Bringing Vietnamese goods to the retail system in Japan

Friday, 2019-06-07 16:58:57
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At the 2018 Vietnam - Hanoi Goods Week
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NDO – The 2019 Vietnam – Hanoi Goods Week, the third of its kind, is taking place at 40 supermarkets of Japan’s retail giantAEON in Saitama province and Kanto region from June 5-12.

The programme aims to promote the consumption of Vietnamese products in Japan's largest retail system, thereby boosting the exports and expanding international markets.

Gradually approaching Japanese market

According to the Hanoi Promotion Agency (HPA), the main location for the 2019 Vietnam – Hanoi Goods Week is AEON Lake Town Trade Centre in Saitama province, with a total area of around 500 square metres. Various activities are being held during the week, including the trade promotion between Vietnamese enterprises and import clues of AEON Group, the introduction of products and capacities of Vietnamese firms, a workshop on regulations and standards of imported goods to AEON’s distribution system, and meetings and negotiations between the two sides’ businesses. Vietnamese exporters will directly introduce their products to Japanese consumers, thereby learning about the demands and tastes of this particular market.

The HPA’s Deputy Director Nguyen Thi Mai Anh said that Hanoi has signed a cooperation agreement with AEON Group to bring Vietnamese goods to its supermarkets both in Japan and Vietnam for 20 years. The Vietnam – Hanoi Goods Week in Japan is one of the many activities to enhance trade promotion, contributing to boosting exports and promoting the tourism and culture of Vietnam in general and Hanoi in particular to the 'Land of the Rising Sun’. The HPA, in coordination with AEON Group, selected six out of hundreds of products for the 2018 Vietnam – Hanoi Goods Week. The turnover from a trial sale of these products during the week was over VND6 billion. The turnover from this year’s week is expected to reach VND10 billion.

In order to support Vietnamese enterprises to approach Japanese consumers, the Ministry of Industry and Trade and AEON Group have signed a memorandum of understanding (MoU) on supporting the export of Vietnamese products to the Japanese market. Accordingly, Vietnam’s export turnover through AEON system is expected to reach US$500 million in 2020 and US$1 billion in 2025.

General Director of AEON TopValu Vietnam Limited Company Shiotani Yuichiro said that under the MoU, AEON has developed a specific plan for Vietnamese businesses, in which the group will give high-tech support to improve the export capacity of firms meeting Japanese market’s standards.

Vietnamese enterprises need to improve themselves

The door to enter AEON’s distribution system and Japanese market is opening up for Vietnamese enterprises. However, it is very difficult for them to walk through this ‘door’. General Director Shiotani Yuichiro said that it is fact Vietnamese products that have not yet competed with similar products in Japan. The communities of strength, such as garment, household goods and food, have still yielded to those imported from other countries. Among nearly 3,000 suppliers for AEON Vietnam, only between 200 and 300 are able to meet international standards and export experience to bring goods into the Japan’s retailer.

Head of Quality Management Department under the AEON Topvalu Vietnam Limited Company Ikesa Masahito explained that the Japanese market has its own standards and so does AEON. In order to sell any products at its supermarket chains, the group will conduct appraisals and consult customers. In addition, the group will evaluate suppliers in terms of standards of quality management, working conditions and environmental management. Following the samples, the goods will be checked right at thefactories and officially sold after completing all previous stages. The first orders may be small, but if the goods receive positive feedback from customers, AEON will directly invest into firms and order larger quantities.

The HPA’s Deputy Director Nguyen Thi Mai Anh said that Vietnamese enterprises have not yet met standards set by partners, especially in production equipment and raw materials. Many firms have used materials from other countries while Japanese side expects products made of materials from Vietnam.

General Director of Aligro Joint Stock Company Hoang Van Linh noted that enterprises should take careful steps and have a thorough understanding of the Japanese market in general and the AEON Group in particular. To bring apparel products into the AEON system, the company has carefully learnt about the style and materials for Japanese customers. Aligro has also used modern equipment as well as taken advantage of human resources to produce goods with competitive prices, creating a firm foothold in AEON and Japanese market.

In addition to support from management agencies, firms should actively enhance their investment, expand their scale, improve the quality of their products and approach to foreign markets.