Vietnam will be the fastest-growing convenience market in Asia by 2021, predicts international grocery research organisation IGD.
According to the researcher, Asia’s grocery market will be the largest in the world with predicted 6.3 per cent of compound annual growth rate, up to US$4.8 trillion by 2021.
Of that, the convenience store sector will see double-digit compound annual growth in the next four years.
IGD predicts the Vietnam convenience store market will grow by 37.4 per cent in that time, followed by the Philippines at 24.2 per cent and Indonesia at 15.8 per cent. Those figures are based on assessments of the performance of the leading convenience store operators in each market.
During the past couple years, Vietnam convenience stores have become popular destinations, especially for young consumers. Savvy operators, like Circle K and FamilyMart have recognised local demand for c-stores as a place to not only shop but to hang out as well, providing an air-conditioned area to consume freshly-served convenience foods and snacks, up-to-date merchandising systems, a mix of imported and local goods and – in some stores – even free Wi-Fi.
It is also easier for businesses to get licences for stores with footprints under 500 sqm.
According to IGD, Vietnam, the Philippines and Indonesia share similar characteristics that make their convenience markets particularly ripe for growth, including:
Thanks to the positive economic outlooks of all three countries, consumers are shifting from traditional wet-markets to the so-called modern trade, like convenience stores and supermarkets.
Increased GDP per capita and foreign investment have also encouraged the market growth.
“Among all the brick-and-mortar grocery channels, convenience shows the strongest growth prospects in Asia, thanks to rapid urbanisation, a growing young population and greater levels of disposable income,” says Nick Miles, head of Asia-Pacific at IGD.