Retailer targets major expansion by turn of the decade.
When sharing the company’s plans from now to 2020 with VET, Mr. Yoo Byung Soo, Director of HR and Administration at Lotte Mart Vietnam, said it targets having 60 supermarkets throughout the country by the start of the next decade.
This is part of Lotte Mart’s strategy to become the leading retailer in Vietnam. According to Mr. Soo, the main strategy is marketing, with Vietnamese consumers to be able to recognize the brand quickly, which will bridge the gap in price competition. Capturing the tastes of customers is also another aim of Lotte Mart, which can be quite varied, even more so than in advanced countries.
While Vietnam’s retail market is still young and the tastes of customers continually change, Lotte Mart Vietnam will expand its business. Mr. Soo said that despite the tough competition, Vietnam’s retail market is full of potential. Firstly, from May 1 the market will be fully opened up under Vietnam’s commitments in international integration, which will result in many changes being seen.
Secondly, Vietnam has a young population that can be customers not only of Lotte but also other companies that may invest in the country. The country’s middle class is also expected grow from 8 million now to 44 million by 2020.
As a result, the sooner investments are made the more opportunities that will come. “It’s not easy to fully understand Vietnam’s retail market and its consumption culture,” Mr. Soo added. “This can take from five to ten years.”
He also believed, however, that if many enterprises land in the market in the near future, Lotte Mart will have to face many difficulties relating to infrastructure, human resources, and investment capital. He suggested that, due to the tough competition, the market may split into retail provided by, for example, domestic enterprises, foreign enterprises, or joint ventures. Domestic enterprises, therefore, must have the financial resources and management skills to deal with the competition.
- Lotte Mart