The beverage industry in Vietnam is growing with its annual output of more than 2 billion litres.
Major businesses like Tan Hiep Phat, Pepsi and Coca-Cola claim to be expanding their market share in spite of fierce competition.
The Vietnam Beer-Alcohol-Beverage Association (VBA) estimates that each Vietnamese consumes 23 litres per year, less than half compared to its neighbour the Philippines. This means that businesses can still have the lion’s share of the market.
Expanding market share
Not many Vietnamese consumers can understand Vedan’s decision to join the beverage market by introducing itsThien Tra Vedan lemonade soft drink.
Although there are similar products on sale, Vedan’s move indicates that the market segment for soft drinks is still developing well.
The VBA says that over the past decade, the soft drinks market in Vietnam has grown impressively by 20 percent per year, in comparison with elsewhere in the world.
Standing firm on home turf
As consumers are interested in natural drinks, like green tea and herbal tea, Tan Hiep Phat and other local investors have quickly gained the upper hand.
Tan Hiep Phat began in 2001 as a small firm producing an energy drink called Number One, but is able to compete fiercely against foreign producers.
The company has recently built two new factories, one in the central province of Quang Nam to produce 600 million litres per year and another in the northern province of Ha Nam capable of producing up to 950 million litres at full capacity.
Tan Hiep Phat CEO and Chairman, Tran Qui Thanh, said by opening these factories the group save transport costs from Binh Duong to the central and northern regions, reduce its retail prices and better serve its customers better.
Chairman of the Hanoi Supermarket Association Vu Vinh Phu is optimistic about the successful building of local product brands to compete with those of foreign producers.
Phu says Tan Hiep Phat is a rare group in Vietnam, with a wide range of high-quality, healthful products, including Dr. Thanh herbal tea, Tra Xanh Khong Do green tea and Number One energy drink which are being sought after by consumers.
He insists that businesses should apply cutting-edge technology in their production as more than 52 percent of their machines and equipment are outdated.
As a paradoxical fact, only 2 percent of beverage producers utilise high-tech methods, much lower than those in Thailand (31 percent), Malaysia (51 percent) and Singapore (73 percent), he noted.
Tan Hiep Phat is most credited as being in the vanguard of applying the most modern European technology known as “aseptic technique’ to meet food safety standards and maintain all vitamins and original taste of the products.
The company’s newest health drink, Number One Vitamin, which provides vitamins B and C, taurin and inositol, has proved an instant hit in the beverage market.