Bakery/Café concept for Saigon, feedback/opinion/advice?

Rainville wrote:

Dear Expat community!

I'd love to have your feedback on a possible project in Saigon.

We're 2 friends who wish to open a European style bakery/café in Saigon in the next 2 to 4 years.
Concept would be a high end bakery/pastry shop with European quality products in a trendy/high end space.
We have experience in the production of high end products here in Switzerland with already one successful bakery. The goal would be to bring the quality bread/pastry making we have here and offer the experience to the Vietnamese public and expat community adding the trendy café style space where people could relax, work, network while munching on our pastries.

The setting as we see it would be a inside/outside café style space, with a relaxing seating space with lots of wood (bring the Swiss touch) and light (think white marble). Quality coffee would of course also be on offer.

Prices would be a tad higher than the current local bakeries/café without being outlandish.

Would you see a demand for such a place?
In Which district, 1 or more close to businesses and office buildings?
We're thinking Saigon, but Danang could be a location as well?
Are we delusional and heading for a wall?

it's a first step for us, testing the waters and any advice, opinion, feedback would be GREATLY appreciated.

Cheers to all of you.

Rainville.

First thought: Have you ever been to a nice Vietnamese bakery/cake shop?

The French influence is already big here.

Doesn't sound promising to me, but that's just my gut reaction.

Thanks for the feedback!

Indeed, competition would be the already implemented french type bakeries, although from my time in Saigon and what I could find online, I didn't really see any high end bakery/patisserie with a nice café interior.

The ones I found besides the usual PAUL Paris Baguette are Charm/ABC Bakery/Tous Les jours etc.

That's not really what we're aiming for and it doesn't seem like Saigon is saturated with european bakeries/café at the moment. Paul and Paris Baguette both offer products that feel highly Asianized (If I may) which is not what we're aiming for (maybe to our dismay)

Thanks again for the reply!

Rainville wrote:

Concept would be a high end bakery/pastry shop with European quality products in a trendy/high end space.

Quite a few people had that same concept already, made it happened, then found themselves closing shop shortly afterwards:  Heritage Concept Chill Hub, Almacén Arts & Café, and Nu Bistro are the most recently departed.  All of them had good coffee, good food, attractive decors, and competitive pricing.

Rainville wrote:

The goal would be to bring the quality bread/pastry making we have here and offer the experience to the Vietnamese public and expat community adding the trendy café style space where people could relax, work, network while munching on our pastries.

The setting as we see it would be a inside/outside café style space, with a relaxing seating space with lots of wood (bring the Swiss touch) and light (think white marble). Quality coffee would of course also be on offer.

There are so many cafes in Saigon that offer the same things already: inside/outside space, gardens with orchids, waterfalls, and serenity, indoors with plenty of outlets and charging stations for customers' devices, free WiFi, plenty of good pastries AND good food, good coffee, good tea, (Vietnamese drink more tea than coffee), ample opportunities to relax, work, network. date, or simply enjoy one's solitude. 

The only difference I can see in your scenario is white marble and I don't think that would make any difference.

Rainville wrote:

it doesn't seem like Saigon is saturated with european bakeries/café at the moment.

Actually, there are many European-style cafés everywhere, even after some of them went out of business: Palais Des Douceurs, The Dome, Maison Marou, Bason, M2C, M2C+, Une Journée à Paris, The Hidden Elephant, Café de la Poste, Bosgaurus, Chez Vous, etc.  I'm sure there are many more, I just don't remember right now.

Rainville wrote:

Prices would be a tad higher than the current local bakeries/café without being outlandish.

What exactly is "a tad higher without being outlandish"?  70K?  100K?  I wouldn't pay 100K for a cup of coffee.  That's 200K for my husband and me -- pastries would cost perhaps another 200K?  We're expats with good income (comparing to Vietnamese) and I can't see us spending 400K for coffee and sweets. 

Rainville wrote:

Would you see a demand for such a place?

A demand?  No.  Will you be able to survive?  Maybe.  Can you compete?  Not sure.

