Beer in Vietnam
Euromonitor International's Beer in Vietnam market report offers a comprehensive guide to the size and shape of the market at a national level. It provides the latest retail sales data, allowing you to identify the sectors driving growth. It identifies the leading companies, the leading brands and offers strategic analysis of key factors influencing the market - be they new product developments, packaging innovations, economic/lifestyle influences, distribution or pricing issues. Forecasts illustrate how the market is set to change.
Buy online to access strategic market analysis and an interactive statistical database of volume and value market sizes including on-trade and off-trade, company and brand shares, distribution and pricing data.
Tables: 63 | Publication date: Apr 2009
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive environment
Product coverage
Dark beer; Lager by origin; Lager by price platform; Low/non- alcohol beer; Stout
Executive summary
Beer recorded strong performance in 2008 with total volume growth of more than 9%, despite high price inflation in Vietnam. This was attributed to Vietnam’s economic growth of around 8% and increasing disposable incomes which has led to a change in Vietnamese consumers’ drinking habits from traditional rice wine to beer. In addition, the emergence of Vietnam’s tourism and hospitality market coupled with increasing numbers of expatriates in Vietnam also contributed to make Vietnam an attractive market for many manufacturers as well as importers.
In 2008, beer volume growth was half a percentage point higher than the review period CAGR. However, in current value terms, growth in 2008 was over two points lower than the review period CAGR as many retailers and manufacturers tried to launch frequent price promotion programmes to boost volume sales as there was strong competition in the market as well as a slowdown in economic growth, especially in the second half of 2008.
In terms of volume growth, economy lager saw the fastest growth in 2008, at 10%, while both premium lager and economy lager together recorded the fastest current value growth of 11% in 2008. This showed that while premium lager brands maintained their growth through premium prices, economy lager manufacturers also succeeded in expanding their market into rural areas to gain volume growth among lower- and middle-income consumers.
Average unit prices of beer increased stronger in 2008 compared to a year earlier due to inflation pressures. However, this did not have any significant impact on beer consumption among the Vietnamese who have gradually developed a beer-drinking habit.
Standard lager remains most favoured by Vietnamese beer drinkers because of its reasonable price and acceptably good quality. In 2008, standard lager dominated sales with a volume share of 44%, with the brands Tiger, Saigon Special and 333’ export the most preferred thanks to their frequent advertising and promotional campaigns, especially during festive occasions.
In 2008, on-trade sales recorded slightly higher growth than off-trade sales to account for more than 72% of total volume. This is in line with the lifestyles of Vietnamese consumers. While Vietnamese people like to invite friends or relatives to their homes for special occasions, they prefer to spend much more of their time with friends and colleagues drinking outside the home. Indeed, this is not only a chance to socialise but many feel more comfortable discussing their work over a glass of beer.
In addition, along with the development of the Vietnamese economy, improvements in living standards, the rising number of young people as well as tourists and expatriates, the appearance of numerous modern bars, pubs and discotheques has also spurred volume sales through these channels. Furthermore, some seasonal factors such as hot weather especially in summer, Christmas and the traditional Tet holiday contributed greatly to total volume sales of beer.
Although volume sales of stout and dark beer are still very small and were negligible throughout the review period with limited brands such as Amber Stout from Vietnam Brewery Ltd or imported Danish Royal Stout, the launch of Guinness from Saigon Brewery Co in late 2007 attracted interest from many consumers who like to try new and strong tastes and believe that the stronger the taste the better the beer.
This trend also applies to low/non-alcohol beer; though there has been some effort from manufacturers to launch low/non-alcohol beer such as Coors Light in 2006, such products are still not very commonly found and favoured in the Vietnam market. This is attributed to the perception among Vietnamese that a stronger taste is better. Hence, there was no significant demand for low/non-alcohol beer during the review period.
Production, Imports and Exports
Beer production varies depending on consumer demand during different festive occasions and events in Vietnam. During some seasonal periods such as Christmas, the year end and the Tet holiday, demand for beer always goes up significantly owing to numerous parties and weddings. Hence, most manufacturers make great efforts to increase their production capacity to meet consumer demand during these periods to gain lucrative volume and value sales. Indeed, many manufacturers such as Saigon Brewery Co also increase their prices during these periods to gain higher benefits. However, it was reported in 2008 that Saigon Brewery Co had committed to maintain normal prices during the Tet holiday in line with the Vietnamese government’s policy.
