Thaco opens two to three E-mart brand stores a year (provided by the company)
Vietnam's largest automaker, Truong Hai Automobile (Tako), will make a full-scale entry into the retail business. The large supermarket business acquired from Shinsegae Group, a major South Korean distribution company, aims to increase the number of stores to 20 by 2026 and achieve annual sales of 1 billion dollars (approximately 140 billion yen). We will capture demand from the growing middle-income class in Vietnam and develop it into a new source of revenue.
In September 2021, Taco acquired shares from Shinsegae in a company that operates large-scale supermarket chain E-mart in Vietnam. Signed an exclusive franchise chain (FC) contract with Shinsegae to sell e-mart's private brand (PB) products. Until now, it had only opened one store in Ho Chi Minh City, the largest city.
Delivery within 1 hour within 5 km radius
We will actively open new stores in the future. The second store will open in Ho Chi Minh City in October. The sales floor area is over 6,000 square meters, and the store will be opened in the shopping center (SC) "Tissot Mall". The company is aiming to open its third store in the city in December. It also develops online shopping that delivers products within an hour of ordering to customers living within a radius of 5 kilometers.
As a SC developer, Taco has a policy of being actively involved in store management. In addition to attracting not only supermarkets but also entertainment facilities such as restaurants and movie theaters, we aim to develop a unique store format that will also include sales and maintenance bases for cars produced by Octopus.
By 2026, the company plans to open eight stores in Ho Chi Minh City and six in Hanoi, the capital, and consider opening low-priced stores in rural areas. Aiming to become the largest supermarket chain in Japan in terms of sales. Chan Ba Duong, chairman of Octopus, expressed his ambition, saying, "It is possible to achieve $1 billion in sales with 20 stores."
Shinsegae opened its first Emart store in Vietnam in 2015. At the time, the company had indicated its intention to increase the number of stores to 10 within five years, but according to local media, it took time to obtain construction permits for the second and subsequent stores, making it difficult to develop the chain.
Octopus will use the ``knockdown method'' to produce cars including Kia Motors: state-run Vietnam News Agency
Octopus is Vietnam's largest automaker and has a factory in the central province of Quang Nam. In addition to developing trucks and buses under its own brand, it will produce passenger cars such as Japan's Mazda, South Korea's Kia Motors, and France's Peugeot using the "knockdown method" in which parts are imported and assembled locally.
Shopping places, shift to supermarkets
According to the Vietnam Automobile Manufacturers Association (VAMA), octopus-related automobile sales in 2021 totaled approximately 104,000 units, with a domestic market share of approximately 37%. Founder and chairman Duong was born in 1960 and is also known as a Vietnamese billionaire (with over $1 billion in assets).
Over the past few years, Vietnam's gross domestic product (GDP) per capita has exceeded $3,000, a milestone marked by an acceleration in sales of durable consumer goods and a major change in consumption styles. Vietnamese consumers' shopping destinations are starting to shift from traditional markets to supermarkets.
Aeon plans to open about 100 supermarkets by 2025, and Masan Group, Japan's largest retailer, will open 100 new stores per month from the spring of 2022. Aiming for
Active expansion into other industries
Major Vietnamese companies are actively expanding into different industries. A typical example is Vin Group, the largest private sector company with a real estate business at its core, entering the automobile business. Even if it is an industry that is far from its main business, it is trying to strengthen its earnings base by boldly challenging markets with high growth potential.
FPT, the largest IT (information technology) company, is opening more "Long Chau Pharmacy" drugstores. After acquiring a local drugstore in 2017, it built a store network and expanded into all 63 provinces and cities in Japan in 2022. By the end of 2022, we aim to have a total of about 800 stores.
Hoa Phat Group, the largest steel company, has increased its capacity in the steel business and has become the largest company in Southeast Asia. However, the steel market fluctuates greatly, making it difficult to stabilize business performance. “We will never be able to produce steel.
So do other companies. The Masan Group, which was primarily a food manufacturer, entered the retail business, while the FLC Group, which was primarily a real estate business, entered the aviation business.
Vietnam is a huge market with a population of approximately 100 million people and is attractive to foreign companies. In some cases, it is necessary to build relationships with the one-party rule of the Communist Party of Vietnam in order to break through various regulations.
