Vietnam’s coffee shops boom amid business closures

A coffee shop in Hanoi (Photo: VNA)

Hanoi (VNS/VNA) - From small alleyway cafés to high-end coffee chains, Vietnam now boasts over 500,000 coffee shops.

While business closures continue to rise, signalling economic difficulties, Vietnam's coffee shop industry is experiencing remarkable growth.

According to the General Statistics Office (GSO), over 58,300 businesses withdrew from the market in January 2025, a year-on-year increase of 8.1%. Of them, 52,800 businesses temporarily suspended operations, 3,500 waited for dissolution, and 2,000 completed dissolution procedures.

Yet, in stark contrast, new coffee shops are opening across major cities, particularly in Hanoi. These shops are offering everything from traditional drinks to unique concepts such as pet and tech cafés, catering to evolving consumer demands, daidoanket.vn reported.

From small alleyway cafés to high-end coffee chains, Vietnam now boasts over 500,000 coffee shops, according to data from the consultancy group Mibrand.

The country’s coffee market, valued at approximately 510 million SSD in 2024, is projected to reach 765 million USD by 2029, according to F&B research firm Ipis.

Le Tuan Ha, a former construction business owner, recently pivoted to open a technology café. He told daidoanket.vn that technology is a modern trend and in the coffee business, he generates daily revenue without having to worry about bad debts.

Similarly, a Hanoi-based lecturer invested in a pet café to supplement her household income. After deducting expenses, she hopes to save 15-20 million VND per month (589-785 USD) for her family.

The hidden costs behind a café dream

However, industry insiders warn that profitability in the coffee shop business is not as easy as it seems.

Pham Van Duong, owner of Leka Coffee in Hanoi's Hoang Cau street, said before opening his shop, he saw countless online stories about people making fortunes from selling drinks.

Inspired and eager to start a business after losing his job, Duong invested in a coffee shop. However, after three months, Duong said he is still losing money due to unexpected costs such as ingredient quality issues, trendy interior designs and social media advertising expenses.

Le Tuan Ha, another coffee shop owner, noted that while the cost of coffee beans was relatively low, accounting for just 10% of total expenses, the real challenge lied in maintaining profitability.

Investments in location, equipment, branding and staff wages quickly added up, making it difficult to sustain a stable income, Ha said.

He said his shop has 30 tables and after deducting expenses, he earns around 60 million VND per month in profit, but the business requires his full attention and he can't take holidays or even a day off.

Nguyen Hai Linh, director of an organic coffee company in the Central Highlands, said the sector offers flexibility, making it accessible to both start-ups and established brands.

However, it demands proper investment, industry experience and strategic planning. If done correctly, it can be profitable, but many newcomers underestimate the challenges, Linh spoke to the online newspaper.

According to trade experts, Vietnam's coffee industry contributes around 3 % of the country’s GDP and the overall beverage sector generates approximately 60 trillion VND for State revenues annually.

While success is possible, experts caution that profitability requires careful financial management, strategic marketing and a long-term commitment./.

VNA