The time of the convenience store is nigh. But will the corner shop survive?
Family Mart. Circle K. Vinmart. We’ve all seen them, their bright neon-lit facades beckoning us inside with promises of cold beer, dried noodles, ice cream, and maybe even a suspect-looking steamed bun which has been sitting on a heated rack since time immemorial, slowly incubating enough bacteria to take down a cow. We wander inside after a few beers, hungry and looking for a snack. Many of us also leave hungry, as the selection of fare is limited.
Despite this, the success and popularity of these chain convenience stores is obvious. You can hardly walk 10 steps down a street in District 1 or 2 without tripping over a Circle K or a Family Mart, and they are beginning to spread to other districts and further afield to Hanoi; in the past six months, Circle K has descended on the capital with force. Meanwhile, the relatively new Vinmart is hoping to prevail through diversification by positioning itself as a slightly more middle-class version of its convenience store brethren.
All for One
So what does this mean for the humble family-run corner shop? For those of us living in more far-flung and less glamorous parts of the metropolis, these vendors are cornerstones of everyday life. You know the type; dusty, cramped stores with shelves piled high with a variety of goods, where you can pick up pretty much anything you need and plenty that you don’t. The mother of the family sells you ice, the dad flogs batteries, and the kid who should probably be at school works the till. Did I say till? I meant enormous wad of cash produced from the teen’s pocket, from which all change is provided.
Need to wash your fancy shirt for a hot date? Nip down to the corner shop for detergent. Date went better than expected? Nip down to the corner shop for protection. Pooped yourself during the date and your prospective lover fled in disgust? Nip down to the corner shop for some beer to console yourself. And possibly more detergent.
Unfortunately, as the big chains start to encroach on the territory of the humble corner shop, it begs the question: is this the beginning of the end for the mom and pop stores? Perhaps the answer can be found by looking at neighbouring countries in Asia.
In Bangkok, there are few mom and pop stores remaining, and my colleagues in Thailand estimate that even in smaller villages about two-thirds of convenience stores are chains. According to one Thailand-based expat, the only reason they survive is because they sell beer after hours. Meanwhile in South Korea, 7-Eleven (an American-Japanese venture) has become more widespread than the native Korean GS25 convenience stores, in a sad case reminiscent of the fiendish grey squirrel becoming more populous than the indigenous red squirrel in the British Isles. Well, sort of.
Singapore, that great bastion of unbridled capitalism, has naturally welcomed 7-Elevens with open arms, leaving barely any breathing room for traditional corner shops, which have been banished to the outer suburbs. And in Shanghai, there is a Family Mart on practically every street, with C-Store providing some competition in terms of market share.
This pattern of chain stores out-muscling the little guy is very likely to be replicated here in Vietnam. As the Circle Ks and Family Marts sprout up on every street, they will leave very little market share for traditional corner shops. Already dominant in Saigon, the chains are spreading through Hanoi, and it’s a safe bet that once they have achieved dominance in the big cities, they will start opening outlets in the smaller towns in the provinces.
Corner shops will find it difficult to compete, as the chain stores have volume buying power and also offer a greater variety of products; for example, Circle K stocks San Pellegrino aranciata and Family Mart offers 15 different brands of shampoo. Moreover, the chains can afford to buy up the best shop locations.
This is likely to be exacerbated by the arrival of a shiny new competitor, 7-Eleven, which is rumoured to be launching in Vietnam by 2018. Sadly, it seems that the days of the corner shop are numbered. It’s not all bad news though; as anybody who has been to Bangkok can attest, 7-Eleven provides delicious ham and cheese toasted sandwiches, which solves the aforementioned post-beer munchies problem at least. — Kieran Crowe