Illustrative image (Source: VNA) HCM City (VNS/VNA) - Vietnamese customers’rapidly changing needs and expectations and lower spending on fast movingconsumer goods (FMCG) are the biggest challenges to the sector, according to anew report released by consumer and retail research company Kantar Worldpanel.
The report said consumers are no longer focusingjust on basic needs but moving to new aspirations, and so have a tendency tocut their spending on FMCG to spend on non-FMCG items such as real estate,equipment, vehicles, entertainment and technology.
Last year an average of 16 new FMCG productsentered the Vietnamese market daily with one third of them being packaged foods.
But people are getting busier and go shopping forFMCG less often and buy fewer categories, which leads to a lower volume of in-homeconsumption.
The average frequency of trips per year hasdecreased sharply in both urban and rural areas.
Last year urban shoppers made an average of 152shopping trips, down from 159 trips in 2015.
In rural areas, the figure was 132, down seventrips.
A report released by Nielsen Vietnam, a globalmeasurement and data analytics company, in May said FMCG sales throughtraditional channels experienced a 1.5 percent drop in sales in the firstquarter of this year.
The slowdown was seen across six super FMCGcategories -- beverages including beer, milk base, food, household careproducts, personal care products, and cigarettes.
Only beverage and cigarette sales showed positivegrowth, albeit marginal growth.
The others all suffered a decline.
The slowdown in sales at traditional channels canalso be explained by tougher competition from modern trade channels.
The Kantar report also found that people areswitching from supermarkets, which is the main traditional trade channel, toonline and mini-stores and convenient stores due to speed and convenience.
Online, from a very small base, is growingexponentially, especially in the health and beauty sector, by continuouslyadding new shoppers, it said.
According to the company, Vietnam’s retail landscapepromises a lot more changes in the near future. -VNS/VNA
The report said consumers are no longer focusingjust on basic needs but moving to new aspirations, and so have a tendency tocut their spending on FMCG to spend on non-FMCG items such as real estate,equipment, vehicles, entertainment and technology.
Last year an average of 16 new FMCG productsentered the Vietnamese market daily with one third of them being packaged foods.
But people are getting busier and go shopping forFMCG less often and buy fewer categories, which leads to a lower volume of in-homeconsumption.
The average frequency of trips per year hasdecreased sharply in both urban and rural areas.
Last year urban shoppers made an average of 152shopping trips, down from 159 trips in 2015.
In rural areas, the figure was 132, down seventrips.
A report released by Nielsen Vietnam, a globalmeasurement and data analytics company, in May said FMCG sales throughtraditional channels experienced a 1.5 percent drop in sales in the firstquarter of this year.
The slowdown was seen across six super FMCGcategories -- beverages including beer, milk base, food, household careproducts, personal care products, and cigarettes.
Only beverage and cigarette sales showed positivegrowth, albeit marginal growth.
The others all suffered a decline.
The slowdown in sales at traditional channels canalso be explained by tougher competition from modern trade channels.
The Kantar report also found that people areswitching from supermarkets, which is the main traditional trade channel, toonline and mini-stores and convenient stores due to speed and convenience.
Online, from a very small base, is growingexponentially, especially in the health and beauty sector, by continuouslyadding new shoppers, it said.
According to the company, Vietnam’s retail landscapepromises a lot more changes in the near future. -VNS/VNA
VNA
