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Purchasing power down
Lan Anh, an officer of a mobile phone retail shop in HCM City said that the sales have decreased by 15-20 percent so far this year. “In the context of high inflation, people have to think carefully before deciding to buy mobile phones,” she said.
“Our shop is still full of people, but there are more visitors and buyers,” she added.
Dinh Anh Huan, Deputy General Director of The Gioi Di Dong, the mobile phone retail chain, has confirmed that the sales at The Gioi Di Dong have dropped by 30 percent in comparison with the same period of the last year. Therefore, the volume of mobile phones imported by the retailer has also decreased by 30 percent.
“People tend to fasten their belt, and they prioritize spending money on essential goods rather on mobile phones,” Huan said.
Huynh Nhan Quy, Market Research Director of Vien Thong A, also a distribution chain, said that he still can see the growth rate of the mobile phone market of 20 percent in comparison with the same period of the last year. However, he admitted that like other business branches, the mobile phone market’s growth rate is lower than expected.
The low demand has prompted mobile phone manufacturers to slash the sale prices. The first sharp price fall was seen in February, when Dell, HTC, Samsung and Nokia lowered the sale prices of a series of products by 200,000-1.5 million dong.
The second price decrease occurred in May, when HTC and Nokia caused a shock to consumers with offered sharp price decreases. HTC, for example, slashed the price by 4 million dong for one kind of product: the smart phone HD7 run on Winphone 7 now has the price of 14,990,000 dong to 10,990,000 dong.
The problem is that distributors, who expected the high growth rate of the mobile market, imported mobile phones in big quantities, while the purchasing power was lower than expected.
According to the Ministry of Industry and Trade, about five million of mobile phones were imported in the first quarter of 2011, an increase of 16 percent over the same period of 2010. The imports increased by 2.5 million mobile phones during that time to serve the Tet shopping season.
Huan admitted that The Gioi Di Dong imported products in big quantities earlier this year, hoping that the sales would go well on Tet season. However, as the demand has been low, the retail chain could only clear the stocks in late April.
“We just resumed importing products in early May,” Huan said.
Mekong Delta, the east of the southern region, the north and the south of the central region are the fastest growing markets. Meanwhile, low cost products are the best sellers.
Difficulties existing
Mobile phone distributors not only fear the low demand, but also the new regulations on import management, which are clearly stricter.
Until May 2011, mobile phones have been carried to Vietnam by air. However, from June 1, mobile phones can only go through three main seaports. Importers will have to present many additional kinds of documents.
Huan said that with the new regulations, distributors will have to meet many difficulties, while they have to spend more time and money on procedures. “Most of mobile phones are sourced from China. If the products are carried by ships, they will only arrive in Vietnam after some days, while it takes only several hours to bring the products to Vietnam by air,” Huan said.
“It is estimated that the required procedures will take enterprises one month, while the additional expenses would be equal to two percent of the mobile phone products,” Huan said.
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