Vietnam Consumer Packaged Goods Market Outlook to 2030

Vietnam Consumer Packaged Goods Market Overview

• The Vietnam consumer packaged goods market has experienced notable growth, this is reflected by global market reaching a valuation of 2.3 billion in 2023, driven by increasing urbanization, a growing middle class, and rising disposable incomes. The demand for convenience products and the proliferation of modern retail channels have boosted market growth.
• Prominent players in the Vietnam CPG market include Vinamilk, Masan Consumer, Unilever Vietnam, Nestle Vietnam, and Acecook Vietnam. These companies dominate the market through extensive distribution networks, strong brand loyalty, and continuous product innovation.
• Vinamilk announced the opening of a new $150 million dairy processing plant in Hanoi, aiming to increase production capacity by 30%. This development aligns with the company's strategy to meet the growing domestic demand and expand its export capabilities. Additionally, Unilever Vietnam reported a 10% increase in revenue for 2023, driven by strong sales in personal care and home care segments.
• Hanoi and Ho Chi Minh City are the dominant cities in the Vietnam CPG market. These cities account for more than half of the market share due to their high population density, greater purchasing power, and well-established retail infrastructure. The presence of numerous supermarkets, hypermarkets, and convenience stores in these urban centers makes them key hubs for CPG consumption.

Vietnam Consumer Packaged Goods Market Segmentation

The Vietnam Consumer Packaged Goods Market can be segmented by various factors like product type, distribution channel, and region.

By Product Type: The Vietnam CPG market is segmented by product type into food and beverages, personal care products, and household goods. In 2023, the food and beverages segment held the largest market share. This dominance is attributed to the high demand for packaged foods, dairy products, and beverages, driven by a busy urban lifestyle and the need for convenience.

By Distribution Channel: The market is segmented by distribution channel into supermarkets/hypermarkets, convenience stores, and online retail. In 2023, supermarkets dominates the market, the widespread presence of supermarket chains like VinMart and Co.opmart, offering a variety of CPG products under one roof, attracts a large consumer base. These stores provide a convenient shopping experience with frequent promotions and discounts.

By Region: The Vietnam CPG market is segmented by region into North, South, East, and West. The northern region, held a dominant market share in 2023. This is due to its high urbanization rate and important economic activities. Hanoi, being the capital city, attracts numerous multinational companies and investors, contributing to the robust demand for CPG products.

Vietnam Consumer Packaged Goods Market Competitive Landscape

• Masan Consumer: Masan Group had already acquired a 51% stake in Phuc Long Coffee & Tea in January 2022 and increased its stake to 85% in August 2022. The integration of Phuc Long's extensive retail network is expected to enhance which is aimed at increasing production capacity of packaged goods and meeting the rising consumer demand.
• Unilever Vietnam: With more consumers preferring brands that embrace sustainable practices, Unilever Vietnam has made many strides in introducing eco-friendly packaging solutions. Unilever aims for recyclability in all their bottle packaging and to reduce 87% of virgin plastic through various initiatives, including the use of recycled materials for packaging.

Vietnam Consumer Packaged Goods Industry Analysis

Vietnam Consumer Packaged Goods Market Growth Drivers

• Expansion of Modern Retail Infrastructure: The proliferation of supermarkets and hypermarkets across Vietnam have enhanced the availability and accessibility of CPG products. In 2023, Vietnam had over 3,500 supermarkets and hypermarkets, with major chains like VinMart and Co.opmart increasing their presence. This expansion supports the growth of the CPG market by providing consumers with a wide range of product options.
• Rising E-commerce Adoption: Vietnam has been the fastest growing market for adoption of e-commerce platforms, with online retail sales for CPG products in 2023. The convenience and accessibility of online shopping, coupled with attractive promotions, have contributed to this growth. Platforms like Shopee and Lazada have become major channels for CPG sales, further driving market expansion.
• Increasing Health Awareness: The rise in health consciousness among Vietnamese consumers has driven demand for healthier CPG products. In 2024, the market saw a 20% increase in sales of organic and natural food products. Companies like TH True Milk and Vinamilk have expanded their organic product lines to cater to this demand, leading to an overall boost in the market.

Vietnam Consumer Packaged Goods Market Challenges

• Supply Chain Disruptions: The CPG market faced challenges due to supply chain disruptions caused by Israel-Palestine conflict. The cost of raw materials increased, impacting production costs for CPG manufacturers. Ensuring consistent supply and managing logistics remain critical challenges for market players.
• Rising Prices of Products: Rising prices led to a fascinating display of adaptability, with shoppers employing a mix of strategies to manage their budgets. While some categories witnessed volume reduction, others grew by addressing shoppers' quest for value. It was recorded that over half of FMCG brands struggled to keep pace with the competition in 2023.

Vietnam Consumer Packaged Goods Market Government Initiatives

• "Made in Vietnam" Initiative: The "Made in Vietnam" initiative was officially launched on September 1, 2020. This initiative aims to promote Vietnamese products, enhance local manufacturing capabilities, influenced by this companies like Aeon Topvalu Vietnam are ramping up their procurement of agricultural and aquatic products from Vietnam.

• E-commerce Development Plan: Vietnam's e-commerce market experienced robust growth, with a reported increase in 2023, reaching an estimated market size of $20.5 billion. To support the growth of online retail, the government implemented an e-commerce development plan in 2023. The plan focuses on improving digital infrastructure, providing training for businesses, and enhancing cybersecurity measures.

Vietnam Consumer Packaged Goods Market Future Outlook

Vietnam consumer product Packaged goods market is growing exceptionally, this growth is fueled by consumer preferences for packaged foods and beverages, personal care products, and household goods, which are becoming staples in urban Vietnamese households.

Future Market Trends

• Increased Focus on Health and Wellness: Vietnam CPG market will see a continued focus on health and wellness products. Companies are expected to invest heavily in developing functional and fortified foods, catering to health-conscious consumers. By 2028, it is anticipated that health and wellness products will account for a large portion of the market, driven by consumer demand and government health initiatives.
• Sustainability and Ethical Consumption: In the next five years the trend towards sustainability will intensify, with more companies adopting eco-friendly practices and offering sustainable product options. Sustainable and ethically sourced products are expected to dominate the market, as consumers become more environmentally conscious. Government regulations and corporate social responsibility initiatives will further drive this trend, ensuring a greener future for the CPG market.