Price war brewing on Vietnam’s beer market

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Vietnam beer salesVietnam, the largest market for beer in Southeast Asia, is increasingly attracting foreign brewers even though the country already has a sizeable number of homegrown and imported beer brands for its beer-loving population.

While international giants such as Heineken and Carlsberg having gained a solid standing in Vietnam through their stakes in the two big otherwise state-owned brewers Sabeco and Habeco, and Anheuser-Busch InBev, the world’s biggest beer company, having opened a brewery in southern Vietnam last year produce Budweiser and Beck’s, the Japanese now are starting an offensive.

Sapporo Brewery, the oldest and one of the largest brewers in Japan, said it will begin marketing a low-cost beer brand in Vietnam shortly, joining other rivals seeking to develop this growing middle-class market.

The new label will launch on July 28 and is expected to sell for 13,000 dong to 15,000 dong ($0.58  to $0.67) per 330 ml can at volume retailers. The new brand will offer a refreshing taste for drinkers in Vietnam’s tropical environment. The company aims to sell some 150,000 cases this year.

The new product will target the middle class. In Vietnam, people commonly eat at food stands and large cafeteria-style restaurants. These establishments sell the mid- to low-priced brews that account for around 90 per cent of the beer market.

But competition is increasingly fierce. Sabeco is selling the 333 brand and other low-cost beers priced at the rough equivalent of $0.50. Heineken’s offers include the mid-priced Tiger label.

Sapporo launched Sapporo Vietnam as a joint venture with a state-run tobacco company in 2010. The partners built a brewery the following year near Ho Chi Minh City. But their market share since hovered around just 1 per cent. To increase that share, Sapporo Vietnam is reinforcing its marketing structure and expanding sales channels throughout the country.

Vietnam is currently seeing a frenetic expansion in the beer market. The country is aiming to raise beer output by 25 per cent from 2015 to 2020, according to the Vietnam Beer Alcohol Beverage Association.

With solid economic growth, people, namely younger employees with rising income and spending power, drink ever more beer in a country where 50 per cent of the population are below 30 years old. Of the total alcohol consumed in Vietnam, 94 per cent is beer, which makes the beverage more or less part of the Vietnamese culture.

Beer production in Vietnam reached 3.9 million liters in 2014, according to official statistics and not including self-made Bia Hoi sold at street stalls. But even with the official figures, Vietnam trails only China and Japan among Asian countries by volume. The Vietnamese beer market is expected to surpass Japan until 2025.

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Vietnam, the largest market for beer in Southeast Asia, is increasingly attracting foreign brewers even though the country already has a sizeable number of homegrown and imported beer brands for its beer-loving population. While international giants such as Heineken and Carlsberg having gained a solid standing in Vietnam through their stakes in the two big otherwise state-owned brewers Sabeco and Habeco, and Anheuser-Busch InBev, the world's biggest beer company, having opened a brewery in southern Vietnam last year produce Budweiser and Beck's, the Japanese now are starting an offensive. Sapporo Brewery, the oldest and one of the largest brewers in...

Reading Time: 2 minutes

Vietnam beer salesVietnam, the largest market for beer in Southeast Asia, is increasingly attracting foreign brewers even though the country already has a sizeable number of homegrown and imported beer brands for its beer-loving population.

While international giants such as Heineken and Carlsberg having gained a solid standing in Vietnam through their stakes in the two big otherwise state-owned brewers Sabeco and Habeco, and Anheuser-Busch InBev, the world’s biggest beer company, having opened a brewery in southern Vietnam last year produce Budweiser and Beck’s, the Japanese now are starting an offensive.

Sapporo Brewery, the oldest and one of the largest brewers in Japan, said it will begin marketing a low-cost beer brand in Vietnam shortly, joining other rivals seeking to develop this growing middle-class market.

The new label will launch on July 28 and is expected to sell for 13,000 dong to 15,000 dong ($0.58  to $0.67) per 330 ml can at volume retailers. The new brand will offer a refreshing taste for drinkers in Vietnam’s tropical environment. The company aims to sell some 150,000 cases this year.

The new product will target the middle class. In Vietnam, people commonly eat at food stands and large cafeteria-style restaurants. These establishments sell the mid- to low-priced brews that account for around 90 per cent of the beer market.

But competition is increasingly fierce. Sabeco is selling the 333 brand and other low-cost beers priced at the rough equivalent of $0.50. Heineken’s offers include the mid-priced Tiger label.

Sapporo launched Sapporo Vietnam as a joint venture with a state-run tobacco company in 2010. The partners built a brewery the following year near Ho Chi Minh City. But their market share since hovered around just 1 per cent. To increase that share, Sapporo Vietnam is reinforcing its marketing structure and expanding sales channels throughout the country.

Vietnam is currently seeing a frenetic expansion in the beer market. The country is aiming to raise beer output by 25 per cent from 2015 to 2020, according to the Vietnam Beer Alcohol Beverage Association.

With solid economic growth, people, namely younger employees with rising income and spending power, drink ever more beer in a country where 50 per cent of the population are below 30 years old. Of the total alcohol consumed in Vietnam, 94 per cent is beer, which makes the beverage more or less part of the Vietnamese culture.

Beer production in Vietnam reached 3.9 million liters in 2014, according to official statistics and not including self-made Bia Hoi sold at street stalls. But even with the official figures, Vietnam trails only China and Japan among Asian countries by volume. The Vietnamese beer market is expected to surpass Japan until 2025.

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