|
Forecast
Period
|
2024-2028
|
|
Market
Size (2022)
|
USD 20.01 Billion
|
|
CAGR
(2023-2028)
|
10.5%
|
|
Fastest
Growing Segment
|
QSR
(Quick Service Restaurants)
|
|
Largest
Market
|
Northern
|
Market Overview
Vietnam Food Services Market has valued at USD 20.01
billion in 2022 and is anticipated to project robust growth in the forecast
period with a CAGR of 10.5% through 2028. Vietnam, renowned for its rich
culinary heritage and diverse street food culture, hosts a vibrant and dynamic
food services market that reflects the nation's deep-rooted gastronomic
traditions and its rapidly evolving modern dining scene.
Food holds immense cultural significance in
Vietnam. It is not merely sustenance but a reflection of the country's history,
geography, and regional diversity. Vietnamese cuisine is characterized by its
use of fresh ingredients, herbs, and a balance of flavors. Meals are often
communal, fostering a sense of togetherness and hospitality.
Vietnam's food services market is incredibly
diverse, catering to a wide spectrum of dining preferences and budgets. It
encompasses an array of dining options, including street food vendors,
traditional family-owned eateries (known as "quán"), upscale
restaurants, and international fast-food chains. This diversity makes
Vietnamese cuisine accessible to both locals and tourists.
Vietnam is renowned for its street food culture,
with bustling markets and street corners offering an array of delectable
dishes. Pho (noodle soup), banh mi (baguette sandwiches), bun cha (grilled pork
noodles), and com tam (broken rice) are just a few examples of beloved street
food items. Street vendors often operate with generations-old recipes,
preserving the authenticity of Vietnamese flavors.
Vietnam's regional diversity is reflected in its
cuisine, with each region boasting unique specialties. The north is known for
its delicate and subtly flavored dishes, while the central region offers spicy
and complex flavors. The south, including Ho Chi Minh City (Saigon), is famous
for its vibrant street food scene and fusion cuisine.
As Vietnam undergoes rapid urbanization and
economic growth, modern dining concepts, including international franchises and
upscale restaurants, are becoming increasingly popular, particularly among
urban populations. Additionally, there is a growing awareness of health and
sustainability in Vietnam's food services market. Consumers are seeking
healthier options, and restaurants are responding by incorporating organic
ingredients and reducing food waste. Furthermore, the rise of online food
delivery platforms has revolutionized the dining experience in Vietnam.
Services like GrabFood and Now.vn have made it convenient for consumers to
order their favorite dishes from local eateries and international chains. In
addition, Vietnamese chefs are experimenting with fusion cuisine, blending
traditional flavors with international influences. This trend is especially
prominent in urban centers where a younger generation of diners seeks
innovative dining experiences.
The future of Vietnam's food services market
appears promising. With a growing middle class, increasing disposable incomes,
and a continued focus on culinary innovation, the industry is poised for
further growth. As Vietnam's tourism industry continues to expand, it will
further boost the demand for a diverse range of dining options, from street
food to upscale dining experiences. In this ever-evolving landscape, Vietnam's
food services market remains a vibrant and integral part of the nation's
culture and economy, attracting both locals and international food enthusiasts.
Key Market Drivers
Rapid Urbanization and Rising Disposable Incomes
One of the primary drivers of the burgeoning food
services market in Vietnam is the country's rapid urbanization and the
associated increase in disposable incomes. As more people move from rural areas
to urban centers in search of employment and improved living standards, they
are contributing to the urbanization trend that is reshaping the nation's
landscape.
Urbanization has several profound impacts on the
food services sector. Firstly, it creates a growing demand for convenient
dining options, as urban dwellers have busier lifestyles and less time for
traditional home-cooked meals. This has led to a surge in the popularity of
quick-service restaurants (QSRs), street food vendors, and food delivery
services. Fast-casual dining concepts have also gained traction, providing a
middle ground between traditional dining and fast food.
Secondly, urbanization tends to raise incomes,
enabling people to allocate more of their budgets to eating out. With greater
disposable incomes, consumers are more willing to explore diverse dining
experiences, from upscale restaurants to international cuisine. This has fueled
the growth of fine dining establishments, specialty eateries, and fusion
restaurants, catering to a more discerning and adventurous palate.
Additionally, the influx of rural-to-urban
migration has spurred entrepreneurial opportunities in the food services
industry. Many individuals and families have opened small-scale eateries,
contributing to the vibrancy and diversity of Vietnam's culinary scene. These
local establishments often serve traditional dishes, providing a sense of
nostalgia and authenticity to city dwellers.
