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Category: Food

Retail News Asia is committed to providing both local and global retailers with the latest Food and Food & Beverage news throughout the Asian market. This on a daily base.

  • Hong Kong fund to sell Japan, South Korea Burger King business

    Hong Kong fund to sell Japan, South Korea Burger King business

    Private equity firm Affinity Equity Partners is this week launching the sale of its Burger King fast-food businesses in South Korea and Japan, in a deal that could fetch more than US$1 billion, a person with knowledge of the matter told Reuters.

    Hong Kong-based Affinity has appointed Goldman Sachs to run the sale, which is targeting both private equity investors and strategic buyers, said the person, who declined to be identified as the information is confidential.

    The bank declined to comment.

    Affinity bought full control of Burger King South Korea in 2016 for about US$170 million and a year later acquired the American fast-food brand’s Japan franchise.

    The South Korean business reported 680 billion won (US$572 million) in revenue in 2021, with adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) at 80 billion won, said the person, adding its adjusted EBITDA in 2022 is expected to reach 100 billion won.

    Burger King Japan’s adjusted EBITDA in 2021 was 700 million yen (US$6 million), the person said.

    Global fast-food chains such as McDonald’s and Yum! Brands are trading at 20 to 30 times their EBITDA, Refinitiv Eikon data showed. Burger King India is trading at about 25 times of its EBITDA.

    Affinity and Burger King Japan did not immediately respond to a request for comment.

    An official at BKR Corporation, the operator of Burger King in South Korea, declined to comment.

    The Nikkei business daily first reported the sale on Monday (Jan 17).

    It comes as the consumer and retail sector faces tremendous challenges and disruption caused by the coronavirus pandemic.

    In South Korea, businesses have adapted by relying more on deliveries, which has prompted exponential growth for its food delivery apps.

    Burger King Korea said on Monday the number of monthly active users on its mobile app in December exceeded 1.4 million, the highest since the app was launched in May 2016.

    Since Affinity’s acquisition, Burger King has been in an expansion mode in South Korea and Japan.

    Burger King runs 440 outlets in South Korea, more than its rival McDonald’s.

    The Japan franchise said on Monday it would open three new outlets in January, bringing the total there to 149, with plans to open more “aggressively” in 2022.

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  • Starbucks expands delivery services in China with Meituan tie-up

    Starbucks expands delivery services in China with Meituan tie-up

    Starbucks said on Tuesday it has entered into a partnership with China’s Meituan that will allow its Chinese customers to order coffee delivery via the super app’s platform.

    The move will expand the U.S. coffee chain’s delivery footprint in China, which has since 2018 used Alibaba Group’s Ele.me as its exclusive delivery partner.

    The two companies will also launch a service that will allow Meituan users to make private bookings for a tasting of coffees and learn to make them at Starbucks stores, it said.

    Starbucks has 5,360 stores in more than 200 Chinese cities, making it the second-largest market only after the United States, according to the company’s most recent earnings report.

    The company also said it would utilize Meituan’s “superstore” feature under the partnership which will see each of its stores have its own unique page on Meituan’s platforms by the end of this year, from which customers can book food delivery services or check local events.

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  • Cognac sales jump 31 per cent as drinkers go upmarket

    Cognac sales jump 31 per cent as drinkers go upmarket

    Cognac sales surged by nearly a third last year as American and Chinese drinkers guzzled old vintages, in the latest sign premium drinks makers are putting the pandemic behind them.

    Sales of the brandy, produced in the Cognac region of France, rose by almost 31 percent in value to €3.6 billion (US$4.1 billion), industry group BNIC said on Monday.

    Volumes were up 16 percent to 223.2 million bottles.

    “This growth reflects a real recovery of cognac, as well as new consumption habits,” BNIC said in a statement, noting sales had also risen compared with 2019, before the pandemic struck.

    The outlook should remain positive in the coming months for all destinations, BNIC added.

    The news comes after France’s champagne industry said last month it expected record sales in 2021, and follows strong results from several spirits companies.

    Cognac sales to its largest market, the United States, climbed 11 percent, with 115 million bottles shipped in 2021.

    Sales to China, its second-biggest, leapt 56 percent with 34 million bottles shipped, while European sales were up 8 percent to reach 37.1 million bottles.

    In late November, spirits group Remy Cointreau raised its full-year profit forecast after a better-than-expected first half, driven by strong demand for its premium cognac in China, the United States, and Europe.

    Pernod Ricard, which owns Martell cognac, also pointed to a jump in sales in China.

