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Belgian brewery manufacturer rouses Vietnamese enterprises from sleep

VietNamNet Bridge – The Vietnamese market is believed to become scalding hot
with the presence of the big guy from Belgium Aneuser-Busch Inbev (AB Inbev),
slated for the next year end.


Vietnam, brewery, market, population, big guys, investment

Reuters has quoted its sources as reporting that the biggest brewery
manufacturer is moving ahead with its plan to march towards Vietnam the next
year end. It plans to set up a factory there to conquer the biggest and fastest
growing market in Asia.

Nguyen Van Viet, Chair of the Vietnam Beer Alcohol Beverage Association (VBA),
has noted that the increasingly high average income and the open policy pursued
by Vietnam after its admission to WTO have paved the way for foreign brewery
manufacturers to penetrate the Vietnamese market. This has created a cutthroat
competition among the manufacturers.

“Their (AB Inbev) presence in Vietnam would make the current hot market become
hotter,” said Phan Dang Tuat, Chair of Sabeco, the manufacturer that holds the
biggest market share in Vietnam.

Another manufacturer has commented that the presence of AB Inbev would affect
everyone, and that no one can stay unconcerned with the biggest manufacturer in
the world.

“It is very likely that they (AB Inbev) would focus on competing in the high-end
and luxurious products,” he said. “Everyone, no matter they are domestic or
foreign, would be the rivals of AB Inbev.”

“I am sure that all the brewery manufacturers in Vietnam now have to strain
every nerve to work out on the plans to compete with AB Inbev, the owner of so
many well-known brands namely Budweiser, Corona, Stella Artois, Beck’s and
Brahma,” he added.

However, Viet from VBA thinks that it would be not easy for the biggest
manufacturer to succeed in Vietnam.

“Many big guys once arrived in Vietnam, but then left because they could not
develop here,” Viet said, adding that foreign groups need to take cautious steps
to penetrate the Vietnamese market, the place where it’s difficult to make fat
profit.

While Reuters quoted a senior executive of AB Inbev as saying that the brewery
manufacturer has obtained the license for land use right in Vietnam, a senior
official of the Ministry of Planning and Investment said: “The licensing has
been decentralized to local authorities. But we have not received any reports
from the localities about the project.”

However, the official said that investors sometimes try to save the time by both
applying for the investment registration certificates and asking for land use
right at the same time.

Vietnam is the third biggest beer consumer in Asia, just after Japan and China.
The Vietnamese beer consumption has increased by 200 percent over the last 10
years to 3 billion liters by 2012.

A report of Euromonitor showed that 80 percent of the Vietnamese beer market has
been controlled by three biggest manufacturers, including Sabeco, Habeco and VBL
– the owner of Heineken and Tiger brand products.

The domestic fast growing market explains why more and more foreign
manufacturers attempt to penetrate the market. Carlsberg from Denmark has
expressed its intention to increase its ownership ratio at Habeco to 30 percent
after taken over the Hue Brewery Company.

VNE

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