1. Professional Sourcing Club
Alibaba.com
Sourcing Intelligence Series – Vietnam
November, 2011
Prepared by Allan Yau & Thuy

2. Sourcing Hub Service
Meet pre-screened suppliers in one day in one of the 17 Asian
industrial Zones (Sourcing Hubs)
Meeting with Suppliers
Market Intelligence Pre-trip Arrangement
Package A: Meeting with
suppliers in local office Acquire sourcing tips from Leave all transportation
our expert team on: arrangements to us:
Package B: Meeting with - Market information; - hotel pick up;
-Sourcing tips; - Alibaba.com local office;
suppliers & factory visit
More Information: http://www.alibaba.com/sourcinghub
please apply here

3. 17 Sourcing Hubs
please apply here

4. Contact Us
Michael Mang
Senior Manager
http://buyer.alibaba.com/
Skype: michaelmang1119
Email: michaelmang@hk.alibaba-inc.com
Direct line: 852-22155233
Mobile Phone: 852-98455407
China Mobile: 86-13732292872
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5. Content
 Country Profile
 Alibaba.com in Vietnam
 Tips in Doing Business in Vietnam

6. Vietnam - Benefits for International Trade
 Geography
– Strategic location: Asia Pacific region gateway to the world
– Long coastline: over 4000 km
– Convenience seaport
 Labor force
– Young generation
– Low labor cost compared with other countries
– Hard work and skillful worker
 Market openness
– Trade relation with other countries
 Natural resource
 Key Government bodies in promoting export activities

7. Vietnam
 Vietnam today is a country undergoing
continued development at a rapid pace.
While the old image of Vietnam lingers in
history textbooks, today’s Vietnam is
increasingly being shaped by a dynamic
young population. With change comes
new technology, new ideas, and new social
issues

8. Vietnam Capital
 Hanoi Capital website:
http://www.hanoi.gov.v
n - Hanoi is the capital of
Vietnam. It's a wonderful
city.

9. Vietnam Economic Hub
 Hochiminh City website:
http://www.hochiminhci
ty.gov.vn - Hochiminh
City is an economic hub
of Vietnam, a dynamic
city. It's very good if you
can get more
information about this
city, where your first
business trip may come
here.

10. Climate
 Vietnam is located in both a tropical and a temperate zone.
 It is characterized by strong monsoon influences, but has a
considerable amount of sun, a high rate of rainfall, and high
humidity.
 Regions located near the tropics and in the mountainous
regions are endowed with a temperate climate.

11. Religion
 The major religious traditions in Vietnam are Buddhism (which
fuses forms of Taoism and Confucianism), Christianity
(Catholicism and Protestantism), Islam, Caodaism and the Hoa
Hao sect.

12. Geographic Profile
 Vietnam is
composed of
58 provinces
& 5 centrally
controlled
municipalities

13. Regional Characteristics
 Vietnam is further
divided into 8 regions:
 Northwestern
 Northeastern
 Red River Delta
 North Central Coast
 South Central Coast
 Central Highlands
 Southeastern
 Mekong Delta

14. Country Profile - Overview
 Location: Southeast Asia, bordering the
Gulf of Thailand, Gulf of Tonkin, South
China Sea. Next to China, Laos and
Cambodia.
 Area: 331,210 sq. km – at 66 position
among the world.
 Population: 90,543,390 (July 2011 est.)
 People Age Structure
• 0-14: 25.2%
• 15-64: 59.3%
• 65 or above: 5.5%
• Medium Age: 27.8 years old

15. Country Profile – GDP & Labor
 GDP (PPP) : 276.6 billion (2010 est.)
(Position: 42)
 GDP Growth: 6.8 % (2010 ext.)
 GDP by sector
 Agriculture: 20.6%
 Industry: 41.1%
 Services: 38.3%
 Labor Force: 47.37 (12 of the world) (2010 Est)
 Labor Force by occupation (2009)
 Agriculture: 52.9%
 Industry: 20.3%
 Service 25.8%

16. Country Profile – Import & Export
 Exports Value: $72.07 billion (Position 40)
 Key Export Items:
Clothes, Shoes, Marine Products, Crude
Oil, Electronics, Wood Products, Rice and
Machinery
 Key Export Partners: US (20%), Japan
(10.7%), China (9.8%), South Korea (4.3%) (2010
ext)
 Key Import Items:
Raw Materials for Clothing &
Shoes, Electronics, Plastics, Automobiles, Ma
chinery & Equipment
 Key Import Partners: China (23.8%), South
Korea (11.6%), Japan 10.8%, Taiwan
(8.4%), Thailand (6.7%) (2010 ext.)

