A number of luxurious shopping centres in Vietnam are facing slow sales and even closing as they fail to meet customers’ changing demand.
On the same day, Parkson Viet Tower closed after eight years in Hanoi. This is the third Parkson venue that had to close in the capital.
Shopping centres fails to attract customers
A week before their close, many shops at the Taka Plaza 2 are offering big discounts of up to 50% but there were few customers, even ahead of the Christmas and New Year shopping season.
At an underwear shop, the shop owner, Nguyen Sinh, said that her business is very difficult here.
“I’ve been running the shop since the centre opened,” Sinh said. “It has never been easy attracting customers here but it is becoming more difficult. I’ve lost over VND100 million investing in this shop.”
According to some shop owners, Taka Plaza 2 was once expected to become a busy mall in HCM City but then many had to leave due to slow sales.
Not only Taka Plaza 2, but the same gloomy situation can be seen at many other shopping malls in HCM City including the Saigon Square 3, Lucky Plaza and Saigon Mall.
Saigon Mall is being renovated and turned into an entertainment shopping centre while many shop owners at Saigon Square 3 or Lucky Plaza are abandoning their business.
Changing shopping habits
Proving an explanation for the failure of many luxury shopping malls in Vietnam, a representative of a centre said that Vietnamese people still want to shop for everything including cosmetics, jewellery and clothes at traditional markets.
“People still like traditional markets where they can buy food, vegetables after shopping for clothing or cosmetics,” the anonymous representative said. “For modern shopping centres, they want to have space for their children to play around and restaurants and cafes as well. But many shopping centres fail to meet that demand.”
Economic expert Ly Truong Chien said that Vietnamese retail market still had huge potential but investors need to pay attention to changing shopping trends.
“Ï think that investors should carefully study their target customers and make suitable changes in their business if they want to develop,” Chien confirmed.
Meanwhile, general director of Cushman & Wakefield Vietnam, Alex Crane, also said that customers now tended to want a centre which provides different services and goods.
“A shopping centre where people can shop, eat and entertain is becoming a choice for many people,” Crane said.
“A shop which only sells luxury brands or jewellery is no longer suitable at this time. Customers want to have new experiences.” Crane added.
“Parkson used to do well with their first retail shopping malls during their first years in Vietnam between 2007-2010 but then they’ve failed after expanding this model, while local consumer trends have changed,” he explained.
According to Cushman & Wakefield Vietnam, HCM City now has 131 retail shopping centres and 300,000 square metres have been added in 2016.
However, with a population of over 90 million, the Vietnamese retail market will still have great potential and attract lots of investors in the coming years.
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