The pet food distribution sector in Vietnam is undergoing a restructuring phase, driven by rapidly increasing imports, clearer online pricing, and stricter regulatory controls. This article outlines six changes most likely to occur in the next three to five years, along with supporting arguments and specific actionable implications for pet shop owners, distributors, and those considering entering this industry.
Why the rules of the game in pet food distribution are about to be rewritten.
An industry typically changes its distribution structure when three conditions arise simultaneously: sufficient scale for profitable specialization, transparent pricing information allowing buyers to compare prices, and stringent legal barriers to weed out amateur players. All three conditions are converging. According to the Ministry of Agriculture and Rural Development, pet food imports have increased by approximately 69% over five years, meaning supply is no longer scarce. Wholesale buyers can check prices in seconds on their phones. And registration and quarantine procedures are being standardized. When these three factors meet, the old advantage based on information asymmetry disappears, replaced by a new advantage in system operation. For distributors, the immediate task is not to wait and see who wins, but to reassess current suppliers according to the new criteria for the upcoming period.
Change number one: importer withdraws from retail.
The most significant change is the specialization of roles. In its early stages, a business that imported, wholesaled, and operated retail stores could survive because the market was small and customers lacked comparison tools. That model is now self-destructive. When the importer’s retail prices appear on e-commerce platforms and social media, distributors immediately realize they are competing with their own source of supply, and the only logical reaction is to reduce orders or switch suppliers. Therefore, serious pet food distributors will shift entirely to a non-retail distribution model, focusing resources on what distributors cannot do themselves. The implication is clear: when negotiating partnerships, distributors should directly ask suppliers if they offer parallel retail sales and demand that this commitment be documented in writing, not just a verbal promise.
Second change: official channels are being tightened, and smuggled goods are losing ground.
The second change comes from the legal framework. Pet food in Vietnam is regulated as animal feed, according to the 2018 Livestock Law and Decree 13/2020/ND-CP, which replaced Decree 39/2017 in March 2020. This means that for a product to be legally sold, it must have its information published on the Ministry of Agriculture and Rural Development’s portal, and must have an animal quarantine certificate from the Department of Animal Health because it contains animal-derived ingredients, before undergoing quality inspection and customs clearance. When veterinary procedures are integrated into the National Single Window Mechanism, post-inspection becomes much easier than before. The consequence in the next three to five years is that smuggled goods will gradually lose their foothold in organized channels. Dealers should consider this good news and prepare by requiring suppliers to present official import documents for each Pet Food product line they sell.
Third change: price management is a core competency for Pet Food distributors.
The third change, though less discussed, is crucial for the survival of a Pet Food distribution system. With shrinking retail profit margins and publicly available pricing, just a few price-cutting outlets can demoralize the entire network. Therefore, the core competitiveness of distributors in the coming period will no longer be large warehouses or extensive product lines, but the ability to protect prices across the entire system. This requires specific tools: a floor price for each product line, volume-based discounts instead of emotional negotiations, a zoning mechanism, and real penalties for violating outlets. Any distributor that fails to do this will lose its best dealers first, as these dealers are the ones who invest the most in their outlets and suffer the most when prices fluctuate. Dealers should proactively request that suppliers publish their pricing policies in writing and establish a channel for reporting violations.
Fourth change: omnichannel is about role assignment, not replacement.
The fourth change lies in how the channels coordinate. According to Mordor Intelligence, the online channel is the fastest-growing channel in the industry with a compound annual growth rate of approximately 9.33%, while specialty stores, including pet shops and veterinary clinics, still account for about 72.44% of revenue. These two figures are often misinterpreted as a substitution, but in essence, it’s a role-playing shift. Low-value, easily standardized products flow online; large-scale main food items and products requiring breed-specific and health-related advice still flow through physical points of sale. In the next three to five years, pet food distribution will be designed to be more standardized: each channel will have its own role, pricing structure, and even its own packaging structure to avoid direct comparisons. Dealers should leverage online content to reach customers within their radius, then convert them into repeat orders at the point of sale.
Fifth change: the category shifts to feline and functional nutrition.
The fifth change directly impacts inventory structure. Data from Mordor Intelligence shows that the pet cat category is growing at approximately 8.27% annually, while the nutritional supplements and functional products category is growing the fastest in the industry at 11.62% annually. These two trends are amplified by the increasing anthropomorphism of pets and the premiumization of products in major cities. In a pet supply chain, the consequence is that product portfolios must change before the market forces them to, as inert imports will become slow-moving inventory and consume working capital. Distributors will need to increase the proportion of cat products, expand the range of probiotics, omega-3s, and functional products, and provide training to dealers on how to advise on these product lines. Dealers should start by reviewing sales figures for the past twelve months by pet category, determine the current proportion of cat products, and then set targets for gradual increases each quarter.
Sixth change: fewer dealerships, but each one is bigger.
The sixth change is selectivity. Currently, the market has many small outlets, each sourcing from multiple suppliers, none of which are deep enough to create a strong bond. This fragmented structure is costly for both sides: suppliers have to serve too many small accounts, and distributors don’t meet the sales volume requirements to benefit from favorable policies. Over the next three to five years, the logical trend is for the market to have fewer distributors, but each larger, deeply connected to a few suppliers instead of being spread thin across a dozen sources. In return for this concentration, distributors receive better discounts, regional priority, display support, and training. This is a strategic choice, not a matter of capital size. A pet shop with average sales could still choose to concentrate eighty percent of its orders with two suppliers with clear policies, and use the remainder to experiment with new product lines without disrupting its core structure.
The most likely scenario and the signs to watch for.
Combining these six changes, the most likely scenario is not a sudden shock but a gradual buildup. The insignificant middlemen—those who import and retail, lack proper documentation, and have no control over pricing—will be pressured from both sides and forced to withdraw first. That market share will shift to disciplined distributors and capable dealers. There are several signs to watch for to know how this process is progressing: suppliers begin to announce pricing policies and commit to not selling retail, import documents are provided automatically instead of requiring requests, the proportion of cat products in orders steadily increases, and industry trade fairs see more long-term distribution contracts than outright purchase and sale deals. Dealers should create a checklist of these four signs and scrutinize their suppliers every six months.
What should dealers prepare right now?
Preparing for the next three to five years doesn’t require large capital, only discipline. The first step is standardizing documentation: requiring and maintaining import documents, circulation permits, and quarantine certificates for each key product line, as this will be a minimum requirement, not an advantage. The second is reselecting suppliers based on three uncompromising criteria: official import, no retail competition with distributors, and genuine price protection mechanisms. The third is restructuring the product portfolio to increase the range of cat products and functional nutrition, gradually reducing slow-moving items. The fourth is investing in the consulting capabilities of sales staff, as this is a valuable asset that online channels find difficult to replicate and is why specialized retail channels maintain their leading position. Doing these four things a year early will create a significant gap with competing retailers.
How does Petkin position itself in the Pet Food distribution market?
Petkin is an importer and distributor of pet food, and the above forecasts form the basis of how we organize our operations. We chose a non-direct retail distribution model because we believe the value of an importer lies in strengthening the dealer network, not in stealing customers from their own dealers. Accordingly, our goods are sourced through official channels with complete documentation, clearly published and stable pricing policies, and support focused on product knowledge and portfolio structure. We also believe that the distribution of Pet Food in the coming period will reward consistency more than short-term agility. If you are a pet shop owner or dealer and want to build a supply chain for the next three to five years, now is a good time to review your partners and portfolio.