top of page

Market share shift of coffee shop brands in 2023

Vietnam's F&B market, in general, and Coffee shop market in particular, had remarkable growth in 2023. By the end of 2023, the dine-in market was estimated to reach VND 538.5 trillion ($21.6 billion), an increase of 10.87% compared to 2022. In particular, coffee shop market revenue was estimated at $1.46 billion, an increase of 13.3% (in VND). 

According to a recent survey, Vietnamese consumers increased their spending on dining out by 5-10%. In fact, 14.9% of customers were willing to spend more than VND 100,000 (US$4) on daily dinner, which was 3.5 times higher than in 2022.

At the same time, Vietnamese spending on coffee also increased slightly, with 59.5% of customers willing to spend more than VND 41,000 ($1.6) on this activity. Of those surveyed, 42.6% chose to go out once or twice a month, 30.4% went out once or twice a week, an increase of almost 8% from 2022, and 6.1% of respondents went out daily.

With the advantage of large population size, young population structure, and per capita income in urban areas is continuously increasing, along with the coffee-drinking culture of Vietnamese, the growth potential of the coffee shop market is always highly appreciated.

However, because of that attraction, the coffee shop market always attracts many businesses and witnesses the expansion of chain models of many new and existing brands. This creates fierce but also very exciting competition in the beverage chain market in general and the coffee chain market in particular in Vietnam.

If the period before 2020 was the period that witnessed the entry of many new chain brands, then the past two years were the period when the top brands consolidated their position and increased market share. Specifically, in 2021, brands including Trung Nguyen Legend, Highland Coffee, Phuc Long Coffee & Tea House, The Coffee House, Starbucks... accounted for about 33% of the coffee store business market share in Vietnam. The remaining piece of pie was small chain brands (Guta, Passio, Coffee Cong, Milano, Effoc, Gemini, Napoli Coffee...), and family-sized shops.

By the end of 2023, according to Vietdata's estimates, the market share of the five giants in the industry climbed to 42%. Of these, the main increase belonged to Highland Coffee (from 7.4% to 11.6%) and Phuc Long Coffee & Tea House (from 2% to 4.38%), Starbucks (2.38% to 3,79%). And over the past year, the whole market had about 143 new stores (belonging to chains) opened.

However, the notable point is that although sales were increasing rapidly, chains' profits tended to narrow in 2023, in the context of fierce market competition. Chains "race each other" to run promotional programs to maintain loyal customers, many chains did not increase prices, while coffee prices (input materials) increased sharply.

Below are some numbers reviewing the business activities of the chains.

Trung Nguyen Legend 

In 2023 - 2024, Trung Nguyen Legend has continued to expand its existing strategic distribution network in all provinces and cities in the billion-dollar Chinese market. However, in Vietnam, the number of the brand's stores not only does not increase but tends to narrow and cut ineffective stores/shops, to only about 600 stores, including 480 stores of Trung Nguyen E-Coffee and 116 stores of Trung Nguyen Legend Café.

In 2023, Trung Nguyen Legend still maintained revenue growth and maintained its position in the coffee shop business market. This brand continued to be the leader in Vietnam, accounting for about 20% of the market share in revenue. However, the investment in market expansion costs in China led to a continuous decrease in profits over the past two years.

Highlands Coffee

Highlands Coffee had a strong comeback after the Covid-19 pandemic (2021). Highlands Coffee's revenue reached a record level of nearly VND 4,000 billion, holding 12% of the market share of the billion VND "piece of pie". The brand has continued to strengthen its position as the largest franchised coffee chain in Vietnam, with 777 stores currently operating in many provinces and cities across the country (as of May 2024). Highland Coffee attracts customers thanks to the specialty location of its stores, design style, space requirements (when franchising), coffee flavor and drink recipes suitable for many audiences, and especially prices and promotions.

Phuc Long Coffee & Tea

After closing ineffective WinMart+ kiosks, Phuc Long Coffee & Tea changed its strategy and focused on opening 30 to 60 new coffee stores outside the WinCommerce system in strategic cities such as Hanoi and Ho Chi Minh City. As of June 15, Phuc Long had 158 flagship stores and about 119 integrated kiosks at Winmart/Winmart+ stores.

