However, in China, it is not expected to perform as good due to tepid demand amid pandemic restrictions in the country. According to an industry analyst, Orion is expected to record 10% growth in sales in Korea, 15% in Vietnam, 20% in Russia, but only 0.4% growth in China.
In Vietnam specifically, its subsidiary Orion Food Vina (OFN) is expected to lead sales in Vietnam’s confectionery industry in 2022 with a record revenue of US$400 million. Its ChocoPie products accounted for 66% of the pie market in Vietnam, according to Nielsen survey. OFN is far ahead of its domestic competitors, Bibica and Hai Ha which reported sales of US$68 million and US$64 million respectively.
The main reason for OFN success in Vietnam is its localisation strategy of meeting consumer demand from initially producing ChocoPie to later diversifying into other products like cookies, custard and candy products to meet local tastes. It also employs mostly locals, and maintain its product prices since 2018 despite the 70% jump in ingredient costs.
As part of its expansion plan, OFN plans to invest Dong 1.4 trillion (US$59.4 million) to build a new production line, in addition to its 2 existing plants in Binh Duong and Bac Ninh provinces.
OFN eyes 10-15% growth annually from 2022 to 2025. This is achievable as Vietnam confectionery market is projected to grow at 7% annually to reach Dong 66 trillion (US$2.8 billion) in 2025. Vietnam per capita consumption of confectionery stands at 2kg, still lower than global average of 3kg.
