New Market Study, "Vietnam Food & Drink Report Q4 2012", Has Been Published

New Food research report from Business Monitor International is now available from Fast Market Research

by Bill Thompson

(WireNews+Co) - Boston, MA - 23 October 2012

Our near-term consumer outlook for Vietnam is looking increasingly worrying. Growing uncertainties over unemployment in the manufacturing sector, and concerns of a macroeconomic slowdown are already taking their toll on consumer confidence. With consumers remaining largely cautious with their spending in the coming months, 2012 is likely to serve up greater demand challenges for producers and retailers. While the current environment poses a threat to near-term domestic demand conditions, the long-term potential of the consumer-facing sectors in Vietnam is undeniable. Rapid economic growth in Vietnam over the coming years should translate into higher income, in turn benefiting consumerism.

Headline Industry Data (local currency)

- 2012 food consumption growth = +8.4%; forecast compound annual growth rate (CAGR) to 2016 = +9.1%
- 2012 alcoholic drink value sales = +15.7%; CAGR to 2016 = +14.0%
- 2012 soft drink value sales = +19.1%; CAGR to 2016 = +14.5%
- 2012 mass grocery retail sales = +12.1%; CAGR to 2016 = +12.3%

View Full Report Details and Table of Contents (http://www.fastmr.com/prod/456384_vietnam_food_drink_report_q4_2012.aspx) (http://www.fastmr.com/prod/456384_vietnam_food_drink_report_q4_2012.aspx)

Key Industry Trends

Metro Moving Forward In Vietnam: Germany-based cash-and-carry retailer Metro Group needs a lot more work in ramping up its exposure in emerging markets (EMs), which present much more exciting opportunities than its developed European markets. Vietnam, in particular, remains an attractive market for Metro, and its EM ambitions should support the expansionary plans of its local subsidiary Metro Cash & Carry Vietnam. However, the fact that Metro Cash & Carry Vietnam is present only in the wholesale sector means it faces a major threat of declining sales opportunities from the ongoing proliferation of organised retail. This raises questions about its future strategic direction in the country, although we stress that this remains a long-term play.

SMB Eyeing Regional Growth: Philippine brewer San Miguel Brewery (SMB) has its sights set firmly on the demand potential in the markets of Cambodia, Laos and Vietnam. The brewer plans to set up three new breweries in these countries with a planned investment of around US$300mn. While the Philippine beer sector will remain a strong revenue contributor for SMB, at least in the near future, the relative maturity of the market and SMB's market dominance mean that there is realistically limited scope for growth domestically over the longer term. Acknowledging the need to look afield for more exciting opportunities, SMB plans to set up brewing facilities in Cambodia, Laos and Vietnam, with a brewing capacity of 500,000 hectolitres each.

Key Risks To Outlook

Downside risks to our economic outlook for Vietnam, which include sovereign debt concerns in the eurozone and economic uncertainties in the US and China, have escalated significantly in recent months. Weak economic momentum could weigh on consumer sentiment and domestic demand growth.

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