22 DEVELOPING SALES STRATEGY AT VACOM JOINT STOCK COMPANY

MINISTRY OF FINANCE
ACADEMY OF FINANCE
----------

Student: NGUYEN THI NGOC ANH
Group: CQ55/51.01

GRADUATION THESIS
TOPIC:
DEVELOPING SALES STRATEGY AT VACOM JOINT-STOCK
COMPANY

Major

: English for Finance and Accounting

Student code: 17522202010003
Supervisor : Mrs. Phan Thi Ha My M.A.,

Ha Noi – 2021
MINISTRY OF FINANCE


ACADEMY OF FINANCE
--------

STUDENT: NGUYEN THI NGOC ANH
GROUP: CQ55/51.01

GRADUATION THESIS
TOPIC:

DEVELOPING SALES STRATEGY AT VACOM JOINT-STOCK COMPANY

Major

: English for Finance and Accounting

Student code: 17522202010002
Supervisor : Mrs. Phan Thi Ha My M.A.,

Ha Noi, 2021

2


Graduation Thesis

Academy Of Finance
DECLARATION

I, Nguyen Thi Ngoc Anh, being a student of Faculty of Foreign Languages, hereby
certify my authorship of the thesis submitted today entitled:
Thesis: “Developing sales strategy at VACOM joint-stock company”
I declare that the thesis and the study presented in it are my own and have been
generated by me as the result of my own original research.
Hanoi, May 20th, 2021
Graduation thesis’s author

Student: Le Mai Anh

3

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance
ABSTRACT

This graduation thesis examined sales strategy at VACOM joint-stock company.
The study was conducted based on theoretical background of sales strategy and
current situation of business strategy at VACOM joint-stock company. The thesis
was done with the implementation of documentary review, the questionnaire survey
and SWOT analysis. From this constructive approach, the study sought to
investigate the difficulties in sales strategy and solutions proposed to improve
business strategy at VACOM joint-stock company.

Student: Nguyen Thi Ngoc Anh

4

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance
ACKNOWLEDGEMENT

First of all, I would like to express my deepest thanks and gratefulness to my

supervisor, Mrs. Phan Thi Ha My M.A., lecturer of the Faculty of Foreign
Languages, Academy of Finance. Her kindly support and continuous advices went
through the process of completion of my thesis. Her encouragement and comments
significantly enriched and improved my work. Without her motivation and
instructions, the thesis would have been impossible to be done effectively.
I acknowledge my thankfulness to all staff at VACOM joint-stock company who
have supported, helped, and provided me valuable suggestions and data during the
internship period. Without their bits of help, it would be impossible for me to finish
this thesis.
I also would like to show my sincere thanks to all the lecturers in the Faculty of
Foreign Languages of Academy of Finance for tireless devoting time and efforts to
enrich, broaden and deepen my knowledge over the past four years. My heartfelt
gratitude goes as well to the Faculty of Foreign Languages of Academy of Finance
for giving me the opportunity and permission to implement this thesis. I
furthermore thank to all the lecturers who will mark and give constructive
comments on this thesis.
My special thanks approve to my parents, my colleagues and my friends for their
advice and encouragement to me. I also deeply thank to all the people whose direct
and indirect support assists me to accomplish my thesis in time.
Thank you all, in advance.

Student: Nguyen Thi Ngoc Anh

5

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance
LIST OF ABBREVIATIONS
%
PBT
JSC

Student: Nguyen Thi Ngoc Anh

Percent
Profit before tax
joint-stock company

6

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance
LIST OF FIGURES AND TABLES

