CATEGORIES

© Copyright 2004; Hanoitimes - Economic and Urban Newspaper;

The tribune of Hanoi People’s Committee

Publication Permit: 29/GP-CBC

Editor - in - Chief: Nguyen Thanh Loi

Managing Editor: Ta Thu Giang

Email : thugiang@hanoitimes.vn

Head Office: 21 Huynh Thuc Khang Street, Dong Da District, Hanoi

Branch Office: 221 Tran Phu Street, Ha Dong District, Hanoi

WORDS ON THE STREET 70th anniversary of Hanoi's Liberation Day Vietnam - Asia 2023 Smart City Summit Hanoi celebrates 15 years of administrative boundary adjustment 12th Vietnam-France decentrialized cooperation conference 31st Sea Games - Vietnam 2021 Covid-19 Pandemic
Home / Investment / News
Aeon parts from Vietnam's Fivimart as losses linger
Ngoc Mai 06:35, 2018/09/28
The cooperation with Aeon was supposed to boost efficiency in Fivimart`s corporate governance, promoting brand and expanding the network, but reality didn`t meet expectations.
Aeon, a major Japanese retailer, and Nhat Nam Trade Company - owner of the Fivimart supermarket chain, have agreed on the transfer of the Fivimart chain to a domestic company on September 27, ending the four-year partnership between the two, Tri Thu Tre reported. 
 
Illustrative photo.
Illustrative photo.
Consequently, Aeon is expected to offload 30% stake in Fivimart for a third party. However, the move would not have any impact on its current business in Vietnam.

Detail of the transaction was not disclosed. 

On the same day, Fivimart announced the change of its brand identify. Starting September 28, Fivimart will no longer use Aeon logo beside its own logo in public. 

Rumor about the "divorce" between Fivimart and Aeon started on the market in early September, which reportedly was due to inefficient cooperation. 

Since the begin of the partnership in 2015, Fivimart increased its supermarkets from 10 to 23 in 2017, while revenue jumped from VND1.07 trillion (US$45.64 million) during the 2015 - 2017 period. 

However, Fivimart posted a loss of VND60 billion (US$2.56 million) in 2015, which later widened to VND96 billion (US$4.09 million) a year later. In 2017, the local supermarket chain reported a loss of VND23 billion (US$981,318), resulting in an accumulated loss of VND197 billion (US$8.4 million). 

The cooperation with Aeon was supposed to boost efficiency in Fivimart's corporate governance, promoting brand and expanding the network, which in reality did not go according to plan. 

Fivimart's cost of goods sold  in the 2016 - 2017 period was over VND1 trillion (US$42.68 million), equivalent to 80% of total revenue, according to the company's financial statement. 

Moreover, administrative and financial expenses remain at a high level, reaching VND272 billion (US$11.6 million) and VND11.8 billion (US$503,612), respectively. 

After ending its cooperation with Fivimart, Aeon still maintains the business partnership with Citimart, of which the Japanese retailer acquired a 49% stake in 2015. However, Citimart also reported a loss of VND91 billion (US$3.88 million) in 2015 and VND33 billion (US$1.4 million) in 2016, resulting in an accumulated loss of VND157 billion (US$6.7 million) at the end of 2016.

Aeon considered Vietnam's retail market has huge growth potential and plans to establish 20 large-scale shopping malls in the country by 2020. In addition to the existing four shopping malls, Aeon will shortly launch the other two in Hai Phong city and Ha Dong district (Hanoi). 
Comments
Other news
14:43, 2024/11/18
Aircraft manufacturer Embraer seeks comprehensive aviation partnership with Vietnam
The Vietnamese leader urges the aircraft manufacturer to collaborate on technology transfer, airport construction and operation, research, and investment in Vietnam.
21:55, 2024/10/22
Better links with FDI firms to support Hanoi businesses
Hanoi will continue to focus on quality projects, especially with partners such as Japan, the United States, and Europe to boost technology transfer.
15:24, 2024/09/24
Vietnam calls for more US investment in innovation, hi-tech
The Vietnamese leader called on relevant agencies to resolve any challenges faced by investors and enhance the investment climate to encourage greater US investment in Vietnam.
14:13, 2024/09/23
Vietnamese leader urges Boeing to build production facility in Vietnam
Boeing is committed to continuing to support the development of Vietnam's aviation ecosystem, focusing on aviation infrastructure, human resources training, airport construction, and aircraft maintenance facilities.
14:38, 2024/09/17
Foreign capital pouring into Vietnam's real estate market
Experts are optimistic that the 2024 Land Law, once enacted, will help resolve legal bottlenecks and attract more FDI.
16:27, 2024/08/24
Vietnam news in brief - August 24
Read The Hanoi Times to stay up to date on developments in Vietnam.