Ready to expand supply

Vietnam continues to be an ideal destination for many global corporations and businesses in their diversification strategy, ensuring sustainable supply.

Sharing at the seminar: “Participation of distribution corporations and international purchasing contacts at Vietnam International Sourcing 2024” organized by the Department of European - American Markets, Ministry of Industry and Trade on the morning of April 12 in Ho Chi Minh City, Mr. Yuichiro Shiotani, Director of Aeon Topvalu Vietnam said that Vietnam is the chosen country and has the potential to supply goods to Aeon.

In 2023, the group invited many buyers from China, Cambodia, Hong Kong, and exported many items such as: Bananas, lychees, dragon fruit, catfish in large quantities and were loved by consumers.

“This year, businesses will focus on garment, household, and food groups with great potential, which will also receive a lot of investment. Agricultural products such as bananas and fresh mangoes will be purchased 100% by Aeon from Vietnam instead of Thailand and the Philippines as before. Output is expected to double compared to 2023,”  said Mr. Yuichiro Shiotani.

With a large distribution system in the Middle East and Malaysia, Mr. Mirash Basheer, Director of May Exports Vietnam Company, Lulu Group also hopes that through this year's event, the business will be able to connect with many suppliers and many new products from Vietnam.

According to Mr. Mirash Basheer, in the Vietnamese market, the unit has worked and found sources of goods for export to the Middle East. Sharing about the successes at Viet Nam International Sourcing 2023, Mr. Mirash Basheer said that after the event, the company found sources of goods and exported to the Indian market. Compared to 2022, in 2023, the unit's export turnover increased by 15%.

“Participating in Vietnam International Sourcing 2024, the company has mobilized purchasing teams from Dubai, Oman, and Kuwait. Hopefully, the purchasing will continue to go smoothly. In addition, we have a number of items we want to purchase in Vietnam such as: Bananas, coffee... in Vietnam”,  Mr. Mirash Basheer shared.

Assessing the success of Sourcing Fair 2023, Ms. Nguyen Hoang Thuy, Vietnam Trade Counselor in Sweden (Ministry of Industry and Trade) acknowledged that this was a successful event, helping to connect Vietnamese manufacturing and exporting enterprises with import and distribution enterprises abroad in general and the Nordic region in particular. Through this event, Nordic enterprises had the opportunity to learn more about the Vietnamese market and the potential for cooperation in various fields, from logistics to manufacturing.

“Large corporations in the field of furniture and household goods such as FH (Denmark), IKEA (Sweden), or leading Asian food import enterprises such as Scanesia (Norway), East Asia (Sweden)… when participating in the fair have more or less had a more positive view of the Vietnamese market in general and Vietnamese exports in particular. A number of contracts were signed right after the fair. Many new products were introduced to the market from frozen Vietnamese bread to shredded green papaya…”,  Ms. Thuy informed.

With this year's event connecting goods to the supply chain, Ms. Thuy said, the Trade Office will enhance the effectiveness of connections between businesses by organizing seminars, meetings with potential partners on a large scale, and organizing visits to factories and export production facilities. These activities will help create opportunities for direct exchange and build trustworthy relationships between businesses.

Problem for Vietnamese suppliers

According to experts, the series of events connecting international supply chains is an important trade promotion activity, effectively supporting Vietnamese enterprises to participate more deeply in the global production and supply chain.

However, to seize opportunities and get more orders from global buyers, businesses must constantly "upgrade" their supply capacity, produce green products, and recycle products.

According to information from the Organizing Committee, foreign enterprises are interested in Vietnam's strong products such as: Agricultural products, processed foods, forestry products, and industrial products - manufacturing...

Sufficient production capacity, stable product quality, and competitive prices are the first standards that global buyers require. However, Vietnamese enterprises must now meet additional standards for green, clean products, and production processes that reduce emissions, save energy, raw materials, and have waste recycling solutions.

Regarding these standards, Mr. Yuichiro Shiotani, Director of Aeon Topvalu Vietnam, said that in its strategy, the company is focusing on and selecting suppliers who tend to develop green production. For example, with banana products, the company will select suppliers who produce low emissions into the environment, or coffee products from businesses that ensure fair trade at the purchasing location.

Regarding the US market, a representative of the Walmart supermarket system said that there are currently about 500 businesses supplying goods to supermarkets. However, most of them are FDI enterprises, while purely Vietnamese enterprises account for a very small proportion and are mainly secondary suppliers.

According to this representative, although having enough capacity to supply Walmart, Vietnamese enterprises have encountered certain difficulties in accessing the US market. In particular, the main challenges are in finding market information and meeting market requirements.  "Currently, the amount of Vietnamese goods in Walmart supermarkets is not small, but most of them are through third-party enterprises ," this representative informed, and said that Vietnamese enterprises need to be more proactive in finding information and meeting market requirements.

Meanwhile, Mr. Do Ngoc Hung, Vietnam Trade Counselor in the US (Ministry of Industry and Trade) said that systems such as Walmart, Cotsco, and Amazon all focus on consumers and are strict about the quality and price of goods. Especially controlling input quality, ensuring green criteria, responsibility for the environment, and labor.

To expand exports to the US market, Mr. Hung recommends: Enterprises and industry associations need to pay attention to the standards of distribution systems. In the US market, the US distribution system is highly specialized, so selling directly to consumers is very difficult. Therefore, enterprises need to successfully build a supply chain from wholesale to retail. Along with that, it is necessary to have a strategy for each product, develop distribution channels on e-commerce platforms and intermediary channels. In addition, enterprises can coordinate with industry associations in states, distributors, and promotion agencies to participate in exhibitions, fairs, and expand connections...

To prepare for Vietnam Sourcing 2024, Mr. Hung said that the Trade Office is currently working closely with US corporations and Vietnamese export enterprises. Thereby promoting and bringing Vietnamese goods into US distribution systems.

Thuy Linh