Small space, big oppotunity

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In an article appeared on Nikkei Asian Review recently, the writers noticed that the local chains has outshined foreign giants in the sector of convenience-store, here in SE Asia.

A tiny VinMart+ convenience store sits on Le Duan street in Ha Noi's Old Quarter could be an adequate example. The narrow but deep space, occupying less than 100 sq. meters, previously housed a rental photography studio. The site may have been shunned by big players from such countries as Japan, but Vingroup, the conglomerate that controls the chain, saw promise in the high-traffic area.

The entrance of this VinMart+ store in Ha Noi is just a few meters wide. (Photo: Nikkei Asian Review)

According to Nikkei writers, the shop boasts a product lineup on a par with a supermarket, with fresh and processed foods -- including VinEco brand organic vegetables grown by a Vingroup subsidiary -- as well as daily necessities. The aisles are less than a meter wide, allowing for more efficient use of the limited space to pack in more items. The storage space was created upstairs by renovating the space formerly used as residence.

The store expanded the range of prepared foods in June. It has also started holding a sale from 4 p.m. to 7:30 p.m. every weekday, looking to attract women who would normally stop by marketplaces or stores on their way home from work.

Going against the grain of common practice in developed economies - where convenience stores are typically larger, in the 150-200 sq. meter range - is enabling VinMart+ to spread like wildfire, as stated in the article.

Rivals that had initially dismissed the minimarts as harmless are starting to perceive them as a threat. "When we saw how [VinMart+ locations] are sprouting up like mushrooms, we realized that they're serious," said the head of the local arm of a Japanese convenience-store operator.

According to Nikkei, the growth in consumer spending that has accompanied Southeast Asia's economic expansion has been driven in large part not by department stores or supermarkets, but by convenience stores.

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