Vietnam is a country of opportunities – One of the long-known statements many of us may or may not have heard before.
As an entrepreneur bouncing around countries over the years, I agree, and there are proven points for that.
The advantages of running a business in Vietnam
Firstly, Vietnam has a growing economy. The constant growth in manufacturing, the resilience of some industries during the pandemic, and the development in the mindset of young people in Vietnam attract FDI in the US and Asian countries like Japan and Korea.
Big companies are pouring in billions of dollars annually to sustain their factories and invest. Moreover, Viet Kieu entrepreneurs and Gen Z coming back to Vietnam to seek opportunities in the business field and career advancement.
I made a video about the pros and cons of doing business in Vietnam, all the red-tape, things you must be aware of before starting an entrepreneurial journey. Hope it helps!!!
To learn more, check out these resources about company incorporation in Vietnam.
Secondly, the infrastructure of Vietnam is rapidly reaching the next level. International standard, high-end real estate projects began to show up everywhere in Ho Chi Minh City, known as the economic hub of Vietnam. Just a couple of blocks away, you may see top-notch skyscrapers or central malls and luxurious condominium projects developed by renowned real estate developers like Vingroup, Novaland, or Hung Thinh. Those are the advancements of Vietnam in the year 2023. It’s no longer the small houses that may seem to tell little difference between the countryside and the urban areas.
You also have a developing traffic system here in Vietnam. Even though traffic jams still exist (mostly every day), it’s not so much of a problem once you get used to them. The development of traffic is still in its early stage. The MRT system in District 1 of Ho Chi Minh City or the Skytrain system that is still under construction prompts the change in direction to apply other forms of public transport to reduce air pollution and heavy traffic.
However, such has yet to replace motorbikes anytime soon. Motorbikes in Vietnam, to most people, are here to stay. It’s just so much more convenient compared to other forms of transportation. Such could be an advantage to many entrepreneurs when coming to Vietnam. The infrastructure development in Vietnam is receiving a lot of support from the government across the country.
Thirdly, if we compare the US to Vietnam, I’d say that for those who want to start a business on a budget, Vietnam is better than the US because you can easily start a business with only around 10,000$ – 15,000$ (from an invested capital perspective), or even less.
Finally, Vietnam is one of the best “China + 1 strategies” to manufacture goods. That’s why there’s a huge demand for locally-made and imported products. If you have a unique idea and can manufacture it, come to Vietnam, do your due diligence, see if the market fits, and take off. Regarding the local demand and in terms of interest from Vietnamese people into foreign goods, what I have observed over the years is that Vietnamese love consuming products, all types of products.
The cons of starting a company in Vietnam
We cannot deny that Vietnam has some weaknesses that it needs to improve.
The first weakness that comes to mind is the visa. The visa rule finally changed recently, switching from the 1-month tourist visa to a 3-month tourist visa, which may help people changing their minds about staying in Vietnam long-term to run a business as they can spend more time to explore business opportunities prior setting up their company.
The second disadvantage is the foreign ownership regulations. Vietnam is strict on what types of business foreigners can hold 100% ownership. If yours falls under the group of disapproval, you need a Vietnamese to run it with you. It’s great that you can find someone you trust. However, if you’re unsure about whether to trust one or not, such could be difficult to overcome.
Third, Vietnam is still a developing country, meaning that there will always be many restrictions that are out of hand. You will need to spend time studying the country before you can come here to be a part of it.
Finally, every process is lengthy with a lot of paperwork and documents, which could lead to confusion. But along with that is ambiguity, working with an English-speaking law firm or business advisor may be a help for you to fully understand the pros and cons prior starting your venture in Vietnam.
Therefore, I’d suggest you get in touch with a legitimate business advisor to get you off the risks. If you’re still unclear about how to start, you can actually get a 15-min free consultation from one of Movetoasia’s legal consultant. You will get some insights on a legal perspective and get a tailored consultation for your situation.