Over the review period, domestic brands continued to dominate sales. However, 2008 saw greater presence of imported brands from Belgium such as Leffe and Stella Artois and Germany such as Warsteiner and Kulmbacher and they are becoming more competitive with reasonable prices and good quality. Furthermore, with the rising demand for beer in Vietnam, a number of premium brands such as Kronenbourg from France have also made an entrance. In terms of export trends, domestic players such as Saigon Brewery Co, Hanoi Brewery and Hue Brewery Ltd have also tried to expand their markets to the US, Canada, Japan, Australia, Germany, the UK, South Korea, Hong Kong, and Thailand among others.
On comparing between domestic and imported sales, domestic brands still lead sales with more than 80% of total volume, with Saigon Brewery Co, Vietnam Brewery Ltd and Hanoi Brewery accounting for more than 50%. This is attributed to their key strategy of mainly targeting Vietnamese consumers in the standard product segment with reasonable prices and quality while imported brands face the obstacle of high import tax rates.
Table of contents
ALCOHOLIC DRINKS IN VIETNAM : MARKET INSIGHT
EXECUTIVE SUMMARY
Alcoholic drinks recorded strong performance in 2008
Beer continued to lead growth in 2008
SABECO remains leader while Vietnam Brewery and HABECO move up
On-trade channel dominates distribution
Alcoholic drinks expect healthy growth over the forecast period
KEY TRENDS AND DEVELOPMENTS
Increasing consumer base and living standards drive alcoholic drinks growth
New drinking habits emerge among Vietnamese consumers
Tougher competition as a result of global integration
Multinationals strengthen their presence in the market
More brand promotion activities to retain competitive advantage
Specialist retailers
Market mergers and acquisitions activity
Summary 1 Speculative Mergers and Acquisitions Activity
MARKET BACKGROUND
Legislation
TAXATION AND DUTY LEVIES
Table 1 Taxation and Duty Levies on Alcoholic Drinks 2008
Table 2 Typical Wholesaler and Retailer Off-trade Mark-ups by Selected Sectors 2008
Table 3 Selling Margin of a Typical Domestically Produced Beer Brand 2008 - Larue
Table 4 Selling Margin of a Typical Domestically Produced Wine Brand 2008 - Dalat
Table 5 Selling Margin of a Typical Imported Wine Brand 2008 – Jacob’s Creek
Table 6 Selling Margin of a Typical Domestically Produced Spirits Brand 2008 – Hanoi Lua Moi
Table 7 Selling Margin of a Typical Imported Spirits Brand 2008 – Smirnoff Red
OPERATING ENVIRONMENT
MARKET INDICATORS
Table 8 Retail Consumer Expenditure on Alcoholic Drinks 2003-2008
MARKET DATA
Table 9 Sales of Alcoholic Drinks by Sector: Total Volume 2003-2008
Table 10 Sales of Alcoholic Drinks by Sector: Total Value 2003-2008
Table 11 Sales of Alcoholic Drinks by Sector: % Total Volume Growth 2003-2008
Table 12 Sales of Alcoholic Drinks by Sector: % Total Value Growth 2003-2008
Table 13 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: Volume 2008
Table 14 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: Value 2008
Table 15 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: % Volume 2008
Table 16 Sales of Alcoholic Drinks by Sector by On-trade vs Off-trade Split: % Value 2008
Table 17 Company Shares of Alcoholic Drinks by Global Brand Owner 2004-2007
Table 18 Off-trade Sales of Alcoholic Drinks by Distribution Format: % Value Analysis 2008
Table 19 Off-trade Sales of Alcoholic Drinks by Sector and Distribution Format: % Volume Analysis 2008
Table 20 Forecast Sales of Alcoholic Drinks by Sector: Total Volume 2008-2013
