HEINEKEN Vietnam must check local distribution agents over anti-competitive accusations

HEINEKEN Vietnam was reported to have been squeezing local distributors to focus on promoting and selling its products

Recently HEINEKEN Vietnam came under fire due to allegations that it has been squeezing local distributors to focus on its promotions and sell its products, with the warning that they could see their monthly support cut if they continue to sell other brands.

HEINEKEN Vietnam categorically refused having such a policy or directing employees to make such threats. However, after an investigation, the MoIT’s Vietnam Competition and Consumer Authority (VCCA) stated on its website that “some agents confirmed that in fact there is a phenomenon of HEINEKEN Vietnam's sales staff asking them to implement this restriction but there is no official written notice.”

Following up, as directed by the VCCA, HEINEKEN Vietnam has issued an official public notice requiring the company's sales staff nationwide to strictly comply with the provisions of the Law on Competition and the company's internal code of conduct in all their activities.

The VCCA ordered beer producers and traders to strictly comply with the Law on Competition and to review and eliminate business policies that go against these rules or against consumers' interests.

The agency asked beer distribution agents and other related organisations and individuals to report similar cases to the VCCA. The move once again highlighted the fierce competition in the beer industry, especially in the premium beer and super-premium beer segments that are seeing the highest demand.

Currently, the Vietnamese beer market is crowded with competition. Many foreign companies are also looking to penetrate the high- and mid-end segments.

One of the methods to secure market share is to pay commission to agents to keep their distribution channels while preventing the entry of other brewers into their dominant regions.

However, to achieve long-term success and a strong foothold in the market, beer businesses must satisfy the needs and tastebuds of target customers, while at the same time making the best use of their resources and the company’s potential.