Japanese retailers expand in Vietnam, targeting affluent

By Vien Thong   March 21, 2023 | 03:29 pm PT
Japanese retailers expand in Vietnam, targeting affluent
AEON mall in Binh Tan District, Ho Chi Minh City. Photo coutersy of AEON
Targeting consumers not much affected by the difficult economic situation, Japanese retailers are opening more stores in Vietnam.

Uniqlo, which has 15 stores in Vietnam after entering three years ago, last month announced plans to expand to the southern province of Binh Duong with a first store to be opened this spring or summer.

Also in Vietnam for three years, MUJI opened a 2,000-square meter store in HCMC’s Thu Duc City that sells everything from food, home appliances and clothing to furniture, stationery and accessories.

Even amid the Covid pandemic and economic distress, it had five stores, three in HCMC and two in Hanoi.
Its stores in Vietnam are the largest anywhere at around 2,000 square meters on average.

"The size in Vietnam is almost double the average in other countries, including Japan," Tetsuya Nagaiwa, general director of MUJI Vietnam, said.

It plans to open more stores in Hanoi in the second quarter of this year, he added.

Aeon started building its seventh outlet in Vietnam in February in the central city of Hue. at a cost of U$169.67 million. It will be the largest mall in the central region when it opens by April 2025.

A recent business survey by the Japan External Trade Promotion Organization found that 100% of Japanese retail businesses in Vietnam expect profits to increase this year.

Of them 80% said they would expand in the next one to two years.

Japanese retailers are doing well partly because, like everywhere else, high income earners in Vietnam are recession proof.

"We see strong demand for high-value products," Nagaiwa said, adding that MUJI’s sales remained good because young consumers prefer its stationery, cosmetics and furniture.

Japanese chains also sell online shopping support made-in- Vietnam products.

In November 2021 Uniqlo started selling online through an application, and introducing Vietnamese agricultural products.

MUJI has steadily increased the local content rate and looked for local suppliers.

Nagaiwa said goods made in Vietnam account for 30% of its products and 97-98% in the case of products like T-shirts, backpacks and messenger bags. "We hope these numbers will increase in future."

After discovering that the Vietnamese stationery market only had the popular and high-end segments and not the mid-range one, MUJI started selling ballpoint pens for VND19,000 ($0.8), attracting students, who liked Japanese goods with minimalist designs.

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