One of Asia's leading chains of convenience stores signs MOU with Palexy.
Ho Chi Minh City. -- November 3, 2020 -- Vietnam's first convenience store opened in 2006. Since then, this segment of the retail market has been growing at an impressive rate: the total number of convenience stores has quadrupled since 2012; over the course of just one year (2018-2019), it has risen by 72%. Needless to say, the competition has been fierce with both local and global players vying for the lion's share of Vietnam's large & expanding consumer base. In this race, surprisingly although not quite unexpectedly, home-grown retailers have outperformed foreign peers, at least in terms of number. Of the 1300 convenience stores that opened within one year, half came from Vinmart, a branch of Vingroup, the nation's biggest conglomerate.
Just when this hotbed just got a whole lot hotter, GS25 of GS Group became the newest contender. Hailing from South Korea where it holds a respectable 30% of the retail market, GS25 has selected Vietnam for its first venture into overseas territory, skipping other promising Southeast Asian countries and China. GS25 banks its prospects of success in Vietnam on two factors: 1. prominent enclaves of Korean expats who reside in the country, mostly in its two major hubs, Hanoi and Ho Chi Minh city, and 2. the widespread marketability of Korean pop culture among Vietnamese citizens. Sonkim Group, a multi-industry company focusing on real estate development and retail, is responsible for its debut. GS25 has set its sights high: to become the No.1 convenience store chain in Vietnam, and to open 2500 stores within 10 years.
These are lofty goals, indeed. Not only does GS25 have to face stiff competition from other players with more experience operating in Vietnam such as 7-Eleven, Circle K, Shop & Go, and the formidable Vinmart+, the extensive network of traditional wet markets and grocery stores present more challenges still. Some international retailers have not been able to withstand the heat and have withdrawn, either partly or completely, from Vietnam's market: Metro, Auchan, and Family Mart. GS25 is no stranger to rivalry, however: while South Korea's retail market was initially dominated by 7-Eleven and Family Mart, GS25 step by step overtook these two heavyweights to reign supreme in its homeland. As GS Group's fasting growing brand, i.e. golden child, GS25 is also also tasked with paving the way for other businesses to enter Vietnam's market. Taking a AI-powered route with Palexy is seen as GS25's move to have a leg up in this race.