Daesang eyes South Asian market expansion via Vietnam

Daesang's production facility in Hai Duong, Vietnam / Courtesy of Daesang

By Kim Jae-heun

Food-manufacturing conglomerate Daesang is continuing to use Vietnam as its main base for expanding its presence in Southeast Asia, achieving all-time-high sales there last year.

The company has been expanding its production facilities consistently in Vietnam, where sales have soared continually.

Daesang's Vietnam unit achieved 152.8 billion won in sales in 2020, up 9 percent year-on-year, with growth from subsidiaries Miwon Vietnam and Duc Viet Food contributing heavily to the total.

Miwon Vietnam saw a rise in sales of sauces, seaweed and tteokbokki or stir-friend rice cakes, while Duc Viet Food increased its frozen food lineup and diversified retail channels to discount stores, traditional markets and hotels.

Daesang first entered the Vietnamese market in 1994 by establishing Miwon Vietnam. In the same year, it built a factory there to make the artificial flavor enhancer known as monosodium glutamate (MSG). Since then, the company has been building more factories countrywide to produce nearly 350 million tons of MSG.

Daesang entered Vietnamese refrigerated and frozen food market in 2016 by acquiring Duc Viet Food, which produced sausage meat. It aimed to increase its retail infrastructure while securing stable income through a local firm.

Last year, the food maker finished construction of another production facility in Hai Duong in the northern part of Vietnam at a cost of 15 billion won. The new factory has an annual production capacity of 14,000 tons.

Daesang plans to target the convenience food market with its trademark Korean-style sauces. It will also launch a global food brand, Chungjungone O' Food in the near future.

The company's ultimate goal is to use the Vietnamese and Indonesian markets as stepping stones to expand its business into other Southeast Asian countries. To do this, Daesang said it will continue to invest in the Vietnamese market.

“Daesang entered the Indonesian market in 1973 and expanded its business in the food and materials markets in Vietnam and the Philippines. We will continue to invest in the Vietnamese market to strengthen our competitiveness in the global food market and lead the food and material business in Southeast Asia,” a Daesang official said.