Digiworld sets foot in fast-growing FMCG sector

October 24, 2017 | 22:28

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Digiworld JSC, through its subsidiary Digiworld Venture, has announced completing the purchase of a 50.3 per cent stake in CL Co., Ltd. as a move to set foot in the fast moving consumer goods (FMCG) segment, according to newswire Cafef.

Digiworld JSC is buying into CL to enter the FMCG segment

CL is known as the partner of one of Lion Corporation, the top Japanese corporations in toiletry and household business. In 2001, CL started distributing Lion’s high-end FMCG products, including the Essence series, Kodomo, Fresh & White, Zact toothpastes, and Bio-Zip, Look & Top powder detergent, and Systema Toothbrush.

Through CL’s distribution network across 63 cities and provinces, Digiworld expected to save time in penetrating in the FMCG market, which has great growth potential.

Established in 1997, Digiworld is considered the leading market expansion services provider in Vietnam and is the authorised distributor of more than 30 world-renowned technology brands.

Digiworld has a distribution network with 6,000 points of sale nationwide and excellent tailor-made solutions, including the top five market expansion services customised to each client’s needs, namely market analysis, marketing, sales, logistics, and after-sale services.

In the third quarter of this year, Digiworld reported a net revenue of VND1.14 trillion ($50.1 million) with an after-tax profit of VND27 billion ($1.18 million), signifying increases of 10 per cent in net revenue and 14 per cent in after-tax profit. In the first three quarters, Digiworld earned VND2.69 trillion ($118.4 million) in revenue and VND56 billion ($2.46 million) in after-tax profit.

Regarding the potential of the FCMG sector, according to a report issued by the Ministry of Industry and Trade, the medium-term potential of the market appears strong. FMCG spending is expected to climb modestly to $173 billion by 2020.

The consumer market carries significant potential, and the penetration rate of many FMCGs has yet to be maximised.

Especially the rural regions, which are home to roughly two-thirds of the population and are almost entirely ignored by foreign companies entering the Vietnamese market, are considered a potential market for selling FCMG products.

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