Marketing Random

Franchising: A great opportunity for Vietnamese businesses


Franchising not only brings great benefits for franchisors but also minimizes risks for franchisors.

Create “2-way” opportunities

Franchise is a business partnership in which 1 partner allows the other to use a copy of its successful, tested business system in exchange for the benefit of the initial license fee. and the associated license fees for the term of the contract.

Franchising is considered a common trend and is growing strongly in the world. In the context of the increasingly integrated economy, Vietnam is not out of that trend. Recently, the domestic franchise market has witnessed the participation of both foreign and domestic businesses. This has been creating excitement in the Vietnamese market.


In 1997, the world famous food brand KFC first appeared in Vietnam, followed by a series of other famous names such as Lotteria, biza Hurt … In recent years, major brands in the world poured. More and more sets are coming to Vietnam such as: Starbucks, McDonald’s … Like in many other countries around the world, in Vietnam, most of these “giants” choose to develop through the franchise route.

KFC, one of the major brands in the world, has franchised franchises in Vietnam. Artwork: KT.

According to economist Le Dang Doanh, business development towards franchising has helped businesses take advantage of capital as well as human resources from partners to expand business. At the same time, increasing revenue and profit from franchising expenses increases brand value, especially, enhances the business. This is a very smart way to mobilize capital and human resources of foreign investors.

Mr. Doanh also said that not only brings great benefits to the franchisor, this model also minimizes the risk to the franchisee. Thanks to the prestige of big franchised brands, the products of small and medium enterprises are strongly consumed in the market and known to consumers. These businesses save a huge amount of money to build brands as well as significantly save advertising and sales promotion costs.

According to Mr. Lai Tien Manh, Director of Brand Consulting Company Mibrand, franchising helps consumers to have more choices about products. Because the big brands before franchising into Vietnam have been known by many Vietnamese consumers. When “landed” in, it will create curiosity and many people want to experience and use such brands.


Increase competition

Franchising will create certain pressures, but also create opportunities for local businesses.

In addition to the value brought, the franchising of big and well-known brands will put great pressure on Vietnamese brands doing business in the same field. Enterprises will have more competitors in the market and their potential customers will have to “share” with partners.

Mr. Lai Tien Manh said that franchising will create certain pressure, but also create opportunities for domestic businesses. For progressive businesses, they will find this is the time to invest more in technology, facilities, processes and further improve their operational capacity to compete with franchised brands. In the world. Competitive pressure will create pressure to change for businesses themselves.

According to economist Le Dang Doanh, in the context of today’s extensive integration, the franchise taking place in the world in general and in Vietnam in particular is inevitable. Under such general conditions, Vietnamese businesses will have to compete more fiercely with major brands in the world. To be able to stand firmly in the marketplace, Vietnamese businesses have no choice but to improve their technology and product quality. At the same time, find a market segment that they can stand, that market may be in the countryside, maybe an area of ​​business that the other brand, the other business cannot reach.

* Source: VOV



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