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Vietnam Detergent Market Report 2018


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Vietnam Detergent Market 2018 includes detail key players, overview of market performance and upcoming trends

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Vietnam Detergent Market Report 2018

  1. 1. INDUSTRY PREVIEW Vietnam Detergent Market 2018
  2. 2. Page 2 Table of Contents No Contents Page 1 Vietnam Home Care Market Preview 2018 2 – 10 1.1 Market Structure & Description 3 1.2 Size & Segmentation 4 1.3 Competition Dynamics 5 1.4 Development Trends 6 1.5 Financial Indicators 7 1.7 Appendix – Key Players’ Profile 8 – 10 2 StoxPlus Introduction 11 – 21
  3. 3. Page 3 Market Structure & Description Source: StoxPlus Home Care market in Vietnam is divided into 03 main segments: Laundry detergent, Dishwashing, Household cleaner and Bleach Figure 1: Vietnam detergent market structure, 2017 VIETNAM HOME CARE MARKET Laundry Care Dishwashing Detergent Household cleaner Bleach Surface care Toilet care • Detergent market occupied approx. 55% of total market size in 2017. While powder detergent remained the key product with over 91% detergent’s market size, liquid ones experienced high growth from low base with CAGR 2012-2017 of 32.8%, which is much higher than powder detergent’s figure (12.4%). • Unilever continued the lead with it flagship product, Omo (51.5% market share), followed by Ariel (4.7%) of P&G. Meanwhile, local players such as LIX only occupied about 1.5% market share. • In 2017, the market size of dishwashing segment reached VND2,854bn, equivalent to 8% of total market size. • Sunlight and My Hao are two most favorable brands with the market share of 55.9% and 31.2% respectively, in 2017. • This segment has been expanding at CAGR 2012-2017 of above 13% over the reviewed period, driven by income growth and improved living standards. • In the surface care segment, together Gift and Sunlight occupied 40% market share in 2017. Meanwhile, in the toilet care segment, Duck ranked the first place with 44% market share, followed by Gift (22%). Fabric softener • Fabric softener is gaining popularity in Vietnam in recent years • Comfort (Unilever) and Downy (P&G) dominated fabric softener market with total market share of 80% in 2017. • Bleach is the niche market with relatively small size of approx. VND115bn. Bleach faces fierce competition from laundry care products with strong stain removal ability, thus, the development of bleach is constrained in Vietnam. • Javel brand dominated the market with over 50% market share in 2017. Others
  4. 4. Page 4 Size & Segmentation Source: StoxPlus Compilation Laundry care remained its dominating position, contributing approx. 80% to the total market value Figure 2: Market size breakdown by segmentation, 2012-2017 Scale of 2017 (VND bn) Growth 2016-2017 CAGR 2012-2017 Laundry care 31,852 21.3% 16.7% Powder detergent 21,447 17.9% 12.4% Liquid detergent 2,353 24.5% 32.8% Fabric softener 8,532 30.3% 29.5% Dishwashing 2,854 9.8% 11.8% Toilet cleaner 770 12.2% 14.3% Floor cleaner 2,362 9.4% 12.7% Others 2,980 7.8% 9.2% TOTAL 40,819 18.5% 15.4% 0% 20% 40% 60% 80% 100% 2012 2013 2014 2015 2016 2017 Laundry care Dishwashing Toilet care Surface care Others • The value of the laundry detergent segment takes up around 78% of the home care industry in Vietnam. In the coming years, the laundry detergent segment is expected to prolong its dominating position with growth rate of 7.8% during the period 2017-2022. Notable trends in the laundry care segment include: ➢ Liquid detergent segment is expected to be the key growth driver with the highest CAGR 2012-2017 of over 30%, which was also recorded in other countries in Asia area such as China, Indonesia, Malaysia or Singapore. This could be explained by liquid detergent’s convenience and efficiency. In addition, consumers also prefer products, which is good for skin. ➢ Big pack size is preferred in rural area due to its relatively cheap price.
