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What business sectors or industries are highly profitable in Vietnam

What business sectors or industries are highly profitable in Vietnam

Business sectors or industries are highly profitable in Vietnam →

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Business sectors or industries are highly profitable in Vietnam

What business sectors or industries are highly profitable in Vietnam, Invest in Vietnam, one of the countries with the most dynamic economies in ASEAN. Learn about the best sectors for investment in Vietnam in 2022

#1. 09 Business sectors or industries are highly profitable in Vietnam 2022 

1. High-end and Luxury Hotels

In 2016, the tourism revenue of Vietnam reached US$9.3 billion. It is also estimated that the number will double by 2027. Though accommodation businesses in tourism and hospitality industry are flourishing in Vietnam, those high-end and luxury hotel sectors, particularly 4 or 5-star hotels are still untapped in the country. Therefore, these upscale tourism accommodations present a huge investment potential.

Preferred ways to get started in this untapped sector is via joint ventures and partnerships in major cities such as Hanoi and Ho Chi Minh City, where the highest number of tourists are recorded.

In Vietnam, the luxury hotels are mainly prevailed by huge international brands such as Accorhotels, InterContinental Group and Hilton Group. Thus, joint ventures and partnerships with local developers are the best options for foreign investors to get into the scene.

2. Business Process Outsourcing

Also known as BPO and as a sub-sector in the Information and Communications technology (ICT), business process outsourcing is a booming sector in Vietnam. The revenue of ICT was recorded at US$59.9 billion in 2016.
It is positive that the BPO industry will continue to grow extremely fast, led by Vietnam’s surging skills and talent pool. Furthermore, BPO can be extended to support the prospering manufacturing industry in Vietnam.

The best way to get started in a BPO sector is through setting up a new company, partnership and acquisition of local operations. Potential hubs for BPO in Vietnam include Hanoi, Ho Chi Minh City, and Da Nang.

Sources of electricity generation in Vietnam are coal, gas turbines and hydropower. However, these natural sources are not renewable and the government of Vietnam is putting in efforts to increase the use of renewable energy. The government aims to take advantage of the country’s solar and wind energy potential and triple its share for electricity production by 2030.

Location wise, the southern region in Vietnam is more suitable for investors to put their money in solar projects, while the mountainous regions of central Vietnam and the coastal areas in the south central region are suitable for wind energy projects.

3. Retail Banking and Fintech

There is high percentage of unbanked population in Vietnam. And, the banking and financial services sectors are still underdeveloped as well, meaning numerous opportunities for investors this rapidly developing country.

Among the many banking and financial sectors, retail banking with payment cards and wealth management services are particularly high potential. Fintech is also another sector to look into as Vietnam has a good foundation to transform into a cashless society in the very near future, due to its high mobile penetration.

4. Food and Modern Agribusiness

Even though the export of agriculture products in Vietnam has increased over the years, this sector has grown slowly due to its low modernisation and productivity. Agriculture contributes to 20% of the country’s total export and thereby we can see a huge potential in modern agribusiness sector.

5. E-commerce

According to Vietnam E-Commerce Association, by 2025, the e-commerce sector in Vietnam will be ranked third after Indonesia and Thailand.

Most of Vietnam’s e-commerce activities can be found in Hanoi and Ho Chi Minh City and their sales contribute to 70% of the country’s total e-commerce sales.

The internet economy in Vietnam has brought in more than US$1 billion in funding in the past four years.

These other reasons are appealing as well: e-commerce turnover in Vietnam is forecast to reach US$10 billion by 2020, along with approximately 30% of the Vietnamese people will shop online (approximately 30 million online shoppers). And currently, Vietnam has a population of 96 million people with a rapidly increasing number of smartphone and Internet users, making Vietnam the most tempting country for abundant e-commerce businesses.

6. The Quickly Evolving Fintech Industry in Vietnam

By 2020, the revenue of the fintech industry in Vietnam hit approximately US$7.8 billion. This evolution is mainly due to the growing middle class, increasing young population, and rising internet usage in Vietnam.

There are at least 120 fintech-related companies in Vietnam now, covering services from digital payment to wealth management, blockchain to cryptocurrency.

Digital payment is a leading fintech segment in Vietnam

Over 66% of Vietnamese fintech companies are involved in digital payment services via online payment apps, and they have taken over 87% of the fintech market share.

The rise of digital payment fintech companies can be seen when the State Bank of Vietnam (SBV) issued licenses to 27 intermediary payment service providers, of which most of them are e-wallet service providers.

Personal finance is an emerging fintech segment in Vietnam

Personal finance is about the financial activities and decisions of households or individuals. These activities include saving, earning, saving, spending, and investing that are all performed online.

At these current growth rates of smartphone users and Internet penetration, as well as the surge of digital payments, personal finance is to grow rapidly until 2025.

Emerging markets in this segment in Vietnam are online peer-to-peer (P2P) lending platforms, personal advisors through AI, and group saving.

7. Software Outsourcing

A survey has shown that 73% of companies and organizations will utilize software outsourcing in Vietnam, making software outsourcing an IT industry with great potential for the past decade.

Compared to India and China, Vietnam has now become a cheaper alternative as an outsourcing destination globally. Revenue of US$8.8 billion was recorded in 2018 for Vietnam’s software industry.

In order to advance the growth, the Vietnamese government is providing different incentives to the industry and allocating funds to build high-tech parks.

8. Artificial Intelligence (AI)

The artificial intelligence (AI) industry in Vietnam is still developing but it has also become one of the IT-related industries with strong potential.

