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Q3 beverage growth leads in FMCG

Released at: 10:41, 07/12/2017

Q3 beverage growth leads in FMCG

Photo: Duc Thanh

Nationwide growth in FMCG bounced back in third quarter after dipping in previous quarter, according to latest Nielsen report.

by Nghi Do

Nationwide growth in fast-moving consumer goods (FMCG) came in at 6.4 per cent year-on-year in the third quarter, primarily due to an increase of 5.8 per cent in volume, according to the Nielsen Quarterly Market Pulse report released by Nielsen Vietnam.

When looking deeper into the six super FMCG categories nationwide, beverages recorded the highest increase, with growth of 8.5 per cent, led by an increase of 6.4 per cent in volume. Cigarettes also recorded solid growth, of 5.9 per cent. Other super categories, meanwhile, showed some level of stagnation.

The Market Pulse Report is based on the results of the Nielsen Retail Measurement study of FMCG, which provides continuous tracking of product movement through defined retail outlets. The data is used to measure manufacturer and retailer efforts as well as consumer off-take.

The report also shows that rural areas continue to have major potential for many manufacturers. While beverage growth in urban areas was 4.7 per cent year-on-year, growth in rural areas was 7.6 per cent, led by 7.4 per cent volume growth and contributing 54 per cent to total FMCG sales. 

“On the heels of improving consumer confidence in the quarter, Vietnam’s GDP grew 6.9 per cent in the first nine months of the year,” said Mr. Nguyen Anh Dzung, Director of Retail Measurement Services at Nielsen Vietnam. “This momentum was enhanced by consumers’ optimistic perception of personal finance along with their willingness to spend. Despite the rise in GDP this year, Vietnam’s FMCG market has fluctuated over the past two years. The volatility reflected in super categories poses a lot of challenges for manufacturers to make sound decisions to fully seize the market growth opportunities and drive a profitable business.”

“Rural Vietnam, however, remains a high-potential opportunity for many manufacturers,” he went on. “And in rural, the traditional trade channel, a complex and highly competitive channel, is still where most sales are taking place. Getting products to each and every retailer in rural to expand distribution to drive more sales has long thought be to a challenging game for manufacturers. Therefore, store segmentation, or ‘where to focus’, is what businesses should go after whenever they think about expanding to this new potential market. As the rural Vietnamese community continues to evolve, transform, and take center stage as a key group for businesses, understanding who they really are, where, how, and what they are buying, and what their most effective touch points are will be prerequisites for future success.”

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