Foreign firms optimistic about potential of Vietnam's warehouse sector

The growth of e-commerce will lead to an upswing in warehouse demand in Vietnam, which is still in a relatively nascent stage and accounts for only 5.5 percent of total retail sales, he said.

Foreign firms optimistic about potential of Vietnam's warehouse sector hinh anh 1

Foreign firms optimistic about potential of Vietnam's warehouse sector.

Despite negative impacts of the COVID-19 pandemic, Vietnam continues to be an attractive destination for foreign investors, especially those operating in the warehouse sector thanks to its advantage of geographical location and skilled labour force, according CEO of BW Industrial Development JSC Lance Li.

While the pandemic left the world grappling with supply-chain and logistical disruptions, the demand for warehouses has soared due to overwhelmed transport networks and a surplus of raw materials to ward off inventory shortages, Mingtiandi.com of Thailand quoted Li in its article on November 28 as saying.

The pandemic has certainly led to an unfortunate series of events, however, from a business perspective, it’s been an accelerant for warehouse demand, Li said.

With a skilled and relatively inexpensive workforce, rapidly improved infrastructure, and a growing number of trade agreements that Vietnam is a part of, including the ASEAN Free Trade Area, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the European Union-Vietnam Free Trade Agreements (EVFTA), and the Regional Comprehensive Economic Partnership (RCEP), Vietnam continues to be an attractive destination for foreign investment, he stressed.

The growth of e-commerce will lead to an upswing in warehouse demand in Vietnam, which is still in a relatively nascent stage and accounts for only 5.5 percent of total retail sales, he said.

Modern, multi-storey warehouses are also on track to be rolled out faster in the next few years, particularly around Hanoi and Ho Chi Minh City, where land prices are high and strategic locations are in short supply, he said.

Vietnam has been a key beneficiary of the reallocation of manufacturing and supply chain activities to Southeast Asia, he noted.

The tremendous growth potential in e-commerce and high FDI influx to Vietnam have given foreign investors a lot of confidence, he added.

 

The demand for warehouses has skyrocketed in the past time due to the overloaded transport network and an excess of raw materials to avoid stock shortages.

According to Li, the second year of the COVID-19 pandemic has been an active year for BW. At the beginning of 2021, the company witnessed a threefold increase in rental enquiries compared with the same period last year.

The company recently closed a deal with J&T, a company engaged in logistics and package delivery, for a 5 hectare warehouse in a strategic location in Ho Chi Minh City.

Meanwhile, Wanek Furniture, a key manufacturing company in the supply chain of one of the largest furniture retailers in the US, Ashley Furniture, leased another 4 hectare site from BW in the southern province of Binh Duong.

Market demand skyrocketed in the past two years, making BW’s factory in VSIP 2A industrial park in the northern city of Hai Phong is already fully occupied following its construction completion in early June 2021.

The health crisis is an opportunity for manufacturers and warehouse operators alike to rethink their inventory strategy, Li said.

The global shipping industry’s lack of containers left warehouses jammed with cargo for quite some time before exporters were able to load it onto ships, Li said, adding that these circumstances increased the demand for warehouses like never before./.

Source: VNA

 
 

Other News

.
Vietnam coffee industry targets US$6 billion export value in 2030
Vietnam coffee industry targets US$6 billion export value in 2030
BUSINESSicon  11/01/2022 

The Viet Nam Coffee and Cocoa Association has targeted a coffee export turnover of US$5-6 billion in 2030, doubling the export value at present.

Three border crossings to reopen in Quang Ninh
Three border crossings to reopen in Quang Ninh
BUSINESSicon  11/01/2022 

China will resume customs clearance at three border crossings in Quang Ninh Province from January 11, according to the Ministry of Industry and Trade.

Largest-ever support package to strengthen farmers
Largest-ever support package to strengthen farmers
BUSINESSicon  11/01/2022 

The Government has just submitted a support package of VND350 trillion (US$15.43 billion) for socio-economic recovery and development to the National Assembly.

Real estate market anxiously awaits new regulations
Real estate market anxiously awaits new regulations
FEATUREicon  10/01/2022 

The National Assembly this morning began discussing the amending of eight laws.

Tet online sales kick off one month before Tet
Tet online sales kick off one month before Tet
FEATUREicon  10/01/2022 

Everything now can be purchased online, from food for Tet parties to smartphones.

