Logistics enterprises must stand on their own feet

In recent years, FDI enterprises have been entering the Vietnamese market. The purchasing and joining trend is quite common in many fields. How do you rate this trend in the logistics sector?

For Vietnamese enterprises in general, not only logistics enterprises, especially those which Vietnam opens to foreign-invested enterprises, but also FDI enterprises have advantages over capital, technology and skills of management. Over time, the trend of purchasing and joining incurred the situation of small domestic enterprises being acquired by foreign enterprises or large domestic companies.

This trend will not change much over time. Over time, small businesses might not exist any longer. In my opinion, in the next 8-10 years, this will be very clear. The very small logistics enterprises will not exist any longer, or the enterprises will merge with large enterprises or turn to other business fields. Small businesses can only exist when they have a methodical and professional strategy with professional and good quality service and good links with other companies in the same industry as well as outside.

Looking at the "picture" of logistics, domestic enterprises are "lagging" when FDI enterprises occupy a large market share. According to you, this "race" is unbalanced, what can domestic enterprises learn from FDI enterprises to gradually "grow up"?

Normally, when FDI enterprises enter Vietnam, they will not occupy their market share right away. This is the period when foreign companies get to know the market through the logistics companies in Vietnam. If Vietnamese logistics companies can strategically take advantage of technology, especially management skills of FDI enterprises, it will be very good. In addition, the domestic logistics firms can learn how to apply information technology that is used by foreign enterprises. In fact, over the past time, there are still Vietnam logistics companies being able to learn and grow strongly.

In addition, it should be noted that when FDI enterprises enter Vietnam, they are struggling in the market, the domestic logistics companies need to see and fill a gap in the market. Logistics must have the attachments of production and trade, there should be logistics in the automotive, textile, medical, seafood ... businesses should focus on strength and quality. Businesses need to plan very carefully about their development strategy.

In the world, the logistics sector clearly sees the division of enterprises’ market share. For example, fast-moving consumer goods, textiles, frozen goods ... have large businesses. Vietnamese logistics companies, though small, can also divide the market share. If done, it will be the strength of Vietnamese enterprises when joining a large logistics enterprise. When FDI enterprises enter Vietnam, domestic enterprises are more specialized, FDI enterprises do not lose investment, but also take Vietnam enterprises involved in the chain.

How do you evaluate the implementation of the "Action Plan for Competitiveness Enhancement and Development of Logistics Services to 2025" approved by the Prime Minister in mid-February 2017?

The implementing agency is the Ministry of Industry and Trade. In the Action Plan above, there are 60 tasks, involving different ministries and branches. From the ministries to the provinces, associations, even universities ... are all helping hands on how to make logistics grow with potential. There has never been such a plan of action.

Over the past year, the Ministry of Industry and Trade has made great efforts in supporting the provinces, departments and agencies in implementing this Action Plan. It can be said that the plan had a good start, but the results can not be evaluated immediately. The results will be implemented in each area, such as infrastructure, legal policies, training ... All these are a rich and complex "picture", it is necessary to assess in stages. It is now a good time to review what has been done in the past and where to continue to adjust.

It can be said that the 60 tasks mentioned in the Action Plan are quite perfect, covering all aspects of logistics. In the ideal case, if the entire content of the plan is effectively implemented, the competitiveness of Vietnamese logistics enterprises will be improved significantly, and at the same time, enterprises will know how to fill the gap among the logistics companies in a Vietnamese alliance with production enterprises, and import and export enterprises.

However, the implementation of this plan is not simple because the coordination between agencies, ministries and provinces is limited. For example, the Plan mentions the development of logistics centers. Quang Ninh province has developed its center. Ha Noi and Bac Ninh are also developing logistics centers ... Looking at the "picture" overall, the logistics center of Bac Ninh will be close to the Bac Giang center .This causes waste.

The Ministry of Industry and Trade as the focal point needs to follow the Action Plan to achieve the desired results. This needs the support of the Government, it is necessary to have a clear coordination mechanism and be more effective.

Some opinions suggest that there should be special support mechanisms for domestic logistics enterprises so that they will gradually grow and be competitive enough to make full use of the advantages gained during the integration process. What is your point of view?

I do not fully support the support mechanism for domestic logistics companies. Vietnam has been opening up since 1986 and they have been deeply integrated into the economy. Vietnam joined the World Trade Organization (WTO) in 2007, then by 2014 it had to fully open its logistics services to foreign businesses. About 7 years is the time logistics enterprises in Vietnam have had to prepare, but they have not prepared. At present, the state policy has been very supportive, facilitating the logistics industry. Enterprises must stand on their own feet.

Thank you very much!