TRƯỜNG ĐẠI HỌC KINH TẾKHOA QUẢN TRỊ KINH DOANH

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INTERNATIONAL MANAGEMENTBUSINESS PROJECT

TOPIC: Protential McDonalds in Viet Nam Market

( QH2011E-QTKD)

Group 3: Dang Thi Lien Nguyen Nam Phuong

Nguyen Hoang Long Nguyen Thu Quynh

Nguyen Van Linh Pham ThuyNhung

Nguyen ThiThao Ly

-HA NOI, 5/2013-

Table of ContentsI. INTRODUCTION...................................................................................................................2

1. Brief introduction:..................................................................................................................2

2. Product:..................................................................................................................................2

3. The reason for choosing Vietnam:.........................................................................................3

II. VIETNAM MARKET ANALYSIS...........................................................................................4

1. Political..................................................................................................................................4

2. Economic................................................................................................................................5

a. Member of WTO...............................................................................................................5

b. Steady economic growth...................................................................................................5

c. Emerging market...............................................................................................................6

3. Social- Culture.......................................................................................................................8

a. Culture:..............................................................................................................................8

b. Consumption habits.........................................................................................................10

4. Technology...........................................................................................................................10

5. Legislation............................................................................................................................12

6. Competition..........................................................................................................................13

7. The cost of franchsing..........................................................................................................16

III. SWOT ANALYSIS............................................................................................................16

1.Strengths................................................................................................................................16

2.Weaknesses...........................................................................................................................17

3.Opportunities.........................................................................................................................17

4.Threats...................................................................................................................................18

IV. MARKET PRESENTATION STRATEGY......................................................................18

1.Product strategy.....................................................................................................................18

2.Price strategy.........................................................................................................................22

3.Promotion strategy................................................................................................................23

4. Distribution strategy.............................................................................................................26

5. Plan of implementation........................................................................................................26

V. CONCLUSION...................................................................................................................27

McDonald – firm from US and a famous brand about fast food all over the world

Group 3: Dang Thi Lien Nguyen Nam Phuong

Nguyen Hoang Long Nguyen Thu Quynh

Nguyen Van Linh Pham ThuyNhung

1

Nguyen ThiThao Ly

I. INTRODUCTION.

1. Brief introduction:McDonald’s Corporation is the world’s

largest hamburger fast food chains which

serves up to 64 million customers daily.

Mc Donald’s primary sells humberger,

cheeseburgers, chicken, frech fries,

breakfast items, soft drink, milkshakes,

and desserts. In response to changing

customer tastes, the company has expanded its menu to include salad, fish, wrap,

smoothies and fruits.

2. Product:

Hamburger

A juicy 100% beef patty simply seasoned with a pinch of salt and pepper, tangy

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pickles, minced onions, ketchup and mustard.

Chicken & Fish

From our ever-popular Chicken McNuggets, our fabulously fresh salads or the

classic Filet-O-Fish, both chicken and fish from McDonald’s are delicious choices.

McCafé

Welcome to the world of McCafé. Whether it's our freshly made coffee or our cool

Smoothies, rich Shakes or a tasty Frappé, we've got something guaranteed to make

your day.

3. The reason for choosing Vietnam:

McDonald’s entry into Vietnam is certain to bring a new style of fast food service to

local people and will no doubt provide strong competition to similar names like KFC

(US), Jollibee (the Philippines), Lotteria (Japan), which have been in ietnam for more

than 10 years and Subway (US) which just entered.

Vietnam is a huge potential to McDonald’s global expansion. Over the years,

Vietnam has enjoyed strong economic growth, a change in spending habits,

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increasing demand for western brands, growth in urban population and a major

tourist destination. Vietnam now has a more prosperous population with disposable

earnings and a cultural tendency to expend it on fast food in the large urban centers

of Ho Chi Minh (HCM) City, Danang, Hai Phong, Hanoi, and Can Tho. Vietnam’s two

main cities are Hanoi and Ho Chi Minh City. In the middle of these two cities is the

famous shoreline where local and international tourists visit to adore the remarkable

scenery of the beaches and islands on the South China Sea. These cities are rapidly

gaining attractiveness and the associated fast food service industry is facing

increasing demand.

