VietNamNet Bridge - The market share of Vietnamese sweets manufacturers is getting smaller.


At Big C, Lotte Mart and Aeon Citimart, the largest supermarket chains in Vietnam, foreign-made sweets, which are expensive, which have ‘reasonable selling prices’, are displayed on the most advantageous positions on the shelves. 

This is, according to analysts, understandable: foreign-made products can sell well and they need to be displayed in a way so as to easily catch consumers’ eyes.

Domestic manufacturers’ piece of cake getting smaller

According to Business Monitor International (BMI), a market survey firm, the Vietnamese sweets market was worth VND26 trillion in 2013 and VND27 trillion in 2014. The figure is expected to rise VND40 trillion by 2018.

The market share held by Vietnamese manufacturers has shrunk.

However, the market share held by Vietnamese manufacturers has shrunk.

In fact, there were many Vietnamese ‘big players’ in the sweets market, namely Kinh Do, Bibica, Huu Nghi, Hai Ha, Hai Chau and Pham Nguyen. 

However, Kinh Do has just sold 80 percent of the sweets manufacturing division to Mondelez from the US. Meanwhile, 44 percent of Bibica’s stakes now is held by a South Korean investor.

There is another important reason why Vietnamese products are seen less in the market. A series of supermarket chains have changed hands, now being run by powerful retail groups from the US, Japan and South Korea. The retailers have brought more foreign-made products into their distribution networks.

Pham Thi Thanh Thao, deputy general director of the Vietnamese-owned Pham Nguyen JSC, noted that competing fiercely with multinational groups was inevitable.

“The imports from ASEAN countries now flood the market thanks to reasonable prices,” she said, adding that the import volume has increased by many times.

According to the HCM City Food & Foodstuff Association, Vietnamese manufacturers have to import parts of materials and machines at high prices; therefore, their products don’t have high competitiveness compared with import products.

Reform or die

However, analysts believe that if Vietnamese manufacturers reorganize their production and improve management skills, they will still have room in the market.

The latest report by Kantar Worldpanel, a market survey firm, showed that the sweets market has been growing very strongly. The sales of biscuits, for example, had grown by 7 percent in urban areas and 6 percent in rural areas by November 2015.

Nguyen Huy Hoang from the firm noted that while imports can sell well in cities, domestically made products sell better in rural areas.

“Both Vietnamese and foreign made products have their own advantages. If Vietnamese manufacturers can have reasonable development strategies, they can take full advantage of the home market and win Vietnamese hearts because they sell Vietnamese goods,” he said. 


PL TPHCM