Retail comes under mounting pressure as consumer sentiment remains subdued due to concerns about income. Consumers are increasing savings, a shift from the spending spree fueled by booming capital and real estate markets in 2022. This change in behavior has led to lackluster demand in the retail sector. Consumers spend less, save more Despite the recent Lunar New Year holiday season, consumers remained cautious with their spending, reflecting a trend of increased saving that began in 2023. HSBC data indicated that personal consumption grew by a modest 3% last year, representing half the typical rate of increase. This conservative approach was evident in consumers’ preferences, with a noticeable shift towards prioritizing essential purchases over non-essential ones. Notably, the automotive industry experienced a significant downturn, with new car sales plummeting by 25% compared to the previous year, and motorcycle sales also plunging by 17%, as reported by SSI Securities Company (HOSE: SSI). Sales of essential goods saw robust growth, as highlighted by major retailer Mobile World Investment Corporation (HOSE: MWG). Grocery sales surged by 30% year-on-year, while sales at electronics and appliance stores experienced a decline of 20%. HSBC’s 2023 report on Vietnamese consumer behaviors underscores the profound impact of economic […]
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