Edward Eng

Business Development Manager

June 30, 2010

  • Share by Email
  • Tweet This
  • Share on Google+
  • Share on Facebook
  • Share on LinkedIn
  • Tweet This

McDonald’s & Starbucks in Vietnam?

0103-Starbucks-price-hike_full_600

subscribe

Everyone is talking about emerging markets these days and with all this talk we hear China come up a lot. However, David Rubenstein, a founding managing director of The Carlyle Group has made a good point. “If China, by the year 2035, is the biggest economy in the world, how much longer can you call it an emerging market?”

So, what is a true emerging market? CNN’s Andrew Stevens has recently reported on the growing economic might of Vietnam, particularly Ho Chi Minh. The city is booming and has been booming at an average annual growth rate of 7 percent for the past 10 years. More importantly, Vietnam is serious about drawing in foreign business.

We’ve seen electronics manufacturers like Samsung and Canon, big Asian carmakers as well as Ford, and tanning factories that produce shoes for Timberland all move into Vietnam. Why? It’s cheaper. There’s less state intervention when companies follow workplace and environmental standards. Plus, Vietnam has key access to a vast and cheap labor pool across the borders of Cambodia and Laos, according to Stevens.

But what about retail, particularly retail food? Here are some quick facts about retail food and market potential in Ho Chi Minh compared to its Chinese sister city, Shanghai.

What would the demographic makeup of the first McDonald’s in Ho Chi Minh look like?

McDonald’s trade area with an 1100m large radius would include a labor population of 75,544, a female population of 6,228, a male population of 59,125, and a total population of 124,703. To learn about Trade Zones, watch this quick video.

And Starbucks?

Starbucks trade area with a 900m large radius would include a labor population of 74,283, a female population of 5,985, a male population of 56,460, and a total population of 116,320.

And lucky for us, the trade areas of these two retail giants’ first locations in Vietnam overlap.

So what does a trade area analysis reveal?

Discussion Questions

  1. Will we see an emergence of foreign brands such as McDonald’s and Starbucks in Vietnam like we have in China? Why or why not?
  2. Where in Vietnam would you open the first McDonald’s?
  3. Where in Vietnam would you open the first Starbucks?

 

Also worth reading : 
How To Find The Right Mall For Your Brand
7 Popular Chinese Brand Chain Restaurants In China
Infographic – Emerging Starbucks

Comments

  • You should open a Mc Donald in Hoi An.I want to delegate them open it in my town

  • I sure have a KFC in Vietnam

    • Edward Eng

      Awesome. How’s business treating you?

  • Im Vietnames n I really really love Mc n Starbuck….I’ve hope that they would appear in VN for more than 3years but none…..
    Vietnameses r really love fast food n take away cafe ^^

    • Edward Eng

      Thanks for the comment, Hayo. What area in Vietnam would you like to see McDonald’s and Starbucks?

  • Hoang Phi Nguyen

    I would like to see a MC Donalds in Saigon-Ho Chi Minh City :) its a very big city and i often fly to that place so it would be good to have a Mc Donalds in VN.

    • Edward Eng

      Hi Hoang,

      Thanks for the comment. Where exactly in Ho Chi Minh City would you like to see a McDonald’s?

      • david

        Dong Khoi should be a good place to open Mc.

        • Edward Eng

          Hi David,

          Thanks for the comment. What makes you think Dong Khoi is a good place for a McDonald’s?

          -Ed

  • Hi Ed how do you do the trade area analysis, i don’t find this to be telling the story that i see here in vietnam where the women and men is the same if not higher. in fact if you mean the working population women would be much higher in numbers, that’s just a cultural fact.

    • Edward Eng

      Hi Andrew,

      Thanks for the comment. Trade area analyses as you might or might not know are done in many different ways depending on what you are looking for. The difference in the numbers might be owing to a number of factors. The actual number of females versus males might be a lot different than what you ‘see’ because people tend to travel to and from their workplace. As you probably already know, people in Asia might not necessarily work close to where they live. If you’d like, feel free to send me an email at edward.eng@getchee.com to discuss further.

      Cheers,
      Ed