  5. 5. Page 5 Competition dynamics Unilever remained its dominant position throughout years thanks to its wide distribution network, marketing tactics, financial capabilities and management experience Figure 3: Market share by sales value in laundry care sector, 2017 • In 2017, Unilever still dominates Vietnam laundry care industry with 70% market share thanks to its wide distribution network, marketing strategies, financial capabilities and management experience. The company has over 150 distributors with a pool of more than 300,000 retailers nationwide. By localizing the management team as well as marketing strategies, the company has tailored made messages and campaigns suited for Vietnam consumers. Being the largest FMCG manufacturer, the strategy of Unilever is not only to adapt with the changes of consumers behavior but also to set new trends for the market. • It’s challenging for local companies to compete directly with two giants of detergent market as Unilever and P&G. To survive, there are 02 main strategies being applied by local firms: ➢ Becoming a contractor of Unilever and P&G ➢ Developing their own brand and distribution network. • In 2015, Unilever invested in a new factory in Bac Ninh to increase their own production capacity as Vietnam is seen as a promising market. Due to the low margin of manufacturing contract, local firms put effort to develop their own brand and distribution network, especially in rural areas with big pack size products. For instance, ABA brand (Dai Viet Huong company) concentratedly taps the economic class in rural areas, making it rank 5th in Consumer Reach Points index in this area. Additionally, the revolution of e- commerce players such as Shopee or Tiki assist local brands to penetrate niche market. Unilever P&G Vico Kao Viet Huong Lix Others Source: StoxPlus Compilation
  6. 6. Page 6 Development Trends Development trends of Detergents sector in terms of consumer behaviors, potential market and product development trend CONSUMER BEHAVIORS ✓ Working women: Women still do the majority of housework, even though the number of women working outside the home continues to grow. With busier lifestyles and rising income, consumers are willing to pay for premium products with convenient and effective feature, creating opportunities for concentrated products. Consumers are more concerned about how products protect their fabric and colors ✓ Bright lights, big cities: The proportion of urban population has been on the upward momentum from 28.9% (2008) to 35.5% (9M2018). For many consumers, urbanization means smaller storage space, which may increase demand for smaller package sizes, concentrated and multi-purpose products. POTENTIAL MARKET • In long term, rural areas are still the promising land for detergent products due to: ✓ Historical performance: In 2015, the detergent nominal value growth in rural area reached 6%, outperformed urban area’s figure with modest growth rate of 1%. ✓ Low penetration: The penetration rate of washing machines continues to increase over the forecast period thanks to increasing disposable income and higher coverage of consumer appliance retailers to rural areas. Therefore, demand for in-wash laundry care such as laundry detergents and liquid fabric softeners will remain consistent, while bar detergents (hand washing) will continue to experience decline. PRODUCT DEVELOPMENT • Premium products: As of 2016, premium detergent products contributed less than 30% of total category value. Consumers are willing to pay for premium products with additional feature (safe, organic, environment-friendly, hypoallergenic, etc.) • Packaging: Big packaging with relatively low price is preferred in rural area, which can be used for refilling purpose
  7. 7. Page 7 Financial Indicators Our Biinform portal provides ~ 1 million available company reports ready to purchase Figure 6: Selected financial indicators (US$ mn) of key players in detergent sector, 2015 Source: StoxPlus Note: The sales revenue takes into account all the business lines COMPANY KEY BUSINESS LINE TYPE SALES REVENUE COGS NPAT TOTAL ASSET OWNER’S EQUITY Unilever Vietnam International • Home care: Omo, Viso, Comfort, Surf, Sunlight, Cif, VIM • Personal care: Axe, Closeup, Dove, Lifeboy, Lux, Pond’s, etc. Foreign-owned >500 471.7 106.1 409.3 145.2 Saigon Co-op • Diversified Private >500 516.2 41.6 375.3 185.1 LIX Detergent • Home care: Laundry care, dishwashing liquid, floor cleaner, toilet cleaner • Personal care: Shower gel SOEs 50-100 61.4 8.1 35.1 20.1 Vico • Home care: Laundry care, dishwashing liquid, floor cleaner, toilet cleaner, bleach, glass cleaner, multipurpose cleaner, mostly branded “Vi Dan” and “Vico” • Personal care: Shampoo, shower gel, hand wash, soap branded “Orian”, “Waha”, and “Luson” Private 25-50 36.0 1.5 28.3 5.2 Kao Vietnam • Personal care: Cleansing products, Shower gel, & sunscreen named “Bioré” • Home care: Powder & Liquid detergent branded “Attack” • Tampon and diaper branded “ Laurier” & “Merries” Foreign-owned 25-50 26.7 -3.5 19.3 12.3 My Hao Chemical Cosmetics • Home care: Laundry care, dishwashing liquid, bleach, glass cleaner branded “My Hao”, “Siusop”, and “Ring” • Personal care: Shower gel, shampoo, perfume, soap Private 25-50 31.3 3.3 10.7 8.9 S.C. Johnson & Son (Vietnam) • Household cleansing brands: Pledge, Duck, MrMuscle Foreign-owned 25-50 13.0 -1.2 6.3 -2.0 Saraya Greentek • Diversified Private <25 0.7 0.1 0.5 0.3
