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Current Position:Home » News » Frozen & Deli Food » Topic

Fast food outlets grow presence in Vietnam

Zoom in font  Zoom out font Published: 2012-09-26  Authour: Helen Clark  Views: 40
Core Tip: A fashion for eating in branded fast food outlets, such as America’s KFC, is helping to drive increased meat consumption in Vietnam, where pork remains king but chicken dominates menus in quick meal chains.
A fashion for eating in branded fast food outlets, such as America’s KFC, is helping to drive increased meat consumption in Vietnam, where pork remains king but chicken dominates menus in quick meal chains.

Per capita daily consumption of meat rose from 51g in 2000 to 84g in 2010, the country’s National Institute of Nutrition reported recently.

Rapid economic growth and a rising urban middle class have enticed foreign chains in recent years. Market leader KFC, in-country since 1997, opened in Hanoi in 2006 and now has 100 restaurants in Vietnam, and plans a doubling that level by 2015.

“The younger generation… is more worldly, more aware of international brands, and aspires to be more modern, which helps the popularity of internationally-branded fast food chains,” Adam Sitkoff, executive director of the American Chamber of Commerce in Hanoi told GlobalMeatNews.

“Many Vietnamese people desire sitting in a Starbucks with their iPad, or taking their children to a McDonald’s,” he added, metaphorically, as McDonald’s is not yet in Vietnam.

Market analyst Euromonitor reported last year that in 2010, “fast food continued to display impressive current value growth of 13%, to reach VND7.1 trillion (US$3.4bn)”. This is despite cycles of cripplingly high inflation since 2008 – 23% in August 2011 but now closer to 6% – amid fears that it will rise again.

One reason for continued growth is that companies have tried to maintain affordable prices. Another is that the middle and upper classes have not been hit as hard and are more likely to forgo luxuries than dining out with friends, family, or colleagues, which is deemed a culturally important necessity in Vietnam.

Meat is no longer an occasional treat but a staple on many tables most nights in cities and some country areas. Vietnam’s famed street food has changed.

Hanoi-based Australian chef Tracey Lister wrote two cookbooks on Vietnamese food and first visited in 1994. “Back then, a com binh dan (worker’s rice buffet) was just water spinach, tofu, maybe some pork and more water spinach. Now there are many more options,” she said.

The rise of fast food chains is another reason why more meat is eaten than is produced domestically. The Ministry of Industry and Trade said in August: “This year, total domestic demand for all meat products will increase 6.5% to 7% to 2.9 million tonnes. A resultant shortfall of 90,000t to 100,000t… will need to be imported.”

Pork consumption is three times greater than poultry and six times that of beef and veal. For example, cheap pork kebabs are a staple of students, who buy them typically from food stands for a dollar or two. In the fast food chains, though, chicken-based food is leader.

The story continues. Ho Chi Minh City’s (HCMC) Thanh Nien News cited Di Nguyen, marketing manager for Domino’s Pizza in the city, as saying that Vietnam and HCMC held “big potential”, given their youthful populations. There are five Domino’s in Vietnam and the company plans another 20 over five years.

In Hanoi, KFC’s first store was in a suburb, while Filipino fast food brand Jollibee chose a far-flung rural district. The new restaurants are “nicer”, somewhere to go “for a date”, said Doan, a 30-year-old office worker in Hanoi.

Health and obesity are growing issues, yet fast food does not hold the same connotations as it can have in the West: cheap, poor-quality food for poorer people.

Euromonitor found KFC had the largest market share followed by Lotte then Jollibee. Lotte, ultimately part of Japan’s Lotte Group, has Vietnam interests including malls, café chain Angel-in-Us, and Lotteria, a chain specialising in fried chicken at least 33% cheaper than KFC. Others in-country include American chains Pizza Hut, Pizza Inn, Subway and Carl’s Jr.

Jollibee serves fried chicken, burgers, and rice and noodle dishes. Burgers caught on relatively recently. America’s Burger King is at Danang and HCMC’s international airports, and an outlet for Hanoi is slated for October. Burger King holds seventh place in the Vietnamese fast food market, according to Euromonitor.
McDonald’s is “missing out on a big opportunity”, said Sitkoff. An unconfirmed report in the US suggested the golden arches would appear in Hanoi soon, but there has been no word of this in local media.

VietMac Rice Burger, a Hanoi local chain, is a recent addition, serving beef, chicken, pork, fish or seafood patties, served in compressed rice rather than a bread bun. It serves vegetables and a light soup with meals, adding a Vietnamese dimension.

Offering an international experience tailored to location has helped brands succeed: KFC has offered a lime, salt and chilli seasoning, found across Vietnam.
“I suspect we will continue to see more and more brands here in the future and that Vietnamese people will continue to seek aspirational brands,” said Sitkoff.

 
 
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