Retail giants eye expansion as economy looks up

By Vien Thong   October 25, 2022 | 03:26 pm PT
Retail giants eye expansion as economy looks up
Customers at Uniqlo Aeon Mall Hai Phong, which opened in May, 2022. Photo courtesy of Uniqlo
Retailers are planning to expand in Vietnam, which is poised to become one of the world’s 10 largest consumer markets this decade.

Japanese fashion brand Uniqlo said it would open a store at Vincom Ba Trieu mall in Hanoi this week and two others at Vincom Royal City and Vincom Tran Duy Hung to take the total number of its stores in Vietnam to 15 three years after entering the country.

Earlier this month Thailand’s Central Retail, the owner of hypermarket and retail chain GO!, said it plans to more than double the number of outlets in the country from the current 340 to 710 by 2026.

It will spend 30 billion baht (US$790 million) on the expansion, according to Japanese newspaper Nikkei.

It targets sales of 100 billion baht by 2026 compared to the current 38.6 billion baht, Olivier Langlet, CEO of Central Retail Vietnam, said.

South Korea’s Lotte, which has invested $5 billion in Vietnam, plans to set up a mall in Hanoi, chairman Shin Dong-bin said in late August during a meeting with Vietnamese President Nguyen Xuan Phuc.

Auto assembler THACO plans to open an E-mart supermarket in Sala Thu Thiem in HCMC this month. It already has a store in the city’s Go Vap District, which reported sales of VND1.6 trillion ($68.5 million) last year.

South Korean-owned E-mart entered Vietnam in 2015 and its local operations were acquired by automaker THACO last year under a franchise deal, which stipulates at least 20 stores must be opened by 2026.

Vietnamese supermarket chains such as Nova Market and WinMart+ are reportedly doing well.

This year Vietnam has attracted a lot of FDI in the wholesale and retail sectors, and more retailers have leased space in HCMC amid growing demand.

Total retail sales of consumer goods and services in the first nine months jumped 21% year-on-year to more than VND4.17 quadrillion, according to the General Statistics Office.

Analysts said the retail sector has recovered quickly after the Covid-19 pandemic was brought under control.

Colliers, a global real estate services provider, said the fact that some international agencies have raised their forecast for Vietnam’s GDP growth has sent a positive signal to big retail brands.

Vietnam is expected to become the world’s 10th largest consumer market by 2030, surpassing Germany and the UK, Tim Evans, CEO of HSBC Vietnam, said at an economic forum in September.

In Asia, Vietnam, Bangladesh and India will see the highest increase in consumer spending this decade.

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