    The 2021 harvest, at 867,312 hectolitres, was within the 10-year average and should support further growth for the sector, BNIC said.

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  • KFC China draws wrath over Pop Mart frenzy that ‘wastes food’

    KFC China draws wrath over Pop Mart frenzy that ‘wastes food’

    KFC is under scrutiny in China over the popularity of an anniversary promotion that allowed customers to collect limited-edition toys with their meals.

    The fried chicken chain partnered with Chinese toymaker Pop Mart to give away Dimoo toy dolls with select KFC orders in celebration of the brand’s 35th anniversary of its first restaurant in China. The giveaway prompted a frenzy to collect the dolls, with at least one customer spending $1,649 to buy 106 meals, according to a statement from The China Consumers Association.

    Some would-be collectors hired helpers to buy meals and find toys for them, in some cases throwing away the food they were required to buy, the group said.

    “KFC, as a food operator, uses the limited-edition blind box sales method to induce and condone consumers’ irrational and excessive purchase of food packages,” the organization wrote, which is “contrary to public order, good customs and the spirit of the law.”

    KFC’s parent company Yum! Brands did not immediately respond to Insider’s request for comment.

    China has taken legal steps in recent years to curb food waste from promotions, including a major campaign in 2020 banning influencers from posting “wasteful binge eating” videos on social media.

    Spending sprees around limited-edition fast-food items aren’t exclusive to China. In 2021, McDonald’s included limited-edition Pokemon cards in some Happy Meals in the US, and fans quickly began buying up 50 to 100 cards at once to keep or resell, prompting some locations to begin limiting order sizes.

    Fan excitement over McDonald’s “Rick and Morty”–inspired Szechuan sauce was even more extreme, with some dedicated customers buying sauce packets online for hundreds of dollars, or even purchasing photos of the packets.

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  • Corona introduces its first non-alcoholic beer, infused with Vitamin D

    Corona introduces its first non-alcoholic beer, infused with Vitamin D

    Today, global beer brand Corona is proud to announce the worldwide launch of Corona Sunbrew 0.0%. This innovative, first-of-its-kind, non-alcoholic beer contains 30 percent of the daily value of vitamin D per 330 mL serving in Canada. As the newest member of the Corona family, a brand that celebrates getting outside and enjoying life in the sun, Corona Sunbrew 0.0% allows consumers to have “Sunshine, Anytime” every season.

    “As a brand that was born on the beach, Corona embraces the outdoors in everything we do, because we believe that outside is where people best disconnect and relax. The feeling of the sun is one of the things that people love most about the outdoors and the Corona brand is always innovating to remind them of that feeling,” said Felipe Ambra, Global Vice President for Corona. “Now, we’re excited to offer consumers Corona Sunbrew 0.0%, the first non-alcoholic beer with vitamin D, reinforcing our desire to help people reconnect to nature, anytime.”

    According to IWSR, the global no/low alcohol category total volume is forecasted to grow by 31% by 2024. Corona Sunbrew 0.0% provides consumers looking for a non-alcoholic beer with a unique new option. Corona Sunbrew 0.0% contains 30 percent of the daily value of vitamin D in Canada and 60 calories per 330 ML serving.

    Corona Sunbrew 0.0% maintains Corona’s essence; it was developed from Corona Extra by extracting the alcohol and then blending the non-alcoholic beer with vitamin D and natural flavours to reach the final recipe. This launch also demonstrates AB InBev’s continued commitment to smart drinking to help reduce and prevent the harmful use of alcohol across the world.

    “After numerous and rigorous trials, Corona Sunbrew 0.0% proudly showcases our ability to find solutions, gaps, and opportunities for growth as a brand,” said Brad Weaver, Global Vice President of Innovation Research & Development for ABInBev. “The journey was not easy as vitamin D is sensitive to oxygen and light, and not easily soluble in water. But thanks to our ongoing investment in innovation and research and development, our team was able to create the only non-alcoholic beer with vitamin D, providing a unique opportunity in the market.”

    Corona Sunbrew 0.0% will be available to consumers in a few distinct phases. The global brand will first launch Corona Sunbrew 0.0% in Canada, precisely at the time of year where most Canadians experience limited sunlight, making it an ideal market to launch an innovation from a brand synonymous with the beach and celebrations outdoors. Later this year, Corona will extend the non-alcoholic product offering in the UK followed by key markets across the rest of Europe, South America, and Asia.