II. VIETNAM MARKET ANALYSIS.

1. Political.

In 1986 Vietnam introduced Doi Moi (“economic renovation”) the key aim of

this policy was to open Vietnam to foreign investment.

Vietnam has not recently faced any serious threat to its powers and the

situation is expected to remain the same in the coming years. However, in

2011, the disputes over the East Sea was the main cause of some changes in

relations between Vietnam and some important countries in the world,

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especially the Vietnam -China and Viet Nam - U.S. Tension in the East Sea

has escalated due to China's provocative acts in May, 2011.

Government is paying more attention to the benefits and interests of

customers.

Many laws have been passed to define the responsibilities of business firms.

Business firms must meet the requirements on product safety, labor laws,

truth in adverts, environmental issues, and customer’s interest and so on.

2. Economic.

a. Member of WTO.

Vietnam has become the 150th World Trade Organization member after a 12-year

wait, Vietnam has been a member of the WTO since 11 January 2007.

When Vietnam is a member of the WTO, they must comply with the stricter and

fiercer regulations, so the competition will ensure the fairness for all domestic

companies and foreign companies. Vietnam must grant national treatment rules for

the other members of the WTO, mean that they must conduct tariff reduction and

bind all tariff lines, and to remove non-tariff barriers in a time certain.

b. Steady economic growth.

Since the beginning of this century, it has held 3rd place in average annual GDP

growth, just behind China and India (Lehmann, 2010) while per capita income rose

from $220 in 1994 to $1,052 in 2009 (U.S. Department of State 2010). Standard and

Poor’s ratings lowered their outlook on Vietnam from stable to negative in May 2008

which was prescient as Datamonitor indicated that the GDP growth plunged to 3.2%

in 2009.

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In 2012, GDP per capita is at around 1500 USD / year, is low compared with the

area, but if you look at the GDP per capita in the two major cities, Hanoi and Ho Chi

Minh City, we can see a GDP per capita in these two cities is higher than the

national average pretty much (in 2012, Ha Noi at around $ 2,200 /person, Ho Chi

Minh City is $ 3,600 / person).

c. Emerging market.

Vietnam is a true emerging market offering ground floor and growing opportunities

for foreign exporters and investors. Vietnam’s major exports reached $70.7 billion in

2008. Its main export partners were the US (20.8%) and Japan (12.5%). Its major

imports rose to $80.4 billion in 2008 and its partners include China (19.9%),

Singapore (12.1%) and Taiwan (11%).

Vietnam is carrying out the goal of becoming an industrialized and modern economy

by 2020 and meets the ambitious target: stabilize the economy, build world-class

infrastructure, create a skilled labor force, and strengthen market-based institutions.

According to Vietnam Development Report (VDR) 2012, meeting these aspirations

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will not be easy. In fact, the country has experienced bouts of macroeconomic

turbulence in recent years—double-digit inflation, depreciating currency, capital

flight, and loss of international reserves—eroding investor confidence. Besides, rapid

growth has revealed new structural problems. The quality and sustainability of

growth remain a source of concern, given the resource-intensive pattern of growth,

high levels of environmental degradation, lack of diversification and value addition in

exports, and the declining contribution of productivity to growth. Vietnam’s

competitiveness is under threat because the power generation has not kept pace

with demand, logistical costs and real estate prices have climbed, and skill shortages

are becoming more widespread. And these difficulties strongly existed in 2011.

Concretely, the inflation in 2011 was 18.13%; the growth of GDP has slowed

(5,89%). Domestic and international gold price gap increased. The Corruption index

2011 from Transparency International ranked Viet Nam at the position 112.7 This

shows that Viet Nam has been faced one of the most difficult challenges of economic

development.

