According to a report by iPos.vn, as of June 2024, Vietnam recorded approximately 304,700 F&B stores in operation, a 3.9% decrease compared to 2023 figures. At least 30,000 stores nationwide have closed, along with a limited number of new openings.
SHORT-TERM CHALLENGES
Since the beginning of 2024, F&B businesses in Vietnam have experienced significant fluctuations in revenue. Although the year started with positive signals, the downward trend became evident by mid-year. As a result, companies are becoming more cautious about expanding their operations in the remaining months.
In a survey by iPos.vn, 61.2% of businesses aim to maintain their current scale, while 34.4% plan to open new outlets. This is compared to 51.7% of F&B businesses with similar ambitions in the same period last year.
Commenting on the F&B market situation in the first half of 2024, Mr. Vu Thanh Hung, CEO of iPOS.vn, shared that the strong fluctuations have presented challenges for the entire service industry, especially F&B. “However, Vietnamese F&B enterprises have demonstrated remarkable agility by quickly adjusting their operations, cutting unnecessary costs, and optimizing cash flow,” he added. “At the same time, continuous creativity in product development has offered novel dining experiences, attracting a large number of customers.”
The economic difficulties have not dampened the Vietnamese people’s love for cuisine. Instead of reducing their spending on dining out, many Vietnamese try to maintain their frequency of eating out but plan their expenditures more carefully. According to iPos.vn’s survey, the proportions of people dining out at high frequencies (3-4 times/week, daily) remain almost unchanged from 2023. Meanwhile, the group dining out 1-2 times/week showed an increasing trend (about 4.1%) compared to 2023. Overall, loyal customers have maintained their dining habits. This indicates the strong appeal of the F&B industry.
Despite the challenges, the total revenue of the F&B industry in Vietnam in the first six months of 2024 reached a surprising VND 403,900 billion, equivalent to 68.46% of the revenue for the entire year of 2023. According to Vietnam Report’s survey from July to August 2024, 62.5% of businesses expected the F&B industry to grow by 5-10% in 2024.
Notably, the optimism of enterprises about the F&B market’s prospects increased significantly, rising from 61.6% to 87.6%. This optimism is reasonable, given the Ministry of Industry and Trade’s data, which forecasts a 10.92% growth in F&B revenue in 2024, reaching over VND 720,000 billion.
The positive signals for the F&B industry’s improvement also come from consumers’ financial situation. Vietnam Report’s 2024 F&B Consumer Survey showed that up to 52.7% of consumers believe their income will improve slightly, and 21.8% expect a significant improvement in the next 12 months.
Mr. Taku Tanaka, founder and CEO of Kamereo, a comprehensive B2B fresh food and supplies provider with prominent partners such as Paris Baguette and Pizza 4P’s, noted in a discussion at the recent Flavors Vietnam 2024 workshop: “While the Vietnamese F&B industry may face short-term difficulties in specific locations, I still see significant long-term potential, especially as consumers’ income continues to rise.”
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