Cooperating with more than 100,000 affiliated grocery stores in 22 provinces and cities and providing 2,000 FMCG products via its mobile app, VinShop is the largest FMCG distributor, via its grocery store digital transformation platform, in the country.
As reported, by the end of the first quarter of 2022, VinShop (a technology product of One Mount Group) is acting as a mobile app-based goods importing platform for more than 100,000 traditional grocery stores in Viet Nam - serving 40,000 more grocery stores than the second-ranked app.
Since its official market launch in October 2020, there are an average of more than 200 small shopkeepers every day who choose VinShop for "technology upgrade" and to take advantage of technology and financial solutions to increase their income.
VinShop achieved an impressive growth rate after more than 1 year of its official market launch.
Apart from its wide coverage, VinShop once achieved a monthly growth rate of 49 per cent Gross Merchandise Value and a monthly increase of 51 per cent of the average order value of small shopkeepers.
The VinShop warehouse system with 25,000 m2 of central warehouses and 10,000 m2 of satellite warehouses is built across 20 cities and provinces.
This, in combination with its transportation system, which handles over 1,000 tons of goods daily with a vehicle occupancy rate of up to 98 per cent, enables grocers to order multiple items and receive them at one time - instead of goods imported by the traditional method where a carrier transports each item.
At the beginning of the second quarter of 2022, VinShop continuously opened its branches in seven new markets, including Quang Ninh (North Region), Thanh Hoa and Nghe An (Central Region), and four provinces of An Giang, Dong Thap, Tien Giang and Vinh Long (West Region).
After 1 month of market entry, VinShop has made a strong impression by cooperating with more than 5,000 grocery stores and partnering with dozens of distributors to ensure stock, warehousing, and delivery for each grocery store.
Its revenue from seven new markets in May 2022 increased by more than 30 per cent compared to April 2022.
VinShop offers many technology tools and financial solutions to help grocery stores increase income.
Even though VinShop is not the only platform in the race to digitize the traditional retail model, VinShop’s ability to understand customers, in addition to its solid technology and financial background, is considered by experts as the main advantages that enable its grocery store digital transformation to become popular in each neighbourhood and corner in Viet Nam.
Tech In Asia, the largest English language technology media focusing on Asia, once called VinShop the "Goliath" of the Vietnamese retail market.
Meanwhile, Nikkei Asia assessed that VinShop is bringing about drastic changes, with the biggest motivation being to boost grocery stores’ monthly income by 10 million Vietnamese dong.
Two important reasons that motivate VinShop to enter the billion-dollar market
Despite its spectacular growth rate, VinShop still has many favourable conditions to expand its influence with the first business-to-business-to-consumer (B2B2C) model in the country.
Firstly, the retail market is still growing strongly with such a great volume and is expected to reach a total sales of 100 billion USD by 2025. According to Nielsen data, Viet Nam has about 1.4 million grocery stores and 9,000 traditional markets, accounting for 75 per cent of the market share.
These grocery stores and traditional markets are meeting up to 85 per cent of Vietnamese people's demands and help deliver about 88 per cent of FMCG products to customers, the highest rate in the region, according to RedSeer Consulting.
“In addition to being widely popular, close and accessible, grocery stores are a potential touchpoint that enables VinShop to expand its business model,” said a representative of One Mount.
VinShop can help traditional grocery stores have the same conveniences as modern supermarkets.
Secondly, about 61.3 million Vietnamese people are using smartphones, making Viet Nam one of the 10 countries with the highest number of smartphones globally, as reported in 2021 by Statista.
A young population with rapid digital transformation and fast technology update capacities makes it easier for VinShop to change customers' habits and behaviours.
“Together with VinID, Viet Nam's No. 1 loyalty platform, One Mount’s B2B2C model brings value and increases income for all participants in the supply chain from the manufacturers, distributors, grocery storekeepers, to the end consumers,” he added.
The digitization trend and the open market are important to push for VinShop to expand its market.
Taking advantage of technology and data from One Mount and financial solutions from its strategic partner, Techcombank, VinShop is holding a great opportunity to transform the traditional retail model and optimize operations to increase income.
Once 1.4 million grocery stores can optimise their operation and increase their income, their lives and the surrounding community will become better. This will be a future worth waiting for, with the contribution of such pioneers as VinShop.