Up to now, Vietnam is easing social distancing campaign gradually, FRT – the owner of Long Chau chain – accordingly will launch many practical incentives for the customers.
As one of the units that have been affected heavily by Covid-19 epidemic when the factories in China were locked down from operation, FPT Retail (FPT) has witnessed an increase in profits to VND 35,6 billion in the first quarter.
Promotions will be increased to bolster up the consumers’ demand after social distancing
Sharing with us, the Company’s representative said that the Covid-19 epidemic had a quite serious and multi-dimensional impact on all economic and social fields of our country. Especially for retail companies such as FRT, the difficulties brought by the epidemic are even more pronounced. The previous period of social distancing has somehow affected the business results of our Company. Accordingly, the turnover of March 2020 was decreased by 20% compared to February 2020.
“However, there are even opportunities in challenges, in the epidemic, the trend has been shifted to online shopping, the demand for personal devices to work from home has escalated, FRT has taken advantage of that to sell products, which has improved the risk management. This is also a big hit for FRT to be more creative in order to overcome the difficulties and discover new values”, FRT’s side said.
According to the statistics, FPT Shop’s laptops’ turnover in January 2020 was up by 79% compared to that of January and its turnover in March was up by 172% compared to January, “FRT will continue investing in this segment in the long term”.
At the moment, Vietnam is easing social distancing step by step, FRT accordingly will launch many practical incentives for the customers. To be specific, in this May, FPT Shop will offer big discounts for mobile phones, laptops and the customers can buy pay for many products in instalments with 0% interest and with a prepayment of from only VND 399,000. Concurrently, FPT Shop will also offer free anti-bacteria hand sanitizers and offer home delivery within 60 minutes.
The retail industry is expected to reach USD 180 billion in 2020: FRT will maintain the ICT in order to have new business expansion strategies
According the report of Vietnam Report, in the past few years, the retail industry in Vietnam has experienced rapid growth. The compound annual growth rate (CAGR) in the period 2013 – 2018 was 10,97%. The total retail revenue is expected to reach USD 180 billion in 2020, equivalent to an increase of 26,6% from 2018. However, the dramatic rise of digital and e-commercial retail channels is also worth high attention in the near future.
According to the forecast of World Bank, household expenditure will increase by 10,5% per year on average with the strong growth of middle class. Currently, about 70% of the Vietnam’s populations is financially secured, of which 13% is the middle class according to the world’s standard. Income of those people in this class are rapidly growing, which is very likely to reach 26% in 2016. From 2014, approximately 1,5 million of Vietnamese have joined the middle class per year on average, which indicates that households are reaching higher steps in the economic ladder after escaping the poverty. Economy growth, living-standard improvement and the increase of middle class are solid foundations to bolster up the extension of retail industry in the coming time.
Accordingly, in 2020, FPT Retail will continue to maintain the ICT chain so as to keep the growth rate the same as that in 2019. This is also a fulcrum for FRT to invest and extend new business paths. FRT plans to increase the revenue of the store chain by starting to sell sun glasses and watches in the form of shop-in-shop.
In 2020, there will be 200 new Long Chau pharmacies
In the pharmaceutical industry, there are 83 Long Chau pharmacies spreading across 19 provinces and cities, up 13 stores compared to the end of 2019. Up to now, Long Chau has decided on 40 locations to open new stores in the second quarter of 2020. It is foreseen that Long Chau may reach 200 stores at the end of 2020.
“FPT Retail’s current strategy is to expand the coverage nationwide, accounting for 30% of the pharmaceutical retail marker share through pharmacies in 2 to 3 years”, said the chain’s representative.
In the annual report of 2019, FRT assessed that the pharmaceutical industry in Vietnam is considered attractive for investors. According to BMI, the revenue in this segment will increase from USD 7.7 billion in 2021 to USD 16.1 billion in 2026. The compound annual growth rate will reach 11% in Vietnam Dong.
On the other hand, the pharmaceutical retail industry in our country is very fragmented. Because the average income and health awareness is becoming higher, people tend to choose modern, branding and GPP-standard pharmacies (with good pharmacy practices) instead of small and unqualified pharmacies. This shift is being accelerated party thanks to the Government’s policies that control the pharmaceutical retail industry via pharmacies (Circular 02/2018/TT-BYT regulating on good pharmacy practices)
For FRT, after discovering the secret to success for Long Chau chain, in 2020, FRT plans to expand the chain to 220 stores and increase the coverage nationwide. In the long-term plan, FRT sets goals to develop the pharmaceutical segment in a methodically planned and controlled manner the same as the operation of digital retail segment.
According to Tri Tuc, CafeF
Published May 7, 2020