Banks begin to hike deposit interest rates
Banks begin to hike deposit interest rates
BUSINESSicon  11/01/2022 

In October, the average interest rates on bank deposits for six months and 12 months were 4.7 per cent and 5.5 per cent, down half a percentage point from a year earlier, according to Bao Viet Securities Company.

Riding the wave in Vietnam’s real estate market in 2022
Riding the wave in Vietnam’s real estate market in 2022
BUSINESSicon  11/01/2022 

The real estate market has ended a year of profound impacts with some very encouraging news as both domestic and foreign developers are finally speeding up the construction of new projects.

Garment and textiles face reality of fierce global rivalry
Garment and textiles face reality of fierce global rivalry
BUSINESSicon  11/01/2022 

Vietnam’s garment and textile sector has reached the 2021 export target, but is confronted with ever-growing competition from the Asian continent as well as other markets.

Positive indicators light up footwear trade to US
Positive indicators light up footwear trade to US
BUSINESSicon  10/01/2022 

Vietnam is emerging as one of the largest suppliers of footwear and leather accessories to the United States, opening more opportunities for domestic companies to exploit the world’s largest market for these goods.

Goods congestion at border gates needs to be solved before Tet: Deputy PM
Goods congestion at border gates needs to be solved before Tet: Deputy PM
BUSINESSicon  10/01/2022 

Deputy Prime Minister Le Van Thanh has requested ministries, sectors and localities to closely coordinate with Chinese agencies to speed up customs clearance, striving to have no congestion of cargo trucks at border gates before Tet.

HCM City businesses overcome economic 'storm'
HCM City businesses overcome economic 'storm'
BUSINESSicon  10/01/2022 

Many enterprises in HCM City have successfully contributed to the economic recovery and development of the city after the pandemic.

VIETNAM BUSINESS NEWS JANUARY 10
VIETNAM BUSINESS NEWS JANUARY 10
BUSINESSicon  10/01/2022 

Gov’t sets deadline for completion of Long Thanh airport

Positive outlook for insurance stocks as 2022 arrives
Positive outlook for insurance stocks as 2022 arrives
BUSINESSicon  09/01/2022 

State capital divestment planning and the removal of limitations on foreign ownership are expected to drive insurance stocks to flourish in 2022.

AmCham Vietnam to promote increased trade and investment ties in Vietnam
AmCham Vietnam to promote increased trade and investment ties in Vietnam
BUSINESSicon  09/01/2022 

AmCham will continue to work on lowering barriers to trade and creating a high-standard, transparent, and stable business environment in Vietnam.

Economic prospects for the world and Vietnam
Economic prospects for the world and Vietnam
BUSINESSicon  09/01/2022 

The severity and persistence of inflation worldwide have surprised most central banks and organizations that offer economic forecasts. 

Hanoi completes nearly 546,000 square meters of floor area in 2021
Hanoi completes nearly 546,000 square meters of floor area in 2021
BUSINESSicon  09/01/2022 

Despite the ongoing impacts of the Covid-19 pandemic, housing development is still being promoted.

Vietnam's seafood exports beat yearly target, rake in US$8.9 billion
Vietnam's seafood exports beat yearly target, rake in US$8.9 billion
BUSINESSicon  08/01/2022 

Thanks to large-scale production in the last months of 2021, the seafood export value for the whole year rose 6% compared to 2021 reaching more than US$8.9 billion.

First US firm orders 100 VinFast electric cars at CES 2022
First US firm orders 100 VinFast electric cars at CES 2022
BUSINESSicon  08/01/2022 

Artemis DNA has become the first US firm to place an order to purchase 100 electric cars of VinFast following the Vietnamese automaker’s new model debut at the technology exhibition CES 2022 in Las Vegas (USA).

Vietnam becomes major manufacturer of Nike sports shoes
Vietnam becomes major manufacturer of Nike sports shoes
BUSINESSicon  08/01/2022 

Vietnam has surpassed China to become the major manufacturer of Nike sports shoes.

Vietnamese banks facing bad debt increases
Vietnamese banks facing bad debt increases
BUSINESSicon  08/01/2022 

Despite the negative impacts of the Covid-19 pandemic, the credit of the country economy in 2021 witnessed an increase of 13 percent compared to last year. The bad news is an unavoidable rise of bad debts in many banks.

 
 
 
Leave your comment on an article

OR QUICK LOGIN