  8. 8. Appendix| Key Players’ Profiles • Registered name: Unilever Vietnam Company Limited • Head office: Lot A2-3, Tay Bac Cu Chi Industrial Zone, Tan An Hoi Commune, Cu Chi District, Ho Chi Minh City, Vietnam • Establishment Year: 1995 • Principal businesses: Unilever is the leading FMCG company in Vietnam. The company’s business focuses on 03 main segments including home care, personal care, and food & beverage. Some of Unilever’s most well-known brands in home care sector include Ome, Comfort, Viso, Sunlight, Cif, Surf, and Vim. COMPANY PROFILING FINANCIAL PERFORMANCE COMPANY POSITION KEY PRODUCTS & BUSINESS STRATEGY Unit: US$mn 2014 2015 2016 2017 Net sales 1,004.4 CoGS 490.5 Gross Profit 513.8 % Gross Profit(*) 47.3% NPAT 92.7 % NPAT (*) 8.5% Total Assets 403.0 Total Liabilities 133.8 ROA (*) 23.0% ROE (*) 69.2% HOME CARE • Omo • Comfort • Sunlight • VIM PERSONAL CARE • Sunsilk • Dove • Pond • P/S OTHERS • Real estate • Chemicals • Livestock The company have a widespread contribution network of over 150 distributors and 300,000 retail stores. With regard to laundry detergent, Unilever offers customized products for different customer classes: OMO – premium product; Viso and Surf – economic product. No Plant Location Products 1 HCMC plant HCMC • Home care • Personal care • Food 2 Bac Ninh plant Bac Ninh Province • Home care 3 Cu Chi plant Cu Chi North West Industrial Zone, Cu Chi • Home care • Personal care Content to be removed for demo purpose
  9. 9. Appendix| Key Players’ Profiles • Registered name: Dai Viet Huong Joint Stock Company • Head office: 111 Nguyen Trai Street, Ben Thanh Ward, District 1, Ho Chi Minh City, Vietnam • Establishment Year: 1992 • Principal businesses: Dai Viet Huong Company (formerly known as Viet Huong Cosmetics) was established in 1992 as a cosmetics company. IIn 2012, the company marked its entry into the detergent sector by launching a brand new laundry powder product named Aba, directly compete with the 2 industry giants namely Omo and Ariel. Despite being a relatively new brand, Aba quickly ranks at No. 3 in the market, and became the core business of Dai Viet Huong. COMPANY PROFILING FINANCIAL PERFORMANCE PRODUCTION SITES KEY PRODUCTS & BUSINESS STRATEGY Unit: US$mn 2014 2015 2016 2017 Net sales 77.08 CoGS 68.31 Gross Profit 8.64 % Gross Profit(*) 11.23% NPAT 3.61 % NPAT (*) 4.69% Total Assets 27.73 Total Liabilities 16.05 ROA (*) N/A ROE (*) N/A No Plant Location Products 1 Vinh Long Plant Vinh Long Province • Personal care • Home care LAUNDRY CARE • Aba • Junco PERSONAL CARE • E100 • Biona • Doreen • Ramus OTHERS • N/A Dai Viet Huong position its Aba brand in high price segment. In addition, the company often offer attractive discount policies such as 15-20% discounts while multinational rivals only offer 10% limit . With the advantage of low production cost, high selling price, the company has a large profit margin which is reinvested in distribution systems and promotion to to gain market share. Content to be removed for demo purpose
  10. 10. Appendix| Key Players’ Profiles • Registered name: Daso Company Limited • Head office: No. 35 Binh Duong Boulevard, Thuan Giao Ward, Thuan An Town, Binh Duong Province, Vietnam • Establishment Year: 1988 • Principal businesses: Daso Group, initially Nha Rong cosmetics JSC, is a 7-member corporation, operating in many fields such as chemicals, cosmetics, food & beverage, livestock and real estate. In the The company chemical segment, the company is mostly known for its detergent product line namely Daso Laundry Powder. COMPANY PROFILING FINANCIAL PERFORMANCE PRODUCTION SITES KEY PRODUCTS & BUSINESS STRATEGY Unit: US$mn 2014 2015 2016 2017 Net sales 0.23 CoGS 0.24 Gross Profit (0.01) % Gross Profit(*) (6.98%) NPAT (0.04) % NPAT (*) (18.92%) Total Assets 11.72 Total Liabilities 10.67 ROA (*) N/A ROE (*) N/A No Plant Location Products 1 Daso Co., Ltd Binh Duong • Detergent • Home care • Personal care 2 Daso JSC Hai Phong • Sodium silicate Laundry care • Detergent • Home care 3 Delta Beverages Co., Ltd Long An • Milk • Fruit juice 4 Binh An Vegetable Oil JSC Binh Duong • Cooking oil DETERGENT • Daso (Laundry powder, fabric softener & dishwashing) • Javel JUICE • Delta OTHERS • Real estate • Chemicals • Livestock Daso company positioned its Daso detergent brand in the low to middle income segment. Its supermarket partners are Co.op mart, Maximark and Metro. Although it was one of the well-known domestic brands, after foreign brands such as Omo and P & G entered the market and as the living standard increased , the company lost ground and failed to catch up with its giant rivals’ financial and strategic resources as well as to have an appropriate image change. Content to be removed for demo purpose
