Thailand’s leading retailers are pushing ahead with aggressive expansionplans into Vietnam as the deadline for the launch of the ASEAN EconomicCommunity (AEC) nears, according to the Vietnam Investment Review(VIR).
Chairman of the Hanoi Supermarket Association Vu Vinh Phutold VIR that scores of foreign retailers, including those fromThailand, had recently entered the market on anticipation of theestablishment of the AEC by 2015.
“Once AEC becomes a reality,enterprises in ASEAN would have more sale and business opportunities asthere will be greater regional economic integration and marketconvergence. Thai investors are well-known for their marketing capacityand are anticipating these opportunities,” said Phu, who is also ViceChairman of the Association of Vietnam Retailers.
AEC is likely to attract further foreign investors to Vietnam eager to make the most of tariff advantages, he added.
Accordingto the AEC Blueprint, a single ASEAN market and production base will beestablished, making ASEAN more dynamic and competitive thanks to thefree flow of goods, investment, skilled labour and easier capital flows.Goods will also cross borders more easily thanks to zero percenttariffs and the substantial dismantling of other trade barriers.
Thailand’sleading retailer Central Group recently announced its expansion inVietnam with next month’s launch of a Robins department store.
Thefirst Robins store, the group’s first international branch, will occupy10,000 square metres of retail space at Hanoi's Royal City. A secondRobins store will be opened in Ho Chi Minh City by the end of 2014. Thetwo stores will together hire 1,000 local workers.
Thaibillionaire Dhanin Chearavanont, Chairman of Charoen Pokphand Group (CPGroup), was recently rebuffed by German retailer Metro Group AG innegotiations to buy Metro Cash and Carry in Vietnam, in a deal that wasvalued at more than 500 million USD. CP may well return to the tablewith an improved offer.
Korsak Chairasmisak, Managing Directorof CP, said that Thailand wanted to take advantage of AEC. CPanticipated promoting small- and medium-sized Thai enterprises to thewider ASEAN market.
Thailand’s Berli Jucker (BJC), owned bybillionaire Aswin Techajaroenvikul, also previously bought theVietnamese Family Mart’s 42 retail outlets to establish a joint venturewith Vietnam’s Phu Thai Group. Phu Thai and BJC recently launchedB’mart, with Phu Thai saying that details of the deal would officiallybe released in September this year.
In December 2012, BJC hookedup with Mongkol Group in a 32.4 million USD joint venture to set upThai Corporation International Vietnam (TCI) to open a supermarket chainin Vietnam.
TCI Director Mongkol Banthrarungroj said the jointventure’s target was to promote its brand name in Indochina and exportThai products to Myanmar, Laos, Cambodia and Vietnam. TCI expected toincrease its sales in Vietnam to 3 trillion VND (150 million USD) onceAEC becomes operational.
Marketing communications and managementconsultancy company AT Kearney in a recently survey of corporate leaderson their AEC expansion, merger and acquisition and brand plans foundthat the majority of companies in ASEAN member countries such asThailand, Singapore, Malaysia, the Philippines and Vietnam planned toenter new markets, and create new products and brands to reach moreconsumers across the economic community after 2015.
“There is abig opportunity for Southeast Asian companies to embrace the ASEANmantle and create regional brands,” said Bob Hekkelman, Southeast AsiaCEO for world leading marketing firm JWT.
He added thatcompanies with insight into local tastes, cultures and attitudes had aninside track, but they would need to work hard to expand their reach,up their quality and build competitive brands if they want to woo theregion’s discerning consumers.
Phu added that besides AEC, underVietnam’s WTO commitments, from January 11, 2015, Vietnam would permitthe establishment of 100-percent-invested retail businesses. Currently,foreign firms are constrained by being forced to enter into jointventures with Vietnamese partners or franchising.
“AEC and WTO will provide opportunities, but also major challenges due to competition with foreign players,” said Phu.
