Japanese retailers are expanding their businesses in Vietnam despite the ongoing economic challenges.
Targeting consumers who remain largely unaffected by the difficult economic situation, retailers such as Uniqlo and MUJI are opening more stores in the country, local media reported.
Uniqlo, which has already established 15 stores in Vietnam since entering the market three years ago, announced plans to open a new store in the southern province of Binh Duong. Meanwhile, MUJI has opened a 2,000-square meter store in HCMC’s Thu Duc City, which sells everything from home appliances to clothing, furniture, and accessories.
The Japanese retailers are doing well because high-income earners in Vietnam are largely recession-proof.
According to a recent business survey by the Japan External Trade Promotion Organization, 100% of Japanese retail businesses in Vietnam expect profits to increase this year, with 80% saying they plan to expand in the next one to two years.
MUJI’s sales have remained strong due to its stationery, cosmetics, and furniture, which are popular among young consumers. Japanese retailers in Vietnam also sell online shopping support for locally-made products.
Uniqlo has started selling Vietnamese agricultural products online, while MUJI has steadily increased the local content rate and looked for local suppliers.
MUJI’s expansion into Vietnam has been strategic. The retailer has discovered that the Vietnamese stationery market only had popular and high-end segments and not the mid-range one.
As a result, MUJI has started selling ballpoint pens for VND19,000 ($0.8), attracting students who like Japanese goods with minimalist designs. MUJI’s stores in Vietnam are the largest anywhere, at around 2,000 square meters on average, and it plans to open more stores in Hanoi later this year.
Despite the challenges of economic distress, Japanese retailers in Vietnam are confident about their future prospects. As Tetsuya Nagaiwa, the general director of MUJI Vietnam, said, “We see strong demand for high-value products.”