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In terms of financial, according to the document of World Bank, in 2011, foreign

direct investment inflows (to Viet Nam) continued at a steady pace, although new

commitments declined. International reserves increased in the first half of the year

while the Vietnamese dong benefitted from a period of relative calm. In the last

quarter of the year, however, exchange rate fluctuations increased due to volatility in

gold prices, deepening uncertainties and the seasonal increase in demand for

foreign currency as the year end approaches. With approximate 9 billion U.S. dollars,

the amount of money coming from overseas Vietnamese was one of the biggest

sources of foreign currency in 2011. This amount is equivalent to the amount of FDI.

Hong Kong, Singapore, and Japanese are the countries that contributed the biggest

investment to Viet Nam in 2011. Hai Duong, Ho Chi Minh city, and Ha Noi are three

places that has been most invested in recent time. The sectors that most attract the

attention of foreign investors are processing industry, electricity supply, and

accommodation and dining service.

3. Sociai– Culture.

a. Culture.

The population of Vietnam is 89.2 million (July 2010) with 26% under the age of 14.

It has a 28% urban population with 3.1% rate of change (2005-2010). Vietnamese

have a life expectancy of 71.94 years.

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Some of the traditional cultural influences are the teachings of Confucianism, the

role of the family (Elliot, 2001) and the concept of Face in Vietnamese society. These

influences are still prevalent especially in rural areas but are coming under

increasing pressure from western influences such as consumerism and globalization

due to its young population. There is an increase in demand for consumer and

material goods, leisure activities and foreign and local travel.

Food is a very important part of Vietnamese culture. The Vietnamese not only enjoy

eating but believe eating good food can bring harmony and closeness to the family

and relationships. The types of foods are chosen to bring luck and these vary from

province to province. Buying daily for fresh food is essential for all Vietnamese

cooking. In general, Vietnamese people are not as concerned about nutrition as

Westerner. They are more concerned with the quality of the foods.

Like everything else, Vietnamese food also differs geographically from location to

location. North Vietnam’s food uses soy sauce, fish sauce and prawn

sauce and has many stir fried dishes. With harsh weather and less developed

agriculture than the South, North Vietnamese tend to use less meat, fish and

vegetables; and black pepper (instead of chili) to create spice. The taste is strict and

less sweet, but more salty than in other regions. Central Vietnam is distinct in its

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extreme spices and color of food. Hue’s cuisine, affected by royal cuisine once

created for kings and queens, emphasized on quality and quantity – A meal

constitutes of many complex dishes served only at small proportions. Southern

Vietnamese are heavily affected by Cambodia, Thai and Chinese cuisines (due to

trade and immigrants). Southerners prefer sweet tastes (created by adding sugar or

coconut milk) and spicy tastes (created by chili peppers).

b. Consumption habits.

With higher standard of living, many people tend to eat out more. Specially,

young people willing to spend money to test things. Now, many young people

want to go out with friends, the fast food restaurants is the ideal place, just

clean, good food, suitable price.

Vietnamese like to buy at a cheap price.

Careful in buying decisions.

Not loyal to one product, but some are likely to choose the products they trust.

Vietnamese prefer to try products by themselves than to believe

salespersons.

4. Technology.

In terms of technology, Viet Nam is a rapidly developing country. The year 2011 was

the beginning of the strategic plan of economic and social development, period

2011-2020, in which infrastructural building is considered as one of main targets.

With this plan, the country has been building many expressways and will let the local

transport network be eventually upgraded to meet the requirements of rural

industrialization and modernization, and connect itself with the national system.

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In addition, the above plan also includes a project which will work to narrow its

scientific and technological gap with the world in some key fields by 2020. To launch

this project, the Government will give top priority to enhancing the competence of

scientists and related managers while encouraging the organization of training

courses partnered with foreign competent partners. According to the project, the

Government will focus on scientific and technological renovation to sharpen the

competitive edge of local products and assisting businesses to purchase patents in

some prioritized areas: biotechnology, information technology, new materials

technology - nanotechnology , manufacturing technology and automation.

An estimated 2.0% of Vietnamese households have a broadband-enabled computer,

representing a significant increase from the 0.1% of households in 2005. The rapid

uptake is partly as a consequence of the ease and low price of connection.

