Masan’s MEATDeli chilled meat products using European processing technology.

HCM CITY  A year after acquiring VinCommerce, Masan is restructuring the supermarket chain to realise its vision of becoming a retail-consumer unicorn. During a turbulent 2020, when many businesses were hit hard by the COVID-19 pandemic, Masan and its affiliates went on to complete major M&A deals, including the acquisitions of VinCommerce, NET Detergent and the tungsten business platform of H.C.Starck, and buying a stake in 3F Viet, a leading Vietnamese poultry player. 

Right after taking over VinCommerce, the Masan management quickly streamlined the network by closing stores with revenue per square metre that was less than 50 per cent of the level required to achieve breakeven.

At the same time Masan also created new looks and display models for VinMart and VinMart + supermarkets with an increased focus on fresh products.

It also cut operation costs, optimized its product portfolio, and renegotiated pricing policies with suppliers.

Having the MEATDeli chilled meat value chain is considered a big advantage for Masan in operating VinCommerce.

It has enabled VinCommerce to become the only consumer-retailer platform that integrates the fresh produce segment. Masan MEATLife’s acquisition of stakes in 3F Viet and adding poultry meat products to its existing meat value chain have helped VinCommerce increase its competitive advantage in the market.  

Thanks to the above, business indicators such as revenues per square metre and average invoice value have all grown.

The retail chain achieved breakeven in terms of earnings before interest, taxes, depreciation and amortization (EBITDA) by the end of 2020.

Meanwhile, Masan's core business, FMCG, continues to grow strongly driven by many new innovations.

With consumers eating at home more frequently instead of eating out due to the impacts of Covid-19, Masan has launched many new convenient food products and processed meat to capitalise on the new trend.

Besides launching a series of new products across sectors, the strategy of premiumization of products has also yielded fruitful results for Masan.

In 2020 Masan Group fulfilled all the targets set for the year including net revenues of VNĐ77 trillion (US$3.36 billion) and a net profit of VNĐ1.234 trillion ($53.78 million). 

On a like-for-like basis (which assumes consolidation of VinCommerce numbers for 2020), net revenues grew by 19.7 per cent, and its consolidated EBITDA margin increased by 13.4 per cent.

2021 revenues could exceed VNĐ93 trillion

Viet Capital Securities (VCSC) has made optimistic forecasts for Masan Group for 2021.

It expects Masan to achieve revenues of VNĐ93.1 trillion ($4.06 billion) and believes that VinCommerce's profit margin will improve when restructuring activities gradually have an effect.

They will see VinCommerce offer more fresh products to attract customers, focus on supply of Masan's own meat and vegetable brands and improve pricing and logistics efficiency.

Based on these and the cost saving effected by closing stores that did not meet profit targets, VCSC believes that VinCommerce will have a positive EBITDA in 2021.

The Masan management aims to have 10,000 retail stores by 2025. It also plans to have 20,000 points of sale under a franchise format.

With a total of 30,000 stores, Masan can serve 30-50 million consumers.

With the domestic consumer market expected to be worth over $100 billion, Masan expects to reach the revenue milestone of $5-10 billion in the next five years.

The company also wants to be among the 50 most admired brands in the world.