Features

Tet, or the lunar new year, is just around the corner. Local businesses are scrambling to prepare goods for traditional festivities and hundreds of trade promotion programmes are being organised to woo clients. But, will there be enough goods for consumers and will the prices of commodities rise?

FOOD processing plants in Ho Chi Minh City, like scores of other factories throughout the nation, are rolling up their sleeves to increase production for Tet in anticipation of stronger demand over the lunar new year holiday.
According to the Saigon Trade Corporation (Satra), a leading provider of consumer goods in the city, enterprises’ stock for the coming Tet is up 25-30 per cent on last year.
The average quantity of rice consumed monthly in the city stands at more than 50,000 tonnes, but during Tet there is an increase of around 100 tonnes, including sticky rice which is used to make seasonal delicacies such as banh chung.
Satra says enterprises have conducted market surveys and prepared abundant sources of goods in advance, following the lessons learned from previous years’ market fluctuations and analysis of seasonal shopping patterns.
The city’s meat-processing giant, Vissan, expected to sell 2,300 tonnes of pork over a month-long period starting from December 23 and to post daily sales of 120 tonnes in the five days before Tet, which falls on January 22 this year.
The period will see sales of Vissan beef grow by an estimated 76 per cent, with an 18 per cent increase in sausages, canned food and pressed ham sales.
“We have been securing sufficient pork and beef since July and have been processing food from October,” said Vissan director Vo Van Em, estimating that the company would see revenues of at least $8.5 million this Tet, up 11 per cent on last year.
Cholimex, which processes seafood and exports food products, estimated its stores for Tet had expanded by 40-45 per cent on last year’s figures. The company’s main items include chilli sauce, spices, shrimp paste and meat rolls.
“The estimate is based on the economic growth of Ho Chi Minh City, market surveys and orders from outlets and customers,” said the company’s sales manager Diep Nam Hai.
The Long Binh joint venture in Dong Nai province forecast the demand for chicken to grow 10 per cent year-on-year. The company now supplies 1,000-1,500 semi-processed chickens daily in addition to the 2,500 a day ordered by restaurants, hotels, supermarkets and industrial food caterers in Ho Chi Minh City and other provinces.
While food makers are busy preparing goods for Tet, traders at city markets, supermarkets and shopping centres are also moving to cash in on the business season.
Businesses in Ben Thanh Market in District 1, An Dong Market in District 5 and Binh Tay Market in District 6, have begun reopening their shops for Tet after months off due to a market revamp.
Many supermarkets and trading centres have set up a customer sales network with telephone sales and delivery services aiming to save time for busy families.
The Saigon Co-op, the country’s biggest supermarket chain, is working with food suppliers in local provinces to ensure goods are meeting relevant safety standards. The supermarkets are organising training courses for sales people and developing after-sales services for customers.
Some traders in the Ben Thanh Market have been adopting western practices in food preparation to improve services for both foreign and domestic shoppers.

A trade promotion boom
What stands out during this festive season (lasting from Christmas to Tet) is that local enterprises are also organising trade promotion activities in order to woo customers.
According to the municipal department of trade, more than 170 enterprises in Ho Chi Minh City have so far registered to organise 280 trade promotions at a total cost of VND415 billion ($26.6 million).
“Most of those enterprises are foreign-invested and joint venture concerns. The strongest trade promotions have been for cosmetics, food, drink, household appliances, motorbikes and car enterprises,” said Le Van Cong, head of the department of trade’s promotion division.
He said an average of over VND2 billion ($128,000) has been already spent by enterprises to attract customers each day.
Of those, the Kinh Do Food Company had included two special prizes worth VND100 million ($6,400) each in their cracker and waffle packs, according to the department.
Another 40 consumers would win a Samsung washing machine. Eight would take home a 21-inch Samsung television.
Yamaha Vietnam has given VND4 million ($256) to the first 3,000 clients who bought their Nouvo motorbikes, while Honda Vietnam gave out 100 VND10 million ($640) prizes to Super Dream motorbike buyers.
Do Thang Hai, deputy director of the Trade Ministry’s trade promotion agency, said trade promotion programmes had been effectively carried out since the ministry issued a circular on developing trade promotion nationwide in 2001 and that both customers and enterprises have benefited from the programmes.
However, he noted that there were still a number of unhealthy trade promotions in place, violating the rights and interests of customers.
“We have warned customers to take part only in trade promotions which have been approved by the authorities and to read the regulations carefully before joining any of these promotional schemes,” Hai said.
To achieve effective management of trade promotion, Hai said the ministry needed close coordination with other ministries and sectors including the Ministries of Public Security and Finance.
“The ministry will focus on examining the implementation of trade promotion programmes and deal out severe punishments to any enterprises who have not carried out trade promotion programmes as specified,” he said.

The price of plenty
In a bid to ensure efficient service for consumers, local companies are usually given loans to maintain stock and prevent prices from skyrocketing over the festive period.
However, for breweries, prices are forecast to increase dramatically due to high demand for beer during Tet, and taxes on breweries and alcohol.
From January 1, the special consumption tax rate for canned beer increased by 10 percent to 75 per cent. The tax for beverages above 40 degrees proof rose by five per cent to 75 per cent, while that for 20 to 40 degrees proof products rose to a minimum of 30 per cent from 25 per cent previously.
In the past, breweries paid no value-added tax, as they were already subject to the special consumption tax. But, according to the Vietnam Alcohol and Beverage Association, the amended laws mean they will be paying a value-added tax tariff of 10 per cent as well as the special consumption tax.
Given the new position of breweries, many agents were rushing to stockpile beer before the new year in order to take advantage of the price hike.
Tran Minh Triet, sales director of Vietnam Brewery, which manufactures Tiger and Heineken, said his factory saw orders swelling by 70-80 per cent beyond average levels.
“Our factory has had to operate three shifts to supply enough beer for buyers,” he said, adding that many businesses registered to buy beer as gifts for their end of year promotional programmes.
Saigon and Ben Thanh breweries said they had sold increased quantities of beer over the past month, but refused to give out the exact figures.
Nguyen Duc Thinh, a beer distributor on Huynh Van Banh Street in the city’s Phu Nhuan District, says his shop does not have enough beer to supply outlets or restaurants and hotels although he bought four times more than previously.
The same goes for the agent of San Miguel-brand beer on Bac Hai Street in District 10. The agent is in short supply although it has taken on extra more stock in the past month, owner Le Van Toi said.
Though breweries’ prices remained the same until January 1, many agents had increased beer prices by VND5,000-10,000 per 24-can carton before that date.
Meanwhile, fashion and footwear traders have been attaching fixed prices to protect customers from price hikes.
More than 6,000 traders have agreed to sell their goods at official prices, and many shops have pledged not to sell counterfeit or substandard goods.
Shopping centres and fashion stores in town have marked down prices by 10 per cent recently to attract more buyers in the end of year shopping spree.
A store specialising in Tony-brand fashion items on Hai Ba Trung Street in District 3 is offering discounts of 30-80 per cent, with the lowest price fixed at VND20,000 for some items.
Customers can seek discounts from 30-80 per cent for clothes at B-Blue on Cong Quynh District 1. Shops on the seventh floor of Zen Plaza at 54 Nguyen Trai Street in District 1 are discounting prices of fashion items and footwear by 35-70 per cent, including Oxy, Senti, Nguyen Long and Caro brands.