  11. 11. Page 11 Table of Contents No Contents Page 1 Vietnam Detergent Market Preview 2018 2 – 13 1.1 Market Structure & Description 3 1.2 Size & Segmentation 4 1.3 Competition Dynamics 5 – 7 1.4 Financial Indicators 8 1.5 Development Trends 9 1.6 SWOT Analysis 10 1.7 Appendix – Key Players’ Profile 11 – 13 2 StoxPlus Introduction 14 – 24
  12. 12. Page 12 Overview • Date of incorporation: March 11, 2008; • Legal representative: Mr. Nguyen Quang Thuan • Number of staff: 80 (as of April 2018) including Data Analysts, Market Analysts, IT Engineers and Product Developers. • Charter capital: VND24 billion (US$1.1 million); Shareholders: NIKKEI: 17.55%; QUICK: 17.55%; Management and other: 64.9%; • Two offices: Hanoi Head Office and HCMC Branch StoxPlus is a pioneer and a Vietnam’s leader in financial and business information services since 2008 Leveraging on our financial and corporate database we provide, on the order basis, research services by our professional team with local insights and international experience: • Industry Report • Customized research • Commercial Due Diligence • Market Entry Consulting • Business matching and Support We offer below products leveraging on our comprehensive financial database: • FiinPro Platform: financial database for professionals covering equity, industry and economic data and analytic tools • FiinTrade Platform: the first comprehensive information platform for trading into Vietnamese stocks • Securities Datafeed: via API or XML StoxPlus Joint Stock Company We offer below products on-the-shelf and by order basis by leveraging on an aggregated source of more than 1 mil+ Vietnamese companies: • Company Report: from basic profile, factsheet, credit report to comprehensive research reports. Financial Information Research & Consulting Business Information
  13. 13. Page 13 Board of Directors and Management Our Management have extensive and diverse experiences in information, technologies & related services Thuan Nguyen, FCCA Chairman and CEO Co-founder of StoxPlus previously working as an investment manager of Vietnam Holding Asset Management Ltd and manager at PwC Vietnam & Australia Hieu Nguyen, MBA Vice Chairman Co-founder of StoxPlus previously working as a specialist at the Department for International Development of UK (DFID) in Vietnam. and Consulting Manager at PwC Vietnam Yoichi Noor Iwamoto Board Member Representative of NIKKEI Inc. at StoxPlus. He is currently Managing Director of NIKKEI CHINA (Hong Kong) Ltd. Chiharu Kawai Board Member Representative from QUICK Corp at StoxPlus. He is currently General Manager of Global Business Department at QUICK Corp. Bolat Duisenov Board Member CEO of Kusto Group Vietnam – a private equity fund with AUM of US$300M operating in Vietnam. Huy Mac, CFA, FCCA Board Member A well-known financier with Lehman Brothers and KPMG. Recently he was CEO of KB Securities (Vietnam) and ex-DCEO of MB Securities. Dong Le, CFA Director, BiinForm Previously Senior Investment Manager at BIDV-Vietnam Partners Investment Management and audit manager at Deloitte Vietnam Trang Truong, MBA Managing Director, FiinForm Managing Financial Information Unit of StoxPlus and lead business analyst for innovative product development at StoxPlus Tung Do CTO Oversight technology and product development at StoxPlus. Previously various managerial position at IT Outsourcing firms including CMC and EKGIS
  14. 14. Page 14 Research and Consulting Services • Leveraging on industry and corporate database, we offer insightful industry reports for Vietnam. • Our Analyst team cover around 20 key sectors of Vietnam and offering reports ready to use in the portal or in an order basis Industry Report A selection of sectors we cover: Consumer Finance Cement PET Packaging Healthcare Services Banking SOEsLogistics Flexible Packaging Fertilizer Food & Beverage