    Creative Agency DAVID Miami collaborated closely with Corona on the development of Corona Sunbrew 0.0% from its very inception, more than two years ago. As an ongoing brand partner, DAVID proactively presented the idea for Corona to develop a beverage containing vitamin D.

    “Each detail of the project is special. From the product ideation to the final campaign. It’s not every day that we have the chance to present a product idea and have an innovative client like Corona buy, develop and take it to the next level. A true collaborative effort,” says Pancho Cassis, Global Chief Creative Officer at DAVID.

    To help support the launch of Corona Sunbrew 0.0%, Corona will unveil a new creative campaign capturing the enjoyment of “Sunshine, Anytime.” A compilation of scenes filmed on a pristine beach in Costa Rica presents the pleasure of outdoor living and the boundless positive energy of the sun. The new Corona Sunbrew 0.0% campaign taps into the feeling of being carefree and relaxed. The 360-degree integrated marketing campaign, created by DAVID Miami and Director Juan Cabral, inspires consumers to enjoy the Corona lifestyle, which is best experienced with sunshine.

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  • KitKat collaborates with Byron Bay Cookies

    KitKat collaborates with Byron Bay Cookies

    KitKat has teamed up with Byron Bay cookies to create every dessert lover’s dream. Chocolate and cookies are two of the best sweet snacks in existence. We don’t make the rules.

    And clearly, KitKat is onto the same thing as us because they’ve launched two new flavors inspired by everyone’s favorite café treat, the Byron Bay cookie. It’s every cookie and chocolate lover’s dream.

    Dubbed the “sweet treat collab of the summer”, there are two flavors to choose from – KitKat inspired by Byron Bay Cookies – Milk Choc Chunk and KitKat inspired by Byron Bay Cookies – Triple Choc.

    For cookie lovers, the Milk Choc Chunk will be right up your street. With crisp wafer fingers covered in white chocolate, topped with cookie pieces on a milk chocolate base. For those wanting an extra hit of chocolate, the Triple Choc option has you sorted with milk chocolate-covered chocolate wafer fingers topped with crunchy cookie pieces.

    Upon announcing the launch, Nestlé’s head of marketing – confectionery, Joyce Tan said: “We’re so excited to introduce KitKat brand’s first Australian collaboration to the market, and thrilled that it’s with the iconic and beloved local cookie maker Byron Bay Cookies.

    “We know Aussies will love these tasty additions to the KitKat range, and each bite is sure to transport them to their own beachside Byron Bay break!”

    Meanwhile, Byron Bay Cookie company director, Bill Quayle said: “We are thrilled to be partnering with a global brand like KitKat to create such a delicious collaboration.”

    Both creations are available in a 170g block, selling for $5.00. The Milk Choc Chunk option is also available in a 45g bar ($2.00), and the Triple Choc in a 65g bar ($2.50).

    You can find the new creations in supermarkets and convenience retailers nationally, as well as online, in-store, and within a hamper from KitKat Chocolatory.

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  • Kellogg partners with Bega in peanut-butter flavoured cereal

    Kellogg partners with Bega in peanut-butter flavoured cereal

    Australia’s iconic breakfast brand Nutri-Grain has delighted fans with the launch of a new flavor mash-up that’s set to take your cereal game to the next level. Nutri-Grain has joined forces with Bega Peanut Butter to create an epic flavor combination with a nutty twist. The limited-edition Nutri-Grain Bega Peanut Butter Flavor Cereal consists of the iconic malty crunch that we know and love, followed by a flavor hit of peanut buttery goodness.

    Serving up an “epic taste explosion”, shoppers can grab a box for just $6.95 at Woolworths.

    The new creation comes off the back of the Nutri-Grain x OAK Plus and Coco Pops x Golden Gaytime collabs.

    “Australia went mad for our collabs last year, so we’ve upped the ante with another unstoppable collab,” Dan Bitti, Kellogg’s breakfast lead, said.

    “We’ve brought together the malty-crunch and peanut pieces to bring Aussies something new, that up until now they could have only ever dreamed about.

    Jacqui Roth, marketing manager, Spreads at Bega said: “We’re thrilled to be teaming up with Nutri-Grain. We can’t think of a butter brand to partner with as Bega Peanut Butter makes its debut in the cereal aisle.”

    Meanwhile, KitKat has launched two new flavors inspired by the original café cookie; Byron Bay Cookies.

    With the sweet treat collaboration of the summer, Aussies can now enjoy KitKat Inspired by Byron Bay Cookies – Milk Choc Chunk and Triple Choc.

