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In recent years, toward the globalization and internationalization, together with the rapid
economic development in Vietnam, social conditions also have some changes. One of these
changing social elements is eating habit. This paper argues that with the entrance of and the
dramatic development of the Western-style fast food into Vietnam, the Vietnamese now have
more choices for eating out. The paper examines a case study of KFC in Hanoi through onsite observations and interviewing of KFC staff and customers. According to the KFC case
study, some determinants of development of western-style fast food in Vietnam are defined
and analyzed, including the enlargement of fast food supply chain, changes of eating habit
and lower impact of fast food price on Vietnamese customers. Besides, the research also
finds out some hindrances of fast food development in Vietnam and concludes by proposing
some suggestions for fast food enterprises to develop further in the Vietnamese market.
Key words: fast food, Western – style fast food, KFC, Hanoi, Vietnam
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I.
Introduction ....................................................................................................................... 3
II. Methodology ..................................................................................................................... 4
III.
Determinants of the development of KFC in Hanoi and fast food in Vietnam............. 7
1. The increase in level of KFC consumption together with enlargement of KFC supply
chain...................................................................................................................................... 7
2.
The changes in the coming-to-restaurant habits............................................................ 8
3.
Impact of the price on the customers........................................................................... 10
IV.
Hindrance of fast food development in Vietnam ........................................................ 11
V. Conclusion: ..................................................................................................................... 13!
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Eating is one of essential elements to sustain human existence. Eating habits and meal
composition, etc. represent cuisine culture of each country and each region. For instance,
Westerners use knives and forks to eat bread, butter, cheese, and bacon while Eastern people
use chopsticks and spoons to eat rice, soup with stir-fries and fried dishes. Presently, with the
international integration, eating and drinking culture of each country and each region is
widely spread on the world. The appearance of Eastern dishes in the West has become quite
familiar and Eastern people also do not much feel strange with Western food.
In some recent years, Western-style fast-food has entered into Vietnam and step by step
become more familiar with the Vietnamese. It cannot be denied that people like fast-food
because it can taste pretty good (Schlosser, 2001). In the increasingly development period
when people seem to have less time to prepare for their meal, they tend to go out and find
convenient restaurant where they can have delicious meal in a comfortable space and chat
with their families or their friends. Western fast food restaurants gradually seem to be good
choices for many people.
Fast food (also known as Quick Service Restaurant) is the term given to food that can be
prepared and served very quickly1.A tentative definition for Western-style fast food at this
stage in the research is a kind of food that can be prepared and served very quickly in
Western style such as sandwich, hamburger, and pizza. The purpose of this study is to
discover potentials of the development of West-style fast food in Vietnam through
examining the case of KFCC Corporation (KFC) in Hanoi while critically examine the
possible consequences of fast food development. Three main research questions we pose
here include:
•
What are factors determining the fast development of KFC in Hanoi in particular and
fast food enterprises in Vietnam in general?
•
What are the possible hindrances of fast food development in Vietnam?
•
What are the development strategy implications for the KFC in particular and for
other fast food enterprises in Vietnam in general?
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1
http://en.wikipedia.org/wiki/Fast_food
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The study will confine itself to finding about Western fast-food style. The interview and
observations was conducted in three KFC restaurants in Hanoi from 10th October to 28th
November 2010. Based on the interview and observation results, some generalization about
the Western-style fast food will be drawn on. However, the findings of the research based on
small sample are indicative and due care may have to be taken to make any generalization.
Studies of Western-style fast-food in Vietnam actually tend to be approached in view of
health officers and economists, but few studies of Western-style fast food from the
perspective of social sciences in Vietnam. Some previous studies from foreign researchers
about fast-food are “China’s fast-food industry research report” by China Research and
Intelligence in 2008, “Fast-food Nation” by Eric Schlosser in2001” and “The effect of fast
food restaurants on obesity and weight gain” by Janet Currie et al in 2009”. In Vietnam, we
found some studies related to fast food, of which a typical one is a research in Vietnamese
about fast-food in 2006 from website http://www.scribd.com/doc/8147199/Nghien-CuuMarketing-Ve-Thuc-an-Nhanh-Dien-Thoai-Di-Dong-Va-Games-Online
(last
view:
December 11th 2010), however, the document did not present the name of authors.
