Hoa Binh Group believes its soda can take on industry giants in domestic market.
Four months after being launched, V-Cola, a domestically-produced soda of the Hoa Binh Group, can now be found in 50 out of Vietnam’s 63 cities and provinces. Mr. Nguyen Huu Duong, Chairman of Hoa Binh, aims to call on customers to buy domestic products and compete with major beverage brands throughout the country.
“V-Cola costs VND5,700 a can, or just 70 per cent of the price for similar products made by foreign companies,” Mr. Cuong said. “V-Cola's competitors were forced to cut their prices by VND850 five days after its launch.” Given they sell VND1.15 billion cans annually, the lower price cost them in the vicinity of VND1.44 trillion ($66.24 million) a year, he added.
In January the Hoa Binh Group launched three new product lines: V-Cola, the energy drinks Fansipan Gold and Fansipan Red, and the sports drink Sport 5.
Mr. Duong first planned to enter the beverage market way back in 1994. When the US embargo on Vietnam was removed in the same year, however, Coca-Cola was quick to enter the market. He realized he could not compete with such a famous international brand so shelved his plans, despite having made a $15,000 down payment on a production line and beginning construction of a factory.
“It was the right move to make back then,” he said. “We were unable to take on such a strong multinational corporation.” Twenty years later, though, he now plans to compete with them head on.