Coffee giant Trung Nguyen opens new franchise

admin — Mon, 12 Aug 2019 08:42:31 +0000

Customers paying for a cup of coffee at a Trung Nguyen E-Coffee shop. Photo courtesy of Trung Nguyen.

Trung Nguyen has opened E-Coffee, a small scale coffee shop franchise targeted at takeaway customers.

Each takeaway coffee shop has an area of 4 – 40 square meters, and costs between VND65 million ($2,800) and VND175 million ($7,540) to set up, said Vo Thi Ha Giang, Director of Communications at Trung Nguyen Group.

E-Coffee stores will also sell all other Trung Nguyen products, including coffee dispensers and other equipment, targeting lower and middle income consumer segments, Giang said.

These coffee shops are different from the existing Trung Nguyen Legend chain, which requires an average investment of VND1 billion ($43,100) in investment for each shop, and tries to create a lot of space for customers to enjoy coffee, she added.

“E-Coffee is optimized for all locations including office buildings, metro stations, markets and convenience stores. In the beginning, Trung Nguyen will not charge brand and management fees from franchisees,” said Giang.

“The company will provide training programs, advice, business guidance and operational support for partners.” In addition to coffee and confectionery, franchisees are allowed to sell other beverages.

The new retail coffee franchise model already has 100 stores nationwide. By the end of this year, Trung Nguyen aims to triple this number, and expand to 3,000 stores in 2020.

According to the Trung Nguyen Group’s (TNG) 2018 financial report, the company earned revenues of VND4.8 trillion ($207 million) in revenue, an increase of nearly 8 percent compared to 2017, but pre-tax profits fell to VND347 billion ($15 million), a 50 percent decrease.

The report said the group has faced falling profits in the last three years due to rapidly rising operating expenses and internal conflicts between chairman Dang Le Nguyen Vu and ex-wife Le Hoang Diep Thao, who jointly managed the corporation.

Vu and Thao got divorced early this year. After months of litigation, the Ho Chi Minh City People’s Court ordered in March that the stocks and cash assets of TNG shared by Vu and Thao be split 60:40 in Vu’s favor in their divorce settlement. Thao has appealed.

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Vietnam coffee giant Trung Nguyen sees profits halved

admin — Tue, 11 Jun 2019 00:44:43 +0000

Trung Nguyen Group began experiencing difficulties six years ago, when Vu and his wife, Le Hoang Diep Thao, fell out on how the corporation should be run. Photo by Reuters.

Racked by an internal conflict, Trung Nguyen Group’s profit has declined continuously over the last three years.

According to Trung Nguyen Group’s (TNG) newly-released 2018 financial report, the company recorded VND4.8 trillion ($205.93 million) in revenue, an increase of nearly 8 percent compared to 2017.

However, profit before tax dropped sharply by nearly 50 percent, to VND347 billion ($14.89 million) compared to nearly VND681 billion ($29.22 million) in 2017.

According to the report, TNG’s profit margins have been falling in the past three years. Gross profit margin in 2016 was 37.4 percent. It fell to 34 percent in 2017 and 27.9 percent in 2018.

Profits have been squeezed most by rapidly rising expenses. TNG spent nearly VND725 billion ($31 million) on operating expenses, which rose 19 percent over 2017 to equal half of the company’s gross profit in 2018.

Unlike its parent company, two of TNG’s key subsidiaries have recorded much better results in 2018. Trung Nguyen Instant Coffee Company JSC and Trung Nguyen Corporation JSC reported revenues of VND134 billion ($5.75 million) and VND1.48 trillion ($63.52 million), up 36 and 28 percent year-on-year, respectively.

Their profits also rose significantly, an increase of around 180 percent for Trung Nguyen Instant Coffee and 60 percent for Trung Nguyen Corporation.

At the end of 2018, Trung Nguyen Group had total assets of over VND6 trillion ($257.42 million), with undistributed profits of nearly VND1.9 trillion ($81.52 million).

Trung Nguyen Group is a leading coffee firm in Vietnam. It was founded in 2006 by Dang Le Nguyen Vu, who is currently the company’s chairman. The coffee trading group began experiencing difficulties six years ago, when Vu and his wife, Le Hoang Diep Thao, fell out on how the corporation should be run.

Speaking to VnExpress this week, Vu admitted that their “internal conflict was an obstacle to Trung Nguyen’s growth”.

The post Vietnam coffee giant Trung Nguyen sees profits halved appeared first on Tin tức mới nhất hàng đầu Việt Nam cập nhật liên tục 24h.

Trung Nguyen Group - Tin tức mới nhất hàng đầu Việt Nam cập nhật liên tục 24h

Coffee giant Trung Nguyen opens new franchise

Trung Nguyen has opened E-Coffee, a small scale coffee shop franchise targeted at takeaway customers.

Vietnam coffee giant Trung Nguyen sees profits halved

Racked by an internal conflict, Trung Nguyen Group’s profit has declined continuously over the last three years.