Q3 FMCG growth in Vietnam’s rural market hits 4-year high
The FMCG growth is driven by strong economic expansion and low inflation.
Fast-moving consumer goods (FMCG) in Vietnam’s rural market sped up in the third quarter this year, hitting a new record of 10% growth, marking the highest growth rate over the past four years, Kantar Worldpanel has said in a quarterly report.
In the long term, FMCG market growth in both 4 urban cities (Hanoi, Ho Chi Minh City, Danang and Can Tho) and rural areas shows an impressive movement, nearly twice the pace of last year, thanks to the increased volume.
In the third quarter of 2019, Vietnam’s economy continues to uphold positive readings, with robust GDP growth. Inflation remains curbed at a low level, recording the lowest 9-month average increase in the past 3 years. Retail sales of consumer goods maintain double-digit growth.
Beside the solid performance of Personal Care in both 4 urban cities and rural areas, Dairy has been also catching up in the third quarter, especially in rural areas. Beverages post a double-digit growth in the rural market, but still struggles to grow in 4 urban cities.
Together with the positive performance of Dairy, Drinking Yogurt has recovered in 4 urban cities and is accelerating growth in rural areas, mainly by winning back consumers. This category still has room to tap into in order to both expand consumer base and increase volume consumption.
Online, minimarkets & convenience stores continue leading the FMCG growth and growing in importance in 4 urban key cities. In rural areas, healthy growth is observed across all channels.
A survey conducted by Kantar on drinking habit shows that about two third of drinking occasions in a week is for bottle water, tea and coffee. Besides, unbranded juices (fruit/vegetable) is ranked fourth among non-alcoholic beverages that consumers drink every week.
In addition, the fewer occasions younger consumers drink, the more choices of non-alcoholic beverages they have.
