상품DB/베트남 위생도기 시장동향(2014.4)/DEMAND TREND/SANITARY WARE MARKET IN VIETNAM/COMPETITION TREND

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제목	베트남 위생도기 시장동향(2014.4)
게시일	2016-03-15	국가	베트남	작성자	김주선(하노이무역관)
품목	기타
품목코드	690890
작성일자: 2014.4.23 작성자: 하노이 무역관 Nguyen Hanh Linh(Linhkotra@gmail.com) 1. DEMAND TREND □ Demand trend in Vietnam  ○ Vietnam’s population is 85 millions, of which 80% is at working age. Urban area rate of Vietnam is around 10.2㎡/person that is much lower than the world rate of 20-25㎡/person.                        Source: General Statistic Office  ○ Moreover, Vietnam’s real GDP annual growth eased from 5.9% in 2011 to 5.0% in 2012 – the slowest rate since 1999. The industry sector, including construction, which represented 42% of the total GDP in 2012, rose by 4.52% annually. Vietnam’s economy is expected to grow by 5.3% and 5.7% annually in 2013 and 2014 respectively, and accelerate further to around 6.5% during 2015−2017. The growth is expected to be supported by a reduction in interest rates and improvements in export demand. The figures show that demand for housing is huge.               Source: General Statistic Office □ Construction industry in Vietnam  ○ Though the figures show great demand, in reality, Vietnam’s economy has undergone an extended period of insubstantial expansion, due to decelerated growth in the real estate sector, a banking system characterized by non-performing loans (NPLs) and a property market slump.  ○ A property slump following the global financial crisis and a banking system struggling with an increasing share of NPLs has led to a situation of rising real estate inventory, falling property prices and many large residential construction projects being put on hold due to difficulties in obtaining credit.  ○ Investors facing financial problems are trying to sell off as many properties as possible to increase sales. Despite house prices declining during 2008−2012, buyers are reluctant to invest as they expect prices to decrease even further. It is thought that prices bottom out by the end of 2013, and a recovery is expected thereafter.  ○ In other words, Vietnam's construction sector is in an upward cyclical phase, as evidenced by a real growth rate of 5.3% YoY in the first nine months of 2013. The trend is believed to continue in 2014. Easy monetary conditions and greater investment interest from foreign sources in Vietnam's construction sector is likely to support growth for the year.  ○ Furthermore, the government continues its efforts to restructure state-owned enterprises and improve its business environment, both of which would level the playing field, free up public funds and improve profitability, and help to attract additional investment for infrastructure development over the coming years.  ○ In November 2013, the Vietnamese government approved an amendment in its Land Law. The revised legislation, which will come into effect on July 1 2014, is aimed at limiting land disputes by prohibiting the government from appropriating land for socio-economic development unless such projects have been approved by the prime minister and the Vietnamese parliament. It is believed that this revision is a major step in strengthening the regulatory framework and will increase transparency for projects that are implemented under the direction of the provincial government. It would also help reduce the risk of project delays which have been caused by long and costly disputes over compensation. 2. SANITARY WARE MARKET IN VIETNAM □ Overview of Sanitary market  ○ Attaching to construction industry whose annual growth is 40% to 50%, sanitary ware market is a potential one and is now experiencing a promising change. With the participation of a variety of brands including foreign brands namely TOTO, INAX, Ceasar, American Standard and local brands namely Viglacera, Thien Thanh, Pincenza, the sanitary ware market is very diversified.  ○ Some years ago, Vietnamese customers tended to prefer imported brands. Imported products were always displayed at front areas and easily found when consumers entered the shops. However the trend has been changed. Products of foreign brands manufactured in Vietnam are preferred nowadays since their quality and price are totally competitive. INAX, TOTO and Ceasar become the most favorite brands in Vietnam. TOTO, a luxury brand, is considered to rank the first for quality and is the brand for high end users while INAX, American Standard and Ceasar target on mid segment. □ Market share  ○ With the capacity of 3,000,000 products per year and the reasonable pricing, INAX is now the biggest shareholder of 30% of sanitary ware market. It is followed by American Standard and Ceasar with the market share of 19% and 17% respectively thanks to their price policy. TOTO owns 12%, ranking the 4th since. Viglacera is the biggest local manufacturer with the market share of 10%. Market share of sanitary ware                            Source: Ministry of Construction (MOC) 3. COMPETITION TREND □ INAX:  ○ INAX Vietnam was established in Hanoi in 1996 as a joint venture between INAX Corporation (Taiwan) and 2 state owned companies, possesses 7 factories with the capacity of about 3,000,000 products every year. In August 2008, INAX put the 4th factory into operation and reach the capacity of 4 factories of 2,000,000 products per year. And by now, possesses 7 factories with the capacity of about 3,000,000 products every year. INAX becomes the biggest manufacturer of sanitary ware not only in Vietnam but also Southeast Asia with the market share of 30% in Vietnam. Besides, INAX owns a strong distribution system of over 4,000 retailers over the country. □ TOTO:  ○ In Vietnam market, TOTO products were first imported to Vietnam over 30 years ago. Its products are highly appreciated by most of retailers and constructors, architect and rich people. It is considered as the most luxurious brand in the industry with the best quality. In 1995, TOTO opened its representative office in Vietnam to carry out activities of promoting business and researching market to prepare for factory in Vietnam.  ○ From June, 2004 TOTO officially opened a factory in Thang Long Industrial Zone – Hanoi. The factory is in stage 1 with total capital of 27 million USD and design capacity of 500,000 products/year. 30% of sanitary ware products manufactured from this factory are sold in domestic market and 70% of that is exported, including 50% to Japan and 20% to US. In 2005, TOTO invested for 2 factories in Vietnam with capacity of 750,000 products/year and with capital of 48 million USD. It also plans to build one more factory with total capital of 18 million USD to produce bathroom fittings if the market is stable.  ○ TOTO’s growth rate has been announced as 20% to 25%. □ American Standard (AS):  ○ As is the biggest manufacturer of sanitary ware in the world with many factories and representative offices in different countries, its brand was known by consumers in the South of Vietnam before 1975. AS invested to Vietnam from 1994 and set up a joint venture in Binh Duong (in the south of Vietnam). 2 years before the factory coming into operation, AS imported products from Thailand and built distribution network to sell in Vietnam, and quickly conquered the market thank to its good quality, nice design compared to the one made by local manufacturers. The factory in Binh Duong had total capacity of 300,000 products per year and was raised to 500,000 products per year in 2005.  ○ Although owning a famous brand, strong support from mother company, and having a bigger products lines from beginning, AS has quickly lost market share to other firms such as Caesar and particularly INAX. AS has undergone over-stock for several times, leading to special discount of 20 to 30% to reduce stock. □ Caesar:  ○ Caesar is the second biggest manufacturers in Taiwan. It has been to Vietnam since 2001. Caesar’s factory with total capacity of 300,000 products per year officially launched products for the first time in 2002. Compared with other firms such as INAX, TOTO and AS, Caesar is considered weaker in terms of brand prestige, experience and technology. However it is very flexible in business and price is very competitive compared to other foreign brands. One more disadvantage that Caesar has to coop with is its origin of Taiwan. Products made in Taiwan are not appreciated by high-income Vietnamese consumers.  ○ Understanding the market and consumers’ behaviors in Vietnam, Caesar has applied suitable strategies to penetrate the market and obtained good results. Its targeted markets are provincial ones where people do not have high income and do not require for well known brands of high quality. With only around 15-20% higher price compared to Viglacera’s, it has conquered a considerable market share from Viglacera, Cosevco and Thien Thanh. Its market share has rapidly increased in their targeted market.  ○ In 2006, Caesar expanded its product line to raise production capacity to 500,000 products per year. And at the same time it invested in activities of new product development.  ○ Outstanding point of Caesar is the diversification of product design of every product line. Caesar currently has 12 product lines with 6 different colors. It has launched products at different price ranges, offering various options for customers. □ Viglacera:  ○ Viglacera is a local brand. Established since 1974 with 35 years of development, Viglacera transformed from a traditional brick and ceramics manufacturer to become a state owned multi-sector group leading in the field of building material production in Vietnam and having bold step forward in the field of infrastructure development, industrial parks, residential and business properties.  ○ Its 3 sanitary wares and fitting companies producing total capacity of 1.3 million products / year. Viglacera targets on lower income customers, particularly provincial households. 4. PRODUCTION TREND  ○ Most of foreign brands’ products are manufactured in Vietnam under the foreign technology, including TOTO, INAX, Ceasar and American Standard. They invested and built different factories in different cities of Vietnam, producing a wide range of products to introduce to market.      Source: Manufactures’ websites  ○ Advanced technologies have been applied among foreign brands.   - TOTO: Tornado flush (highly effective triple-jet toilet flushing system), Cefiontect (hygienic glaze that creates smooth ceramic surfaces), Gmax (high-performance flushing system), Washlet (Unique wand system that uses warm water to cleanse)   - INAX: Hyperkilamic (avoiding dirt created by bacteria, cleansing the surfaces), Proguard (preventing water from attaching to the surface to form smear)   - Ceasar: Nanometer coating technology (making the anti-dirt molecular fill the rugged porcelain surface, to form a film so that dirt and moisture cannot attach easily, but water bead can slide rapidly); FFC technology (making extra-large products with large surface area, wear-resistant and no crack)   - American Standard: Electronic Seat & Cover (allowing the seat to be warmed, the controller is pushed so that a cock could be exposed and the water jet will aim exactly on the required place gently and cleanly, then tap water will automatically withdraw) 5. RETAIL PRICE TREND  ○ Sanitary ware price has been in the upward trend since the beginning of 2013 when the market showed the signal of recovery. Sanitary ware price is also strongly affected by gasoline since the gasoline’s price rises, leading the prices of in-come materials and transportation to rise. The most recently that Sanitary ware price was adjusted is August 2013 when a series of manufactures including INAX, TOTO and raised the price manufacturers often carry out a variety of promotion programs during June to promote sales. Retail price range of Ceramic Sanitary ware Products         Unit: USD (excluding VAT ~ 10%)        Source: Manufacturers  ○ In terms of price, TOTO ranks the first, followed by American Standard and the 3rd are INAX and Ceasar.  ○ Viglacera, Thien Thanh and Pincenza, local brands, are perceived as cheap brands. Low price is advantage of the local brands. However they are competed more and more by floating Chinese products with diversifying designs but uncontrolled quality. 6. DISTRIBUTION  ○ In Vietnam, sanitary ware manufacturers sell products to end users through their dealer system. Dealer systems of big brands such as TOTO, INAX, Ceasar and Viglacera cover all provinces of Vietnam. To become official dealers of these brands, retailers have to meet some certain requirements by manufactures. They also have showrooms in big cities such as Hanoi, Haiphong Quang Ninh (in the North); Hochiminh City, Da Lat (in the South) and Da Nang, Quang Ngai (in the Central) to promote their brands and introduce products to customers.  ○ Big sanitary ware manufacturers also have other distribution channel reach projects and construction buildings with representative offices in the 3 areas of Vietnam. 7. IMPORT TARIFF        Note: MFN: Most Favored Nations (Korea belongs to this group of nations)                AKFTA: ASEAN – Korea Free Trade Agreement                (*) Between two different preferred tariffs, the lower one would be applied        Source: Book on Export – Import Tariff 2014 (Ministry of Finance)