Instant noodles are past their prime.

Instant noodle consumption in Vietnam has decreased for three consecutive years, from 5.2 billion packets in 2013 to 4.8 billion packets in 2015 and shows no signs of stopping.

Instant noodle purchasing power in the market is decreasing. Photo: Hong Chau.

As a company that has been a market leader for many years, Acecook Vietnam Joint Stock Company has also suffered a decline in the past two years. According to the company's leaders, if in 2013 the company's revenue reached 10,000 billion VND, in 2014 and 2015 it dropped to 9,000 billion VND, a 10% decrease compared to the same period last year.

Explaining the reason for the decline, Mr. Kajiwara Junichi, General Director of the company, said that this was the impact of the general trend in the world. In addition, recently there has been a lot of inaccurate information about instant noodle products, making customers feel insecure and reducing their usage.

Ranked second in the instant noodle market and with a fairly fast market share, but in the past year, the instant noodle business situation at Masan Consumer Joint Stock Company has also declined. According to the report of Masan Group - the parent company of Masan Consumer, the convenience food industry, including instant noodles, has been flat due to the negative growth in the market in terms of consumption volume. Therefore, in 2015, Masan Consumer only achieved revenue of 13,200 billion while profit decreased by 15% to 2,900 billion. In the first 6 months of this year, sales revenue increased slightly, but profit decreased by 20% compared to the same period.

Always maintaining a stable profit level, but in the past two years Colusa - Miliket Food Joint Stock Company has also been slowing down.

Specifically, in 2014 the company only achieved 26 billion VND in profit, down 39.5% compared to 2013. In 2015, revenue and profit improved but for the whole year only reached 478 billion VND in sales, pre-tax profit of 40.5 billion VND, down 14% and 6.7% respectively compared to the peak recorded in 2013.

Not having a large market share like the above enterprises, in mid-2015, after selling the confectionery division, Kinh Do Group (now renamed KiDo) combined with Saigon Ve Wong to launch the Dai Gia Dinh noodle brand. However, because it was new to the industry and faced many challenges in the context of declining market consumption, the company did not achieve its expected target in 2015.

Talking to reporters, Mr. Tran Le Nguyen - General Director of the company said that this industry is not only fiercely competitive but also requires a large amount of capital to invest. Having only been in the market for a year, the investment cost for this segment is quite high but the profits are not easy to earn. Not only that, recently the purchasing power in the market has decreased sharply, making business activities increasingly difficult. The company is still maintaining this business but will not invest more until the market recovers.

A survey at supermarkets in Ho Chi Minh City shows that instant noodle products are increasingly diverse with dozens of brands of all types, from imported to domestic with all segments, but purchasing power is decreasing.

According to some supermarket chains in Vietnam, if instant noodles were chosen by many consumers in previous years, in recent years, products made from rice have tended to replace them and increase in popularity.

According to the report of the World Instant Noodles Association (WINA), in 2013 Vietnam consumed 5.2 billion packages of noodles, but by 2014 it had decreased to 5 billion packages and by 2015 it had decreased to 4.8 billion packages. Vietnam is the 4th largest country in the world in terms of noodle consumption after China, Indonesia and Japan. This downward trend has not shown any signs of recovery as consumers increasingly have other options.

Acknowledging the need to change ahead of the times, General Director Kajiwara Junichi said the company is boosting exports, increasing premium noodle products with vegetables and rice products. In the first 6 months of the year, the company's rice products such as pho and vermicelli increased by 25%, vermicelli increased by 32% and cup noodles increased by 45%.

In Vietnam, a report from the Ministry of Industry and Trade shows that there are currently over 50 instant noodle businesses, producing nearly 5 billion packages a year. Data published since 2014 shows that Masan Consumer holds a market share of 16.5%, Asia Food holds 12.1%; Vina Acecook, a company with Japanese investment, leads the market with 51.5% market share. The remaining 20% ​​is reserved for smaller brands such as Miliket - Cosula, Vifon, etc.

According to VNE