Vietnam retail e-commerce to earn $10 billion by 2020

Viet Nam’s potential for e-commerce development in the retail sector could achieve a US$10-billion revenue by 2020, accounting for half the country’s total retail sales.

A shopper buys goods online. E-commerce revenue is expected to reach $10 billion in the retail sector by 2020.-VNA/VNS Photo Minh Tu

Data from the Association of Viet Nam Retailers (AVR) indicates that in 2015, retail e-commerce surpassed $4.07 billion, with a growth rate of 20 per cent.

Ho Thi Kim Thoa, Deputy Minister of Industry and Trade, told a forum on e-commerce and mobile phone technologies in Ha Noi yesterday that e-commerce was a vital development trend in the retail sector.

Thoa said last year, the growth rate of the retail sector was 9.5 per cent. Traditional retail made up 80 per cent, while modern retail including supermarkets, convenience stores and e-commerce accounted for only 20 per cent. “Notably, in the modern retail channels, the portion of e-commerce was at a low level of around 2.8 per cent,” she added.

The country had 217 e-commerce trading floors with total revenues of VND1.66 trillion in 2014, double the 2013 figure.

“Vietnamese businesses have seen positive changes in e-commerce by big firms. The number of small- and medium-size enterprises (SMEs) participating in e-commerce was modest even though 97 per cent of the country’s 600,000 firms are SMEs,” she said.

The deputy minister noted that the Prime Minister had promulgated a decision on master planning of e-commerce in 2016-20.

She gave the recent Online Friday on December 2 as an optimistic example of e-commerce development. The number of enterprises joining in the event this year was 3,000, higher than last year.

She urged businesses to catch up with e-commerce trends and have plans to enhance e-commerce development.

Dinh Thi My Loan, AVR’s chairwoman, said there were many factors promoting e-commerce development, including the popularity of mobile devices.

Nguyen Thanh Hung, chairman of Viet Nam E-commerce Association (VECOM), agreed that the development of mobile phones and applications had contributed to promoting purchasing activities.

Hung said the country’s e-commerce had been developing at a growth rate of 30 per cent a year. “Businesses have quickly shifted from offline to online retail. Several are even totally doing business online,” he said.

However, Pham Thanh Cong from Nielsen said the sector should have solutions to meet demand in rural areas as there are 1.3 million traditional shops, accounting for 85 per cent of the retail sector’s revenue.

Source VNS