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|Japanese confectionery giant Morinaga unlocks Vietnamese market|
Morinaga has linked up with DKSH’s Consumer Goods Business Unit to help its expansion to Vietnam and reinforce their existing partnership in Asia to the country.
According to the agreement, DKSH will be the enabler to further unlock Morinaga's potential in Vietnam and ensure regional coverage through the strategic expertise of the local teams.
The key objective of the collaboration is to drive Morinaga’s growth in the confectionery category, leveraging DKSH’s strong position in the rising convenience stores (CVS) channel, achieve comprehensive coverage in modern trade and deep capillary distribution in traditional trade. Besides a strong focus on coverage expansion for Morinaga, DKSH will pay special attention to increasing Hi-Chew and Dars Chocolate’s visibility across all channels and the whole region.
Terry Seremetis, head of the Consumer Goods Business Unit, commented, “We are thrilled to expand our regional collaboration with Morinaga to Vietnam. This extension is another true testament to our strength in this key market. Furthermore, adding Hi-Chew and Dars Chocolate to our brand portfolio will help us keep driving the distribution of confectionery amongst Vietnamese households.
Established in 1899 and listed in the First Section of the Tokyo Stock Exchange, Morinaga is one of the big Western confectionery manufactures in Japan. It consists of business activities of the manufacturing, purchase, and sales of confectioneries, food, frozen desserts, and health products. Morinaga generates consolidated net sales of ¥205 billion ($1.86 billion) and operating income of ¥20 billion ($182.2 million) in 2018.
Vietnam has massive potential in this sector, with major players in the market including Orion Food Vina, Vinamilk, PepsiCo Vietnam, Mondelez Kinh Do, and Bien Hoa Confectionery Corp.
According to figures from Statista.com, revenue in the ice-cream segment is expected to reach $74 million in 2019, with the compound annual growth rate (CAGR) of 7.4 per cent in 2019-2023.
Regarding the snack segment, according to a recent study by Kantar Worldpanel, which deals in consumer knowledge and insights based on continuous consumer panels, the Vietnamese snack market – which was valued at $518 million in 2015 – is expected to grow to $1 billion by 2020. The FMCG market in Vietnam is predicted to grow at a compound annual growth rate (CAGR) of 5-6 per cent by 2020.
To win over Vietnamese consumers, local and foreign brands need to understand local consumer behaviour and preferences to stay abreast of the latest trends, which include health and nutrition and indulgence, by offering new products and new tastes and flavours.