The Vietnamese retail group stated final yr’s outlet growth made losses ‘inevitable’ as its flagship The Espresso Home café chain faces elevated competitors from home and worldwide operators
Seedcom operates 155 The Espresso Home retailers throughout Vietnam | Picture credit score: The Espresso Home
Vietnam’s Seedcom has reported its third successive annual loss, regardless of strong gross sales development for the 12 months ended 31 December 2022.
The retail group, which operates 155 The Espresso Home retailers throughout Vietnam, reported losses widened 14.5% final yr to VND 270bn ($11.5m).
Seedcom chairman Nguyen Hoanh Tien stated losses had been ‘inevitable’ following the growth of its retail networks in 2022.
Ho Chi Minh-based Seedcom, which additionally operates the Kingfoodmart grocery store chain and Juno and Hnoss vogue manufacturers, achieved 60% group income development throughout the interval to succeed in VND 1.6trn ($712m).
In November 2022, Seedcom reported The Espresso Home contributing 37% of its complete gross sales within the first 9 months of final yr, with the espresso chain producing year-on-year gross sales development of 53%.
Amid rising competitors within the Vietnamese branded espresso store market, The Espresso Home launched a brand new ‘unique and upscale’ espresso store model – SIGNATURE by The Espresso Home – in January 2023.
The Espresso Home CEO Ngo Nguyen Kha stated the specialty espresso store caters to rising shopper demand for premium café experiences throughout the nation.
Amongst operators vying to realize a stronger foothold within the Vietnamese branded espresso store market, Starbucks stated its long-term objective within the nation is to change into shopper’s ‘on a regular basis café’. The US espresso large beforehand set a goal to succeed in 100 shops within the nation by the tip the primary quarter of 2023.
In February 2023, Masan Group outlined plans for Phuc Lengthy Espresso & Tea to change into the biggest espresso and tea chain in Vietnam ‘inside a couple of years’. The retail conglomerate plans to develop the espresso chain’s home footprint in 2023 and expects to extend its revenues by roughly 75% over the subsequent 12 months.
Phuc Lengthy Espresso & Tea at present operates 111 flagship shops throughout Vietnam, alongside 21 smaller format retailers and an increasing kiosk presence in Masan Group’s WIN comfort retailer community.
In March 2023, Filipino quick meals group Jollibee Meals Company reported sturdy year-on-year outlet development for its Highlands Espresso chain, which operates 553 shops nationwide.
World Espresso Portal analysis forecasts the Vietnamese branded espresso store market, led by Milano Espresso with greater than 2,000 shops, will exceed 5,200 retailers by 2025.