Young Demographic Profile and Changing Consumer
Preferences
Vietnam's demographic profile skews young, with a
significant portion of the population falling into the millennial and
Generation Z age groups. These young consumers have different dining habits and
preferences compared to their older counterparts, influencing the food services
market in several ways.
Firstly, younger generations tend to be more open
to trying new foods and flavors, leading to an increased interest in
international cuisines. Vietnamese consumers are embracing global culinary
trends, seeking out Japanese sushi, Korean barbecue, Western fast food, and
Mediterranean fare, among others. This has given rise to a wide range of
international restaurants and franchises operating in Vietnam.
Secondly, younger consumers are health-conscious
and environmentally aware. They are more likely to prioritize fresh, organic,
and sustainably sourced ingredients. This has prompted restaurants to adapt by
offering healthier menu options, emphasizing locally sourced produce, and
reducing their environmental footprint through sustainable practices.
Thirdly, the digital era has greatly impacted
consumer behavior. Younger generations, in particular, are tech-savvy and rely
heavily on smartphones for various aspects of their lives, including dining.
This has led to the proliferation of food delivery apps and online ordering
platforms, providing a convenient way for consumers to access their favorite
meals. Restaurants that fail to adapt to this digital landscape may find it
challenging to compete.
Tourism and International Exposure
Vietnam's burgeoning tourism industry is another
major driver of its food services market. The country's scenic landscapes, rich
cultural heritage, and historical attractions have drawn a growing number of
international tourists, exposing them to Vietnamese cuisine and creating
opportunities for food services businesses.
Tourists often seek authentic culinary experiences,
and Vietnamese street food, such as pho, banh mi, and spring rolls, has gained
global recognition for its delicious flavors and affordability. Street food
vendors and local eateries have benefited from this influx of visitors,
contributing to the overall growth of the food services sector.
Moreover, tourism has led to a diversification of
dining options to cater to the international palate. In major tourist
destinations like Hanoi, Ho Chi Minh City, and Hoi An, one can find a wide
range of restaurants offering international cuisines, including French,
Italian, Thai, and Indian. This not only enhances the dining experience for
tourists but also broadens the culinary horizons of local residents.
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Key Market Challenges
Intense Competition and Saturation
One of the foremost challenges facing the Vietnam
food services market is the intense competition and market saturation,
particularly in urban areas like Hanoi and Ho Chi Minh City. The sector has
witnessed significant growth in recent years, leading to an abundance of dining
options ranging from street vendors to upscale restaurants. While this variety
benefits consumers, it creates a fiercely competitive environment for
businesses.
The saturation is particularly pronounced in
certain segments, such as fast food and casual dining, where international
chains like McDonald's, KFC, and Pizza Hut compete with numerous local players.
This competition exerts downward pressure on prices, making it difficult for
businesses to maintain profitability. As new entrants continue to join the
market, established restaurants must continually innovate to differentiate
themselves and retain customer loyalty.
Evolving Consumer Preferences and Health Concerns
Vietnamese consumers' preferences are evolving,
with a growing demand for healthier, more diverse, and environmentally
sustainable dining options. While Vietnamese cuisine is known for its fresh
ingredients and balance of flavors, there is a shift towards healthier eating
habits, including reduced oil and sugar intake and increased consumption of
fruits and vegetables.
In response to these changing preferences, many
food service establishments are modifying their menus to include lighter and
more nutritious options. However, this transition can be challenging, as it
requires sourcing high-quality ingredients, retraining kitchen staff, and
potentially redesigning existing menus. Balancing tradition and innovation is a
delicate process, and businesses that fail to adapt may face declining customer
numbers.
Furthermore, health concerns, including food safety
and hygiene, are critical for consumers. Ensuring consistent food safety
standards and transparency in the supply chain is a constant challenge. Any
lapses in food safety can lead to reputational damage and financial setbacks
for food service providers.
Labor Shortages and Rising Labor Costs
The Vietnam food services market grapples with
labor shortages and rising labor costs, particularly in larger cities. As the
economy has grown, there has been a shift away from traditional agriculture,
leading to urbanization and increased demand for labor in various sectors,
including hospitality and food services.
Restaurants, cafes, and food establishments often
struggle to attract and retain skilled and reliable staff, such as chefs,
servers, and kitchen workers. The competition for labor has driven up wages and
benefits, affecting the profitability of businesses. In addition to higher
wages, businesses must also navigate complex labor regulations, which can be a
burden, especially for smaller establishments.
