Over 50,000 Cafés and Eateries Shut Down

iPOS.vn Joint Stock Company, a leading provider of specialized management solutions for the F&B industry, released its Vietnam F&B Industry Report for the first half of 2025 on October 10th. The report reveals a significant decline of over 50,000 F&B outlets compared to the end of 2024.

Currently, there are approximately 299,900 F&B establishments nationwide, representing a 7.1% decrease. Hanoi and Ho Chi Minh City experienced even steeper declines, exceeding 11%, highlighting the fierce competition in these two megacities.

The trend of “quick openings, quick closures, and quick learning” is prevalent among smaller F&B businesses. Many experimental models operate for 2-3 months before shutting down due to financial constraints or a lack of market potential, particularly those that emerged during the recent surge in small-scale F&B ventures.

The report clarifies that during the first half of 2024, approximately 30,000 F&B outlets closed (a 3.9% decrease). However, new openings in the latter half of the year offset these closures, resulting in a total of 323,010 outlets by the end of 2024. This pattern suggests that the first half of the year typically serves as a “natural filtering” period, followed by a more robust cycle of new openings and restructuring in the second half.

While weaker players are being eliminated, leading brands are restructuring their portfolios by abandoning underperforming locations, relocating to iconic spots, and enhancing customer experiences.

Starbucks exemplifies this cycle. After closing its Starbucks Reserve Han Thuyen location in August 2024, the brand reopened a Reserve store in a prime location at Bitexco Financial Tower in Ho Chi Minh City and launched a new Reserve-only store at Diamond Plaza on Le Duan Street, emphasizing elevated spaces and services over widespread expansion.

The trend of closing underperforming locations to open more iconic ones indicates that the current market purge is freeing up prime real estate (Class A/B) and creating opportunities for well-capitalized, operationally strong brands to thrive.

The report also highlights that while 55% of brands have increased prices, only 7.7% of consumers are spending more, and 38% are cutting back on expenses.

Notably, 61% of customers remain loyal to their favorite establishments despite price increases. This underscores the market reality: consumers don’t abandon brands because of higher prices but because they perceive the value as no longer worth it.

In Ho Chi Minh City, as reported by Nguoi Lao Dong Newspaper, the 21-year-old Bready Fresh Bakery chain closed its doors in early October, leaving many customers nostalgic.

This year has also seen the exit of several brands, including Vua Cua Express, 18 Degrees Below Tea, Alo Tea, Hot&Cold, and April Tea House, underscoring the cutthroat nature of the F&B industry.

Culinary experts note that the industry is becoming increasingly competitive, demanding greater professionalism. However, the F&B sector always has room for innovative models that adapt to evolving consumer needs.