Purchasing power of retail market on the rise

10:20 | 13/08/2014

VGP – Viet Nam’s total retail sales and service revenues touched around US$ 125 billion in 2013, representing a year-on-year increase of 12.6%, according to the Ministry of Industry and Trade (MoIT).

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Deputy Director of the MoIT’s Competition Management Department Nguyen Phuong Nam made the announcement yesterday in Ho Chi Minh City at a workshop on protection of customers’ rights in electronics market.

In the first seven months of 2014, in spite of numerous economic challenges, total retail sales valued about US$ 79 billion, up 11.42% against 2013. The trade sector continued to account for a large proportion with 76.75%; followed by restaurants and hotels 12.06%; service 10.26% and tourism 0.93%.

According to a report of GFK , the fourth largest market research organization in the world, total sales in Q1, 2014  in the electronics market picked up 27.5% against the same period last year and outstripped VND 35 trillion (a record high), of which telephone was up 37% and household electronics 20%.

It showed promising signs of improved purchasing power with a monthly growth of 11-12%.

The better performance stemmed from controlled inflation rate, it was said.

However, the share of modern retail sales fails to meet the potential of 33% of population in urban areas due to weak traditional distribution channels with 55% held by SMEs enterprises.

Vietnamese retailers were suggested to consolidate and open up outlets and develop new modern retail models./.

By Kim Loan