Masan Group plans to close hundreds of loss-making VinMart and VinMart + stores after purchasing the retail chain.
Decision pending review
Masan Group revealed that the performance of VinMart + was significantly better in Hanoi than in other cities. A representative from Masan said the group will shut down unprofitable stores after reviewing the performance. About ten VinMart supermarkets and 300 VinMart+ convenience stores are marked for closure for now. The retailer will aim to improve the business efficiency of existing locations. By the end of 2019, Hanoi accounted for 34% of VinMart supermarket and 29% of VinMart+ convenience stores. Total sales reached VND26tr (US$1.12bn) but there were also losses of VND2.1tr in earnings before interest, tax and depreciation.
Significant revenue from fresh food this year
Masan plans to reach VND42tr in revenue this year, a year-on-year increase of 64%. 24-25% of growth will be from existing VinMart and VinMart+ stores and the rest from 300-500 new stores opening this year. The group’s pork brand Meat Deli is sold in several VinMart + locations. Masan estimated?pork will contribute another 30 per cent in sales by the first half?and 35 per cent in sales?by the end of this year.
More about the acquisition
On 2nd January, Masan announced ownership of 83.74% of the total outstanding shares of Vingroup’s subsidiary VCM services and trading development joint stock company, which operated VinMart and VinMart + stores. It has spent an estimated VND5.4tn to hold the controlling stake at VCM, which runs more than 3,000 stores in 50 provinces and cities and 14 VinEco hi-tech farms.