Client’s Guide: Outsourcing to Vietnam

outsourcing to Vietnam

If you are thinking about outsourcing development to Vietnam, this article is for you. Vietnam has a lot to offer whether you have an IT or software development project or are seeking workforce augmentation. It is a prominent destination for offshore outsourcing due to its location in ASIA.

How to effectively outsource software development and IT projects to Vietnam is a hot subject right now. As the world evolves, more companies than ever are wondering if they should attempt outsourcing in any of its forms – onshore, offshore, nearshore, or hybrid. 

As a result, senior management, CIOs, CTOs, and team leaders are being questioned about how to make it work, and Vietnam is being considered as an offshore destination for software development.

This article will walk you through the advantages and 5 steps to effectively outsource to Vietnam. Let’s find out!

Advantages of Outsourcing to Vietnam

Outsource Vietnam is an outsourcing middleman that claims that, based on their data, outsourcing software development costs half as much in Vietnam as it does in India. In addition to Outsource Vietnam, Anderson Vietnam claims that outsourcing each employee in Vietnam costs just $20,000, compared to $40,000 in India. These statistics are compelling enough to position Vietnam as the leading potential competitor for offshore development projects.

Some advantages of Outsourcing to Vietnam that you should consider: 

Price

Labor costs 90% less in Vietnam than in the United States, resulting in greater money for development. Vietnam is rated fifth on MarketsInsider’s ranking of the “Best countries to outsource to in the World in 2019.”

Vietnam’s workforce earns a low salary in comparison to many other nations, including those in Southeast Asia. As a result, several businesses that formerly had manufacturing operations in other nations such as China have relocated their operations to Vietnam.

In 2019, according to outsource.dev Outsourcing and More, the hourly cost of a coder was as follows:

  • Vietnam $25-$35
  • India $28-$42
  • China $37-$60

On the other hand, the statistic also shows the price between regions:

  • The USA $132-$140
  • Europe $35-$56
  • Latin America $30-$52
  • Asia $24-$35

Workforce

The Vietnamese government acknowledges and supports the value of education and training. Today, the nation boasts a literacy rate of 96 percent, and 80 percent of college graduates have degrees in the sciences (Vietnam Economic Times). Because of its highly educated population and a high degree of scientific and technical literacy, Vietnam is an ideal nation for outsourcing technology projects.

In addition, the workforce has considerably lower turnover and much greater stability than most other nations involved in outsourcing. In general, businesses in Vietnam have an IT-related turnover rate of less than 5%, while in many other countries, such as India, this rate may be 10% or more. Ho Chi Minh is regarded as having a “significantly low attrition rate” and a “strong labor pool” which are two of the primary reasons for the city’s placement on its list of the top 50 outsourcing cities in the globe.

Additionally, Vietnam is one of the most hard-working nations. The young population is hard-working, motivated, and innovative, making them an important asset to compete against competitors.

Economic security

Vietnam’s economy is robust and quickly expanding, with GDP increasing at a 7.4 percent annual rate in the six years leading up to 2005, according to CEIC. According to the New York Times story, Vietnam’s Roaring Economy Is Set for World Stage, published on October 25, 2006, this is the second-fastest GDP growth in all of Asia. In 2005, FDI (foreign direct investment) reached almost $5 billion, which compares well to other countries that are attractive locations for outsourcing labor.

Language

Vietnamese, unlike many Asian languages, utilizes the Latin script, much like English, making it comparatively simple for Vietnamese speakers to learn English. English is the country’s second most popular language, and the majority of college graduates in Vietnam are fluent in it. As a result, most IT employees in Vietnam can readily converse in English while working on outsourcing projects.

Vietnam has competitive outsourcing benefits, but it is critical to examine a company’s particular objectives and requirements before engaging in an agreement with a Vietnam-based outsourced service provider. Therefore, the next 5 steps will help you find out how to effectively outsourcing to Vietnam.

The ultimate guideline to Outsourcing to Vietnam

Step 1: Scoping the project and defining objectives

The portion of project planning that includes defining and recording a list of precise project objectives, deliverables, features, functions, tasks, deadlines, and, ultimately, expenses is known as the project scope. In other words, it is what must be accomplished and the labor that must be completed in order to complete a project.

One of the most frequent causes for a project’s failure is a lack of mutual knowledge of the project’s background and goals. When it comes to offshore, this problem is compounded by the fact that your partner is likely to be unfamiliar with not just your company but also your culture and market environment. That is why, before launching any additional effort, it is critical to precisely define your company requirements and the objectives you intend to achieve. As a result, create a list of specific needs, attempting to be as comprehensive as possible while being succinct. Project timelines, deadlines, contract length, the scope of work, intended product functions, features, and technologies, and so on are typical items to mention.

You can keep track and record the process by using some excellent tools such as Trello, Google Sheet, Microsoft Project, Slack, or Notion. 

