Market Monitor - Consumer durables - Vietnam

Market Monitor

  • Vietnam
  • Consumer Durables

31st March 2016

Demand for consumer durables continues to increase, driven by rising living standards.

  • Demand for consumer durable goods in Vietnam continues to increase, driven by a growing middle class, rising living standards, a young population and rapid urbanisation.

 

  • Growth prospects for 2016 remain good, and businesses’ profits are expected to remain stable. However, persisting problems with distribution networks and logistics could continue to limit the growth potential. Competition is high and rising further, as local players have to face increasing market entries of some large foreign players, e.g. from France, South Korea and the US.

 

 

  • Many local consumer durables retail businesses are highly geared, but banks are generally willing to provide credit.

 

  • The current average payment duration in the industry is 30-60 days. Some slower payment is seen in this sector, but mostly not to the extent of turning into non-payment. Non-payments are not expected to increase in the coming months.

 

  • Our underwriting stance for the industry is generally open, and we rely mainly on financial statements and trade experience in our decisions.

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