VietNamNet Bridge - Big changes can be seen in the range of products displayed at supermarkets after the supermarkets fall into new hands.

 

“We have stopped making products for Metro Cash & Carry since January 1, 2016,” said Le Thi Thanh Lam, deputy general director of Sai Gon Food.

When asked about the reason behind the decision, Lam said the prices offered by the supermarket were no longer reasonable in the new conditions, while sales had dropped dramatically by 50 percent. 

However, there is another important reason that ‘it is still unclear what the supermarket will be like after it is transferred to the new owner’.

Metro has announced that the ownership transfer process to the new owner – Thai BJC - has finished. 

In fact, products made for Metro for its private brand, as well as products under Sai Gon Food brand, have also seen sharp decreases.

The deputy director of a company providing specialty rice said he continued the supply contract after Family Mart was transferred to the Thai owner and changed its name into B’s mart. However, he has finally decided to stop cooperating with the new investor because he is not satisfied about the new payment method and the number of orders.

Big changes can be seen in the range of products displayed at supermarkets after the supermarkets fall into new hands.

Nguyen Bui Chau Hoang, manager of the food and non-food division of AEON Citimart, noted that after the Japanese retailer AEON joined Citimart's board of management, there have been big changes with the structure of food products displayed.

Hoang said about 50 percent of old suppliers have gone, while many new suppliers have come. Some of the new suppliers belong to AEON’s supply chain and they have been chosen by the retailer.

“We set up requirements and we will cooperate with the suppliers who can satisfy the requirements,” she explained.

The representative of a conglomerate which has taken over two retail chains also said that the conglomerate has restructured the chains and only retained the best. 

He said the suppliers who cannot satisfy the requirements on goods quality, production process and delivery times have been replaced.

Analysts noted that the opportunities for small manufacturers seem to get smaller as retailers tend to join more deeply into the production process. Most retail chains have products bearing their private brands, from fresh food to processed food and fast moving consumer goods.

Vingroup, for example, makes Eco vegetables and distributes the vegetables at its Vinmart and Vinmart+ shops, competing directly with vegetable suppliers.

Analysts also noted that More Thai products have been available at B’s Mart after the retail chain fell into Thai hands. BJC, the new owner of Metro, has also stated it will bring more Thai products to Vietnam.


TBKTSG