This report serves as a practical guide for U.S. exporters wishing to initiate or increase exports of U.S. consumer-oriented agricultural products (fresh or processed animal & plant products; beverages; other snack foods) to Vietnam.
THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY
USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT
Required Report - public distribution
GAIN Report Number: VM1054
Many Opportunities for U.S. Food and Agricultural
Products, but Also Some Risks
R. Justin Taylor
Bui Thi Huong, Truong Minh Dao, Julie MacCartee and Ryan Boone
This report serves as a practical guide for U.S. exporters wishing to initiate or increase exports of U.S. consumer-oriented
agricultural products (fresh or processed animal & plant products; beverages; other snack foods) to Vietnam. It provides key
updates on Vietnam?s policies and regulations that may affect exporters? choices about how to approach this dynamic
market. Although Vietnam?s maze of regulations has occasionally resulted in troublesome trade barriers, the country is
making progress in reducing import tariffs per its WTO obligations and adopting more business-friendly practices.
This report serves as a practical guide for U.S. exporters wishing to initiate or increase exports of U.S. consumer-oriented
agricultural products (fresh or processed animal & plant products; beverages; other snack foods) to Vietnam. It provides key
updates on Vietnam?s policies and regulations that may affect exporters? choices about how to approach this dynamic
market. Although Vietnam?s maze of regulations has occasionally resulted in troublesome trade barriers, the country is
making progress in reducing import tariffs per its WTO obligations and adopting more business-friendly practices.
A number of factors have spurred a tremendous increase in Vietnam?s food imports over the last five years; these include
steady population growth, strong economic growth, greater disposable income, and expansion in the retail, food service, and
food processing sectors. Vietnam?s food and beverage import sector was relatively insulated from the global economic
recession of 2008-09, and total imports continued to climb in 2010.
In particular, U.S. exports of consumer-oriented agricultural products to Vietnam have grown at an astonishing rate in recent
years. From 2004 to 2010, the year-end figure increased over 1,000 percent. In 2010, the United States exported a record
$535 million in consumer-oriented agricultural products to Vietnam, vaulting the country to 15th on the list of U.S. export
markets for this sector. Overall, prospects for continued growth in Vietnam?s food import market remain strong.
This report was prepared by the Office of Agricultural Affairs of the USDA/Foreign Agricultural Service in Hanoi and Ho
Chi Minh City, Vietnam for U.S. exporters of domestic food and agricultural products. While every possible care was taken
in the preparation of this report, information provided may not be completely accurate either because policies have changed
since its preparation or because clear and consistent information about these policies was not available. It is highly
recommended that U.S. exporters verify the full set of import requirements with their foreign customers, who are normally
best equipped to research such matters with local authorities, before any goods are shipped. FINAL IMPORT APPROVAL
OF ANY PRODUCT IS SUBJECT TO THE IMPORTING COUNTRY'S RULES AND REGULATIONS AS
INTERPRETED BY BORDER OFFICIALS AT THE TIME OF PRODUCT ENTRY.
Section I. Market Overview:
This report provides U.S. exporters with basic information on exporting high-value consumer-oriented foods and beverages
Vietnam has a dynamic, young and educated population of nearly 90 million consumers and currently enjoys one of the
highest annual GDP growth rates in Asia. From 2001 to 2008, the economy grew at an average rate of more than 7 percent
per year, second only to China. Though it slowed to 5.3 percent in 2009 due to the global economic recession, it reached 6.5
percent in 2010 (Source: Vietnam Statistics Office). The retail and tourism sectors have outpaced the general economy in
recent years, boasting an annual growth rate of 10 percent. These economic growth trends should continue for the
foreseeable future. Therefore, the outlook for sales of high-value food and beverage products is excellent.
Despite this amazing growth, doing business in Vietnam can be a challenge for exporters. At times, the maze of seemingly
conflicting regulations may present a formidable barrier to trade, yet at the same time, the country is evolving and becoming
more business-friendly in other respects. The improved economic environment owes much to Vietnam?s integration into the
global trade community. Vietnam is an active member of ASEAN and became the 150th member of the World Trade
Organization (WTO) in January 2007. The Government has recently concluded negotiations for Free Trade Agreements
(FTAs) with many important trading partners, including ASEAN, ASEAN-China, ASEAN-Korea, ASEAN-Japan, ASEAN-
New Zealand-Australia, and ASEAN-India. Through these efforts, Vietnam has pledged not just to lower import tariffs and
eliminate quotas, but also to increase market access for goods and services, strengthen IPR protection, enhance legislative
and regulatory transparency, and improve its commercial dispute settlement and trade facilitation processes.
In 2009, the foreign trade segment of the Vietnamese economy was negatively impacted by the global economic recession.
The total export and import trade value reached only $125.4 billion, a year-on-year decrease of 12.5 percent. Total exports
were valued at $56.6 billion, a reduction of 10 percent over 2008, and imports were valued at $68.8 billion, a decrease of
14.7 percent over 2008. However, in 2010 a remarkable improvement occurred and exports and imports both expanded
dramatically reaching $71.6 billion (a year-to-year increase of 26.5 percent) and $84 billion (a year-to-year increase of
22.1percent), respectively (Source: Vietnam General Statistics Office).
Tourism and remittance income are vital sources of foreign currency for Vietnam. In 2009, remittance income contributed
about $6.6 billion to the economy, while tourism contributed a further $3.7 billion. Tourists are a driving force in the demand
for imported high-value food products, particularly from the hotel and restaurant industry. After growing at an annual
average rate of 10 percent for many years, the number of international tourists fell in 2009 but bounced back in 2010 and
reached over 5 million (a year-to-year increase of 30 percent and a new record).
The market for high-value food products is substantial and is growing across a wide variety of categories. Unofficial trade
data indicate that Vietnam imported over $1.15 billion in consumer-oriented agricultural products in 2009, this includes $250
million in edible fishery products which was the single largest category. Total 2009 imports in agricultural, fish and forestry
products are estimated at $7 billion. (Note: Given Vietnam?s porous borders and endemic under-invoicing, it is difficult to
estimate the actual level of consumer-ready imports.)
U.S. food products are favored by consumers for their high quality, safety, innovation and consistent supply. Exports of high
value and consumer-oriented U.S. agricultural and food products to Vietnam have seen rapid growth in recent years. After
hovering around the $20 million mark for several years in the early 2000s, these exports grew to $408 million in 2008. They
dropped to $394 million in 2009 due to the global economic crisis, but rebounded to an astonishing $535 million in 2010. In
the coming years, these exports should continue to increase.
