Vietnamese entrepreneurs’ current prosperity and success is directly linked to the country’s culture and history. Vietnamese entrepreneurs have made a great contribution to the economy, and their creativity and dynamism impress their foreign counterparts. Figures show that hones entrepreneurs have made not only themselves but also the nation affluent. In a series of interviews, entrepreneurs told the researchers they rely on reputation and gossip to select partners. They try to avoid disputes by checking their customers’ financial backgrounds and personalities with others who have done business with them. Results show that Vietnamese entrepreneurs are motivated by the ability to provide jobs for themselves and family members, to gain public recognition, and to prove they can successfully run a business of their own.
Important perceived entrepreneurial success factors include friendliness toward customers and a good product at a good price while significant business problems include too much competition, unreliable employees, and the inability to obtain both short term and long term capita. Vietnamese businessmen and entrepreneurs are very positive experience. Their enthusiasm, creativity and attitude toward business are their key strengths. In addition, their ability to learn fast, pick up new trends and use modern technology provides them with essential tools when doing business. Vietnamese entrepreneurs are now soldiers on the economic front. Creating the best possible conditions for entrepreneurs to work and contribute the development of the country is one of the most important tasks. The law on enterprises has been implemented to foster the formation of a class of entrepreneurs in the country.
Vietnamese people are young and entrepreneurial in spirit. During the past few decades, northerners were conditioned to centralized planning and strong limitations on entrepreneurship. Today, the south, particularly Ho Chi Minh City (formerly Saigon) still has a decidedly younger and more entrepreneurial culture than its northern counterpart, Hanoi. While southerners have retained their entrepreneurial spirit, however, the northerners are generally better educated.
Today, the business environment has seen great improvement and authorities at all levels have recognized the important role of entrepreneurs in national economic development. The government and related central and local authorities are to play more supportive role in the training and development of Vietnamese entrepreneurs. The Vietnam government supports investment in sectors where there is high growth potential and encourages joint ventures, business cooperation and enterprises with 100% foreign ownership.
However, a lack of adequate institutions, and a shortage of available capital are holding entrepreneurs at bay, and slowing the country’s move towards a market-oriented economy.
- After Vietnam War and the Reunification, the Communist government followed the old Soviet style economy.
- In 1986 the government started market economy reform (Doi Moi): a balanced approach to developing both industry and agriculture, with a mix of state, collective, and private ownership.
- Most large firms remain under state ownership, but the role and number of private enterprises has steadily increased. Most enterprises produce consumer goods for the domestic market, although a growing number of manufacture goods for export, notably textiles and processed foods.
- It is now easier for overseas businesses to set up operations in Vietnam, especially if they fall into certain categories such as export manufacturing or the service sector that supports the exporter.
- While some areas are restricted and regulated such as retail distribution, telecommunications and banking, the Vietnamese government welcomes wholly foreign owned companies in most areas.
- Getting a business license is much faster now than it used to be — it used to take a year to get a wholly foreign owned license, now it takes a matter of weeks (Quest & Stein, August 23, 2005).
- Vietnam’s banking sector has expanded rapidly in recent years mostly by supplying loans to the private sector. Despite the sector reform underway, the banking sector remains financially weak.
- Four large state-owed commercial banks (SOCBs) still account for about 70% of all credit. Institutional investors and non-bank financial intermediaries are still embryonic. There is no institutional investors, so that the banking sector risk is high (World Bank, May 2006).
- Bank loans are not easy to obtain for small businesses.
- Vietnam Stocks Market started trading since 2008. However, there is also an unlisted stock market that is much larger than the formal stock trading centers (STC), indicating the potential of the market to grow.
- Social harmony, stability and the welfare of the society are still more important than individual’s rights.
- It is very important to know the “right people” when doing business in Vietnam. Bribery and corruption are common.
- Vietnamese managers are more accepting of hierarchical and formal management structures; more collectively-oriented, putting less emphasis on individual actions and achievement.
- The Vietnamese legal system is in its infancy: there is as yet no commercial code, no body of law and judicial precedents familiar to Western investors.