Student: Nguyen Thi Ngoc Anh

7

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance
TABLE OF CONTENTS

Student: Nguyen Thi Ngoc Anh

8

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance
INTRODUCTION

1. Rationale of the study

In the market economy with the current strong globalization trend, customers
have more conditions to access innovative products and services that are constantly
innovating along with the development of the department learn technology. To
attract customers and dominate the market, each company uses different methods
and the goal of administrators is to make differences. Therefore the closure of loss
companies and the development of highly effective companies significantly depend
on business strategy of that company. Strategy is a word derived from the military
field, which is the way to win a war. However, the social is growing and strategic
thinking is not dedicated only in the military field, business activities also use with
the elements like strategy and leadership. Recently, Johnson and Scholes (2008)
defined that strategy is the direction and scope of an organization over the long
term: which achieves advantage for the organization through its configuration of

resources within a changing environment, to meet the needs of markets and to fulfill
stakeholder expectations.
Obviously, in an area where consumer needs are constantly changing such as
information technology especially software supply, sales strategies need a lot more
special attention. According Vietnam economic news (2018), Information
technology (IT) has been growing at an impressive rate of 30 percent per year,
playing an important role in Vietnam’s socioeconomic development. Aware of this,
more and more businesses are entering the information technology field. This also
means that competition between companies becomes increasingly fierce. Therefore,
in order to attract customers and dominate the market, each company uses different
methods. Because in the consumer's mind, the "winner" emerges with the important
characteristics that satisfy their needs, the goal of administrators is to make
differences. Thus, each company needs to find its own methods and effective
strategies to be able to develop sustainably and strongly.

Student: Nguyen Thi Ngoc Anh

9

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

As a business enterprise in the field of information technology, production of
accounting software, all activities of VACOM joint-stock company are through the
sales network. Therefore, for the company, building a reasonable and effective sales
strategy has a direct influence on the existence and sustainable development of the

company. From the above perception, and the trend of the business environment as
well as the current situation at VACOM joint-stock company, at the same time,
being aware of the practical importance of business strategy for businesses, I have
carried out the topic "Developing sales strategy at VACOM joint-stock company" as
the topic for my thesis with hope to be able to come up with some solutions to help
VACOM joint-stock company develop a more effective sales strategy.
2. Aim of the study
The thesis was concentrated on how to develop sales strategy at VACOM jointstock company by answering two questions below:
1. What was the current situation of sales strategy at VACOM joint-stock company?
2. How to develop an appropriate sales strategy at VACOM joint-stock company?

3. Scope of the study
Due to limited time and space, as well as limited practical experience, the
strategic direction was only within 2 fiscal years of 2019-2020. In particular, the
main task was to focus on developing sales strategies with high potential for
efficiency. The study would be conducted with the participation of the head, the
sales team leader and 18 sales staff from the sales department of the VACOM jointstock company
4. Methodology of the study
There were two main methods used in this study, including (1) documentary
review and (2) questionnaire survey

Student: Nguyen Thi Ngoc Anh

10

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

Firstly, the author collected the material by researching books, magazines,
newspapers or websites related to sales strategy from reliable sources, then,
proposing to develop better and more reasonable in developing a sales strategy for
the VACOM joint-stock company.
Secondly, questionnaires survey was designed to collect information from
employees of VACOM joint-stock company and customers about the current
situation of sales activities at the company, thereby offering solutions to develop an
appropriate sales strategy. The questionnaire consisted of two parts. Part A included
2 questions. The first was about the frequency of activities to develop sales strategy,
including: searching for potential customers, exploiting the market, managing
distribution channels/ agent systems, making weekly sales plans and reports,
proposing new sales plans and organize daily sales management. The second was
about the effectiveness of current sales activities. Questions focused on evaluating
the company's sales process, including pre-sales, while-sales and post-sales. Part B
was to propose solutions to build an appropriate business strategy at VACOM jointstock company.
Besides, SWOT analysis is also used to analyze the strengths and weaknesses of
current business activities, thereby identifying opportunities as well as threats to the
company. This method was created in the 1960s by Albert Humphrey of the
Stanford Research Institute, in a study conducted to determine why business
planning repeatedly fails. Bonnie Taylor, director of marketing strategy at CCS
Innovations, told Business News Daily: “It's impossible to accurately map the future
of a small business without judging it from all angles, including a holistic view of
all both internal and external resources and threats". A SWOT accomplishes this in
four simple steps that even rookie business owners can understand and grasp.”
5. Organization of the study
Besides the Introduction, Conclusion and References, the thesis consists of
three main sections:
CHAPTER 1: Literature review focused on the theoretical background on

sales strategy

Student: Nguyen Thi Ngoc Anh

11

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

CHAPTER 2: The study showed the current situation of sales strategy
VACOM joint-stock company
CHAPTER 3: Recommendations was organized with recommendations, the
orientation and solutions to develop business strategy at VACOM joint-stock
company

