City consumers benefit hugely from sales promotion month

Consumers buy fashion products at a supermarket in HCMC. Discounts for fashion products averaged out at 22% during September - Photo: Minh Tam

HCMC – Consumers in HCMC enjoyed nearly VND300 billion, or some US$15 million, under the form of discounts during September chosen as the Big Sale Promotion Month, the city’s Department of Industry and Trade said on Wednesday.

In its overview of the sales month released on Wednesday, the department said the total promotional value amounted to VND296 billion, a hefty increase of 120% against the similar activity last year.

As many as 608 traders with 2,200 outlets participated in the sales program, increasing by 22.7% and 38% respectively. Most of the participating traders are trade centers, supermarkets, and marketplaces.

The department in its report said sharpest discounts belonged to cosmetics-fashion at an average 22%, followed by digital equipment and ICT devices at 18.5%, tourism-hotel and foods and beverages both at 16.2%, and household appliances at 15.9%.

Many traders reported sharp increases in sales during the month.

Saigon Co.op with its stores chain Co.opMart saw sales revenue increase 40% against the previous month and 50% year on year, while BigC witnessed the number of shoppers increase a staggering 110%. Other less-known supermarkets also reported agreeable growth rates, at 15-25% at Maximark, and 30% at Citimart.

Electronics centers were also big gainers in the month. Thien Hoa Electronics Shopping Centers reported an increase of 120% against August and 136% against the year-earlier period.

A highlight of this year’s sales program is the attraction of green products marketed by Unilever, Vinamilk, Colgate Palmolive, and Kido JS Company.

Revenues of these enterprises introducing green products at Saigon Co.op’s chain were said to increase by between 30% and 40% during the week-long showcase.

The Sales Promotion Month is a regular activity organized by the city’s Department of Industry and Trade in collaboration with the Department of Culture-Sports-Tourism to boost sales in September, when retail revenues often plunge. The annual activity was first organized in 2005.

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Steel trade decreases on global market

Industry insiders have reported the local steel sales dropped 41 percent in September thanks to the world market.

"September's decline was not expected. We forecast that the price of steel ingots would go through the US$600 per tonne mark but instead it dropped to US$580," said the Vietnam Steel Association's Deputy Chairman Nguyen Tien Nghi.

Steel sales in September surprised experts by dropping 41 percent over August to 283,000 tonnes.

Nghi added that due to the low price of pig iron on the world market, Vietnamese consumers are still waiting for further reductions.

Because of this, the decline has continued into the first few days of this month.

Meanwhile, he added, traders have been selling off their steel stocks.

Due to the situation, many companies and agencies have cut prices by roughly VND300,000 ($15) per tonne to stimulate the market.

According to a report by the association, the price, excluding value-added tax, is now standing at about VND13.6 million (US$697 ) per tonne.

The association said the situation would steady itself in the second half of October, as the rainy season ends and demand for construction steel picks up.

"In addition, when steel stocks are sold out, traders will be forced to renew their supplies and consumption will increase," Nghi said.

He added that demand on the world market is also increasing which would help push the price back up.

Talking about sales for the whole year, Nghi optimistically said that they would increase by 15 percent over last year.

"Because of high consumption in previous months, the dip in September will not affect sales for the whole year," he explained.

Last year, the country consumed nearly 4.2 million tonnes of steel.

Worldwide steel production may plateau over the next five years as a result of environmental pressures and smaller demand increases.

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Steel sales slip in September

Steel sales in September surprised experts by dropping 41 percent over August to 283,000 tonnes.

"September's decline was not expected. We forecast that the price of
steel ingots would go through the 600 USD per tonne mark but instead it
dropped to 580 USD," said the Vietnam Steel Association's Deputy
Chairman Nguyen Tien Nghi.

Nghi added that due to
the low price of pig iron on the world market, Vietnamese consumers are
still waiting for further reductions.

Because of this, the decline has continued into the first few days of this month.

Meanwhile, he added, traders have been selling off their steel stocks.

Due to the situation, many companies and agencies have cut prices by
roughly 300,000 VND (15 USD) per tonne to stimulate the market.

According to a report by the association, the price, excluding
value-added tax, is now standing at about 13.6 million VND (697 USD) per
tonne.

The association said the situation would
steady itself in the second half of October, as the rainy season ends
and demand for construction steel picks up.

"In
addition, when steel stocks are sold out, traders will be forced to
renew their supplies and consumption will increase," Nghi said.