FAS Vietnam?s best prospects for consumer-oriented agricultural products include dairy products, chilled and frozen meat
(beef & pork), frozen poultry, fresh fruits, dried fruits and nuts, snack foods, confectionary foods, packaged foods (canned
fruit & vegetables, canned meat), condiments, juices, and alcoholic drinks (wine, beer, spirits). See Section IV: Best High-
Value Product Prospects for more information on the outlook for each of these products.
Vietnam?s retail food sector is growing rapidly, fueled by a combination of strong economic growth, rising income levels
(particularly disposable income), a large young population, a growing middle class, and increasing exposure to a Western
lifestyle. More and more urban consumers are opting for an international shopping experience, shifting from the traditional
?wet? markets to supermarkets and shopping malls. This trend has been a driving force in increasing imports of Western
food products. See Section III: Market Sector Structure and Trends for more information on the retail, food processing, and
food service sectors.
Still, there are obstacles to increasing the U.S. market share. It often seems that U.S. suppliers are either unfamiliar with the
market or are unable to evaluate a potential importer. In addition, for some products, the small order size (typically case-lots,
not container loads or consolidated container loads) is a disincentive to target this market; thus, many U.S. products are
transshipped through Hong Kong or Singapore, which adds handling costs and increases delivery times. However, current
marketing efforts have the potential to pay large dividends down the road as Vietnam?s economy continues to grow.
Vietnam?s best consumer years are still ahead and prospects are very promising for faster expansion of the retail, food
processing, and food service sectors in the next five years. The Agricultural Affairs offices in Hanoi and Ho Chi Minh City
(HCMC) are ready to assist you in fine-tuning your export activities for Vietnam.
Table 1: Advantages and Challenges for U.S. Exporters
Advantages of Exporting to Vietnam Challenges for U.S. Exporters
Increasing incomes and a rapidly-growing middle Strong preference for European (esp. French) and
class enamored with American culture (food, music, NZ/Australian foods due to 20-year U.S. absence from the
movies, fashion). market.
U.S. foods are recognized as high quality items and Consumers are very price-sensitive. Vietnamese urban
great value for the price. dwellers are slow to try new types of Western food.
Low level of competition from other U.S suppliers in Significantly higher shipping costs and transportation time
the market. than Asia and Oceania.
Vietnam?s accession to WTO in 2007 has helped High tariffs, cumbersome and excessive customs
reduce tariffs on several food items and created a requirements, and non-science-based sanitary and
better business environment with more liberalized phytosanitary requirements on animal and plant products
trading and service practices. persist, and the regulations are slow to change.
Voluntary tariff reduction on dairy products, corn, Low tariffs applied on food products imported from South
soybeans, and soybean meal, even beyond final bound East Asian (ASEAN) Countries; China, New Zealand and
rates. Australia under Free Trade Agreements.
Growing number of Western-style fast food restaurant U.S. exporters often are not flexible enough or responsive to
chains, bakeries, and coffee shops. Franchising has importers? needs or the local business environment.
been introduced and the retail food sector is
transitioning to a more modern structure.
Growing rural-to-urban migration. Limited infrastructure and distribution for perishable products.
USDA Guarantee Export Credit Program (GSM 102) Limited/restricted supply of bank loans and foreign exchange
has been available for use in Vietnam since 2008. So as well as weaker ties between the U.S. dollar and the
far, six Vietnamese commercial banks have been Vietnamese dong, resulting in more risk for non L/C payment
eligible under the program. terms for sales of U.S. foods.
We encourage you to assess market prospects first-hand. Face-to-face contact is very important to the Vietnamese,
particularly in the initial stages of business relationships. Our HCMC office organizes a U.S. Pavilion at Vietnam?s
international food show, Food & Hotel Vietnam (FHV) (www.foodnhotelvietnam.com), held bi-annually in HCMC. The
next FHV is 28-30 September, 2011. Regional shows are held in Hong Kong (HOFEX, often held in May) and Singapore
(Food and Hotel Asia (FHA)), approximately every two years. Many leading Vietnamese firms attend all three of these trade
Reports on Food and Agricultural Import Regulation and Standards (FAIRS)
The Exporter Guide should be used in conjunction with our other commodity reports, especially the Food and Agricultural
Import Regulations and Standards (FAIRS) reports: VM8057 (FAIRS); VM7070 (FAIRS Export Certificate); VM8055
(Maximum Residue Levels), and VM 9078 (FAIRS). Despite our efforts to update all reports, some of the information will
quickly become dated. Please contact the Hanoi and HCMC offices for the most up-to-date information. The next FAIRS
reports will be published in the fall of 2011.
Section II. Exporter Business Tips:
Below are some of the most important points to understand about doing business in Vietnam, from a U.S. agricultural
exporter?s point of view. Please see the list of resources at the end of this report for additional sources that can enhance your
understanding of Vietnam?s business and food policy practices.
(1) Local Business Customs and Market Entry Strategy
Most local businesses are small or medium-sized companies that rely on bank loans to run their business, with loan sizes
varying according to collateral. The following local customs and habits are important to take into account. Vietnamese
Prefer face-to-face meetings in the initial stages, with additional follow-up visits, phone calls, emails, and faxes.
Initial face-to-face meetings without follow-up visits rarely result in sales. Sending offers and quotations without
first establishing a relationship (cold calls) is highly unlikely to result in sales.
Can be very slow to respond to emails.
Sometimes complain that U.S. suppliers do not make enough of an effort to understand their particular needs and
May exhibit strong interest at the outset of business discussions and then start to lose interest when faced with
difficulties in implementing the details.
Tend to be more sensitive about price than quality, but this is beginning to change in some sectors.
Tend not to pay close enough attention to trade policies and import regulations. When import regulations change,
they often do not have accurate information about the changes, which results in misinterpretation of those changes.
For more accurate information, always refer to FAS trade reports and/or check with the local FAS office.
Quite often seek exclusive import and distribution rights, deferred payment terms (always risky), and large
marketing budgets on new deals and new-to-market products.
Companies that specialize in food import and distribution may have investments in other types of businesses (e.g.
real estate, car dealership etc.). In certain cases, the food business may receive less attention, particularly in areas
such as checking and responding to emails in a timely manner. Given this divided focus, such firms may be less
engaged or focus more on the business with the better return and could discontinue areas of their enterprise that are
not doing well without notice or explanation.
U.S. exporters should note that Vietnam?s legal and regulatory environment is undergoing fairly constant change. Ongoing
efforts to implement WTO mandates are stimulating change in public sector transparency and trade liberalization, even
though import procedures remain inconsistent and still quite bureaucratic.
