MCDONALD VIỆT NAM

Photo lớn by Lyman Gerona on UnsplashWhen McDonald’s first arrived in Vietphái mạnh in năm trước, it was received with a warm welcome.

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The locals waited in long queues to tantalize their taste buds with a new breed of burgers. A whopping 400,000 customers happily spent their money on this new sensation in the first month itself.

It seemed like McDonald’s was going khổng lồ be a big thing in this East Asian country. However, in business, the reality is often different than predictions.

As of now, McDonald’s only has around 22 outlets in the entire country. Let’s take a look at why the company stagnated and failed lớn exp& in Vietphái nam.


Reason 1: Mcdonald’s Fast Service Wasn’t Faster Than Vietnamese Cuisine
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Pholớn by Matthew Hamilton on Unsplash

In Vietnam giới, the concept of fast-food has existed for a long time. Whether it’s pho or a banh mi sandwich, the customer had local options that they could have sầu on-the-go.

Pho is a Vietnamese noodle soup that the local vendors can prepare in seconds. Generally, all they need to lớn bởi vì is put the solid ingredients in a bowl followed by hot water & other liquid ingredients, such as broth.

Banh mi is a type of sandwich on a baguette, and it doesn’t take long for locals lớn cut a baguette and put the good stuff inside.

So McDonald’s quality selling point — that is, offering fast service — didn’t even matter because the locals could get faster service from traditional Vietnamese food outlets.


Reason 2: The Local Competition Was Tough
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Pholớn by Harvey Enrile on Unsplash

As of 2018, there were around 540,000 food outlets in Vietnam — almost 430,000 out of which were local vendors.

For decades, there has been a flourishing street-food culture in this country. Food is readily available, whether it's on lvà or water. Yes, you can even buy food from vendors who run their business from a boat (as shown in the picture above).

Compare this with McDonald’s — a fast-food restaurant that has a menu mostly comprised of burgers và drinks.

The locals didn’t want lớn settle for a limited range of items because they had a lot of options — a lot of ‘cheaper’ & ‘traditional’ options.


Reason 3: The Vietnam giới War Had Created Political Hurdles
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Photo lớn by Conner Baker on Unsplash

The Vietphái nam War was one of the most devasting chapters of mankind’s recent history. Many passed away, and some of the people who survived lived with physical injuries or post-traumatic găng disorder.

The severe bitterness between the U.S. & Vietphái nam closed trade for many years. But in 1995, the leaders of both nations decided to bury the hatchet and re-open their doors for commerce.

Xem thêm: Giám Khảo Giọng Hát Việt Nhí 2017, Đổi Mới Có Tạo Sự Bứt Phá?

In 1997, KFC’s opening marked America’s re-entry into Vietphái mạnh. This time, it wasn’t for war, but khổng lồ mô tả some delicious American food.

However, there was a problem. During all these years when Vietphái mạnh didn’t allow American businesses to enter their country, the gap in the market for food outlets was filled by local business owners.

For this reason, American franchises struggle when entering a jam-packed Vietnamese market to this day.


Reason 4: McDonald’s Used the Western Pricing Strategy in the East
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Photo by Andrew Leu on Unsplash

As of today, a Big Mac in Vietnam costs $2.82. It seems reasonable if you’re living in the West và earning a Western income. However, for the local customers, this is a premium price and something they’d only spend every once in a while.

According to Numbeo, a meal at a local Vietnamese restaurant costs around VND 50,000 ($2.16), whereas a meal at a McDonald’s outlet can range up lớn twice as much, which is VND 100,000 ($4.32).

The idea of paying double for a burger, a glass of Coke, and some fries didn’t appeal lớn the Vietnamese customers. Even though there are local adaptations in the menu, such as chicken rice và grilled pork rice with egg, the vast majority of customers weren’t financially prepared to visit McDonald’s frequently.


Reason 5: McDonald’s Menu Didn’t Coincide With the Local Culture of Sharing Food
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Phokhổng lồ by Quốc Trung on Unsplash

Not adapting well to lớn the local culture is why Starbucks failed in nước Australia and KFC failed in Israel.

Although the locals lượt thích a quichồng pho from time to lớn time, that’s not what they always eat. In the Vietnamese tradition, it’s not uncommon for the whole family (or a bunch of friends) to sit together và giới thiệu their food with each other.

First of all, burgers can’t be shared unless someone’s OK with teeth marks on the bun. In short, no, burgers are not the type of food that most people would want khổng lồ share. Secondly, the ‘eat fast and make room for new customers’ type of culture that fast-food chains have sầu doesn’t really match with the ‘sit baông chồng, relax, and tóm tắt your food’ culture of Vietnam giới.


Conclusion

Entering crowded markets can be extremely challenging — whether you’re a self-employed freelancer or an enormous corporation.

It’s easy to enter a market, but sustaining a business và getting a sizeable portion of the pie is a whole different story.

McDonald’s has khổng lồ compete with hundreds of thousands of local businesses with around a couple dozen of its outlets. Not that they’re retreating from the country like they withdrew from Icel&, but the lachồng of growth is not a good indication for the company’s future.

What are your thoughts on the future of McDonald’s in Vietnam?


Leo Saini



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