New chain has lower prices than MWG’s thegioididong.com chain.
The Mobile World Investment Corporation (MWG) launched a chain of ten Dien Thoai Sieu Re stores (dienthoaiSIEURE.com) on September 3, with the first being in Go Vap district, Ho Chi Minh City, marking an important new step for the retailer.
Mr. Doan Van Hieu Em, CEO of MWG, said that average revenue of Dien Thoai Sieu Re stores during the pilot period starting at the beginning of August was about VND12-15 million ($520-$645) per day. “The figure is estimated to increase strongly when the operational system is completed,” he added.
The new chain has lower prices than MWG’s thegioididong.com (TGDD) chain, by about 10 per cent, and will compete with small mobile phone stores. The Go Vap store covers about 15-20 sq m and sells mobile phones at prices of less than VND8 million ($345). To enable lower prices, the store will cut five-star services offered by thegioididong.com, such as using products before purchase and changing to another product within 30 days. Each store will have one consultant and no wi-fi and no support on product warranty.
Mr. Hieu Em said the new model focuses on customers the retailer has never served. These customers wish to own authentic products at an affordable price and are not focused on added value services thegioididong.com provides. “We will continue to complete the new business model to make it suitable with our targeted customers, as well as measure efficiency before deciding to expand the chain on a large scale,” he said.
As at the end of July, MWG was operating a total of 2,530 stores, an increase of 69 compared to the end of June. The Dien may Xanh (DMX) chain added 27 new stores, including upgrades, while the Bach hoa Xanh (BHX) chain added 59 new stores, bringing its total to 659.
In the first seven months of this year, MWG recorded consolidated net revenue of VND60.93 trillion ($2.62 billion), up 18 per cent compared to the same period last year, while net profit was VND2.41 trillion ($103.8 million), up 37 per cent. Year-to-date, MWG has fulfilled 56 per cent of revenue targets and 68 per cent of profit targets for FY2019.
The online segment contributed 14 per cent of MWG’s total revenue, up 29 per cent year-on-year. The company has continued to avoid price differences of products online vs. offline, to optimize the omni-channel retail model, focusing on serving customers who seek convenience and service quality at TGDD and DMX stores, as well as through the thegioididong.com and dienmayxanh.com websites.
Source: Vneconomictimes