Student: Nguyen Thi Ngoc Anh

12

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance
CHAPTER 1: LITERATURE REVIEW

Chap 1 presents the general theory related to sales strategy and provides a basic
background of sales strategy in the Information Technology industry in Vietnam. It
includes three main parts. The first part is about an overview of activities to develop
sales strategy in the Information Technology industry in Vietnam. The second part
consists of measurement and assessment of the sales strategy. The third part
provides data about factors affecting sales strategy of the company.
1.1. Overview on sales strategy in Information Technology industry in Vietnam
1.1.1. Overview on sales strategy in Vietnam
1.1.1.1. Definition of sales/ sales strategy
There are many related concepts that are understood by many administrators in
many different ways. Although the skills required are different, from a management
viewpoint, according to Philip Kotler (2000), sales mean a part of marketing. Sales
often form a separate grouping in a corporate structure, employing separate
specialist operatives known as salespersons. Sales are considered by many to be a
sort of persuading "art". In the business dictionary, the definition of sales is as
follows: The activity or business of selling products or services, or an alternative
term for sales revenue or sales volume. Sales is not about trying to convince
potential customers, or developing the most persuasive tactics to get people to part
with their money. When this is your business strategy, people can sense it - and it is
a bit of a turn off. The aim of sales is to provide a timely and cost-effective solution,
which naturally equates to a win-win situation.
According to business dictionary, the definition of a sales strategy is “a planned
approach to account-management policy formation, prospect identification and
qualification, sales presentation, and order generation aimed at achieving a firm’s
sales quotas or targets”. Besides, according to marketing dictionary, sales strategy
sets out a detailed plan on how to get the product and service in front of the right
people who need it. Sales strategy is based on business plans and marketing
strategy. Sales strategy is important in allocating sales resources efficiently in
Student: Nguyen Thi Ngoc Anh

13

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

driving selling costs down and marking up the revenues. Besides, in 1962 Chandler,
one of the people who initiated and developed the theory of strategic management
said that: strategy is the identification of targets and long term goals of the business,
and the acceptance of the action sequences as well as the allocation of necessary
resources to implement this goal.
In short, although each administrator has its own approach to research, it should
express different concepts, but in the end, it still revolves around the following main
contents: Sales strategy means an approach to selling which allows the sales team of
an organization to position the company and its products to the customers in a
differentiated and more meaningful way. Many strategies have an in-depth line of
best practices as well as processes that are given by management. Sales strategy
focus on defining short-term and long-term goals of the business, making a plan to
achieve the goals and selecting of policies and implementation and allocation of
resources to achieve that goal.
1.1.1.2. Types of sales strategy
According to David Gargaro (2020), there are generally two types of sales
strategies that are employed by a business, including direct and indirect.
Direct Sales Strategy
Direct sales strategy involves selling your products or services directly to the
customer, who would make purchases through your sales staff, in your store, on

your website, at a trade show or through mail order. In a direct sales strategy, sales
people while talking to the consumer attack their competitors head on. They try to
compare each feature of the competitor’s product and compare it to theirs. The term
direct sales approach also refers to ‘negative selling’. A direct sales business
removes the middlemen involved in product distribution, like a regional distribution
center and wholesaler. Instead, products go from the manufacturer to the direct sales

Student: Nguyen Thi Ngoc Anh

14

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

company. If you are a distributor (i.e. a sales representative) working with a direct
selling business, then the manufacturer gives you the products to ultimately sell to
the consumer.
Types of direct sales strategy:
Person-to-person sales: arranging individual appointments with customers to
make presentations, demonstrate new products, or arrange product tests or fittings.
Door-to-door sales: approaching homes and businesses by appointment or
unannounced to leave catalogues and offer products or product demonstrations.
In-home presentations: arranging parties and at-home gatherings to present
products (often called 'party plan').
Online shopping: using websites and email lists to build customer networks and
offer online ordering facilities.

