Vietnamese consumers spent over VND320 billion (US$12.6 million) on coffee and milk tea every day last year, contributing to total sales of VND118.3 trillion (US$4.6 billion) for beverage shops in 2024.

This data was released in a market report by iPOS.vn, a management solutions platform for over 100,000 restaurants and coffee shops, in collaboration with Euromonitor, and VIRAC.

The findings were based on a survey conducted by iPOS with nearly 4,500 respondents nationwide, primarily in Hanoi and Ho Chi Minh City.

Consumer insights

The report showed a 13% revenue increase, the highest growth rate from 2018 to 2024.

This growth was driven by consumers' return to a busy lifestyle reminiscent of the pre-pandemic era, as coffee shops, milk tea venues, and bars have evolved into multifunctional spaces, the report said.

Consumers flocked to these venues for socializing, remote working, studying, and business meetings.

In addition, the rise of coffee culture in Vietnam, coupled with modern consumer trends and a growing middle class, has contributed significantly to the industry's growth in recent years.

The survey found that Vietnamese consumers were increasingly favoring out-of-home beverage options, with 51% visiting these venues three to four times a week, double the rate of a year ago.

Spending in the range of VND21,000 ($0.8) to VND35,000 ($1.4) also rose in 2024, accounting for 40% of purchases while the share of those spending less than VND20,000 ($0.78) increased from 4.3% in 2023 to 12.3% in 2024.

Meanwhile, the premium beverage segment (priced at VND70,000 ($2.7) and above) declined sharply with the share of shoppers in this category dropped significantly from 7.3% in 2023 to to just 5.1% in 2024. This shift prompted several premium brands to ramp up their promotions over the past year.

Notably, there was also a sharp fall in the number of consumers willing to spend between VND35,000 ($1.4) and VND50,000 ($2). This group dropped from 47.7% in 2023 to 31.5% in 2024. 

Vietnam’s F&B sector sees modest growth

The number of food and beverage (F&B) outlets in Vietnam reached 323,000 in 2024, up 1.8% year-on-year. The total revenue of the sector was estimated at around VND689 trillion ($27 billion), representing a growth of nearly 17%.

However, this growth was not uniform and largely driven by the performance in the first half of the year, according to the report.

In the second half of the year, as the economy recovered, consumer spending fell sharply, especially after Typhoon Yagi. By November 2024, as the market entered the year-end holiday season, sales were expected to show signs of recovery. In addition to domestic factors, growth in the F&B sector was significantly supported by the return of international tourists and a surge in online food delivery services.

iPOS forecasted that total revenue for the F&B industry will reach nearly VND755.4 trillion ($29.6 billion) this year, representing a growth of about 9.6%. This increase will be slower than in 2024, mainly due to rising unemployment, salary cuts in the private sector, and rationalization efforts in state-owned enterprises.

Vu Thanh Hung, CEO of iPOS, noted that, from the latter half of the year, the F&B sector is expected to gradually recover, driven by overall macroeconomic growth, stabilizing policies and business environments, and improving consumer spending.

Vietnamese milk tea brand Phuc Long expects fierce competition as brands diversify their products, especially healthier options, and boost online sales. Only agile and innovative brands will be able to maintain market leadership.

In 2025, the Vietnamese tea and coffee brand plans to modernize its stores, updating its identity while retaining signature elements. Expansion will focus on strategic locations for better visibility. The brand will also improve the customer experience on digital platforms and in-store services for seamless interactions.

For the upcoming year, net revenue is projected between VND1.9 trillion ($74 million) and VND2.2 trillion ($86 million), aiming for 18% to 36% growth. The company is dedicated to continuous product innovation and service improvements to deliver top-quality tea experiences in Vietnam’s dynamic beverage market.