Global franchises appear on the Vietnamese scene

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Vietnam is showing huge potential for franchising with dozens of franchises being established and more new brands popping up all the time. Sean T. Ngo, managing director of VF Franchise Consulting, a leading franchise and licensing consultancy in Vietnam spoke with VIR about this rising trend.
Vietnam is attracting more international brands that are exploring the market. What significant trends are expected to emerge from franchising in the coming time?
The food and beverage sector continues to be the most popular trend in franchising and will continue to be with Little Caesars and Grimaldi’s Coal Fired Pizzeria both aggressively targeting Vietnam. The popularity of milk tea is another big trend, with Presotea’s made to order fresh tea expected to see rapid growth.
As parents want better futures for their children, education and training franchises such as The Edge, which specialises in preparing students for SAT tests and entry into the top colleges in the US, are becoming more popular as well.
We are seeing a larger number of fashion, beauty, and pharmaceutical franchises exploring the landscape in Vietnam, following in the footsteps of Zara and H&M expected to make its debut in Vietnam in 2017. As the schedules of consumers become increasingly hectic, lifestyle brands such as domestic cleaning and laundry services will start to proliferate, along with fitness brands such as Title Boxing Club. One of the bigger trends as seen in more developed franchising countries is the explosion of 24-hour fitness franchises – exercise facilities open all day and night.
Vietnam’s strong GDP growth, coupled with the growth of the middle class, makes Vietnam an attractive market not only for smaller brands, but for high-end luxury brands as well.
How do you assess franchising in Vietnam over the past few years and how well have Vietnamese franchisees performed?
Vietnam has seen a meteoric rise in the number of franchise brands, many entering post haste with bold expansion plans – McDonalds and Starbucks to name just a few. Since 1990, when franchising began to gain ground with brands such as KFC, Lotteria, and Jollibee, the number of brands registered in Vietnam has grown to 145. Their success is based on products that set them apart from local competitors. Brands with proven operational systems that can be applied internationally will usually always perform well. As franchisees develop their knowledge and build capacity, we will continue to see growth in this sector. With the economic climate being favourable, consumer demand for popular international brands on the rise, and business acumen of investors increasing, it would not be surprising to see a boom in franchising like that of the Philippines, which has over 1500 registered franchises.
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what specific foreign brands are looking for franchising in Vietnam? What are their strengths?
There are many featured brands are seeking partners for franchising in Vietnam. Specifically, Little Caesars – the third largest pizza chain in the US and the largest carry-out only chain globally, bringing to Vietnam their concept of fresh, never frozen, always ready pizza; Element Fresh – the largest fine casual dining brand in China offering gourmet fresh foods which are wholesome, nutritious and flavourful; Presotea – a Taiwanese tea concept which has developed a unique way to brew tea fresh to order every time to bring out the natural sweetness of the tea leaf; Grimaldi’s coal fired pizzeria – a New York firm with a history of over 100 years serving traditional Napoli style pizza; and Boiling Crab – which brings Southern American style seafood to Asia.
These brands will be presented by the franchisors themselves, who are available for confidential one-on-one meetings on the day of the event. There will also be a representative of Tilleke and Gibbins, who will provide advice on franchise laws in Vietnam.
By Phuong Thu (VIR)

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