On January 01, 2009, as part of commitments made upon joining WTO, Vietnam officially opened up trading rights and
distribution rights to foreign players. Since that date, foreign players are able to operate in their trading and distribution
business including retail business under 100 percent foreign-owned entities. However, FAS Vietnam has not seen a flood of
new market entrants. This could be a result of the fact that the Government of Vietnam still gets to determine whether there
is ?the economic need? for additional outlets beyond the one that is initially opened by the 100 percent foreign-owned entity.
Local importers continue to play a major role in distributing and promoting imported products in Vietnam. Typically, local
importers have their own sales agents and distribution fleet and are in direct contact with supermarkets, wholesalers, and in
many cases, also with thousands of grocery stores. Some importers import a wide range of products with no particular
loyalty to a specific product, brand or origin. Others are working exclusively to develop markets for specific labels. The
latter tend to promote their products more heavily and may require more involvement from the exporter in order to penetrate
It is critical for U.S. exporters to study the market potential for their products before initiating sales. They should also visit
Vietnam to gain a first-hand feel of the market, preferably around the time of the bi-annual Food & Hotel Show in Ho Chi
Minh City (next show in September 2011). U.S. exporters are encouraged to review the FAS exporter guide as well as trade
policy reports before visiting. Exporters may also contact the FAS offices in Hanoi or Ho Chi Minh City for assistance in
setting up initial meetings with potential importers and major retailers.
The first objective of U.S. exporters new to the Vietnam market should be to gather information about potential buyers
(Contact FAS Vietnam for lists of potential importers). A business trip should be scheduled to maximize business contacts
in a minimal amount of time. The initial trip to Vietnam will likely include multiple business meetings each day to identify
potential buyers. To the extent possible, these meetings should not seem hurried. During this visit, it is important to reserve
time to briefly meet with each company a second time. Additional meetings over coffee or lunch/dinner in the city center are
the best approach for making successful business contacts. Although the meetings will probably be conducted in English, it
is always best to have an interpreter on hand to make sure that everyone completely understands the terms of the agreement.
What may sound simple and clear to you may not be so simple and clear in Vietnamese, or in the Vietnamese business
context. Any verbal agreement should be quickly followed up with a written agreement.
U.S. exporters should perform adequate due diligence on potential customers to ascertain if they have the requisite permits
and capital resources to meet their responsibilities. Success in introducing your product in this market depends on a good
local representative and an effective pricing strategy. The local partner should preferably be an importer and distributor,
capable of maneuvering in both traditional and modern retail channels.
(2) Consumer Preferences
Vietnam?s consumer market is still in the early stages of development but has been one of fastest growing markets in
Southeast Asia due to a youthful population, continuing strong economic growth, and rising disposable income.
Vietnamese consumers dispense a sizeable portion of their income on food items. More than half of total expenditures are
for food, mostly basic food items like rice, salt, sugar, meat, vegetable oil, and sauces. The average household spends very
little on high-value processed food products. Nevertheless, recent consumer surveys point to an increase in spending on
high-value foods such as dairy products (UHT and fresh milk, yogurt, cheese etc.) meats, eggs, fresh fruits, imported
vegetables, confectionary, snack foods, and packaged food items.
Vietnamese consumer habits:
Shop daily for food items. (This is changing somewhat among the younger urban generation)
Prefer fresh products, especially for red meats, poultry meat and seafood. (However, frozen foods are
gaining popularity because more and more consumers in urban areas believe them to be more hygienic.)
Low ownership rate for refrigerators and microwave ovens. (Only 12% of urban households have
Consumer trends in urban areas:
Low (but increasing) average income.
Growing awareness and concern about nutrition, quality, hygiene, and food safety. (Clear indication of
nutritional value on the package has been a good marketing strategy for health foods.)
Brand loyalty; still receptive to new products.
Western lifestyle is welcomed.
Dining out has become more frequent.
Advertisements and promotions are effective, particularly for children.
(3) Food Standards and Regulations
Please refer to FAIRS report VM 9078 for detailed information about Vietnam Food Standards and Regulations. Also refer
to VM8055 for the "Permitted Maximum Levels of Biological/ Chemical Residues in Food" (MRLs).
(*) Special note on Food Quality/Standards Registration
Locally produced and imported foodstuffs must obtain a Food Quality/Standards Registration Certificate (RC). The Vietnam
Food Administration (VFA) of the Ministry of Health (MOH) is responsible for issuing these certificates for imported foods.
Details can be found in FAIRS Report VM9078 under ?Food Quality/Standards Registration.?
This registration process is cumbersome. The Ministry of Health imposes excessive documentation requirements with respect
to imported food products. Importers are required to apply for registration for each food item imported. Also, the
documentation needed to register food products can be excessive. The process requires a certificate of analysis (CA) so
detailed that some U.S. companies are unwilling to provide it because they feel it violates their confidentiality. For mixed
containers of processed foods, the requirements can be both costly and burdensome.
(4) Trading and Distribution Rights
In accordance with Vietnam?s WTO commitments, as of January 1, 2009, foreign-owned firms in Vietnam are allowed
distribution rights. However, FAS Vietnam has not seen many distribution rights being granted to foreign entities. In the
meantime, U.S. businesses should continue to work with and through local importers/distributors. Quite often the importer
and distributor are separate companies, each with its own required fees.
In general, Vietnamese companies that are licensed as food and foodstuff businesses and issued import/export customs codes
are eligible to import and distribute food products within Vietnam. In some cases, the importer is a state-owned enterprise
(SOE) that is able to obtain foreign currency financing from state-owned banks to purchase goods; such SOEs usually charge
a small fee for importing goods on behalf of private-sector Vietnamese distributors. The goods will then move to market
through the local distribution company. In many cases, however, the local privately-owned company has the proper import
and distribution licenses and the SOE does not need to be involved. This is usually a better choice for U.S. companies trying
to find local partners.
(5) Representative Offices
Foreign companies can enter Vietnam and establish a Representative Office. This type of office requires a business license
issued by the Ministry of Industry and Trade and its city and provincial sub-departments and permits the foreign company to
monitor marketing and sales activities of the local or joint-venture distributor. It does not, however, give the foreign
company the right to manage the distributor, sell products, or collect payments.
Many international companies have established ?rep? offices in HCMC or Hanoi. This allows them to closely monitor and
work with their local partners, but does not allow them to directly trade or distribute goods. Vietnam has been slow to relax
the overly burdensome process for registering and operating a wholly owned office.
