Producers feel worried; distributors keep optimistic about Tet sale season

The production season for the 2012 Tet sale has begun. While producers feel pessimistic, distributors keep optimistic about the purchasing power in the season.

No growth means “good”

Tran Kien Quoc, Director of Quang Hung private enterprise in Soc Trang province, which specializes in making sweeties, felt sad when reviewing the mid-autumn sale season.

The purchasing power was much lower than expected, which made the sale go very slowly. The input material prices have been increasing since 2010, while the demand remains low due to the high inflation.

Quang Hung plans to start the production season for Tet sale in early October. Quoc hopes that the Tet sales would account for 65-70 percent of the total sales of the year, about 20 tons of Chinese sausage and 30 tons of sweeties of different kinds. If so, the 2012 Tet sales would be equal to that of 2011 Tet, and this would be high enough to make Quoc satisfied, because he understands well that he should not put too much hope on the Tet sales, when people have to tighten their belt.

General Director of Vinamit, Nguyen Lam Vien, said that he cannot predict the demand in the Tet sale season. He said that the purchasing power has been volatile since the beginning of the year, including in rural areas, even though farm produce are considered as having good prices.

Vien said that the total output of Vinamit in 2011 would decrease by 20 percent in comparison with the last year. In the last months of the year, 60 percent of the company’s products will be export, while the other 40 percent for domestic consumption.

Vien has revealed that Vinamit has drawn up new business plans for the year-end consumption season, but it still does not dare to implement the plans because it can see high risks.

“T”, the director of a company specializing in trading dried flowers and pictures, also thinks that the purchasing power will be weak this Tet season. T has come to the conclusion after attending Vietbuild, an exhibition in July and September 2011. Restaurants, hotels and resorts, the main clients of T, did not come to the exhibitions to seek supply sources.

“Consumers nowadays only buy the most essential goods. We once planed to market fragrant essential oil, but we have delayed the plan, because we think the products would not be salable in the current conditions,” she said.

Distributors keep optimistic

While producers feel worried because they cannot foresee the demand, distributors are sure that the purchasing power will still be strong.

Tran Viet Tien, Director of Gia Long Arts Company, said that he has taken a lot of orders to make block calendars. Tien said that the clients his company targets, are big enterprises in the banking and oil and gas sectors, fertilizer, chemicals, pharmacy and industrial enterprises.

Meanwhile, Saigon Co-op Mart, the retailer who is considered as holding the biggest retail market share in HCM City, said that the purchasing power remains very strong. Saigon Co-op has opened a new shopping channel on the HCM City’s TV (HTV Corp), which specializes in distributing high quality products and introducing the production processes of the enterprises which are supplying products to Saigon Co-op.

Nguyen Thi Hanh, General Director of Saigon Co-op, said that she hopes the purchasing power would increase by 40 percent this Tet in comparison with ordinary days. Keeping the prices unchanged on Tet days is the method that the retailer applies to attract more buyers. Saigon Co-op has worked out with producers and suppliers to obtain the commitments from them to provide goods at the committed prices.

Source: TBKTSG

Tags: Vietnam retail, vietnam retail industry, Vietnam retail market, Vietnam super markets