International retail giants intensify focus on Vietnamese products

Multinational retail giants Walmart, Central Retail, Aeon and Lulu, operators of mega grocery networks and outlets, are prioritizing Vietnamese items as they expand their supply chain.

This fact was highlighted Friday at a discussion organized in Ho Chi Minh City by the Ministry of Industry and Trade to prepare for an upcoming event themed "Connecting the International supply Chain of Goods" - Vietnam International Sourcing 2024.

Nguyen Duc Trong, head of Walmart's new supplier development department in Vietnam, said the country was increasingly considered a hub in the supply chain of goods for the retailer, which includes 10,500 stores worldwide.

"To date, Vietnam has exported $7 billion to the Walmart grocery system worldwide and is a popular destination amid the shift of multinational corporations' supply chains," Trong said. He predicted that this figure will continue to rise substantially in the coming years.

Apart from Walmart, large distribution corporations, including Aeon, Uniqlo (Japan), Decathlon (France), and Central Group (Thailand), have launched ambitious and detailed plans to expand the scale of their distribution chains in the Vietnamese market in the near future.

According to Paul Le, vice president of Central Retail Group, up to 95% of Vietnamese items currently appear in all of the brand's outlets. "Vietnam offers numerous high-quality products that are popular in other nations like coconuts from Ben Tre province, lychee from Bac Giang province, mango from Cao Lanh town in Dong Thap province, and coffee," he added.

Yuichiro Shiotani, director of Aeon Topvalu Vietnam, said Aeon was purchasing products from 48 countries around the world, and Vietnam was one of the countries given the highest priority in the process of choosing the best potential supplier for its stores.

Observing that every market has a distinct "taste" in product usage, Paul Le promised that Central Retail Group will help Vietnamese companies modify their designs and packaging in the near future to better access the U.S and European markets.

Trong from Walmart commented: "Walmart purchases goods from 500 Vietnamese companies, the majority of which are foreign-invested. Vietnamese companies still struggle to collaborate with us directly. They mainly work via middlemen."

Ta Hoang Linh, director of the European-AAmerican Market Department under the Ministry of Industry and Trade, said that the ability of Vietnamese enterprises to participate deeply in the supply and distribution chain was currently limited. It is still difficult for them to meet all criteria, standards, conditions, and delivery times.

"In addition, distribution channels often sign contracts with very large quantities, and product prices must be very competitive. Therefore, when participating in foreign distribution chains, Vietnamese businesses need to grasp and update new trends and changes in markets," he noted.

Linh reaffirmed that in order to support enterprises in selling goods in both domestic and export markets, the trade ministry will continue to coordinate its efforts with other stakeholders.