Sourcing in Vietnam : the ultimate guide for 2024
Is Vietnam one of the potential countries in manufacturing and sourcing ?
Vietnam is one of the fastest-growing economies in Southeast Asia. Over the years, we can see how much Vietnam has improved. It was from a country that had nothing and was facing massive destruction of famine, poverty, and political conflicts, to a country that is now a part of the global market for more than 30 years.
Vietnam has many sectors. Textiles, electronics, and agriculture are the crucial components that make Vietnam an integral partner to other countries in Europe and Southeast Asia. That’s why the manufacturing and sourcing industry in Vietnam receives a good reputation, making it a crucial piece in the global market to sustain a powerful resource of exports to other countries.
And this will be the topic of today. We’re going to look into how the manufacturing and sourcing industry in Vietnam has been doing so far. Moreover, if you want to contribute to such a crucial part of the country, this article will support you in some ways with updates and information.
Supply crisis and challenges in sourcing in Vietnam ?
Due to the recent outbreak of the Delta Variant in Vietnam and the strict lockdowns, the exodus of factory employees who have gone back to their home villages impacted the whole Vietnamese manufacturing supply chain. Experts are already projecting that the outputs from Vietnam wouldn’t normalize until the middle of 2022.
This video highlights some of the main concerns, challenges and solutions if you want to source products in Vietnam during this global supply crisis.
The best products to manufacture in Vietnam
Vietnam manufactures a massive product range and exports them to other countries in the world. The list includes Clothing and textiles, plywood,flooring,footwear, consumer goods, plastic and rubber goods, furniture, packaging, coffee, electronics, construction materials, wooden goods, and Iron and steel.
Those are the areas that made the most contribution to the economy of Vietnam in 2021. By far, electronics, footwear, and textiles are on top of the list.
Where do you find products in Vietnam?
Each industry has a specific industrial area. If you tend to focus on one particular product, you should conduct quick research to see where you can exploit a decent amount of resources to serve your purposes.
To attract more Foreign Direct Investments, the country has established more than 220 industrial zones and 16 economic zones that benefit foreign investors greatly. Those benefits include:
- 10% tax rate that is locked in for fifteen years
- a 50% tax benefit for employees
- 4-year 0 corporate taxes
- A discount of 50% corporate taxes for up to nine years after a business has reached the first 4 years
Vietnam is a potential market
After the US-China trade war, Vietnam began to receive more attention from many well-known corporations such as Apple and Samsung. The proof is when the factories of the companies began to relocate out of China due to trade war conflict. Such a great opportunity opens a brand new door for Vietnam to welcome new partnerships and embrace the upcoming progression of the economy. EuropeanBusinessReview insights about manufacturing in Vietnam highlight how Vietnam will still be one of the top leaders in 2023 for companies to source, manufacture and export.
Also, Vietnam is an attractive destination for foreign businesses because it offers beneficial advantages. Firstly, the labor cost in Vietnam is one of the lowest in Southeast Asia. Secondly, Vietnam has a skilled and well-trained workforce that is qualified for different demands. It has never stopped learning from other developed countries to maintain the strengths of its workers and improve other areas that are required when working in an international company.
