For those who are craving for McDonald’s Big
Mac and French Fries in Vietnam, those cravings can now be satisfied with the
franchise’s inaugural opening in Ho Chi Minh City, also affectionately known as
Saigon by the locals.
The man behind the brand’s introduction
into the Vietnamese market is none other than Henry Nguyen. To watchers of Vietnamese politics, he is instantly recognizable as
the son-in-law of Vietnam’s powerful Prime Minister Nguyen Tan Dung.
The new entrant joins the likes of other
Western and Asian fast food conglomerates, namely, KFC, Burger King, Pizza Hut,
Lotteria and Jollibean jostling for a share of the fast-growing Vietnamese consumer market. This is a reflection of the country’s rapidly changing
landscape - there was no access to American products 4 decades ago when the US-backed
government fell to the communist troop. Due to the liberalisation of its
economy in the 1990s, Vietnam saw an influx of western brands in its food fast industry
that was once limited to low cost traditional fast food.
The international chain has
already served over 400,000 customers and 61,980 Big Macs in its first month of
operations. A stellar performance by any measure, in a sector which is
projected to grow at an average 15% this year. With such promising statistics
in the midst of fierce competition, it is no wonder that McDonald has plans to
open 100 branches across the nation. Some also see this wave as a sign of
Vietnam’s rising affluence which is demonstrated by an average economic growth rate of 7% over the last 10 years – one of the fastest in Asia.
The American fast food
company reported in July 2014 that profits fell more than expected in the wake
of weak U.S and Europe sales while Asia-Pacific, Middle East and Africa
increased by 1.1%. In our opinion, expanding its foothold in rapidly developing consumer markets with a growing middle class, is
perhaps the best way forward for well-established and mature brands such as McDonald to increase its margins. Vietnam, so far, seems poised to be a big success story.
