Bright outlook for Vietnam retail industry

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Bright outlook for Vietnam retail industry

Vietnam retailers are rapidlyBright outlook for Vietnam retail industry securing market share in the domestic retail industry.

When Vietnam joined the World Trade Organisation, many feared traditional retail outlets and the newly developed modern domestic retail industry would crumble when faced by the financial power and technological advantages of multinational retailers.

But after five years, Vietnamese retailing is gradually changing, adapting to the new economic environment and enhancing its competitive ability.

The contribution of the domestic retail sector to GDP has increased to become an important factor of the economy. In 2005, the wholesale and retail sector accounted for 13.32% of GDP, this increased to 14.43% in 2010.

The wholesale and retail sector also provides large numbers of jobs. The number of workers employed in the wholesale and retail sector reached 5.5 million out of a total workforce of 49 million. It ranks third only after agriculture-forestry-fishery and processing, manufacturing sectors.

In total retail turnover of goods and consumer services 2010, the retail sector held the highest rate of 79% compared to other sectors such as accommodation and food services which accounted for 11% and tourism was 10%.

The country has more than 640 supermarkets and 100 shopping centres. Traditional retail outlets are also changing to adapt to modern consumer habits. At the end of 2010, nearly 8,600 new markets were established.

In the master plan for Vietnam’s commercial development in the 2011-2020 period and orientation to 2030, total retail turnover of goods and consumer services at actual price was set to increase 19-20% in 2011 and 20-21% per year in period 2016-2020.

In the developed countries, there is an average of one shopping centre per 100,000 people, a supermarket per 10,000 people and 1-3 convenience stores per 1,000 people. Vietnam’s retail market is much smaller but it is expanding rapidly.

Dr. Dinh Thi My Loan, Vice President and General Secretary of the Vietnam Retailers’ Association said, “The retail market in Vietnam still has space for both domestic and foreign investors.”

With a young population and the rapid development of internet, TV and tourism, consumer demand has soared.

In addition, customers are increasingly likely to turn to online shopping.

Addressing the challenges facing the retail sector, experts said the industry needed to change from one consisting of scattered traditional markets to effective, profitable outlets supported by modern distribution channels.

(Source by dtinews)

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