The labor shortage issue has been exacerbated by
the COVID-19 pandemic, which led to temporary closures, reduced working hours,
and layoffs, causing many experienced workers to seek employment in other
industries or regions.
To address these labor-related challenges, some
businesses have turned to automation and technology to streamline operations,
reduce reliance on human labor, and improve efficiency. However, this
transition requires substantial investment and may not be feasible for all
types of food service establishments.
Key Market Trends
Fusion Cuisine and Global Influences
One of the most striking trends in the Vietnamese
food services market is the emergence of fusion cuisine and the incorporation
of global culinary influences into traditional Vietnamese dishes. This trend
reflects Vietnam's growing openness to international flavors and its desire to
cater to both local and expatriate populations with diverse tastes.
Vietnamese chefs and restaurateurs are creatively
blending Vietnamese ingredients and techniques with global flavors, resulting
in innovative and unique dishes. For example, you can find Vietnamese-inspired
pizza with toppings like lemongrass chicken and fish sauce-infused drizzles or
hamburgers garnished with fresh herbs and chili. These creative fusions not
only offer new taste experiences but also showcase the adaptability of
Vietnamese cuisine.
Furthermore, international fast-food chains and
restaurant brands have made significant inroads into the Vietnamese market.
From American burger joints to Japanese sushi bars and Italian pizzerias,
global franchises are tailoring their menus to incorporate local ingredients
and flavors, making their offerings more appealing to Vietnamese consumers.
This trend reflects the influence of globalization and the desire for diverse
dining options.
Health and Wellness Focus
Health and wellness have become increasingly
important considerations in the Vietnamese food services market. Consumers are
becoming more health-conscious and are seeking options that align with their
dietary preferences and lifestyle choices.
One notable sub-trend is the rise of vegetarian and
vegan dining. Vegetarian and vegan restaurants, as well as vegetarian-friendly
menu options, are becoming more widespread. These establishments cater to both
those following plant-based diets for ethical or health reasons and those
seeking lighter and healthier meal choices. Traditional Vietnamese vegetarian
dishes like "com chay" (vegetarian rice) and "pho chay"
(vegetarian pho) have gained popularity among locals and tourists alike.
Additionally, restaurants and cafes are
increasingly incorporating organic and locally sourced ingredients into their
menus. This shift reflects the desire for fresh, pesticide-free produce and
supports sustainable agricultural practices. Organic food markets and
farm-to-table dining experiences have also become more prevalent, connecting
consumers with the source of their food.
Furthermore, health-oriented menu labeling,
allergen information, and calorie counts are becoming more common, allowing
diners to make informed choices. These initiatives promote transparency and
empower consumers to make healthier decisions when dining out.
Technology Integration and Delivery Services
The Vietnamese food services market has witnessed a
rapid integration of technology into its operations. The advent of smartphones
and the growth of the digital economy have transformed how consumers interact
with food services establishments.
Online food delivery services have experienced
explosive growth, with numerous platforms competing for market share. Companies
like GrabFood, GoFood, and Now.vn have made ordering food as easy as tapping a
smartphone screen. This convenience-driven trend has not only benefited
established restaurants but has also given rise to a new breed of "cloud
kitchens" that operate solely for delivery purposes.
In addition to delivery, technology has impacted
the dining experience itself. Many restaurants now offer digital menus that
customers can access via QR codes on their smartphones. This touchless dining
experience minimizes physical contact with traditional menus, contributing to
hygiene and safety in the post-pandemic era.
Furthermore, loyalty programs and mobile apps are
common tools used by restaurants to engage with customers, offer discounts, and
collect valuable data for marketing and menu development.
Segmental Insights
Type Insights
Quick Service Restaurants (QSRs) have established a
notable presence and wield significant influence in the Vietnam food services
market, reflecting the country's evolving dining habits, urbanization, and a
burgeoning middle class. These QSR establishments have become an integral part
of Vietnam's culinary landscape, offering quick, convenient, and affordable
dining options that cater to a wide range of consumers.
Vietnam is undergoing rapid urbanization, with a
growing number of people moving to cities in search of better employment
opportunities. As urban centers expand, lifestyles become busier, and people
increasingly turn to QSRs for meals that are quick to order and consume. QSRs
align perfectly with the pace of modern urban living.
QSRs in Vietnam provide a diverse menu that caters
to local and international tastes. Traditional Vietnamese flavors, such as pho,
banh mi, and spring rolls, coexist with international staples like burgers,
fried chicken, pizza, and sandwiches. This variety ensures that QSRs appeal to
a broad cross-section of the population.