According to the Ministry of Information and Communication, there were 22.8 million

internet users in Vietnam in 2009, accounting for 26.6% of the total population, and

an increase of 112.7% on 2005. For number of internet users, Vietnam has been

ranked seventh highest among the countries with high internet use in Asia, by

Internet World Stats. There is increasing consumer interest in technology and

technical gadgets (Steinglass, 2010). Industry specialists estimate that there are 50

million actual subscribers to mobile phones.

The IT Hardware and software markets have grown 13-15% per year for the past 5

years, which are mainly imports as Vietnamese manufactures are still relatively new

to the market. Hard market is 89% market share by foreign suppliers which shows a

low level of indigenous innovation.

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As a new member of the World Trade Organisation, Vietnam will continue to

implement tax cuts as part of its commitment under the information technological

agreement. This all illustrates a country open to adopt new technologies but lacking

in knowledge and dependent on external expertise.

Modern and high-tech equipment are in use.

Standard of living has improved due to people living in more convenient

conditions and is offered various products and services on demand.

5. Legislation.

Following the open-door policy of 1986, Vietnam has enacted its Constitution in 1992

to strengthen legal institutions and to pave the way for its party-led economic reform.

Vietnam improve its legal system in order to create a favorable environment for the

development of a multi-sector market economy as well as a more open and stable

investment environment. During recent years, many laws and regulations have been

enacted to establish the legal framework for the open-door policy and to comply with

the integration requirements of international agreements, of which the most

important laws include:

The Civil Code (2005)

The Labor Code (1994, as amended in 2002 and 2006)

The Commercial Law (2005)

The Law on Enterprises (2005)

The Law on Investment (2005)

The Law on Credit Institutions (1997, as amended in 2004)

The Land Law (2004)

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The Law on Accounting (2004)

Law on Real Estate (2006)

Law on Tax Administration (2006)

Law on Social Insurance (2006)

Law on Personal Income Tax (2007, effective as 1 January 2009)

Law on Corporate Income Tax (2009)

Law on Value Added Tax (2009)

The main legislation governing foreign direct investment (FDI) activities are the Law

on Investment and the Law on Enterprises in Vietnam. With a view towards creating

a comprehensive legal framework for FDI activities in accordance with international

standards, Vietnam has signed and acceded to various bilateral and multilateral

arrangements on investment, such as agreements for the promotion and protection

of investment with 46 countries and territories, Framework Agreement on the ASEAN

Investment Area (AIA), etc. The international agreements contain provisions

inconsistent with the provisions of the legal instruments on FDI; the provisions of the

international agreements shall be applied.

Weak and evolving legal system.

Judiciary is controlled by the ruling party (CPV).

Vietnam is constantly passing progressive laws that are making it more open

for foreign investors to do business.

Potential government interference to satisfy their own agenda.

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6. Competition.

McDonald’s will face intense competition in Vietnam local with both Vietnamese

competitors and foreign competitors.

The Vietnamese competitors:

Now, in Vietnam, there are so many sidewalk bakery, we cannot count exactly, but

one thing is very clear that the sidewalk bakery appear everywhere from the

downtown to uptown.

Walking around the streets we can see many street vendors like tea, noodles, bread

soup, pancakes, fried fish ball ... The cuisine is very diverse and cheap. It is suitable

for many for people.

With so many "competitors" and the consumption habits of Vietnamese often

eat out in street vendors, so it is a challenge for McDonald's.

The foreign competitors.

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At present, some fast food chains in Vietnam such as Lotteria is still leading the

domestic fast food market with 146 shops, while KFC has 134 and Jollibee 30.

However, KFC has higher growth rates and turnover.A report of Euromonitor showed

that KFC led the fast food industry in Vietnam in 2011.

Its biggest rival is KFC (Yum Brands) which has 134 outlets and has operated for 16

years in Vietnam (from 1997). Vietnamese customers are already familiar with their

brand and they have been expanding by the year. KFC has a well-developed

distribution system that permitted it to gain access to places other than the main city

locations. KFC marketing policies focus on the young population and children with

special marketing programs. KFC is also planning to launch their drive-thru

restaurants.

