Fast food chains’ development has slowed down
VietNamNet Bridge - The closure of many fast food shops in recent days has raised a question if the Vietnamese fast food market has become saturated and no longer attractive.

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The latest survey by FT Confidential Research found that Malaysians and Thais are consuming less fast food. However, in Vietnam, fast food is still favored by young people.

Since the demand for fast food has not increased in Malaysia, the Philippines and Thailand, fast food chains have to look for new markets. Vietnam is one of these. FT Confidential Research believes Vietnam is a market with great potential with fast food consumption here still lower than other countries.

The latest survey by FT Confidential Research found that Malaysians and Thais are consuming less fast food. However, in Vietnam, fast food is still favored by young people.

Jollibee, for example, said it was looking for individual franchisees with the fee of VND4.5-5 billion. The Filipino chain has been present in Vietnam for 10 years and has 70 shops in many provinces and cities. 

Don Chicken, which only has one shop in Vietnam so far, has also announced it is looking for a franchise partner.

According to the Ministry of Industry and Trade (MOIT), the ministry has allowed the franchising of 148 foreign brands in the last eight years. These include 43.7 percent of franchise deals (42 brands) in the restaurant, food and beverage sector.

Meanwhile, Nguyen Phi Van, president of Asia Retail & Franchise, said about 40 foreign brands are looking for Vietnamese partners to franchise.

Burger King has drawn special attention after closing some restaurants recently. In mid-February, it closed a restaurant in Tan Binh district in HCM City. In 2015, it shut down two restaurants in HCM City and Hanoi. One year before, it closed one in Da Nang City.

Johnathan Hanh Nguyen, representative of the franchised company, affirmed that Burger King would not disappear in Vietnam, and that some shops have closed, but new shops will open.

However, analysts believe Burger King chain is meeting problems in Vietnam. Its major product is hamburger, which is not favored by Vietnamese, while the hamburger price is high. 

McDonald's, a rival of Burger King, made an impressive debut in Vietnam, but the number of customers has decreased.

A local newspaper conducted a mini survey and found that McDonald's mostly sells hamburgers, while there are few choices for fried chicken, which is favored by children. Meanwhile, the prices set by McDonald's are higher than its rivals Lotteria and KFC.

KFC, Lotteria and Jollibee have been in Vietnam much longer than McDonalds or Burger King. Analysts also commented that it is not a surprise that some shops have few customers. However, it is difficult to say if Burger King and McDonald’s can change the Vietnamese taste and familiarize them with hamburgers.

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