Since almost everyone can claim that his/her coffee and pastries are made of high quality ingredients, some shops use stimulants to stand out and lure in customers. 

No, not that stimulant. 

The newest concept for cafés and restaurants is colourful fish, koi in specific.  Koi underfoot, koi overhead, koi swimming next to customers' tables.  In fact, tables are placed inside a giant koi pond and customers are allowed to touch the fish.  Who cares about hygiene when FB Live Stream and Instagram are calling.

Most Vietnamese believe in 3 things:  1/ they can sing well;  2/ they're photogenic;  3/ they're good photographers.  I'm not going to comment on #1; anyone who lives here long enough can draw his/her own conclusion.   On #2 and #3, a successful business in Vietnam is one with Instagram-worthy property and decorations that allows customers to roam freely inside the business, camera in hand and photogenic loved ones posing nearby. 

Thus the koi, and the high gross sales those places bring in at the end of the day.  I'm not saying you should have koi, just want to bring up the tiny fact that as there are good coffee shops in almost every block, good coffee and good pastries are not enough to keep a shop's door open, European style or not.

There are so many things to make or cut a business.  Open a café in a country where there are already more cafés than coffee drinkers is not what I would call a good business idea.

Thanks for the detailed feedback! Lots to think about indeed.

I understand that Saigon is filled with cafés with nice interior design. Where I thought we could bring something new is more to fuse 2 concept: the Paris type high end bakery coupled with the instagram worthy trendy café.

The coffee wouldn't be the main product, baked goods and pastries would be our selling point, made as we do them here in Switzerland where we've got a pretty good reputation.
Goal would be to add to the bakery the café/trendy space and blend the 2 together.

I'm very sorry if i'm not clear about the concept. And if I'm clear enough and your points stands about shops who already tried and failed that concept, then I'll continue my research for sure . That's why I'm here.

Again, thank you for the constructive feedback.

To be honest, if you really think it will work, give it a go.If you have deep pockets and can afford to lose a few hundred thousand dollars, it's your choice.

I also believe it will fail,as there is so much competition. Another point is staff, staff here are terrible. Having owned a business here for two years I would never do it again. I don't think you know what you are getting into.

This is somewhat peripheral to the discussion but here goes.  One of the first assumptions of the OP is that European bakeries are superior to those in Vietnam.  I do not particularly like sweet pastries so do not have any real experience with such in Vietnam.  I have however had ordinary baguettes in both Paris and Ho Chi Minh and consider the Viet version superior.  I think it may be a difference in the flour.  Viet bakers may be using flours from soft wheats which grow in more southern climates and The Parisian breads are likely made from hard winter wheats.  Hence the Vietnamese baguette has a fluffier inside texture than the French original form.  Anyway just my 2,000 VND even if 

Rainville wrote:

Dear Expat community!

I'd love to have your feedback on a possible project in Saigon.

We're 2 friends who wish to open a European style bakery/café in Saigon in the next 2 to 4 years.
Concept would be a high end bakery/pastry shop with European quality products in a trendy/high end space.
We have experience in the production of high end products here in Switzerland with already one successful bakery. The goal would be to bring the quality bread/pastry making we have here and offer the experience to the Vietnamese public and expat community adding the trendy café style space where people could relax, work, network while munching on our pastries.

The setting as we see it would be a inside/outside café style space, with a relaxing seating space with lots of wood (bring the Swiss touch) and light (think white marble). Quality coffee would of course also be on offer.

Prices would be a tad higher than the current local bakeries/café without being outlandish.

Would you see a demand for such a place?
In Which district, 1 or more close to businesses and office buildings?
We're thinking Saigon, but Danang could be a location as well?
Are we delusional and heading for a wall?

it's a first step for us, testing the waters and any advice, opinion, feedback would be GREATLY appreciated.

Cheers to all of you.

Rainville.

Were you planning to set up a bakery shop as  European style or Europ stander? So you are planning to bring all material from Europ to make bread and sell to Local? Who will be your target customers? As you said, you have abundant knowledge about the bakery then why you don't try it according to local concerns first?

