Tokyo, Japan – Aeon Group, Japan's preeminent retail conglomerate, has unveiled an aggressive expansion strategy for its Vietnamese operations, signaling a significant deepening of its commitment to the burgeoning Southeast Asian market. The company aims to establish a commanding presence in Vietnam's retail landscape by increasing its network of large-scale stores to an ambitious 100 locations by the year 2030. This target represents a near eightfold surge from its current footprint, underscoring Aeon's bullish outlook on Vietnam's economic prospects and consumer demand.
According to a recent report by Nikkei Asia, Aeon's expansion will primarily focus on its corporate supermarket (SSM) format. These stores are strategically designed to be comprehensive retail destinations, integrating a wide array of offerings including fresh groceries, diverse food court options, and an assortment of general merchandise, notably beauty and household items. This integrated approach aims to cater to the evolving needs and preferences of Vietnamese consumers, who are increasingly seeking convenience and a holistic shopping experience.
Yasuyuki Furusawa, the President of Aeon Retail and the former driving force behind Aeon's Vietnam business, has articulated the strategic rationale behind this aggressive expansion. He emphasized that achieving a substantial scale, with 100 General Merchandise Stores (GMS) and SSMs by 2030, is crucial for effectively competing with established regional giants such as Thailand's Central Group. Furusawa's vision underscores Aeon's determination to become a dominant player in Vietnam's dynamic retail sector.
Aeon's long-term investment in Vietnam is already substantial. As of September last year, Furusawa, in his capacity as the head of Aeon Vietnam, highlighted that the company's cumulative investment in the country over the preceding decade had reached a significant $1.5 billion. This existing commitment provides a solid foundation for the planned expansion, demonstrating Aeon's enduring faith in Vietnam's growth trajectory.
In parallel with the expansion of its large-format stores, Aeon Vietnam is also pursuing a strategy of broad market penetration through smaller retail formats. The company intends to establish a nationwide network of 200 smaller supermarkets, including strategically located grocery stores. This dual-pronged approach, targeting both large urban centers and smaller communities, aims to maximize Aeon's reach and cater to a diverse range of consumer needs across Vietnam.
As of February this year, Aeon's presence in Vietnam included 13 large-scale stores, three of which were its core SSM format. Additionally, its subsidiary operated 36 Citimart-branded supermarkets, indicating an existing, albeit smaller, footprint in the country's retail landscape. The ambitious expansion plan signifies a clear acceleration of Aeon's growth strategy in Vietnam.
The financial performance of Aeon's Vietnamese operations provides a compelling rationale for this expansion. According to Aeon Mall's fiscal year 2024 report (covering March 2024 to February 2025), the Vietnamese market generated revenues of 17.3 billion yen (over $121 million), marking a robust 13% year-on-year increase. More impressively, the post-expense net profit from Vietnam reached 4.23 billion yen (approximately $29.6 million), an 8.6% increase. This profitability ranks Vietnam as Aeon's most lucrative overseas market in Southeast Asia and its second-largest globally, trailing only China.
While the profit generated by Aeon Mall's Vietnam business was slightly lower (10.7%) than that of its Chinese counterpart, this is particularly noteworthy considering that China's revenue was nearly four times higher. This disparity underscores the efficiency and profitability of Aeon's operations in Vietnam, establishing it as a crucial cash cow within the company's international portfolio.
Vietnam's compelling demographics and economic growth are key drivers behind Aeon's strategic focus. With a population exceeding 100 million and a rapidly expanding middle class characterized by increasing disposable income and evolving consumption patterns, Vietnam presents a significant and attractive consumer market for Japanese retailers like Aeon.
Data from Vietnam's General Statistics Office (GSO) further underscores this potential, revealing an 8.3% year-on-year increase in retail sales in the past year, reaching 4,920 trillion dong (over $189.4 billion). This robust growth trajectory signals a vibrant and expanding consumer market ripe for further penetration by established international retailers.
The positive sentiment towards the Vietnamese market extends beyond Aeon. A recent survey conducted by the Japan External Trade Organization (Jetro) among Japanese companies operating in Vietnam revealed that over 60% reported profitability in the past year – the highest positive response in five years. Furthermore, a significant 56% of these companies indicated plans for business expansion within the next one to two years, reflecting a strong and sustained optimism regarding Vietnam's economic outlook.
Haruhiko Ozasa, the head of Jetro Hanoi, aptly summarized this sentiment, stating that this level of optimism is the highest among ASEAN nations, positioning Vietnam as a country with exceptionally strong growth potential. This broader positive outlook among Japanese businesses further validates Aeon's ambitious expansion plans and highlights Vietnam's increasing importance as a key investment destination.
Aeon's bold expansion in Vietnam reflects a broader trend of increasing Japanese investment in the country, driven by Vietnam's strong economic growth, favorable demographics, and strategic location within Southeast Asia. As Vietnam continues its economic development and its middle class expands, the retail sector is poised for significant growth, offering substantial opportunities for established players like Aeon to capitalize on the increasing consumer demand. The success of Aeon's ambitious expansion will not only reshape Vietnam's retail landscape but also serve as a key indicator of the potential for foreign investment in this dynamic Southeast Asian market.
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