Retailing according to the model of "buying at the source, selling at the end"

Businessman Vu Dinh Phuong, CEO of Tom Fruits: Retailing according to the model of "buying at the source, selling at the top"

Providing essential goods at prices 25-30% lower than market prices, businessman Vu Dinh Phuong, CEO of Tom Fruits, is confident that he will succeed in his own way, soon reaching the milestone of 300 points of sale by the end of 2025.

The "U-turn" after many failures

In the last days of 2023, CEO Vu Dinh Phuong was busy with the plan to open 2 new retail stores of the Tom Fruits system at 74 - Nam Dong and 307 - Nguyen Van Cu ( Hanoi ). Thus, Tom Fruits has 32 points of sale opened within 5 years (2019-2023), minus nearly 2 years of interruption due to the Covid-19 pandemic, which means that every month there is a new point of sale introduced to the people of the Capital.

In early January 2024, Tom Fruits continued to welcome its 33rd new member at 540 - Truong Dinh (Hanoi). "My ambition is to reach 300 retail points by the end of 2025 and the next 2 years are the peak for me to realize this goal," said Mr. Phuong.

Having failed with several start-up projects, from computer business, construction material supply, logistics, so when switching to retail, Mr. Phuong did not have too big expectations.

“At the most difficult time in 2018, my wife and I decided to do online business with the thought that we didn’t need much capital and could start right away. I focused on daily essential consumer products and shipped them directly to consumers, as long as we had money to cover our daily expenses,” Mr. Phuong recounted.

But this “turnaround” not only helped his family overcome difficulties faster than expected, but also nurtured and opened up new business ideas for this businessman born in 1989. A year later, in 2019, the first retail store under the brand name Shrimp Fruits Retail Warehouse under Vietnam Shrimp Fruits Investment Company Limited was launched.

Initially, Tom Fruits specialized in importing and distributing fruits and food from the US, Australia, New Zealand, Chile, etc., and gradually expanded its product portfolio. When the Covid-19 pandemic broke out, the system expanded to include food, consumer goods, household appliances, etc.

Although doing retail business of essential consumer goods, Mr. Phuong does not follow the mass approach, because he cannot compete with established names in the market. Tom Fruits' orientation is to become a large-scale retail warehouse of essential goods, helping consumers save maximum costs.

“Tom is my son's name and the warehouse represents the desire to import goods directly from the factory, link production, skip distribution steps, reduce intermediary costs, and bring products at good prices to the end consumer,” the CEO of Tom Fruits explained.

For any business model, especially in the retail industry, the factors that directly affect consumer purchasing behavior are product quality and price. Mr. Phuong determined that it was necessary to find and gather suppliers with large enough output, cutting out the middleman as much as possible, so that the selling price of goods was always lower than the market price.

Always respect the word "Trust"

Without formal training in business operations, his knowledge of retail was almost zero, but when he entered the business world, Mr. Phuong always tried to learn so as not to get "lost" and fall behind.

After failing in the computer business, he turned to construction projects, but was also unsuccessful, even losing all his savings. When he started Tom Fruits, Mr. Phuong was completely broke and had to borrow money to restart his business.

The first three years are a difficult period for most startups, and Tom Fruit was also hit by the pandemic. “The luckiest thing for me in this startup journey was choosing the essential goods business, so sales still grew while other business sectors were disrupted by the pandemic,” said Mr. Phuong.

The pandemic unfortunately happened, but it gave Tom Fruits a strong "boost". That boost lies in the warehouse business model, importing goods directly from domestic factories, or import businesses, buying in large quantities, then selling directly to consumers.

Thanks to that, the selling price of Tom Fruits products is often 20 to 30% cheaper than the market price, some products are up to 40% cheaper. Many retail stores even import goods from Tom Fruits warehouse to resell and still satisfy the profit factor. In addition, through online operating systems such as apps and websites, Tom Fruits has optimized costs and customer experience.

In any business, especially with essential consumer goods, one must never think of using tricks to make more profit - that is the business motto of the owner of Tom Fruits. "I believe in the law of cause and effect, believe in the word 'Trust'. When we do business honestly, kindly, responsibly and constantly improve, customers will not let us down", Mr. Phuong confided.

Remember, there was a period of mask shortage, many places inflated the price by hundreds of thousands per box, but Tom Fruits' system only sold it for 19,000 VND/box, because the manufacturers "shared the burden". Tom Fruits imported goods directly from the manufacturer and determined not to calculate the profit for this item, because it only wanted to serve many customers during the peak of the epidemic.

The goal of opening 300 retail outlets of CEO Tom Fruits is not too far-fetched. To prepare for the breakthrough phase in terms of sales points, Tom Fruits has completed the operating process, creating a springboard for the 2024-2025 period, and building professional departments.

“If not now, it would be difficult to have the opportunity. After the pandemic, retail premises are very available, we have never closed a lease contract as smoothly as now. From my own experience, I realize that capital is not too big of a problem. If we build up the word 'Trust', partners and customers will always trust and accompany us,” Mr. Phuong shared.

Constantly learning, doing business honestly, not taking shortcuts, focusing on the values that the business brings to customers, businessman Vu Dinh Phuong has many opportunities to experience new business ideas.

“Business will not have this difficulty, but other difficulties will appear. At this time, the global and domestic economies are both growing slowly, but I believe this difficulty is only short-term, the Tom Fruits model is developing under control,” Mr. Phuong confidently said.

Failure is the foundation for growth

Why did you choose food retail and not another business?

At first, I didn't think I would do big with this business, my husband and I just wanted a job to sustain our lives and get through the most difficult period. But when we started doing it, seeing the good effects, I had more energy to achieve new goals.

What do you think about failure? Having experienced many business fields and many failures, what do you appreciate most?

For me, failure is the foundation for development, thanks to failure we can learn many lessons and life experiences. What I appreciate most is that I can change constantly. Life does not go as I want, forcing me to keep up with the changes of the market.

Imagine Shrimp Fruits in 5 years?

Shrimp Fruits will become a trade, service and production corporation operating nationwide with three main pillars: trade (retail, import-export, distribution) - providing services revolving around the ecosystem - investing in production.

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