(6) Credit & Finance / Letters of Credit / USDA Export Credit Guarantee Program (GSM 102)
On any shipment exceeding a small sample amount, it is important to sell goods cash before delivery or against an
irrevocable Letter of Credit (L/C). Other credit terms should not be contemplated until you are absolutely sure the importers
and distributors are reliable. There have been many cases of local companies locked in payment disputes with their foreign
In normal practice between U.S. exporters and reliable importers, Vietnamese foodstuff importers usually make payment on
either Money Telex Transferred (TTR) or Document against Payment (DP) basis, as the banking fee for opening L/Cs is high
compared with relatively small U.S. dollar payments needed for importing small lots of U.S. goods.
It is important for the American exporter to have a distribution relationship with a local company that has the financing to
enter into a business relationship, both with the exporter and with local Vietnamese stores. The local distributor will give
credit terms to buyers and collect payments due.
USDA Export Credit Guarantee Program (GSM 102):
The GSM 102 Program provides credit guarantees to encourage commercial financing of U.S. agricultural commodity
exports, thereby assisting U.S. exporters in making sales that might not otherwise occur. The GSM-102 program guarantees
credit extended by the private banking sector in the United States (or, less commonly, by the U.S. exporter) to approved
foreign banks using dollar-denominated, irrevocable letters of credit for purchases of U.S. food and agricultural products by
foreign buyers. USDA?s Foreign Agricultural Service (FAS) administers the program on behalf of the Commodity Credit
Corporation (CCC), which issues the credit guarantees.
Potential benefits from the GSM 102 to importers include access to credit from the local bank; increased buying capacity
because of access to trade credit; longer repayment terms and lower cost of buying on credit; and ability to purchase more
U.S. agricultural products.
For more information about GSM 102, please visit: http://www.fas.usda.gov/excredits/exp-cred-guar-new.asp
Vietnam is eligible under the Southeast Asia regional program, which covers Cambodia, Indonesia, Laos, Malaysia, Papua
New Guinea, Philippines, Singapore, Thailand, Timor-Leste, and Vietnam.
FAS has currently approved the following seven banks in Vietnam to be eligible under the GSM 102:
Bank for Investment and Development of Vietnam (BIDV)
Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank)
Military Commercial Joint Stock Bank (MB Bank)
Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank)
Vietnam Bank for Agriculture and Rural Development (Agribank)
Vietnam Joint Stock Commercial Bank for Industry & Trade (VietinBank)
Vietnam Technological and Commercial Joint Stock Bank (Techcombank)
Vietnamese banks are currently eligible for a maximum tenor of up to 1 year.
Approved banks in Southeast Asia may issue L/Cs for sales to Vietnam and other regional destinations.
(7) Supermarket Tips & Cold Chain Woes
Supermarkets in Vietnam carry a wide range of goods, including food, clothing, shoes, and furniture. Most supermarkets
devote about 40-50 percent of their physical space to food; the rest is divided among other goods.
Increasingly, consumers are inclined to buy food from supermarkets because they are viewed as cleaner and more sanitary
than traditional markets. There is also a growing acceptance of processed, packaged, and frozen food products, including
meat and fish. Though local food products continue to be strong sellers because of a lower price, quality control has not yet
reached international standards. Local consumers are beginning to pay closer attention to food quality and food safety, and
this new trend will help promote U.S. quality products. Supermarket managers report that consumer demand for imported
foods is steadily increasing.
Modern retail stores still only account for 15% of total food sales to Vietnamese consumers, but sales through such outlets
have grown considerably over the last six years, with an annual average growth rate of 20 percent. One should not, however,
totally overlook the open-air or enclosed traditional markets, often referred to as ?wet? markets. Many case-lots of imported
goods (canned goods, nuts, wine, beer, and shelf-stable products) are sold through these markets, particularly in areas not yet
served by modern supermarkets. According to major U.S. food importers, sales volumes to supermarkets are increasing, but
are still under 50 percent of their total sales. To reach all Vietnamese consumers, exporters need to have a local partner
capable of supplying both the modern channel (department stores, wholesale outlets, hypermarkets, supermarkets,
convenience stores) and traditional channel (wet markets and ?mom and pop? shops).
The requirement for food quality registration to the Vietnam Food Administration (VFA) is a constraint for supermarket
chains to directly import U.S. foods and beverages. Because supermarket chains are usually interested in mixed containers of
many items of packaged foods, it is very costly and the paperwork is burdensome to register each food item with VFA.
The cold chain - the system for preserving fresh, chilled, and frozen commodities from producer to final consumer - is not
good in Vietnam, though it is improving. Most of the larger modern shops have freezers and refrigerators, but smaller shops
do not. While Vietnam has developed a fairly good export cold chain for frozen seafood, the import and domestic cold
chains are weaker and more prone to power interruptions. Fresh produce suppliers have also found that many Vietnamese
importers do not adequately supervise the temperature and humidity in their chillers, thereby shortening the shelf life of
Refrigerator and microwave ownership in Vietnamese homes is still low, though the numbers are growing among middle-
class consumers in urban areas such as Hanoi, HCMC, Hai Phong, Da Nang, and Can Tho.
(8) General Inspection Procedure for Imported Products (Entry Point Inspection/Testing)
Please refer to the part of ?Entry Point Inspection/Testing? of FAIRS report VM9078 for detailed information. Also refer to
VM8055 for the "Permitted Maximum Levels of Biological/ Chemical Residues in Food" (MRLs).
In brief, according to the latest regulation issued by Ministry of Health/Vietnam Food Administration, 12 foodstuff groups
(other than unprocessed food originating from animal, plants, and fish sources) are subject to compulsory State examination
on food quality and safety:
Food quality and safety control examinations for goods using Harmonized System code (HS) are based on Vietnamese
Standards (TCVN) and Technical Standards. In case there is no Vietnamese reference, CODEX standards are applied.
The entry point inspection entities are technically referred to as State Testing Agencies or State Controlled Agency (STA or
SCA) which carries out inspection and clearance related to quality control on behalf of all Government Ministries. The STA
or SCA normally concentrate on the MRLs for their testing.
(* NEW) - Automatic Import Permit (AIP) from Vietnam Ministry of Industry & Trade (MOIT)
On May 28, 2010, the Ministry of Industry and Trade (MOIT) published Circular 24, which requires local importers to
obtain an automatic import license (AIL) from the Government of Vietnam (GVN) before any shipment can unload at any
Vietnamese port. MOIT does not charge a fee for issuing the AIL. Circular 24 entered into force (EIF) on July 12, 2010.