Venue sales: setting up booths or kiosks at events to generate new leads and
promote and sell products.
Network marketing: recruiting other sellers into a network to 'duplicate' your
product sales role, earning a percentage of their sales revenue and expanding your
product reach.
Indirect Sales Strategy
Indirect sales involve using a third party (e.g., partner, affiliate, distributor) to
sell your company’s products or services. Customers could purchase your products
or services at physical locations (e.g., retail stores, warehouses) or online (e.g.,
resellers’ websites, Amazon). In other words indirect sales approaches are more
subtle in nature and are implemented by demonstrating features and benefits that are

Student: Nguyen Thi Ngoc Anh

15

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

not available with the competitor’s products or services without ever mentioning
about any competitor’s products. This technique is more sophisticated. Indirect sales
strategy can be an effective way to increase your footprint without hiring additional
staff. Indirect sales occur through a third party, such as a partner, affiliate or
distributor. Businesses rely on indirect sales to grow sales without hiring additional
sales staff. Indirect sales reduce control over the product or sales process and
require sharing revenues.

How do indirect sales work?
Indirect sales enable your company to increase sales quickly without hiring
additional sales staff. You can combine both direct and indirect sales approaches to
sell your products or services, where indirect sales will support what your in-house
sales personnel are doing. You can also use indirect sales to expand into new
markets or grow your existing markets. Some companies will use indirect sales to
handle an increase in demand for its products or services, which would be more
efficient than hiring more experienced salespeople.
Indirect sales channels
There are four main types of indirect sales channels:
Affiliates are companies that sell products or services in exchange for a
commission. This includes third parties that serve as intermediaries to link the
company to affiliate sellers. Affiliates are only paid when they make a sale. You can
provide affiliates with advertising and marketing tools for increasing traffic and
growing the business.
Resellers sell directly to customers in face-to-face settings (e.g., retail stores,
wholesalers, dealers), representing the manufacturer of the product. This is a
common practice in the software and hardware industries. For example, a customer

Student: Nguyen Thi Ngoc Anh

16

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

might purchase a smartphone from a telephone and Internet service provider’s store
(the reseller) rather that the manufacturer’s store. Resellers are typically paid
through a margin percentage or profit percentage on each sale.
Independent sales representatives are individuals who are hired on an as-needed
basis to sell the company’s products or services. They can be added or removed as
needed, which lowers the company’s overhead. One common example is an
insurance agent who is paid on commission for the generation of new customers
and renewal business.
System integrators are consultants who provide customers with specific solutions
to their issues. They typically work in B2B product or services sales. For example, a
system integrator might work with a company that provides hardware and software
products as well as tech advice, and would provide sales and consulting services.
1.1.1.3. Activities to develop a sales strategy
Searching for potential customers
As a business owner, you're no doubt keenly aware that your client base is the
lifeblood of your company. A steady stream of new customers allows you to grow
your business and fulfill your company vision. Former OPEN Forum community
member Farzana Irani also realizes the importance of a strong client base for all
small businesses, including virtual ones. "Attracting more customers is really about
listening to their needs, not being a solution looking for a problem," says Paige
Arnof-Fenn (2008), founder and CEO of Mavens & Moguls, a strategic marketing
consulting firm whose clients include Fortune 500 companies as well as early-stage
and emerging businesses. "There are many existing problems out there that need to
be solved that customers are willing to pay for today."
Exploiting the market
Exploiting the market runs the gamut from very simple qualitative research to indepth quantitative analysis. It can be done very quickly and inexpensively by
Student: Nguyen Thi Ngoc Anh

