Tough take: People ride motorbikes on a street in Hanoi. Despite clear advantages, the franchise strategy still has limitations and many food and beverage businesses are reluctant to engage with the model. — AFP
HANOI: Franchise is becoming a popular business model in the domestic and international food and beverage sector.
However, although many brands have made a name for themselves thanks to their franchise chain, many companies are still not interested in it as a business model.
According to a survey conducted by Vietdata, Vietnamese consumers increased their spending on eating out, up by between 5% and 10%.
About 14.9% of customers are willing to spend more than 100,000 dong for dinner every day, 3.5 times higher than in 2022.
A report by Kirin Capital on the outlook for the sector showed that the market value of Vietnam’s food and beverage industry in 2024 is expected to increase by 10.92% compared to 2023, reaching more than 655 trillion dong.
To achieve this number, food and beverage businesses do not simply focus on providing meals and drinks, but must also have creativity, flexible management and operations to overcome market challenges and competition.
One attractive way to do that is to follow the franchise model, also known as franchising.
Ma Hai bread brand, 10 years after starting the business, has become the largest bread brand chain in Vietnam, with about 1,000 franchise partners nationwide.
Co-founder of the brand, Doan Van Minh Nhut, said that the next goal is to expand the number of partners to 10,000. And after that it will be able to offer the Vietnamese bread brand to the world, again through franchising.
SIBA Food’s BAF Meat has been looking for franchise business partners, who can supply the necessary equipment to offer the brand.
Franchise is also a strategy of foreign businesses in the Vietnam food and beverage market.
After four years in Vietnam, South Korean retail convenience store brand GS25 owns 200 outlets, focusing on the southern markets in Ho Chi Minh City, Binh Duong, Vung Tau and Dong Nai provinces.
GS25 recently accelerated chain expansion through cooperating with HDBank, whereby it weighs in with 1.6 billion dong per GS25 store.
Ranked second in terms of market share in Vietnam, after Pizza Hut, is Domino’s Pizza.
Through the franchise model and managed by Vietnam Food and Beverage Services Company Ltd under the IPPG Group, Domino’s now has more than 50 stores in nine provinces and cities across the country, serving nearly 10 million customers each year. — Viet Nam News/ANN