    Now on supermarket shelves across Australia, the new creation marks the confectionary brand’s exciting first collaboration with an Australian brand, paving the way in cookie creations with an iconic local player.

    The new flavors are set to be a hit, with two options available to satisfy any and all chocolatey cookie cravings.

    The Milk Choc Chunk will delight the biggest cookie lovers, with crisp wafer fingers covered in white choc, topped with cookie pieces on a milk chocolate base.

    For those looking for an extra chocolatey hit, the Triple Choc has you sorted with milk chocolate-covered chocolate wafer fingers topped with crunchy cookie pieces.

    “We’re so excited to introduce KitKat brand’s first Australian collaboration to the market, and thrilled that it’s with iconic and beloved local cookie maker Byron Bay Cookies,” Nestlé head of marketing – confectionery Joyce Tan said.

    “We know Aussies will love these tasty additions to the range, and each bite is sure to transport them to their own beachside Byron Bay break.”

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  • Disgraced McDonald’s ex-CEO pays back US$105m in settlement

    Disgraced McDonald’s ex-CEO pays back US$105m in settlement

    McDonald’s has settled a lawsuit with former CEO Steve Easterbrook, forcing the disgraced executive to repay his severance package of more than $100 million.

    Easterbrook was fired in 2019 after the fast-food giant’s board determined that he violated company policy by demonstrating poor judgment involving a recent consensual relationship with an employee. In August 2020, McDonald’s filed a lawsuit against Easterbrook for lying to the board about the extent of his relationships with employees.

    In a filing to the US Security and Exchange Commission Thursday, McDonald’s criticized Easterbrook for his misconduct, lies, and efforts to impede investigations into his actions and that the settlement is the best path forward.

    This settlement holds Steve Easterbrook accountable for his clear misconduct, including the way in which he exploited his position as CEO, Enrique Hernandez, Jr., the chairman of McDonald’s board of directors, said in the filing. The resolution avoids a protracted court process and allows us to move forward.

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  • Papa John’s opening 1,350 stores in China

    Papa John’s opening 1,350 stores in China

    The pizza chain plans to open over 1,350 stores in South China by 2040 in partnership with the Asian private equity firm FountainVest Partners, it said on Friday. The deal will increase Papa Johns’s current global count by 25%, and marks the largest franchisee development agreement in the pizza company’s history.

    Pizza companies have lately been expanding their footsteps in the region, where they see an opportunity to boost sales.

    Pizza Hut, for example, opened 103 new stores in China in the third quarter. And Domino’s (DPZ) CEO Ritch Allison said in October that “with each passing quarter, we become even more confident about the long-term growth potential for the Domino’s brand in China.” He noted that in the third quarter of 2021, Chinese locations open at least a year grew sales by a percentage in the double-digits — way better than in the United States, where sales fell in the third quarter.

    Late last year, Papa Johns CEO Rob Lynch pointed to China as fertile ground for growth for his company, as well.

    Papa Johns has a “huge development opportunity in markets where we already compete but are much less penetrated,” compared to the competitors, Lynch said at the time. “I would offer China as an example,”

    Papa Johns has also been expanding into other regions. In November, the company announced plans to open 60 restaurants in Kenya in Uganda in the coming years along with franchise partner Kitchen Express. Over the summer, it expanded its partnership with its largest franchise, Drake Food Service International, with plans to open 220 restaurants globally, including in the UK and Latin America, by 2025.

    The “partnership with FountainVest marks another major milestone in achieving Papa Johns’s global growth potential,” Lynch said in a statement on Friday.

    The move follows a rebrand undertaken by Papa Johns last year when the company dropped the apostrophe in “Johns” and updated its log and store designs.

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  • 300,000 tonnes of dragon fruit have no buyers

    300,000 tonnes of dragon fruit have no buyers

    Around 300,000 tonnes of dragon fruit will soon be ripe for harvest but without buyers, as China clamps down on border trade, industry insiders said. With the northern provinces of Quang Ninh and Lang Son having both restricted trade at the border with China due to containers pilling up, many Chinese buyers have stopped purchasing Vietnamese dragon fruit, Phan Van Tan, deputy director of Binh Thuan’s Department of Agriculture and Rural Development, told a forum Thursday.

    Dragon fruit prices have dropped in the last few weeks as China tightened its Covid-19 measures that caused thousands of container trucks to get stuck at the border.

    Some exporters said they have tried to transport goods via sea but this is not a sustainable solution as shipping fees have surged three times from before.

