Farmers don’t benefit from global fast food chains

Farmers don’t benefit from global fast food chains

The global fast food chains in Vietnam do not intend to use the local materials.

Most of the biggest global fast food brands have made their presence in Vietnam, from KFC, Lotteria to Burger King and McDonald’s. And most of them serve the dishes made of the import materials.

Meat, potatoes, paper cups are all the imports

The representative of Lotteria said 80 percent of the materials used by Lotteria Vietnam over the last 15 years are made in Vietnam, but by the joint ventures between Vietnamese and foreign partners, not 100 percent domestic owned producers.

KFC has said that it is planning to increase the localization ratio of its products this year.

At McDonald’s Vietnam, only tomatoes and salad are from Vietnam – they are bought from Da Lat, while 100 percent of meat is imported from Australia, pork and potatoes are from the US. Even the paper cups or paper food boxes are also imported from neighboring countries like China or Malaysia.

All the foreign fast food chains, showing their satisfaction about the business performance in Vietnam, are planning to expand their chains in the market.

Lotteria Vietnam said its turnover accounts for 40 percent of the total fast food market’s turnover. KFC, Lotteria, Jollibee, Burger King all have affirmed they would set up more shops this year.

McDonald’s Vietnam said it received 20,000 clients just in the first two days of operation. Supposed that every client spent VND75,000, enough for a serving of burger and drink, it got the turnover of VND750 million a day, a very attractive figure.

Therefore, it is highly possible that more McDonald’s shops would be opened in 2014 and the upcoming years.

Opportunities for Vietnam?

All Vietnamese farm produce suppliers wish to become the material suppliers to the fast food giants. However, it is very difficult to obtain the opportunities of doing business with them.

Kao Sieu Luc, General Director of ABC, a sweets manufacturer which supplies bread to KFC, Lotteria and Burger King, said the fast food chains are always very demanding in the product quality and food hygiene. ABC had to undergo a strict procedure of having its products examined by the chains before it got the supply contracts with them.

ABC may also become the bread supplier for McDonald’s, commencing from the end of March 2014, when the machine McDonald’s wants ABC to import from the US arrives in Vietnam.

Vissan was once the supplier minced beef to some foreign fast food brands in Vietnam. However, the foreign partners have stopped using Vissan’s products, except Jollibee.

Vissan’s General Director Van Duc Muoi said producers must compete fiercely with other suppliers in the prices, quantities, services and quality to become the fast food’s partners.

Nguyen Thanh Tam from Lotteria Vietnam noted that foreign fast food chains find it difficult to choose 100 percent Vietnamese material suppliers because Vietnamese enterprises are small scaled, which cannot provide materials in high quality and stable quantity.

Meanwhile, big joint ventures can satisfy any demands from fast food chains thanks to their professional distribution networks.

Lotteria, with 185 shops nationwide, has set up a factory of its own in Binh Duong province to ensure the stable supplies of materials for the whole chain.

vietnamnet