Convenience stores seek ways to differentiate themselves from rivals

In the past, convenience stores differentiated themselves from privately run groceries by position, diverse goods and modern services. Now, they tend to set up large stores integrated with fast food shops to attract youth and office workers.

HCMC residents were reported as queuing up at the first 7-Eleven shop at Saigon Trade Center on June 15, the opening day of the shop.

N.N. Huong, who visited with her teenage daughter, said she was curious about the new brand and she wanted to find out if there was any difference with the Ministop shop located next to her house.

Seven System Vietnam said 7-Eleven offers hundreds of dishes suitable to Vietnamese taste, and provides lunches to office workers with 20 alternatives. Besides the products with private brands, 7-Eleven also provides facilities such as dining area, wifi and card payment services.

After a decade of slow development, convenience stores have been developing strongly in the last three years.

FamilyMart, Ministop and B’s, after changing the joint venture model, have been stepping up the expansion of the chains.

Each of the brands has had 40-50 new shops set up every year. In the last three years, the network of 24/24 convenience stores has grown threefold and expanded to other provinces and cities besides Hanoi and HCMC.

Analysts said though the high retail premises rent remains the biggest obstacle for the development of convenience stores (which accounts for 40 percent of operation costs), convenience stores have overcome a difficult period to form large-scale chains.

Most convenience store chains are part of large corporations such as Aeon, Central Group, Saigon Co.op, Vingroup and SATRA.

Aeon, for example, now owns many retail chains in Vietnam, including Ministop, which is open 24/24 hours, located in central districts; Aeon Fivimart, known as food shops; Aeon Citimart B&B, located in apartment blocks; and Daiso, the single-price chain, which all connect other models, from supermarkets, hypermarkets and shopping malls to other potential segments of the retail market.

Zakkamart, a 100 percent Vietnamese owned chain, established three years ago, opens two new shops every month on average. The difference between Zakkamart and other convenience stores is that the chain sells fresh food, vegetables and fruits and frozen products.

Nguyen Van Khoa, deputy general director of Satra, said Satra provides daily meals, and does not only focus on FMCG (fast-moving consumer goods).