The country sees a robust application of AI to many sectors including education, agriculture, healthcare, transport, human resources, e-commerce, and others.

It is certain that the implementation of Industry 4.0 can help develop the AI sector in Vietnam further. Foreign investors interested in investing in Vietnam will surely need to consider this sector.

9. Education Technology

In 2018 alone, education technology (Edtech) in Vietnam has gained US$55 million in total investments – thanks to the Edtech centers being able to close the gap between traditional education settings and learning requirements.

This sector has attracted investors from all over the world, especially those from Singapore, South Korea, Japan, and Australia. They are particularly interested in education sectors from kindergarten to grade 12 as Vietnamese spend as much as 40% of their income on them.

10. The Quickly Evolving Fintech Industry in Vietnam

By 2020, the revenue of the fintech industry in Vietnam hit approximately US$7.8 billion. This evolution is mainly due to the growing middle class, increasing young population, and rising internet usage in Vietnam.

There are at least 120 fintech-related companies in Vietnam now, covering services from digital payment to wealth management, blockchain to cryptocurrency.

#2.10 Lucrative Business Opportunities in Vietnam

1. Business of Restaurant & Bar

The people of Vietnam always love and appreciate amazing drinks and tasty food. Making a restaurant in Vietnam is a lucrative business idea indeed.

In one corner of the restaurant, you can also make a bar. It will increase the liveliness of the place. Moreover, more people will be attracted not just to eat food but also to have some drinks. It can be a great business opportunities in Vietnam.

2. Property Supervision Business

Vietnam has a great number of property owners. Either these property owners do not have the ability to give attention to the properties’ details or they simply do not have any interest in it.

These kinds of people appreciate property supervisors and they hire them happily. They do not mind to pay them even a heavy salary for handling the matters of their property.

3. Becoming a Perfume Producer

The business of perfumes in Vietnam is very lucrative. You just need to have a good taste of scents. People having a desire of experimenting with different scented oils go a way beyond in this type of business.

For standing out in the market, it is important to create the blends of fragrances that are unique and mesmerizing. You just need to have some trusted suppliers who supply the wholesale raw materials whenever required.

You can take a start by just making a perfume store. Later on, you can make a whole shop and launch your brand. You just need to be good in the choice of fragrances. It is one of the smart business ideas to pursue in Vietnam.

4. Starting a Bakery Business

Starting the business of making a bakery is a lucrative business in Vietnam. Moreover, it is one of the most successful ideas for starting your business.

There are many options that you can choose, for keeping various products and selling them; they include cakes, donuts, sweet rolls and a lot more. A great number of customers get attracted to these kinds of sweets and other bakery items. You just need to take care of one thing, i.e. your marketing strategies.

5. Pet Shop Business

Starting a pet shop business is one of the amazing and the most lively business opportunities in Vietnam for the year 2018-2019. The pet care has continuously been growing in the country.

The most preferred pets in the country are fish, cats, etc. There is a great trend to take care of pets and keep a look on their health and other needs.

A great number of people who keep pets and love them, never mind to spend money for their wellness, and get them packaged food that is expensive for them of course.

6. Making a Barber Shop

Haircut is something that everybody needs to be done.  Therefore, starting a business of barbershop is a great way to generate revenue.

But, it is important to know the suitable location for setting up the shop. It can be a lucrative business and is one of the best businesses to do in Vietnam. If your business starts expanding, then you can hire other barbers in your shop afterward.

7. Bicycle Rental Business

Many people in Vietnam prefer to travel via bikes within the cities. Therefore, the idea of a bicycle rental business is amazing indeed.

It is preferable to setup your business near, large resort, or a hotel where a number of people come on regular basis. Lots of tourists also prefer to go to the nearby places via bikes.

You can advertise your business by giving flyers to various hotels and resorts near your business setup and sometimes making deals with them.

8. Business of Online Clothes

Having a good sense of fashion can be very beneficial for you if you want to start a business related to clothing. Initially, you can start an online business where you can take order from different individuals according to their requirements.

There is no need of a great capital for starting this business. However, you have to display some of your sample dresses and outfits, of course.

It is such a small business, which has great chances of success in Vietnam. It is one of the amazing Vietnam investment opportunities.

9. Making a Tourism Agency

Tourism is very common in Vietnam because of the beautiful sights and splendid sceneries of the country.

The monuments in the country also make it worth visiting and a major attraction for the tourists from all over the world.

The people of Vietnam are quite hospitable for the people coming from different parts of the world. Therefore, tourists love to visit Vietnam and there is a great business of tourist agencies.

10. Real Estate Business

This is another business in Vietnam, which is very lucrative. It is related to the resale of building properties. The numbers of immigrants who are coming to the country are increasing. With that, the need of this business is also expanding.

The country is opening up the economy and is bringing down the tariff barriers, as well as the non-tariff barriers, within the continent of Asia. Some other business opportunities in Vietnam are as follows:

11. Business of Used Car Dealer

12. Business of Detergents, Cosmetics, etc.

13. Furniture Making Business

14. Business of Building Material

15. Business of Textile Items

3# EXPAND YOUR BUSINESS TO VIETNAM WITH LHD LAW FIRM

Gain your market presence in Vietnam through our business set up services. With a team of experienced professionals, LHD LAW FIRM can provide advisory on the best strategies to establish your business in Vietnam.

Just like every other market, Vietnam is a unique country. Deep understanding of the business environment and legal practices is required. Cekindo makes sure that your company is set up properly and in compliance with Vietnam’s legal requirements.

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