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Vietnam’s Retail Industry: Overview 2024

As of 2024, Vietnam’s retail industry continues to show promise, driven by a rising middle class, increased consumer spending, and a young population. The sector has increasingly embraced digital transformation, with e-commerce rapidly expanding alongside traditional retail channels. Online shopping is gaining popularity, particularly among younger consumers, spurred by mobile technology and changing shopping behaviours.

The government has implemented supportive policies to attract foreign investment, including the gradual liberalisation of the retail market. Free trade agreements, such as the EVFTA and CPTPP, have further facilitated market access for foreign retailers. However, foreign-invested enterprises must still navigate regulations like the Economic Needs Test for new store openings.

Vietnam’s retail landscape is diverse, with a mix of domestic and international players across various formats, including supermarkets, convenience stores, and specialty shops. Traditional markets and street vendors remain significant, particularly in rural areas.

Challenges such as intense competition, regulatory complexities, and supply chain disruptions persist, but the overall outlook for the retail industry remains positive. As consumer preferences evolve and digital channels grow, retailers are increasingly focusing on enhancing customer experiences and integrating omnichannel strategies to stay competitive in this dynamic market.

Vietnam’s retail industry in numbers

Vietnam’s retail industry has demonstrated significant growth, solidifying its role as a key contributor to the national economy. Below is an overview of the industry’s performance, supported by recent statistics.

Vietnam’s retail market

The Vietnam retail market is projected to reach a size of approximately US$276.37 billion in 2024, reflecting the country’s strong economic growth and increasing consumer spending. This impressive figure underscores the expanding middle class, which is driving demand for a variety of retail goods and services. The market is expected to grow significantly, with projections indicating that it could reach US$488.08 billion by 2029. This represents a robust compound annual growth rate of 12.05 percent between 2024 and 2029, according to data from Mordor Intelligence.

Retails sales Vietnam, end-October 2024

Q3OctoberYTD
VNDUS$VNDUS$VNDUS$
General goods3,754,100147.58410,15916.123,754,084148
Food1,312,67851.61145,8015.731,312,67252
Garments191,4347.5320,7870.82191,4338
Utensils, tools, and household equipment405,13315.9343,5111.71405,13116
Cultural and educational items48,9541.925,4780.2248,9542
Vehicles (except cars, including spare parts)181,2767.1320,4880.81181,2757
Accommodation and food services535,53821.0559,8722.35535,53621
Travel, tourism44,0071.734,9000.1944,0072
Services500,13219.6657,9492.28500,13020
Grand total4,833,778190.03532,88120.954,833,757190

Source: Vietnam Retail Sales Tracker

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Key Players in Vietnam’s Retail Market

Vietnam’s retail market is characterised by a diverse array of key players, ranging from domestic companies to prominent international brands. Some of the most influential participants include:

VinCommerce

A subsidiary of the Vingroup conglomerate, VinCommerce operates the VinMart and VinMart+ chains. It is one of the largest retailers in Vietnam, focusing on both hypermarkets and convenience stores, and is known for its extensive network and competitive pricing.

Masan Group

This Vietnamese conglomerate has a strong presence in the retail sector through its ownership of the VinMart chain and the grocery store model under Masan Consumer. Masan is recognized for its strategy of combining retail with fast-moving consumer goods (FMCG).

Central Group

The Thai multinational has made significant investments in Vietnam’s retail market, acquiring the Big C supermarket chain. Central Group has focused on modernising the retail experience and expanding its product offerings.

AEON

The Japanese retail giant operates AEON Mall and AEON Supermarkets in Vietnam, catering to middle-class consumers with a diverse range of products, including groceries, apparel, and household goods. AEON emphasises quality and customer service.

Co.opmart

Operated by the Saigon Union of Trading Cooperatives (Saigon Co.op), Co.opmart is one of the leading supermarket chains in Vietnam, known for its commitment to local products and community engagement.

International Brands

Global retail chains such as Walmart, Carrefour, and 7-Eleven are also expanding their presence in Vietnam, often focusing on urban areas and adapting their business models to local consumer preferences.

E-commerce Players

Companies like Tiki, Shopee, and Lazada have become key players in the rapidly growing online retail sector, offering a wide range of products and services that cater to the changing shopping habits of Vietnamese consumers.

Overall, the Vietnamese retail market is dynamic and competitive, with key players continuously adapting to meet the evolving demands of consumers and capitalise on growth opportunities.

Box 1: Opening a retail store in Vietnam

Shopping at retail stores in Vietnam is becoming increasingly popular as wages rise and the variety of products on offer expands. This presents a range of opportunities for foreign retail store chains.