(()
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The strategy of inquiry that we used in this research was the case study approach, in which
the researcher explores in depth a program, an event, an activity, a process, or one or more
individuals. The cases are bounded by time and activity, and the researchers collect detailed
information using a variety of data collection procedures over a sustained period of time
(Stake, 1995). In this study, we explored in depth the case study of 3 KFC restaurants in
Hanoi. The observations of the KFC restaurants and interviews of KFC staffs and customers
were implemented in 7 weeks, from 10th October to 28th November 2010.
The reason why KFC was chosen as the case study is that KFC is typical and popular
western-style fast food brand in Hanoi. Currently, there are about four western-style fast
food brands in Hanoi including BBQ, Lotteria, KFC and 1- Minute. Among them, KFC can
be the representative of western-style fast food in term of service and decorating style.
Moreover, KFC is presently possessing 17 restaurants in 10 districts in Hanoi. That means
KFC is one of the most popular western-style fast food brands with Hanoi people. Therefore,
the data collected through the KFC customers can be typically for western-style fast food
customers in Hanoi as a whole.
*!
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Three KFC restaurants is selected purposefully according to their locations: from the areas in
North center of Hanoi ( Nguyen Van Cu street) and South center (Cau Giay street) to the
center of Hanoi (Hang Trong street) to get different useful information. To triangulate
different data sources from different sites also is the strategy we used to ensure the validity
of the collected data.
As the qualitative research, the data was collected through the observation as participant,
face-to-face and group interviews, and documents. To participate, we directly came and
acted as real customers of KFC. The observation was implemented 9 times totally with 3
times for each restaurant. We also arrange the observation in both weekends and weekdays
at different times in days to reduce the subjective judgments. The interviews were conducted
with unstructured and open-ended questions with both the KFC customers and the KFC
staffs. We interviewed 18 people including five KFC staffs, seven KFC customers in face-toface interview and 6 KFC customers in group interview. The interviewed KFC customers
were also selected purposefully according to their genders, age group and social class to get
more information from many different viewpoints. We also searched and analyzed
information through the public documents in the internet such as the official website of KFC
in Vietnam and related articles.
After collecting the data, the data were organized categorically and reviewed repeatedly.
Then we obtained a general sense of the information to reflect on its overall meaning.
We also went to other western-style fast food restaurants of BBQ and Lotteria…to have our
own evaluations and opinions about these products and brought certain biases to this study.
Clarifying the bias we brought to the study is also the strategy to validate findings in this
research. The specific characteristics of KFC restaurants in general, as well as three selected
KFC restaurant in particular were presented in Table 1.
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Table 1: The main specific characteristics of researched three KFC restaurants
KFC Nguyen Van Cu
KFC Hoan Kiem
KFC CauGiay
In general, KFC restaurants have quite nice layout, mainly base on red background and be
decorated by KFC pictures (logo KFC and pictures of an old man). Moreover, in the direct
forward streets, KFC restaurants are covered by glasses so that customers may have a look at
streets and feel as in a larger space.
-
Address:
405
Nguyen -
Address: 3C Le Thai To, -
Address: 372 – 374
Van Cu, Long Bien,
Hoan Kiem, Hanoi – the
CauGiay,
Hanoi – right at the
centre of Hanoi, right
between CauGiay and
corner of Nguyen Son
opposite
Xuan Thuy Street.
and Nguyen Van Cu
Lake.
Street.
-
-
Have 2 floors and be the
first KFC restaurant in
Long Bien district.
-
-
Hoan
-
–
Have 3 floors and be
Have 3 floors with quite
built on a quite large
small area.
area (about 80m!/floor).
Near Morning Star Hotel, -
Opposite Topcare Plaza
Hanoimoi
office,
and near Hanoi National
Quite near some offices
Intermex
supermarket
University of Education,
such as Techcombank,
and
Hanoi
Vietnam
Vietnam
Airline
Streets such as Luong
management office; and
Van Can, Hang Dao,
some schools such as
Hang Gai, Cau Go where
Nguyen Gia Thieu, Ai
is usually crowed.
near
Mo and Ngoc Lam.
,!
!
Kiem
Hanoi
Old
University.
National
4&%&*5.$6$%'!#7!%0&!+&8&1#95&$%!of KFC in Hanoi and fast food
in Vietnam
III.
The interview and observations results showed that there are 3 main factors that determine
the development of KFC in Hanoi.