Table 21 Forecast Sales of Alcoholic Drinks by Sector: Total Value 2008-2013
Table 22 Forecast Sales of Alcoholic Drinks by Sector: % Total Volume Growth 2008-2013
Table 23 Forecast Sales of Alcoholic Drinks by Sector: % Total Value Growth 2008-2013
DEFINITIONS
Sources
Summary 2 Research Sources
LOCAL COMPANY PROFILES - VIETNAM
DONG XUAN LIQUOR CO LTD - ALCOHOLIC DRINKS - VIETNAM
STRATEGIC DIRECTION
KEY FACTS
Summary 3 Dong Xuan Liquor Co Ltd: Key Facts
Summary 4 Dong Xuan Liquor Co Ltd: Operational Indicators
COMPANY BACKGROUND
PRODUCTION
Summary 5 Dong Xuan Liquor Co Ltd: Production Statistics 2007
COMPETITIVE POSITIONING
Summary 6 Dong Xuan Liquor Co Ltd: Competitive Position 2007
HANOI BREWERY CO - ALCOHOLIC DRINKS - VIETNAM
STRATEGIC DIRECTION
KEY FACTS
Summary 7 Hanoi Brewery Co: Key Facts
COMPANY BACKGROUND
PRODUCTION
Summary 8 Hanoi Brewery: Production Statistics 2007
COMPETITIVE POSITIONING
Summary 9 Hanoi Brewery Co: Competitive Position 2007
LAMDONG FOODSTUFFS JSC (LADOFOODS) - ALCOHOLIC DRINKS - VIETNAM
STRATEGIC DIRECTION
KEY FACTS
Summary 10 LamDong Foodstuffs JSC: Key Facts
COMPANY BACKGROUND
PRODUCTION
Summary 11 LamDong Foodstuffs JSC: Production Statistics 2007
COMPETITIVE POSITIONING
Summary 12 LamDong Foodstuffs JSC: Competitive Position 2007
SAIGON BREWERY CO (SABECO) - ALCOHOLIC DRINKS - VIETNAM
STRATEGIC DIRECTION
KEY FACTS
Summary 13 Saigon Brewery Co: Key Facts
Summary 14 Saigon Brewery Co: Operational Indicators
COMPANY BACKGROUND
PRODUCTION
Summary 15 Saigon Brewery Co: Production Statistics 2007
COMPETITIVE POSITIONING
Summary 16 Saigon Brewery Co: Competitive Position 2007
THANG LONG LIQUOR CO - ALCOHOLIC DRINKS - VIETNAM
STRATEGIC DIRECTION
KEY FACTS
Summary 17 Thang Long Liquor Co: Key Facts
COMPANY BACKGROUND
PRODUCTION
Summary 18 Thang Long Liquor Co: Production Statistics 2007
COMPETITIVE POSITIONING
Summary 19 Thang Long Liquor Co: Competitive Position 2007
BEER IN VIETNAM
HEADLINES
TRENDS
Production, Imports and Exports
COMPETITIVE LANDSCAPE
PROSPECTS
SECTOR BACKGROUND
Lager price band methodology
Summary 20 Lager by Price Band 2008
Published Data Comparisons
SECTOR DATA
Table 24 Sales of Beer by Subsector: Total Volume 2003-2008
Table 25 Sales of Beer by Subsector: Total Value 2003-2008
Table 26 Sales of Beer by Subsector: % Total Volume Growth 2003-2008
Table 27 Sales of Beer by Subsector: % Total Value Growth 2003-2008
Table 28 Sales of Beer by On-trade vs Off-trade Split: Volume 2003-2008
Table 29 Sales of Beer by On-trade vs Off-trade Split: Value 2003-2008
Table 30 Sales of Beer by On-trade vs Off-trade Split: % Volume Growth 2003-2008
Table 31 Sales of Beer by On-trade vs Off-trade Split: % Value Growth 2003-2008
Table 32 Beer: Production, Imports and Exports: Total Volume 2002-2007
Table 33 Beer Exports by Country of Destination: Total Volume 2002-2007
Table 34 Beer Exports by Country of Destination: Total Value 2002-2007
Table 35 Beer Imports by Country of Origin: Total Volume 2002-2007
Table 36 Beer Imports by Country of Origin: Total Value 2002-2007
Table 37 Company Shares of Beer by National Brand Owner 2003-2007
Table 38 Company Shares of Beer by Global Brand Owner 2003-2007
Table 39 Brand Shares of Beer 2004-2007
Table 40 Forecast Sales of Beer by Subsector: Total Volume 2008-2013
Table 41 Forecast Sales of Beer by Subsector: Total Value 2008-2013
Table 42 Forecast Sales of Beer by Subsector: % Total Volume Growth 2008-2013
Table 43 Forecast Sales of Beer by Subsector: % Total Value Growth 2008-2013