Market Intelligence
Franchising Vietnam

Vietnam Franchising

Overview

Vietnam’s youthful population and growing middle-class offer opportunities for U.S. food & beverage franchisors. 

Leading Sub-Sectors

Vietnam’s Ministry of Industry and Trade estimates that food & beverage consumption accounts for 15 percent of GDP and is increasing year by year. According to Vietnam Report, revenue in this segment is projected to reach US$678m in 2025 and is expected to show an annual growth rate (CAGR 2021-2025) of 4.98%. In addition, user penetration is expected to hit 17 million by 2025. With strong Vietnamese consumer awareness of American food & beverage, U.S. fast food franchisors are key players in the market, notably McDonald’s, KFC, Starbucks Coffee, Burger King, Pizza Hut, Domino’s Pizza, Popeye’s Chicken, Texas Chicken, Baskin Robbins, and Coffee Bean & Tea Leaf.

Vietnamese consumers are responsive to high-end, well-known, and premium products and services. They often conceive Western brands with quality, opulence, and reliability. 

Besides the fast-food sector, the franchise convenience store model has also gained traction with various brands including Circle K, Family Mart, and Seven-Eleven expanding quickly in large cities. Circle K opened its first store in December 2008 and now it has expanded to more than 400 stores in Vietnam.

Opportunities and Challenges

  • 60% percent of the population is under 35 years of age, and per capita GDP is around $3,700 and, on the rise.
  • Over the next decade, 36 million more consumers may join Vietnam’s consuming class, defined as consumers who spend at least $11 a day in purchasing power parity (PPP) terms, according to recent McKinsey Global Institute research. 
  • American brands have a reputation for quality, especially in southern Vietnam. Best prospects for American franchisors include fast food, business services, health and nutrition, education services, health care, children’s services, cleaning and sanitation, hospitality, fashion, entertainment, and convenience stores.
  • According to Franchising.com, finding licensee candidates with established infrastructure, experience running a business, and capital is a problem. Retail space has become extremely expensive in Ho Chi Minh City and Hanoi. 

Contact

For more information about Vietnam’s franchising sector, please contact:
 
Mr. Thao Nguyen, Commercial Specialist
U.S. Consulate General in Ho Chi Minh City
E-mail: Thao.Nguyen@trade.gov

Ms. Ngan Thai, Commercial Assistant
U.S. Embassy in Hanoi
E-mail: Ngan.Thai@trade.gov

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