THIGV wrote:

This is somewhat peripheral to the discussion but here goes.  One of the first assumptions of the OP is that European bakeries are superior to those in Vietnam. .... Anyway just my 2,000 VND even if 

It's definitely not off topic.  I had the same observation as you did about the assumption, typed it out, included it in the first part of my reply, then deleted it because I didn't want to start a discussion on who makes what better than anyone else.

I tend to agree with others and think your concept is not unique enough. Have you thought about combining your cafe with an English school, possibly including some other languages?

Anyway, the best thing to do is conduct some extensive market research and revise your approach accordingly.

Another idea is to change location. Have you looked into opportunities in other cities or in the suburbs, where you may enjoy lower costs and less competition?

I'm trying to figure out how someone could start completely cold and purchase or lease a large enough spot in a "trendy" part of District 1 to have indoor and outdoor seating and even have a slim chance to cover just the rent payment peddling coffee and pastries.

Ciambella wrote:

.....I didn't want to start a discussion on who makes what better than anyone else.

Good point.  I might have elaborated but whether one feels that the lighter Vietnamese baguette is superior to the heavier French one or the opposite, it may not be a matter of the skill of the bakers but, as I said, the available ingredients.  Bánh mỳ nhỏ made in Hawaii by Vietnamese bakeries range from terrible to fair, but none are as light at those sold in Vietnam.  I am fairly sure the difference is the type of flour.

Rainville wrote:

We're 2 friends who wish to open a European style bakery/café in Saigon in the next 2 to 4 years.
Concept would be a high end bakery/pastry shop with European quality products in a trendy/high end space.
We have experience in the production of high end products here in Switzerland with already one successful bakery. The goal would be to bring the quality bread/pastry making we have here and offer the experience to the Vietnamese public and expat community adding the trendy café style space where people could relax, work, network while munching on our pastries.

Prices would be a tad higher than the current local bakeries/café without being outlandish.

Your goal, as far as I can see, is to have a high end and trendy place, as the terms were used over and over in your post. 

Let's forget about everything else and just talk about those 2 terms:

- Trendy means pertaining to the latest trend or style. 

The European café was trendy in Vietnam pre 1975 when I belonged to the crowd of young adults who hung out at European cafés every day after class (college, not high school -- and yes, I'm that old).  Back then, life was much slower, the value of Vietnamese money was much higher, jobs were not scarce, and ALL high school graduates/college students could speak two foreign languages (many of us could easily  converse with war journalists -- who also hung out at the same cafés -- in their languages.)  During the 2000s and 2010s, the trend came back only to fade away, causing some very good cafés to close shop. 

It's 2019 now.  The trendy thing with the young adults (those were and still are the group ready to spend money on trivial things) has nothing to do with European coffee shops.  Remember I said Vietnamese drink more tea than coffee?  The younger Vietnamese and their trendy parents drink neither.  It's trà sữa they're after.  In the beginning, it was cheap trà sữa from Thailand, then their taste improved and they moved on to Japanese and Taiwanese. 

There are Japanese coffee and tea shops everywhere that offer them good drinks, good vibes, good decors, and good places to be trendy. 

Gong Cha from Taiwan charges 1B (billion) VND for franchise fee, and guess how many locations there are throughout Vietnam?  48.  That's 48 people with money to open a trendy place for people to hangout, and they placed their bets on a Taiwanese coffee/tea/ice cream/cake shop.  They knew what they were doing.

Your goal is to open in 2 to 4 years.  That's between 2021 and 2023.  Right now, your idea of trendy is already passé; who knows what will be trendy 4 years from now?

- High end:  You said: "We have experience in the production of high end products here in Switzerland with already one successful bakery."   

There are more than 9500 km between Switzerland and Vietnam.  The difference between the two countries is a lot bigger than those kms.  The monthly minimum wage for unskilled workers in Switzerland is almost 3000€, and they can live on that salary.  Depending on the region, the monthly minimum wage for unskilled workers in Vietnam is 2.9M - 4.1M (110€ - 150€), and the government acknowledged that it "only meets 65-70% of the minimum living standard of workers."  Think about it. 

