Vietnam skincare industry poised for rapid growth

With its large young population and rising disposable income, Vietnam has become an attractive market for manufacturers and distributors of skincare products, industry insiders say.

An Inkwood Research report evaluates Vietnam's skincare industry at over $1.3 billion by 2028, a significant 6.47% compounded annual growth rate from 2022 onwards.

The report attributes this growth to rising demand for sensitive skin products and heightened focus on personal health among consumers.

Both local and international enterprises are looking to tap this growth with strategically planned cooperative efforts and long-term initiatives.

LG Vina has entered into a strategic partnership with DKSH, a leading market expansion services provider, to enhance the market presence of its high-end derma-cosmetic line, Physiogel, which was acquired by the LG Household and Healthcare Group in 2020.

Kim Kyung Hyo, director of home care and daily beauty department at LG Vina Group, stressed the high potential of Vietnam’s skincare market, saying people in the country had become more conscious of their looks and embraced new beauty trends quickly.

"Vietnam has a large population with a high proportion of young people compared to other countries in the region, and skincare products have witnessed significant adoption among these consumers," he said.

"We believe DKSH is the ideal partner to expand our market reach with Physiogel. With its extensive network of local partners and profound market insights, DKSH is poised to expedite our growth in the Vietnamese market.

“Given Physiogel's status as a beloved cosmetic brand in Korea, we are confident that our collaboration with DKSH will elevate our brand to similar acclaim in Vietnam."

Hyo said he expected Physiogel products’ sales to reach VND300 billion ($11.7 million) in the next five years as a result of the partnership with DKSH.

An Khang, one of the top three pharmacy chains in Vietnam, has also teamed up with DKSH for providing Vietnamese consumers with greater access to cosmetic brands.

Phan Ngoc Dinh Lang, product director at An Khang, said amidst the growing proactive healthcare trend in the country, her company had seen increased interest in consumer health product categories.

DKSH supplies An Khang with a diverse range of products including nutrition, derma-cosmetics, consumer health and consumer goods.

Skincare products have emerged as a promising segment in An Khang's product portfolio, Lang said.

"DKSH serves as a strategic partner for various international healthcare brands. This collaboration empowers us to access high-quality products from these brands in a consistent and reliable manner," she added.

Lang said statistics from five major e-commerce platforms in Vietnam showed that beauty care products were among the highest revenue earners with combined sales exceeding VND37.5 trillion ($1.47 billion) last year.

Skincare products alone fetched VND10 trillion ($391.8 million), she said, adding that the figures were expected to rise steadily in the coming years.