Broad in scope, Circular 24 applies to select agricultural products from Chapters 2, 3, 16, 17, 18, 19, 20, 21, and 22 of the
Harmonized System. Key products include all meat and edible meat offal; live fish (except for breeding); fresh, frozen,
chilled, dried, salted or in brine, smoked, minced, and whole fish; crab; mollusks; processed meat (sausage); meat, fish,
crustacean, or mollusk extract or juices; caviar or caviar substitutes; confectionary items including sugar; chocolate or items
including cocoa; preparatory items for pastries; pastas; tapioca and its derivatives; cereal goods (corn flakes); breads,
pastries, cakes, and biscuits; extracts, essences, and concentrates of coffee or tea; sauces and seasonings; soups and broths;
ice cream and other edible ice; bottled water; beer; wine; vermouth; all fermented beverages; all spirits; and all vinegars.
In order to obtain the AIL, importers must send the following documents by mail to MOIT headquarters in Hanoi, or to the
MOIT Representative Office?s headquarters in Ho Chi Minh City: 1. A written application for registration (Appendix 2); 2.
The business registration certificate; 3. The import contract; 4. A commercial invoice; 5. A Letter of Credit or payment
document; and 6. A bill of lading.
Once this information is received by the respective MOIT office, they are supposed to issue the AIL within seven working
days. MOIT subsequently issued an addendum to Circular 24 (Official No: 6864/BCT-XNK) on July 13, 2010, waiving the
requirement for a bill of lading for air shipments of highly perishable food products (i.e. fresh seafood, chilled meat).
For more details on the Circular 24, please check the GAIN Report VM0049.
For imports of foods originating from animal, plant and marine sources
Imports of foods originating from animal, plants and marine sources must be inspected for sanitary and phytosanitary
standards by competent quarantine agencies under the Ministry of Agriculture and Rural Development (MARD).
At the wholesale/retail distribution level, several city and provincial government agencies are involved in monitoring the
quality and safety of food products, including offices of the Ministry of Health, the Department of Animal Health, the
Ministry of Industry and Trade, and the Police Force.
The General Department of Customs also inspects goods to determine and collect import duties and assess violations of
compliance with required Customs formalities on behalf of all concerned agencies (Ministry of Finance, Ministry of Industry
and Trade, Ministry of Health, Ministry of Agriculture, etc.).
(* NEW) Import requirement for foodstuffs of animal origin and aquatic origin:
According to MARD?s Circular 25/2010/TT-BNNPTNT dated April 3, 2010, as of July 01, 2010, for exports of foodstuffs of
animal origin and aquatic animal origin to Vietnam, all food business operators (FBOs), who produce these foods, are subject
to registration to the MARD/National Agro-Forestry and Fishery Quality Assurance Department (NAFIQAD). As of January
2011, NAFIQAD is continuing to post its Approved List of U.S. Meat and Poultry FBOs for export to Vietnam on their
website www.nafiqad.gov.vn. For a U.S. company to appear on this list it must fill out an Appendix 3 and submit it to FAS
Vietnam via e-mail or fax. Please see GAIN Report VM0048 for more details on Circular 25. If you would like to submit an
appendix 3 for your company, please contact FAS Vietnam directly (email@example.com; firstname.lastname@example.org ).
(* NEW) Standards for Maximum Residue Levels on Meat, Meat Products and Aquatic Products set by MARD
On May 6, 2010, Vietnam's Ministry of Agriculture and Rural Development (MARD) issued Circular 29/2010/TT-BNN
(Circular 29), establishing new Maximum Residue Levels (MRLs) for many meat, poultry, and seafood products. Circular
29 took effect July 1, 2010, and replaced part of the Ministry of Health?s (MOH) Decision 46/2007/QD-BYT (Decision 46;
see GAIN VM8055). Circular 29 affects some meat, poultry, and seafood products. The Circular applies to both
domestically produced and imported products. For more details about Circular 29, please see Gain Report VM0041.
(* NEW) Pest Risk Assessment Requirement for Imports of Fresh Fruits and Seeds:
According to MARD?s Decision 48/2007/QD-BNN dated May 29, 2007, for imports of seeds and fresh fruits into Vietnam,
these articles are subject to pest risk assessment (PRA) and required for obtaining phytosanitary import permits from the
MARD/ Plant Protection Department in Hanoi (PPD-Hanoi). Currently, Vietnam has only accepted imports of table grapes,
apples, cherries and pears from the USA. For other fresh fruits, especially new-to-market fruits, PRAs are requested to be
conducted by PPD, and it normally takes one year to three years to complete each PRA. If you have questions about the PRA
requirement from MARD, feel free to contact our office.
(9) Location of Inspection
Entry-point inspections by STAs and Customs inspections may take place at a seaport, river port, airport or even at a public
warehouse or importer?s warehouse?if it is certified and approved by STAs and Customs. If the importing company would
like to have cargo inspected in its warehouse, the company must submit a request to the Customs authorities and STAs for
For imports of meat and dairy products, locations of inspection must be at entry-point destinations (seaport, river port, and
airport) or at STA/Customs-certified warehouses. Entry-point inspections at importer's warehouses are no longer accepted.
(10) Import Duties & Fees
The total cost of import duties and inspection fees levied is calculated by the General Customs Department and the STA.
Vietnam is now working to implement GATT Article 7 and therefore generally uses transaction value for import duty
calculations with only a few exceptions.
On March 16, 2007 Vietnam issued Decree No.40/2007/ND-CP on ?regulation on the calculation of customs value for
imported/exported goods.? As stated in Article 7 of the Decree, the customs value for the calculation of import taxes will be
based on actual value that importers are required to pay directly or indirectly to the exporter that include:
Value of goods listed on the commercial invoice
Other payments that the importer already paid in advance that may not be stated on commercial invoice (e.g.
payment for insurance, deposits for purchasing goods, payment for third party as requested by the seller.)
Inspection fees are calculated based on the total retail value of the cargo inspected. The fee for food quality inspection is
0.1% of the retail value of the goods, but the total amount cannot be less than Vietnamese Dong (VND) 300,000 which is
Customs has developed a specific procedure that it believes combats fraud. Each year it issues an import value database,
based on a database of usual and historical import prices that it maintains. If enterprises declare prices lower than the
reference price, Customs consults with the firm. After consultation, if an indication of trade fraud is found, the case file is
forwarded for further investigation as per regulations. Within 15 days from the date of applying for customs clearance of the
case, the Customs office must inform the importer of the determined customs value for import duty. There is an appeal
process in place.
These procedures have drawn complaints from importers of U.S. agricultural products, particularly for meat cuts and high-
value food products. Importers complain that the price database are often based on general category of previous imports (i.e.
4-digit HS code) without reference to product specification or differentiation and are significantly inaccurate. Customs
officials are reluctant to stray from the reference-price valuations even when invoices have been clearly proven valid. After
numerous complaints from trading partners, the process appears to be improving, particularly for long-established importers.
