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How can Vietnam’s goods enter foreign distribution chains?

Improving the quality of exports is the top requirement that Vietnamese manufacturers must meet in order to have their goods accepted by foreign supermarket chains.

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There would be no need to go through many intermediaries as they do now.

Nishitoghe Yasuo, general director of Aeon Vietnam, said Aeon has 17,000 convenience stores in Asia, mostly located in Japan, China and South Korea. The retailer has imported more and more of Vietnam’s goods in recent years.

In 2016, it imported 2 billion yen worth of garments, 390 million yen worth of food, 387 million processed products and 309 million sanitary products. 

Also according to Yasuo, though Vietnam product quality has improved considerably, the problems in food hygiene, stable supply and product diversification still exist. 

Commenting about Vietnamese export companies’ product quality control, Vu Kim Hanh, chair of the Association of High Quality Businesses, said some Vietnam’s exports are still rejected by the US, including dragon fruit and catfish, because manufacturers don’t strictly follow procedures to ensure quality.

“Most Vietnamese enterprises just try to obtain quality management certificates such as VietGap, ISO and HACCP. Most large distributors in the US and other countries don’t care much about this,” Hanh said.

Experts said to enter foreign markets and export directly to foreign large distribution chains, Vietnamese enterprises have to produce goods in accordance with the world's integration standards from the beginning.

Regarding the quality management process for suppliers, Yasuo of Aeon said besides general standards, distributors will also set specific requirements on every group of product. 

As for garments, for example, Aeon will test color fastness, elasticity and compliance with labeling regulations. 

Enterprises have to pass two quality control tests to be eligible to join Aeon supply chain.

It takes Aeon three to four months to check and select suppliers. It shows SCOC (supplier code of conduct) and requests suppliers to follow the code. Suppliers will be exempted from SCOC if they have certificates on quality management such as ISO 9001. 

According to Albin Bertrand from Aucham Retail Vietnam, quality management certificates such as ISO 9001 are what Vietnam’s enterprises need to be able to export products to Europe and Japan. Product traceability is also important.

Dang Hoang Hai, director of the MOIT’s European Market Department, said many of Vietnam’s products are present in large global distribution chains, but they have to go through many intermediaries. 

This makes the products less competitive because intermediary costs drive up retail prices. 

“Thailand’s products have bigger advantages than Vietnam’s because Thai exporters can bring products to international distribution networks,” Hai said.

Source : Vietnamnet Online News
Sep 2017

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