HCMC – Vietnam’s modern retail sector is under mounting pressure as U.S. tariffs have put a strain on domestic production and feed into rising costs and inflation risks.
Olivier Langlet, group CEO of Central Retail Vietnam, said that recent tariff developments were already having a tangible impact on manufacturing activity, with immediate consequences for shopping malls and hypermarkets across the country.
Vietnam produces a large volume of goods domestically, and any slowdown in production quickly affects modern retail, Langlet told a panel discussion at the Vietnam Vanguard Summit in HCMC on January 7.
“As soon as you have a drop in production, it impacts modern retail immediately,” he said.
Many modern retail outlets are located close to production hubs, linking store performance closely to factory output and supply chain stability. As a result, global trade tensions and policy shifts can translate rapidly into weaker retail conditions.
“There will not be a modern Vietnam without strong modern retail in the future,” he said, adding that the sector’s future would depend heavily on how Vietnam navigates external shocks, including global trade and tariff pressures.
The impact is extending beyond volumes to costs. Tariff-related pressures were contributing to inflation, particularly through higher technology expenses required to operate modern retail systems.
Langlet said prices for items linked to information technology have risen by about 25% and added to cost pressures for retailers already facing narrow margins, citing internal discussions with his chief information officer.
While Central Retail can absorb part of the price increase because of its financial position, Langlet warned that sustained inflation would eventually leave retailers with little room to shield consumers.
