Thai retail giant to invest $1.45B in Vietnam
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Thailand’s Central Retail Corporation has announced it will double the number of its Vietnam stores with its largest ever local investment of 50 billion baht (US$1.45 billion).
The chain’s number of stores will jump to over 600 in 57 of 63 cities and provinces with the new investment over the next five years.
Central Retail CEO Yol Phokasub said the Vietnamese market has immense potential for continued economic growth.
He predicted the country would post GDP growth of 6.7% this year and 7.2% next year, compared with Thailand’s average of 3.5% a year. “This will make Vietnam the fastest-growing market in Southeast Asia,” he said.
Central Retail Vietnam has reported that in this year alone it will invest 6 billion of the baht in developing its businesses nationwide with a focus on food to reinforce its leading position in the nation’s hypermarket segment.
The Thai company also plans to renovate 10-12 Nguyen Kim chain electronics supermarkets while opening 3-5 new supermarkets and Go! Hypermarkets.
Central Retail Vietnam currently operates more than 340 stores. Its revenue surged from 300 million baht ($8.7 million) in 2014 to 38.6 billion baht ($1.12 billion) in 2021.
A Central Retail manager said that in 2022 despite the impact of the economic recession, rising goods prices, and a consumer cut in spending, its sales grew in double digits thanks to its “always low price” policy.
Japan’s Aeon plans to operate 100 supermarkets across Vietnam by 2025. South Korean retail giant Lotte has also said it will open more supermarkets in Vietnam.
After gradually withdrawing from China, Lotte now regards Vietnam as its third most important market after South Korea and Japan.
Questions & Answers
Q.What is the total value of Central Retail's investment in Vietnam over the next five years?
What is the total value of Central Retail's investment in Vietnam over the next five years?
Central Retail plans to invest 50 billion baht, which is equivalent to US$1.45 billion. This represents their largest local investment to date in Vietnam.
Q.How many stores will Central Retail operate in Vietnam after this expansion, and where will they be located?
How many stores will Central Retail operate in Vietnam after this expansion, and where will they be located?
The company expects to have over 600 stores across 57 of Vietnam's 63 cities and provinces. This expansion will significantly increase their current store count.
Q.Which specific retail segments will Central Retail be focusing on with this new investment?
Which specific retail segments will Central Retail be focusing on with this new investment?
The company will focus on developing its food businesses to strengthen its position in the hypermarket segment. They also plan to renovate electronics supermarkets and open new supermarkets and Go! Hypermarkets.
Q.What factors led Central Retail to achieve double-digit sales growth in 2022 despite economic challenges?
What factors led Central Retail to achieve double-digit sales growth in 2022 despite economic challenges?
Despite the economic recession, rising goods prices, and reduced consumer spending, Central Retail's sales grew due to its 'always low price' policy. This strategy helped maintain performance.