It is expected that in 2020, Vietnam retail market will gain US$11 billion from online retail, compared to US$4 billion in 2015, according to predictions just announced by Savills Vietnam, one of leading real estate consultancy firms.
The research also shows that Hanoi and Ho Chi Minh City has the potential to develop the modern retail industry with Ho Chi Minh city developing faster. In the modern retail structure, shopping centers which account for 57 per cent in Hanoi and 50 per cent in Ho Chi Minh city are dominant.
According to the research on Vietnamese retail market of Savills, the largest and most experienced real estate practice in Vietnam, Hanoi and Ho Chi Minh city retail markets have the strong future growth potential as their retail densities are still low, at 0.17 and 0.13 m2/pax respectively, while the urbanization has increased strongly.
Nowadays, with the breakthrough of information technology in addition to the large and growing labor force, the retail market in Vietnam has been developed guidely. Specifically, more than half of the population are estimated to use the internet which takes a lot of time of people, especially when 38 per cent of Vietnamese population have smartphones. With the support of credit cards, it has become easier than ever for people to find and purchase the services they need online. According to Savills, the emerging market is learning to love online retail and adapting quality.
Vietnam currently has about 31.5 million people living in urban areas, making it the second highest urban population in the region. Besides, due to the huge flows of rural migrants to seek for better living conditions, the rate of urbanization has increased significantly, which has partly contributed to the development of Vietnam economy when Vietnam’s GDP growth remains high over the years. All of these factors have promoted the spending in Vietnam, especially in urban cities with the spending growth in 2016 reached 7.0 per cent.
Besides, the globalization and international exposure have encouraged the gender diversity and more brands in Vietnam’s retail market. In 2016, there were 149 international brands wanting to be in Vietnam market with food and beverage which accounted for 38 per cent leading the charge.
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