11:42 | 04/02/2016 Economy
Vietnam’s food market is at its busiest ever, as investors are pouring into the industry on the back of local people’s increasing demands for food and beverages.
Illustrative image (Source: VNA)
According to Theodore Knipfing, Director of Retail Tenant Representation in the Asia Pacific Region for Cushman & Wakefield – a global leader in commercial real estate services, food demand in foreign countries is saturated. So they have to look to new markets, and Vietnam is very attractive thanks to its young population, people’s increased income and rapid urbanisation, he said.
Whilst studying the consumption trends of young Vietnamese, fast food suppliers have found that the domestic food industry still thrives, despite the ups and downs of the economy. Therefore, major brands have set food retail as a priority business in the Southeast Asian nation. QSR Vietnam of the Dairy Queen group – part of Warrant Buffet’s Berkshire Hathaway Inc, for example, last month announced that it will open a second DQ Grill & Chill fast food outlet in Ho Chi Minh City.
John Gainor, President and CEO of International Diary Queen, Inc. (IDQ) – a subsidiary of Berkshire, said IDQ now has 21 DQ-branded restaurants as joint-ventures with QSR Vietnam in a little over a year. The figure is expected to climb to 60 by 2019.
The presence of the world’s top fast food brands has turned the Vietnamese market into a fierce competition which is currently being driven by KFC and Lotteria.
QSR said that apart from its typical dishes, the company have also developed a new range to suit local tastes and ingredients, thus raising the competitive edge of their products.
Also, the US’s Starbucks Coffee entered the Vietnamese market at the end of 2013, putting it in competition with brands such as The Coffee Bean and Tea Leaf, Gloria Jeans Coffee, Highlands Coffee and Trung Nguyen Coffee.
McDonalds have five restaurants in Ho Chi Minh City, but within the next decade it hopes to have 100 more spots to sell its Big Macs and compete against KFC, Jollibee and Lotteria for a share of the market there.
Joining the trend, domestic businesses have also professionalised their production with attention paid to product appearance and service quality in order to increase the value of traditional local dishes.
These perse products and services have enabled Vietnamese consumers to experience various new cuisines. Young people, which make up 70 percent of the population, have created a promising market for service investors./.