One of the defining features of QSRs is
affordability. The relatively low prices make QSRs accessible to a wide range
of consumers, including students, young professionals, and families. This
affordability is particularly appealing in a country where price-consciousness
is prevalent.
QSR chains have aggressively expanded their
presence throughout Vietnam. Their outlets can be found in bustling city
centers, shopping malls, transport hubs, and even in suburban areas, ensuring
easy access for customers. This strategic expansion has played a crucial role
in their market dominance.
Quick service is at the core of QSRs' success. In a
fast-paced world, customers appreciate the convenience and speed of ordering,
paying, and receiving their meals. Drive-thru options and efficient in-store
service further enhance this convenience.
QSRs in Vietnam have embraced technology to enhance
customer experience. Mobile apps for ordering and delivery have gained
popularity, allowing customers to customize orders and enjoy special
promotions. This tech-savvy approach resonates with the country's digitally
connected population.
Many international QSR chains operating in Vietnam
have adapted their menus to incorporate local flavors and ingredients. This
fusion of international and local culinary elements caters to Vietnamese tastes
while maintaining the familiarity of global brands.
The growth of QSR chains in Vietnam has contributed
to job creation, providing employment opportunities for thousands of locals in
various roles, from kitchen staff to management positions.
Vietnam has a predominantly youthful population,
and QSRs have successfully positioned themselves as attractive dining options
for the younger generation. The appeal of international branding,
affordability, and convenience align well with the preferences of Vietnam's
youth.
Ownership Insights
Chained outlets have carved out a substantial and
noteworthy presence in the Vietnam Food Services Market, marking a significant
shift in the country's dining landscape. This evolution is driven by a combination
of factors, including changing consumer preferences, urbanization, increased
disposable income, and the allure of standardized quality and convenience
offered by these establishments.
Chained outlets, also known as chain restaurants or
restaurant chains, have experienced remarkable growth in Vietnam. These are
restaurants or eateries that have multiple branches under a single brand,
providing consistency in both menu offerings and dining experience. Vietnam has
seen a proliferation of such chains, covering a spectrum of cuisines from fast
food and casual dining to international and local flavors.
The rapid urbanization of Vietnam, particularly in
cities like Hanoi and Ho Chi Minh City, has led to busier and more fast-paced
lives. As urban dwellers seek convenience and speed, chained outlets have
stepped in to cater to these modern lifestyles. These establishments offer
quick service, consistent quality, and familiar menus, making them appealing
choices for individuals and families alike.
Chained outlets are known for their strict
adherence to standardized recipes, preparation methods, and service procedures.
This commitment to consistency ensures that customers can expect the same level
of quality and taste at any branch of the chain. In a market where food safety
and hygiene are of paramount concern, this standardized approach has resonated
with consumers.
The Vietnam
Food Services Market features a mix of international and domestic chained
outlets. Renowned global chains like McDonald's, KFC, Starbucks, and Pizza Hut
have successfully expanded their presence in the country. Simultaneously,
Vietnamese chains, such as Pho 24, Highlands Coffee, and Lotteria, have also
emerged as strong players, offering unique flavors and concepts tailored to
local preferences.
Chained outlets in Vietnam cater to diverse tastes
and preferences. While fast-food chains like McDonald's and Burger King are
popular among the younger demographic, casual dining chains like The Pizza
Company and BBQ Chicken offer sit-down experiences suitable for families and
groups. Local chains often blend traditional Vietnamese flavors with modern
dining concepts, creating a fusion of tastes.
Chained outlets in Vietnam have adopted technology
to enhance customer experiences. Many offer online ordering and delivery
services, allowing customers to enjoy their favorite dishes from the comfort of
their homes. Mobile apps and loyalty programs have also become common features,
enticing customers to return for more.
Vietnam's robust economic growth and a burgeoning
middle class have resulted in increased disposable incomes. As people's
spending power has grown, they are more willing to dine out and explore
different culinary options, including those offered by chained outlets.
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Regional Insights
The Northern Region of Vietnam, comprising
provinces and cities such as Hanoi, Hai Phong, and others, commands a
substantial share in the country's dynamic food services market. This region's
influence is driven by a combination of cultural heritage, economic activity,
and a thriving culinary scene.
Hanoi, the capital city of Vietnam, is often
referred to as the culinary capital of the country. It is home to an extensive
array of traditional Vietnamese dishes and street food, offering a rich
tapestry of flavors and culinary traditions. The city's renowned street markets
like the Old Quarter and Dong Xuan Market are bustling hubs of gastronomic
delights, drawing both locals and tourists seeking authentic Vietnamese
cuisine.
