Rising demand for imported quality confectionery products have led to growing investments from foreign players.
One such player is Korea’s Lotte Confectionary which had opened its 2nd factory in Binh Duong in February at an investment of US$21 million to produce choco pies under the Chocolat brand. Lotte will also be upgrading its 1st chewing gum factory.
Orion Food Vina (OFV), the producer of popular ChocoPie snack, is also investing US$59 million on a new production line in 2023, after reporting record revenue of US$400 million in Vietnam. It currently has 32 production lines churning out 84,000 tonnes of products annually from ChocoPie to cookies, rice snacks and candies among others.
Recently, Thai-based snack producer, Variety Foods International has also strengthened its distribution by partnering with Thai Corp International Vietnam to boost its sales of Mix biscuits in the country.
Meanwhile, Japanese-based confectionery player, Morinaga engaged DKSH in 2020 to drive the sales of its Dars chocolate and Hi Chew candy in Vietnam.
The consistent growth in this segment has continued to attract investments by foreign players. Euromonitor Plc has confirmed that the snacks and confectionery segment will continue to maintain decent growth in the next 5 years in line with the country’s economic growth. One major challenge however is adjusting to changes in the buying patterns in the country, as snacks and confectionery are considered non-essential products, amid rising inflation.
Nielsen has ranked Vietnam as one of the Top 3 fastest growing snacks markets in Asia. Foreign players can gain tremendous success if they are able to constantly innovate and launch products that cater to local consumer tastes and lifestyles. In addition, it is important for players to maintain good control over operational costs while undergoing expansion.