International Delivery Firms Booming with Business in Vietnam Creating Jobs

Next Story

The Improving Business Climate in Vietnam

The online shopping industry has created a gold mine of business and job opportunities for international delivery firms shipping to and from Vietnam.

Fedex, UPS and DHL have spent big money on the Vietnam market, and those investments have been increasing rapidly. The rapid increase in imports and exports has also helped logistics companies grow.

A General Department of Customs report shows that import-export turnover in the first eight months of 2017 reached $270.91 billion, an increase of 20.9 percent over the same period last year.

In April 2017, United Parcel Service (UPS) launched two major initiatives to enhance operations: upgrading services in northern, central and southern Vietnam (19 provinces) with extended pick-up times for export shipments by up to 3 hours, and partnering with Indonesian freight airline Cardig Air to improve by 1 day in transit for both export and imports to/from Europe and parts of Asia.

A senior executive of UPS Vietnam said delivery service providers have been put under increasing pressure. They need to provide products and services in larger quantities, with higher quality, and they need to deliver more quickly and offer lower service fees. By shortening shipping times and extending delivery cut-off times, clients will have more time for production, shippers can support more orders.

After Vietnam joined WTO and fully opened its market, foreign express delivery firms flocked to the country. These include DHL from Germany, TNT from the Netherlands, FedEx and UPS from the US.The firms all follow a two-step strategy. At first, they cooperate with Vietnamese companies to set up joint ventures. With strong financial capability and international brands, they can easily conquer the market. Later, they quit the joint venture model and became 100 percent foreign invested enterprises.

TNT joined the Vietnamese market by teaming up with Viettrans to set up a joint venture. Meanwhile, DHL set up a joint venture with VNPT in which it held 51 percent of capital. As the firms showed good business performance, FedEx and UPS also headed for Vietnam. UPS terminated the joint venture model and established UPS Vietnam, a 100 percent foreign owned company.

Experts believed at the time that the presence of international delivery firms in Vietnam will not be a threat to domestic service providers, because the firms would focus on international services, which was not the advantage of Vietnamese enterprises. Vietnamese enterprises mostly targeted the domestic market. However, the recent moves by foreign delivery firms show they are taking strong action to conquer the domestic market.

More From the Author

  • Vietnam to Host 2019 U.S.- N.Korea Summit
  • Key Facts and Figures of US-Vietnam Relations
  • Happy TET 2019 Year of the Pig
  • A Bright Future for Baseball in Vietnam
  • Happy Holidays from Vietnam!
  • 500 largest enterprises in Vietnam
  • Adventure, Science and Research defined Dr. Alexandre Yersin
  • French PM visits Vietnam
  • E-commerce is booming in Vietnam
  • Vietnam jumps to 45th place in Global Innovation Index
  • How is changing lives
  • US-based Private Equity firm to establish real estate investment fund in Vietnam
  • Hanoi to host International Real Estate Conference
  • Tourists flocking to Vietnam’s idyllic sand sculpture park
  • First Solar Power Purchase Contract in Vietnam is Signed
  • FutureDocs Abroad Meet in Hue, Vietnam
  • HOSE releases updates for VN30 basket
  • Super Foods are Replacing Rice
  • Vietnam Students Win 3rd Place at Intel Competition
  • Pacific Horizon Pictures Slates Vietnam Film with ‘Crazy Rich Asians’ Producer Ivanhoe
  • Leave a Reply

    Subscribe Today

    We will send directly to your inbox the latest Vietnam investment commentaries, travel tips and "in the know" tidbits! 
    Join the Vietnamese IN CROWD!
    First Name
    Email address