17. Country Profile – Export by Sector

18. Country Profile
Vietnam’s Long Term Prosperity Growth (1975-2009)

19. Country Profile
Drivers of Structure Change: Economic Openness
Source: EIU (2010)

20. Market Openness
 Vietnam have become a business partner with a many other countries and
international associations that help to make Vietnam product become more
competitive at importing countries with FTA
– Member of WTO, APEC (1998), ASEAN (1995), ASEM, WB and IMF
– BTA with USA (2001)
– ASEAN (AFTA),
– ASEAN – China (ACFTA),
– ASEAN – Korea (AKFTA).
– ASEAN - Japan (AJCEP),
– ASEAN-Australia –New Zealand (AANZFTA), ASEAN-India (AIFTA), ASEAN-
EU
– Going to complete FTA with Chile in Nov 2011

21. Doing business in Vietnam
 Vietnam has become official member of WTO in last 11th
January 2007.
– Complying with commitments of Vietnam in WTO, there
will be many coming changes in laws and regulations in
Vietnam. As the result, it has made Vietnam economy
turning to be a very attractive market for investment and
business growth.
– The are more companies listed in stock market, more
states companies are privatized. The economy mechanism
has gradually changed into market and dynamic economy.
Information from government is nowadays updated and
more transparent.

22. Country Profile
Vietnam’s Cluster Export Portfolio (1997 – 2009)

23. Country Profile
Relative Wages: Selected Countries
Source: Philippines Department of Labor & Employment (2010)

24. Young Generation
 With 65% of the population aged 30 or
younger, Vietnam is a country of youth. This
population “bonus” will be critical in determining
Vietnam’s destiny over the next decades.

25. Country Profile
Vietnam’s Rate of Inflation of selected countries (2000-2009)
% Change
in CPI
Source: EIU 2010

26. S.W.O.T Analysis
Strengths Opportunities
- Favorable trade policies
- Large young
- Competitive labor cost
population
- Convenient seaports
- Emerging market
Weakness Threads
- Lack of raw - High inflation
materials resources - Competition from
- Hidden costs other SEA countries

27. Country Profile
Internet Usage
 In 2010, Vietnam had a little
over 25 million Internet users or
about 27% of the population
(Source: www.itu.int).
 Public internet cafes and home
use are dominant, however
mobile
(tablet, smartphone, etc) use is
making significant gains.
 In major cities, use of public
Internet terminals is highly
affordable, at about 4000 VND
($0.20 USD) per hour.

28. Country Profile
Social Network Usage
 In 2010, Vietnam’s use of
social media saw a huge leap
in numbers. Young
Vietnamese are increasingly
quite tech-savvy, making use
of various platforms
including
Facebook, Twitter, Blogs, For
ums, and the like.

29. Doing business in Vietnam
– Ministry of Industry & Trade : http://www.moit.gov.vn where you can
find updated information, law and regulation, new policies about
import/export and commerce
– Ministry of Planning and Investment http://www.mpi.gov.vn/ where you
can find updated information, legal issues and guides showing you how
to invest into Vietnam, how to apply and get investment license, which
project Vietnam calling foreign direct investment...
– Vietnam Chamber of Commerce and Investment (VCCI):
http://www.vcci.com.vn Which is an independent, non-governmental
and national organization representing the Vietnamese business
community, business associations, and employers for the promotion and
protection of their interests in domestic and international relations.

30. What did Alibaba.com Do?
- Co-operation with VCCI
 Signing ceremony of co-operation between Alibaba.com, OSB
and VCCI to run pilot program for VN exporters on Jan 15, 2010

31. What did Alibaba.com Do?
- Cooperation with VCCI
Seminar “To explore export Seminar “To explore export
opportunities to APEC and AFRICA” opportunities to APEC and AFRICA”
in Hanoi on May 28, 2010 in HCM city on June 02, 2010

32. What did Alibaba.com Do?
- Cooperation with VCCI
Promoting Export to USA via Exploring export opportunities to
ecommerce on Mar 30, 2011 APEC and AFRICA” in Can Tho city on
May 31, 2010

