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Taiwan's TTL to launch three beers in Vietnam

Released at: 11:17, 31/07/2017

Taiwan's TTL to launch three beers in Vietnam

Photo source: baomoi.com

Taiwan Tobacco & Liquor Corp. to join Vietnam's vibrant beer market in October.

by Quang Huy

The Taiwan Tobacco & Liquor Corp. (TTL) is the latest contender joining Vietnam’s dynamic beer market, as it seeks to expand into Southeast Asia in line with the Taiwan’s New Southbound Policy.

“We are accelerating our pace to expand our reach in Southeast Asia,” TTL Vice President Mr. Chang Lei-min told the media after the opening ceremony of the Taiwan Expo in Ho Chi Minh City last week.

The company will choose a local distribution agent early next month and begin product shipments to Vietnam in early October, he said, adding that to differentiate itself from existing competitors, it will introduce three products: Golden Medal Taiwan Beer, Taiwan Beer Sweet Touch, and its pineapple flavored beer.

“We have not seen fruit-flavored beer in Vietnam,” Mr. Chang said. “This is an opportunity for us to grow in the market.” The entry into Vietnam follows the company’s penetration into the Philippines in January and Singapore in 2011. 

TTL will gradually increase its product portfolio in Vietnam and aims at a 1 per cent share of the market within three years. It will position itself as a rival of Heineken and Budweiser by selling its products at similar prices, of between $1 and $1.15 a can, Mr. Chang added.

To reduce costs and save on taxes, TTL plans to outsource production to a local brewery next year at the earliest and is also considering setting up a local brewery in the longer term.

As Vietnam is part of the ASEAN Free Trade Area, TTL plans to establish a subsidiary in the country next year to be able to export its products tariff-free to other ASEAN members, company President Mr. Tseng Chun-kai said in May.

An expanding middle class and youthful population helped drive a 300 per cent surge in beer demand in Vietnam since 2002, according to market researchers Euromonitor International, which estimates the market was worth VND147.2 trillion ($6.5 billion) in 2016. It predicts that per-capita consumption will reach 40.6 liters this year, making Vietnam the biggest consumer of the amber fluid in Southeast Asia.

Given the country’s appeal, international and domestic beer companies are vying for a stronger presence in Vietnam, which is set to be the next key battleground for international brewers as the government’s plan to dispose of brewery assets will leave the door wide open to foreign rivals, Euromonitor said in a report earlier this month.

“There aren’t many markets left that have the growth potential Vietnam has,” said Mr. John Ditty, Managing Partner of KPMG Vietnam’s Deals Advisory Unit. 

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