Vietnam – The biggest market for beer in Southeast Asia

With the consumption of 3.4 billion liters of beer in 2015, Vietnam is the biggest market for beer in Southeast Asia and ranked third in Asia after Japan and China.

Enormous demand

Statistics show that in 2008, Vietnam was the Asian number 8 on beer consumption. However, 7 years later, Vietnam has climbed up the ladder and becomes one of the three countries that have the highest demand for beer. While the world average amount of alcohol used has not increased much in the previous decade, the beer consumption in Vietnam has doubled over the last 5 years. With this trend, Vietnam is expected to consume more than 4 billion liters of beer by the end of 2016.

According to a survey of Kantar Worldpanel Vietnam in 2012, 80% of households in Vietnam’s four largest cities Hanoi, Ho Chi Minh City, Can Tho and Da Nang spent approximately $80 for beer per year and on average a person drank 2-3 bottles of beer three times per week. In rural areas, the use of beer instead of wine during the holidays and even weekdays has become more popular, leading to a significant increase in the national beer consumption.

Increase in supply

A total of 129 breweries were operating in 2015, down by 12 as compared to year 2010. However, the number of enterprises having production capacity from 50 million to 100 million liters per year is increasing. Currently, the production capacity of the whole industry reached an annual amount of 4.8 billion liters.

4 main companies currently dominated Vietnam beer market with 90% of the market share include: Habeco (Hanoi Brewery), Hue Brewery (owned by Carlsberg 100%), Sabeco (Saigon Brewery) and Heineken NV. Among those, the first three names reflect their geographical targets and dominance. Instead of having a particular geographic preference, Heineken focuses on the medium and high end segment.

Apart from these 4, Vietnam’s domestic beer market is also witnessing the powerful emergence of Sapporo (Japan), AB-InBev (USA) and the latest is Shingha (Thailand) with 25% stake holding in Masan Consumer Holdings. After becoming an enterprise with 100% foreign capital, Sapporo has changed its packaging images and expanding its distribution network. On the other hand, AB InBev established a new brewery in May 2015 with the capacity of 50 million liters per year and is aiming to increase to 100 million in the upcoming years. All of these activities are in place to serve the enormous demand from the Vietnamese customers.

Sources: 1, 2, 3