Nguyen Manh Duy, managing director of the Ocean Retail and Real Estate Management Company, says that Ocean Group, his parent company, plans to open between 70-80 supermarkets and shopping centres nationwide by 2015.
This will make the retail industry one of the group’s core businesses. The company also has two supermarkets-the Ocean Mart Ha Dong and Ocean Mart Thang Long-that are already in operation.
Duy says the gloomy domestic real estate market gives the company the chance to invest in the retail industry for much smaller overheads.
Son Ha group, a large domestic producer of home appliances and stainless steel products, has opened its first hypermarket in Ha Dong District, Hanoi, starting a new line of business.
Vu Vinh Phu, Chairman of Hanoi’s supermarket association, points to the fact that many firms are currently considering investing in the retail industry, especially as supermarket have become popular with consumers.
Meanwhile, CB Richard Ellis Vietnam, a property consultant and services firm, said that the approval of the Ministry of Industry and Trade’s plan for developing supermarkets and shopping centres by 2020 has had a positive influence on investors.
Under the plan, the nation is predicted to have between 1,200 – 1,300 supermarkets and 180 shopping centres by 2020, which will account for 45% of the country’s total retail revenue for goods and services.
However, Le Vinh Son, Son Ha Group chairman says that he delayed the opening of his second supermarket in 2012 due to business difficulties.
Phu echoes Son’s view, saying it is difficult for businesses in the retail industry at the moment because of a low purchasing power during the economic downturn. On top of that, developing a supermarket or a shopping centre’s trade mark is extremely difficult due to high competitiveness in the market.
A business needs only six months to build a supermarket, but it needs 10 years to develop and establish it with consumers, says Phu.
Enterprises still have the opportunities to develop a supermarket and shopping centre network, Phu says, but they must plan carefully, do the appropriate market research, source adequate quantities of goods and train their workers before launching a new chain of retail outlets.
Duy adds that the retail industry is the most competitive in the country, so a company must carefully nurture its supermarkets before it can reach a significant level of success in this sector.