The changing habits of modern society has brought new development motivations for the food and beverage (F&B) industry, resulting in 50% of recent franchising cases in Vietnam being in the F&B sector. To find opportunities for growth and enhance competitiveness, many brands have actively sought new markets to increase profits in the future.
SPREAD THE BELLS TO ANOTHER COUNTRY
In 2022, Trung Nguyen opened the Trung Nguyen Legend Coffee World store in Shanghai, marking a new step for the Trung Nguyen Group in the Chinese market. By July 2023, the second Trung Nguyen store was opened at the One East shopping center in Shanghai. In September 2023, Trung Nguyen officially opened its first Trung Nguyen Legend store in Westminster, California, USA. The store serves various types of coffee, such as Legend coffee, coffee No. 1, 2, 3, 5, 8, Italian coffee, egg coffee, salt coffee…
Similarly, in 2023, Cong Caphe brand opened its first store in Toronto, Canada, marking its third international market. Just at the beginning of 2024, the brand also opened another branch in South Korea, bringing the number of stores in this country to 17. Currently, Cong Caphe has a total of 21 stores outside Vietnam.
Also in 2023, Coffila entered the Kuwait Gulf market, a place that is unfamiliar to Vietnamese people, but holds a lot of potential. The first foreign store of Coffila officially welcomed guests in October 2023, located on the first floor of the Al-Kout Beach Hotel, Ahmadi province. This is also the first Vietnamese brand to enter this country. In Vietnam, Coffila is not a prominent name in the F&B industry, but it is supported by the Minh Tien Coffee Group – a company specializing in exporting high-quality arabica coffee.
In addition, according to businessman Tran Nhat Vu, representing Phuc Tea, the brand has successfully signed a Master Franchise agreement in the Southeast Asian and Philippine markets. The brand, which specializes in turning various agricultural products into trend-setting beverages, plans to open 100 stores within 5 years and officially launch in Manila in the first quarter of 2024. “To achieve this result, we have gone through a long journey to bring Vietnamese beverage brands to the international market,” said Mr. Vu.
Like beverage brands, some pastry and food brands are also actively seeking to enter new markets. In August 2023, the US Consul General in Ho Chi Minh City Susan Burns visited the ABC Bakery factory in Binh Tan District (Ho Chi Minh City) and was introduced to the US-Vietnam Mooncake series by the “bread king” Kao Sieu Luc. The brand hopes to introduce to consumers in both countries cakes that combine high-quality ingredients from the US, such as blueberries, almonds, cream cheese, with Vietnamese dragon fruit.
COMPETITIVE POTENTIAL
It can be said that franchising activities in some countries are contributing to changing the retail market. According to the World Franchise Council (WFC), the Chinese franchising market is one of the largest and fastest growing in the world. As of 2023, according to the translation of the Vietnamese Retail and Franchise Business School, China has about 2,400 franchised brands and 1.3 million franchise stores.
In Vietnam, although Phuc Tea is not a famous or large market share company in the industry, the brand still finds opportunities to tap into potential markets outside of Vietnam due to its niche market direction. Based on surveys, the Phuc Tea team assesses that consumers in Southeast Asian countries have a certain preference for foreign brands, coupled with products that have unique characteristics and understand the customers’ taste, small businesses still have a chance to compete and replicate.
According to Mr. Nguyen Huu Long (Thich Nhan Chuoi), founder and managing director of the Vietnamese Retail and Franchise Business School, understanding the market is the first barrier to understanding the needs of consumers, their behavior, shopping culture, so that it is suitable and still retains the unique features of the model brought from Vietnam.
Generally, traditional brands with Vietnamese identity are generally successful when entering international markets because they have competitiveness, uniqueness, and novelty in their products. Vietnamese cuisine is also quite rich and favored by international friends, so the F&B industry has great potential when bringing brands to the international market.
Meanwhile, for manufacturing and export brands, online export is one of the “bright paths” for small and medium-sized enterprises in the F&B industry today. Especially with limited resources, companies should promote online export channels as it is both a trend and an opportunity. The advantage of online export in this field is that online marketplaces are not limited by time and space, thereby giving businesses more opportunities to expand their markets.
According to Mr. Kao Sieu Luc, what is important is that businesses need to always be ready so that when partners make requests for orders, the business can fully and quickly meet those requirements. In addition, in the international F&B market, the trend of consumers paying more attention to indigenous products, products with plant-based, organic, or health-friendly ingredients is increasing. This is also an opportunity for Vietnamese businesses to leverage their advantages in response to this trend.
Information at the CEO Forum: “Breaking barriers and expanding the F&B market” in November 2023 shows that in order to meet a series of new criteria for protecting the health of consumers and the environment, the common point is that manufacturers or restaurant chains must focus on sustainable development factors. Businesses should switch to renewable energy, use low-emission raw materials, take advantage of biomass fuels, reduce food loss and waste… Along with that is strengthening quality management, voluntary compliance and close monitoring of compliance with environmental and social regulations of suppliers.