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KFC Corporation (KFC), founded in 1930 and also known as Kentucky Fried Chicken, is a
chain of fast food restaurants based in Louisville, Kentucky, the United States. KFC
primarily sells chicken pieces, wraps, salads and sandwiches. Now, it is ranked second
among fast food trademarks on the world, only after McDonald’s, with over 10,000 KFC
restaurants in 92 countries2.Revenue of KFC Corporation in some recent years is over
USD5, 000 million, except 2004 and 2005 when bird flu outbreak.
Table 2: Revenue of KFC Corporation (Unit: million USD)
Year
2001
2002
2003
2004
2005
2006
2007
Revenue
5,251
5,346
5,576
5,118
5,112
5,350
5,682
(Source: http://vi.wikipedia.org/wiki/KFC)
KFC entered the Vietnamese market for the first time in October 12th 1997, in the
commercial center of Saigon Super Bowl. After that, KFC enlarged its stores widely in other
regions.
•
In June 2006: first restaurant opened in Hanoi
•
In August 2006: first restaurant opened in HaiPhong, Can Tho
•
In July 2007: first restaurant opened in Dong Nai - Bien Hoa
•
In January 2008: first restaurant opened in Vung Tau
•
In May 2008: first restaurant opened in Hue
•
In December 2008: first restaurant opened in Buon Ma Thuot
•
In November 2009: first restaurant opened in Da Nang
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http://vi.wikipedia.org/wiki/KFC!
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•
In April 2010: first restaurant opened in Binh Duong3
Presently, there are 80 KFC restaurants in Vietnam (48 in Ho Chi Minh City, 17 in Hanoi, 3
in Dong Nai, 1 in Can Tho, 2 in Vung Tau, 1 in Ba Ria, 2 in Da Nang, 2 in Hue, 1 in Buon
Me Thuot, 1 in Binh Duong and 2 in HaiPhong)4. In other word, KFC has grown and has
great potential to further develop its business in Vietnam.
After interviewing 13 customers in three KFC restaurants, 10 customers said that they like
KFC’s taste, and the others do not like. However, among three customers do not like KFC’s
taste, one of them said that she and her family still usually go to KFC restaurants (3-4 times
per month) because her small daughter really likes KFC with soft and easy-to-eat chicken.
Ten customers like KFC mostly for some reasons that KFC spaces are quite clean and airy
where customers can sit, have meal, listen to music or chat with friends/family freely.
When we interview a guardian in KFC Nguyen Van Cu who has been the restaurant’s
guardian from its opening, he enthusiastically told us about this restaurant from the first
days. He said that in the first week, customers came to this restaurants are very crowded;
therefore he had to work hard but felt very happy. However, in the second week, after
promotions for the opening, the number of customers coming to the restaurant fell
significantly and customers mainly were young people. This situation did not exist for a long
period; the number of customers increased gradually in some following weeks. At present,
the customer’s quantity remains stably at high level, especially at the weekend (maybe reach
nearly 1,000 servings per day). Moreover, the customers are not only the young, but also
children and middle-age people.
Last but not least, one more common opinion from our interviewees is that they think fastfood has great opportunity to enlarge and develop in Vietnam in the coming years.
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Through the interviews and observations, we can identify some changes in eating habits of
people in Hanoi that related to the development of KFC restaurants in particular and
western-style fast food in general.
As we observed, the main types of customers coming to KFC are couples, families, group of
friends, or colleagues. The quantity of consumers increases at weekends and on holidays.
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)
http://www.kfcvietnam.com.vn/#/KFCVietnam/1!
http://vi.wikipedia.org/wiki/KFC
4
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That shows a tendency that many people now on vacations usually hang out and get outsidehome meal. They do not want to spend relaxing time of vacations on cooking and preparing
meal at home but for them, it would be better to look for a new and different atmosphere.
Nowadays, with the appearance of fast food restaurants like KFC, people have another good
choice when considering where to eating out with intimates and friends. KFC creates a
common cozy and comfortable atmosphere for its restaurants by the open architecture using
glass walls so that customers can enjoy the food and the scene outside restaurant at the same
time. The major color which was used here is bright red; it makes the customers feel the
closeness and enthusiasm. Moreover, KFC restaurants also bring to people a feeling of
conveniences. In the group interview with 6 KFC customers, they expressed the satisfaction
when talking about western-style fast food restaurant like KFC, BBQ or Lotteria… Before,
when there’s no such kind of fast food, they and their friends often chose the traditional food
like Pound hot pot… which was sold on the street pavement or small and simple restaurant
where they have no space to talk comfortably. Therefore, they would finish the meal early,
leave the restaurant and find a coffee shop which has a nicer space to talk together. Now,
instead of this inconvenient choice, they and their friends can come to KFC, order the food,
find a big table and then enjoy the time. Eating, drinking, chatting, taking nice picture or
even playing games with friends in a beautiful and pleasant space, you can sit there for hours
without any complaint from others, of course if your activities do not bother around people.