  15. 15. Page 15 Our advantages in database business make us differentiated from other international vendors Research and Consulting Services VCCI Trade Associations StoxPlus Data Exchanges Self–contribution General Statistics Office Credit Information Centre Stock Exchanges Ministries (MOF, MOIT) Banks Chambers of Commerce Local Market Insights Biinform Database Data Cleaning up and Validation • Database of~1 million businesses registered in Vietnam • Company profiles, Ownership and financial data • All types of enterprises: JSC, LTD, FDI, SOE … • All key industries of Vietnam
  16. 16. A Global Standard: International Corporations Client CONSUMER FINANCE CEMENT OTHERS Research and Consulting Services
  17. 17. Page 17 Research and Consulting Services • When the information standard reports is not sufficient nor available, we customize our report to specific requirements by clients plus value added services including presentation, company visits, or business matching. • The scope is more in-depth research tailored to clients’ specific segments of interest with insights input by industry experts. We have a team of seasoned and experienced consultants for customized research assignments and market entry consulting projects. We provide comprehensive analysis and local insights to our clients at quality standards of the world’s prestige advisory firms Market Research • We support investors to explore investment opportunities and define market entry strategies into Vietnam. • Our market entry services range from market due diligence, partner screening, to business set-up. We support clients who are penetrating into Vietnam by either M&A, Equity Investments, Foreign Direct Investments or simply business alliance with domestic enterprises. • Actionable recommendation for clients’ entry strategies, including advisory on all stages: • Market assessment • Business Intelligence • Investment Screening • Trade Connection Market-entry consulting
  18. 18. Page 18 Research and Consulting Services We differentiate our services by leveraging on our Corporate Database; Industry Database and Local Market Expertise with down on-the-ground surveys and a network of industry experts Local Market Insights Biinform Database International Experience RESEARCH SPECIALISATION SURVEY/IN-DEPTH INTERVIEWS WITH LOCAL INSIGHTS NETWORK OF INDUSTRY EXPERTS COMBINATION OF TOP DOWN AND BOTTOM UP APPROACH • Professional teams with experience in market research/due diligence for water & utility • Track records with prestige customers (both fund and industry players) • Most updated industry database (incl. water sector) We put strong focus on developing network of experts who are C-level personnel in the industry. This expert network will be fully utilized for this project. Gaining market intelligence via in-depth interviews with: • Market players • Industry experts • End-use sector players • Policy-makers The advantage of understanding appropriate approaches to generate insights is leveraged. A thorough approach for the project is applied. Demand estimation from end-use industry and industry landscape from industry players will be both included. • Combination of hard data leveraging Biinform database and local insight (track record, expertise & network) • Database of all Vietnam Water Companies (production data such capacity, key operational indicators)
  19. 19. Research and Consulting Services We have a great track record in supporting large local and foreign clients from Day 1 when they first come into Vietnam Page 19 JAPAN FINANCIAL SERVICES OTHER INDUSTRIES KOREA WESTERN COUNTRIES OTHERS
  20. 20. Research and Consulting Services We are proudly making contribution to capital and trade flows within Vietnam and between Vietnam and the World via our product and services; and also via various conferences and industry seminars providing thought leadership about Vietnam market Speaking at Cemtech Asia 2015, 2016, 2017 Annual Consumer Finance Conference, co-host with SBV 2016, 2017 Annual Foreign Investor Conference, co-host with HOSE M&A Seminar, co-host with Singapore Business Group, 2017 SME Financing Conference, 2017 Trade Risk management Conference, co-host with CIC, 2017 FiinPro Talk Series (quarterly) Vietnam Renewable Energy Conference, co- host with Eurocham, 2018 Page 20
  21. 21. Contact us at StoxPlus Nguyen Thi Huyen Trang Senior Associate, Client Service Advisor t: +84 (28) 3933 3586 e: Head Office 5th Floor, Anh Minh Building 36 Hoang Cau Street Hanoi, Vietnam + 84 (24) 3562 6962 Ho Chi Minh City Branch 3rd Floor, Profomilk Plaza Bldg 51-53 Vo Van Tan, District 3 Ho Chi Minh City, Vietnam + 84 (28) 3933 3586 For Financial Information Services For Business Information Services For Research and Consulting Services Le Xuan Dong, CFA Director, Research and Consulting t: +84 (24) 3562 6962 (ext. 110) e: Nguyen Anh Tuyet Manager, Client Service Advisor t: +84 (28) 3933 3585 (ext. 208) e: