Q. Why are there no McDonald’s in Vietnam and other visible U.S. franchises?
A: Here are some answers that we have heard … what have you heard?
1. RE McDonald’s, what would a “cheese quarter-pounder” taste like without the famous “McDonald’s French Fries” … ? But the import tax on frozen french fries is too high, cost-prohibitive, and the soil/climate in Vietnam is such that the “McDonald’s French Fries” can’t be made from potatoes that are grown in Vietnam. The VN potato is rounder, while the McDonald’s French Fry potato is more “foot-ball shaped,” so that you get a longer french fry. Also the moisture content of a Vietnam-grown potato is different, and not suitable for making McDonald’s frozen french fries. Source: In about 1998 or 1999, when a delegation of the U.S. National Potato Council came to Ho Chi Minh City. A senior executive of J.S. Simplot was with the group, and he said essentially the same thing. Simplot “invented” the frozen french fry. See info from their web site.
Frozen Potatoes “Half a century ago, we started a revolution in foodservice with the invention of the frozen french fry. Today, we offer one of the most extensive lines of frozen potato products anywhere, giving you a wide range of cuts and flavor profiles with high quality and excellent profitability.”
Interested in what McDonald’s has to say?
Click here to for links to McDonald’s web site: International Franchising Application for Vietnam.
2. Tax and franchise/royalty payment restrictions make it less profitable or interesting than it could be, so the franchise industry has not yet developed very much.
However, this seems to be changing, as there are a number of franchises here in HCM City, including
Coffee Bean & Tea Leaf
Above three brought to HCMC by IFB Holdings, an AmCham Company
Hard Rock Café
Sotheby’s International Real Estate
AmCham involved in facilitating the set up of Dale Carnegie and Hard Rock Café, when they came on a mission organized by the U.S. Commercial Service in Oct 2006. Sotheby’s (Mar 2007) and Coldwell Banker (Apr 2007) contacted AmCham directly for assistance/introductions. Click the links below to see how AmCham helped.
AmCham is now supporting a Commerce Department-organized Franchise Mission to HCM City (Dec 9) and to Hanoi (Dec 7). 14 U.S. franchise companies will provide Vietnamese entrepreneurs the opportunity to partner with franchise business concepts that have been proven successful.
American Business Franchise Opportunities Oct 2006 . Both Hard Rock Cafe and Dale Carnegie came on this mission.