What solutions will help support the retail industry in the last 4 months of the year?

According to economic experts, the Vietnamese retail market is increasingly vibrant with the participation of many large enterprises and business households.

Competition in the retail market is also extremely fierce because consumer demands are increasingly strict, and competitors are constantly improving to become more professional and modern.

From now until the end of the year, businesses will have less than 4 months to complete their plans and set goals such as expanding the market, promoting consumption activities to increase commercial production.

Therefore, supporting and promoting the retail business community will be a huge challenge, requiring timely mechanisms from policy-making agencies, localities and the internal strength of businesses.

Commenting on the picture of the Vietnamese retail market in the coming time, Mr. Nguyen Anh Duc, General Director of Saigon Co.op and Chairman of the Vietnam Retailers Association, said that the Vietnamese retail market in recent years has always had the world's leading attractiveness.

According to an independent assessment by a market research company, this attraction comes from the relatively high population size of Vietnam, the participation rate of modern retailers is still very low, just over 20%, so there is still a lot of room for development.

However, the current limitation of the retail market is the lack of concentration and the absence of large-scale retailers, especially in the e-commerce industry.

"I feel that retailers operating in the e-commerce sector are still quite fragmented and small, so they have not created large resources for development," said Mr. Duc.

In addition, another limitation is that the resources of domestic retail enterprises are still inferior to foreign retailers. The recent decline in purchasing power in the retail industry is also the first reflection showing the existing challenges that this industry is facing and the need for actions to adapt and change with the trend of the times, with changes in consumer habits and culture.

Along with that is the support from positive policies and solutions of state management agencies.

For example, the recent reduction of value added tax from 10% to 8%, retail businesses must implement very quickly so that the new price level can support market purchasing power. Or the solution related to the cooperation of units in the retail industry, creating a stimulus of an overall nature for the economy to have better support.

Retailers must be the units that directly reflect the voice of consumers and manufacturers to create a comprehensive chain in the current supply and demand stage.

Saigon Co.op itself is also negotiating with Saigontourist Group, Vietravel... to implement these cross-stimulus programs, Mr. Duc shared.

Mr. Duc recommended: "With limited potential and resources, domestic retail businesses should not use finance to compete directly with foreign 'giants' with a lot of money.

Businesses need to compete with their core advantages, which market they understand best, which retail model they do best, and avoid spreading themselves too thinly on a large scale. We may not be the largest retailers, but we will be the most professional retailers. The more domestic retailers participate in the market, the higher the proportion of domestic retail will be."

From a research perspective, Ms. Dinh Thi Bao Linh, Deputy Director of the Center for Industry and Trade Information (Ministry of Industry and Trade) said that in the context of fierce competition, along with strong changes in the method of distributing goods based on science and technology, especially technology from the Fourth Industrial Revolution, domestic retailers are facing many big challenges.

International integration in both economy, technology and culture is promoted by the trends of the Fourth Industrial Revolution, so it will have a faster and stronger impact on the Vietnamese retail market in the coming years.

Consumer demographic changes will occur at an unprecedented pace, creating ever-expanding and diverse needs and wants.

Along with that, changes in average age, related diseases... can also have impacts on the structure of consumer goods and the retail industry.

Therefore, with international integration, the retail business community is no longer simply buying and selling a product but will have to expand to support services and consumer experiences.

To compete, retailers constantly need to innovate offline and online sales channels, provide quick last-mile support services such as home delivery, same-day delivery, apply online tools to help customers select/try on/convert/return products (e.g. clothes, shoes, sandals), as well as make electronic payments as fast and convenient as possible...

These will be huge changes that if retail businesses do not adapt, it will be difficult to stand firm in the market, Ms. Dinh Thi Bao Linh emphasized.

According to a report from the General Statistics Office, total retail sales of goods and consumer service revenue in July 2023 is estimated at VND 512.2 trillion, up 1.1% over the previous month and up 7.1% over the same period in 2022.

In the first 7 months of 2023, total retail sales of goods and consumer service revenue at current prices are estimated at VND 3,529.8 trillion, up 10.4% over the same period in 2022./.

Source