Vietnam is one of those regions in Southeast Asia which has only recently managed to metamorphose from almost purely agricultural state to attractive food market for international investors thanks to a growing economic liberalism. Within the last five years the buying power and therefore consumption among the young in the metropolises of Ho Chi Minh City and Hanoi especially have considerably increased. A love of local eating traditions is something that forges a bond between Vietnamese of all ages, however. Products such as fish and soy sauces, instant noodles and instant coffee are thus things practically no household would want to do without.
The strategic way to the top
How, then, can a company become the leading supplier of products like these in a country with a population of over 90 million? Masan knows how; it simply developed a new strategy, chiefly selling the sauces and instant noodles it had hitherto destined for export in all areas of its home market. This was designed to create a future-proof brand strategy which holds the promise of a premium product as its key message.
Pioneer with fish sauce
The company, founded in 2003, therefore first concentrated on traditional sauces and on fish sauce in particular. This is one of the three mainstays of Masan Consumer Corporation, the other two being convenience food, such as instant noodles and breakfast cereals, and beverages (soft drinks, alcoholic beverages and instant coffee) which in the meantime are produced at seven plants located throughout Vietnam.
“Fish sauce is a traditional and extremely common ingredient of all dishes in Vietnam,” explains Hô`ng So,n Pha.m, deputy product manager for supplier capability development. These sauces were largely traded through a number of smaller businesses, however, where hygiene often played a secondary role. “We therefore wanted to make a fish sauce according to the highest standards of hygiene which we could market as a premium product first throughout the whole of Vietnam and then also worldwide.”
Benchmark for Vietnam’s food industry
Masan’s next task was to find the right strategic partner so that they could keep their promise of premium to their consumers and generate interest in Masan’s high-quality fish sauce. “Masan thus makes especially high demands of its production lines,” explains Hô`ng So,n Pha.m. The company also aimed to take on a pioneering role in the Vietnamese food industry by using a fully automatic filtration and filling system for fish sauce in PET bottles. "We asked several manufacturers if they could offer us a line which was tailored to our individual specifications. KHS proved to be very flexible and service oriented and supplied the system we wanted.”
As fish sauce is extremely salty, one of the major concerns was how to prevent corrosion. Together with its parent company Salzgitter, KHS thus selected saltwater-proof grades of stainless steel for a number of machine components and surfaces. Says Hô`ng So,n Pha.m, “These materials have excellently proved themselves in practice. Corrosion on these lines hasn’t been an issue at any time.”
The turnkey filling and packaging line for fish sauce was the first system KHS delivered to Masan – and at the same time a world premiere. The very good experience with this line prompted Masan to order two more identical lines from KHS not long afterwards in 2010. All three lines are in operation at the plant in Ho Chi Minh City (formerly Saigon) and produce 24,000 half-liter and 20,000 0.75-liter bottles per hour.
with Đình Toąi Phąm, deputy manager for commercial development at Masan Consumer Corporation
How are sales distributed between the various segments?
They’re more or less equally divided. At the moment we’re making a bit more than a third with sauces and a bit less than a third with both convenience food and beverages but these figures are evening out.
What’s your company goal, your philosophy?
We’d like to give the 90 million consumers in our country a high product quality they can rely on and be a company they can be proud of.
And in the future?
We could possibly branch out into other areas besides food.
How do you manage to achieve this goal?
By working with specialists like KHS who for their part guarantee us top quality and reliability. Also looking back, we can thus say that we made exactly the right decision to work with KHS from the start.
What does this mean for your company?
We’d like to be the leading company for consumer goods in Vietnam – regarding sales, profits and brand strength.
The main advantages of the lines in brief are as follows:
- Volumetric filling with the Innofill NV is non-contact, hygienic and loss free regarding the product (minimum risk of corrosion).
- The Innopack Kisters SP 050 saves space and has been specially modified for Masan’s rectangular fish sauce bottles. The packer is blocked with a special conveyor. Here, the square bottles are transfered straight to the packer in lanes.
After so much success it comes as little surprise to learn that the company recently ordered an additional line for soy sauce based on the tried-and-tested concept of the fish sauce lines. The only minor adaptations which had to be made were to accommodate the different bottle shape (round instead of rectangular), the higher output (up to 36,000 bottles per hour) and the larger number of bottle sizes and packaging variants.
As the first automatic high-speed line for soy sauce in the country this system, too, is a pioneering achievement. Hô`ng So,n Pham’s colleague Đình Toa.i Pha.m, deputy manager for commercial development, adds, “We thus carried out extensive testing all over the country and launched the fish sauce people liked best as the premium Chin-Su brand.” Chin-Su soon became synonymous with reliable quality and the brand was then credibly transfered to other products by the company.
In this way, in just about a decade Masan Consumer has managed to capture around three quarters of the Vietnamese market for fish and soy sauce and over half of the market for chili sauce, multiplying its sales. “By 2020 we’re reckoning on an annual turnover of five billion US dollars,” announces Hô`ng So,n Pha.m proudly.
The most recent members of the Masan family are its mineral waters and soda pops. Masan also relies on its trusting partnership with KHS in this segment. On its recently ordered line, PET bottles holding 0.5 and 0.35 liters can be filled and packed at a rate of up to 36,000 bottles per hour.
KHS has also delivered an operator-friendly Innopro Paramix C blender which can store over a thousand beverage recipes. This kind of flexibility is essential for an ambitious and aspiring company like Masan. After all, it wants to be well prepared for the future where not only larger volumes are to be produced but also a greater variety of products – both of beverages and sauces. KHS has also developed a candle gap filter for the first time for the filtration of fish and soy sauce which Masan will soon be using on five lines.
“Our key to success is innovation,” claims Hô`ng So,n Pha.m. “We gear ourselves to the demands of the market and produce exactly what the consumer wants – without compromise.” ’Exotic’ products like fish and soy sauce may present the experts at KHS with an unusual challenge but not one they are not able to master with flying colors – as they have shown with Masan’s Chin-Su brand.
Your contact on this topic
Head of Market Zone Asia Pacific
KHS GmbH, Bad Kreuznach, Germany
Phone: +49 671 852-2888
Tuan Tung Minh
Manager of the KHS office for Vietnam
KHS GmbH, Ho Chi Minh City, Vietnam
Phone: +84 9037 42782
Sales engineer, KHS GmbH
Bad Kreuznach, Germany
Phone: +49 671 852-2584