Globalisation Takes Another Step as McDonald’s Opens in Vietnam

It has arrived there somewhat later than its major competitors. However, McDonald's has finally open its first outlet in Vietnam. It is a significant moment for an icon of globalisation, not the least given the historical connection between the USA and Vietnam.

McDonald's announced back in July 2013 that the first franchise in Vietnam had been awarded to Henry Nguyen, who happens to be the son-in-law of Communist-ruled Vietnam's leader!

Now the first outlet has opened for business and the expansion plan has an objective of 100 outlets there pretty quickly.

McDonald's is pretty late to the party in terms of entering Vietnam which has already attracted substantial investment from other global fast-food brands including KFC (Yum! Brands) who have traded there for over 16 years. However, there is growing demand in Vietnam which, like China, has a surging middle class, and a relatively young population (most of its 90 million citizens were born after the Vietnam War ended, in 1975).

However, as this New York Times article points out, being late to the market, McDonald's can expect to face significant competition from its multinational rivals and strong domestic businesses:

"...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."

This video from Bloomberg provides some additional analysis of McDonald's move into Vietnam.