Lately, I’ve been getting a lot of questions about outsourcing IT to Vietnam. The shift is noticeable and for many, it’s no longer just a country with a history of war and jungles; Vietnam started positioning itself as a developed country. With a modern ecosystem, skilled engineers, and cost advantages, Vietnam is making noise in the outsourcing world. But what’s driving this shift, and what should you know before you dive in?
Let me share some insights—practical ones—from my eight years of working in Vietnam. Below I will also share pros and cons of IT outsourcing to Vietnam, so let’s start.
Why there is so much focus on Vietnam
Vietnam isn’t just a low-cost alternative anymore. It’s a serious contender for companies looking to outsource IT in Asia. Big names like Apple, NVIDIA, Samsung, and LG have already set up operations here, and I bet you that those big names bringing a lot of attention to this Southeast Asian country. But what makes it stand out?
The Pros of Outsourcing IT to Vietnam
1. Cost-Effectiveness Without Compromise
Vietnam offers significant cost advantages. Hourly rates here are often 30-60% lower than in Western countries, but this doesn’t mean you’re sacrificing quality. Vietnamese engineers are known for their skill and dedication.
2. Access to a Skilled Workforce
With around 500,000 software engineers, Vietnam has an impressive talent pool. This young and dynamic workforce not only boasts expertise in traditional programming languages and cutting-edge fields like blockchain and AI but also benefits from widespread access to the internet. Vietnam’s digitally savvy youth are eager to succeed, driven by a hunger for achievement and a strong entrepreneurial spirit. This combination makes the country a prime destination for companies seeking a global outsourcing partner.
3. A Thriving IT Ecosystem
Cities like Ho Chi Minh City and Hanoi have become vibrant IT hubs. These places aren’t just about low-cost labor; they’re centers of innovation and collaboration, perfect for businesses looking for dynamic partnerships.
4. Time Zone Advantage
If you’re based in the West, Vietnam’s time zone can be a game-changer. Your team in Vietnam can work on projects while you sleep, providing a near 24/7 workflow.
5. Supportive Policies
The Vietnamese government has rolled out business-friendly policies and tax incentives for IT outsourcing. This proactive approach makes it easier for foreign companies to establish and grow operations here.
6. The Ripple Effect of Big Players
When giants like Apple and Samsung set up shop in Vietnam, they don’t just boost their own operations—they uplift the entire industry. Local vendors and smaller IT firms benefit from the increased demand and knowledge sharing.
The Challenges You Need to Be Aware Of
Of course, no destination is without its challenges. Here are some things to watch out for when outsourcing IT to Vietnam:
1. Cultural and Communication Gaps
Understanding cultural nuances is key to building strong partnerships. Misunderstandings can happen, but clear communication and a willingness to learn go a long way.
2. Time Zone Juggling
While the time difference can be an advantage, it’s a double-edged sword. Scheduling meetings and aligning timelines require careful planning.
3. Specialized Needs Might Require More Effort
For niche or highly specialized projects, Vietnam’s IT sector might not yet rival some of the more established outsourcing destinations. However, this gap is closing fast.
4. Picking the Right Vendor
Choosing the right partner can be tricky if you’re new to the market. Without local connections or experience, it’s easy to feel overwhelmed by the options.
My Advice for Success
Vietnam is full of opportunities, but success depends on how you approach it. Here’s what I’ve learned:
1. Use Trusted Networks
Organizations like EVIT or VINASA can connect you with reliable vendors. At EVIT, for example, we leverage our vast network of 300 IT service providers to identify the most suitable partner for your needs. We conduct thorough due diligence, negotiate contracts, and assign a dedicated customer success manager to oversee the entire collaboration. What’s more, we do all this without charging you a fee. This isn’t just about self-promotion—it’s about showing that you can save time, money, and effort while significantly reducing risks when finding the right partner.
2. Do Your Homework
Before signing any contracts, dig deep. Check out vendor portfolios, talk to their past clients, and make sure their expertise aligns with your needs.
3. Communicate, Communicate, Communicate
Set clear expectations from day one. Regular updates and open communication help avoid misunderstandings and keep things on track.
4. Think Long-Term
In Vietnam, relationships matter. Treat your outsourcing partner as a long-term collaborator, not just a vendor. This approach builds trust and leads to better outcomes.
Final Thoughts
If you’re considering IT outsourcing in Asia, Vietnam is worth a serious look. From my personal experience, outsourcing IT to Vietnam has been about more than just saving costs; it’s been a gateway to a vibrant, evolving market full of potential. With the right strategy and a partner you can trust, the rewards go beyond financial—you gain a dynamic, forward-thinking extension of your team.