(11) Document Package
When importing, all necessary documents must be compiled into one dossier and presented with a Vietnamese-language
translation of the sales and purchase contracts.
The necessary documents include:
1. Customs declaration application / Registration for inspection form
2. Copy of the trade contract or letter of credit (L/C)
3. Bill of Lading
5. Packing List (see note below)
6. Certificate of Origin (See note below).
7. Documents certifying the safety and quality of the foods (Export Certificates)
8. Certificate of free sales (* NEW - see more details in the below note)
(*) Special note on the new requirement of Certificate of Free Sales (CFS) on selected agricultural products:
According to MARD?s circular 63/2010/TT-BNN on Certificate of Free Sales dated November 01, 2010, 45 days from the
date of signing this circular, CFS is required for selected agricultural and food products including wood and GM-food
products, irradiated food products, and food products manufactured under special (advanced or novel) technology. A CFS
must be made in English and contain the following details:
Name of the CFS issuing agency (the issuer)
Its reference number
Date of issuance
Name of the certified product
Type or group of the certified product
Name and Address of the manufacturer of the product
Statement that the product is manufactured and freely sold on the country of manufacture
Full name, title and signature of the CFS issuing person and seal of the CFS issuer.
Note: Additional documents may be required, based on the nature of the shipment. If there is any doubt, please check with
your local business partners, our FAS offices and also MOH before finalizing the sales terms.
On August 30, 2006, Prime Minister Nguyen Tan Dung signed Decree No. 89/2006/ND-CP on goods labeling. This replaces
Prime Minister Decision No. 178/1999/QDTTg of August 30, 1999 that promulgated the Regulation on labeling of
domestically circulated and exported and imported goods, and Decision No. 95/2000/QD-TTg of August 15, 2000 that
provided adjustments and supplements to it. The new decree would normally have been effective in March 2007, six months
after publication in the Official Gazette, but due to a delay in issuing the implementing guidelines, it came into effect in
September 2007. (See VM7037 for details)
This ordinance applies to all types of circulated goods including imports and exports. Labeling is exempted for raw and
fresh foodstuffs, unpacked processed foodstuffs which are for sale directly to consumers.
The Ministry of Science and Technology (MOST) has been assigned the lead in creating the relevant regulations to
implement the ordinance. MOST is also responsible for monitoring implementation of the ordinance and handling
violations. The Vietnamese Directorate for Standards and Quality (STAMEQ) has been appointed as the key assisting
agency to MOST in management of goods labeling, and on April 6, 2007, the Ministry of Science and Technology issued
guidelines for its implementation (see VM7038).
Special note on the Vietnamese labeling requirement on Production date and Best If Used By Date:
Post has received several complaints from importers of consolidated packaged foods about the burdensome requirements for
importing U.S. packaged foods with production date and best if used by date in code. The STA normally does not accept the
code and may require decoding explanations on the production and best by dates of products. The explanation should be
provided by either an independent government agency or the food manufacturer, not the shippers.
The production and best-by dates are also required for imported, chilled and frozen beef, pork poultry and offal. As most
U.S. meat exports to Vietnam have only production dates on the meat packages and no best-if-used-by dates, this creates
more difficulty for entry point inspections. It would be best to attach a meat packer?s letter to the shipping documents stating
that the best-by date of the meat is 18 months from the production/packing date, on the conditions of proper handling and
The draft implementing regulation for Vietnam?s new Food Safety Law emphasizes that ?Best Before? stamps may be used
where appropriate on non-perishable food products and that products past their ?Best Before? date are no longer at risk of
(16) Phytosanitary and Sanitary Inspection & Required Export Certificates
Please refer to the most updated FAIRS Export Certificate Report (VM1052 from July 18, 2011) for information on export
certificates and documents that Vietnam requires for imports of foodstuff, animal, plant and fishery products.
Vietnam is relatively reasonable on sanitary and phytosanitary issues, especially compared to most of its Asian neighbors.
Officials from the Ministry of Agricultural and Rural Development (MARD) have been responsive to appeals to follow OIE
guidelines. Still, Vietnam?s animal health officials are cognizant of their power and the tendency of other countries to go
beyond international guidelines like OIE.
Phytosanitary and sanitary health inspections for imports of animals and animal products (incl. dairy products), plants and
plant products, and edible fishery products must be done before customs clearance. The Ministry of Agriculture and Rural
Development?s Plant Protection Department (PPD) and Department of Animal Health (DAH) handle all sanitary and
phytosanitary inspections for these products.
Special Note: Regarding animal health inspection service, DAH requires:
Application dossiers for import of animal products for human consumption (meat, offal, eggs, milk and products containing
these ingredients) must include:
a. A letter requesting quarantine inspection of imports of animal products
b. Trading/Business License
c. HACCP certificate from food producing agencies (*)
(Note: for dairy products from the United States, Post is still working with DAH on a uniform HACCP certificate
for dairy products. In the meantime, the USDA/AMS certificate can be used to replace the HACCP certificate.)
d. Certificate of free sale (a copy with the company?s stamp)
e. Other permission granted by authorized agencies in accordance with the regulations.
(*) Effective August 4, 2006, MARD/DAH eliminated HACCP and Certificate of Free Sale from their requirement for
dossier for inspection permits to import of beef, pork and poultry meat from the United States.
Vietnam?s New Food Safety Law
On June 17, 2010, the Government of Vietnam (GVN) passed a sweeping Law on Food Safety (No.55/QH12/2010),
scheduled to enter into force on July 1, 2011. On March 8, 2011, the GVN released a draft implementing regulation (DIR)
for the food safety law, which was notified to the WTO for comment. However, several subsequent drafts of the DIR have
been published, each making significant changes to the previous version, and no single draft has yet been put forth for a
vote. The Food Safety Law requires that exporters declare conformity with Vietnam?s food safety standards or obtain a
?Certificate of Eligible Conditions for Food Safety.?
(17) Special Warning regarding Certificates of Origin and Packing List
According to Circular No.09/2000/TTLT-BTA-TCHQ dated April 17, 2000, Certificates of Origin (C/O) must be issued by
competent agencies as prescribed by the exporting country. These agencies usually include organizations such as the
Ministries of Trade, Ministries of Industry, Ministries of Finance, and other organizations designated by the government of
the exporting country, such as Chambers of Commerce, Chambers of Commerce and Industry, etc. If the C/O is issued by
the manufacturer, it must be certified by the concerned competent agency or organization of the issuing country.