Opening a retail store in Vietnam for foreign firms, however, is not always easy. Not only are there a number of technical requirements that need to be met, but Vietnam has also developed its own retail store culture, putting its own twist on retail store shopping experiences.

Understanding the nuances of Vietnamese retail store culture and the complexities of business establishment procedures in advance of entering the market can therefore be crucial to the success of a new retail store or chain of retail stores in Vietnam.

For more information see: How to Open a Retail Store in Vietnam

Consumer Behavior in Vietnam’s Retail Market

Consumer behaviour in Vietnam’s retail market is shaped by several distinct trends and characteristics, reflecting the country’s unique cultural, economic, and social context. Key aspects include:

Increasing purchasing power

With a growing middle class and rising disposable incomes, Vietnamese consumers are becoming more willing to spend on quality products and premium brands. This shift is driving demand for both local and international brands across various retail sectors.

Young population

Vietnam has a youthful demographic, with a significant portion of the population under 30. This age group is tech-savvy, heavily influenced by social media, and drawn to trends, making them key consumers in sectors like fashion, cosmetics, and electronics.

Emphasis on health and wellness

There is a growing awareness of health and wellness among Vietnamese consumers. This trend has led to increased demand for organic products, natural ingredients in cosmetics, and healthier food options, influencing purchasing decisions in supermarkets and specialty stores.

Preference for e-commerce

The rapid growth of e-commerce is transforming shopping habits. Consumers increasingly prefer online shopping for convenience and a wider selection of products. Mobile shopping, facilitated by widespread smartphone usage, is particularly popular among younger consumers.

Brand loyalty and trust

Vietnamese consumers tend to exhibit brand loyalty, especially towards brands that they perceive as trustworthy and of high quality. Local brands that focus on authenticity and community engagement are gaining traction, while international brands need to establish credibility to compete effectively.

Bargaining culture

In traditional markets and smaller retail settings, consumers often expect to negotiate prices. This cultural aspect still influences shopping behaviour, although it is less prevalent in modern retail formats like supermarkets and e-commerce.

Social influence

Recommendations from friends, family, and social media influencers play a significant role in shaping consumer preferences and purchasing decisions. Word-of-mouth marketing is particularly effective in this market, as consumers often seek validation from their social circles.

Overall, understanding these consumer behaviour trends is essential for retailers looking to succeed in Vietnam’s dynamic retail environment. Adapting to local preferences and leveraging digital platforms can help businesses effectively engage with Vietnamese consumers.

E-commerce in Vietnam

E-commerce in Vietnam is experiencing rapid growth and transformation, driven by a young, tech-savvy population and increasing internet penetration. A combination of factors contributes to this trend, including widespread smartphone usage, improved payment systems, and enhanced logistics infrastructure.

Major players in Vietnam’s e-commerce landscape include platforms like Shopee, Lazada, and Tiki, which have captured substantial market share through aggressive marketing, extensive product offerings, and user-friendly interfaces. These platforms cater to a diverse range of categories, including fashion, electronics, beauty, and groceries, reflecting the evolving preferences of Vietnamese consumers.

Social commerce is also gaining traction, with businesses leveraging social media platforms like Facebook and Instagram to drive sales and engage customers. Consumers are increasingly influenced by online reviews, social media marketing, and recommendations from friends and influencers. As a result, e-commerce strategies often focus on creating engaging content and personalised shopping experiences.

Despite its growth, the e-commerce sector faces challenges, including competition from traditional retail, issues related to logistics and delivery, and concerns about cybersecurity. However, the overall outlook remains optimistic, as businesses and investors continue to adapt to the dynamic market landscape and capitalise on the opportunities presented by the digital economy in Vietnam.

See also: Online Shopping in Vietnam

What’s next?

The competitive retail environment in Vietnam features a mix of local and international players, including major chains like VinCommerce, Central Group, and AEON, alongside thriving e-commerce platforms such as Tiki and Shopee. 

Traditional retail formats like markets and street vendors continue to coexist with modern outlets, catering to diverse consumer preferences. As the market matures, retailers are focusing on omnichannel strategies and enhanced customer experiences to differentiate themselves in this dynamic sector. Challenges such as intense competition and regulatory complexities remain, but the overall outlook for Vietnam’s retail industry remains positive, presenting substantial opportunities for growth and innovation.

With this in mind, to keep abreast of what’s happening in Vietnam’s retail industry, foreign retail industry professionals should make sure to subscribe to the-shiv.

Last updated December 26, 2024.

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