Over 8,700 retailers, auto and bike repairers leave market in Q1
By Le Hoang
|Many retail spaces on a street in HCMC remain empty. More than 8,700 enterprises in the wholesale-retail, automobile and bike repairing sectors leave the market in the first quarter of this year – PHOTO: THANH TAO|
HCMC – Due to the Covid-19 pandemic and the strong development of e-commerce, more than 8,700 enterprises in the wholesale-retail, automobile and bike repairing sectors withdrew from the market in the first quarter of this year, up 24.5% year-on-year, according to the Business Registration Department under the Ministry of Planning and Investment.
The number was much higher than the number of suspended enterprises in other sectors.
Going online has become a trend among many retailers in HCMC and other localities over the past two to three years. The trend has grown further since Covid-19 broke out in early 2020.
Last year, more than 101,700 enterprises withdrew from the market, up 13.9% over 2019, including nearly 46,600 companies signing up to temporarily suspend operations, nearly 37,700 halting operations to complete dissolution procedures and some 17,500 being dissolved.
Among the firms that signed up to temporarily suspend operations, 17,360 were wholesale-retail, automobile and bike repairing businesses, surging 56.2% versus 2019.
The representative of a company selling paintings and souvenirs to international tourists in HCMC said his company has suspended its operations for a year to reduce losses and operation costs.
He has plans to resume the company’s operations in May or June when foreign tourists are expected to return to Vietnam. However, the pandemic remains complicated across the world, so he was unsure about his resumption plans.
In addition to Covid-19, the online business trend has caused multiple difficulties for owners of retail spaces in HCMC and other large cities to look for lessees.
Surveys of real estate companies showed that retailers in the food-beverage and fashion sectors tend to lease small retail spaces or return retail spaces.
The pandemic has forced consumers to cut their spending. As a result, multiple retail spaces in busy streets in HCMC and Hanoi have yet to find lessees.
However, wholesale and retail enterprises are those that can easily enter and withdraw from the market. They have faced many difficulties due to the pandemic which has changed consumers’ shopping habits and affected supply chains.
In the first three months of the year, more than 5,200 wholesale-retail, automobile and bike repairing businesses resumed their operations, accounting for 35.4% of the total firms returning to the market and falling 3.4% over the figure in the same period last year.