Vietnamese fuel retailers struggle with low discounts, warn of closures

Vietnamese fuel retailers are sounding the alarm over critically low discounts, threatening their ability to stay in business. Businesses report that discounts for E10 fuel hover around 10 to 300 dong per liter, while diesel discounts range from just 10 to 100 dong per liter.

These low margins are compounded by new expenses, such as tank cleaning required for E10 fuel sales, on top of existing mandatory operational costs. Retailers argue these expenses, borne entirely by them, are not being adequately calculated or compensated within the current distribution system. The discounts are significantly below the actual costs needed to maintain legal and safe business operations.

Many businesses are operating at a loss, with profits insufficient to cover expenses, leading to prolonged financial strain and pressure to maintain operations. Beyond discount issues, some retailers face difficulties accessing fuel supplies. Even when tanks are nearly empty, fuel trucks face long queues at depots, leading to localized shortages or temporary sales halts.

Retailers warn that if these conditions persist, many private businesses will deplete their working capital and be forced to cut back on sales volume, scale down operations, or cease trading altogether. They are urgently calling for dialogue between state regulators and the retail sector to address the current situation. They propose a comprehensive review of discounts and supply issues, and the development of a mechanism to ensure minimum discounts based on actual costs for stable operations. Increased oversight of supply from major traders is also requested to ensure timely and transparent fuel delivery to retailers.