Vietnam is rapidly emerging as one of the fastest-growing economies in Southeast Asia, attracting businesses from all over the world. If you’re considering expanding your business to Vietnam, you’ll need to choose the right approach. In this blog post, we’ll compare the two most popular options for expanding to Vietnam: setting up a company and using a Global Employer of Record (EOR) service. We’ll also explore the labour market characteristics in Vietnam and recruitment options.
Why You Should Consider Vietnam for Your Expansion
Vietnam has undergone significant economic transformation in the last few decades, transforming itself into a vibrant, modern economy. The country is known for its young and dynamic workforce, a strategic location, and its open, market-oriented policies. It is an ideal destination for businesses looking to access the ASEAN (Association of Southeast Asian Nations) market.
Characteristics of the Labour Market in Vietnam
Vietnam’s labour market is relatively large, with over 57 million workers. The majority of the workforce is concentrated in the agriculture sector, followed by the industrial and service sectors. Vietnam is known for its young and dynamic workforce, with a median age of 32.3 years.
The Process of Company Incorporation in Vietnam
Setting up a company in Vietnam involves several steps that must be followed in accordance with Vietnamese laws and regulations. The process includes reserving a company name, registering the company, obtaining a business license, and opening a corporate bank account. It’s essential to work with a qualified attorney or business consultant who can guide you through the process.
The Alternative of EOR, What It Is?
An EOR service enables a company to hire employees in a foreign country without establishing a legal entity in that country. The EOR provider takes on the responsibility for legal compliance, payroll, benefits administration, and tax compliance. In other words, the EOR provider acts as the employer of record for the employees.
Employer of Record Vietnam: Step by Step of the Process
The process of setting up a Global EOR in Vietnam involves selecting an EOR provider, signing a service agreement, and providing necessary information about the employees. The EOR provider then establishes a local entity in Vietnam and takes on the responsibility for legal compliance, payroll, benefits administration, and tax compliance. The employees are employed by the local entity established by the EOR provider.
Advantages of Employer Of Record in Vietnam
Using an EOR service to expand to Vietnam offers several advantages, including:
- Faster time to market: The process of setting up a company in Vietnam can be time-consuming. By using an EOR service, companies can start operations in Vietnam quickly.
- Legal compliance: The EOR provider takes on the responsibility for legal compliance, reducing the risk of non-compliance for the company.
- Cost savings: Setting up a company in Vietnam involves significant costs, including legal fees, registration fees, and ongoing maintenance costs. Using an EOR service can be a more cost-effective option.
Recruitment in Vietnam
Recruiting talented and qualified individuals is crucial for any company to succeed in Vietnam. However, the process can be challenging, especially for foreign companies expanding into the country. Here are some tips:
- Know the job market
Before starting the recruitment process, it’s important to understand the job market in Vietnam. The country has a young and rapidly growing population, with a median age of 31.5 years old. The largest industries in Vietnam include manufacturing, construction, retail, and hospitality.
Vietnamese job seekers are typically highly skilled, with many holding degrees in engineering, technology, and business. However, language barriers can be a challenge when it comes to hiring.
- Use online job portals
Online job portals are widely used in Vietnam and can be a great way to reach a large audience of job seekers. Some popular job portals in Vietnam include VietnamWorks, CareerBuilder, and JobStreet.
When posting a job listing, it’s important to be specific about the qualifications and experience required for the position. It’s also a good idea to include information about the company and its values to attract candidates who share those values.
- Utilize social media
Social media is a powerful tool for recruitment in Vietnam. Platforms like Facebook, LinkedIn, and Zalo are widely used by Vietnamese professionals.
Creating a company page on these platforms can help build brand awareness and attract potential candidates. It’s also a good idea to post job listings on these platforms and encourage employees to share the listings with their networks.
- Attend job fairs and events
Attending job fairs and events is a great way to meet potential candidates in person. These events are popular in Vietnam, and there are many opportunities throughout the year to connect with job seekers.
It’s important to come prepared with information about the company and any open positions. It’s also a good idea to have a clear understanding of the type of candidate you’re looking for and the qualifications required for the position.
- Partner with a recruitment agency
Partnering with a recruitment agency can be a good option for companies expanding into Vietnam. These agencies have expertise in the local job market and can help identify qualified candidates.
When choosing a recruitment agency, it’s important to do research and choose one with experience in your industry. It’s also a good idea to ask for references and case studies of successful placements.
In conclusion, recruiting in Vietnam can be challenging, but with the right strategies, it’s possible to find talented and qualified candidates. Understanding the job market, using online job portals and social media, attending job fairs and events, and partnering with a recruitment agency are all effective ways to find the right candidates for your company.
Expanding your business to Vietnam can be a wise decision due to its growing economy and strategic location. When deciding which way to expand, consider the characteristics of the labour market, the process of company incorporation, and the benefits of using an EOR service. Ultimately, the best approach will depend on your business needs, goals, and budget. Working with a knowledgeable attorney, business consultant, or EOR provider can help ensure a smooth expansion to Vietnam.