After the famous merger of Phuc Long and Masan Group (2021 - 2022), this brand's revenue was recorded to increase 3.5 times but stagnated at VND 1,500 billion in 2023, market share decreased compared to 2022 reaching 4.52%. Although Phuc Long's revenue increased rapidly after the deal, profits continuously decreased for two years, falling below VND 30 billion in 2023.

Starbucks Vietnam

Faced with the failure of foreign coffee chains in the Vietnamese market, Starbucks has applied market expansion strategies carefully and per the coffee-drinking culture of Vietnamese. Over the past two years, Starbucks Vietnam has implemented a strategy to expand points of sale, from 78 stores (June 2022) to 110 stores today. Thanks to that, revenue also increased rapidly, 87% in 2022 and 28% in 2023, respectively, to more than VND 1,300 billion. Thus, after 11 years of operation in Vietnam, the brand has captured a relatively large market share, reaching about 4% market share in terms of revenue. 

However, like other brands, Starbucks Vietnam's after-tax profit in 2023 also shrank due to being affected by fluctuations in input raw material prices, and the profit margin of new points of sale was still low.

The Coffee House

The Coffee House surprised the market in 2024 when it was "outmatched" by the "big giants". Market share decreased compared to 2022 and returned to near the level of 2021 (2.02%). The number of stores of this brand decreased to 129 stores (updated as of June 15, 2024) (compared to 157 stores on February 5, 2023).

The Coffee House's revenue recorded a trend of continuous fluctuations in the period 2021 - 2023. Specifically, in 2021, the brand's revenue increased sharply by 67% in 2022, but decreased by 11% and reached VND 700 billion in 2023. And in terms of efficiency, this brand has continued to record accumulated losses.

Katinat Coffee & Tea House

Katinat Saigon Kafe (referred to as Katinat) is a "late-born" brand compared to many coffee chain brands on the market but has grown quite impressively. Just launched in 2020, Katinat now has a 1.35% market share of the entire market, with 2023 revenue reaching nearly VND 470 billion. 

At the end of 2021, Katinat was just a small coffee chain with about 10 stores in Ho Chi Minh City. However, with the speed of market expansion, especially in prime locations in the center, Katinat has conquered the tea-coffee market in Vietnam, and gradually "threatened" the "big giants" in the industry.

In April 2024, Katinat Saigon Kafe repositioned its brand into Katinat Coffee & Tea House and implemented a new development strategy, focusing on two main product lines: Tea and Coffee. Currently, Katinat Coffee & Tea House owns a total of 73 stores in many provinces and cities nationwide (Ho Chi Minh City has the largest number of stores). 

Ong Bau Coffee, GUTA Cafe, Cong Caphe

After the above-mentioned 'big giants', some franchised coffee chain brands such as Ong Bau Coffee, GUTA Cafe, Cong Caphe, Milano, Napoli, or E-Coffee (Trung Nguyen) belong to the same segment (in terms of price, and scale store area model and brand positioning...).

The revenue scale of brands in this "street coffee" segment ranges from VND 15 billion to around VND 50 billion despite being established for many years. And the profits of brands in this segment are also very modest. 

Specifically, for Cong Caphe, after more than 17 years of development, the brand has a total of 64 stores across Vietnam, but revenue was only at VND 15 billion (2023). And this revenue level has increased by 44% over the same period in 2022. 

As for GUTA Cafe, established in 2011, this chain has now developed more than 100 points of sale throughout the Ho Chi Minh City area. GUTA Cafe's 2023 revenue was estimated to reach more than VND 35 billion, a slight increase of 7% over the same period last year. 

As for Ong Bau Coffee, although with a scale of 173 stores stretching from North to South, and a sales scale that is somewhat superior to GUTA Cafe and Cong Ca Phe; but this chain brand is gradually losing its position in the market. The 2023 revenue of the Ong Bau Coffee chain was recorded to reach the lowest level in the past three years (2021 - 2023), reaching about VND 50 billion, down 45% compared to the same period in 2022. This brand has also continuously recorded losses, although the annual loss has gradually decreased.

Source: Vietdata's 2023 Coffee Shop Chains Market Report


bottom of page