The Northern Region's food culture is deeply rooted
in tradition and reflects the history and heritage of Vietnam. Pho, bun cha,
bun thang, and cha ca are just a few examples of iconic Northern Vietnamese
dishes that have gained national and international acclaim. The region's
diverse cuisine attracts food enthusiasts from across the country.
Northern Vietnam has witnessed significant economic
growth and urbanization, particularly in cities like Hanoi and Hai Phong. This
has led to an increase in the number of restaurants, cafes, and food outlets to
cater to the growing population and a rising middle class with disposable
income for dining out.
The Vietnamese government has actively promoted
tourism and the food services industry as part of its economic development
strategy. Initiatives like "Vietnam Tourism Year" have focused on
showcasing the country's culinary heritage, boosting the visibility and
popularity of Northern Vietnamese cuisine.
The Northern Region is known for its vibrant street
food culture, where locals and visitors can savor a wide range of dishes on the
sidewalks. From bun cha (grilled pork with noodles) to banh mi (Vietnamese
sandwiches), these street food vendors contribute significantly to the region's
food services market.
The Northern Region boasts numerous tourist
attractions, including historical sites, cultural landmarks, and natural
wonders. Tourists exploring these attractions often seek authentic local food
experiences, boosting the demand for food services in the area.
The Northern Region has also been influenced by
international cuisines, especially in urban areas. International restaurants,
cafes, and fast-food chains have found success in cities like Hanoi, offering a
diverse range of dining options.
Northern Vietnam hosts various festivals and
events, many of which are centered around food. The Tet (Lunar New Year)
celebrations, for example, feature an array of traditional dishes and street
food stalls, creating a vibrant food festival atmosphere.
Northern Vietnam has embraced culinary tourism,
with cooking classes, food tours, and farm-to-table experiences becoming
increasingly popular. Tourists are eager to learn about the region's culinary
traditions and ingredients.
The food services market in the Northern Region is
highly competitive, with both traditional and modern dining establishments
vying for customers' attention. This competition drives innovation, quality,
and a commitment to preserving Northern Vietnam's culinary heritage.
Recent Developments
- In 2023, Starbucks, the US coffee chain, is set to
celebrate a decade of operations in Vietnam by expanding its presence to 100
stores across the country by the end of the first quarter. Since opening its
inaugural store in Ho Chi Minh City in February 2013, the Seattle-based coffee
giant currently operates 87 outlets across seven Vietnamese provinces.
- In 2023, Burger King and Popeyes will jointly open
a combined fast food outlet in Hanoi. The new establishment, located at 04 Nha
Chung Hoan Kiem, Hanoi, has been serving customers in the Hoan Kiem district
since January 24.
- In 2022, KFC introduced Charcoal Grilled Chicken
Rice in Vietnam. This flavorful dish features chicken fillets grilled on
charcoal and glazed with Japanese Teriyaki sauce.
Key Market Players
- CP All PCL
- Golden Gate JSC
- Imex Pan Pacific Group
- Jollibee Foods Corporation
- Lotte GRS Co. Ltd
- Mesa Group
- Restaurant Brands International Inc.
- Starbucks Corporation
- The Al Fresco's Group Vietnam
- Yum! Brands Inc.
|
By Type
|
By Ownership
|
By Brands
|
By Region
|
- Dining Service (Hotels, Restaurants)
- QSR (Quick Service Restaurants)
- Cafes
- Others
|
- Standalone Outlets
- Chained Outlets
|
|
|
Report Scope:
In this report, the VIETNAM Food Services market has
been segmented into the following categories, in addition to the industry
trends which have also been detailed below:
- Vietnam Food Services Market, By Type:
o Dining Service (Hotels, Restaurants)
o QSR (Quick Service Restaurants)
o Cafes
o Others
- Vietnam Food Services Market, By Ownership:
o Standalone Outlets
o Chained Outlets
- Vietnam Food Services Market, By Brands:
o Domestic
o International
- Vietnam Food Services Market, By Region:
o Northern
o Southern
o Central
Competitive Landscape
Company Profiles: Detailed analysis of the major companies present in the Vietnam Food
Services market.
Available Customizations:
Vietnam Food Services Market report with the
given market data, Tech Sci Research offers customizations according to a
company's specific needs. The following customization options are available for
the report:
Company Information
- Detailed analysis and profiling of additional
market players (up to five).
Vietnam Food Services Market is an upcoming report
to be released soon. If you wish an early delivery of this report or want to
confirm the date of release, please contact us at [email protected]