1. Barriers to entry
Evaluate the level of competition: High
Barriers to entry are factors that prevent a startup from entering a particular market. As a whole, they comprise one of the five forces that determine the intensity of competition in an industry. The intensity of competition in a certain field determines the attractiveness of a market (that is, low intensity means that the market is attractive).in this case, Vietnam is the potential market for Hesburger. In this case, Vietnam is a potential market for Hesburger.
With a population of over 90 million people, which approximately 65% are under 35 years of age, Vietnam is fertile ground for the fast food store development. For example, the revenue growth rate three largest fast food chains is now KFC, Lotteria and Jollibee at over 30% In the open integration today, the company wants to expand market share and market penetration in Vietnam is very obvious story. For a long time, Vietnam has appeared in a lot of names of fast food corporations such as KFC, Lotteria ... But to end of 2012, and the major brands: Subway, Burger King ... also set foot in Vietnam shows that Vietnam is an extremely potential market. Most prominent, in January 2014, McDonald's also has special foot in Vietnam caused a new wave of fast food market in Vietnam. McDonald's has expanded its business in countries around the world and most of them under franchise model. The important factor to help McDonald's fast expansion into global markets is an export stategy management business model has been developed and tested in the US market. From McDonald's, Hesburger also penetrate the Vietnam market in the form of franchising. To easily gain better access needs and tastes of customers in each market in Vietnam, Hesburger have to invest time, effort and money to research the market, based on these studies to adjust the their products to suit consumer culture. For example: In Vietnam, the Hesburger proposed 2-3 dishes suit local tastes. In summary the Hesburger penetrate Vietnam promises repartition between the market share pie "giants" fast food world. However, who will dominate this market, the time will answer. Immediate Hesburger will face hurdles in finding and establishing a network of product supply input standards for their restaurant. In new markets, to meet the strict conditions of quality management and operation of Hesburger is not easy with the existing suppliers. If Starbucks is considered as a new element in Vietnam's coffee market, the emergence of the McDonald's empire would be a "threat" to the brand from American fast food like KFC, Jollibee, Lotteria from Korea are business in Vietnam and also is a great competitor for the fast-food brands looking to enter the market in Vietnam as Hesburger. Accordingly, enterprises can hardly keep up with the giants like McDonald's. Besides, the franchise fee is a major barrier to entry into the market of Vietnam Hesburger. It mean, the initial fee to open franchisees, we estimate that no less than $ 700,000, not to mention more others, including 20 service fee paid to the franchisor. Overall, franchise businesses have charged double, including operating expenses before and during trading. Total capital investment (transfer fees, rent, equipment, and interior) for every Hesburger may be around 200,000 to 2.2 million. So, right now there are great potential, capable of abundant money can receive a franchise fee giant. 2. Industry rivalry
Evaluate the level of competition: Average
Industry rivalry—or rivalry among existing firms—is one of Porter’s five forces used to determine the intensity of competition in an industry. Industry rivalry usually takes the form of jockeying for position using various tactics (for example, price competition, advertising battles, and product introductions). This rivalry tends to increase in intensity when companies either feel competitive pressure or see an opportunity to improve their...
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