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Công ty CP Bán Lẻ Kỹ Thuật Số FPT / Company infomation  / From the number 0 to the second position in the mobile retail industry with the turnover of 10,000 billion, what is the next step of FPT Shop?
Dragon Capital đã nắm 20% vốn FPT Shop, VinaCapital giữ 15%
3 Aug

From the number 0 to the second position in the mobile retail industry with the turnover of 10,000 billion, what is the next step of FPT Shop?

Despite of a follower in mobile retail field, FPT Retail shows that they have the right business strategy to rise into the market leader.

Opening 370 stores four years

In any business branches, the general formula is always two leading companies will have a majority of turnover and profits. Coca and Pepsi is presented for beverage industry, while Apple and Samsung are the top brands of mobile production. Also in the mobile retail sector in Vietnam, Thegioididong and FPT Retail is the leader.

In 2012, FPT retail has officially entered the mobile retail field with two brands: FPT Shop and F.Studio by FPT (F.Studio specializing in Apple’s products). It can be seen that FPT Retail has a much slower starting point than its competitors in the market. This enterprise decided to jump in when all size brand names, segments were formed. This can be considered a risky decision by the “underdog” (the following company in the market), therefore FPT have been required a combination of strong potentials to be able to jump up.

It is a strategy to expand continuously and follow closely  to the “leaders” in the market.

In the first year, FPT Retail owned 50 stores. Three years later, the  of stores is 370. The increasing the number of stores more than seven times within a few years is conforming to the rules of the retail industry: Growth strongly and revenue scale largely before calculating the profits.

Therefore, the number of stores reached 100 and turnover reached VND2,900 billion in 2013. FPT Retail still got negative profit lightly. The top manager of FPT Retail calculated that it may take one more year to begin getting the profit from retail chain.

However, the results were better than expecting. In 2014, FPT Shop had 160 stores, the turnover nearly doubled from last year’s  with VND5,200 billion and the profit before tax is VND40 billion. FPT Retail’s turnover is ranked second in the mobile retail market. This position is still maintained to the present outdistances  the following competitors such as Vien Thong A, Nhat Cuong, CellphoneS, …

By 2015, the number of stores is with the speedy growth, FPT Shop revenue reached 7.800 billion and profit before tax increased 4.5 times compared to the previous year reached 180 billion. By the end of 2016, FPT Shop will develop to have 370 stores, the expecting turnover and profit before tax are expected to reach VND10,700 billion and VND250 billion.

Next step

Despite of the development, growth is also expected to slow down with the overall downward trend. The mobile retail field in Vietnam is forecasted to be saturated in the next few years. Therefore, it’s a challenge for FPT to find a solution for the question “what will be done to develop continuously?

Mrs. Nguyen Bach Diep, general director of FPT Retail, said that the mobile retail market in Vietnam still has many opportunities.

“According to GFK, mobile retail chains account for about 70% of the market, while the remaining 30% are still belong to retail outlets, so the opportunity for FPT Shop to continue expanding its coverage area still remain. In spite the forecast for each year, the growth of mobile phone segment is only about 5%, but in fact the end-users switch from cellphones to Smartphones increasingly which help smartphones growing with double digits each year. This is the basic for us to develop in the coming years.”

In the first 10 months of 2016, FPT Retail increased 32% in revenue and 44%  in profits. In particular, e-commerce is an area that FPT Retail has invested in and gradually become a bright spot. Revenue in the first ten months was over VND 1 trillion, about $ 45 million and 227%  compared with the same period last year.

In general, online sales or e-tail in Vietnam has not really thrived, and only e-tail sector can not be the complete answer for FPT Retail. However, according to the data we collected, the revenue plan in e-commerce segment of FPT Retail in the year after 2017 is expected to double in 2016.

At the same time, according to forecasts of leading companies in the world about this field, Vietnam is the potential region of developing the largest e-tail in the world and will be exploded in the near future. A attention point is that FPT Shop’s the website has triple visitors and is expected to reach 800,000 sessions per day by the end of this year.

According to representatives of FPTshop, the company is preparing for future directions in addition to continuing to expand the coverage of district level 2 in the coming years:

With the “plough deep and to the hoe with great force” policy, FPT Shop is implementing a series of projects to exploit more and more customers in the market, approach the customers, and make them to the shop chain.

The second strategy is applying the advantages of chain experience, retail experience, technology applications in to management … FPT Retail is researching, searching, testing new business field with a lot of potential and parallel with FPTshop chain in order to generate revenue and profit growth for the following years.

The third one is loyal to the policy of “dedicated to serving customers”, FPT Retail is determined to operate and build customer service style for all business sectors whether it’s new or old, which is  the foundation for sustainable growth.

“Following these options, the problem of what to be done  to develop FPT Shop continuously will be resolved,” she said

 

Thái Bình

Tri Thuc Tre Magazine

(Source: Cafe Biz)