: bureaucracy we have to reallocate the investments and manpower for the industry the highest growth area yet?
Answering these questions can provide the basis for decisions on the product portfolio, market costs, labor and putting the production plant or distribution center for training CPG Corporation.