HCMC – While their presence is still small, foreign logistics firms are seeing increasing success and growth in Vietnam. As the country’s economy continues to grow, these firms are expected to continue to increase their level of investment and footprint on the ground in Vietnam.
Vietnam’s logistics market is currently worth US$60 billion. In total, there are around 1,000 logistics firms – 25 of which are foreign firms. Foreign firms of note are Maersk Logistics, APL Logistics, NYK Logistics and MOL Logistics. Most foreign firms can offer third or fourth party logistics (3PL or 4PL) services while Vietnam domestic firms can only handle 2PL services.
Foreign firms in Vietnam currently hold 80 percent of the market share, worth US$48 billion.
Transportation services (road and ocean) are currently the largest subsectors. The ocean shipping services are dominated by joint ventures while road-shipping services are mostly handled by domestic firms.
Cold Chain (storage and cold transportation), however, is considered the sector with the most growth potential for foreign investors. The continued entry of major retailers and the increasing export of farming and seafood products are expected to create multiple opportunities for Cold Chain specialists. Additionally, due to Vietnam’s traditional “eating fresh” society, the “frozen food” retail sector is currently fragmented and the Cold Chain industry is under-invested. In order to remedy this situation, the government has introduced various financial incentives in order to attract foreign investment into this segment. Japanese firms make up the largest percentage of foreign specialists at this time.
Source: Vietnam-briefing