Vietnamese products compete in Cambodia

photo: vietnewsonline

Vietnamese products now have good opportunities to expand in Cambodia, as consumers there tend to choose Vietnamese products over those from Thailand and China.

Vietnamese products now hold the second largest market share in Cambodia after Thailand. 400 Vietnamese businesses, most of whom specialise in trade, finance or manufacturing, have invested in the country.

Vietnam’s major exports to Cambodia include instant noodles, plastic products, tobacco, confectionery, seed corn, household products, and vegetables, while it imports materials for textiles and garments, automobile parts, timber and rubber.

Bilateral trade turnover has been rising by about 40 percent every year, totalling US$1.7 billion in 2008. It is expected to reach US$2 billion in 2010. Export turnover sees a much greater increase than import.

The overall worth of Vietnamese products consumed in Cambodia reached US$988 million, surpassing products from China and Thailand. The nine products with the biggest turnover include steel for construction, agricultural machinery, fertilizer, plant protection chemicals, household products, processed agricultural products, dairy products, seafood and re-exported petrol.

According to Cambodian businesses, in terms of quality and prices, Vietnamese products are in no way inferior to Thai products. Some food products are even fresher when arriving in Cambodia due to the shorter distance from Ho Chi Minh City to Phnom Penh.

A delegation of experts from the Business Studies and Assistance centre (BSA) and Business Studies Center of the Sai Gon Tiep Thi newspaper recently came to Phnom Penh and Battambang and surveyed 500 retailers to study the competitiveness of Vietnamese products versus Thai and Chinese products.

The survey includes 3 stages, the first of which began in May. During this stage BSA has studied the business environment and policies and interviewed successful Vietnamese distributors in Cambodia.

The results show that Vietnamese products in the Cambodian market are cheap and their quality is acceptable. Vietnam has built the trademarks of a number of high-quality products which have become quite popular in Cambodia.

By contrast, Cambodian people have recently become cautious about substandard products originating from China.

In fact, Chinese products have not yet been much sought after in this market, while Thai products are beyond the reach of most Cambodian people.

According to Truong Cung Nghia, Director of the Truong Doan Market Research Company, Vietnamese products are not nicely packaged as Thai products and even have no desciption in Khmer language.

In addition, Vietnamese trademark advertising is failing to create a strong impression on Cambodian customers and secure a foothold for Vietnamese products in the Cambodian market.

Experts say that to penetrate the Cambodian market, businesses should establish a distribution network for export products, promote the advertisement of Vietnamese trademarks, ensure business prestige and introduce more products to Cambodian retailers. If new products are introduced, customers should be allowed to sample these products. Currently, a number of Vietnamese entrepreneurs are keen on setting up new businesses in Cambodia to distribute their products to Cambodian consumers.