Page 118 - CRC_One Report 2021_EN

Business Overview and Performance Corporate Governance Financial Statements Enclosure

Key retail players that operate in the same business segments in Vietnam as Central Retail are as follows
• Hypermarket / Supermarket / Convenience Store: Saigon Co.op, VinGroup, Lotte Group, Masan Group
• Electronic business: MobileWorld JSC, FPT, Media Mart
• Retail Plaza: VinGroup, AEON Mall, and Lotte Group

Central Retail plans to leverage Big C / GO! Vietnam’s leading hypermarket retailer, as a platform to accelerate
growth in the country. Big C / GO! retail plazas in Vietnam are anchored by Big C / GO! hypermarkets and lease
space to third party stores as well as its own retail banners. Central Retail intends to apply a similar concept
in rural areas anchored by go! supermarket, with a modified retail category mix catering specifically to rural
consumers. Central Retail believes that the hypermarket and supermarket model combined with retail plaza
will become a powerful force multiplier that drives business growth.

Central Retail believes that as incomes increase, Vietnamese consumers will demand increasingly more
sophisticated and specialized retailing experiences. In anticipation of such changes, Central Retail continues
to introduce variety of merchandise. Central Retail has introduced a new retail brand to Vietnam, such as
Dyson, an electrical appliance store. Central Retail will rely on the success of Big C / GO! Vietnam as a way to
introduce innovative niche retail brands in a similar manner of Central Retail responds to changes in consumer
preferences in Thailand.

(3) Overview of the Italian Retail Industry

Although, COVID-19 pandemic affected economy and society in numerous ways since 2020. However, Italy’s
2021 GDP expanded at a slightly faster-than-expected rate of 6.6% last year as investment, consumption and
export bounced back, according to the Italian National Institute of Statistics (ISTAT) while the consumption has
significantly recovered in all sectors, especially industrial and retail businesses.

Central Retail is the leader in department store business in Italy under the Rinascente brand with 9 stores in
8 cities across Italy. Flagship stores located in Milan and Rome are one of the leading places for shopping in
Europe. Central Retail focuses on providing customers with a superior in-store shopping experience by constantly
renovating and decorating their stores, in the hope to attract reputable brands. In addition, Central Retail
highlighted the extension of omnichannel platforms as a strategy to drive business growth through full scale
E-commerce website of Rinascente at www.rinascente.it and Rinascente ON DEMAND service. Apart from
that, Central Retail focus on increasing domestic customers to minimize the impact of lower foreign tourists.

1.2.4 Supply, Inventory, and Distribution

As of 31 December 2021, Central Retail had more than 20,000 supplier networks, of which the first 20 networks
provide products to 3 business units of Central Retail, thereby leading to sufficient variety of products and
reducing concentration risks. As of the year ended 31 December 2021, none of the suppliers distributed products to
Central Retail, accounting for 10% of the total purchase volume of Central Retail. Central Retail believes that it
has good and robust relationship with the suppliers since it places priority on all suppliers and that it is a reliable,
fair and reasonable business alliance. For those reasons, its relationship with most suppliers has lasted for over 15 years.

(1) Selection and Relationships

Central Retail is highly selective in choosing suppliers and typically receives substantially more requests from
suppliers and brands than Central Retail can accommodate. In selecting suppliers, Central Retail carefully
considers numerous factors, such as quality, reliability and scale. Additional factors considered include whether
the brand fits the tastes of target customers and whether its price points match their means, as well as financial
status of the supplier and its operating model. Supporting local OTOP and SMEs is another consideration for suppliers.

118 Annual Report 2021 (Form 56-1 One-Report)