Delivery franchises booming in Vietnam

Delivery units operating under the franchise mode have been expanding thanks to the strong development of e-commerce.

Obtaining a franchise license from a domestic logistics firm in Ninh Binh in early 2019, Nguyen Thai has developed a network of delivery units covering all districts in the province.

Delivery franchises booming in Vietnam



Thai’s business has more than 900 clients, mostly shops. One COD (cash on delivery) order, for example, can be implemented within a day, with the distance between districts of 120 kilometers.

“The delivery service is growing at a dizzy pace,” Thai said.

The latest survey by the Vietnam Logistics Association (VLA) found that there are 30,000 logistics firms in Vietnam, including 4,000 international freight & forwarding firms. The industry is witnessing a growth rate of 12-14 percent, while the market is valued at $40-42 billion.

What is noteworthy is the shift from traditional business into e-commerce logistics. 

To develop well, businesses not only need to have good technology, but also large networks which cover all provinces/cities.

However, the business field requires huge initial investment capital. To develop well, businesses not only need to have good technology, but also large networks which cover all provinces/cities.

 


Therefore, becoming franchisees instead of developing brands of their own is a good idea. The solution brings benefits to both franchisers and franchisees. The former can expand their networks rapidly, while the latter have existing networks and brands, and they don’t need to look for customers.

Analysts said the market began to be bustling in 2019, when foreign firms such as ZTO Express and BEST Express entered Vietnam.

After one year of development, BEST Express now has seven operation centers, more than 100 service points and has 3-20 such points in one province. In Hanoi, it has 20 service points and in HCM City 26.

VnExpress quoted a source as reporting that at BEST Express, every franchisee has to invest about VND500 million in facilities, a deposit of VND200 million and franchise fee of VND175 million.

As for ZTO Express, it now has 12 service points. Each franchisee has to pay 50,000 yuan, or VND165 million, in deposit for every service point and 10,000 yuan, or VND33 million, in system maintenance fee. However, each service point can only exploit one district.

Meanwhile, SuperShip, a Vietnamese startup, is offering more reasonable franchise fee than foreign rivals. In order to run a service point in charge of delivery orders within one district, franchisee has to pay VND50 million in fee and deposit for a 3-year contract. They also o have to spend VND50 million on facilities.

According to Le Sy Van, a franchisee in Thanh Hoa province, the explosion of e-commerce has led to the strong development of many business fields, especially e-commerce logistics.

Kim Chi 

Delivery services to grow 30-40 percent in 2020

Delivery services to grow 30-40 percent in 2020

The logistics sector is forecast to continue growing strongly this year, with expansion in both retail and e-commerce channels.

E-commerce delivery battle in Vietnam becomes more costly

E-commerce delivery battle in Vietnam becomes more costly

Online buyers in Vietnam are increasingly impatient, driving the war on delivery speed.

 
 

Other News

.
Thai firm buys two wind power farms in Vietnam
Thai firm buys two wind power farms in Vietnam
BUSINESSicon  07/07/2020 

The move aims to take advantage of low interest rates to build projects with a quick return on investment.

FIEs displeased with government demand to license internal websites
FIEs displeased with government demand to license internal websites
BUSINESSicon  07/07/2020 

The new regulations of the MIC may affect the policies and assets of private businesses and foreign-invested enterprises in Vietnam.

New investment wave starts despite COVID-19
New investment wave starts despite COVID-19
BUSINESSicon  07/07/2020 

The new wave of foreign investment triggered by COVID-19 and US-China trade tensions is becoming more visible as outstanding overseas ventures are expanded.

Stronger money policies might be considered to aid economic growth: SBV
Stronger money policies might be considered to aid economic growth: SBV
BUSINESSicon  07/07/2020 

The State Bank of Vietnam could increase credit growth limits for credit institutions this year or even launch stronger monetary policies to aid the country’s post-pandemic growth, Governor Le Minh Hung has said.

Guiding decrees needed to fight with transfer pricing in Vietnam
Guiding decrees needed to fight with transfer pricing in Vietnam
BUSINESSicon  07/07/2020 

Anti-transfer pricing measures were included in the Law on Tax Administration for the first time, but a guiding decree has not yet been written. Experts said this could mean the rules are less effective.

