Vietnam Successful in Applying E-commerce

The E-commerce and Information Technology Department under the Ministry of Industry and Trade has recently announced survey results on information technology and electronic commerce application (EC) in more than 2,000 companies in Vietnam in 2009. The survey shows that almost all companies are successfully and efficiently applying e-commerce.

Widely-applied IT

According to the report, 100 % of surveyed companies had computers and each company has 25.8 computers on average. As much as 98 % of enterprises had internet connections in many different forms. Companies also used basic applications of e-commerce, like 86 % using email for business purposes. Up to 95 % of large companies use emails while 78 % of small and medium enterprises employ this communication method.

The most outstanding feature e-commerce application in 2009 is the growing rate of software used for business and production activities. Most businesses were using accounting software and many businesses had considerably invested in specialised software like human resources management software, supply chain management software, customer management software, etc. These software programmes helped optimise operations and improve production and business efficiency of enterprises. Besides, most enterprises used online public services offered by State agencies. The effect of e-commerce applications in 2009 was very clear. Investment costs for IT and e-commerce accounted for only about 5 % of total expenses but an average of 33 % of revenues came from orders through electronic means and companies also spend an average of 28 % of purchasing costs on electronic channels.

According to a survey conducted by the Ministry of Industry and Trade, the level of information technology applications in local businesses is growing very fast, with 53 % out of a total 2004 surveyed companies not coming from Ho Chi Minh City and Hanoi, the two largest commercial hubs in Vietnam. According to survey results, to date, 100 % of local businesses had computers, each of them had 21.5 units on average and 10.3 staffs had a computer. Most businesses had internet connections, most using ADSL broadband lines and only some 2 % using dial-up connections. The survey result also showed that only 2 % of companies did not connect to the Internet.

E-commerce boom

Internet-based trading is now the most popular method, mainly through e-commerce websites. To date, many companies are selling their goods and services through e-commerce websites, specially airlines, travel firms, supermarkets, etc.

By the end of 2009, the trading through e-commerce websites became quite popular for some kinds of goods and services like air tickets, electronics devices, cell phones, computers, books, travel tours, hotels, perfumes and flowers. Payment methods and deliveries are very flexible, depending on requests of buyers like online payment, bank transfer or cash on delivery.

In addition to e-commerce websites, e-commerce is also conducted on social networks where attracts hundreds of thousands of members. With a large number of participants, social networks have become real marketplaces for many businesses. Many companies and individuals have proper investments to capture potential market segments such as creating topics and hiring fixed spaces for showing their products and services. Sellers directly exchange and transact with customers on topics and use flexible payment methods for their goods and services sold.

Especially, in sectors requiring highly advanced e-commerce applications like stock market, the application of online public services related to commerce has developed very strongly. After four years implementing the Decision 222, ministries, branches and localities have achieved many positive results like issuing electronics certificates of origin (eC/O) by the Ministry of Industry and Trade, piloting e-customs procedures by the Ministry of Finance. Nationally, 18 provinces and cities have provided online public services for business licensing, business registration, representative office establishment permit granting, enterprise establishment permit granting.

However, according to the Ministry of Industry and Trade, there are some challenges and barriers against e-commerce, including impractical legal framework, inadequate popularisation of e-commerce, weak awareness of contract fulfilment, weak monitoring mechanism and especially insufficient dispute settlements.

Tags: Vietnam ecommerce, Vietnam IT