Vietnam's powdered milk market charms investors: Glico exec

Despite a slowdown in the growth rate of Vietnam’s powdered milk industry in recent years, the market remains substantial, valued at $2 billion, according to Bui Hoang Phu, head of marketing at Ezaki Glico Vietnam, a Japanese company specializing in food and milk production.

Phu made this statement during the launch of Glico ICREO Learning Milk, a nutritional supplement product, in Ho Chi Minh City on Wednesday.

Phu described the Vietnamese market as highly competitive, with as many as 1,605 products currently available. Of these, more than 900 belong to the premium milk segment. However, each brand differentiates itself through its unique formula.

He cited three key reasons for the slow growth and intense competition in the formula milk market including an increasing number of mothers choosing to breastfeed, Vietnam’s birth rate declining, and maternity leave having been extended compared to previous years.

Despite these challenges, Phu emphasized that the market's potential remains enormous due to its sheer size, valued at approximately $2 billion.

He noted Glico currently operates two factories in Southeast Asia, one in Thailand and another in Indonesia, which are sufficient to meet demand for the next 5-10 years. Therefore, there are no immediate plans for new facilities. However, if the market develops at a suitable pace, the company is open to future investments.

By 2024, Glico will complete the construction of a new factory specializing in milk production for both the Japanese and Vietnamese markets, reaffirming the company's commitment to Vietnam.

Currently, this factory supplies milk to Vietnam, while the facilities in Indonesia and Thailand produce baked goods sold in the Vietnamese market.

Glico has been offering its products in Vietnam since 2015. With a line of formula milk products for children over 3 years old, Glico has partnered with Con Cung, Vietnam’s leading mother and baby retail chain, which operates over 700 stores nationwide. The company plans to expand sales to other retail chains and e-commerce platforms.

Additionally, Glico announced a strategic partnership with Con Cung, marking a significant step in broadening its distribution network and bringing Glico ICREO’s trusted products closer to Vietnamese consumers.

Keiichiro Tsuji, country head of Ezaki Glico Vietnam, said that the strategic partnership with Con Cung demonstrates their long-term commitment to supporting Vietnamese families by offering high-quality products that foster the healthy and happy development of young children.