Step 2: Listing potential software outsourcing firms and filter them down

The first question you may have is where you can find these Vietnamese outsourcing companies. You may begin with the following main sources:

  • Referrals: This is not always the greatest, but it is generally the safest option. If you know anybody in your network who is familiar with the IT outsourcing environment in Vietnam and has first-hand experience there, seek their counsel. Even if you do not end up employing the companies they suggest, there will be a lot of valuable information you may get, particularly for benchmarking and rate comparison.
  • Search engines (most notably Google): almost anything you need can be found on Google. However, you run the danger of becoming lost amid too many choices or, worse, selecting the incorrect ones. To get the most out of Google search results, aim to select terms that are both relevant and diverse in nature. Aside from typical keywords like “software outsourcing business in Vietnam” or “Vietnamese IT outsourcing firm,” consider phrases that are more relevant to your project, such as “IoT development company in Vietnam.” Be wary of superlative terms like “best” or “top,” since they may often be the product of SEO techniques rather than being genuinely “top.”
  • Directories of industries: Clutch.co, G2.com, sortlist.com, and goodfirms.co are some reputable listing sites for the software sector in particular. These websites provide informative vendor categorizations as well as insightful information such as client reviews, benchmarking against rivals, and so on. One thing to bear in mind: the rankings given by the directories are not always relevant to your specific situation. As a general approximation, a place in the top 30 is sufficient to advance. The remainder of your decisions should be based on other factors.

By immersing yourself in those sources while keeping your project’s features and requirements in mind, you will soon notice specific business names that stick out. Reduce your list to a manageable amount (10 or fewer for a small or medium-sized project) and go to the next stage!

Step 3: Contacting and selecting the right team

Your list has been refined as a result of extensive research. Begin by contacting each of the businesses you pre-selected and discussing your plans with them. During the conversation, attempt to uncover and evaluate any insights that are not clearly shown on public channels, such as their resource availability, communication skills, problem-solving competence, degrees of knowledge, project outcomes, and so on. Based on this discussion, you may short-list and prioritize 3-5 offshore partners who are the greatest match for your project. Continue working with the top vendor while keeping the rest on the list as a backup plan.

Step 4: Making a contract that works for both

It is now time to strike a contract with your selected outsourcing partner. Contract specifications may vary based on your specific situation. Payment terms, responsibility, warranties, notice periods, confidentiality and data protection, intellectual property rights, non-solicitation clause, and jurisdiction are all important considerations. There are three major pricing models for contract types: fixed-price, time & material, and committed team. To create a win-win scenario and limit possible dangers, don’t undervalue any one contract aspect. It is certainly worthwhile to speak with a lawyer since an excellent contract can help you avoid problems in future collaboration with your outsourcing partner.

Step 5: Communicating and managing effectively 

Communication breakdowns are among the most frequent causes for an outsourcing project to fail. To avoid this problem, efficient communication routes and management mechanisms must be established and agreed upon by all stakeholders at an early stage. To guarantee mutual understanding and problem-solving ability, regular updates and follow-up through meetings or reports should be scheduled. You may utilize pre-built project management solutions such as Trello, ClickUp, Jira, and Asana.

Why JSLancer when Outsourcing to Vietnam? 

JSLancer is a rapidly expanding software development outsourcing company. We have become a trusted technology partner for businesses all around the world, from the United States to the United Kingdom to Australia and Singapore, by putting the client first. Our tight-knit team is made up of experienced engineers that can tackle tough issues and offer the best solution for your product, allowing you to focus on strategy, business development, and user growth without concern.

Working with JSLancer, you will leverage the benefits of outsourcing to Vietnam such as cost, workforce, or language. In addition, we provide the most reasonable service by consulting carefully our customers, so we can find out the best solution. Moreover, our dedicated team is built of high-quality, professional developers and fluent English speakers. The process can be listed briefly as below: 

  1. Leave your contact information & discuss first ideas
  2. Discuss and carefully consult about the suit solution based on the first ideas
  3. Working on the proposal.
  4. Process the work.

JSLancer has a consistent, effective customer care management system. Therefore, you can observe the process better and be supported even after the project. Our outstanding services: 

  • Development of web and mobile applications. JSlancer focuses on IT solutions so that you may focus on what is most essential to your business. JSLancer respects each client’s idea and is delighted to make it a reality. Based on our vast experience in providing offshore software development services, we have developed a wide range of consumer and enterprise-oriented applications. JSLancer offers high-end consulting services such as expert guidance and project management for website design and web app development in addition to website development services for different sectors.
  • MVP Software Development is a company that specializes in software development. JSLancer offers end-to-end MVP software development to help you save time and achieve your objectives. With JSLancer’s service, the MVPs software development process may now become easier and more accessible to a variety of businesses across markets, understanding that time and cost are two of the most pressing concerns for SMEs. By helping companies from the start, JSLancer can provide solutions that are tailored to their specific needs and challenges.
  • Software Reengineering. JSLancer offers application re-engineering services to improve the commercial efficiency of your websites and mobile applications. We utilize re-engineering techniques to evolve your existing software applications that are out of date or are not supported by software providers by a third-party IT team in order to keep your software and business processes up to date with the most recent technology available globally.

Contact us via: 

  • Website: jslancer.com
  • Phone: 
  • Email: hello@jslancer.com

Conclusion

Vietnam has competitive outsourcing benefits, but it is critical to examine a company’s particular objectives and requirements before engaging into an agreement with a Vietnam-based outsourced service provider. More information on selecting the appropriate outsourcing partner for your company may be found here.