    China has been the biggest buyer of Vietnamese agricultural produce and dragon fruit for years. Dragon fruit exports to China exceed that of 50 other markets, said Nguyen Khac Huy, CEO of Hoang Phat Fruit in Long An Province.

    China’s proximity to Vietnam explains why exporters prefer to send their fruit there over other destinations like Europe, which could take up to 42 days. Vietnam produces around 1.4 million tonnes of dragon fruit every year. Eighty percent comes from the three provinces of Binh Thuan, Long An, and Tien Giang.

    Deputy Minister of Industry and Trade Tran Thanh Nam suggested supermarkets nationwide buy the fruit to support farmers.

    The ministry will also hold a forum with trade offices in Europe to diversify output, he added.

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  • $4 Starbucks coffee has become a daily staple

    $4 Starbucks coffee has become a daily staple

    While the franchise’s 2021 financial results took a hit because of the Covid-19 pandemic, a tangible gain has been the Starbucks VND90,000 ($4)coffee becoming a daily staple in Vietnam.

    Starbucks Vietnam general manager Patricia Marques said that despite the impacts of the nine-week social distancing orders in 2021, the global coffee brand has built up a regular customer base for its coffee worth VND90,000-100,000.

    She said it has also established more outlets away from the downtown in new urban areas, buildings, and local communities. While people used to prefer living close to the center of a locality, they are willing to live a little further away these days, she said.

    Starbucks Vietnam closed three outlets but opened nine new ones in 2021. Between December 2021 and January 2022, it opened another six: three in Hanoi; two in HCMC; and one in the southern province of Binh Duong.

    In Vietnam, Starbucks currently has 77 outlets whose takeaway sales have grown amid Covid-19 outbreaks.

    Marques said she expected instability to continue in Vietnam’s food and beverage market this year, but takeaway revenue, non-cash payment, and e-commerce would continue to grow.

    While there is still a lot of vacant space, it will not be easy for food and beverage businesses to find satisfactory locations at a reasonable price, she said. Citing data from a partner, she said the rent of commercial premises in Vietnam increased by 3 percent, while it decreased 10 percent in Singapore, Hong Kong, Thailand, Cambodia, and Laos.

    According to the brands’ official websites, chains with the highest number of outlets in Vietnam are the domestic brands Highlands (462 stores), The Coffee House (146), and Trung Nguyen (89).

    U.S.-based Starbucks made consolidated revenues of $29.1 billion in the fiscal year 2021 (ending in the third quarter of 2021), up 24 percent against over 2020.

    In the fiscal year 2022, the brand expects global earnings of $32.5-33 billion, beating Wall Street’s estimate of $32.07 billion, and plans to open about 2,000 new outlets globally, three-quarters of them outside the U.S. According to data recorded by Statista, as of November 2021, Starbucks had 33,833 outlets worldwide.

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  • Arnott’s reveals this year’s new Tim Tam Deluxe flavours

    Arnott’s reveals this year’s new Tim Tam Deluxe flavours

    If your new year’s resolution for 2022 is to eat cleaner, we suggest you hit pause for a couple of weeks because Tim Tam’s new range will be too good to miss. Arnott’s has just revealed that a brand new Tim Tam Deluxe range will be hitting supermarket shelves early next year, and is anticipated to be the most indulgent EVER. Even better, it has given us a teaser by introducing one of its six new flavors… Decadent Triple Choc!

    Tim Tam’s Decadent Triple Choc biscuit is the first of the Tim Tam Deluxe range to be released and, boyyyy is it a goodie. The new bikkie features an irresistible milk chocolate coating, with extra choc covering two crunchy biscuits, sandwiching a velvety choc cream and, wait for it… an EXTRA gooey centre. Did you get through that without salivating? Because we sure didn’t.

    The entire range won’t be revealed in full or on shelves until early 2022, so keep your eyes peeled and your appetites whet.

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  • Food establishments learn to be agile amid pandemic

    Food establishments learn to be agile amid pandemic

    Hit hard by the Covid-19 pandemic, the food and beverage industry has nevertheless learned valuable lessons in flexibility and labor retention.

    Accommodation and food establishments saw revenues decline by 19 percent in 2021 to VND398 trillion ($17.3 billion), according to data from the General Statistics Office.

    The southern province of Ba Ria – Vung Tau reported the steepest decline of over 50 percent, followed by HCMC at more than 46 percent. In Binh Duong and Dong Nai provinces and Hai Phong, Hanoi, and Da Nang cities, the decline was 14-23 percent.

