Meanwhile, consumption at wet markets have fallen sharply in recent years.

By the end of 2011, HCM City had 200 supermarkets, double the figure compared with 2005. In addition, the number of convenience shops had grown four times with popular names such as Shop&Go, Co.op Food, Satramart and Vissan.

Modern retail facilities, including supermarkets, trade centres, shopping malls and convenience shops, have gained 35 per cent of total retail turnover in HCM City, compared with an average of 21 per cent nationwide.

In return, traditional markets have dropped from 300 in 2005 to 200 in 2011.

The figure shows that shopping habits of local residents had moved from traditional to modern facilities.

Statistics from one market research company show that customers have increased their spending in supermarkets, from 627,000 dong in 2005 to 1.5 million dong in 2011.

"They shop at modern retail facilities because of convenience and health and to satisfy their shopping passion," a staff member from the company said.

Survey results also reveal that 80 per cent of 1,000 participants visit supermarkets every week compared to 12 per cent a decade ago.

Developing trademarks

The major factors attracting customers are convenience, stable prices due to long-term storage of commodities, ample choices and quality of goods.

Cool but large spaces and nice displays along with additional services, including home delivery, online shopping, card payments and free parking, have also attracted customers.

Supermarkets have launched promotion campaigns, attracting customers with low prices.

Several years ago, the number of commodities doubled from 30,000 to 60,000, and customers can find everything they need in supermarkets, including fresh food.

Supermarkets have reconfirmed their strength by creating their own trademarked goods.

Co.op Mart has 500 products of its own that are 5 - 10 per cent cheaper compared with the same goods.

Thanks to savings on advertisement expenditures, supermarkets can reduce the price.

Vissan, for example, has manufactured a series of new food products and ordered more new goods.

Big C has cooperated with 50 companies to produce its own products, with prices 5-30 percent cheaper than comparable products.

"Vietnam still has potential for global retailers thanks to its huge population, and big and stable consumption," Pascal Billaud, general director of Big C Vietnam, told Sai Gon Giai Phong (Liberated Sai Gon) newspaper.

"The biggest challenge for investors is not the legal framework, but the cost of renting land, which has become more and more expensive," he added.

Vietnam Investment Review - February 23, 2012