Lotte Mart received an investment licence from Vietnam just three days before Vietnam joined the World Trade Organization (WTO) in 2006. “We wanted to open our supermarkets in Vietnam before we entered China and Indonesia but for certain reasons, Lotte Mart is just now appearing in South Saigon,” said Noh Byung Yong, General Director of Lotte Mart group.
Lottee was the first big foreign retailer to come to Vietnam. Last year Hong Kong’s Wellcome joined the local distribution market, but it hired five supermarkets from Vietnamese retailer Citmart.
Lotte Mart comes to Vietnam through a joint venture with Minh Van Company, named Lotte Shopping Vietnam Co., Ltd., in which the Korean investor contributes 80% of capital. This is the first Lotte Mart overseas joint venture, though it has 90 supermarkets in four countries.
Noh Byung Yong said the Lotte supermarket in HCM City is especially important for Lotte Mart because it is the first overseas mart that is invested in and managed by Lotte Mart group. The system of Lotte supermarkets in China (8) and Indonesia (19) were transferred from the Marco group.
The General Director of Lotte Vietnam, Lee Sang Woo, said the Lotte South Saigon supermarket is the largest trading centre in Vietnam, totalling 33,000sq.m. Nearly 10% of its goods are imported from South Korea and most of the remaining are local goods. Lee wants this mart to become a cultural, entertainment and shopping centre of the South Saigon area.
Lotte’s opening of its supermarket in Vietnam before January 1, 2009, when Vietnam has to entirely open its distribution market under its WTO commitments, is said to be the first gunshot heard in the local retail market.
In the past two years, many local distributors like Saigon Coop, Citimart, Phu Thai have been racing to expand their supermarket systems to prepare for January 1, 2009.
Lotte Mart belongs to the Lotte Group of South Korea, the fifth-largest group in the country. It operates in distribution, food, heavy chemical, credit, construction and tourism areas.
