Ronald McDonald is on hand. (Thomas Maresca, USA TODAY)
HO CHI MINH CITY (USA TODAY) -- Techno music blasted as a crowd of hundreds
lined up behind velvet ropes, waiting to gain entrance into the city's
hottest new attraction.
But it wasn't a new nightclub that residents had queued up for in this energetic city of more than 7 million; these lines were for the grand opening of the first McDonald's in Vietnam.
8 a.m. Saturday, a large throng had gathered. When the doors officially
opened two hours later, eager customers surged into the colorful new
350-seat restaurant to sample Big Macs, french fries, Chicken McNuggets
and one menu item added specifically for the Vietnamese market - the
A handful of cars and a legion of motorbikes -
still the predominant means of transportation in Vietnam - moved
haltingly through the country's first drive-through, with staff on hand
to help explain the ordering system.
Free balloons, face-painting,
live performers and photo-ops with Ronald McDonald created a festive
atmosphere, while proud parents and grandparents of new McDonald's
employees buzzed around the restaurant with cameras and video recorders.
some of the first customers, it was a welcome taste of home. Joe
Shipley, whose company operates a foundry in nearby Binh Duong province,
was enjoying lunch on the outdoor terrace with his wife, Sherry, and
their three children.
The Shipleys are from Fort Wayne, Ind., and
have been living in Vietnam for almost a year. Sherry Shipley said their
kids had been so excited to come to McDonald's that they woke up at
"It's nice to see a little bit of America here," she said.
For most of the Vietnamese customers, it was a chance to experience an iconic brand that they had only known from afar.
group of teens and 20-somethings had been wondering when McDonald's
would finally come to Vietnam, and the group wholeheartedly agreed that
the burgers and chicken sandwiches were well worth the wait. But the
french fries didn't go over as well, with piles left unfinished on
several of their trays.
"We don't really like the fries," admitted Mai Phu Toan, 24.
food is not the main attraction of McDonald's at this point, said Ralf
Matthaes, regional managing director of TNS, a market research company.
are not necessarily going to fast food for the wonderful taste," he
said. "Coming to McDonald's is more of a treat, more of something
The businessman who brought McDonald's to Vietnam,
developmental licensee Henry Nguyen, said the opening was an important
moment both for the company and the country as it continues to develop.
think in many ways McDonald's is a symbol of something bigger,
particularly for a country or market when it enters. I think it's a big
deal for McDonald's, and I think it's something that people here feel is
a special milestone," he said.
Nguyen said that one reason it
took McDonald's so long to come to Vietnam is that the company is
meticulous in its preparation before entering any market.
is a very careful organization," he said. "If you show up in a market
you've got to do things right. The food standards have got to be there,
so supply chain was definitely an issue. But from what I know, Vietnam
has been at the top of McDonald's list of the next market to open for a
very long time."
For Oak Brook, Ill.-based McDonald's, Vietnam is
one of its largest remaining untapped markets, a country with 90 million
people and a growing middle class that is able to afford fast food,
which is typically more expensive than local street food. At McDonald's,
a Big Mac costs 60,000 Vietnamese Dong ($2.82), while a value meal with
fries and a drink goes for 85,000 Vietnamese Dong ($3.99).
to data from market research firm Euromonitor International, Vietnam's
fast-food industry is small but growing rapidly. Total revenues were
$535 million in 2013, a growth of 14.5% over the previous year.
first foreign fast-food chain to enter Vietnam was KFC in 1997, only a
few years after the U.S. normalized trade relations. KFC remains the
largest brand in Vietnam, with 135 locations, according to its website.
recent years, however, the market has grown more crowded as several
U.S.-based fast-food chains have made the leap into Vietnam.
King arrived in 2011, and has expanded quickly, with almost 20
restaurants in Ho Chi Minh City, Hanoi and Danang. Other recent entrants
include Baskin-Robbins, Dairy Queen, Carl's Jr., Popeyes Louisiana
Kitchen and Subway. Starbucks opened its first store to much fanfare in
2013, and now has three locations in Ho Chi Minh City.
the 38th country that McDonald's has entered in Asia, and the Ho Chi
Minh City restaurant will be inaugurated on Monday by CEO Donald
Thompson as the region's 10,000th location. The company has more than
35,000 restaurants worldwide.
Matthaes said McDonald's entry into
Vietnam has actually been helped by a recession that has brought down
the price of real estate.
"Vietnam is in the middle of a recession, but what that actually creates is a lower cost of entry," he said.
said McDonald's plans to expand "as fast as we can," with a target of
100 restaurants in 10 years. The biggest challenges will be training the
workforce and creating a supply chain that will meet international
standards, he said.
"Right now today the majority of what we serve
is imported food," Nguyen said. "The long-term goal over the next five
to 10 years is that we help develop a local supply chain. That to me is
one of the peripheral benefits for why I wanted to be a part of this.
We're going to change the food industry here."
For now, however,
most Vietnamese customers still eat out in small local shops such as Pho
Loc, which sells Vietnam's popular pho noodle soup only a few hundred
feet down the street from the new McDonald's.
Tran Ngoc Anh, 63, has been running the restaurant for 30 years and said she isn't worried that the new giant down the street will draw away her customers.
"It's just fast food," she said. "It doesn't have all the delicious flavors of pho."
Still, she planned to stop by and give McDonald's a try later in the afternoon after she finished closing up her shop.
"They're our neighbors," Tran said. "Neighbors should help each other."