New franchise outlets small-scale coffee shops targeted at takeaway customers.
Trung Nguyen announced the official launch of its new E-Coffee stores on August 10 in Ho Chi Minh City.
It targets having 3,000 such stores after one year.
With the “E” in E-Coffee standing for “energy”, the outlets are small-scale coffee shop franchises targeted at takeaway customers. Each will have an area of four to 40 sq m and will cost between VND65 million and VND175 million ($2,800 and $7,540) to establish.
E-Coffee stores are suitable for all locations, including office blocks, metro stations, markets, and convenience stores. In the beginning, Trung Nguyen will not charge brand and management fees to franchisees.
It will provide training, advice, business guidance, and operational support for partners. In addition to coffee and confectionery, franchisees are also allowed to sell other beverages.
The new retail coffee franchise model already has 100 stores nationwide. By the end of this year, Trung Nguyen aims to triple this number and expand to 3,000 around the country in 2020.
E-Coffee stores will also sell all other Trung Nguyen products, including coffee dispensers and equipment, targeting lower and middle-income consumers.
The coffee shops are different from the existing Trung Nguyen Legend chain, which requires an average investment of VND1 billion ($43,000) in investment for each shop and tries to create a lot of space for customers to enjoy their coffee.
According to the Trung Nguyen Corporation’s 2018 financial report, the company earned revenues of VND4.84 trillion ($207 million), an increase of nearly 8 per cent compared to 2017, but pre-tax profit fell 50 per cent to VND347 billion ($15 million).