Not only groups of friends or families like to come to KFC restaurants, the other loyal
customers are the couples. It seems that KFC restaurant is one of the best places for dating.
Ms. L, employee of KFC 372-374 CauGiay Street, said that in the weekends and vacations,
restaurant has a lot of customers and half of them are couples.
In KFC restaurants, mornings are off-peak times when the number of customers is very
small. However, more people come to KFC for lunch and they are even crowded at the
dinner time. Despite the customers will choose the food, order then wait to bring the meal to
table by themselves, KFC employees still have to keep working continuously in these times
to serve the customers as quick as possible. Their serving manner is very professional, as
many KFC customers who were interviewed evaluate; thus people don’t feel uncomfortable
when they have to self-serve and is getting used to this serving method. According to Ms.
Trang, student from University of Economics and Business, Vietnam National University,
Hanoi, also a loyal customer of KFC, she don’t mind to take the KFC meal by herself
because when the restaurant is in on-peak times, if waiting for the employees bring the food
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to your own table, it will take a lot of time, thus self-serving will be much faster. When
coming to KFC, self-serving will become a habit. Four in thirteen interviewed customers
said, for the first time they come to KFC, they feel a little bit strange with the food and
serving method; however, several time later they got used to these differences and feel
completely comfortable to buy meal at KFC. It can be seen that western style fast food has
create an industrial feature in the coming-to restaurant habits of the Vietnamese.
B) (596-%!#7!%0&!9*.-&!#$!%0&!-,'%#5&*'!
In KFC restaurants, the combos cost about 40,000 to 50,000VNDon average. During
interview process, we saw that price was also one aspect making people concerned about
when we mentioned about fast food or KFC. However, their opinions were various and can
be classified into 2 main flows of ideas:
When we observed some KFC restaurants, we found that although the customers may be
families, couples, office workers, pupils or students, they have a feature in common, that is
average or well-off condition. We interviewed some customers in restaurants to find out how
they think about the price of KFC products. The interviewees mainly said that the price
wasn’t too high given their incomes. Although they knew the price of fast food is higher than
other kind of foods, but in comparison with what they receive: the good services of staffs,
the beautiful space, and freely time, so the price seems to be acceptable. Therefore, they
evaluates that the real value of fast food is even lower than cooking at home or having meal
in other traditional restaurants which take them a lot of time. Those were the opinions of the
people usually came to fast food restaurants.
On the other hand, we also interviewed some randomly people and we asked the same
questions above. Some of them thought the price of fast food is too high. They also
compared the price of the food in KFC and that one in the market to prove the difference.
However, when they were asked to choose one kind of restaurants they will come to have
meal with friends or family, they still choose the restaurants which are somehow similar to
fast food restaurants. Their reasons were that they came there not simply for food but also
for having comfortable places to meet their friends, their families.
The Vietnamese economy is growing rapidly with increase and per capital from $288 in
1995 to $1,160 in 2010, according to the Vietnam- General Statics Office. This figures show
that the income of the Vietnamese at the time being is much higher than those of 1997 when
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KFC began to enter Vietnam. Their life’s quality is better, and they desire to live better, and
to consume more. They not only want to have enough food for meals anymore, but they also
demand to enjoy delicious food. Therefore, that creates great chances for KFC in particular
and for Western fast food industry in general to develop further in Vietnam.
However, let’s compare the GDP per capita and the expenses for KFC products. The GDP
per capital of Vietnam in 2010 is USD1, 160, corresponding to VND23, 200,000 per year. It
means the average income of one Vietnamese person per month is about VND1, 933,000.
Meanwhile, as we mention above, the average price of 1 combo in KFC is about VND40,
000. Therefore, if one person buy one KFC combo for one meal per day, he will lost
40,000*30= VND1, 200,000. It seems unacceptable for average-income people. Hence, it
may take a long time for Western-style fast food industry to actually spread widely and bring
convenience daily meals for the Vietnamese customers.
