Vietnam is one of the most attractive markets in South East Asia for consumer-oriented organisations due to its sustainable economic growth and low inflation levels, which will strongly benefit consumers' spending power over the next five years. Positive demographic dynamics and increasing income will also attract retailers interested in capturing the mass-market segment. With 60 per cent of the local population aged 30 years old, of which about 6.1 million households are estimated to enter the US$ 5,000-US$ 10,000 income level towards 2020.

Vietnam’s food sector accounts for a substantial and growing part of the country’s gross domestic product (GDP). Total food sales are forecast to increase at a compound annual average rate of 11.3 per cent over 2017-2021. Per capital food sales will experience the growth of 10.3 per cent per annum during 2017-2021, along with strong population growth. Bread, rice and cereals continue to account for more than 40 per cent of total food sales in the country and dairy products will outperform over the next five years.

According to the Association of Vietnam Retailers, the country currently has around 800 supermarkets, 150 shopping centers, 9,000 traditional markets and 2.2 million mom-pop stores.

Foreign retail giants have also shown their interest in developing modern retailing in Vietnam by investing into trade centers and supermarkets. Foreign retailers are leading the change from traditional to modern retailing. The growth of modern retailers presents opportunities for greater exposure to imported products.



Given the French influence in Vietnam’s history, dairy products are well received and are associated with healthy diets. With higher disposable income, rising health consciousness, new consumption patterns and a growing customer base underpins strong growth in the sector.

Milk consumption will continue to increase over the next few years due to rising incomes and the development of modern chain stores however local production is limited and cannot meet domestic demand. Vietnam relies on imported raw material to meet the shortage of supply. 70 per cent of raw materials are imported from New Zealand, USA, EU and Australia.


Beer accounts for 94 per cent of alcoholic beverage consumption in Vietnam. In 2016, Vietnam consumed 3.78 billion litres of beer, up 9.3 per cent in 2015, 380 million litres of wine and spirits, and 5.5 billion litres of non-alcoholic drinks. Vietnam ranks first place in Southeast Asia for beer consumption.

Towards 2021, annual production of beer, wine and spirits, and non-alcoholic drinks will rise to 5.3 billion litres, 250 million litres, and 8.3 billion litres.

The wine imports in Vietnam increased at a stable rate of 10 per cent annually from 2010 till now with an average consumption of 250ml per person per year (Source: Vietnam General Statistics Office). French brands holds 35 per cent market share, Chilean brands 25 per cent, and the rest comes from Italy, Spain, USA, and Australia.

Processed food

Processed food and beverages are one of the key industries of Vietnam, contributing to 37 per cent of GDP. The consumption of imported products grows at a low level in Vietnam, mainly at big cities like Hanoi and Ho Chi Minh City. Overall, the country’s food processing industry is disjointed and ruled by relatively small domestic businesses. With the recent investment by foreign consumer goods investors, the industry is expected to become more competitive.

Vietnam’s economy growth, increasing incomes, favourable demographics, rising health awareness and growing investments in the industry will encourage demands for confectionery, especially baked goods. Over recent years, consumption for baked goods has also been growing. Local consumers’ appetite has continued to change and is more accepting of Westernised baked goods like bread, cookies, and cakes.

The domestic pasta market is still underdeveloped although in view of more westernised lifestyle, pasta is more accepted by consumers in urban areas. Meanwhile, the market for instant noodles is well developed with dominating brand names owned by local companies, and some imported products from Korea, Japan, and Thailand.

Also under the influence of western gastronomy, cheese is also becoming popular for Vietnamese consumers. Cheese records retail volume and value growth of 8 per cent and 10 per cent respectively in 2017, reaching 6,871 tonnes and VND 1.7 trillion in 2017. Trends from food service has affected retail cheese positively in 2017.