Vietnam's TNI King Coffee to boost global presence with cafes in many countries
By Celine Chen
SINGAPORE, NNA - From a startup in 2008 to a global player, the phenomenal growth of Vietnam's TNI King Coffee has seen its instant, ground and whole-bean coffee products being enjoyed in more than 120 countries and territories around the world today.
After achieving much success in retail sales, the company has been focusing on expanding its cafe network beyond Vietnam in recent years.
King Coffee, which already operates 50 outlets in Vietnam and South Korea, aims to set up 1,000 cafes globally, in places like China, the Middle East, Europe, Russia and all over Southeast Asia, according to its website and a press statement issued earlier this week.
The company said it plans to open 20 more stores this year and another 100 by 2022 in the United States through franchising after launching its first US cafe in Anaheim, California on Monday (May 24).
In 2020, its international retail market expanded from 60 to more than 120 countries and territories, with revenue and market share soaring by 200 percent since then, it said without revealing details.
The company also highlighted how the Russian market managed to grow by as much as 350 percent despite the on-going global pandemic.
The meteoric rise of King Coffee could be attributed to the single-mindedness of its founder and CEO, Madam Le Hoang Diep Thao, a coffee expert with a wealth of experience starting with her work with the Trung Nguyen Group which she helped to set up.
As a co-founder of Trung Nguyen, Diep Thao was instrumental in building the group to become a top coffee brand in Vietnam. She also took Trung Nguyen and its popular G7 products to the world.
TNI or Trung Nguyen International was founded in Singapore in 2008 by Diep Thao, who now heads its current head office in Ho Chi Minh City.
In October 2016, TNl launched King Coffee, its first premium coffee brand in the United States. Within months, sales of King Coffee products expanded in the US, and to South Korea, China, Singapore, Australia and India.
In July 2017, King Coffee officially returned to homebase Vietnam and has since established its presence in 64 provinces in the country.
In 2020, London-based Global Brands Magazine hailed King Coffee as the fastest growing coffee brand globally and named it the most famous coffee brand in Vietnam after having raised its profile as a small but formidable player.
The publication also conferred Diep Thao with the title of the "Most Admired CEO" in the food and beverage industry in Vietnam for her contribution to the local coffee sector.
With a mission to help many local coffee growers become successful, Diep Thao, who also sources coffee beans from other countries, believes local consumption will continue to flourish well.
She noted that in 2019, the number of coffee shops and bars in Vietnam rose by 3 percent to 30,770. This boom is expected to continue over the next five years.
According to Mordor Intelligence, the Vietnam coffee market is expected to grow by a robust compound annual growth rate of 8.07 percent from 2020 to 2025, fueled by population expansion at a rate of about one million people a year.
Vietnam, which is the world’s second largest producer and exporter of coffee, has generated high annual growth in sales of Vietnamese instant coffee, which "paints a favorable picture for the future of the coffee industry as a whole", said Mordor Intelligence.
The analyst firm noted that roast and ground coffee products account for nearly 75 percent of domestic coffee consumption, while instant coffee products contribute 10 percent.
On instant coffee gaining traction among millennials in Vietnam, it said, "Busy lifestyles and longer working hours is likely to boost the convenience packaging formats of coffee which have resulted in consumers switching from fresh ground coffee to instant coffee mixes."
It expects the development of premium instant coffee products to boost the growth of its segment.
Mordor Intelligence added, "Increased demand for consumer products and foodservice industry from local and international players is another factor that is expected to fuel the market’s growth."
The coffee market in Vietnam is dominated by Trung Nguyen, Vinacafe Bien Hoa and Nestle which boasts a diversified array of products, said Mordor Intelligence.
Vinacafe commands 40 percent of the market, which is equivalent to the combined market shares of Trung Nguyen and Nescafe.
Other key players are Starbucks Coffee Company, Len's Coffee LLC and Phuc Long Trading Production Company Limited.
Compared to the big boys, King Coffee might seem small, but it has set its sights on far bigger markets across the world.
Apart from its instant and luxury coffees, it is taking Vietnamese food and East-meets-West concoctions to its cafes abroad.
At its Anaheim cafe, for instance, customers could enjoy hand-crafted coffee and meal options like Vietnamese Beef Pho noodles and Banh Mi sandwiches from a broad menu covering breakfast, brunch, lunch and dinner. Or buy gourmet beans to take home.