He added that demand on the world market is also increasing which would help push the price back up.

Talking about sales for the whole year, Nghi optimistically said that they would increase by 15 percent over last year.

"Because of high consumption in previous months, the dip in September
will not affect sales for the whole year," he explained.

Last year, the country consumed nearly 4.2 million tonnes of steel./.

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Auto sales drop 17% in September

HCMC - Sales of locally assembled automobiles in Vietnam fell 17% year-on-year to more than 9,140 units in September, although it was up nearly 500 units from August, the Vietnam Automobile Manufacturers’ Association (VAMA) said.

VAMA reported that in September, sales of sport utility vehicles (SUV) and multi-purpose vehicles (MPV) were down 19% to about 1,980 units, while the number of passenger cars fell a staggering 21% to 2,754 units. The number of commercial vehicles sold also shrank 14% year-on-year to more than 4,400 units.

Toyota Vietnam saw a slight decrease in sales to nearly 2,630 units last month from more than 2,800 units a year ago, down 6%. However, it still led the market in sales, holding a market share of 28.8%.

Ford, Isuzu, Honda, Visuco (Suzuki), Vinastar (Mitsubishi), GM-Daewoo, Mercedes-Benz and Vinamotor all suffered a slump in sales last month. Isuzu Vietnam sold 133 units, down 46% year-on-year; Honda Vietnam just over 190 units, down 47%; Ford Vietnam 545 units, down 41%; and Mercedes-Benz Vietnam 225 units, down 18%.

However, domestic automakers, including Truong Hai and Vinacomin – Vinacoal, witnessed the sharpest sales increases in September. Truong Hai’s sales increased by 382 units, or over 21%, to 2,190 units, while the little-known automaker Vinacomin – Vinacoal saw sales climb up from 13 units to 23 units.

VAMA members sold nearly 78,180 units in the January-September period, down 3% year-on-year. The SUV/MPV vehicle segment was hardest hit with sales sliding a hefty 14% to more than 16,280 units. Toyota alone sold more than 21,600 units in the nine months.

Similarly, some 4,000 cars were imported to the country in September, worth US$90 million, according to the General Statistics Office (GSO) estimate. Compared with last month, the numbers marked a 20% decrease in volume and 2.17% decline in value.

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Auto sales drop 17% in September

HCMC - Sales of locally assembled automobiles in Vietnam fell 17% year-on-year to more than 9,140 units in September, although it was up nearly 500 units from August, the Vietnam Automobile Manufacturers’ Association (VAMA) said.

VAMA reported that in September, sales of sport utility vehicles (SUV) and multi-purpose vehicles (MPV) were down 19% to about 1,980 units, while the number of passenger cars fell a staggering 21% to 2,754 units. The number of commercial vehicles sold also shrank 14% year-on-year to more than 4,400 units.

Toyota Vietnam saw a slight decrease in sales to nearly 2,630 units last month from more than 2,800 units a year ago, down 6%. However, it still led the market in sales, holding a market share of 28.8%.

Ford, Isuzu, Honda, Visuco (Suzuki), Vinastar (Mitsubishi), GM-Daewoo, Mercedes-Benz and Vinamotor all suffered a slump in sales last month. Isuzu Vietnam sold 133 units, down 46% year-on-year; Honda Vietnam just over 190 units, down 47%; Ford Vietnam 545 units, down 41%; and Mercedes-Benz Vietnam 225 units, down 18%.

However, domestic automakers, including Truong Hai and Vinacomin – Vinacoal, witnessed the sharpest sales increases in September. Truong Hai’s sales increased by 382 units, or over 21%, to 2,190 units, while the little-known automaker Vinacomin – Vinacoal saw sales climb up from 13 units to 23 units.

VAMA members sold nearly 78,180 units in the January-September period, down 3% year-on-year. The SUV/MPV vehicle segment was hardest hit with sales sliding a hefty 14% to more than 16,280 units. Toyota alone sold more than 21,600 units in the nine months.

Similarly, some 4,000 cars were imported to the country in September, worth US$90 million, according to the General Statistics Office (GSO) estimate. Compared with last month, the numbers marked a 20% decrease in volume and 2.17% decline in value.

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Honda ranks highest in sales satisfaction in Vietnam

HCMC – Honda ranks highest in sales satisfaction in Vietnam for the second consecutive year, according to the J.D.Power Asia Pacific after a 2010 Vietnam Sales Satisfaction Index Study released on October 1.

