Manufacturing and Sourcing in 2022: Is Vietnam a Good Choice?


As one of the most developing countries in Southeast Asia, Vietnam gradually becomes the focus of other counterparts in the global market. It has one of the toughest resilience to get to the position it is today. Vietnam was far from an international nation to a member playing along with other powerful countries in the region. The country does not only prove its strongest suit which is agriculture but it also shows to the world that it’s capable of expanding further. Such could be seen in many other sectors such as IT, fashion, engineering, textiles, wooden products, etc.

Bordering China, Vietnam shares the same expertise in manufacturing. Since China has become overcrowded over the past few years, big companies like Apple and Microsoft have decided to move their factories to Vietnam for the availability of land.

Every factor in Vietnam, either owned by locals or non-local owners, benefits significantly from its location on the map. Since Vietnam is so near China, it can easily outsource the materials and ingredients available in China to sustain businesses. Another thing is that the location of Vietnam to China is so convenient. It’s known to cost six times less when shipping by sea route. Therefore, there’s always an ideal trade port that every business can easily manipulate to lower the cost of delivery.

Moreover, two other astonishing strengths of Vietnam draw the attention of many countries:

  • The low labor cost
  • Skilled and trained workforce

When choosing to open a factory in Vietnam, those are the benefits that you will receive. However, in this article, we are not going to entirely talk about the benefits of manufacturing and sourcing in Vietnam. We will discuss in detail the pros and cons of Vietnam, the difficulties, the products to produce, the solutions to get through the difficult time, and the right way to get started.

The best range of products to manufacture in Vietnam

According to’s research paper, Vietnam had made some impressive achievements in exports in March 2021 when there was an uplift in the increase of the country’s economy.

The electronics industry including computer and cellphone components, household electronic devices made a success when it created a huge uplift of almost 10.000 million USD in total, making itself the most outstanding industry in March 2021. Other sectors such as footwear and textiles remain at a decent pace, making 1.392,5 million USD and 2.338,6 million USD respectively.

Other sectors have gained quite a success in March 2021 and made it to the top 10 list of products manufactured the most in March 2021 which include steel industry, seafood, transportations, wooden products, and other types of products.

Therefore, if you look forward to carrying out a manufacturing factory in Vietnam, those are the most recommended to not only contribute to the economy but also be a profitable business for yourself.

How far has Vietnam gone to become a potential factor in the global market?


If we compare Vietnam and China from 2 to 3 years ago, it’s no doubt that China was easily winning the race to become the best manufacturing hub in the region. There are criteria to choose a manufacturing channel for a business. There are probably more than a hundred factors that may affect your decisions. However, we will only look at these seven main points.

Speaking of the cost of labor, nowhere else is more affordable than Vietnam at the moment. The wages in Vietnam are two times lower compared to China. It’s a huge advantage that has attracted many international businesses to come into the country and open their factories. Another biggest strength of Vietnam is the culture of hard-working. If you choose to place your factory in Vietnam, you may likely see higher stats or productivity. Such could be higher than China at times (depending on the sufficiency of the workforce). Also, the bureaucracy of Vietnam is a lot more welcoming for foreign investors.

However, there’s a bit more for Vietnam to get ahead of China if the country wants to become the manufacturing hub in the region. In terms of infrastructure, product complexity, access to raw materials, and the number of workers, Vietnam is still a bit behind. Especially the number of workers that Vietnam has compared to China, it’s challenging for Vietnam to compete with China over such matters because the population in this country is 15 times more than Vietnam. Also, China has been the core of this industry for a while, it will be challenging for Vietnam to get to the top spot.

Luckily, since the trade war between China and the US made it difficult for China to sustain itself, Vietnam became the hot spot for international companies to move their factories to Vietnam. Such prompts Vietnam to get prepared for whatever is coming. Especially after Covid becomes less of an obstacle, there will be more positive trends to come. Therefore, Vietnam must prepare to welcome its new guests once everything gets back to normal.

The supply chain crisis and suggested solutions

Covid caused a delay in global trade and a supply chain crisis not only in Vietnam but everywhere. The virus originated from China and forced the country to shut down many of its factories to secure safety. Such affected Vietnam as well because Vietnam couldn’t get the raw materials from China. Also, the ongoing lockdown in Vietnam caused many big automobiles factories in Vietnam like Toyota, Honda, and Ford to stop working for a very long time. For now, things have gotten back to normal again. But it will take much more than just effort for many businesses in Vietnam to get back on their feet.


There are certain ways that businesses can adopt, along with the adjustment in regulations in Vietnam, that will establish a positive impact on the growth of the economy of not only Vietnam but also the benefits of the businesses.

Diversification is one good way that businesses should consider pulling off. Since big companies such as Samsung and Apple have been doing it for a while, it will be a wise move for others to adopt this method.

Also, investing more into your online distribution channel is a must. Face-to-face services and online services may have to operate at the same time to maintain stability. In the future, mortar-and-brick stores will still play a crucial role in profiting. However, online channels will keep your business active and flexible to answer your customers’ demands.

Lastly, instead of shutting down your business for a while, try to cut down some less critical expenses to sustain during the time. Restarting may cost more than slowly recovering what was temporarily cut down. Budget math could be a challenging exercise. Therefore, make sure you keep a cold head and stay calm when the situation gets worse.


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