Lotteria is one of the most successful restaurant chains in Vietnam. Lotteria invested

in Vietnam from 1998, now it has 146 restaurants. Lotteria offers a range of

promotions such as discounts of fifteen percent to twenty percent to make their

restaurants more attractive to Vietnamese customers. With a steady expansion

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strategy, Lotterria has vowed to continue to conduct research and develop products

and services to make them suitable with Vietnamese customers.

Jollibee (start in 1996) with 30 restaurants has seen Vietnam as a key market to its

growth.

Beside 3 big and long-standing fast food brands, recently, several fast food brands

also have entered Vietnam market such as Burger King, Pizza Hut, Afresco.

7. The cost of franchising.

Who could be the partners of McDonald’s then? It’s obvious that the businesses or

individuals who have the plan to become McDonald’s partners need to be very rich.

It’s simply because McDonald’s is a big brand name with high value which would set

up very high requirements.

Regarding the franchising fees, the initial fee would be no less than $45,000.

Moreover, the franchisees would have to pay a lot of other kinds of fee.

In general, there are two kinds of expenses to bear, the pre -operation expenses,

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and the expenses to be spent during the operation. It is estimated that the total

investment capital for every McDonald’s shop, which includes the franchising fee,

premises rents, equipments and interior decoration, could be between $214,000 and

$2.1 million. And in order to succeed and profit in Vietnam, more than 88% of its

McDonalds franchisees have more than one shop.

III. SWOT ANALYSIS.

1. Strengths.

- There areenthusiastic and responsible staffs.

- There are strong public relations strategies: the implementation of good

corporate social responsibility promote the company's image

Franchise System: strong franchising strategies helps companies to expand the

market further.

- Modern Technology: Applying the standard and modern production models

- McDonald’s will be able to implement its QSCV Principle

- McDonald’s Quality assurance and good customer service are better than

competitors : Information products are always made public: the disclosure of

nutritional ingredients helps companies to expressed interest to customers and

demonstrate their responsibility. Ensuring the safety of food is an opportunity to help

the company further develop the market in the period of increasing demand for heath

standards.

- Aggressive competitive strategy

- Low price of products

- Ability to learn from competitors’ mistakes

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2. Weaknesses.

- Late Entry: Entering market late may cause company to face difficulty in

approach customers due to buying habits.

- The franchises store may face many risks to management.

- Limited Menus than competitors

- Contribution to obesity

3. Opportunities.

- Largest metropolitan city in Vietnam with 9 million people. Majority of the

population is young and literate.

- Economic center of Vietnam- GDP per capital is $2800 compared to Country’s

average of $1042. Fast growing economy that has reduced poverty rate to the barest

minimum.

- Good transport and communication systems.

- Tourism haven

- Huge pool of skilled labor force

- Increase in demand for fast food in Vietnam

- Innovation in product and services

- Fast food penetration still low which is an opportunity for growth

4. Threats.

- More local and foreign competitors rising quickly.

- Government policies on fast food and healthy meal:

- The existence and development is a difficult task for all businesses included Mc

Donald during the recession of economy

- Outbreak of bird flu.

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IV. MARKET PRESENTATION STRATEGY1. Product strategy

Permanent Product Strategy.

McDonald's features

several products on their

menu that are permanent

and do not change.

Examples of this include

their basic hamburger and

cheeseburger, the Big

Mac and the Quarter

Pounder. After the initial

development, these items

remain on the menu for extended periods of time without undergoing significant

changes. This strategy ensures that there is always something familiar for

consumers on the menu.

Type of product :

Burgers & Sandwiches

Chicken & Fish

Breakfast

Salads

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Snacks & Sides

McCafé

Beverages

Desserts & Shakes

Temporary Product Strategy.

In addition to its permanent product offerings, McDonald's regularly develops

temporary products. The McRib, for example, is a product that is offered only

seasonally. The Big Ocean burger is an example of a burger that was developed as

a temporary product, offered only for a few months in 2007. The purpose of this

product development strategy is to give customers something new to experience on

each visit and to experiment with new items that may become permanent.

Local Product Development Strategy.

