By buying rivals and expanding networks, Vietnamese retailers are dominating the domestic retail market.

The retailer community last week was stirred up by the news that a Vietnamese enterprise had acquired a famous foreign retail brand just after one month of negotiations.

While other regional countries have made big leaps in developing their retail industries, the achievements gained by Vietnam have been modest in the last 10 years since Vietnam joined the WTO.

Vietnamese manufacturers are trying to display their products at foreign-invested supermarket chains, which have become familiar shopping destinations for urbanites. But it has not been an easy task. 

Vietnam should not try to restrict foreign retailers’ expansion, but instead support Vietnamese retailers by creating a level playing field, experts have said. 

VietNamNet Bridge - The Vietnamese retail market, though still small, is attracting the world’s giant retailers, including those from Japan.

Deputy PM Trinh Dinh Dung has instructed government agencies to consider applying measures to support Vietnamese retailers and controlling the expansion of foreign-invested retail chains. 

VietNamNet Bridge - The departure of the former owners of Big C and Metro Cash & Carry supermarkets is expected to intensify competition in the retail field.

Vietnamese retailers have been reassured that the regulation on ENT (economic needs test) would serve as a barrier that prevents foreign retailers from expanding in Vietnam and protecting local retailers. However, analysts don’t think this will work.

VietNamNet Bridge - Though the taxation agency has not received official reports about the Big C Vietnam transfer deal from involved parties, it is ready to work with the parties on collecting the tax. 

VietNamNet Bridge - Foreign retail chains have been expanding their networks under the cover of domestic retailers.

VietNamNet Bridge - If it enters Vietnam, Walmart will compete with Big C and other big foreign retail chains, and will be a formidable rival to Vietnamese retailers, analysts say.

 VietNamNet Bridge – Foreign retailers will have to do Economic Needs Test (ENT) on the basis of the population density of a district rather than a city or province when they want to open the second outlet onwards.