Masan Group to shutter hundreds of Vinmart stores
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Vietnam consumer-goods company Masan Group says it plans to shut down hundreds of VinMart and VinMart+ stores it purchased from VinGroup last year.
The company said they will open 10-30 new Vinmart supermarkets and close 100-300 Vinmart+ stores this year to focus on improving profitability of existing locations instead of following the program of massive expansion followed by the previous owner.
Masan will shift its focus to supermarkets of less than 1500 sqm that bring the best revenue, cut inefficient supermarkets in Hanoi, Ho Chi Minh City, Nha Trang and Can Tho and expand into tier 2 cities and within Vincom shopping centres.
The VinMart+ chain operated 2888 stores last year and had targeted opening 300 to 500 new stores while closing 150-300 less efficient stores.
Post merger, Masan aims to increase VinCommerce’s revenue to more than VND42 trillion, a year-on-year increase of 64 per cent. Masan has spent an estimated VND5.4 trillion (US$233 million) to buy a controlling stake in VinCommerce, which runs VinMart and VinMart+ stores in 50 provinces and cities and 14 VinEco hi-tech farms.
Meanwhile, VinGroup closed its VinPro chain of appliance stores on December 31 and has since announced the closure of a network of smartphone stores trading under the Vien Thong A brand. And this week, VinGroup said it was dropping plans to launch an airline as well as it seeks to focus its business on industrial categories – including cars (VinFast), and phones and flatscreen TVs (VinSmart) – along with its Vincom shopping centres and VinPearl resorts.
Questions & Answers
Q.What is Masan Group's primary objective behind closing so many stores?
What is Masan Group's primary objective behind closing so many stores?
Masan Group aims to improve the profitability of existing locations rather than pursuing the massive expansion strategy used by the previous owner. They will focus on supermarkets under 1500 sqm that generate the best revenue.
Q.Which specific types of stores are Masan Group planning to close and open?
Which specific types of stores are Masan Group planning to close and open?
Masan Group plans to open 10-30 new VinMart supermarkets. Concurrently, they intend to close 100-300 VinMart+ stores, especially inefficient ones in major cities.
Q.What was the previous target for VinMart+ store expansion before Masan Group's acquisition?
What was the previous target for VinMart+ store expansion before Masan Group's acquisition?
Before the merger, the VinMart+ chain, which operated 2888 stores last year, had targeted opening 300 to 500 new stores. They also planned to close 150-300 less efficient stores.
Q.How much revenue does Masan Group aim for VinCommerce to achieve after the merger?
How much revenue does Masan Group aim for VinCommerce to achieve after the merger?
Post-merger, Masan Group aims to increase VinCommerce’s revenue to more than VND42 trillion. This represents a substantial year-on-year increase of 64 per cent.
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