The coffee chain develops in a new situation
In the past few years, branded coffee chains have been born and imported into Vietnam, such as: Highlands Coffee, The Coffee House, Cong Coffee, Starbucks, Trung Nguyen Legend, Phuc Long Coffee and Tea, Gemini Coffee, Lofita Tea & Coffee, Viva Star,… The coffee market is expanding and is a potential market.
The participation of the “big” men
In mid-May 2020, a new brand of coffee chain was born, Ong Bau Coffee, with the support of 3 bosses: Bau Duc (Doan Nguyen Duc, Chairman Hoang Anh Gia Lai), Bau Thang (Vo Quoc Thang). , Chairman of Dong Tam Company) and elected Hai (Tran Thanh Hai, Chairman of NutiFood) were present in Binh Duong. Since its first appearance on the market, Ong Bau coffee chain has spread to dozens of provinces (HCMC, Long An, Tien Giang, Can Tho, Hue, Quang Ngai, Hanoi, Binh Duong). …) with nearly 100 points of sale.
Besides developing self-managed coffee shops, Mr. Bau also developed a franchise-oriented coffee chain under all three models: mobile cars, popular coffee shops and high-class coffee shops for young people. The goal of expanding the coffee chain to 1,000 stores right in 2020 is extremely feasible. Set an expectation to open 10,000 stores by 2025
Vinamilk’s “Coffee Dream”
At the last General Meeting of Shareholders, Vinamilk gave detailed information about the project of a chain of retail stores of coffee, beverages and some accompanying foods under the Hi-Café brand. However, as Ms. Mai Kieu Lien, CEO of Vinamilk, shared, the company does not pay for space rent but will take advantage of the 430 Vietnamese Dairy Dream stores that are present across the country to develop Hi-Café. At Hi-Café, Vinamilk plans to make coffee using Vinamilk’s ingredients, in which milk is the main and coffee is the secondary.
Nestlé’s Nescafé Hub prototype
After launching the first shop in Hanoi, Nestlé’s second Nescafé Hub has been opened in Ho Chi Minh City. This is considered a place for customers to experience all Nestlé products. Nescafé Hub is a kiosk-style, take-away cafe model, targeting the affordable segment and located in convenient locations such as office buildings, bus/subway stations, markets, right on the corner. , sidewalks, schools… Although Nestlé has not announced any further plans to expand the Nescafé Hub, looking at Nestlé’s Nescafé Hub chains in Thailand and Malaysia, one can predict the feasibility of the Nescafé Hub. Nescafe Hub model in Vietnam.
Re-dividing the market – Customer segmentation
In Vietnam, the coffee kiosk and take-away chain model has blossomed and created a new business model that brings high income and high efficiency. Guta is a typical example when sales increase about 200-300%/year. According to Guta CEO, Mr. Nguyen Minh The, “Guta expects to maintain this growth rate and expand its brand identity in the next few years”. According to the announced information, the company has nearly 60 stores, in all 3 models of stores, trolleys and kiosks, mainly in Ho Chi Minh City. Guta is planning to expand the chain to the Mekong Delta provinces and throughout the South.
Along with Guta, in the popular segment are a series of other coffee chains. Can include Trung Nguyen’s E-Coffee, with hundreds of stores of all kinds. Through a no-fee franchise model and relatively low initial investment costs (VND80-210 million/store), E-Coffee aims to expand the chain to 3,000 stores. Milano, Napoli Coffee has opened thousands of stores nationwide. Or Laha, Aha Cafe, Viva Star Coffee, Coffee Bike… are also rivals of new coffee chains.
It can be seen that the firms did not choose the high-end segment to convert. Because the high-end coffee shop model often costs a lot. That is also the reason why many foreign brands such as Burger King, Gloria Jeans & Tea Leaf and Caffe Bene fail in the Vietnamese market. In addition, according to brand expert Vo Van Quang: “Vietnamese consumers are looking to buy food and drinks as conveniently as possible”.
Catch the trend – Promote the development of the coffee chain
Highlands Coffee, one of the largest coffee chains in Vietnam, captures the new trends and tastes of Vietnamese people and also optimizes operations. Highlands Coffee has launched a take-away coffee campaign and found sidewalk cafes on some streets in Ho Chi Minh City. Or Passio, Vinacafé also set up morning coffee shops in some busy streets and tried to reach young customers.
This method is considered by experts to be flexible, creative and appropriate. In addition, Vietnam’s coffee and tea chain market has a size of about 1 billion USD/year (according to Euromonitor) but no name has gained an overwhelming market share (HighLands Coffee, Starbucks, The Cofee House, Phuc Long, China). Nguyen accounts for only 15.3% market share).
Newly-appearing coffee chains can also take advantage of the strengths of available raw materials to satisfy the needs of customers to enjoy quality coffee as well as control costs and prices. For example, NutiFood’s CaDa coffee farm, over 4,000 hectares, with a capacity of 11,000 tons of coffee per year promises to create a competitive advantage for the Ong Bau chain.
Or this chain can control the quality of the franchise chain by taking advantage of NutiFood’s team of 2,500 sales and market development staff. In particular, Kien Long Bank, where Thang was elected as Chairman, can play the role of supporting loans for those who want to join the Ong Bau franchise network.
In terms of brand, the resonance of 3 prominent figures in the football sponsorship village has helped the Ong Bau chain to be quickly recognized. That’s why Mr. Hoang Tung, owner of Pizza Home, who also has many observations and researches in the F&B field, believes that Ong Bau chain has the ability to win big in the competition with other coffee chains in the same segment.