33. What Does Alibaba.com Do?
 Training of Suppliers To Understand Better of
Buyers’ Requirements
 Organized 2 Supplier Days in Hanoi (Sep 27)
and in HCM City
• Target to Senior Executive of Our Members
• Give Specified Training on their preparation to
buyers’ inquiry and further request

34. Event Photos – Hanoi &HCM City

35. Tips in Doing Business in Vietnam

36. Corporate Culture
 Most decisions are made by committee in
Vietnam.
 "Yes" may not mean "yes“; No problem," you
can take it to mean "Yes, there is a problem.”
 Your local partner in Vietnam is very important
and should be chosen very carefully.
 Payoffs, kickbacks and "gifts" are quite
common.

37. Corporate Culture
 Business name cards are usually exchanged. Give and
receive a business card with both hands.
 The Vietnamese are generally quite punctual and
expect foreigners to be the same.
 Few Vietnamese speak English well. An interpreter is
usually necessary.
 A foreigner doing business in Vietnam will have to deal
with government officials. Direct contact with the
ministry officials who is responsible for granting or
approving your permits and licenses is very important.

38. Doing business with your VN partner
 Business Hints:
– Keep closed contact with official agencies;
– Your documents should be presented in French or
English - or even better in Vietnamese;
– The negotiation is long sometime, so do not become
discouraged too quickly;
– To build up a good interpersonal relationship is the
key to do business success in Vietnam;
– The necessity to building the trust is by constant
communications and regular contacts.

39. Hints for your first successful business trip to Vietnam
 GET YOUR MONEY - THE PAYMENT METHOD
– Exchange regulations in Vietnam involve specific measures preventing
the Dong from being freely convertible into foreign currency. Most
exchange operations must be authorized by the central bank. The
best currency for billing, or at least the most commonly used, is the
US dollar. The best payment method remains an irrevocable letter of
credit at sight.
 YOUR MONEY THERE - THE BANKING SYSTEM
– As part of the reform, the most of the commercial banks were
established and authorized to perform foreign currency operations.
Some major banks like: Industrial and Commercial Bank of Vietnam
(ICBV), Agricultural Bank of Vietnam (Agribank), Foreign Trade Bank
(Vietcombank), Bank for Investment and Development of Vietnam
(BIDV), Saigonbank and Eximbank. And now there are some other
international financial banks likes HSBC, Standard and Charter and
City Bank etc.

40. Hints for your first successful business trip to Vietnam
 THE MOST IMPORTANT TIP - BUSINESS ETIQUETTE
– One of the keys to business success in Vietnam is
understanding that local customs and behavioral practices
have a significant effect on business relationships. While
there are few formal limitations to doing business in
Vietnam, there are some informal barriers and practices
which differ from Western norms. Bureaucratic difficulties
are not uncommon, particularly in relation to customs and
documentation. However, patience, persistence and
sound business advice can help in overcoming these
obstacles.

41. Hints for your first successful business trip to Vietnam
 Establishing Contacts & Networks
– Although the Vietnamese will agree to appointments with
unknown contacts, it is far easier if the first meeting is
through introduction from a known business contact in
Vietnam, through friend or through an official channels.
Vietnamese companies may not have access to the internet
or other forms of information and feel more secure when the
company has been introduced to them.
– Personal business introductions are a fundamental way of
doing business in Vietnam and "cold calling" can often mean
that you end up speaking with someone totally unrelated to
the issue you wish to discuss.

42. Hints for your first successful business trip to Vietnam
 Business Entertainment
– Aware that Vietnamese are a very polite people and will often
smile and agree with you when in fact they may not have fully
understand what you have said. The smile and head nod are
usually to confirm that they acknowledge you have spoken, and
may not always indicate a firm agreement.
– It is advisable to have bilingual sales literature, including business
cards and product manuals, for more complex negotiations. It is
useful to have an agenda and relevant papers translated in
Vietnamese prior to the meeting so both sides are clear on what
they wish to discuss.
– Eating and drinking are a major part of doing business in Vietnam.
Dinners with local agents and customers help to develop networks
and cement relationships.

43. Contact Us
Michael Mang
Senior Manager
http://buyer.alibaba.com/
Skype: michaelmang1119
Email: michaelmang@hk.alibaba-inc.com
Direct line: 852-22155233
Mobile Phone: 852-98455407
China Mobile: 86-13732292872
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