Retail businesses find ways to overcome difficulties

VCN- The heavy impact of the Covid-19 epidemic has dragged down retail sales of goods in Ho Chi Minh City tothe lowest level ever. In the face of this situation, many retail businesses were quick to change sales methods to improve sales in response to Covid-19.
retail businesses find ways to overcome difficulties Businesses looking to domestic market amid pandemic
retail businesses find ways to overcome difficulties Businesses concerned as COVID-19 looms large
retail businesses find ways to overcome difficulties
Home delivery service has helped Saigon Co.op supermarkets improve sales during the social distancing period. Photo: Internet

Revenue plummeted

According to areport byHo Chi Minh City Statistical Office, in April, the City implemented the Government's Directive 16 / CT-TTg on social isolation to prevent and control the Covid-19 epidemic.Revenue from trade and services plummeted due to the impact of 22 days of isolation, social activities were interrupted andtravelrestricted. The consumption structure of people has changed, focusing on essential commodities such as food and foodstuffs. This makes most retailers and trading of non-essential items in the past month seeno sales like fashion items andsouvenirs.

Notably, according to the Bureau of Statistics, although there are public holidays in the year such as Hung Vuong's death anniversary, April 30 and May 1, the revenue from trade and services of the city is still not much,with no significant change as in previous years. Total retail sales of goods and services in April wasonly VND68,457 billion, down 22.8% over the previous month and down 34.2% over the same period last year. In particular, the most serious damage is becausethe tourism industry did not generate revenue in the month due to the impact of Covid-19. Other industries were also seriously affected by the disease. Retail sales in April only reached VND56,039 billion, down 7.3% from the previous month and down 4.8% over the same period last year. Most shopping malls have very few visitors. According to retail real estate management companies, the number of visitors shopping started to decrease from February and by the end of March, it had decreased by approximately 80% at the point of sale. Notably, through April almost froze because most of the time this month must implement social spacing to prevent the spread of the disease.

According to experts, the turnover of various categories decreased during the period of Covid-19. The industries that had to close as education had almost no revenue while fashion industries and accessories reduced 80-90%.

Not only are the essential aviation industries affected, according to Ho Chi Minh City Statistical Office, accommodation and catering services of the city in April decreased by 47.7% over the previous month and by 85.8% compared to the same period in 2019, only reaching VND1,306 billion. In particular, the catering industry decreased by 46.7% over the previous month and by 85.5% over the same period last year. The reason is that although the units have offered methods such as home delivery or take away to limit revenue loss, but the psychology of infection, people increase eating at home and avoid outside contact. In addition, accommodation revenue in April decreased by 57% from the previous month and by 88.2% from the same period last year. Currently, the number of tourists is mainly hourly, or for stays for medical treatment, international guests come and cannot return. Other consumer services were estimated at VND11,112 billion, down 56.4% compared to the previous month and down 66.7% over the same period last year. For the first four months, total retail sales of goods and services in Ho Chi Minh City reached about VND387,568 billion, down 11.2% compared to the same period last year.

Proactively adapt

However, a recent highlight of the retail market has been the development of e-commerce transactions and cashless payments. Commercial centers, supermarkets and catering services deploy a series of promotions to stimulate buying and selling through channels such as phones, websites and apps tosupport the delivery policy. The change in sales methods helps business units to improve sales in the gloomy market situation due to the pandemic. According to CBRE Vietnam, among the big names in the field of e-commerce, Tiki grew at a fast pace and reached a record of 4,000 orders per minute. SpeedL and Saigon Co.op increased exponentially in online sales channel.

According to the latest statistics of Saigon Co.op, online and telephone ordering services have contributed to the sales of the supermarket system on the 30/4 holiday by more than 30% compared to the time before implementing social isolation measures. Similarly, the Big C retail chain has also increased sales by phoneto help customers, which also brought high growth.

According to Dr. Dinh Ba Tien, a lecturer at the University of Nature - Vietnam National University, Ho Chi Minh City, the epidemic changes rapidly, leading to the retail business of services being seriously affected by temporary shutdowns of nonessential services. However, many retail businesses have been quick to switch from offline to online sales. This is thanks to the relatively recent development of e-commerce platforms due to the investment of startups. Freight forwarding has been heavily invested in the past few years, so quick delivery systems have been highly effective in recent years, especially during the social distancing period. As noted, transactions in the retail market have decreased by 50-80% depending on the industry. Meanwhile online transactions have increased by 25-30%.

These are very quick moves to adapt to the market from the retailer. According to experts, although the online retail marketgrowth over the past few years (an average increase of 39% in five years) is higher than the increase of the traditional retail market (increasing averagely 10% over five years), it still accounts for less than 4% of total retail sales in Vietnam. Therefore, through the difficulties of this epidemic, retailers need to change and be more flexible to cope with the situation of rapidly changing consumer habits.

By By Nguyen Hue/Bui Diep

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