Many businesses in the retail sector have been hit hard after they were forced to implement social distancing rules due to the COVID-19 pandemic.

Shoppers at a supermarket in HCM City (Photo: dangcongsan.vn)

A recent report published by the Ministry of Industry and Trade showed the pandemic was having a direct impact on distribution businesses.

Total retail sales of goods and services in the first three months were estimated at VND1,246 trillion (US$53.29 billion), up 4.67% compared to the same period last year, but the lowest increase in recent years.

In March alone, total retail sales of goods and services decreased by 0.8% over the same period last year for the first time since 2016.

Reduced purchasing power has caused the whole retail industry to tumble. Many big supermarkets such as Lotte, Co.opmart, Intimex and Aeon Mall are in crisis, with revenue dropping by up to 50%.

Specifically, Lotte’s revenue declined by about 50% in February compared to January and more than 20% over the same period last year.

Aeon Mall Vietnam’s January revenue decreased by 2%, and February was 6% below target.

Saigon Co.op Mart’s retail sales in the first two months of this year dropped by about 50% year-on-year.

Only fast food products, dry products, masks and hand sanitiser are selling faster.

Due to the outbreak, many families have had to tighten their belt, which has greatly affected the retail industry.

Khong Thu Trang, who lives in Cau Giay district, Hanoi, shared that COVID-19 had put a lot of financial pressure on family spending.

She and her husband have stayed at home without work for nearly a month, resulting in a significant cut to their income.

They have been forced to reduce living expenses and cut unnecessary purchases to help her family overcome this difficult time, Trang told the Voice of Vietnam (VOV) news portal.

Similarly, Tran Quang Hieu's family in Hanoi have also been finding ways to reduce spending during the outbreak, such as limiting shopping and shopping economically.

Experts said saving was necessary in the current situation, but this had posed a problem for businesses trying to grasp consumer psychology to adjust production and business plans in line with market fluctuations to maintain operations and overcome the difficulties caused by the COVID-19 pandemic.

Retail expert Vu Vinh Phu said the situation was a huge challenge which the retail industry must overcome, but also an opportunity for the retail industry to look back on itself to be more innovative in purchasing goods to serve society more effectively.

The retail industry must innovate comprehensively and overcome shortcomings for better efficiency, he said.

Phu said the quality and price of goods must be raised, especially in supermarkets and trade centres where consumers felt safe in their purchases.

It was also necessary to review unreasonable prices and adjust to an acceptable level.

This should also be considered an opportunity to continue renewing the way we serve consumers and build a brand sustainably, he added.