Many retail chains opened new stores this year even as retail sales of consumer goods and services saw a year-on-year rise of 20.5% in the first 11 months.
Despite weakening external factors, continued domestic demand brought some relief, according to a report by HSBC.
But though the pace started to slow down, retail sales remained a strong pillar of growth in November, the lender said.
Total retail sales of consumer goods and services grew by 17.5% over November 2021.
In recent months, while many factories laid off, furloughed or gave workers an early Tet (Lunar New Year holidays) service businesses such as F&B, retail and tourism expanded their operations.
GS25 Vietnam, a joint venture between South Korea’s GS25 and local retailer Son Kim Group, has opened 200 franchised stores.
Conglomerate Masan Group has bought another 34% in beverage chain Phuc Long Heritage to increase its ownership to 85%.
“The two years of the Covid pandemic can be compared to a market research period and this year is the right time to launch expansion plans as well as to make a breakthrough in the retail race,” Trang Do, head of the retail services department at property consultancy Colliers, said.
Tourism is reviving gradually, and contributing to the growth of retail services.
The number of foreign arrivals was nearly three million in the first 11 months.
Securities brokerage SSI said domestic consumption has recovered though not to pre-Covid levels, partly because of inflation.
Inflation began to accelerate at the end of the second quarter, notably with a 17% increase in housing rents in September and October, and then 2% in November. This has affected domestic consumption.
Last month headline inflation was 4.4% while core inflation was close to 5% due to a rapid recovery in demand.
According to HSBC, rising inflation is a matter of concern and would increase in the next few quarters, forcing the central bank to take monetary measures.
SSI said inflation would gradually rise in the first half of 2023, especially when the government considers adjusting prices of goods and services it manages such as electricity, healthcare and education.
Do said large retailers are very interested in the Vietnamese retail market after the pandemic. However, the biggest difficulties for foreign investors in the retail sector are to find suitable premises in terms of location and area, and carrying out investment and license procedures.
