Aggregate retail sales of consumer goods and services in Vietnam's Binh Duong province have surged by 12.4 percent year-on-year in 2023. International retailers will find multiple growth opportunities in this fast-growing industrial province due to its higher spending power per capita and demographics.
Hotspot for consumer retail
Situated in close proximity to the bustling Ho Chi Minh City, Binh Duong Province has emerged as an enticing hotspot for both foreign and domestic retailers, propelled by a booming economy, favorable demographics, and strategic location. This southern Vietnamese industrial hub has recently witnessed the introduction of Aeon Vietnam's compact general merchandise store and supermarket, mirroring the success of its Hanoi counterpart established the previous year.
Spanning an impressive 5,000 square meters, this supermarket not only features a well-designed shopping area but also boasts a diverse food court offering culinary delights from Vietnamese, Japanese, South Korean, and Thai cuisines. The choice of Binh Duong as the launch site for this innovative retail concept in the south was driven by its promising economic potential and burgeoning population.
Binh Duong's strategic proximity facilitates convenient travel for individuals while maintaining a comfortable distance from the competitive commercial epicenters within HCMC.
International retail giants like Central Retail, Mega Market, and Lotte have recognized Binh Duong's allure and made strategic investments in the region. Intriguingly, the province has also witnessed the entry of premium brands that were once deemed beyond the reach of the local population.
Uniqlo, having established a successful presence in HCMC, Hanoi, and Hai Phong, has extended its footprint to Binh Duong. Fresh from the inauguration of its maiden outlet in June, the Japanese fashion retailer is poised to open a second store in the upcoming fall or winter, marking an impressive 20th store in Vietnam.
Similarly, Starbucks, renowned for its premium coffee offerings, inaugurated its third Binh Duong outlet last month, capitalizing on the province's burgeoning consumer base.
In a strategic move, Glam Beautique, specializing in health and beauty products, chose Binh Duong as the ideal location for its eighth store in the country.
A defining factor driving Binh Duong's prominence is its expansive market size. Notably, the province witnessed a robust 12.4 percent year-on-year increase in retail sales of consumer goods and services in 2023, totaling VND 174.82 trillion (approximately US$7.4 billion). This places it in the company of major players, such as HCMC and Hanoi.
In a noteworthy evaluation by Colliers, Binh Duong's retail real estate market stands second only to HCMC, poised to emerge as the preferred destination when the latter struggles to satisfy escalating demands.
According to the General Statistics Office (GSO), Vietnam's total retail sales of consumer goods and services in the first seven months of 2023 rose by 10.4 percent year on year, reaching nearly US$149 billion.
When excluding the influence of price fluctuations, the seven-month sales witnessed a rise of 9.6%, in contrast to the 11.7% expansion experienced during the same period in the previous year.
Furthermore, when analyzing growth rates, Binh Duong emerges as a standout performer, trailing only Da Nang (22%) and Hai Phong (13.6%).
Binh Duong hosts 30 industrial parks alongside 12 industrial clusters, cultivating a thriving business environment. The region has successfully attracted over 3,400 foreign enterprises, channeling a substantial investment of US$40 billion into a total of 4,121 projects. Binh Duong is placing emphasis on cultivating foreign investment in burgeoning sectors, with particular focus on green industries and hi-tech sectors.
The demographics of Binh Duong paint a compelling picture. With a per capita income of VND8.076 million per month, despite being ranked sixth in population nationwide, the region stands out as a hub of affluence and potential. The presence of a highly skilled and qualified workforce, coupled with their demand for a wide range of amenities including housing, leisure, healthcare, and education, amplifies the province's appeal as a retail destination.
In essence, Binh Duong's allure as a magnet for investors and retail brands is rooted in its rapid socioeconomic growth and robust infrastructure, rendering it a prime canvas for innovation and expansion in the dynamic Vietnamese market. International retail market players keen on capitalizing on Vietnam's retail boom should undoubtedly keep their gaze fixed on Binh Duong's vibrant landscape.
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