Masan revenue earns trillions of dong a year, up 43% compared to before the pandemic

The pandemic has not passed, the war has come, manufacturers simultaneously raised the prices of a series of food items due to pressure from the skyrocketing price of gasoline and input materials. Statistics show that the price of instant noodles has increased by 25% over the same period last year while other items such as cooking oil increased by 23%, sugar by 67%, fish sauce by 28%, gasoline by 48%…

Not only rice, sugar, fish sauce, cooking oil, instant noodle manufacturers also announced to increase product prices. Talking to the press, Mr. Kajiwara Junichi – General Director of Acecook Vietnam Joint Stock Company – said that the enterprise had to increase the price of all products, applied from with different price increase rates depending on the situation. products due to the price of input materials and transportation costs so high that no matter how hard businesses try, they can’t make up for it.

Although instant noodles are considered a secondary product, they are popular in the Vietnamese market. According to the World Instant Noodles Association (WINA) in 2020, Vietnamese people consume 7.030 million packages of instant noodles, just behind China and Indonesia. The Covid-19 pandemic spurs the need to hoard and consume instant noodles. According to estimates by WINA, the world’s demand for instant noodles in 2020 will increase by 14.79% compared to 2019. In Vietnam, this increase will reach 29%, 9 times higher than the growth in demand. average for the period 2015-2019.

Currently, the Vietnamese instant noodle market has the participation of 50 domestic and foreign enterprises, but the market is mainly in the hands of three big players, Acecook, Masan Consumer and Asian Food.

Entering the Vietnamese market since 1995, Acecook with Hao Hao noodles has become a national brand focusing on the mid-end segment, at its peak Acecook occupied nearly 50% of the market share. However, in recent years, Acecook’s market share is only 35%. Acecook’s Hao Hao noodle product has reached a Vietnamese record with 30 billion packages sold in 21 years, from 2000 to 2021.

In 2020, this giant’s instant noodle sales reached VND 11,531 billion, up 8.29% compared to 2019, accounting for 32% of the total market revenue. Meanwhile, Acecook’s instant noodle sales in 2019 and 2018 accounted for 35% and 36.6% of total market revenue, respectively. The gross profit margin in 2020 is 33.6%, Acecook has a quite high gross profit margin compared to other enterprises in the same industry.

In 2021, Acecook Vietnam was warned in the European market about preservatives in the product, causing this giant to struggle. Consumers and many retailers are skeptical about Acecook’s products even though this giant has coordinated with the Ministry of Industry and Trade to check product quality in the Vietnamese market.

Second in the industry is Masan. In the last two years, Masan’s sales growth rate of instant noodles has always been at the top of the market, averaging 33.19% per year, 9 times higher than the whole Vietnamese noodle market. Masan owns the Winmart retail chain, Winmart+ integrated with Masan Consumer leads the instant noodle market with two famous brands, Omachi and Kokomi. In Masan’s retail chain, this giant’s products are prioritized to be placed in beautiful locations, easy to reach customers. Meanwhile, it is difficult for consumers to find some competitors’ instant noodle products on Winmart’s shelves.

From 2020, the Covid-19 pandemic promotes the consumption of instant noodles of Vietnamese people, causing Masan’s revenue to increase sharply. In 2021, the revenue of Masan Consumer’s instant noodles segment reached VND 8,800 billion, up 27.8% compared to 2020, an increase of 43.71% compared to before the pandemic. Masan focuses on the strategy of premiumizing the industry through the Omachi brand’s instant product lines, continuously developing new products that have significantly improved Masan’s gross profit margin over the years. Among the top 4 manufacturers, this index of Masan excels at nearly 39%, Uniben reaches 35%, Acecook 31% and the lowest is Asia Foods with only about 24%.

Although Asia Food is not as aggressive in advertising as Acecook or Masan, this big man is no less competitive. The company focuses on the rural market, which accounts for 65% of Vietnam’s population and has a large consumption of instant noodles. Asia Food with red bear noodles crept to conquer the market, in the period 2016-2019, Asia Food’s revenue always surpassed Masan. However, after the pandemic took place, Masan sped up and left Asia Food behind, until now, the race of the two big men is still very close.

Asia Food owns production plants in 3 regions of the country. In the period 2016-2019, the company’s revenue growth rate recorded a decline, dropping sharply from 24% in 2017 to 4% in 2019. In 2020, Asia Food has returned to growth momentum and revenue of the company reached VND 5,744 billion, up 9% compared to 2019 thanks to high demand due to the impact of the pandemic.

Not only in Vietnam, Asia Food also promotes exports, the company said it currently occupies more than 50% of the market share of instant noodles in Cambodia with the Red Bear brand. However, unlike Vietnam, Cambodia’s instant noodle market is not too large.

According to KantarWorldPanel, the instant noodle market is now not only “instant”, consumers also focus on the taste and quality of the product. The competition of this piece of cake is more fierce when there are a series of imported noodle products from Korea and Japan.

Source: CafeF.vn

Source: Vietnam Insider