Regular Menu Chính – Mcdelivery™ Vietnam
Photo by Lyman Gerona on UnsplashWhen McDonald’s first arrived in Vietnam in 2014, it was received with a warm welcome.
Đang xem: Menu chính
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 to 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 to expand in Vietnam.
Reason 1: Mcdonald’s Fast Service Wasn’t Faster Than Vietnamese Cuisine
Photo by Matthew Hamilton on Unsplash
In Vietnam, 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 on-the-go.
Pho is a Vietnamese noodle soup that the local vendors can prepare in seconds. Generally, all they need to do is put the solid ingredients in a bowl followed by hot water and other liquid ingredients, such as broth.
Banh mi is a type of sandwich on a baguette, and it doesn’t take long for locals to cut a baguette and put the good stuff inside.
So McDonald’s unique 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
Photo 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 land 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 and drinks.
The locals didn’t want to settle for a limited range of items because they had a lot of options — a lot of ‘cheaper’ and ‘traditional’ options.
Reason 3: The Vietnam War Had Created Political Hurdles
Photo by Conner Baker on Unsplash
The Vietnam 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 stress disorder.
The severe bitterness between the U.S. and Vietnam 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.
In 1997, KFC’s opening marked America’s re-entry into Vietnam. This time, it wasn’t for war, but to share some delicious American food.
Xem thêm: thuê xe du lịch tại mũi né
However, there was a problem. During all these years when Vietnam 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
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 and 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 to 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 to the Vietnamese customers. Even though there are local adaptations in the menu, such as chicken rice and 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
Photo by Quốc Trung on Unsplash
Not adapting well to the local culture is why Starbucks failed in Australia and KFC failed in Israel.
Although the locals like a quick pho from time to 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 and share 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 to share. Secondly, the ‘eat fast and make room for new customers’ type of culture that fast-food chains have doesn’t really match with the ‘sit back, relax, and share your food’ culture of Vietnam.
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 and getting a sizeable portion of the pie is a whole different story.
McDonald’s has to 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 Iceland, but the lack 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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