Vietnam’s 3 top pharmacy chains go their separate ways in strategy terms

An Khang has stopped opening new stores, Pharmacity restructured and rationalized its chain and Long Chau now has the largest number of stores.

In August 2022 Pharmacity had the most outlets — some 1,100 after opening more than 200 during the year. But then it closed many of them to lose its leading position despite opening new ones in more strategic locations.

It now has 936 to Long Chau’s 1,009, while An Khang has 504.

Doan Van Hieu Em, head of An Khang, owned by retail giant Mobile World, said in the first three quarters of 2022 the chain expanded faster than its two rivals.

“From the earlier goal of having 800 drugstores, slowing down a bit helps us consolidate and find opportunities to boost revenues.”

An Khang also on Doi Can Street, Hanoi. Photo by VnExpress/Anh Tu

An exectuive at FPT Digital Retail Joint Stock Company, which owns Long Chau, told VnExpress on Feb. 21 that the company continues to identify the pharmacy business as its growth engine and expects to open 400-500 stores this year.

In 2021 most of FPT Digital Retail’s revenues came from its electronics chain FPTShop. Long Chau contributed only 18%.

In 2022 that rose to 32% as revenues surged to VND9.6 trillion (US$406.7 million).

This year Pharmacity is continuing to relocate its stores strategically and focusing on improving gross profit margin and optimizing operating costs.

Pharmacity opened its first airport drugstore in mid-January at Noi Bai International Airport in Hanoi. Photo courtesy of Pharmacity

Mobile World said it would not open more An Khang stores this year and instead focus on keeping profitable ones.

It also seeks to increase revenues and cut operating costs to reduce losses.

Last year An Khang had sales of VND1.5 trillion, or 1.1% of Mobile World’s total revenues.