Trang Tien Plaza has been re-positioned as a luxurious goods shopping mall. Will its new appearance and the new way of operation help the shopping mall change their fate?
Trang Tien Plaza in the past…
Located on the most advantageous position in Hanoi, in the golden central area of the capital city, Trang Tien Plaza did not succeed in doing business under the management of Trang Tien company Ltd, belonging to Vinaconex.
Analysts compared Trang Tien Plaza with a general store that existed in the subsidization period, or the popular retail market. The product items displayed there were very poor, while the name “Trang Tien Plaza” could not be shown as security for the quality of products.
It was unclear about the business performance of the Trang Tien Company Ltd, because it was not a public company and it did not have to make public the finance report. However, a source from Vinaconex said Trang Tien Plaza nearly did not bring profits.
Therefore, SCIC, the State Capital Investment Corporation, after taking over Trang Tien Plaza, decided to run a restructuring process.
Trang Tien Plaza has been re-positioned as a high-end goods shopping mall instead of the distributor of popular goods, which mainly serves high income earners and foreign customers.
A competition was organized for SCIC to choose suitable partners to develop Trang Tien Plaza in a new way. Five big names in Asia joined the competition, including Malaysian Parkson, South Korean Lotte and Singaporean DFS.
Finally, DFS, with the chain of duty-free shops at the airports worldwide, represented by Jonathan Hanh Nguyen, has been chosen as the partner of SCIC. The businessman, together with his family members, including the daughter-in-law Tang Thanh Ha, a celebrity of the Vietnamese showbiz, have been very famous in Vietnam.
The details of the cooperation agreement between the two sides have been kept secret. However, a senior official of SCIC said DFS would be in charge of connecting partners, looking for the clients to lease the retail premises. Meanwhile, the profits would be shared at the proportions agreed by the two sides.
With its big experiences in trading high end goods, DFS has successfully brought the world’s famous brands there, namely Luis Vuitton, Rolex, or Chanel. Vietnamese brands will also be present there, but in a limited number, because the retail premises rent would be relatively high, about $150 per square meter a month.
Trang Tien Plaza is expected to be opened on March 15. However, on pre-Tet days, it opened to receive visitors already. Analysts believed that Trang Tien Plaza, with the new appearance and new way of operation would bring good luck to the shopping mall.
Photo: Trang Tien Plaza
However, they have also warned that big challenges would come. In the economic downturn, luxurious goods have become out of reach of many Vietnamese, including the ones who once spent money like water on luxurious items.
Big discounts of 50 percent of 70 percent offered on pre-Tet days at big shopping malls like Parkson or Vincom could not help increase the sales as expected. Parkson, for example, offered the big discount rate of 40 percent for all the goods items here for one day. However, the sales did not increase significantly.
Meanwhile, Trang Tien Plaza, with the goods items worth tens or hundreds of millions of dong, would be very fastidious about clients.
In Hanoi, Grand Plaza, owned by IDJ, which was a high end shopping mall, failed to attract retailers and clients. However, some others have succeeded such as Vincom Ba Trieu or Parkson Thai Ha.