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The CrownX: Masan’s retail axis of existence for millions

By Minh Son   May 25, 2021 | 05:44 pm PT
The CrownX: Masan’s retail axis of existence for millions
Customers seet at a Phuc Long kiosk next to a VinMart+ convenience store in Ho Chi Minh City in May 2021. Photo by VnExpress/Quynh Tran.
With its recent mergers and acquisitions, private conglomerate Masan has unveiled plans to thoroughly dominate Vietnam’s online and offline retail markets.

At the heart of these plans is The CrownX, the unit that operates its VinMart chain.

The group announced Monday it would spend $15 million on a 20 percent stake in Phuc Long Heritage towards establishing thousands of tea and coffee kiosks inside its VinMart+ convenience stores.

The news came nearly a week after e-commerce giant Alibaba led a group of investors to sign a deal to pour $400 million into The CrownX for a 5.5 percent stake.

The two decisions showcase the company’s determination to develop its retail business, which it officially entered in 2019 by acquiring the VinMart chain from the nation’s biggest private conglomerate, Vingroup.

The decisions also indicate that Masan is looking at a much bigger picture than selling fast-moving consumer goods. It is eying the creation of an ecosystem which revolves around The Crownx.

The strategy, called "point of life," will make The CrownX the go to place for all essential needs on both online and offline channels, said Danny Le, CEO of Masan Group.

Starting with necessities like food to build a large customer base, the company will eventually meet all other demands for services in finance, education, entertainment and healthcare.

"The CrownX can be considered our first chapter," said CEO Truong Cong Thang.

Vietnam’s retail market is said to be young and fragmented. Modern channels account for only around 8 percent of the market, compared to 90 percent in Singapore, 60 percent in Malaysia and 34 percent in Thailand.

This means that most Vietnamese are still making their purchases at around 8,700 traditional markets and 1.4 million grocery stores nationwide.

For now, e-commerce only accounts for around 2 percent of the retail market, with most essential goods not being purchased online.

Masan wants to change this by first winning the offline channel. It has over 2,200 VinMart+ outlets and plans to open another 300-700 new new ones this year.

The partnership with Phuc Long is set to make VinMart+ even more popular as it will attract the younger consumers who like the tea brand. It will also help increase VinMart+ revenues by 4 percentage points.

For its online expansion, Masan is set to receive help from Alibaba, and its partnership with Lazada will make VinMart outlets, later rebranded as WinMart, pick-up points for online orders.

The group eyes a customer base of 30-50 million, or 30-50 percent of the nation’s population.

It estimates that when customers shop on just one Masan platform, prices of essential goods could fall by 15-20 percent, while manufactures and producers can save 15-20 percent in costs.

 
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