One Distribution JSC has officially announced the launch of the VinShop application – a technology product that plays the role of connecting goods supply directly from the manufacturer to the owner of the grocery store.
One Distribution is a branch of One Mount Group – a member of Vingroup and strategic partner Techcombank.
“The birth of VinShop is expected to create a strong innovation, change the face of grocery stores in the alleys of the residential area.“, Mr. Tuan Nguyen – Deputy General Director of VCCorp Joint Stock Company – said.
The reason that VinShop participates in this new game is because the piece of cake in the retail market is located in more than 9000 markets and 1.4 million traditional grocery stores are very large, accounting for 75% of the market share with 10 billion USD in sales. per year, according to a Nielsen 2018 report.
Mr. Tuan Nguyen said that when a business is deployed, it will usually target the market in three ways:
One is, participating in available markets, the cost of entering this market is low, but the opportunity is low and growth is not high, and there is much competition.
Two is, creating a new market that no one has come to yet (like Facebook’s growing internet in Africa to expand the online advertising market, or startups creating products for new demand). This approach is extremely expensive and risky, time consuming.
Third is, converting existing markets into a new form, thereby expanding.
“VinShop has chosen the third way, to take advantage of the existing market with its strengths to lead the market to a new type in which they will master the game, both fast, inexpensive and low-risk.“, Mr. Tuan admitted.
An arrow shoots 3 birds
Grocery stores have existed for a long time and are widely developed because of the simple, small-scale grocery store model, taking advantage of the premises that are home to the owner of the shop, workers are also homeowners and relatives so low operating cost, easy to deploy. As for buyers, because of the convenience factor, sending their children to a neighbor’s house or running to the front lane is to be able to buy immediate necessities in particular or FMCG (FMCG) in general.
What can VinShop change?
Mr. Tuan Nguyen – Deputy General Director of VCCorp JSC.
VinShop wants to transform traditional grocery stores into technology stores, where grocery store owners can easily access hundreds of thousands of manufacturers and distributors anytime (24/7) to choose to order the products for sale at the best price by opening the VinShop app, from which the selected product will be delivered within 24 hours.
Lower operating costs drag cost of goods sold down one notch, and COGS continues to be reduced further as Vin’s model cuts multiple intermediate levels.
In addition, VinShop also supports signs, arranges goods for these stores and helps the grocery store increase income by connecting with brands wishing to display goods on the shelves of the store. Thus, those who have a house on the alley, want to open a grocery store, are now very easy with the support of VinShop.
“And yet, with its strategic partner, Techcombank, it can be seen that VinShop’s intention is to deploy financial models for small businesses, particularly for grocery stores to buy on deferred payment or borrow money for business. joint“, Mr. Tuan Nguyen admitted.
“According to the announcement of VinShop, at the time of its launch, they were able to work with more than 20,000 grocery stores and there will be more in the coming time. With the ownership of VinID, … boom, the grocery stores will instantly turn into a VinID Pay accepting point, where customers can use VinID to pay, accumulate points, even later lend fish. multiply“.
Weakness when “reclaiming land” groceries
Illustration. Source: Infonet.
Talking about the weaknesses in VinShop’s flag, Mr. Tuan Nguyen said that the “reclamation” of a new market will need perseverance to invest great resources to convert traditional grocery stores to new ones, and it takes time enough to educate the market.
“Educate time I think no less than 3 years“, Mr. Tuan said.
Currently, VinShop is “burning money” to increase brand recognition and user development (User Acquisition). Dealers will receive immediately 750,000 VND / month when participating in the VinShop display with a full set of identifiers such as nameplates, vertical pillars, counter stickers, standing signs, information boards, leaflets. In addition, when introducing customers to buy and register VinID applications, the shop owner also received nearly 9.5 million VND / month. The use of sales features (1POS) of VinShop is also encouraged with incentives up to 500,000 VND / month.
Identifier of VinShop / store.
The strength of VinShop, Mr. Tuan said that its professionalism and strong ecosystem will help VinShop win the game. Although small traders are particularly price sensitive, the game of VinShop will be durable because once customers are tied to the ecosystem, they will be difficult to quit, when VinID will deploy a series of programs from point accumulation, focus, recharge, loan …
With the loan feature, in the near future, VinShop plans to cooperate with Techcombank to launch financial solutions such as deferred sales, preferential loans to help grocery store owners do business smoothly. with abundant capital.
“It is impossible to joke with the heads of billionaires. They always make big games, strongly impacting the industry. In general I welcome and support, because people will be the beneficiaries anyway“, Mr. Tuan expressed.
According to Young Intellectuals