By Guillaume Rondan
Vietnam has been a well-known attraction to many foreigners around the world. Many come to spend their holiday, to experience a different culture, or to open a business of their dreams.
Many have come up with the idea of opening their own business in countries like Vietnam because everything seems to be pretty much affordable here. Even when it seems to be obvious that you have to have a certain budget for your business it doesn’t need your entire retirement savings.
Many foreigners have come here to express their business ideas. Most of them hit the jackpot right after they pulled it off. It’s because the country is on an improving trend. Therefore, demands for lots of things grow which requires an equal amount of supplies. Solely local people will never be able to make that happen. Having extra help from foreign investors and entrepreneurs will aid the growth of the country.
However, what seems like an opportunity always comes with some challenges. One obvious obstacle is the regulations for foreign business owners. But, a more commonly asked question that I usually get from my audience is: What business ideas should I pull off in Vietnam? Since the market here has different demands compared to their home country, it might take extensive research to catch up with the situation here.
So today, this article serves the purpose of making the work a bit easier for you. As a foreigner having more than five years of moving and working in Vietnam, I’ve had a decent deal of knowledge of the functions of a communist country. Therefore, these five business ideas, I believe, are the best to be applied based on how the country has developed over the years.
Food and Beverage (F&B)
Vietnam has gone through massive growth in F&B when more Western restaurants were brought into the country (Such as KFC, McDonald’s, Starbucks, …) as franchise restaurant chains by businesses in Vietnam. This has changed the consuming habits of many people since these F&B brands have given Vietnamese more options to choose from.
There are more than 540.000 F&B businesses in the country. 430.000 of which are small businesses. The minor portion includes 7.000 fast-food restaurants, 22.000 coffee shops and bars, and 80.000 well-known restaurants that are heavily invested. Over the years, these numbers have grown significantly.
Also, the bubble tea market in Vietnam has attracted many popular bubble tea brands in Southeast Asia. According to Euromonitor, this market in Vietnam grows by 20% every year and since 2016, it has reached 282 million USD in value.
Also, there’s a huge advantage for those who want to open an F&B business in Vietnam: Vietnamese people love enjoying new cuisine that they’re not familiar with. The people here don’t always go after the renowned F&B brands that most would normally choose. They choose to support a brand if it serves the needs of the customers. For example, look at the story between the traditional coffee of Vietnam and Starbucks. Starbucks may seem to be doing fine but compared to the original flavour created by the Vietnamese, a lot is showing that Starbucks doesn’t have things that satisfy Vietnamese coffee lovers.
Therefore, if you’re someone with a good understanding of F&B and you believe you can conquer this market in Vietnam, opening an F&B business is a profitable model.
Most locals usually start by opening a small coffee shop or an eatery mainly focusing on making the cuisine of their origin. As a foreigner, you can offer the people here your home country’s flavours. It’s a good way to introduce to the people around your culture. Moreover, it might be a big plus to grow your brand and create an empire here.
Garment and textile
This is one of the advantages that make Vietnam stand out from any other nation. It’s known as one of the most profitable business ideas. As products made in Vietnam are usually exported to other countries, the scale of this industry in Vietnam is so huge to a point that it has become a critical aid to the growth of a country’s economy.
The Us-China trade war has created an opportunity for Vietnam to become a serious competitor in this sector. Since the country has given a competitive price for its products, there’s a high chance that Vietnam could become a special partner to the US in textile and garment export.
You can start by opening an online clothing store with ready-made products or becoming a cloth merchant. There’s just one weakness in this business idea which is the cost of starting one might be exceedingly costly. However, if you’re looking forward to pulling off large-scale projects like this, you won’t be disappointed later on because the earnings of this sector are guaranteed and worth your effort.
A lot of businesses have chosen to digitize their company operation because it’s a more efficient way to manage everything. It’s less time-consuming and more productivity-oriented. Thanks to the help of digitalization, many companies have gone from zero to their desired point in just a very short time.
There are different types of digital agencies that you can look up and decide which one suits your profession. The 2 most common ones are digital consultant agencies and software development agencies.
For the digital consulting agency, the key responsibility is to help those who want to digitize their business by having a website or running online ads for better traffic. A lot of potential businesses lose the opportunities that they deserve because they have no clue how to run a business digitally.
A software development agency focuses on building computerized programs for businesses to help them manage and improve their company both inside and outside. For example, the timekeeping process in a lot of companies is still manual. The staff or a person who is in charge has to fill in the information of each working day by hand. This always leads to confusion as it’s hard to keep track of whether someone is at work or not. Therefore, building a timekeeping app is a lot more efficient than the traditional attendance sheet. There are all kinds of tools on the app which make the job a lot easier to keep track of and quicker to finish. The number of companies in Vietnam that begin to apply this to their business has grown significantly over the years.
This business model is becoming more popular. Especially when the demands for outsourcing are growing, the potential for this idea is expected to expand a lot more in the upcoming year. Vietnam is gradually approaching the point to become a developed country like those in the West.
Remodelling and making furniture
This sector has only become a booming sector recently since the number of middle-income families began to increase significantly. More households are now having more interest in renovating their living space. Therefore, they want to make things a bit different from the traditional in-house look in the past. Especially during this time when WFH (Work From Home) are becoming more popular, many find it necessary to re-decorate their environment and turn it into something enjoyable.
Also, wooden furniture has become the focus since many countries have been importing furniture from Vietnam, especially stuff made from rare hardwood or rosewood. 70% of these are exported to China.
To open a business in furniture making and remodelling, there are plenty of ways that you can carry this out. If you have ever had any experience in decorating, being a furniture consultant can be an ideal first start as it doesn’t cost much to open your own office. You don’t have to worry about manufacturing the furniture since you can outsource a company to do this for you or find yourself a partner specializing in producing household appliances.
Vietnam has been known to export a lot of things and export is one of the biggest industries that creates a huge profit for this country.
Clothing, accessories, coffee, and garments are some of the most commonly exported items. Other goods such as mineral fuels and oils, manufacturing equipment, steel and irons, are also the main factors that make Vietnam be in the focus of import spots for many countries.
Becoming a Product Sourcing Consultant can help you start in the beginning. You can match potential sellers in Vietnam with international customers. By that, you can expand your brand awareness to the public and improve your business scale.
Many people might think opening a business in a communist country like Vietnam can be a risky move. However, it’s never been the case as Vietnam encourages foreign investors to come so that its economy can be more versatile and diverse. With a lot of FDI (Foreign Direct Investment) over the years, it’s worth getting into the booming opportunities that Vietnam has to offer.
About the Author
Guillaume Rondan is a French expat living in Vietnam for 5 years. He owns online businesses and is the founder of Movetoasia.com, a like-minded community helping expats how they can live in Asia to the fullest, find a job, incorporate businesses or invest to thrive in the next 5-10 years.