Vietnam: A strong driver behind DKSH’s growth
DKSH has recently announced that its net sales grew by 2.3% to CHF 5.1 billion (US$5.13 billion) in the first half of this year and exceeded the five-billion mark for the first time. On this occasion, The Saigon Times Daily talked with Jorge Martin-Martinez, CEO and CFO of DKSH Vietnam, about the Vietnam market.
The Saigon Times Daily: Could you tell us about main reasons behind your firm’s impressive results?
- Jorge Martin-Martinez: First of all, DKSH generated further strong growth in frontier markets such as Vietnam, Laos, Cambodia and Myanmar. Also, we managed to adapt to the unstable political situation in Thailand and overcome the difficult market conditions in Hong Kong. In addition, we have to mention the solid growth from our business units, including healthcare, performance materials and technology, which generated higher net sales of 11%, 12% and 9% respectively compared to the first half of 2015.
Could you elaborate on the contributions of frontier markets, especially Vietnam?
- While we don’t communicate numbers on country level, I can tell you that DKSH generated further strong growth in the first half of 2016 in the frontier markets of Southeast Asia. Without any doubt, Vietnam as one of the rising stars among the Asian economies is a strong driver behind our growth. We now employ 3,485 specialists, up 11% against more than one year ago. Behind our growth is the rising middle class in the country – people that more and more consider buying products like Mars chocolate bars that DKSH markets in Vietnam.
How will DKSH take advantage of this growth to make further headway in the Vietnamese market?
- We perceive Vietnam as one of the most dynamic markets in the world and believe in the potential of the Vietnamese market. This means a lot of opportunities for us at DKSH, when more clients decide to outsource their Asian business to us. We still have huge growth opportunities in our markets, supported by three major growth drivers: rising middle class, increasing inner-Asian trade and trend to more outsourcing.
What will DKSH focus on in Vietnam?
- Our focus is to enhance our capacity to better serve our clients and customers. Recently, at the end of May, we reinforced our logistics capacity by relocating the distribution center in Danang to a larger and more modern facility in Hoa Cam Industrial Park in the central city. This new state-of-the-art infrastructure will provide the highest level of operational efficiency in logistics and distribution services across the country.
Another initiative is to digitize our sales and marketing channels. As digitization is a mega trend in the global economy, we are taking the opportunity by offering our business partners an integrated approach, combining digital channels with our existing modern and traditional channels, as part of a comprehensive and balanced omni-channel strategy.
The consumer goods sector in Vietnam has witnessed robust growth with the participation of new international players as well as expansion of operational domestic and international players. What are your forecasts about this sector?
- Consumer goods is one of the most important business units for DKSH Vietnam. Currently, we serve 42 international and local clients in this industry. The participation of new international players as well as expansion of domestic operations will make the market more competitive, but also exciting. We take this as both a challenge and opportunity, which force ourselves to continually strengthen and expand our range of service offerings across the entire value chain. Our expertise and broad local knowledge together with our infrastructure enable us to better understand our business partners’ needs and to deliver customized solutions to grow their business. To ensure long-term success, we constantly deliver more value-added solutions which create a competitive advantage to stay ahead of the market.
How will DKSH, as the leading Market Expansion Services provider with a focus on Asia, gain bigger market share and maintain growth?
- In order to gain more market share and maintain sustainable, profitable growth in the upcoming years, we will focus on what we do best: providing our clients and customers proactive and efficient solutions to expand their businesses in existing and potential markets. As markets become more competitive, companies are forced to focus on their core competencies and outsource non-core activities like product registration, marketing, sales, distribution and cash collection. To achieve this, they rely on experienced Market Expansion Services providers, such as DKSH.
Reported by Nhan Tam