C/Os submitted to Vietnam?s customs office must be original (not copies) and contain the following information:
1. The issuance number of the C/O.
2. Name and Address of the exporter, the exporting country.
3. Name and Address of importer, the importing country.
4. Information on transportation of the goods.
5. The trademark and label; quantity and type of packs; description of goods.
7. The origin of the goods
8. The enterprise requesting the C/O issuance (Enterprise?s name and date of request for issuance).
9. The C/O issuing organization (Name, date of issuance and its stamp)
(18) Certificate of Origin Stamp
Although Customs seems to be becoming more reasonable on this point, FAS/Vietnam has assisted with many cases in the
past where Customs officials refused to accept U.S. certificates of origin without ?raised? seals or official circular stamps. If
the C/O has an oblong or rectangular stamp, Customs may reject the document. Only circular stamps are considered official
in Vietnam. Additionally, many U.S. bodies issuing certificates of origin do not clearly stamp the paperwork. If Customs
cannot read the stamp, it does no good. Likewise, if the stamp is one that produces a ?raised? seal, please make sure it is
clear. FAS/Vietnam has developed a good working relationship with Customs officials, so do notify us if you encounter any
problems with certificates of origin.
Vietnam assumes the C/O will be issued by a ?relevant? body observing all applicable regulations of the country granting the
C/O. By ?relevant? body, Vietnam means a Ministry of Trade, Industry or Finance, and/or other organization authorized by
the State, such as a Chamber of Commerce or Chamber of Trade. In cases where the C/O is issued by the manufacturer (or
on the letterhead of the manufacturer), it should be certified (and stamped) by the relevant organization or body in the
country of origin.
(19) Import Quotas
On March 13, 2011, Ministry of Agricultural and Rural Development (MARD) issued Circular 13/2011/TT-BNNPTNT
regarding Guidance on Food Safety Inspection of Plant Origin Products.
Effective from July 1st, 2011, Circular 13 stipulates that plant origin products imported to Vietnam must come from an
approved plant product exporting country. To be eligible to export plant origin products to Vietnam, exporting countries
need to submit the information requested in Appendix 2 (Information on Organizing System, and Capacity of Authorized
Agencies to Control Food Safety of Plant Origin Products in Exporting Country), Appendix 3 (List of Pesticides, Chemicals
Used During Production, Preservation of Plant Origin Products in Exporting Country and in Item 3, Article 10 of Chapter II
(Annually updated food safety monitoring program of the exporting country applicable for goods during domestic
production, circulation and export). The U.S. has already been approved for exports of plant origin products to Vietnam.
Importers of plant origin products to Vietnam must register for Food Safety Inspection and ?standard quality conformity? in
addition to submitting information on plant quarantine. Plant Protection Department (PPD) of MARD is the state agency
assigned to do both plant quarantine and food safety inspection of plant origin products.
On December 31, 2010 Ministry of Industry and Trade (MOIT) issued Circular 45/2010/TT-BCT to announce import quota
set for 2011. The Circular is effective from January 1, 2011 until December 31, 2011.
The details are provided in the below table.
Table 2: 2011 Product Quotas Under MOIT Circular 45
HS Code Products Unit Quantity
04070091 Chicken eggs
1 04070092 Duck eggs Dozen 38,000
2 2401 Material tobacco Metric ton 38,000
3 2501 Salt Metric ton 102,000
4 1701 Refined/raw sugar Metric ton 250,000
(20) Imports of GM food and GM products
On June 21, 2010 the Prime Minister approved Vietnam?s Bio-Safety Decree 69/2010/ND-CP that replaces the first Vietnam
Bio Safety Regulation approved in 2005 (see VM5062). The new Bio-Safety Decree provides a legal frame work for bio-
safety management of genetically modified (GM) organisms, genetic specimen and products derived from GMOs. This
Decree does not regulate pharmaceutical products originating from GMOs. The Decree took effect on August 10, 2010.
(21) Enforcement Concerns
Traders have noted that enforcement of import regulations is not completely consistent. Moreover, the laws and rates of
duties change often and are almost impossible to predict. People working in the trade in Vietnam are often the best source
for finding the most up-to-date information about exporting food to Vietnam. Vietnamese government agencies can provide
information, but response time may be slow and miscommunication between ministry and regional offices is possible.
Contacting the USDA/FAS Agricultural Affairs Office in HCMC or Hanoi is a good starting point.
Section III. Market Sector Structure and Trends:
With a large, young consumer base, an improving per capita income and strong economic growth, Vietnam?s best consumer
years are still ahead and prospects for faster expansion of the retail, food service and food processing sectors in the next few
years are very promising.
The best way to enter the Vietnamese market is to develop a relationship with one of the established food trading and
distribution companies who are able to extend the distribution network to not only supermarkets, hotels and restaurants, but
also wet/open-air markets and ?mom and pop? retail shops. Currently, there are only a handful of well-organized food
trading and/or distribution companies in Vietnam; so the selection process does not take too long. There is typically some
sort of foreign involvement in each of the better-known companies. As these companies tend to be somewhat transient, it is
advisable to visit Vietnam and research the company?s customer lists and achievements.
Most chefs and hotel food and beverage managers in the top hotels in Vietnam are from Australia or Europe, so the HRI
sector has a strong preference for products from these countries. Australian products also enjoy advantages from lower tariff
rates due to the ASEAN-New Zealand and Australia FTA, shorter delivery time, and cheaper freight. U.S. products tend to
be newer to the market, which may or may not be an advantage depending on consumer knowledge of how to use the
product. In-store promotions are popular and are a recommended part of an advertising campaign. Point of purchase (POP)
displays and other advertising materials are important to attract local consumers that may have a limited knowledge of
foreign food products.
While major urban areas (HCMC, Hanoi, Haiphong, Danang, and Cantho) have a growing number of modern outlets, much
of the country still relies heavily on traditional marketing channels. Small ?mom and pop? shops and wet markets continue
to play a major role in food distribution.
Strong economic growth and improved per capita income have contributed to the robust expansion of Vietnam?s retail trade.
Nationwide retail sales of goods and services have enjoyed a high growth rate of over 13 percent per year for the last five
years. Food retailing in Vietnam has been growing at an average rate of more than 13 percent per annum. The retail food
sector?s total sales are estimated at $11.5-12 billion, but only about 15 percent of this amount is attributable to modern trade.
Although traditional retail outlets still dominate the retail food sector, Vietnam?s retail industry is steadily transitioning away
from traditional outlets to the more modern mini-mart, supermarket, hypermarket and wholesale centers. Modern retail
channels have grown tremendously in the last ten years, from only a few supermarkets in 1999/2000 to currently over 150
supermarkets, 9 hypermarkets and 12 wholesale centers, and the indicators for further development are strong. As a result of
Vietnam?s WTO commitments, on January 01, 2009, the retail business sector was fully opened to foreign entities. Some
major foreign retail chains (Dairy Farm, LotteMart) have already set up their stores in Vietnam and others have closely
studied the market for future investment.
