Young entrepreneurs looking to start a coffee shop should be aware that customers are increasingly reluctant to spend over VND100,000 ($4) on a cup of coffee, opting instead for more affordable alternatives.
I used to visit coffee shops regularly, but in recent years that is no longer the case. I feel like I can work from home just as easily, and spending VND50,000-70,000 ($2-2.8) on a cup of coffee for a few hours at a shop does not seem worth it.
In a recent survey, the most common spending range was between VND41,000 and VND70,000 VND per cup, according to 45% of respondents. Many Vietnamese have stopped spending VND100,000 per drink, the survey said.
Going to coffee shops has become much more expensive ever since I started brewing coffee at home. Even if I am in a rush, I will buy machine-brewed coffee from a street vendor for just VND15,000.
Coffee shops, however, need to cover a variety of costs, including labor, ingredients and most importantly, rents. To open a good coffee shop, the location has to be prime and spacious, but the rent is far from cheap.
I have observed that my friends now visit coffee shops less frequently. They only go when they have meetings with clients or business partners, and even then, not very often. For casual chatting and socializing, they prefer affordable street cafés.
In my opinion, these trends indicate that competition in the food and beverage industry, especially in the coffee shop sector, is becoming increasingly fierce. The closure of 30,000 establishments in the first half of the year is one clear example of this.
With this in mind, those of you looking to start a business by opening a coffee shop or a coffee chain need to be extremely cautious and thoughtful. As consumers become more price-conscious, convincing them to spend money will become more challenging.
