The Vietnamese beer market – Focus

Heineken’s management team has been in Vietnam this week for the company’s annual Financial Markets Conference. CEO Jean-François van Boxmeer called the country the “poster child” for international beer thanks to its strong demographics and growing demand. Here’s a snapshot of Heineken’s current position in Vietnam and how the market is developing, as outlined by Heineken’s Vietnam MD, Leo Evers. To read a similar low-down on Asia-Pacific, click here.

Vietnam’s beer basics

• Beer market is 38m hectolitres while per-capita-consumption is 41 litres, one of the largest in Asia-Pacific
• Beer accounts for 94% of total alcoholic consumption, and represents 31% share of the total beverage market
• In the past four years, beer volumes have grown at an average of 4.7% per year
• In the next three years they are forecast to grow by 4.8% according to Canadean
• Vietnam is Heineken’s second largest profit contributor, accounting for 10% of global operating profits and 50% of Asia-Pacific’s

Vietnam’s beer industry

• The market is consolidated at a regional level
• Hanoi Alcohol Beer & Beverage Corp (Habeco) operates mainly in the north of the country, where it holds a leading market position
• Vietnam Breweries (Heineken), Saigon Beer Alcohol Beverage Corp (Sabeco) and Hue Brewery (Carlsberg) are the key players in Central Vietnam
• In a limited IPO in 2007, Heineken acquired a 5% stake in state-owned Sabeco
• South Vietnam is split between Vietnam Breweries, Sabeco and new entrants
• The country’s top four players have more than 80% of the market

Economy and demographics

• In 2016, GDP growth is forecast at 6.7% and an inflation rate of 5.2% expected
• By 2020, 37% of the population is expected to live in cities, compared to 27% in 2005
• Population below 30 years old was 49% of total population in 2015

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