The Vietnamese market holds strong potential in Southeast Asia, and multinational consumer goods giant Unilever is determined to tap into the market, Unilever CEO Alan Jope said.
"While many of our units elsewhere are still struggling to return to business, operations in Vietnam are going very well," he said during a recent working trip to Vietnam.
The giant announced its full-year results for 2022 on February 9, saying that its “underlying sales growth accelerated to 9%, driven by all business groups, with price growth of 11.3% and volumes declining 2.1%.”
Its home care business contributed 21% to the group's turnover, of which fabric cleaning grew high double-digit while holding volumes almost flat. This was driven by very strong performances in South Asia, Brazil, Turkey, and Vietnam, with modest sales growth in Europe and China, a company report said.
Entering Vietnam in 1995, Unilever quickly became a giant in the consumer goods industry, providing a series of brands like Lifebuoy soap, Omo detergent, and Sunsilk shampoo. It is estimated about 35 million Unilever products are currently used in Vietnam every day.
During his visit, Jope said more than 90% of Unilever products sold in the Vietnamese market are made in the country at the global multinational’s two factories located in the northern province of Bac Ninh and Ho Chi Minh City’s Cu Chi district. Additionally, Unilever operates five distribution centers in Bac Ninh, Danang, Binh Duong.
"We've had strong growth here," Jope said, but did not disclose details. For the country’s 2023 GDP growth, he said 6-7% was feasible, and even 8% was likely.
"Our global strategy holds big ambitions for the Vietnamese market," he said.
Jope detailed that Unilever Vietnam would double its current size over the next 5-10 years, instead of spending 27 years like the previous period. The three factors for the plan are strong brands, good business operations, and contributions to the community.
The Unilever CEO said his group will continue to invest in Vietnam.
"Currently, we do not have plans to build a new factory, but certainly the two operational plants will need further investment for production expansion."
The CEO said his group does not see Vietnam as a low-cost production base for exports as Unilever products made in Vietnam are aimed at the domestic market. Jope added investment in Vietnam is also for human resources development and branding.
Vietnam’s General Department of Taxation in October 2022 publicized the top 1,000 corporate taxpayers in the country. Honda, C.P., Samsung, Heineken, Unilever, Toyota, and Suntory Pepsico were the top foreign-invested taxpayers on the list, which did not quantify the actual corporate income tax (CIT) payments made in 2021.