The retail market in Hanoi is still attractive for investors, eventhough it has experienced business impediments during the past, a HanoiIndustry and Trade Department official said.
Lastyear was continuously marked by numerous fluctuations in the modernretail market nationwide, as well as in Hanoi, which encountered manychallenges in business, said Tran Phuong Lan, Director of theDepartment.
Some trading centres in the city had tosell or temporarily stop their operations, including the Thai BerliJucler Group buying Metro Vietnam, and the operations at ParksonLandmark 72 and Trang Tien Plaza being stopped for restructuring ofretailers in the plaza, Lan stated.
The market shareof the modern retail model stooped to a new low, she said, with thecirculation of good in the modern distribution system accounting for 15percent of the market and other goods distribution systems beingtraditional markets and sale agents of producers.
These trading centres faced difficulties in business because there was agrowing supply of retail spaces in the medium and high-end segments,while almost all retailers were small and medium-sized enterprises, Lanexplained.
They have also found it difficult to seekretail spaces that were suitable for their financial ability. If theyleased spaces in trading centres for a high rent, their goods would alsohave to be priced higher and would become difficult to sell.
Meanwhile, low purchasing power at present due to the economic crisisalso affected the consumption of goods at these trading centres, saidLan, adding that customers could also buy goods via other channels, suchas online trading, direct orders at home and through sales agentsabroad and did not need to go shopping at trading centres.
However, in general, trading centres in Hanoi follow a highdevelopment level, and have garnered attention from many foreign andhome investors, such as the South Korean Lotte Group, the Japanese AEONGroup, the Thai Central Group and Vietnam's Vingroup, according to Lan.
According to CBRE's report, Hanoi was ranked 13th inthe list of 19 hot retail markets in the world and one of the top tencities in the world that retailers planned to open their retail systemin 2014.
This is because the retail system in Hanoihas been developed strongly in scale and quality to meet demand from thelocal people and foreign visitors.
In 2015,approximately 397,000 sq. m of retail space from 19 projects enter themarket. Of these, two projects have been completed, but their openingdate is uncertain, and nine projects are currently being fitted out,according to Savills Vietnam.
In 2016, five projects will come online with an area of 356,000 sq. m. Four projects are currently under construction.
"The retail market is on its way to improvement and seems to havefound the right direction. The new trend is focused on developingsupermarket models, food and beverage items and entertainment, with themain purpose being satisfying the clients' needs," said Do Thu Hang, theHead of Research and Consultancy, Savills Hanoi.
According to CBRE Vietnam stable economic factors in the future are expected to boost sales and boost buyers' confidence.
Rents are constantly dropping to maintain occupancy, but at a modestpace. The expansion of retail space and the arrival of new entrants areexpected to drive the retail market in 2015 due to Vietnam's commitmentsto the World Trade Organisation. But, the Economic Needs Test (ENT) hasremained a barrier for foreign retailers.
Projects havebeen restarted and the production of future supplies has sped up,following an economic recovery, according to the report.-VNA
Lastyear was continuously marked by numerous fluctuations in the modernretail market nationwide, as well as in Hanoi, which encountered manychallenges in business, said Tran Phuong Lan, Director of theDepartment.
Some trading centres in the city had tosell or temporarily stop their operations, including the Thai BerliJucler Group buying Metro Vietnam, and the operations at ParksonLandmark 72 and Trang Tien Plaza being stopped for restructuring ofretailers in the plaza, Lan stated.
The market shareof the modern retail model stooped to a new low, she said, with thecirculation of good in the modern distribution system accounting for 15percent of the market and other goods distribution systems beingtraditional markets and sale agents of producers.
These trading centres faced difficulties in business because there was agrowing supply of retail spaces in the medium and high-end segments,while almost all retailers were small and medium-sized enterprises, Lanexplained.
They have also found it difficult to seekretail spaces that were suitable for their financial ability. If theyleased spaces in trading centres for a high rent, their goods would alsohave to be priced higher and would become difficult to sell.
Meanwhile, low purchasing power at present due to the economic crisisalso affected the consumption of goods at these trading centres, saidLan, adding that customers could also buy goods via other channels, suchas online trading, direct orders at home and through sales agentsabroad and did not need to go shopping at trading centres.
However, in general, trading centres in Hanoi follow a highdevelopment level, and have garnered attention from many foreign andhome investors, such as the South Korean Lotte Group, the Japanese AEONGroup, the Thai Central Group and Vietnam's Vingroup, according to Lan.
According to CBRE's report, Hanoi was ranked 13th inthe list of 19 hot retail markets in the world and one of the top tencities in the world that retailers planned to open their retail systemin 2014.
This is because the retail system in Hanoihas been developed strongly in scale and quality to meet demand from thelocal people and foreign visitors.
In 2015,approximately 397,000 sq. m of retail space from 19 projects enter themarket. Of these, two projects have been completed, but their openingdate is uncertain, and nine projects are currently being fitted out,according to Savills Vietnam.
In 2016, five projects will come online with an area of 356,000 sq. m. Four projects are currently under construction.
"The retail market is on its way to improvement and seems to havefound the right direction. The new trend is focused on developingsupermarket models, food and beverage items and entertainment, with themain purpose being satisfying the clients' needs," said Do Thu Hang, theHead of Research and Consultancy, Savills Hanoi.
According to CBRE Vietnam stable economic factors in the future are expected to boost sales and boost buyers' confidence.
Rents are constantly dropping to maintain occupancy, but at a modestpace. The expansion of retail space and the arrival of new entrants areexpected to drive the retail market in 2015 due to Vietnam's commitmentsto the World Trade Organisation. But, the Economic Needs Test (ENT) hasremained a barrier for foreign retailers.
Projects havebeen restarted and the production of future supplies has sped up,following an economic recovery, according to the report.-VNA
