Foreign retailers investing in Vietnam’s fledgling market have just one year of regulatory protection left before the opening of wholly foreign-owned retail businesses will be permitted, Inside Retail Asia reports.
Despite early entrants into the market reporting losses since first being granted permission to open stores in 2009, the challenges faced are not deterring new arrivals.
The most recent global retailer to announce its debut in Vietnam is leading developer of Thai shopping centres, Central Pattana, which is currently in talks with a Vietnamese partner to develop its first shopping complex in the new market.
Central Pattana’s subsidiary is set to open the first 7-Eleven stores in Vietnam within the next three months.
The company joins Korea’s Lotte Mart and Germany’s Metro Cash & Carry, which has both established small but high profile presences in Ho Chi Minh, Vietnam’s largest city.
Thailand’s Big C has opened 17 outlets in conjunction with France’s Group Casino and aims to open 12 more within the next 12 months, which would make it the holder of the leading network of large format supermarkets.
Big C is mirroring its domestic strategy by entering smaller rural cities where it will face limited competition.
Japan’s Aeon is set to open the first of four new shipping centres it has planned for Vietnam in early January.
While the country presents a consumer population of 90m, organised retailing is still in its infancy. With just 700 supermarkets nationwide at the end of 2012, 40 per cent of them were foreign owned.
Some domestic retailers are concerned regarding the coming era of foreign investment, given that international developers will have access to far greater capital reserves than their Vietnamese counterparts.
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