(C)
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The result of research seems to show that the development of western-style fast food
satisfied the demand and changes in the Vietnamese society especially the coming-torestaurant habit and the higher living standard. As the economy is developing, the living
condition is higher and people become busier with working, Hanoi people created the new
habits that they come to the restaurants with comfortable space to find different atmosphere
when they have chances. We might see that western-style fast food have opportunity to
become more common in the Vietnamese market. However, the development of KFC in
particular and western style fast food in Vietnam society will surely have some obstacles.
Looking in depth at the findings of our research results, we may see these hindrances.
The increase of KFC consumption level somehow shows the changes in daily diet of citizens
in the most developed regions of Vietnam. In these regions, the average income is higher and
affordable for the usual diets which are rich protein. In an investigation about high
cholesterol level in adults, implemented by Vietnam National Institute of Nutrition from
2007 to 2010, there are 43.4% of adults in cities like Hanoi and Ho Chi Minh City having
high cholesterol level because they eat meat more than vegetables and fruits(Nam Phuong,
2010). Another consequence is the relationship between the increasing fast food
consumption and obesity or weight gain (Currie, S.D., Enrico, & Vikram, 2009), especially
for children - the type of customer that have highest interest in western-style fast food. As
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we observed, many children who come to KFC restaurants are having the signs of
overweight. People in cities nowadays, with the development of media and internet, can
easily be aware of these consequences to their and family’s health. Therefore a question may
be inferred: whether western-style fast food’s development in Vietnam will be durably
potential?
As the results have mentioned above, western style fast food like KFC has bring a new
feature of industrial society to the Vietnam cuisine culture. The changes in coming-torestaurant habits occur mainly in the young generation. This arises as a certain phenomenon
in the process of integration as well as adaption of new cultures together with the
development of modern economy and society. However, it may have its own negative side.
For example, if the tendency to go out for meal becomes too popular, people depend too
much on the fast food or processed food and neglect cooking activities with their family. The
role of kitchen, a traditional place for family member gather together in meal time, become
blurrier and it may weaken the emotional linkage between family members.
Moreover, in fact, the price of western style fast foods is quite high in comparison with other
kinds of traditional food in Vietnam. The products of KFC, Lotteria, or BBQ… cannot
compete in term of price with the same food in the market. The price has just been suitable
for group of people who have good income. Besides the food, customers of KFC also have to
pay the service of restaurant and the expense to get a good space in a well-décor restaurant at
crowded streets in the center regions. Therefore, in the context of Vietnam today, with many
young people, coming to western-style fast food restaurants not only to satisfy the hunger
but also to show off their status, to let others know that they are modern and trendy. For that
reason, these people eat the same type of fried chicken, but the one eat it in KFC has the
feeling totally difference with throne in the market or normal restaurant. The courteous
space, the way customers are served and the reputation of KFC, all of these make them feel
pleasant and think that is what they can achieve at their status. But for the common
customers with average income or lower, the price of this fast food is so high that they
cannot afford.
It can be said that, in Vietnam, western style fast food is not popular for general public. Like
we said above, the development of fast food like KFC is obvious, but become the common
and convenient fast food for everyone might take a long time. It has just suited for specific
group of customers. Therefore, fast food firms like KFC has been much focused on
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localization to make it products more suitable with Vietnamese taste. For instance, in KFC
restaurant case, besides serving fried chicken with hamburger and fried potato which are
typical western taste, they might also give customer more choices with traditional rice and
soup. The taste also is diversified to give customer more choices. Three or four years ago, in
KFC restaurants, there are only less than 10 combos; now the number of combos jumped to
over 20 with various levels of price that fit with many customer tastes and incomes.
However, to bring their fast food closer to customer, there still are many tasks to do. For
example, the fast food enterprises can build strategies such as offering discount, diversifying
products and offering more vegetables. Besides, the companies should segment market more
clearly such as customers with high income and white- collar workers.
C)
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The main result we gained from the research is that the western-style fast food has
dramatically developed and might have a big potential to develop in the future. As we
analyzed above, the increase in level of KFC consumption together with enlargement of
KFC supply chain, the changes in the coming-to-restaurant habits and lower impact of fast
food price on customers somewhat proves that the development of KFC in particular, and
fast food in general is obvious. However, this development also leads to the changes of daily
diet and cuisine culture of Vietnamese.
With the characteristic of qualitative research, the findings about the developments of
western-style fast food in Hanoi will provide some suggestion for another study to test in the
quantitative side.
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REFERENCES
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