Is KFC successful in Vietnam

KFC is one of the most famous fast food brands all over the world. In 1997, KFC launched the first restaurant in Ho Chi Minh city, Vietnam. At first, KFC suffered losses in 7 years. There are several reasons can explain why KFC was not successful in Vietnam. The first reason was KFC did not understand about Vietnam, it could not compete with the street foods. At that time, the brand was still unknown to the Vietnamese. Comparing the prices of KFC to street foods, it was too expensive. It seemed like luxury restaurant to Vietnamese which only rich people can afford to eat.

The other reason was during the time, the Internet was not developed. Internet is one of the ways to advertise the brand. Now, with the advantages of developed technology, people can access news and advertisements easily, which can help the brand to develop their strategy.

This is one of the advertisements of KFC in Vietnam:

The third reason was KFC did not understand the tastes of Vietnamese. Not many Vietnamese could eat the western dishes. The KFC just thought the Vietnamese was exactly like American. This was the reason why they failed. They should have learned the market before entering Vietnam.

Although KFC failed for 7 years but they did not give up. They have tried to learn and did the market research. Now, the menu in restaurants has been updated every year to meet the needs of Vietnamese such as they included the cabbage mix, crispy chicken salad, soft bread and KFC fish rice in the menu.

Moreover, prices are also very important. They have set reasonable prices for anyone can afford to buy.  Now, KFC is very successful in Vietnam, it accounted for 60% market share in the Vietnam’s fast food industry.

In order to maintain the brand image, KFC has set strategies to gain customers. For instance, promotions with coupon. After buying food in KFC, staff will give customers coupon to get discount for next time eating in any KFC restaurant. And also, KFC has found that the youth are the main customers because older and middle age Vietnamese prefer Vietnamese than Western food. 

Here is the link which shows some fun facts about fast food in Vietnam:

http://www.vietnamfood.org/overview/fast-food.html 

SWOT

Strategy is defined as the long-term plan in order to achieve certain goals and objectives.

This is picture shows type of strategies:

SWOT analysis is a very useful tool that a business could use to develop their strategy. It identifies the strengths, weaknesses, opportunities and threats within organization. 

As you can see in the picture, strengths and weaknesses are the internal factors in a business. 

       Strengths: - What are the advantages in a business?

                        - What are the resources a business has?

                       - What are the achievements? 

For example, Apple is an American multinational company that sells electronic devices such as Iphone, Ipod and Macbook. It has many strengths such as it is one of the world's largest technology company; it has powerful image and customer base. 

    

     Weaknesses: - What are the internal problems that the business has?

                               - What will the people around you see as your weaknesses? 

             For example, Apple has limited products so customers will change to use alternative products such as Samsung or HTC.

Opportunities and threats are the external factors to a business. 

        Opportunities: a business should see the best opportunities to do the business such as what are the best times to launch products or is it the rivalry weak to enter the market?

        Threats: a company should see what are the obstacles that it is facing. Environment, political, legislation effects could be the threats to a company. For example, Samsung is the threat to Apple because it is also the world largest electronic companies and it has lots of customers.

Strengths and opportunities are the good factors; and weaknesses and threats are the harmful factors to a business.

The SWOT matrix

 A SWOT  matrix (also known as TOWS matrix) is a combination of internal and external factors in order to develop strategies. 


S-O: the strategies which based on the strength of the organization, they can maximize the opportunities.


S-T: the strategies that find the best way to avoid the threats by using the strengths of the organization.


W-O: the strategies that find the best opportunities to reduce the weaknesses.


W-T: the strategies which is planned to avoid threats and reduce weaknesses.