VietNamNet Bridge – Splendid high end supermarkets with fandangle windows, which were once the shopping destinations only for the rich, have shifted to serve popular customers as well.




Shopping malls have been mushrooming recently, when Vietnam has been witnessing a serious economic recession which keeps Vietnamese away from luxurious shopping centers. This explains why the luxurious centers have become popularized.

Some days ago, a big foreign distribution chain opened one more shop in Ha Dong district in Hanoi. Unlike the other two retail points of the chain, the third one focuses on serving individual customers instead of selling wholesale as it planned before, when setting foot in Vietnam.

Another big guy in the retail industry has been following a plan to reach out to small provinces and cities, like Nam Dinh and Vinh Phuc, instead of focusing on big markets. Especially, in order to attract more customers, the retailer offers free buses to carry customers from the suburb districts of Nam Dinh and neighboring provinces to the shopping mall.

Most recently, a luxurious shopping mall located at a high end apartment block in Cau Giay district in Hanoi, has also decided to attract popular customers instead of focusing on high income earners. The investor, a foreign one, said that students and local residents would be the main source of customers of the supermarket.

Commenting about the moves, analysts say the high end shopping malls have been following a wise business strategy which allows them to survive the current difficulties.

The retailers have learned the lesson from Grand Plaza and Hang Da Galleries which have been poorly patronized since the day they opened. Grand Plaza shut down in late December 2012 for an upgrading project, while Hang Da Galleries have the modest occupancy ratio of 20 percent.

A lot of shopping malls which initially targeted high income customers, have to change their mind after seeing a series of big-scaled retail chains shut down. It seemed that they made a mistake when positioning themselves as high end brands. They realized that they chose the wrong targeted clients, because the number of high income earners affordable their expensive products remains modest, while the number of suppliers has increased rapidly with the mushrooming of high end supermarkets.

Meanwhile, the list of high end shopping malls to be operational in the time to come has been extended, which means stiffer competition among retailers in the near future.

In thoughts of Vietnamese people, shopping malls mean the places where luxurious and expensive products are sold. Therefore, traditional markets still play a very important role in the lives of the majority of Vietnamese.

A senior executive of a real estate consultancy also said he can see a growing tendency of popularizing supermarkets and shopping malls due to the economic downturn and the policy of people to cut down expenses.

Vietnam was once the most attractive retail market in the globe in 2008, but it has been continuously falling grades since 2009, while it has just been weeded out of the list of top 30.

In 2012, Vietnam was put on the 32nd position in A. T. Kearney’s GRDI, the global retail index. This was for the fourth time Vietnam fell grades in the ranking.

However, despite the fall in the grades, retailers still have been heading for the Vietnamese market. On January 17, E-mart, one of the South Korean leading retailers, announced the plan to develop a supermarket chain in Vietnam with 17 supermarkets to be opened by 2017.

Compiled by C. V