22-12-2015
In 2013, the total sales volumes from distilled and fermented liquors reached 500 million USD, increased up to 1.8 times in comparison to that of 2005. More specifically, more than half of the distilled beverages consumed are vodka, meanwhile for wine, over 60% are red wine.

Distilled liquors are imported mainly from China, Taiwan, Singapore, whereas the majority of wine originated from countries with long history and competitive strength within the sector such as France, Italy; however, in recent years, imports from emerging markets such as the US and Chile have increased. The value of liquors imported from Japan has also experienced a sharp increase, from 300,000 USD in 2005 to 2.7 million USD in 2013 (with CAGR of 39%). The level of Japanese liquors’ awareness in the market has increased, but the share of this liquor category is still low.
In terms of quantity, Hanoi Liquor (under Halico – a subsidiary of Habeco) is the representative in the distilled liquor sector, while Thang Long Liquor is for wine sector. Halico was founded in 1955, produced the most famous local liquor namely Vodka Hanoi, taking up to 51% distilled alcohol market share in 2012. On the other hand, there is no company occupying more than half of the wine market share, the largest one, Thang Long Liquor occupy 23% share only.

By revenue, these companies respectively accounted for 20% and 3-4% in spirits and wine sectors. The reason is that foreign-imported alcohol got 3-4 times as expensive as domestically brewed products. Premium products are consumed primarily in urban high-income class or on special occasions such as Lunar New Year.
Large foreign enterprises’ presence in the liquor market includes Pernod Ricard and Diageo. Pernod Reicard being active in both distilled and fermented wine sectors, was founded in 2011 and has been famous worldwide with brands such as Chivas Regal, Absolut Vodka. Diageo is the 2^nd largest company after Halico in distilled beverage sector, and has established a subsidiary in Vietnam from 2007. The company is implementing marketing activities for Johnnie Walker, Smirnoff; and in the period 2011-2012, they have invested $97 million and acquired 45.5% share from Halico.
The provisions of Vietnamese law on alcoholic drinks are quite stringent and complex; however, the recent move to ease tariffs for this sector is an advantage for foreign firms. In May 2013, tariffs for both imported wine and spirits were reduced from 48% to 45%. Moreover, when TPP is signed, it is predicted that this rate will continue to decrease and the quantity of imported alcohol will increase. However, some also worry that the spread of counterfeit and smuggled alcoholic drinks will drive to the government’s policy of consumption tax to restrict excessive consumption of alcohol and therefore make major changes to this market in the future.

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