Herecommended domestic retail enterprises to enter partnerships to buildbigger firms in anticipation of a massive influx of foreign retailersfollowing the further opening of the retail market to foreigninvestment.-VNA
Chairman of the Hanoi Supermarket Association Vu Vinh Phutold VIR that scores of foreign retailers, including those fromThailand, had recently entered the market on anticipation of theestablishment of the AEC by 2015.
“Once AEC becomes a reality,enterprises in ASEAN would have more sale and business opportunities asthere will be greater regional economic integration and marketconvergence. Thai investors are well-known for their marketing capacityand are anticipating these opportunities,” said Phu, who is also ViceChairman of the Association of Vietnam Retailers.
AEC is likely to attract further foreign investors to Vietnam eager to make the most of tariff advantages, he added.
Accordingto the AEC Blueprint, a single ASEAN market and production base will beestablished, making ASEAN more dynamic and competitive thanks to thefree flow of goods, investment, skilled labour and easier capital flows.Goods will also cross borders more easily thanks to zero percenttariffs and the substantial dismantling of other trade barriers.
Thailand’sleading retailer Central Group recently announced its expansion inVietnam with next month’s launch of a Robins department store.
Thefirst Robins store, the group’s first international branch, will occupy10,000 square metres of retail space at Hanoi's Royal City. A secondRobins store will be opened in Ho Chi Minh City by the end of 2014. Thetwo stores will together hire 1,000 local workers.
Thaibillionaire Dhanin Chearavanont, Chairman of Charoen Pokphand Group (CPGroup), was recently rebuffed by German retailer Metro Group AG innegotiations to buy Metro Cash and Carry in Vietnam, in a deal that wasvalued at more than 500 million USD. CP may well return to the tablewith an improved offer.
Korsak Chairasmisak, Managing Directorof CP, said that Thailand wanted to take advantage of AEC. CPanticipated promoting small- and medium-sized Thai enterprises to thewider ASEAN market.
Thailand’s Berli Jucker (BJC), owned bybillionaire Aswin Techajaroenvikul, also previously bought theVietnamese Family Mart’s 42 retail outlets to establish a joint venturewith Vietnam’s Phu Thai Group. Phu Thai and BJC recently launchedB’mart, with Phu Thai saying that details of the deal would officiallybe released in September this year.
In December 2012, BJC hookedup with Mongkol Group in a 32.4 million USD joint venture to set upThai Corporation International Vietnam (TCI) to open a supermarket chainin Vietnam.
TCI Director Mongkol Banthrarungroj said the jointventure’s target was to promote its brand name in Indochina and exportThai products to Myanmar, Laos, Cambodia and Vietnam. TCI expected toincrease its sales in Vietnam to 3 trillion VND (150 million USD) onceAEC becomes operational.
Marketing communications and managementconsultancy company AT Kearney in a recently survey of corporate leaderson their AEC expansion, merger and acquisition and brand plans foundthat the majority of companies in ASEAN member countries such asThailand, Singapore, Malaysia, the Philippines and Vietnam planned toenter new markets, and create new products and brands to reach moreconsumers across the economic community after 2015.
“There is abig opportunity for Southeast Asian companies to embrace the ASEANmantle and create regional brands,” said Bob Hekkelman, Southeast AsiaCEO for world leading marketing firm JWT.
He added thatcompanies with insight into local tastes, cultures and attitudes had aninside track, but they would need to work hard to expand their reach,up their quality and build competitive brands if they want to woo theregion’s discerning consumers.
Phu added that besides AEC, underVietnam’s WTO commitments, from January 11, 2015, Vietnam would permitthe establishment of 100-percent-invested retail businesses. Currently,foreign firms are constrained by being forced to enter into jointventures with Vietnamese partners or franchising.
“AEC and WTO will provide opportunities, but also major challenges due to competition with foreign players,” said Phu.
Herecommended domestic retail enterprises to enter partnerships to buildbigger firms in anticipation of a massive influx of foreign retailersfollowing the further opening of the retail market to foreigninvestment.-VNA