17

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

sending surveys to your existing customers using one of the many online survey
tools. But depending on the questions you are trying to answer and your research
budget, your market research can involve more extensive interviews with customers
and qualitative studies on how target customers feel about your business, its
products and services. Certain products and services may appeal to one audience but
not to another, so understanding the strengths, weaknesses, opportunities and threats
in your target market is critical.
Managing distribution channels/ agent systems
An effective distribution plan will help place products where those who want or
need it will take notice. The company must also have a distribution system that
ensures what has to offer actually reaches end-users. Besides, the distribution
system needs to fit in it with the rest of the business including different products
that lend themselves to different distribution systems, will that distribution system
also allow for follow-up service? Are you competing for shelf space? Is location a
factor when trying to get your product out?
Making sales plans and reports
Once a company establishes a business plan, each department could use a
department-specific business plan to set benchmarks and goals. The sales
department is first and foremost in its need for a department plan. Sales plans detail
elements such as the objectives of the company and how the sales department will
meet those goals. Your sales business plan should speak to the company's overall
plan. There is no one-size-fits-all sales plan; however, there are templates – which
we'll discuss later – that can get you on your way to a realistic and successful sales

plan.
1.1.1.4. The importance of sales strategy in business operations

Student: Nguyen Thi Ngoc Anh

18

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

The company operates without a strategy like a person goes on the road without
determining where to go, he just moves according to any direction of the crowd
(market and competitors). If he keeps on walking like that, he will forever be a
mediocrity in the crowd. According to Mintzberg (1987), the company needs to
have strategy because strategy allows business: to establish long-term orientations
for the business, to focus the efforts of the company in the implementation of tasks
to achieve expected goals, to determine the mode of organization and action in
accordance of desired goals and to build the steadiness and harmony of the
organization.
In my own opinion, three basic benefits that strategy brings are: to build
competitive advantage by creating high and unique value; to plan the activities of
the company and to ensure efficient usage of resources. They are 3 basic benefits
because deriving from the definition of strategy, the primary purpose of strategy is
through the orientations and the rational allocation of necessary resources to create
advantages for the organization. And these benefits also three core objectives that
the strategist looks for when create strategy.

Firstly, the strategy helps businesses to build competitive advantage by creating
high and unique value. Competitiveness is the ability to win the competition
between subjects in the same environment and having the same interest in the same
object. The competitiveness of a product is measured by the proportion of that
product. Therefore, the right strategy will greatly affect the competitiveness. It
depends on the seller's quality, price, speed of delivery, included services,
reputation, brand, advertising, terms of sale. A company's competitiveness
demonstrates its strength and advantage over its competitors by the way it meets
customer needs and generates higher profits.
Secondly, strategy helps the company to plan its activities. Strategy plays an
important role in the formulation of the company's operations. What many people
call "the plan" sometimes is only a few numbers of sales, outputs, profits and
expenses. Others also have plan but it does not have high quality, which means
Student: Nguyen Thi Ngoc Anh

19

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

between plan and the implementation has far distance. Indeed, the reason why many
companies find it difficult in planning is because the company does not have a
strategy. The plan is set out but the implementation is successful or not depends
largely on strategy. An action plan that is built on the basis of a right strategy is
always feasible than the action plan that is based on subjective desire of the people
who set the plan. Chandler (1962) asserted that "market is like battlefield, if the