    According to the ranking company Vietnam Report, over 90 percent of businesses in the F&B industry was seriously affected by the pandemic in 2021, especially in terms of logistics, distribution, and labor safety.

    Some 35 percent also faced challenges related to rentals and labor availability.

    A spokesperson for the Dau Homemade restaurant chain said a widespread difficulty the industry faced amid the pandemic was a labor shortage. To retain workers, his chain arranged working shifts more appropriately and did not cut salaries, he said.

    During nearly half a year of stay-at-work, Dau Homemade and Gong Cha milk tea chains covered their workers’ basic daily expenses and regular Covid testing fees.

    A spokesperson for Dai Moc Food, which supplies food to factories and hospitals, said besides taking care of employees, it is also necessary to take care of their loved ones so that they are at ease while working.

    Dai Moc provided fresh food to employees’ families, visited them, and paid salaries in advance if workers asked for them, he said.

    Dau Homemade switched from the restaurant business to foodstuff production and vegetable sales.

    Besides ensuring product quality, Gong Cha has focused on training employees how to deal with Covid-related situations such

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  • Product fraud could be costing Australia $3bn a year

    Product fraud could be costing Australia $3bn a year

    Fibre fraudulence involving the ‘high risk’ commodities of veal, wine, fish and mollusks fell between $700 million to $1.3 billion.

    According to the report, the cost of fraud in the sheep meat, wool, wheat, horticulture and dairy products sectors is believed to cost the industry up to another $700 million annually.

    Georgia Townsend, Agrifutures’ National Rural Issues Manager said producers’ pockets are at risk of being raided if the fraudulent activity isn’t addressed:

    “Farmers can’t combat this issue alone; a coordinated supply chain approach is needed if we are to overcome the billion-dollar problem and stamp out fraudulent practices.”

    “This work is important in quantifying the situation and gives producers, exporters and retailers market mechanisms and technologies to detect and mitigate fraudulent activity.”

    The report was conducted by Deakin University and Professor Rebecca Lester, Director of Deakin University’s Centre for Regional and Rural Futures said it is vital that the industry mitigates risks attached to high-level fraud:

    “Guaranteeing a product’s origins can be costly, but authenticity testing places emphasis on early detection and prevention, rather than responding to problems once they occur.”

    “Fortunately technology has come a long way and avenues now exist to guarantee product authenticity through analytical testing of the product itself. Technologies such as next-generation DNA sequencing, DNA chips, and lab-on-a-chip technology offer great potential for effective, low-cost and rapid onsite solutions for a broad range of authenticity testing of products.”

    aware of the risk of food fraud once their product leaves the farm or boat, but it may be costing them dearly. Industry must arm itself with better information about what to look for and strategies to respond if confronted by fraudulent activity. Getting on top of the problem could save the sector up to $3 billion annually.”

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  • Low-cost café franchising booms despite Covid

    Low-cost café franchising booms despite Covid

    Despite the Covid-19 pandemic, more and more low-price cafés are franchising and doing well. At 9.00 every day a Napoli café franchisee on Dong Nai Road, District 10, HCMC is crowded. Its owner, Hoang, says: “We directly serve hundreds of customers a day. The number of customers making orders via apps is double that.”

    A café franchised by Milano on Pham Van Chieu Road, Go Vap District, also gets hundreds of customers daily, one of its employees says.

    Many other similar outlets are also making good profits despite the pandemic, mainly selling through apps and e-commerce websites.

    Nguyen Duc Hung, the founder of Napoli Coffee, said that after starting in 2010 his company has so far franchised 3,000 outlets which fetch hundreds of billions of dong annually.

    “We franchise an average of two to three coffee shops a month. Some of our partners want to open more shops though they already own five”.

    Now there are thousands of Milano franchisees across the country. Trung Nguyen E-Coffee franchised coffee shops are present in 54 cities and provinces.

    The franchisors do not seek royalties for their trademarks or other such fees, and most of their profits come instead from the construction and decoration of coffee shops or sales of packaged coffee and beverages they produce

    Napoli offers three franchising packages costing VND70-350 million for cafes of 50-100 square meters in size. The packages include a five-year warranty, decoration, furniture, lighting, uniforms, and the coffee-making process, and exclude the costs of sanitary equipment and salaries.

    Trung Nguyen E-Coffee offers franchising packages worth VND65-175 million.

    Le Anh Tu, a lecturer at Van Lang University in HCMC, said the low-price café franchising model thrives despite Covid because franchisors support franchisees a lot, and products are sold at reasonable prices like VND12,000-30,000 for a cup of coffee.

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