Fast food giants such as McDonald's and Burger King have dominated the sector globally for decades, but

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Fast food giants such as McDonald's and Burger King have dominated the sector globally for decades, but unique cuisine culture and uncommon spending behaviors mean Vietnam is one of the few countries they are struggling to crack. McDonald's is expected to reach 100 stores within a decade. However, after four years it only has 16 stores across the country. In a similar vein, Burger King has opened only 11 stores over seven years of operations, despite an initial target of 60 stores across Vietnam by 2017.

According to market researcher Kantar World panel, western fast food does not suit the palates of the majority of Asian people. However, this does not seem to apply to China and Japan. Fast food joints are booming there as they are elsewhere globally. Burger King boasts 700 stores in China as of 2016 and 98 outlets in Japan currently; McDonald's has thus far opened 2,500 stores in China and 2,975 Japanese branches.

So, what makes Vietnam so unique, despite the many traits it shares with other Asian countries?

Vietnam has a wonderful culture of home cooking, with families taking the time to spend their dinners together. The local taste is also remarkably different in the amount of raw or cooked vegetables used, something very different from McDonald's and other Western fast-food franchises. Moreover, Vietnamese people are healthy eaters and hence calorie-laden fast food is not often a popular choice.

Renowned chef Anthony Bourdain once wrote: "You don't have to go looking for great food in Vietnam. Great food finds you. It's everywhere. In restaurants, cafes, little storefronts, in the streets; carried in makeshift portable kitchens on yokes borne by women vendors." I was not at all surprised that the little restaurant on Le van Huu Street where we used to buy our Sunday bun cha was the place where Anthony Bourdain took President Obama for dinner. Even though there are local adaptations in the menu of McDonald's, such as chicken rice and grilled pork rice with egg, the vast majority of customers were not prepared to visit McDonald's frequently.

As of 2018, there were around 540,000 food outlets in Vietnam, almost 430,000 out of which were local vendors. For decades, there has been a flourishing street-food culture in this country. Food is readily available, whether it is on land or water. Yes, you can even buy food from vendors who run their business from a boat too. However, Vietnam is not the only country famous for street food. China, Thailand, and Japan are well-known for local dishes, but they still entertain room for fast food development.

The sector in the US is popular directly because of the appeal of being quick and easy to take away. However, Vietnamese people can already easily find the same thing at street vendors, purchasing a bowl of pho noodles or a banh mi among other items. Incidentally, the time it takes to order and receive Vietnamese-style street dishes is even faster than at a branch of McDonald's or Burger King, which negates their entire premise and leaves them with little value in Vietnam. Locals and tourists alike commonly wait 5-7 minutes at a street store, while the time to get a hamburger or chicken wings generally falls around the 10–15-minute mark.

Additionally, the local motorbike culture also impacts hugely on the popularity of street food. Motorbike riders can easily pull over to the sidewalk to buy a banh mi or a pack of xoi (steam sticky rice) from street vendors, pay and receive the item, and ride off without ever leaving their vehicle of choice. Purchasing a burger from a fast-food chain will usually involve finding parking space and potential fees. Thus, fast-food branches will also lose the speed contest with local vendors.

Furthermore, the standard price of a banh mi, xoi or pho is also one of the reasons behind the slowing of fast-food store expansion in Vietnam. While the average price for one hamburger comes to VND50,000-70,000 ($2.1-3), the average price of banh mi or xoi is less than VND20,000 ($0.87). General director of Pathfinder Consultant, Tran Anh Tuan said that in other countries, fast foods are basic and pleasant dishes, but in Vietnam they are seen as middle- and high-end dishes, leading to their prices sitting high against the local average income.

What's next?

However, the Vietnamese have not turned away from all kinds of American fast food. Kentucky Fried Chicken (KFC), which entered the country 20 years ago, continues to be popular. So, what went wrong with fast food chains like McDonald's and Burger King? Despite their overwhelming popularity around the world, McDonald's and Burger King have not risen to dominance and are falling short of ambitions in Vietnam. Burger King has closed five restaurants in Ho Chi Minh City, Hanoi, and Danang in recent years. It is easy to enter a market, but sustaining a business and getting a sizeable portion of the pie is a whole different story.

Discuss the social and cultural environment that shapes the Vietnamese fast-food industry with examples