International retail firms and supermarket operators have long considered Vietnam an attractive market, with its emerging middle class, increasing incomes, and young population craving more modern trade.
As the new generation of Vietnamese consumers moves from wet markets and mom-and-pop shops to more sophisticated and bigger retail stores, the presence of international brands is opening up a whole new shopping experience in Vietnam.
Data from the Ministry of Finance show that foreign investors poured more than $9 billion into Vietnamese retail and wholesale markets in 2021 amidst COVID-19 complications. The sector showed incredible resilience as Vietnam battled and overcame outbreaks.
Revenue from total retail sales and services during the nine months of 2022 also sharply increased by 21% year-on-year, even surpassing pre-COVID levels.
With a market value of $170 billion and an expected growth rate of 10% in the next five years, Vietnam’s retail sector will continue to be a driving force of economic growth and a significant factor for foreign direct investments.
Thailand’s Central Retail, which already has about 340 stores in Vietnam, announced its plans to “more than double its footprint” in the country, a report from Nikkei Asia reads. The retail arm of Thai conglomerate Central Group, Central Retail, plans to spend $790 million to build at least 370 more stores in 55 of Vietnam’s 63 provinces over the next five years.
Central Retail has seen steady growth in Vietnam since it started operations in 2012. Reporting more than $1 billion in revenue last year, Vietnam is the retailer’s second-biggest earning market outside of Thailand.
By 2026, Central Retail's stores in Vietnam will offer various formats to sell food and non-food products, Olivier Langlet, CEO of Central Retail Vietnam, told Nikkei Asia. The company also plans to ink partnerships with shopping centers to host Central Retail brands, including Go!, Top Market, and SuperSports.
The company also expressed interest in opening a shopping mall in the Mekong Delta province of Dong Thap.
Aeon Mall in Tan Phu Celadon, one of the country’s largest shopping centers, attracts over 1.5 million shoppers and visitors a year. With its collection of supermarkets and restaurants, a world-class cinema, and a vast food court that offers different varieties of cuisines, Japanese-founded Aeon is the place to be for modern shopping. It also houses popular fashion, cosmetics, and sports brands beloved by many Vietnamese.
Aside from its Tan Phu branch, the “super retailer” operates five other malls, another one in Ho Chi Minh City, two in Hanoi, one in Hai Phong, and one in Binh Doung.
The Japanese retailer had been exploring the Vietnamese market since 2009 before it officially opened Aeon Tan Phu in 2014. The retail giant has poured nearly $2 billion since and plans to scale up to around 10o supermarkets by 2025.
In a meeting with Prime Minister Pham Minh Chinh in November last year, Aeon CEO Motoya Okada said they consider Vietnam as important as its main market in Japan. The company also plans to list on the Vietnamese stock market and promote the exports of Vietnamese seafood and garments to Japan, according to a report by Tuoi Tre.
The groundbreaking of Lotte’s $900 million shopping center in Ho Chi Minh City on September 2 signaled an important step for South Korea’s fifth-largest chaebol in deepening its presence in Vietnam’s competitive retail landscape.
Lotte Group chairman Shin Dong-bin was present at the kick-off ceremony of the construction of the Lotte Eco Smart City Thu Thiem.
“Since entering Vietnam with the food group in 1996, Lotte Group has been expanding its business in distribution businesses such as shopping malls and marts, and in various fields such as food, hotels, and chemicals, employing about 20,000 employees,” Shin told the local media.
After a geopolitical fallout with China in 2018, Lotte Group has been giving more attention to the Vietnamese market. The company currently operates 270 Lotteria restaurants, 15 Lotte Mart stores, two department stores, two hotels, and two duty-free stores in Vietnam, employing approximately 60,000 people.
Lotte plans to build the best smart complex in Vietnam by 2030 and intends to provide over five million jobs throughout the project. Furthermore, it’s eyeing other multimillion-dollar investment projects in the country, including a trading center in Hanoi.
The group also launched Lotte Ventures Vietnam last year to support Korean startups aiming to penetrate the Vietnamese market.