The Hanoitimes - The group aims to increase market share in Vietnam to more than 50% in the next five years.
TCP Group, a Thai maker and distributor of food and beverages including energy drink Red Bull, has plans to invest over US$120 million in Vietnam in the next three years to boost its marketing capabilities, Thai media reported.
Earlier this year, the group opened its first wholly-owned overseas office in Vietnam “TCPVN Company Limited”, and plans to invest heavily in market research, sales, product development and distribution capabilities.
The company owns several brands of energy drinks, including Krating Daeng (Red Bull), Som Plus, Sponsor, Puriku, as well as “Warrior”, its latest product geared for the Vietnamese market.
TCP Group is the first foreign company in Vietnam to hold full ownership of its business, Saravoot Yoovidhya, TCP Group’s CEO, told Thailand’s The Nation.
The opening of the office in Vietnam is part of the group’s five-year plan announced in 2017 to triple its total sales to over US$3 billion annually, said Yoovidhya.
According to the group’s CEO, the reasons Vietnam was chosen as the location of its first overseas office were the lifestyle of the Vietnamese and the country’s economic potential.
Moreover, Vietnamese consume energy beverages on a more regular basis than Thais.
This means that the consumption rate of energy beverages is much higher in Vietnam than in Thailand. Moreover, the company’s products are not required to carry warning on over-consumption here, as opposed to Thailand where the company faces this regulatory challenge, he explained further.
The high consumption rate also means that the energy drink market in Vietnam is highly competitive, he said.
Yoovidhya revealed that TCP’s energy beverage brands have a combined market share of up to 42% in Vietnam and expects total sales revenue in the country to reach US$302 million by the end of this year.
He said the group aims to increase market share in Vietnam to more than 50% in the next five years.
Additionally, it is a commonly known fact that Vietnam is one of the fastest growing economies in the ASEAN region as well as in the Asia Pacific. This is reflected in the group’s sales, which have been growing by 25% annually in the past three years, he said.
Vietnam’s gross domestic product (GDP) was US$223.9 billion last year, and is estimated to grow by up to 6.8% in 2018. The energy drink market in Vietnam has a total market value of US$756.53 million with a growth rate of up to 6%.