Jollibee keeps losing money in Vietnam

Philippine fast food and convenience restaurant group Jollibee Foods has troubles to stay afloat in Vietnam where it opened its first stores a while ago in 2005. With a presence of its legacy Jollibee fast food brand and additionally Highlands Coffee, Coffee Bean & Tea Leaf Vietnam and Pho 24, only Highlands Coffee is profitable, while all three other chains have been making losses for years. Jolibee Vietnam planned to have 300 outlets in the country by 2020, but it only has 150 as of now, fewer than its competitors KFC from the US and Lotteria from Japan. The company…

Philippine fast food and convenience restaurant group Jollibee Foods has troubles to stay afloat in Vietnam where it opened its first stores a while ago in 2005.

With a presence of its legacy Jollibee fast food brand and additionally Highlands Coffee, Coffee Bean & Tea Leaf Vietnam and Pho 24, only Highlands Coffee is profitable, while all three other chains have been making losses for years.

Jolibee Vietnam planned to have 300 outlets in the country by 2020, but it only has 150 as of now, fewer than its competitors KFC from the US and Lotteria from Japan. The company posted a loss of 43.9 billion dong ($1.9 million) last year.

Philippine-associated Pho not a big draw in Vietnam

Pho 24, which sells the traditional Vietnamese rice noodles soup, is struggling to make profits nearly 20 years after it was established. At one point, it had targeted 1,000 outlets, but has only 22 now, mostly in Ho Chi Minh City. This brand alone posted a loss of 89.4 billion dong in 2021.

The Coffee Bean & Tea Leaf is in an even worse situation with just six outlets in Ho Chi Minh City after 14 years in Vietnam. Its prices are up to two times higher than that of Highlands Coffee and its outlets are mostly located in large malls. It has been reporting an annual loss of between 26 billion and 29 billion dong in the last four years.

Highlands Coffee chain makes up for others’ losses

Highlands Coffee, meanwhile, has reported profits for seven of the last eight years. The chain topped the one-trillion dong revenue mark in 2017 and doubled it in two years to cross two trillion dong. Except for last year when it posted a 19-billion dong loss due to Covid-19, Highlands Coffee had posted annual profits of between 55 billion and 100 billion dong in the previous four years and made up for the losses of its sister brands. The chain now has 525 outlets in Vietnam and the Philippines.