Vietnam has huge potential for cross-border e-commerce development

According to the Vietnam E-Commerce Association’s Vietnam E-Commerce Business Index Report (EBI 2024), the Vietnamese e-commerce market was valued at US$25 billion in 2023, up 25 percent plus from 2022, with online retail sales reaching US$17.3 billion.

Exports via e-commerce boosted

According to the Vietnam E-Commerce Association’s Vietnam E-Commerce Business Index Report (EBI 2024), the Vietnamese e-commerce market was valued at US$25 billion in 2023, up 25 percent plus from 2022, with online retail sales reaching US$17.3 billion.

Amazon Global Selling’s statistics show that the quantity of products sold by Vietnamese businesses on Amazon has increased by 300 percent plus over the past five years. Thousands of Vietnamese small- and medium-sized enterprises (SMEs) are exporting through Amazon, with the number of businesses achieving annual revenues of over US$1 million growing almost tenfold.

Associate Professor, Dr. Tran Minh Tuan, Director of the Ministry of Information and Communications’ Department of Digital Economy and Digital Society, said at a recent e-commerce development seminar that cross-border e-commerce is witnessing substantial growth opportunities, especially given Vietnam’s proximity to the massive Chinese market. Additionally, Vietnamese digital technology companies have built B2B e-commerce platforms, connecting with major global e-commerce platforms, such as Amazon, Alibaba, and Timo. As a result, when goods are listed on Vietnam’s e-commerce platforms, they also appear on major global e-commerce platforms, directly connecting buyers with sellers and manufacturers.

Lai Viet Anh, Deputy Head of the Ministry of Industry and Trade’s Vietnam E-Commerce and Digital Economy Agency, said Vietnam has immense potential for cross-border e-commerce development, as it is an export-oriented economy strong in the fields of textile and garment, leather and footwear, rice and other agricultural products. It is estimated that cross-border e-commerce exports reached approximately US$3.3 billion in 2022 and are expected to exceed US$11 billion by 2027 with supportive mechanisms from both e-commerce platforms and the Government.

Tran Tuan Anh, Managing Director of Shopee Vietnam, highlighted that Vietnam’s domestic manufacturing remains strong, which serves as a foundation to leverage skilled labor for further development.

Five-year e-commerce development plan

Experts have noted that Vietnamese businesses still face limitations in e-commerce. Most businesses are small in scale, lacking the capacity to build brands and struggling to withstand sudden and continuous market fluctuations. Furthermore, the workforce for cross-border e-commerce is not yet meeting the requirements, and there is a lack of information on foreign market regulations and trends, as well as limited skills and knowledge in business strategy, branding, and brand protection in cross-border e-commerce.

To succeed in selling products on international e-commerce platforms, businesses need to understand consumer behaviors, including brand preference, reliability, convenience, and appropriate services. They must also create standout brands in the online environment. Products listed for sale must be attractively packaged, of high quality, and should use environmentally friendly and sustainable materials. Importantly, products must not violate any trademark regulations.

Vietnam E-Commerce and Digital Economy Agency’s Lai Viet Anh said the Ministry of Industry and Trade is suggesting the government a comprehensive e-commerce plan for the next five years. This plan aims to promote exports, bring ‘Made in Vietnam’ products to international markets, and support SMEs and manufacturers in selling their products globally.

She highlighted that green and sustainable consumption is a prominent global trend. For Vietnamese goods to reach global markets, businesses need to carefully consider sustainability factors.

The application of digital technology and digitization in e-commerce will play a crucial role. For example, customers may require traceability of products, assurance of non-deforestation, or compliance with environmental protection and waste reduction regulations. Businesses need to address these issues by digitizing value chains and production processes and applying technology at every stage of production. These are something that e-commerce businesses must adopt to enhance the competitiveness of Vietnamese goods in international markets.

Source: Vietnam Economic News