The study examines seven sectors that contribute to overall customer satisfaction with the purchase experience. In order of importance, they are delivery process, delivery timing, sales initiation, paperwork, salesperson, dealer facility, and deal.

Sales Satisfaction Index performance is reported as an index score based on a 1,000-point scale, where a higher overall Sales Satisfaction Index score indicates greater satisfaction with the new-vehicle sales and deliver process. Overall sales satisfaction averages 841 in 2010, an improvement of 15 points from 2009.

Among the six brands included in the study, Honda ranks highest in customer satisfaction with new-vehicle sales for a second consecutive year, achieving a score of 871. Honda performs particularly well in the sales initiation, dealer facility, salesperson, paperwork, delivery timing, and delivery process factors.

Meanwhile, Toyota with a score of 858 ranks second, followed by Hyundai with 847, Ford with 832, Kia (827), and GM Daewoo (800).

“The ability of leadership personnel to provide comprehensive explanation at or after delivery, such as the recommended maintenance schedule, warranty coverage, safety features and how to operate each feature, has a considerable impact on customer satisfaction,” said Rajeev Nair, senior manager of J.D. Power Asia Pacific in Singapore.

“This is especially important for new vehicle owners. A sizable proportion of owners, 65%, indicate they are the first-time new-vehicle buyers,” he noted in a statement.

Also according to the study, “there was a surge in vehicle sales during the final months of 2009, as customers rushed to buy vehicles before registration fees increased on January 1, 2010.”

The 2010 Vietnam Sales Satisfaction Index Study is based on responses from 793 new-vehicle owners who purchased their vehicles between October 2009 and June 2010. The study was fielded between May and July 2010.

Despite higher ranking, Honda still trails Toyota Motor Vietnam in sales.

In August, Toyota Motor Vietnam sold more than 2,440 units, down from the more than 2,950 units a year ago, while Honda Vietnam sales slumped 37% to nearly 230 units, according to the Vietnam Automobile Manufacturers Association (VAMA).

August sales of locally assembled automobiles in the country fell 18% year-on-year to about 8,670 and were down 700 units compared with a month earlier,

In the January-August period, VAMA members sold nearly 68,390 units, down 1% year-on-year. Toyota alone sold more than 18,980 units in the first eight months.

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Vietnam’s first biofuel product registers good sales

PV Oil, a subsidiary of state-owned Vietnam Oil and Gas Group, said sales of its biogasoline product has nearly tripled since its official launch in August.

E5 gasoline, a blend of 5 percent ethanol and 95 percent gasoline, has been welcomed by local consumers because it is cheaper and better for the environment, said Nguyen Thi Dieu Hanh, deputy sales manager at PV Oil.

Hanh said her company is currently supplying around 25,000 liters of the ethanol gasoline to the market every day, up from 8,000-9,000 liters a day in the early days.

E5 was first launched in Vietnam in September 2008 on a trial basis, but sales were halted six days later due to administrative problems. The government issued regulations on quality management of biofuel products last year, allowing PV Oil to begin sales of E5 gasoline officially in August.

Hanh said supply is now falling short of demand because production of the gasoline is still small-scale.

“We want to study more from the response of consumers as well as wait for any support policies from the authorities," she said.

Although PV Oil said it has expanded the distribution system since August, there are now only 29 gas stations that sell the product in large cities. 

Vietnam Oil and Gas Group plans to supply 240 million liters of E5 to local consumers in 2012 at some 4,300 stations.

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Retail sales soar 25% in first nine months

Customers shop at a supermarket in the northern province of Bac Ninh. September's retail sales revenue increased 2.93 per cent against the previous month to nearly VND134.9 trillion ($6.9 billion). — VNA/VNS Photo Tran Viet

HA NOI — Total retail sales revenue of commodities and services in the first nine months of the year increased 25.4 per cent year-on-year to more than VND1,146 trillion (US$58.7 billion), according to the General Statistics Office (GSO).

September's revenue alone increased 2.93 per cent against the previous month to nearly VND134.9 trillion ($6.9 billion), the GSO said.

The trade sector reported a year-on-year revenue surge of 26.4 per cent to VND905.1 trillion ($46.4 billion), accounting for 79 per cent of the country's total sales revenue during the nine month period.