As McDonald's has expanded internationally, it has created several products to meet

consumer demand in the local markets. In the

Netherlands, for example, they have developed the

McKroket, a burger featuring a typically Dutch kroket,

a deep-fried, ragout-filled patty. In the Canadian

province of Quebec, McDonald's offers poutine, a

traditional dish of french fries, gravy and curd cheese.

Even in parts of New England and Atlantic Canada,

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they have developed the McLobster, their version of the local lobster roll sandwich.

This strategy ensures that local customers have foods to fit their tastes.

In addition to its permanent product offerings, MC’s Donald also develop temporary

products, local products and local adaptation products which are suitable for

Vietnamese tastes.

Local Adaptation Strategy.

In addition to developing new products for local markets, McDonald's will also use an

adaptation strategy whereby they take a product and modify it to fit local tastes. In

India, for instance, the Big Mac has been modified into the Maharaja Mac which

contains no beef, in keeping with local diets. In Greece, the Big Mac has been

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adapted to use a pita bread instead of a bun. Even the McLobster has been adapted

to the McCrab in some U.S. markets where crab is a common food.

Vietnam is country developed in agriculture. McDonald’s will ready get raw materials

like milk, vegetables and potatoes while the company can export the excess

supplies to other countries.

McDonald’s will focus on strategies related to quality breakfast, convenience, menu

additions, value for money, extended hours of service, drive through restaurants and

delivery services.

2. Price strategy.

Mc Donalds follows Value pricing as it offers its products at a much cheaper rate

as compared to its competitors like KFC etc.It also uses bundling strategy by

offering combo packs to increase overall sales in combination with competitive

pricing.

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McDonald’s will franchise some of its restaurants in Vietnam to reduce the

business expansion cost and create more jobs opportunities for the local people.

If you build a McDonald's in the right area, the people will come, but good pricing

surely plays a role in getting them to come back. One of the main elements of

McDonald's marketing strategy is effective pricing of their product. Knowing that their

target market consists in large part of families, who often need an affordable way to

dine out with the children, their menu over the years has been priced in a way that

allows virtually anyone to eat at McDonald's and enjoy a quality meal without

spending a large amount of money. What it reallycomes down to is value- people

enjoy McDonald's food which is a big part of repeat business; the best pricing in the

world will not sell a product if the consumer does not perceive value in what they are

purchasing (McCracken, 1990). In fact, McDonald's states this outright in their "Value

Menu" offerings of recent years, which

provide selected menu items at a bargain

price, most times, $1.00 or less. To

integrate another marketing concept into the

strategy of the Value Menu, the items on

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the Value Menu often serve as "loss leaders" in order to sell other products which

are profitable; for example, you may purchase McNuggets for $.99, which represents

a tiny if any profit for McDonald's, but the French fries and soft drink that you select

to accompany the McNuggets are usually profitable, so that you have gotten a good

price, but McDonald's has also realized a profit. Loss leaders are an age-old

marketing strategy that McDonald's has raised to an art form. In a form of quid-pro-

quo, the concept of giving something to get something more valuable in return has

become a theme in the menu of this fast food giant, and again, it is done so well that

the average person does not realize it, which is one of the ideas of skillful marketing

to begin with.

3. Promotion strategy.

When talking about McDonald's within the scope of marketing

promotion, one hardly knows where to start. As a general

statement, it is fair and accurate to say that promotion is one

of the pillars of McDonald's success. Let us clarify this statement; while it is

indisputable that McDonald's has built a loyal following for decades through a quality

product, easy availability and value, none of these wonderful things that McDonald's

has perfected would be known by anyone if they were not properly promoted. The

success of the promotional message is evidenced by the cross-generational loyalty

of customers and many other factors. 

The promotion that McDonald's utilizes takes many forms and has evolved over the

years. Their longest-living promotional "spokesman", who is known in virtually every

corner of the planet, is Ronald McDonald. This cartoon-like character (who has in

fact been portrayed by real-life actors and cartoon characterization alike) brings

smiles to the faces of "children of all ages" and lends a sort of hometown good

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feeling to McDonald's restaurants. As an offshoot of Ronald McDonald, the cast of

characters over the years has expanded to include such luminaries as HamBurgular,

Mayor McCheese, and Grimace, the purple hero of billions of people long before

Barney the Dinosaur ever existed. These carefully created characters not only

promote good will for the company as a whole, but their appearance and names in

many cases cause an association with a certain menu offering within the mind of the

customer. 

