VOVNews.vn:
After officially opening in January 2009, not many foreign groups have landed on Vietnamese soil due to the economic crisis. And foreign groups already present such as Big C and Lotte Mart have expanded their shares by franchise.
Pham Dinh Thuong, deputy head of the Legislation Department of the Ministry of Industry and Trade says that domestic businesses began to compete with foreign partners to gain shares in Vietnam’s retail sales market when the country joined the World Trade Organisation (WTO). Many major Vietnamese businesses have actively coordinated with each other to stake their claims. However, they are less successful than their foreigner counterparts. The Ministry of Industry and Trade reported that there have been 39 foreign and only 20 domestic enterprises registering for franchising.
Franchising is the quickest way to help foreign businesses access Vietnamese market due to regulations such as the economic needs test (ENT). Now foreign businesses can establish 100 percent foreign-owned enterprises, instead of granting franchises to domestic operators as previously. The franchise system will develop rapidly and the number of foreign investors in the field will increase.
Furthermore, foreign businesses are striving to expand the retail sales market. For instance, foreign businesses are not allowed to distribute rice but they have argued that their shops must diversify their products, including rice.
Domestic businesses stuck in slack water… read on.
