Despite the pandemic, Vietnam's retail landscape is still heavy with potential, drawing an investment project of $1.1 billion by the largest Thai retailer, Central Retail Corporation.
|Central Retail Corporation from Thailand has drawn up ambitious plans for the next five years in Vietnam |
With a target of further expanding its footprint in Vietnam as a high-potential market, Thailand’s Central Retail Corporation (CRC) has come up with a five-year plan with an investment value of approximately THB35 billion ($1.1 billion) to cover 55 cities and provinces nationwide.
Yol Phokasub, CEO of CRC, revealed in a statement in early April that CRC is forging on with business expansion in Vietnam. “Thanks to strong collaboration from all sectors, Vietnam has emerged from the COVID-19 pandemic with a GDP growth rate of 2.91 per cent, the lowest growth for the market but still positive growth while most other countries reported an average 4.4 per cent reduction. Vietnam’s economy is predicted to bounce back to 6.8 per cent in 2021,” he said.
According to the company, Vietnam’s service sector posted 2.34 per cent growth, led by wholesale and retail trade with 7 per cent growth on year in the fourth quarter of 2020. It is expected to continue growing steadily in 2021. This makes Vietnam one of the fastest-growing and most lucrative markets in the world.
“Throughout CRC’s nine years of operation in Vietnam, food has remained a major category, contributing approximately 70 per cent of our total revenue. The company aims to elevate Vietnam’s retail sector while developing the ecosystem to serve as a ‘Central Retail Lifestyle & Food Platform’, solidifying the non-food category and enhancing the omnichannel platform. At the same time, CRC will continue our sensible and resilient way of doing business to create sustainable growth and carry on the vision of contributing to the country’s prosperity while improving people’s quality of life,” Phokasub added.
Apart from expanding business across Vietnam, in 2020, Big C developed omnichannel services in response to the COVID-19 crisis with 5 per cent sales contribution at the end of 2020 from 0 per cent at the beginning of the year, while Nguyen Kim experienced an 8 per cent proportion. Currently, the company operates 37 malls and over 230 stores across 39 cities and provinces nationwide, and plans to expand to 55 cities and provinces nationwide within five years.
Philippe Broianigo, CEO of Central Retail Vietnam, said, “CRC has set up a five-year roadmap with key focuses to expand multi-concept penetration in all clusters across city centres , as well as sub-urban and rural areas; revamp brands in the food category for better synergy and an enhanced customer experience; build brands for the non-food category and develop the omnichannel platform.”
In 2016, Central Group became the new owner of Groupe Casino’s Big C Vietnam chain after forking out $1.14 billion. This was one of the mergers and acquisitions mega-deals that shaped Vietnam’s retail space at the time.
In 2020, CRC opened four GO! Malls in Tra Vinh, Quang Ngai, Buon Ma Thuot, and Ben Tre, rebranded Big C to GO! (adding five more branches), while opening the first branch of GO! Supermarket in Tam Ky in the central province of Quang Nam to target rural customers.
In 2021, CRC continues its business expansion with an investment value of approximately THB6 billion ($191.5 million) Under the property category, the company will open four GO! Malls in Thai Nguyen, Ba Ria, Thai Binh, and Lao Cai provinces. Under the food category, it will open four GO! Hypermarkets, one mini GO!, and rebrand Big C to eight GO! Hypermarkets and seven Tops Markets.