F&B Industry Trends and Prospects from the end of 2022 to 2023
The F&B industry stands for “Food and Beverage Service” and is a business that sells food and beverages in the market. This is regarded to be a potential consumer goods industry with great potential for development in Vietnam. Reviving, understanding market trends, and maintaining community momentum are vital to F&B’s recovery, especially in times of the new normal.
Overview of the F&B market
According to BMI market research company, Vietnam became one of the most attractive F&B markets globally. According to statistics, the F&B industry contributed 15.8% to the total national GDP (in 2021). Total spending on food and beverages accounted for the highest proportion with about 35% of spending.
The rapid changes in consumer shopping behavior and spending patterns after the pandemic resulted in the high-speed growth of the e-commerce industry and the increased need for a seamless, consistent omnichannel experience. This makes F&B one of the most successful retail businesses in Vietnam. More and more restaurants and eateries are opening, meeting the great dining needs of customers.
In accordance with data from DCorp’s report, our country now has more than 540,000 shops selling food and drinks. These are about 278,424 micro-scale models, 153,576 small-scale models, 34,128 medium-scale models, and 73,872 large-scale models (2021). Of course, these numbers will continue to rise in the future because the potential exploitation is still very large.
Outlook of Vietnam’s F&B market
Reviewed by Colliers, Vietnam is a bright investment destination for F&B compared to Southeast Asian neighbors. Because Vietnam has a young, dynamic, fast-adapting, growing population that is estimated to reach 105 million people by 2030.
In addition, people’s expenditure on food services is also at a high level with more than 360 USD/month. This is a higher number than countries in the region such as Indonesia, Thailand, Philippines, and Malaysia.
In the incoming quarters, experts predict that input materials tend to decrease. As a result, the profit margins of industry players will have a chance to increase or remain resilient in 2023.
In particular, Vietnam’s F&B industry is expected to grow even more. Food and beverage services will be widely opened thanks to policies to stimulate tourism and attract tourists. All will contribute to promoting the strong development of the F&B industry in general and industry businesses specifically.
F&B industry trends in the future
The two years of the Covid-19 pandemic have had a heavy impact on businesses, especially in the F&B sector. Despite that situation, many enterprises with flexible adaptability have quickly grasped trends and opportunities in danger and quickly transformed to withstand the storm and recover as well as develop after the pandemic.
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Businesses target the young
Currently, the Vietnamese population aged between 16 and 30 occupy about 25% of the total population of the country. With a high proportion of the young population, it will be a great development resource, bringing abundant creativity to Vietnam’s F&B industry. This will be a solid foundation for the F&B industry to grow even more in the future.
Besides, the demand for food in restaurants and bars among young people is constantly increasing, especially in big cities. According to the assessment, young people from 15 to 25 years old are the potential customers that F&B businesses need to pay attention to most.
The fact represents that young people are always ready to spend a large amount on food services. It is also considered the leading target group of food and drink business locations.
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Consumer trends are gradually moving towards healthy products
Healthy product is a market that businesses need to be concerned about and develop. Users are willing to spend more to be able to assure the quality of the food and drinks they consume.
Specifically, wholesalers and manufacturers in the F&B industry may trade in nutritional products of plant origin, organic foods, or with healthy ingredients. In addition, selling products that cater to dietary needs, typically a low-salt, gluten-free, or keto diet (reduce carb diet).
At the same time, customers are now paying more attention to environmental factors to make appropriate choices. Therefore, the F&B industry in the coming time will focus on more sustainable values, and at the same time open up new directions for those in the industry. Companies need to be more careful in the branding process, from sourcing raw materials to product packaging.
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Cashless payment trend
The shift of consumers towards digital payment habits will be one of the trends that are forecasted to continue to. In the era of digital transformation, the application of technology to pay for purchases has gradually become popular.
Nowadays, young people are familiar with paying via QR codes, and e-wallets on smartphones, or cards rather than using cash. Food and beverage businesses are steadily having to apply multiple platforms that integrate payment methods in line with the world’s trends. This is such a wise choice to approach a wider audience.
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E-commerce trends in the F&B industry
E-commerce in the F&B industry is on the rise and will continue to expand thanks to sophisticated digital networks and a growing number of online shoppers.
The researchers forecast that online sales will account for 15-20% of the entire F&B industry revenue by 2025. The same study also shows that GenY takes 49% of all online purchases (a number that is expected to increase as the young consumer population matures).
Therefore, in the F&B industry, wholesalers and manufacturers need to be clearly aware of “breakthrough trends” and use them to their advantage by shortening the time to market and turning over the product as much as possible.
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