Vietnam Retail Market Size and Growth | Industry Analysis 2028

The Vietnam retail industry has experienced remarkable growth in recent years, emerging as a dynamic and lucrative market. The current size of the Vietnam retail market is estimated to be around USD 180 billion in 2022, with a projected compound annual growth rate (CAGR) of 9.2% from 2023 to 2028, reaching an estimated value of USD 280 billion by 2028.

This remarkable growth can be attributed to several key factors:

1. Rising Disposable Incomes: The steady economic growth in Vietnam, coupled with the expansion of the middle-class population, has led to a significant increase in disposable incomes, driving consumer spending and fueling the growth of the retail industry.
2. Demographic Shifts: Vietnam’s large and young population, with a median age of 32.5 years, has contributed to the growing demand for a wide range of retail products and services.
3. Urbanization and Changing Lifestyles: The rapid urbanization of Vietnam, particularly in major cities like Ho Chi Minh City and Hanoi, has led to a shift in consumer preferences towards modern retail formats, such as shopping malls, supermarkets, and e-commerce platforms.
4. Expansion of Organized Retail: The increasing presence of both domestic and international retail chains, along with the development of modern retail infrastructure, has helped to drive the growth of the organized retail segment in Vietnam.

Market Future Analysis

The future of the Vietnam retail industry looks promising, with several key trends expected to shape its growth:

1. E-commerce Boom: The rapid growth of e-commerce in Vietnam, driven by the increasing internet and smartphone penetration, is expected to continue, with online sales projected to account for a larger share of the overall retail market.
2. Omnichannel Retail: Retailers in Vietnam are increasingly adopting an omnichannel approach, integrating their physical stores with online platforms to provide a seamless shopping experience for consumers.
3. Premiumization and Diversification: Vietnamese consumers are becoming more discerning, seeking premium and specialized products, leading to the growth of niche retail segments, such as luxury goods, organic and healthy products, and experiential retail.
4. Sustainability and Environmental Consciousness: The growing focus on environmental sustainability and ethical consumption is driving the demand for eco-friendly and socially responsible retail offerings.
5. Mergers and Acquisitions: The Vietnamese retail industry is likely to witness increased consolidation, with larger players acquiring smaller brands or regional players to expand their market share and product portfolios.

Market Major Players

The Vietnam retail industry is dominated by a few major players, each with its unique strengths and market strategies:

1. Vingroup: Vingroup is a leading Vietnamese conglomerate with a strong presence in the retail sector, operating a diverse portfolio of retail brands, including VinMart (supermarkets), VinMart+ (convenience stores), and VinShop (online marketplace).
2. Masan Group: Masan Group is a prominent Vietnamese company with a significant presence in the retail industry, owning brands such as WinMart (supermarkets) and WinMart+ (convenience stores).
3. Central Retail Corporation: Central Retail Corporation, a Thai retail giant, has expanded its operations in Vietnam, acquiring and operating a range of retail formats, including supermarkets, department stores, and specialty stores.
4. Saigon Co.op: Saigon Co.op is a leading Vietnamese cooperative retailer, operating a network of supermarkets, hypermarkets, and convenience stores under the Co.opmart and Co.op Food brands.
5. FPT Retail: FPT Retail is a Vietnamese technology and retail company, operating a chain of consumer electronics and IT product stores under the FPT Shop brand.
6. AEON: AEON, a Japanese retail conglomerate, has a significant presence in the Vietnamese market, operating shopping malls, supermarkets, and specialty stores.
7. Lotte Mart: Lotte Mart, a South Korean retail giant, has established a strong foothold in the Vietnamese market, operating a network of hypermarkets and supermarkets.

Conclusion

The Vietnam retail industry is poised for continued growth, driven by the rising disposable incomes, demographic shifts, urbanization, and the expansion of organized retail. The market is characterized by a diverse range of players, each offering a unique value proposition and catering to the evolving needs of Vietnamese consumers.

As the market continues to evolve, it will be crucial for retailers to stay ahead of the curve, investing in innovative technologies, diversifying their product offerings, and ensuring a seamless omnichannel experience. The growth of e-commerce, the focus on premiumization and sustainability, and the potential for mergers and acquisitions will further shape the future of the Vietnamese retail industry.

The Vietnam retail market presents a promising opportunity for both domestic and international players. With the increasing purchasing power of the growing middle class, the rapid urbanization, and the government’s efforts to promote economic development, the market is poised for continued expansion in the coming years. Retailers that can effectively navigate the changing market dynamics and align their strategies with the evolving consumer preferences will be well-positioned to capture a larger share of this dynamic and lucrative market.