Bringing Vietnamese goods to Japanese supermarkets

Vietnamese lychee stall at AEON Kagoshima supermarket chain. Photo: CTV

The door is opening widely

Mr. Tran Phu Lu, Director of Ho Chi Minh City Investment and Trade Promotion (ITPC), said that Japan had been Vietnam's leading economic and trade partner for many years. Trade exchange between Vietnam and Japan has been relatively balanced, and sustainable and has grown steadily in recent times. Bilateral trade turnover in 2022 reached nearly US$ 50 billion. Of which, Vietnam exported US$ 24.2 billion to Japan and imported US$ 23.4 billion from Japan. Currently, Japan is the 4th largest trade partner and the 3rd largest export partner of Vietnam. In the first eight months of 2023 alone, Vietnam - Japan import-export turnover was estimated to reach US$ 29.1 billion.

Many goods of Vietnamese enterprises are increasingly "covered" in modern distribution systems in Japan. Vietnamese enterprises have developed quite well the method of exporting goods through large supermarkets investing in Vietnam.

According to the Department of Trade Promotion - Ministry of Industry and Trade, Vietnam is exporting a variety of products to Japan, including processed and manufactured products. Notably, a number of Vietnamese products have successfully penetrated the distribution chain in Japan. such as: coconut water, coconut milk... Vietnam goods have been imported and distributed by KOME Company to a chain of Vietnamese stores in Tokyo and neighbouring provinces, and Vietnamese coffee has been imported and sold at supermarket chains. popular market in Tokyo.

Notably, in an effort to bring Vietnamese goods to foreign supermarkets, "Vietnamese Business Products Exhibition Week and Vietnamese Business Connection Conference bringing goods to AEON supermarket chain in 2023" is a series of annual trade promotion activities to create opportunities to promote cooperation between AEON Group - one of the largest Japanese retail trade groups in the world and Vietnamese enterprises that produce quality standard products, ensuring food safety and hygiene and having a reputable brand.

This is one of the programs considered highly effective, aiming to bring the export turnover of Vietnamese goods into the AEON system to US$ 1 billion by 2025. Throughout the week, many types of products meeting the standards have been imported by AEON and consumed at hundreds of supermarkets in the AEON system.

According to AEON Topvalu Vietnam Co., Ltd. (part of AEON Group), in 2018, garment products accounted for 60%, and household products accounted for 30% of the total products AEON Topvalu Vietnam exported. By now, the export rate of food products has increased to about 40% and aims to reach 60% in the near future.

Meeting the conditions of the difficult market

Mr. Pham Binh An, Deputy Director of the Development Research Institute of Ho Chi Minh City, informed that in recent years, Japan's import standards have become increasingly strict. In the agricultural and aquatic products industry alone, in the past 5 years, the number of exported Vietnamese shipments to Japan which had been returned had nearly doubled, from 54 cases in 2018 to 90 cases in 2022. Not only agricultural and aquatic products were facing difficulties, but The textile industry also had to constantly face challenges when not only these products were durable, beautiful and diverse in design, but they also had to meet environmentally friendly standards.

Standards are strict, enterprises lack information about market demand, marketing methods, and competitors... so exports to the Japanese market are limit ed. In addition, enterprises have not effectively exploited distribution channels and their management ability is still weak.

From many years of experience in doing business and connecting the export of Vietnamese goods to Japan, Mr. Dinh Vinh Cuong, Chairman of 365 Group, said that Vietnamese goods were very popular with Japanese consumers. In particular, in addition to agricultural products, famous Vietnamese dishes such as “phở”, and bread... also win the hearts of Japanese customers. Many Vietnamese restaurants were present in major cities in Japan.

However, according to Mr. Cuong, the requirements for product quality, food hygiene and safety for Japanese imported goods were very high, posing a big challenge for Vietnamese enterprises. The current obstacle was that most Vietnamese export enterprises did not clearly understand the Japanese market and consumer culture. In addition to product quality, packaging was also one of the very important factors, but many enterprises did not understand it. Therefore, Vietnamese enterprises need to have a broader vision when working with Japanese partners, especially since they have to become honest and properly implement contractual commitments.

Mr. Keigo Yoshida, Senior Director in charge of the product department of Aeon Topvalu Vietnam Co., Ltd., Vice Chairman of the Japanese Business Association in Ho Chi Minh City (JCCH) noted that agricultural products required freshness, therefore, transportation was very important. This was the thing that Vietnamese enterprises needed to keep in mind when exporting goods to Japan to bring high value to exported goods.

In addition, Vietnamese enterprises have to compete on price with similar Chinese products in the Japanese market. While Chinese enterprises have extensive experience in producing low-cost consumer goods, most Vietnamese enterprises have only invested in factories for a short time, have high asset depreciation rates, and have few advantages in terms of human resources, so the prices are higher.