Another recent marketing phenomenon that McDonald's has struck gold with is

product placement. Not to be confused with their product strategy, this instead refers

to having McDonald's products and logos clearly visible in motion pictures and

television programs, which McDonald's pays big dollars for, of course. For example,

when the gang on "Friends" is eating Quarter Pounders, it is advertising within the

plot of the show itself, so even those who ignore regular television commercials

receive the McDonald's marketing message without realizing it. 

McDonald's also engages in a sort of "co-operative" marketing with popular movies

by offering "limited edition" collectibles or toys featuring characters from the movie,

often along side Mayor McCheese or HamBurglar. The collaborative effort attracts

moviegoers to the restaurant and vice versa - -everyone wins! 

Within conventional promotion as well, McDonald's spends billions of dollars each

year on print, radio and television advertising. This advertising allows McDonald's to

use their well established characters such as Ronald and Grimace to communicate

the message that "you deserve a break today". In some cases, celebrities and sports

personalities are used in advertisements for the product, in order to appeal to a wider

audience beyond children and the McDonald's faithful. 

Another promotional tool that McDonald's has skillfully used in recent years is the

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promotion of "healthy" menu items such as salads, fruit and yogurt, and the like. This

was likely sparked by the government requirements that restaurants such as

McDonald's make public the nutritional facts of their food. Turning this into a positive,

they have added "healthy" items to the menu and emphasized them both in an effort

to appeal to a new market segment, but also to downplay the less than positive

nutritional facts of many of their traditional menu offerings. If the traditional

McDonald's customers eating habits have changed, the menu has also changed to

accommodate them. This is an excellent example of marketing that evolves in

relation to the changing needs of loyal customers. At the risk of sounding too

technical, this is truly innovative. 

4. Distribution strategy.

HCM city is an area with a growing

middle class who will be the most

likely to visit McDonald’s restaurants.

The city is also suitable as a start up

due adequate infrastructure,

government support, low tax and convenience. So it is the to open the first

best city conditions restaurant.

After that, Expending expend it in other large urban centers of Ha noi, Da

Nang, Hai Phong, and Can Tho .

McDonald’s will partner with the Vietnamese Ministry of Agriculture and its

associations to facilitate smooth business operations. This type of venture will

give McDonald’s the ease of receiving agricultural supplies, buy supplies and

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build up distribution channels. It will also establish a good network of local

farmers, manufacturers, and other suppliers needed for McDonald’s business.

5. Plan of implementation.

Using a scheme that will satisfy their Vietnamese employees through a

benefits program that will energize, attract, retain and reward talented staff

who will be able to generate superior results and boost the corporations

leadership position in the fast food industry.

Conducting a comprehensive market survey of competitors’ store locations in

Vietnam combined with demographic data that will help McDonald’s

management discern market gaps, improving profitability and overall

efficiency.

Continuing to have the right products at the right price. Consumer taste

inclinations are changing daily and McDonald’s must respond by providing a

variety of taste and price preferences in order to maintain their competitive

advantage alongside other fast food companies.

Distributing outlets into showplaces. The “green field” entry strategy will be

used to build restaurants that will always look fresh and contemporary.

Keep promoting the brand in Vietnam. This includes motivating the employees

to work for the brand, taking the lead on environmental issues and promoting

consumer health matters.

V. CONCLUSION.

 McDonald’s will encounter some tough challenges as it grows to new markets.

Fundamental to its prospective success will be maintaining its core strengths—a

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persistent emphasis on consistency and quality—while prudently testing with

innovative options. These new initiatives could include identifying more with the local

market andintroducing sophisticated restaurants under novel brands that wouldn’t be

burdened with McDonald’s fast-food image. McDonald’s could also look into growing

more aggressively in other Asian and African countries where the prospects for

substantial growth are greater.

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