Retail is said to be gradually recovering and becoming active again after the Covid-19 pandemic. How do you rate that?

Retail is considered to be one of the industries hardest hit by the pandemic. Since the outbreak in late April 2021, many companies in the Vietnamese retail market have had to close or downsize their business models.

But from April 2022 to now, the retail industry has regained its post-pandemic recovery. An August 2022 Vietnam Report report shows that 53.8% of retailers have now achieved business performance at or above pre-pandemic levels, which is a really good number.

The latest data released by the General Statistics Office shows that total retail sales of consumer goods and services in November 2022 increased by 2.6% month-on-month and by 17.5% year-on-year. Grocery sales increased by 8-10%, travel service by 300% and clothing service by 20-22%.

In your opinion, where did the ‘leverage’ retail recovery come from over the past period?

Retail achieved this result thanks to the leverage of overall economic growth, the recovery in all sectors has returned. Consumer demand is also recovering strongly. In addition, the policy of reducing VAT from 10% to 8% and the stimulus plan approved by the National Assembly had a positive impact on Vietnam’s retail trade.

In addition, retail has a lot to do with people’s lives and incomes. As people’s incomes increase, so does retail sales.

However, there are still some concerns about the challenges ahead as the industry contends with inflation and high commodity prices… What do you think?

Consumer income drives their spending. If inflation keeps rising, they will cut spending on non-essential goods (like electronics, housing, luxury items, etc.), while essential goods will be less affected. Therefore, retail companies need to understand each situation and market segment to offer promotional programs to attract and stimulate consumer demand.

In addition to short-term challenges, inherent difficulties still “tie” the retail industry to development. At the beginning of doing business, the retail industry faced many difficulties such as: B. finding premises, training retail staff (still no formal training schools)… Once the premises have been searched, finding the documentation, mechanisms and guidelines to open a new outlet is also a challenge. Although this barrier has recently been progressively removed, it is still slow and hampering business opportunities for companies.

Digital transformation is a trend in retail industry in Vietnam in the new era, how do you see this trend?

Sales through e-commerce channels thrived during the pandemic. Retailers invest heavily in technology and staff to meet the demands. Manufacturers also use their own websites, e-commerce sites, and social networking platforms to encourage consumption. This is also the trend of retail in the coming period, especially for agricultural products.

The association is also currently developing a project for the digital transformation of retail. Digital transformation in retail is helping businesses check out faster thanks to automated payments in stores and supermarkets. In particular, companies can use AI technology and sensor fusion technology to automate the payment process. This gives customers a better shopping experience…

What do Vietnamese goods have to do to be present on the shelves of modern supermarket systems, ma’am?

In order to enter the modern retail system such as supermarkets and commercial centers, I believe manufacturers must comply with retailers’ regulations and criteria. This criterion is based on the needs of consumers and government administrations. Therefore, retailers must impose these regulations on manufacturers. Specifically, the design of the product packaging must be eye-catching, the criteria on the packaging must comply with the regulations indicated on the label. In addition, product quality is an extremely important criterion that always comes first.

In particular, most goods, especially food, must be stamped with a QR code on the product for traceability. This is one of the breakthrough technology solutions today, being able to track and identify a product unit at every stage of the production, processing and distribution process.

What do you think the retail industry needs to do to find opportunity in the next normal period?

Over the years, the industry has gone to great lengths to stay in the market. In the coming period, the industry must promote its strengths and overcome its weaknesses.

The weakness of retail is that corporate governance is still weak compared to 100% foreign-owned companies in the same industry as retail management differs from other industries. Running a retail business from input to output requires mastery of the key points in business operations. Overcoming these weaknesses will help companies remain steadfast and compete in the marketplace; At the same time, it is necessary to regularly train managers from the middle level upwards.

In addition, there should be a link between retailers and suppliers to discuss market developments, finished goods status, seasonal forecasts, etc. good goods, diversify products… to attract customers. Work with manufacturers and suppliers to get the best promotions to stimulate consumer demand.

In addition, it is necessary to regularly monitor and record all developments in the world regarding imported goods, raw materials for domestic production, etc., in order to adapt and be flexible in all situations.

Apart from the efforts of the retail companies themselves, the companies always want the government to pay more attention to the industry. At the moment, the prevailing mindset is that retailers are traders, so traders have to do it themselves, but in my opinion, retail is a bridge, if retailers don’t do their job well, the economy will stagnate.

How do you assess the prospects for retail in 2023? Will existing retailers continue to expand their business or are new investors jumping into this space, ma’am?

Obviously, after a period of “serious illness” and the recovery of the “health” of the industry, there will certainly be a strong rebound. Retail is always a vibrant industry with both domestic manufacturers and overseas retailers always in the mood for movement.

My forecast is that the retail industry will thrive in 2023 for domestic retailers in particular and overseas retailers in general. This will be the year of real post-pandemic retail recovery.

In the two years of the strong outbreak of the pandemic, some retailers had to close and only keep good sales locations. But in 2023, many signals indicate that they will reopen and even look for new premises to expand the system and market.

In particular, there will be new investments by foreign retailers in Vietnam. Domestic retailers also expect to gain a foothold in the market by shaking hands with overseas partners. This is a normal collaboration if you want your business to be “healthy” in the current context.

VnEconomy December 7, 2022 11:00 am

The content of the article was published in Vietnam Economic Review No. 49, published on December 5, 2022. Welcome readers to read This:

https://postenp.phaha.vn/chi-tiet-toa-soan/tap-chi-king-te-viet-nam