The hotel and restaurant sector saw a rise of 21.8 per cent to VND126.25 trillion ($6.47 billion). The increased figures for the tourism and service sectors were 37.4 per cent and 20.5 per cent to VND12.16 trillion ($625.6 billion) and VND102.6 trillion ($5.26 billion), respectively.

The surge's retail sales revenue was due primarily to the organisation of promotional programmes, including the Sales Promotion Month 2010 in HCM City, one of the country's largest shopping centres.

The HCM City's September programme saw the participation of nearly 600 businesses, mostly involved in garments and textiles, food and beverages, home utensils and tourism services, with roughly 2,000 sales promotion points. Roughly 1,500 products received 10-50 per cent reductions, 90 per cent of the products were high-quality Vietnamese goods.

According to the HCM City Department of Industry and Trade, sales of businesses taking part in the Sales Promotion Month increased 10-15 per cent compared to the same period last year. The number of consumers also rose sharply.

Director of the Ministry of Industry and Trade's Domestic Market Department Truong Quang Hoai Nam said foreign investors continued to consider Viet Nam a promising investment destination.

Meanwhile, global ratings agency AT Kearney predicted that Viet Nam's retail industry would grow over the next few years, and that consumer spending would rise above its current level of 70 per cent of household income.

The Ministry of Industry and Trade forecast that the country's retail sales and services revenue would soar 22 per cent from a year earlier to $78.9 billion. — VNS

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Promotion month sees hefty sales revenue

Customers inspect water melons at Big C Hoang Van Thu store. Retail outlets in HCMC have reported stronger sales since the 2010 Big Sale promotion started early this month - Photo: Minh Tam

HCMC – Supermarkets and shopping centers in HCMC have reported an upsurge in sales from last year since local government launched the 2010 month-long sales promotion early this month.

Most retailers reported revenue growth of between 20% and 100% in the first half of September while the number of shoppers was also higher. Sales revenue of Co.opMart stores leapt 30% while Zen Plaza, Vissan and Fahasa soared 100%, 23% and 20% respectively.

Retailers reported August sales rises of 5% to 20% but early this month their sales rocketed 30% to 200% depending on areas as the Big Sale program started in coincidence with the long National Day holiday.

Sales at Nguyen Kim and Thien Hoa electronics supermarkets grew 200% on September 2.

Retailers said at a meeting with the city’s Department of Industry and Trade last week that the increased publicity for the promotion had contributed to the success.

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August auto sales down 18%

HCMC – August sales of locally assembled automobiles in the country fell 18% year-on-year to about 8,670 and were down 700 units compared with a month earlier, according to the Vietnam Automobile Manufacturers Association (VAMA) on Thursday.

Last month, sales of commercial vehicles were down 12% against August of last year to just over 4,160 units while sales of sport utility vehicles (SUV) and multi-purpose vehicles (MPV) were down 22% to about 1,780 units and sales of passenger cars down 23% to 2,724 units.

Truong Hai saw an 11% year-on-year sales increase to nearly 2,054 units, and Vinaxuki sold 674 units, up 2%, but other auto makers reported sales declines of up to 85%.

Last month Hino sales plunged 85% to 36 vehicles, and GM Daewoo sold around 726 vehicles, down 48%. VinaStar (Mitsubishi) was in a similar boat, with sales dropping around 63% to 157 units.

The leading automaker in the country, Toyota Motor Vietnam (TMV), sold more than 2,440 units, down from the more than 2,950 units a year ago. Honda Vietnam sales slumped 37% to nearly 230 units and Mercedes-Benz Vietnam down 4% to nearly 220 units.

Domestic automobile manufacturers like Vinamotor and Vinacomin-Vinacoal posted hefty falls in sales in August as well.

VAMA members sold nearly 68,390 units in the January-August period, down 1% year-on-year. The SUV/MPV vehicle segment was hardest hit with sales sliding a hefty 13% to more than 14,300 units. Toyota alone sold more than 18,980 units in the first eight months.

Similarly, sales of imported cars also fell in the first months. Last month, the General Statistics Office (GSO) estimated that the number of autos imported to Vietnam was only 4,000 units, down by 9.1% over last month. The total import value was worth only US$78 million, a month-on-month decline of 18.8%.

According to market insiders, the import car market has been strongly affected by a number of new policies, economic conditions and Vietnamese beliefs that the seventh month of the lunar calendar is not lucky.