Also, the Swiss eat baked goods daily while the Vietnamese eat rice and noodles.  Pastry is an occasional treat, not part of the budget or daily nutrition here.

Expats in Vietnam, even with their good income, do not spend money the way they did in their home countries either.  Remember I said I wouldn't pay 400K (15€) for the two of us to sit somewhere having coffee and a pastry each?  Your customers at your Swiss bakery wouldn't blink at that amount, but as that's half of what my husband and I pay for our occasional big date at a French restaurant here in VT, I would never spend it on coffee and pastry.

As you include the "Vietnamese public" in your customers, do you think they would spend that amount regularly just to "relax, work, network while munching on [your] pastries"?

You need a lot of adjustments in your thinking, and I'm saying it sincerely.

Woah, waking up and lots to read about 😊 ! A lot of good advices and thought out concerns.

Before I quote and answer some of the above, I’d like to say that the project is in its real infancy and posting the proto-concept here was the first baby step. Point is to test the waters and learn from your views.

I don't think you know what you are getting into.

Well, that's where research comes in. I did live and work in China (Shanghai) for 4+ years and been travelling in SE-Asia for the past 15 years extensively and have some friends with successful businesses (F&B) in Saigon and Hoi An. It doesn't mean I know what I'm getting into but I'm not completely blue either.

“European bakeries are superior to those in Vietnam.  I do not particularly like sweet pastries so do not have any real experience with such in Vietnam.  I have however had ordinary baguettes in both Paris and Ho Chi Minh and consider the Viet version superior.”

Although I agree that Vietnam has a vastly superior bread making than its neighboring countries, I do think there is a place and public for European style bread and pastries. I’ve been to Vietnam a few times now and loved the Banh Mi, I still find the crust of the bread a bit flaky. Now taste buds are of course subjective.

Were you planning to set up a bakery shop as  European style or Europ stander? So you are planning to bring all material from Europ to make bread and sell to Local? Who will be your target customers?

Indeed, the first thought would be to bring in our hard materials (equipment) from Switzerland. Target customers as a first thought would be expats, students, white collars.

I tend to agree with others and think your concept is not unique enough. Have you thought about combining your cafe with an English school, possibly including some other languages?

For now, we didn’t think about branching that much outside of the basic F&B concept but it seems like we’ll have to brain storm a bit more 😊. Thanks for the idea!

Anyway, the best thing to do is conduct some extensive market research and revise your approach accordingly.

Will do! Expat.com forum was the first step in a long line of research. I was looking for some initial feedback, which I got ten-fold

Another idea is to change location. Have you looked into opportunities in other cities or in the suburbs, where you may enjoy lower costs and less competition?

District 1 wouldn’t be per se our first choice, especially because of rent prices. I have a friend who had a restaurant/wine shop in D7 which could also be an option for the 1st location.
Also, Danang is an option, in 2/3 years this might be the better location for such an adventure.

There are Japanese coffee and tea shops everywhere that offer them good drinks, good vibes, good decors, and good places to be trendy.

Yep, Japanese/Korean influence is the big thing right now in SE-Asia. Thankfully, their expertise in the boulangerie business isn’t exactly the same as what we do in Europe. They do amazing product, but croissants aren’t really their forte I think 😊 (pls don’t take this too seriously).

Your goal is to open in 2 to 4 years.  That's between 2021 and 2023.  Right now, your idea of trendy is already passé; who knows what will be trendy 4 years from now?

Indeed, but we must start somewhere with our research.

As you include the "Vietnamese public" in your customers, do you think they would spend that amount regularly just to "relax, work, network while munching on [your] pastries"?

In no way we are expecting the shop in Vietnam to price the products similarly to our Swiss shop. Price would be competitive with what is been done locally of course. But pricing is something that would come up quite a bit later in our current timeline. We’re merely at the concept part and there seem to be quite the amount of work that needs to be done on that part already 😊.

You need a lot of adjustments in your thinking, and I'm saying it sincerely.
Yes, and part of it starts here.

Thank you all for taking the time to answer and let me know your view on our first concept. Lots to be done and adjusted, but that’s the exciting part !