Retail businesses "transform" during the pandemic season

VCN - Facing difficulties and challenges caused by the Covid-19 pandemic, many businesses in the retail sector have actively innovated and improved the quality of goods to meet the needs and tastes of consumers.
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Overcoming difficulties

In the difficult context of the Covid-19 pandemic, import and export activities were affected, so many Vietnamese enterprises with reputable brands changed their direction to exploit both the domestic and export markets. The motto given by businesses is to firmly establish the domestic market, creating a basis for expanding to export markets.

According to Ms. Ly Kim Chi, President of the Food Association of Ho Chi Minh City, since the beginning of the year, many manufacturing enterprises in the field of food processing, after shifting to focus on domestic market share, have maintained and developed stably.

For example, Saigon Food Joint Stock Company still maintains production capacity of processed food products such as seafood, frozen seafood, fresh porridge,reaching 30 tons per day. In the first six months of this year, the company's revenue increased 20% year-on-year, in which revenue increased sharply in the peak months.

Vietnam Food Industry Joint Stock Company (Vifon) is stronger when temporarily cutting export orders to prioritize production for the domestic market, though export orders increase by 300%. Particularly, Vissan Company, which focuses mainly on the domestic market, has had spectacular growth in recent times. The company's consumption of canned foods increased by nearly 100%, sterilized sausages increased by 15% -20%, frozen goods increased by over 20%.

Meanwhile, other retailers such as Vinmart and Lotte Mart are implementing the strategy of localizing their product portfolio to suit the preferences of consumers and building brand positioning and applying technology to real-time inventory management and efficient supply chain management. In addition, the sales trends that have been deployed since social distancing, such as online sales through websites, mobile banking applications of banks and ordering by phone. These will continue to be used by sellers in the future to connect with consumers.

With the above initiative of retailers, together with the support of the policies that the Government, ministries, branches and localities have made, many people believe that the year-end retail sector will be brighter after a gloomy time amid the pandemic.

Investing in online markets

The developments of the Covid-19 pandemic have changed consumption habits and behaviors, forcing businesses to speed up their investment and operate online commerce. From the above signals, many retailers said that they are more flexible in selling to attract consumers. Accordingly, retailers, in addition to rotating promotions, discounts, gifts or accumulating points for members, also promote the small store model, flexibly selling from online to offline to deliver to consumers.

Ms. Le Thi Thanh Lam, Deputy General Director of Saigon Food Joint Stock Company, said that when the Covid-19 pandemic broke out, consumers were confused and had a psychology of hoarding, so online sales grew well.

In the current reappearance, consumers have experienced and have a firmer mentality. However, online sales are still growing because users are familiar with online purchases on Saigon Food's website and e-commerce sites that Saigon Food uses. Accordingly, the company always offers attractive programs in accordance with customers' needs.

Lotte Mart Vietnam's speedl.vn website started to grow from November 2018 after a year of development, but it was not until the first outbreak (March in Ho Chi Minh City, Hanoi) and the second (July in Da Nang).

A representative of Lotte Mart Vietnam said that the trend of customers increasing online shopping to limit direct contact, so many groups of products with strong consumption, including fresh products, milk, noodles, confectionery and tissue paper.The company has to double its staff for the online segment, but sometimes it still cannot meet the needs of customers.

AEON Vietnam also quickly launched aservice of shopping by phone to help customers who are not familiar with shopping technology on apps and websites. These solutions are considered a breakthrough to help sales of traditional retailers become more stable because the online channel has grown 3-4 times in the past.

It can be seen that, under the influence of the pandemic, the traditional distribution channel has been transformed, creating a new, modern business trend, more suitable for the market. From this success, retailers affirmed that this will be a trend for them to continue promoting in the future, even after the pandemic is over in order to create diversity in the retail supply chain for consumers.

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However, according to experts, many businesses are still quite slow to grasp the trend and invest in developing this distribution channel; they still depend on available distribution channels. Some businesses have also pushed their products to "online market” but have been ineffective and the revenue is still low. Expanding the domestic market share is difficult, but it is much more difficult to keep a long-term market share for domestic enterprises. This requires businesses to be more proactive in improving production capacity and product quality to meet increasingly high requirements of consumers.

By Thu Diu/Bui Diep

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