The State Bank of Vietnam’s latest exchange rate revision has been a torment to many enterprises. The imported auto segment is one of many business sectors feeling the heat.

The Government policies to limit imports are becoming effective. They focus in many areas, including customs and tax. For example, importers have to show environmental protection certificates before they can make imports. And tax arrears are not allowed. The credit tightening of banks has also limited car imports.

In previous months, the volume of imported autos was down, but the value of import turnover continued to increase.

With the continuous increase of the dollar compared with dong from early this year plus high interest rates for consumer loans, increasing VAT rates and increasing registration fees, the car consumption in 2010 will stay the same as or even lower than that of last year, automakers said.

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Not so easy for home developers

Developers of luxury apartment projects have had to shift their sales strategies in face of flagging demand, said real estate consulting and services firm Savills Vietnam.

Prior to the financial crisis, developers could sell units without much effort due to soaring demand, but they now had to turn to sales promotion programmes to turn over unit and meet sales targets, Savills said.

Indochina Land Ltd Co, developer of the Indochina Plaza Hanoi project, recently announced a trade promotion programme for customers who buy apartments in the Xuan Thuy Road complex.

The Mullberry project in Ha Dong District also has a programme in co-operation with a bank offering financing to buyers of apartment units, while the Richland Southern project has set up a preferential payment policy for customers.

Indochina Land sales manager Michael Piro also said his company often provided information to customers about the construction progress of projects, information they often expected to know before putting down a deposit.

Vu Xuan Thien, deputy head of the Ministry of Construction's real estate marketing department, said prices of the luxury apartment market were mostly stable, with prices rising for a few projects in prime locations. Luxury apartments in Hanoi were currently selling at US$2-3,000 per sq.m.

Savills predicted that real demand in the luxury apartment segment would continue to be high in the medium- to long-term due to improved living standards, rising per-capita incomes, and steady rates of population growth and urbanization.

 

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Not so easy for home developers

Developers of luxury apartment projects have had to shift their sales
strategies in face of flagging demand, said real estate consulting and
services firm Savills Vietnam.

Prior to the financial crisis, developers could sell units without much
effort due to soaring demand, but they now had to turn to sales
promotion programmes to turn over unit and meet sales targets, Savills
said.

Indochina Land Ltd Co, developer of the Indochina
Plaza Hanoi project, recently announced a trade promotion programme for
customers who buy apartments in the Xuan Thuy Road complex. The
Mullberry project in Ha Dong District also has a programme in
co-operation with a bank offering financing to buyers of apartment
units, while the Richland Southern project has set up a preferential
payment policy for customers.

Indochina Land sales
manager Michael Piro also said his company often provided information to
customers about the construction progress of projects, information they
often expected to know before putting down a deposit.

Vu
Xuan Thien, deputy head of the Ministry of Construction's real estate
marketing department, said prices of the luxury apartment market were
mostly stable, with prices rising for a few projects in prime locations.
Luxury apartments in Hanoi were currently selling at 2-3,000
USD/sq.m.

Savills predicted that real demand in the luxury
apartment segment would continue to be high in the medium- to long-term
due to improved living standards, rising per-capita incomes, and steady
rates of population growth and urbanisation./.

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Not so easy for home developers

HA NOI — Developers of luxury apartment projects have had to shift their sales strategies in face of flagging demand, said real estate consulting and services firm Savills Viet Nam.

Prior to the financial crisis, developers could sell units without much effort due to soaring demand, but they now had to turn to sales promotion programmes to turn over unit and meet sales targets, Savills said.

Indochina Land Ltd Co, developer of the Indochina Plaza Ha Noi project, recently announced a trade promotion programme for customers who buy apartments in the Xuan Thuy Road complex. The Mullberry project in Ha Dong District also has a programme in co-operation with a bank offering financing to buyers of apartment units, while the Richland Southern project has set up a preferential payment policy for customers.

Indochina Land sales manager Michael Piro also said his company often provided information to customers about the construction progress of projects, information they often expected to know before putting down a deposit.

Vu Xuan Thien, deputy head of the Ministry of Construction's real estate marketing department, said prices of the luxury apartment market were mostly stable, with prices rising for a few projects in prime locations. Luxury apartments in Ha Noi were currently selling at US$2-3,000/sq.m.

Savills predicted that real demand in the luxury apartment segment would continue to be high in the medium- to long-term due to improved living standards, rising per-capita incomes, and steady rates of population growth and urbanisation. — VNS

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