(Dân trí) - Masan Consumer is set to develop a new FMCG model, focusing on the "out-of-home" product category. Meanwhile, WinCommerce aims to open 400 to 1,000 new stores and achieve profitability by the first quarter of 2025.
High Expectations for the "Point of Life" Model
On the morning of April 25, Masan Group Corporation (Masan Group - MSN), Masan Consumer Corporation (MCH), and Masan MEATLife (MML) held their annual general meeting of shareholders for 2024.
Discussing the 2023 business figures and plans for 2024, Mr. Danny Le, CEO of Masan Group, stated that while 2023 was a challenging year, WinCommerce still managed to expand its retail channels and effectively penetrate new markets.
In 2019, when Masan took over this chain, it was still operating at a loss. However, after four years, CEO Danny Lê considers the results very encouraging. According to the plan, the WinCommerce system aims to open 4,000 stores, with the goal of 90% reaching EBITDA breakeven. In the first quarter of 2024, driven by recovering demand, the chain has been opening 1.6 stores per day with the target of 75% achieving EBITDA breakeven.
Mr. Danny Lê places high expectations on the "Point of Life" model, stating, "We have all the necessary pieces to modernize the retail channel in Vietnam, including strong brands, a network of stores, and our own logistics system."
Launching Self-heating Rice, Masan Consumer Plans to Build a New FMCG Model
According to Mr. Truong Cong Thang, CEO of Masan Consumer, MCH has expanded from kitchen products to items found in the refrigerator, living room, and bathroom. Currently, MCH boasts 5 major brands - Chin-Su, Nam Ngư, Omachi, Kokomi, and Cafe Wakeup 247 - each generating $150-250 million in revenue. The company's new goal is to establish six big brands, each with revenue reaching $1 billion. These brands include Chin-Su, Omachi, Cafe Wakeup 247, Vinacafe, Chanté, and Tea 365.
MCH identifies "out-of-home" products such as tea, coffee, bottled water, self-heating hot pot, and snacks as one of the company's five new pillars. "Over the past 20 years, we have established a strong presence in households, but with new consumer trends, the out-of-home market is where we are heading," said Mr. Thang.
"The average annual growth rate of MCH is 14%, which is double the growth rate of local companies in Southeast Asia. Consumers can purchase an MCH product within just five minutes, and the probability of finding a Masan product in a Vietnamese household's kitchen, bathroom, or refrigerator is 98%. We project that the sales of our current products could reach $1.5 billion in Vietnam, but this only accounts for 8% of the consumer spending budget, significantly lower than leading companies in other markets," said Mr. Thang.
MCH's CEO also highlighted that the current FMCG market served by MCH is valued at $8 billion, while the total market size in Vietnam is $32 billion. Consequently, MCH has decided to build a new FMCG model with a strategy to develop six billion-dollar brands. This aims to ensure consumer safety when purchasing products, promote Vietnamese big brands and cuisine globally, and showcase the allure of Vietnamese culture and cuisine to the world. The goal is for Masan Consumer to rank among the top in Southeast Asia in terms of revenue and profit.
Regarding the revenue and profit strategy, Mr. Thang emphasized seven key points: focusing 80% of the marketing budget on creating new demands and added value to expand big brands, bringing world-leading technology to Vietnam, developing AI-driven approaches, fully digitizing operations, implementing a new Go Global business model, creating synergistic supply chain value with WinCommerce, The CrownX, and Supra, and building a team of young, passionate leaders with strong qualities.
At the conference, MCH also launched a new product: self-heating rice, priced between 100,000 and 150,000 VND per unit. This product is seen as a crucial step in "premiumizing" Omachi's offerings, propelling the brand to the billion-dollar mark and aiming to expand the instant noodle market from $1 billion to $17 billion.
WinCommerce to Open 400-1,000 new stores, revamps Price Strategy
Ms. Nguyễn Thị Phương, CEO of WinCommerce, announced that the system's revenue reached 30 trillion VND in 2023 and is projected to increase to 33 trillion VND in 2024. The mini mart chain, which accounts for 75% of the revenue, doubled its sales from 2019 to 2023, with over 2,000 stores achieving EBITDA profitability (nearly ten times the number in 2019).
WinCommerce's primary focus is to change its product strategy and address customer perceptions of high prices at its stores. Since the end of 2023, WCM has revamped its pricing strategy, communicated pricing changes to customers through in-store staff, and promoted these changes via digital platforms. In rural markets, WCM has even introduced products that can compete on price with external stores.
"By the end of 2024, WCM's pricing image will be completely transformed," Ms. Phuong stated, adding that the system aims to open 400 to 1,000 stores, depending on market conditions. WCM aims to achieve positive post-tax profits by Q1 2025.
By 2028, the system is expected to double its 2023 revenue to 60 trillion VND and expand to 8,000 stores. The successful B2B and B2C models will include 70,000 stores, not accounted for in this revenue.
"Why are we confident about this market? Because Masan has the winning points: being one of the nationwide retailers with a winning model, having designed successful models for both urban and rural markets, and possessing a platform that connects with and understands consumers," she explained.
"We also own and operate the supply chain to enhance delivery efficiency from warehouse to store; we have curated a product portfolio suitable for each customer segment; and we invest in technology with the philosophy that only technology can drive rapid growth. The market potential and opportunities remain vast, and Masan has a leading ecosystem in Vietnam, encompassing production, supply, and retail, which creates a significant advantage," Ms. Phuong explained.
In the latest report, HSBC's analysis team maintained their buy recommendation for Masan Group's stock, raising the target price from 91,000 VND to 98,000 VND, which is 46% higher than the current price. Vietcap also issued a buy recommendation for MSN stock, expecting the price to reach up to 89,700 VND.
