VietNamNet Bridge – The initial success gained by foreign franchise chains in Vietnam has prompted more and more foreign enterprises to come to the country.
AT Korea Agro-Fisheries & Food Trade Corp was one of many South Korean businesses participating in the 2015 international trade fair on franchise and retailing held in HCM City a few days ago.
Won-mok Yang, the manager of the company’s stall at the fair, said his company was looking for Vietnamese partners who could bring seven South Korean brands to Vietnam under franchise contracts.
The initial success gained by foreign franchise chains in Vietnam has prompted more and more foreign chains to come to the country
“With the young population and rapid economic development, Vietnam now attracts South Korean franchisers,” he said.
Owning 150 coffee shops in South Korea, Selecto considers Vietnam an important market for it to look for franchise partners. Why Vietnam? Selecto’s managing director Hwang KyuYoun said “Korean culture has become familiar to Vietnamese, while the number of Korean people living and doing business in Vietnam has been increasing rapidly”.
Vietnam is attractive not only to Asians, but western businesses as well. Délifrance, the French style bakery company, also came to Vietnam to look for partners. According to FabriceHerlax, the company now eyes South East Asian countries, especially Vietnam, after expanding its chain in Europe and other Asian countries.
Délifrance was one of 20 businesses from Europe and America that participated the trade fair and showed clear plans of stepping up a franchise in Vietnam.
According to Nguyen Phi Van, chair of Retail & Franchise Asia, which represents many foreign franchise brands in Vietnam, about 40 foreign brands were looking for Vietnamese partners, 90 percent of which are from Europe and the US. Most of them are in the fields of food, education and gymnastics.
Phi noted that as the European market has not recovered from the recent crisis, European and US businesses have tended to shift their business focus to Asia. They are attracted by Vietnam’s 90 million population and the 600 million-consumer AEC membership.
Most licenses granted are master franchisee
According to the Ministry of Industry and Trade, the ministry has granted licenses to 140 foreign brands since 2007.
Analysts said that franchisees set up business networks in the domestic market in accordance with the original models and then expand the networks under a sub-franchise mode.
However, they noted that very few sub-franchise networks have been set up in the last few years. In most cases, franchisees open more shops themselves, rather than re-franchise to sub-networks.
Even Jollibee, which came to Vietnam very early, does not have any sub-franchised shops.
Stall (n): gian hàng
Franchise (n): Nhượng quyền
Master Franchise (n): nhượng quyền độc quyền
Sub-franchise (n): nhượng quyền thứ cấp