VN corporate bond market to boom in second half
VN corporate bond market to boom in second half
BUSINESSicon  07/07/2020 

Companies are looking to raise debts from bond issuance before the amended Law on Securities takes effect next January.

Moving from former adversaries to trusting and valued partners
Moving from former adversaries to trusting and valued partners
BUSINESSicon  07/07/2020 

Through candid dialogue, mutual respect, and a strong commitment to succeed by the leadership of both countries, Vietnam and the United States created a comprehensive partnership that identifies areas for both countries to work together.

EVFTA expected to give a lift to real estate sector
EVFTA expected to give a lift to real estate sector
BUSINESSicon  06/07/2020 

Many segments of the real estate market are soon expected to benefit from the EU-Vietnam Free Trade Agreement, which takes effect in August.

Whether Apple to build nest in Vietnam?
Whether Apple to build nest in Vietnam?
BUSINESSicon  07/07/2020 

Foxconn’s rush expansion in Vietnam raise nosy that whether Apple will choose the country as the place to build nest.

American groups make progress across Vietnam
American groups make progress across Vietnam
BUSINESSicon  06/07/2020 

Vietnam, as one of the fastest-growing economies in the ASEAN bloc, is becoming more appealing to American investors.

A dynamic and powerful ASEAN from the German perspective
A dynamic and powerful ASEAN from the German perspective
BUSINESSicon  06/07/2020 

Possessing key features that represent a snapshot of one of the most diverse, fastest-growing, and competitive regions, the ASEAN is an attractive economic region for not only German enterprises but also other European ones to invest in. 

Delving into specifics of amended business laws
Delving into specifics of amended business laws
BUSINESSicon  06/07/2020 

Businesses and investors are expected to access new positive changes when the amended Law on Investment and the amended Law on Enterprises take effect from January 1 next year.

Rays of sunshine in aviation clouds
Rays of sunshine in aviation clouds
BUSINESSicon  06/07/2020 

Amid serious impacts of COVID-19, there are hopeful points for the aviation sector on the back of the EU-Vietnam Free Trade Agreement.

Trade kickstart with distinctive solutions
Trade kickstart with distinctive solutions
BUSINESSicon  06/07/2020 

Vietnam is boosting its diplomatic activities in hope of attracting more investment and expanding its trade in the global market, with many of the country’s major partners about to open their doors to the world again.

EuroCham proposes Gov’t to cut 50 per cent of registration fee for imported cars
EuroCham proposes Gov’t to cut 50 per cent of registration fee for imported cars
BUSINESSicon  06/07/2020 

The European Chamber of Commerce in Vietnam (EuroCham) proposed the Government to apply the 50 percent registration fee reduction to all automotive assembly firms, importers and dealers of new vehicles.

Shares to correct amid lack of positive news
Shares to correct amid lack of positive news
BUSINESSicon  06/07/2020 

The benchmark VN-Index on the Ho Ch Minh Stock Exchange (HoSE) gained 0.62 per cent to close Friday at 847.61 points.

P2P firms in Vietnam waiting for a sandbox
P2P firms in Vietnam waiting for a sandbox
BUSINESSicon  06/07/2020 

Peer-to-peer (P2P) lending companies expect that the sandbox for fintech would eliminate unscrupulous businesses and help the market grow significantly.

Business outlook gloomy for firms based in Old Quarter of Hanoi
Business outlook gloomy for firms based in Old Quarter of Hanoi
BUSINESSicon  06/07/2020 

Many business owners in Hanoi’s famous Old Quarter are becoming increasingly concerned about the decline in customers, causing their revenue to sharply decrease, and resulting in many stores closing their doors following COVID-19 epidemic.

Auto dealers deemed main beneficiaries of registration fee cut
Auto dealers deemed main beneficiaries of registration fee cut
BUSINESSicon  05/07/2020 

Auto dealers have proved to be the biggest beneficiaries of the Government's move to introduce a 50% cut in car registration fees, and not car buyers, as expected, 

Nine more expressway contractors suspected of construction violations
Nine more expressway contractors suspected of construction violations
BUSINESSicon  05/07/2020 

Nine more former contractors have been accused of irregularities in the construction of a 139-kilometer-long expressway whose severe deteriotion was reported shortly after its opening in central Vietnam.

 
 
 
Leave your comment on an article

OR QUICK LOGIN