strategy is basically correct, even with a number of tactical errors, the company can
also reach the intended target". Thus, when having a good strategy, though in the
process of implementing the strategy the company may make a certain number of
errors or even its starting point is in a weak position, the company can still achieve
the intended target.
Finally, strategy ensures the company uses its resources effectively. Resource of
a company is understood as the ability to provide the necessary elements for the
survival and development process of the company. The main resources of the
company: information, finance, human resources, machinery and equipment , fixed
assets , customers, suppliers , manufacturing process and technical process of the
company, the management capacity, the business capacity, brand and reputation of
each product, each services and of the company. Each type of resource has a
particular and irreplaceable importance. Using these resources economically and
effectively is indispensable, it requires administrators to respect and develop
reasonably, to ensure harmonious relationship between resource elements. Even at
the national level, using resources rationally and efficiently is also problem that
needs to be solved fiercely. Because national resource is limited and when the
economy does not develop at high level, if the Government only interests in growth,
they will have to spend a lot of resources.
In short, sales strategy in particular increasingly asserted its importance,
especially in the market economy with high competitive. Building a good strategy is
the strong foundation for sustainable growth of the business. Building strategy is the
work of the administrators and it requires managers to have specialized knowledge,
Student: Nguyen Thi Ngoc Anh

20

Class: CQ55/51.01

Graduation Thesis

Academy Of Finance

abilities and work experience. Any business should also have strategy to develop
but the strategy of each business must be different and this company cannot mimic
the way of other companies. In business, following others or imitating others, the
company will never get its own sky. Only those who have the courage to go ahead
of others would have spectacular success.
1.1.2. Overview on Information Technology industry in Vietnam
According to the research of Office company (Offshoring in Vietnam) (2020),
Vietnam’s information technology are still young but it has been becoming in
rapid growth. Following the regional countries in the region such as India and
the Philippines, the IT outsourcing services in Vietnam is developing gradually.
According to Visa, Vietnam’s outsourcing enterprises have made inroads
gingerly into the markets of the US, Japan, and several European countries over
the years, and generate around $3B a year. Furthermore, according to the Japan
External Trade Organization, in recent years, Vietnam has overtaken India to
become Japan’s second-largest software outsourcing partner after China, which
accounts for around 21% of the market.
In particular, software outsourcing industry is increasing faster in the next
three to five years. For years, some giant multinational corporations like Intel,
LQ, Nokia, IBM, Samsung, and Microsoft have chosen Vietnam to outsource
their software products and move an inflow of high-tech manufacturing
operations to Vietnam. According to the Ministry of Information and
Communications, Vietnam exported $3.5 billion worth of software in the
previous year.
To understand such strong growth, and what is contributing to it, we examine
five sub-sectors that show potential and are currently trending in Vietnam’s IT
sector.

Student: Nguyen Thi Ngoc Anh

21

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

Fintech
A rising middle class, growing internet usage, and a young population present a
great combination for the Fintech sector to thrive. An estimated 120 companies and
brands cover a wide range of services, from digital payments to wealth management
and blockchain.
Digital payments are the most popular segment, with mobile payment apps
MoMo, Moca, and Zalo pay leading the way. Peer-to-peer lending (P2P) is also
becoming increasingly popular, with Tima, Growth Wealth, and Trust Circle among
the most popular.
Blockchain and cryptocurrency is the third segment in this sector that is
increasingly gaining traction. Several companies like TomoChain and Kyber
Network deal in cryptocurrency, allowing consumers faster and cheaper
transactions. In 2018, Vietnam held its first-ever international conference on
blockchain and its potential for development in the country.
Artificial Intelligence
The artificial intelligence sector (AI) industry in Vietnam shows strong potential.
While still developing, AI in the country has followed global trends in application to
human resources, education, healthcare, agriculture, transport, and e-commerce.

A good example of how AI is being used domestically can be found in Vietnamese
conglomerate FPT Corporation, which has used AI for smart traffic in Ho Chi Minh
City. Viettel Group has used AI in endoscopy for their operations in Vietnam. Viettel
is also using AI to fight cyberattacks and help businesses deal with internal IT
security.