Rapid growth of modern trade in Vietnam?s retailing sector continues to be fueled by strong economic growth, rising income
levels (especially disposable income), a growing middle class, an increasing young population and increasing exposure to a
western lifestyle. Over the last seven years, modern trade in Vietnam has grown at an average rate of 20 percent a year and it
is expected to continue at this level for the next five years.
Operators in the modern retail food sector are likely to contend with the following:
Shelf life labeling regulations that can be both costly and challenging for food importers /distributors and inventory
Supermarkets rely heavily on merchandising services offered by importers/distributors.
Many supermarkets also earn significant revenues from suppliers in the form of listing fees, shelf space rentals and
various fees and discounts.
It is not unusual for major supermarket chains to receive up to 45 day credit terms from their suppliers.
Promotional and advertising activities often have an impact on sales.
Further growth and sophistication in the retail sector will create additional opportunities for U.S food exporters. Local
importers still continue to play a major role in the introduction, distribution, and promotion of imported food products in
Please refer to VM8083-Vietnam Retail Food Sector Report.
Food Processing Sector
Vietnam?s food processing industry has expanded rapidly over the last few years, together with the growth of the retail
sector. Post believes the overall food processing industry has enjoyed an average growth rate of over 10% per year. With
more transparent regulations and less burdensome paperwork, the Government of Vietnam has successfully attracted not
only foreign investors but also local investors into Vietnam?s food processing industry. Vietnam has also tried to protect
local food manufacturers by imposing high import tariffs (from 15 to 40 percent) on selected food imports that compete with
locally produced products (edible oil, confectionery, snack foods, juices, ice cream etc.).
Dairy products (Fresh milk, UHT milk, ice cream, yoghurt etc.), condiments, canned foods (meat, seafood, fruits and
vegetable), bakery products, snack foods (potato chips, grain-based snacks, dehydrated fruits and vegetables, etc.), juices,
confectionery (biscuits, cookies, candy, chocolate etc.) and hot sauces are all produced locally with acceptable quality.
However, consumer-oriented food products manufactured in Vietnam still strongly rely on imported food ingredients and
Most large local manufacturers have Good Manufacturing Practice certificates or the equivalent (ISO 9002, HACCP). U.S.
food ingredients with the best prospects include dairy products (milk powder, whey and lactose for bakeries, dairy and
confectionary manufacturing), seafood (for further processing and re-exports), meat (pork and chicken meat for meat
processing), turkey MDM (for sausages), lysine (for meat processing), dehydrated potato powder (for snack foods), dried
fruits and nuts (for bakeries), concentrated juices (for juice manufacturing), sweetening, and flavorings.
Food Service Sector
Average per capita income in Vietnam in 2010 was estimated at $1,168 per year, which is significantly lower than other
countries in the region, such as Thailand and the Philippines. For this reason, foodservice in Vietnam tends to be on a much
smaller scale. Moreover, as only 30 percent of the population lives in urban areas where foodservice is more accessible, the
total demand for foodservice is also limited. Foodservice outlets are chiefly in the form of small restaurants, cafés and beer
garden type restaurants, which serve mostly local products. Foodservice outlet chains are still in their infancy and there are
only a few locations present in the market. Management of foodservice chains is weak, thus hampering development and
expansion. Management issues aside, the sector is expanding as it responds to strong economic growth, strong tourism
growth, rising income levels (particularly disposable income), a growing middle class, a sizeable young population, and an
increasing exposure to a Western lifestyle.
Despite the global economic recession, the Vietnam tourism industry still remains strong. After falling by 10 percent in total
number of international visitors in 2009, the tourism sector in 2010 looked much brighter with the number of international
visitors in the passing 5 million, a year-to-year increase of over 30 percent. $8 billion worth of foreign investment in the
tourism sector was reported during 2010.
Over the last five years, the foodservice trade in Vietnam achieved an average growth of over 10 percent per year and is
expected to continue to grow at this rate for the next five years. More consumers in urban areas are demanding an
international eating and tasting experience and increasing numbers are shifting from the ?traditional small outlets? to the
?modern? high-end outlets.
Vietnam?s HRI food service sector comprises over 500,000 outlets including over 400,000 street stalls/kiosks; 6,000 fast-
food restaurants; 74,000 full-service restaurants; 17,700 cafeterias/bars; and more than 10,000 hotels and resorts.
Three-star to five-star hotels are only a small portion of the total outlets, which in total is about 300 units. There are only 35
five-star hotels; 95 four-star hotels and 184 three-star hotels.
The HRI foodservice sector continues to expand due to strong demand from both Vietnamese urban consumers and foreign
tourists. The foodservice sector is expected to see further development on different levels. The number of outlets should
continue to grow due to demand in new urbanized areas. Tougher competition will cause most outlets to diversify their
menus, so as to offer new items to customers. Services are expected to be more diversified and professional. Marketing
efforts should be focused on target audiences. Further development will be not only in major cities such as Hanoi, Ho Chi
Minh City, Da Nang, Hai Phong, and Can Tho, but also in the areas around these cities.
Eating habits have changed and eating out is more popular for Vietnamese urban customers than it used to be. Vietnamese
prefer conducting business meetings at foodservice outlets rather than in the office. The eating-out trend will help the
foodservice industry expand further.
More high income people are also demanding more sophisticated food and drink menus at higher-end restaurants.
As a fast-developing country with high migration from the countryside to big cities, the urbanization in Vietnam has been
strong, especially in Hanoi, Ho Chi Minh City and other major cities. New living areas and office buildings will lead to
greater demand for modern retail and foodservice outlets. Many foreign investors have also launched huge construction
projects in Vietnam. These investments will help to further drive urbanization in the country. People have moved to work or
live in these new areas and have created demand for new foodservice outlets.
Fast food, a concept that came to Vietnam only recently, is perceived as modern and has seen expanded development in the
last four years. After a long period of striving for success in Vietnam, multinationals such as KFC and Lotteria have started
to turn a profit. Fast food outlets associated with Western eating habits have become popular among students, young office
workers, teenagers, and children. In addition to fast food, coffee chains have begun to expand further in the last four years.
Independent Western and Asian restaurants have also seen rapid growth. The trend in fastfood brings more demand for
imported foods including condiments, (tomato ketchup, mayonnaise, etc.), chicken meat, beef and frozen potatoes.
There has also been a