Vietnam’s three most popular fried chicken restaurant chains achieved combined sales of VND 4.3 trillion ($ 185.5 million) last year, up more than 11% year-on-year annual. South Korean brand Lotteria posted the highest revenue at VND 1.68 trillion ($ 72.5 million), up nearly 8% year-on-year. It has the largest number of outlets in Vietnam with more than 210 in more than 30 locations.
Lotteria’s performance improved with a growth rate above 2% recorded in 2018 and 2017, but below the double-digit rate it enjoyed from 2014 to 2016.
It was followed by the American brand KFC with sales of nearly 1.5 trillion VND ($ 64.3 million), up 1.3% year-on-year. In 2018 and 2017, its growth rate was 7.5% and 18.3% respectively.
KFC, the first of three to enter Vietnam, has more than 140 outlets in 32 locations. In third place, with sales of VND 1.1 trillion, was a Filipino brand Jollibee. With more than 100 outlets, Jollibee recorded the strongest growth of the three, at over 40% year-on-year.
Over the past three years, its annual growth rate has averaged over 37%, several times that of KFC and Lotteria. But of the three channels, only KFC posted a pre-tax profit of 102 billion dong last year, its fourth consecutive year of profit.
Lotteria and Jollibee have reported losses over the past five years. Last year, the two chains reported losses of VND 22 billion and VND 10 billion, respectively.
Market watchers have attributed the slower growth of fast food chains in recent years to the changing eating habits of Vietnamese, which emphasizes health over convenience.
Market research firm Nielsen had said earlier in a report that there was a growing percentage of Vietnamese identifying health as a sign of success rather than wealth. The growing number of cases of food contamination and environmental issues has also made people worry more about health issues, he said.
In 2018, there were 7,000 fast food establishments in Vietnam, a relatively insignificant number given that there are around 540,000 food and beverage companies comprising 430,000 street vendors, 80,000 restaurants and 22,000 cafes and bars, according to Dcorp R-Keep, a global company. which provides technological solutions to agrifood companies.