Vietnam Gets First Taste Of The Big Mac

NeverSayGoodBye

9 Feb 14, 15:10

HANOI, Vietnam — When Nguyen Hoang Anh and Nguyen Thi My Hao started dating, the 23-year-olds agreed to disagree about food: Mr. Anh adores Western-style fast food, but Ms. Hao mainly eats pho, a popular noodle soup, and other northern Vietnamese foods she has loved since childhood.

“He dragged me here,” Ms. Hao, a secretary at a Hanoi university, said recently at a new Burger King restaurant here.

But though she does not eat fast food almost every day like her boyfriend, Ms. Hao said she was not entirely opposed to it once in a while.

“Sometimes I want to try something different,” she said, before taking a bite of her Whopper hamburger.

Attitudes like hers — and appetites like her boyfriend’s — have made Vietnam attractive for American fast-food brands, which view the country as one of Asia’s last consumer markets with significant untapped potential, according to industry analysts.

The latest entrant is McDonald’s, the fast-food giant, which has restaurants in more than 100 countries and will open its first Vietnam location on Saturday in downtown Ho Chi Minh City.

Vietnam has a surging middle class, and most of its 90 million citizens were born after the Vietnam War ended, in 1975. Many young Vietnamese are insatiably curious about foreign cuisine and culture, like kebabs and K-pop, and the McDonald’s opening has been widely discussed on Vietnamese websites in recent weeks.

KFC opened in Vietnam in 1997, two years after the country normalized relations with the United States. But not until 2010 did American brands begin to enter Vietnam’s market in earnest. They still trail Asian brands by a large margin. American-style Asian fast-food chains, like Lotteria from South Korea and Jollibee from the Philippines, have slowly introduced restaurants in a few major cities. Two Vietnamese coffee chains — Highlands Coffee and Trung Nguyen — have also made a splash in a market dominated by mom-and-pop cafes.

It was inevitable, consultants said, that more American brands would enter the country once the economics looked more appealing. Vietnam’s per capita income rose to $1,550 in 2012 from $1,000 in 2008, according to World Bank estimates, and inflation has stabilized.

“It’s got a big population, the government is making it easier to enter,” said Ralf Matthaes, managing director for Vietnam and the Mekong region at TNS Global, a British market-research consulting firm, “and Vietnamese are now having that basic income level where there is not just sustainability but genuine opportunity for growth and profits.”

McDonald’s waited a long time to open in Vietnam, given its global brand recognition and likely appeal to young Vietnamese consumers. When it did, it tagged Henry Nguyen, the son-in-law of Prime Minister Nguyen Tan Dung, as its local franchisee.

Bill Hayton, a former foreign correspondent in Vietnam and the author of “Vietnam: Rising Dragon,” a 2010 book that explored links between money and power in the one-party state, said: “Laws and regulations are often rather vaguely written, giving officials plenty of opportunity to delay or assist an investor’s plans, but Mr. Nguyen has been able to negotiate these difficulties with ease. Having the second-most-powerful man in the country as father-in-law is like having a golden ticket and get-out-jail-free card all rolled into one.”

A representative for McDonald’s declined requests for a meeting or telephone interview with Mr. Nguyen, a Vietnamese-American business tycoon who moved to the United States as a child and returned with degrees from Harvard and Northwestern University to run the Vietnam office of IDG Ventures, a network of venture capital funds based in San Francisco.