Magazines Archives - 2007 December

Vietnam market ripe for the picking
Story 7

INTERNATIONAL retailers are poised to enter Vietnam come 1 January 2009, the deadline to which the country is committed, under the World Trade Organisation, to fully allow foreign retail companies into its retail market. At a press briefing last month, Rik Mekkelholt, manager of retail consultancy CBRE Vietnam, underscored the local retail market’s “great potential for growth, [which] attracts international players”. The country is held as the next fastest-growing economy after China, with a growth of 8.2% last year and an estimated growth of 8.4% and 8.7% for this year and the next, respectively.

However, overseas retailers will be up against the country’s shortage in purposebuilt retail space — with those built falling short of international standards — even as demand for space is increasingly exceeding supply, Mekkelholt warned. In Ho Chi Minh City alone are 13 shopping centres totalling 140,000sqm in retail space, while Hanoi’s six retail centres are sprawled over 100,000sqm of shop floor. The figures exclude the millions of traditional stores that make up 85% of the domestic retail market. Centres slated to open in the next four years include Saigon Paragon,C. T. Plaza, Happiness Square, the Everich, Asiana Plaza, Saigon Palace, Times Square, Saigon Pearl and Sports City in Ho Chi Minh City; and Ruby Plaza, Viet Tower, The Manor, The Garden and The Landmark in Hanoi.

German market research company GfK Vietnam sees the industry trending towards hypermarkets, supermarkets, shopping malls and convenience stores.