Troika-like position drives the retail market

VietNamNet Bridge – Having 130 operational shopping malls, 700 supermarkets and over 1,000 convenience stores, the Vietnamese retail market has been dominated by the three biggest names Co-op Mart, Big C and Metro. The “boundary” between wholesale and retail has been blurred.

Co-op Mart pairs off with Big C

Co-op Mart pairs off with Big C

The confrontation between Big C and Co-op Mart is believed to be the stiffest competition among the retailers. While Big C states it “offers low prices of goods for every family,” Co-op Mart says it is the “friend of every family.”

The thousands of product items available at Big C are believed to have the sale prices lower by 1-3 percent than the prices at other supermarkets. In order to have the best prices, Big C usually runs sale promotion programs, considering this one of the most important business solutions.

Co-op does not highlight the low prices of goods as its major advantage in the competition to expand the market share, but it has also been trying to cooperate with the manufacturers in order to have the most reasonable prices, especially for fresh food and essential goods.

Branding experts have commented that Co-op Mart too well understands Vietnamese consumers, while Big C has deep knowledge about the Vietnamese market and the consumption habit.

Both Big C and Co-op Mart have been grabbing every possible opportunity to promote Vietnamese goods and increase the presence of Vietnamese goods at their distribution chains. Vietnamese products reportedly account for 90-95 percent of the total product items displayed there.

According to Kantar Worldpanet, a market survey firm, Big C has been leading the market in building up the image of the best-price distributor who usually offers attractive sale promotion programs.

The confrontation of the two brands began when Big C set foot in the Vietnamese market in 1998. After buying Cora Dong Nai supermarket from a French fellow countryman, Big C followed the strategies to become a retailer offering high quality products at the prices equal or higher than that of Co-op Mart.

However, in 2005, Big C began changing its business strategies, since it could not optimize the profits and expenses, though the same business strategies brought successes to the distributors in other countries.

Since then, Big C has been following the “low price” business strategy with which it has been succeeding over the last many years.

Co-opXtraplus has encroached on Metro’s playing field

Metro had been the only player in the wholesale market for a long time until the day Co-op Mart chain jumped on the bandwagon.

Co-op Mart, which has been succeeding with its retail model, has decided to enter the wholesale market by launching the two hypermarket brands Co.opXtra and Co.opXtraplus.

In mid-May 2013, Co.opXtraplus hypermarkets, which has the average area 4-5 times higher than Co-op Mart and displays the amount of goods 2-3 times higher, made debut in HCM City.

In order to exploit the new market segment well, Saigon Co-op Mart decided to cooperate with NTUC Fair Price, the leading cooperative in Singapore, now holding 60 percent of the Singaporean retail market, established by the former Singaporean Prime Minister Lee Kuan Yew.

Analysts have noted that Co.opXtraPlus has the operation model similar to that of the German distributor Metro Cash & Carry. It not only target individual and household clients, but also enterprises, schools, restaurants and hotels.

DNSG

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