Morinaga Milk Industry, a major dairy product manufacturer, held a ceremony on May 23 in Ho Chi Minh City, Vietnam, to commemorate the establishment of a joint venture with Le Mai Production and Trading Services, the company's local distributor. The joint venture, Morinaga Le Mai Vietnam, will be engaged in the import and sales of infant formula in Vietnam.
Morinaga Milk Industry began exporting infant formula to Vietnam through Le Mai in 2010. According to the company's press release, the decision to establish the joint venture was based on the fact that the market for infant formula is growing rapidly in Vietnam, which continues to enjoy robust economic growth, and that stable market expansion is expected in the future. The growth rate of sales of infant formula products in Vietnam has been steadily increasing at an average annual rate of 33% over the past 10 years from April 2012 to March 2022, according to the company.
At the commemorative ceremony, Morinaga Milk Industry President Yoichi Onuki said, "We would like to expand our business by establishing a joint venture with Le Mai, which has been instrumental in building the Morinaga Milk Industry brand in Vietnam for over 10 years. We will continue to expand sales of our infant formula products by providing safe and reliable products that meet customer needs," he said.
One of the numerical targets in the Morinaga Milk Group's 10-year vision for the fiscal year ending March 31, 2029 is to achieve an overseas sales ratio of 15% or more. Takashi Takeda, general manager of the Overseas B to C Business Department of the company's Overseas Business Division, said, "In fiscal 2019, the ratio of overseas business to total group sales was 5.0%, but it grew to 11.3% in fiscal 2022. In terms of profit margin, overseas operations account for more than 40% of total sales," he explained. He stated, "Group companies in Vietnam will work together to strengthen sales functions and corporate branding, and focus on nurturing the brands of their own products.
In Vietnam, consumers have become increasingly aware of food safety and security in recent years, and high-quality, healthy Japanese food products are attracting attention. Morinaga Milk Industry is expanding its business in the country by making Vietnamese dairy manufacturer Erobi Vietnam a wholly owned subsidiary in 2021, and starting local production and sales of yogurt and nutritional supplement drinks under Morinaga Milk Industry brand products in 2022.
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