5 Reasons You Should Choose Vietnam for Outsourcing IT
While Eastern Europe, China, and India appear to be the leading destinations for offshore software development services and IT solutions, Vietnam has gradually positioned itself as an emerging power in this area.
Indeed, Revenue from Vietnam's Information and Communications Technology (ICT) industry reached $148 billion in 2022, indicating a 10% rise year on year. The industry's contribution to GDP was reported to be $34.3 billion, an increase of 8.7%. Additionally, its economic capital Ho Chi Minh City is frequently cited as one of the top outsourcing hubs in The Tholons indexes.
Between 2014 and 2019, Vietnam’s Information and Communications Technology (ICT) sector had an average yearly growth of 9.8%, with annual revenue of $110 billion in 2019, representing almost 1/6th of the whole nation’s GDP. Additionally, its economic capital Ho Chi Minh City is frequently cited as one of the top outsourcing cities in the world.
Vietnam's education system prioritizes STEM subjects, and IT degrees are in high demand. This has led to a steady flow of talented IT professionals who are fluent in English and familiar with international business practices.
With a young population with a strong appetite for education, Vietnam indeed offers an undeniably strong talent pool. With nearly 100 million inhabitants, 53% of whom are under the age of 35 (and a median age of 32.8 years), Vietnam is a significant demographic power that can easily fuel its booming IT industry. It also has one of the lowest unemployment rates in the world.
According to TopDev's report, each year, Vietnam trains some 400,000 IT engineers, in one of the 153 institutions listed in the country.
Ministry of Information and Communications (MIC) reported that the total number of digital tech firms in Vietnam in 2022 was 70,000, an increase of 9.6% over the previous year. 60% of these companies are switching from low-value to high-value manufacturing processes.
Vietnam ranks 29th, right above France, in terms of Skillvalue Worldwide in the Developer Skills Chart Of Skill Value Report in 2018.
Vietnam Ranks 3rd for Artificial Intelligence Coders according to Hacker Rank’s Report of 2021.
Vietnamese Coders have the 11th highest rating in the World according to the Developer Skills Charts Of Topcoder Report in 2022.
International firms are not mistaken: many High-Tech companies such as Qualcomm, Intel, Sony and Samsung have invested heavily in the country over recent years. Hiring and R&D investments are thus going well in Vietnam, with little turnover in the IT-related industries. IT outsourcing companies in Vietnam are also growing, offering healthy competition for you to choose from!
2. Attractive Costs
In a country where GDP per capita is just around 4,000 USD, despite very strong economic growth, the cost of infrastructure and labor remains quite low compared to the rest of the world.
Vietnam offers highly competitive pricing for IT outsourcing services. The average hourly rate for a software developer is around $25 (or in the $20-40 price range), which is significantly lower than the rates in other outsourcing destinations such as India or China. Vietnam's offshore services pricing is therefore a tempting offer for companies trying to cut expenses without risking quality.
CIO magazine claims that outsourcing to Vietnam can save you up to 90% of software development compared to the United States of America. Other studies suggest that software development costs are also 50% inferior in Vietnam compared to India. Outsourcing software in Vietnam is one of the best value-for-money you can find in the world! Vietnamese software development companies can offer their services at extremely competitive rates.
3. A Stable Environment
Vietnam’s political landscape is known to be extremely stable, with an appropriate legal framework, and a very resilient economy, contrary to a lot of its neighboring countries such as India, Thailand, Myanmar, and the Philippines which may be prone to uprisings, regional conflicts, or social disarray.
Since the 1990s, Vietnam has experienced strong and sustained growth, even during the COVID crisis. It remains one of the only countries in the world to have been able to maintain the biggest share of its economic activity during the years 2020 and 2021, with around +3% GDP growth per year. With growth hitting 8.0% in 2022, Vietnam's economy saw a significant rebound from its average rates of 7.1% from 2016 to 2019, predicting a positive prospect for upcoming years.
Even when the world is in turmoil, stability seems to reign in Vietnam, offering unparalleled conditions for the security of your projects and their deadlines.
4. A Prime Location for Business
Vietnam is at the heart of South East Asia, which is currently the most dynamic economic region in the world and can be considered to be a bridge between China and the rest of ASEAN.
Perfectly integrated into the world economy, Vietnam is at the crossroads of business destinations such as Singapore, Thailand (Bangkok), Malaysia (Kuala Lumpur), and Hong Kong, all located less than 2 hours away from Vietnam by plane.
Its network of transportation is growing larger by the day, and plans of opening new international airports will make Vietnam even more globally relevant, with very frequent and accessible flight routes to and from all over the world.
If it is true that because of its history, India has always been considered a prime destination for English-Speakers to do business with, let us not forget that Vietnam also has a valuable advantage in the form of its Latin alphabet. Contrary to most Asian countries, Vietnam is indeed one of the only (along with the Philippines and Malaysia) to use a “Westernized” version of its written language.
As a result, it makes it relatively easy for Vietnamese to learn English, which is incidentally the most popular foreign language in the country. According to a survey conducted by Statista in June 2021 in Vietnam, English was learned by 86% of the respondents. Around 50% of the Vietnamese population can communicate in English, with a higher rate in the main cities like Ho Chi Minh City and Ha Noi. The vast majority of Vietnam’s College Graduates have a high proficiency in English. The Vietnamese government is also particularly committed to expanding English language education to meet the requirements of skills-intensive jobs in high-tech employment sectors. As of today, Vietnam ranks #7 on the English Proficiency Index out of 24 Asian countries.
So if you choose to work on outsourcing projects in Vietnam, you will find that the so-called language barrier is almost non-existent, especially if you work with us and our international teams where we offer expertise in English, French, Spanish, Japanese & Vietnamese.
Created in 2003, Dirox is one of the oldest IT companies in Vietnam, and a force to be reckoned with when it comes to outsourcing your app development projects.
We have the capability and experience to manage any digital project from beginning to end, while being within budget, on time, and with a high level of quality. We have a proven track record of over one hundred successful digital products launched.
Being highly involved in the process of recruiting the best talent in the country, Dirox is in constant contact with Vietnam’s top universities, and we aim for an unparalleled quality of work environment for all our employees.
Our multi-national teams are trained to understand all your needs while guaranteeing the best standards in the industry.
Contact us today to learn more about outsourcing your Digital Project in Vietnam.
Started in 2003 in Ho Chi Minh City Vietnam, our Development Company operates on a Global Scale in Asia, Europe, and America. Dirox’s team of technology consultants, business gurus, software & apps coders, and design visionaries bring you innovative solutions on time, on budget, and on quality. We strive to bring you the best IT outsourcing & offshore services.