The CEO of a famous fish sauce company in Phan Thiet said that the first 10 month revenue of this company declined by 25-30% over the same period last year, the sharpest drop ever.

"The situation this year is worse than last year. It seems that consumers are no longer interested in traditional fish sauce because of the abundance of industrial sauce, with big promotional campaigns," he said.

He said only customers who had good understanding about fish sauce were willing to buy traditional products. The majority of consumers focus on cheap products that have big promotions. In the past two years the company’s traditional products have been knocked out by industrial sauce at grocery stores and traditional markets.

"To make traditional fish sauce, we have to buy salt one year before. For example, for fish sauce produced in 2015 we had to buy salt from 2013. After one year, the smell of magnesium in salt will go away. The salt is then used to mix with fish from April to August. With such effort how can we sell our products at a cheap price?" he said.

For industrial fish sauce, producers only purchase pure fish sauce and mix it with spices to produce thousands of liters of sauce a day. Thus, the price is very competitive. In many areas, industrial sauce is sold for only VND8,000 a liter.

The director said that his products are available at all supermarkets but he had to pay a big discount to supermarkets, up to 25%. The firm is promoting exports to the US, with four containers/month on average, but the trademark belongs to the distributor.

Also experiencing difficulties and pressure after the drop in purchasing power, the famous fish sauce brand of Phu Quoc Island – Khai Hoan – is no longer sold in supermarkets in Vietnam.

"Previously we supplied our products in Aeon Mall but then we withdrew from this system because they asked for high discounts, while the sales were not high,” Khai Hoan’s representative said.

He added that in the domestic market, Khai Hoan products are not favored because of a lack of big promotional campaigns.

"To make the fish sauce of high quality we have to select fresh and good fish so the cost is many times higher than industrial fish sauce. Our products are also hurt by fake Phu Quoc fish sauce brands," he said.

Recognizing big difficulties for traditional sauce businesses on Phu Quoc, the island district leaders said the number of traditional fish sauce production facilities have been gradually reduced. Many facilities could not compete with large corporations so they had to shut down or become the providers of pure fish sauce to these corporations, which was used to make industrial sauce.

"In fact, consumers are being cheated because some kinds of industrial fish sauce have similar prices as traditional sauce. Customers are keen on nice design and big promotion so they chose poor quality products," said an official of Phu Quoc.

At major supermarket systems in Vietnam like Big C, Co.opmart, Aeon Mall,and Metro there are a few dozen products of fish sauce with many brands and most of them are industrial products. 

According to the General Statistics Office, each year Vietnam consumes more than 200 million liters of fish sauce with total sales of over VND7,000 billion (nearly $350 million). Of these, up to 150 million liters of fish sauce are industrial product, equivalent to about 75%. This figure will increase if consumers gradually turn away from the traditional sauce. Currently, most of the fish sauce market is in the hands of large corporations.

Not only fish sauce producers on Phu Quoc, the most famous place for fish sauce in Vietnam, but also businesses in Nha Trang and Binh Thuan are facing difficulties.

One liter of pure fish sauce is sold to industrial fish sauce manufacturers for VND30,000-VND50,000 to mix with 5 liters of industrial sauce, priced VND20.000-VND25.000/l. The disparity in price hurts the traditional fish sauce market. To hold and further conquer the market, large firms are aggressively spending on promotion and marketing, which accounts for 50-60% of the profits.

"Only if consumers are aware of the quality of products, change their habits and the manufacturers of traditional sauce retain credibility, then the fish sauce market will be re-divided", an expert said.