HO CHI MINH CITY -- Vingroup, Vietnam's leading property developer, signed a delivery and logistics cooperation agreement on Tuesday with Japan's Sagawa Holdings in a move to develop its own delivery channel for its fast-growing retail business.
Sagawa does business in 220 countries, and will provide comprehensive logistics solutions for Vingroup's retail business brands, VinCommerce, VinDS and VinEco.
The service package covers domestic and international freight services by air, sea, or land; customs services; and computerized warehousing and transport solutions to preserve quality, especially of vegetables and other foodstuffs.
Duong Mai Hoa, Vingroup's managing director, said the agreement takes domestic logistics to a new level, and brings the Vingroup distribution system up to international standards.
With a background in residential, retail, hospitality, and entertainment property development and operations, Vingroup has been expanding its retail network, which includes a supermarket chain and convenience stores, and aims to be Vietnam's biggest retailer in the next few years.
In September, it also announced its entry into education and health care, and its intention to reinvest all profits in personnel and facilities.
In the first nine months of 2016, Vingroup posted 34.6 trillion dong ($1.6 billion) in revenue, an 80% increase year on year with net profit tripling to 3 trillion dong.
In October, Vingroup received B and B+ credit ratings from Standard & Poor's Financial Services and Fitch Ratings respectively.
Fitch said that Vingroup's robust performance in property development had offset losses in its nascent consumer retail business.
S&P said steady property sales in recent quarters and growing diversification will continue in 2017, and that the company's solid operating cash flow will largely cover the extra capital expenditure needed for expansion.