Trung Nguyen Corp. to Rival Starbucks

Trung Nguyen Corp. to Rival Starbucks

After Starbucks Corp., the world's biggest coffee shop chain recently opened in Ho Chi Minh City on February 1, Trung Nguyen Group Corp., Vietnam's biggest coffee retailer, now plans to buy bean roasters in the United States and open branches in Seattle, New York and Boston.

Dang Le Nguyen Vu, founder of Trung Nguyen Corp., stated that the company is planning to fund U.S. acquisitions by selling a stake as high as 15%. This bold move came after the company became the biggest roaster and packaged-coffee retailer in a country where brewing is a tradition that dates as far back as the 19th century in French-colonized plantations. Trung Nguyen has 60 branches all over the country serving Vietnamese-style individually brewed cups, as well as international varieties including Italian expresso and Turkish-style coffee which the company also plans to introduce into the American market.

Vu is the son of a farmer who established Trung Nguyen Corp. in 1996. He is the company's sole owner. And in his vision to expand his products into the U.S., his goal is to let Americans taste and appreciate authentic coffee. Vu specializes in specialty beans and roasting. Among these is “Legendee,” a variety which was especially created to simulate the flavor of coffee brewed from beans recovered from the waste of civets, a weasel-like rodent. Civet is considered a delicacy, even a luxury.

The company's discovery of the “magical” enzyme jacked up its sales significantly to 32% in 2012, or a total of $200 million in sales. It's expected to double next year, and even estimated to reach $1 billion by 2016. There is a specific increase in demand for Legendee in China and Southeast Asia. Vu intends on building a global brand and a coffee empire to compete with the current world's number one in coffee, Starbucks.

Dang Le Nguyen Vu was a medical student before starting his coffee business. He established Trung Nguyen Corp. from a small shop into a coffee retailer with over 3,000 employees. It has currently five branches in Singapore, and Vu plans to raise the number of shops operating in Vietnam to 200 in the next two years. And though Starbucks is planning to open hundreds of its own in the country, Vu is confident that he will be able to rival the coffee giant with a carefully-planned vision that he prepared for three long years.

In order to make their entry into the American coffee market push through and succeed, Trung Nguyen Corp. will team up with partners and investors which are given initial 15% stock buying options, increasing up to 30% in the next 10 years. In fact, the company is already in negotiations with big players in the industry though Vu didn't mention specific names. The company's latest coffee shops in Vietnam are similar to Starbucks, with big, accomodating chairs; modern music; bookshelves filled up with inspirational books; and a wide menu offering more than coffee.

Though analysts are optimistic about Vu's grand vision, some are skeptic, stating that it takes more than a dream to make such a grand scheme materialize. Emphasizing that the American market is big and quite difficult to penetrate, it will take a lot of money, knowledge and connection to make Vu's dream plan become a vision. But Vu, more than ever, is confident that Starbucks has lost its original luster and his company Trung Nguyen will take the next crown in the reign of coffee.