Student: Nguyen Thi Ngoc Anh

22

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

In August, the government issued Resolution No.50-NQ-TW, encouraging FDI by
increasing the number of businesses to 50 percent by 2025 in advanced technology
and Industry 4.0 – this could help develop AI further.
E-commerce
Vietnam’s e-commerce market could be ranked third after Indonesia and
Thailand by 2025, according to the E-Business Index 2019 report by the Vietnam ECommerce Association.
Vietnam's e-commerce activities take place most actively in Hanoi and Ho Chi
Minh City. Sales from these cities account for 70% of total sales in the country. This
presents a significant opportunity to penetrate the rural market - rural internet
connections are strong and most of the population lives there.
Domestic e-commerce firms such as Shopee, Sendo, and Tiki operate websites
that compete with regional players like Lazada and Shopee. Consumers also use
social media like Instagram and Facebook for e-commerce.

Over the last four years, Vietnam’s internet economy has attracted over US$1
billion in funding, but customer trust, high competition, and logistics costs remain
challenges for e-commerce companies in the country.
Software outsourcing
Software outsourcing has gained traction over the last decade in Vietnam.
According to a survey by US-based software vendor Better Cloud, 73 percent of
organizations will use software outsourcing.
Vietnam has emerged as a cheaper outsourcing destination compared to
traditional markets, such as China and India. This helped the software industry

Student: Nguyen Thi Ngoc Anh

23

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

reach revenues of US$8.8 billion in 2018, according to the Vietnam Software and IT
Services Association.
The government is developing high-tech parks and is also offering several
incentives to further the industry. For example, Da Nang has developed as a
software outsourcing center, particularly for Japanese businesses.
Still, challenges exist, and Vietnam needs to develop large scale IT outsourcing to
compete with global players. In addition, more attention will be needed to improve
English speaking skills to cater to global firms.
Education technology

Vietnam’s education technology (Ed-tech) has received investments worth
US$55 million in 2018. This investment is largely driven by Ed-tech centers’ ability
to bridge the gap between traditional education environments and learning needs
inspired by the private sector.
Most recently, Vietnamese startup Everest Education secured a US$4 million
investment by a Hong Kong-based equity firm. Organizations like Everest
Education provide tech-enabled personal learning through a network of centers and
partner schools.
Vietnam’s kindergarten through grade 12 population is a large market with locals
spending up to 40 percent of their disposable income on education. Ed-tech firms
like Violen.vn, Hocmai.vn and Topical have found success in this space. It’s no
surprise that foreign investors from Japan, Singapore, South Korea, and Australia
are showing interest.
1.1.3. Sales activities in Information Technology industry in Vietnam

Student: Nguyen Thi Ngoc Anh

24

Class: CQ55/51.01


Graduation Thesis

Academy Of Finance

According to the Australian Trade and Investment Commission (2020), the
outlook for Vietnam’s information and communication technology (ICT) market is
strong at an average growth rate of 8 per cent during 2016 to 2020. The ICT
industry (especially software and services where there is huge potential for

increased adoption by enterprises and public sector) is expected to grow
tremendously as Vietnam has emerged as a production center for both IT hardware
and services such as software development outsourcing.
The Vietnamese Government has identified ICT as a key sector contributing to
the country’s development and has devised a Master Plan for Information
Technology, which specifies targets for 2020 and aims at turning Vietnam into an
advanced ICT country. The government has pledged to invest approximately US$
415 million from the State Budget in the ICT sector by 2020 (Source: BMI Vietnam
Information Technology Report 2016).
There are four major ICT focus areas, addressing supply as well as demand:
Improving policy environment, developing IT human resources, developing IT
enterprises and trademarks, products and markets
Attracting investment into build IT zones and open source software, companies
operating in the Vietnamese ICT market can enjoy support measures from the
government such as tax incentives and simplified administration procedures. New
hi-tech parks are set to be constructed between 2015 and 2030 through a
combination of central government direction, local government funds and private
capital. Enterprises located in software or hi-tech parks are offered further support
and incentives. The growth of hi-tech parks is expected to generate demand for IT
products and solutions directly while contributing to the broader dynamic of
economic modernization.

Student: Nguyen Thi Ngoc Anh

25

Class: CQ55/51.01