WHY VIETNAM FOR SOFTWARE OUTSOURCING?
We live in the era of globalization. Nothing is limited to just one country. Many companies have people working on the same product in many different global locations. This can be done very easily by software companies. Software development companies do not need all the programmers working on the same project to be in the same location.
They can easily share their progress and update the code via the internet.
Vietnam software outsourcing takes that advantages to become one of the pioneers in IT Outsourcing Industry. Let’s discover it together!
Every company wants to minimize its operating cost so as to increase their profits. This is where outsourcing comes in to play. Outsourcing gives companies access to cheaper and more diverse talent. Software outsourcing helps both the parties involved. It creates more jobs in developing countries at the same time benefiting the companies that outsource by making them huge profits.
The advantages of outsourcing will only become possible by outsourcing to the right country. Although India has been forever known as the outsourcing location, the Indian market is reaching saturation point leading companies to look at other South-East Asian countries like Vietnam. Vietnam is on the road to becoming the next India. There are many reasons why outsourcing to Vietnam is favorable.
The main advantage of outsourcing to Vietnam is its young population. Around 70% of the population in Vietnam is under the age of 35 and around 45% are between the ages of 15 and 35. This means around half of the population is fit for joining the workforce. So the sheer number of people looking for a good employment is pretty high. Vietnam also has a literacy rate of 97% which means that almost all of the population ready for employment is also educated.
2. Education Level:
In addition to the fact that Vietnam has a pretty high literacy rate, it also has around 280,000 college or university graduates every year. Every year, the education system sends out 280,000 students who are ready and searching for an employment. Out of these 280,000 graduates, 30,000 to 40,000 have graduated in the field of Information and Communication technology. They are prime candidates for software outsourcing companies looking for fresh talent.
3. IT Specialized Schools:
Companies looking to software development outsourcing company want graduates who are specifically trained in Information and Communication Technology. There are more than 250 colleges or universities that offer courses in the field of Information and Technology. In addition to this, there are also 187 vocational schools that offer Information and Technology related courses. The students have an opportunity to receive education in subjects that will help them in pursuing a career in software development. So if more companies outsource to Vietnam, more students will decide to take the career path becoming a software developer.
4. Hard-Working People:
Every company needs a workforce that is hardworking and eager to be with the company. Hard-working employees make the company progress faster. They can help finish projects faster. This will, in turn, allow companies to pursue more innovative projects on a tighter timeline. This also allows companies to survive in today’s competitive world. In the world we live in, it has become very important for companies to churn out new technologies faster than their competitors. A hardworking and eager workforce also boosts the overall morale of the company. It also ensures that they inspire each other and work better with each other.
5. Low Cost:
The cost of hiring a developer in Vietnam when compared to the cost of hiring one in America is significantly lesser. You can hire a Vietnamese developer for 90% of the cost of an American developer. Since the main aim of outsourcing is cost reduction and the main location for outsourcing till now has been India, the costs also should be compared to that of an Indian developer. A Vietnamese developer costs 30% less than an Indian developer. So not only does Vietnam have better literacy rate than most of the other developing countries, it also costs less to outsource to Vietnam than those countries. This is a magic combination for companies looking to outsource, better talent and lower cost.
Egypt was a prime location for outsourcing a few years back, but then the unstable political climate in the country set it back. Sri Lanka also has had many internal struggles. Vietnam does not have any instability politically. It has had a stable political climate for the past 30 years with the same party in power. It also has had a stable economic growth. Vietnam’s GDP growth rate is around 7.4%. This is pretty high for its geographic location. Around 90% of the population is Vietnamese and they also do not follow any religion. This means there are almost very little reasons for any ethnic or religious conflicts in the country. Since the region is stable politically, economically, religiously and ethnically, it is also much safer for the western counterparts to travel to Vietnam for training or any other such office related purpose.
7. Big Investors:
There are many big players in the tech industry who have already invested in Vietnam. Intel, IBM, Fujitsu, Foxcon and Canon are just a few such names. When more companies invest in outsourcing to a country, the infrastructure in the country also develops accordingly. This makes it even better for more companies to outsource to Vietnam. This is a cycle where more companies outsourcing to a country also makes it easier for more companies to outsource to the country. Since some big player like Intel and IBM have already started outsourcing to Vietnam, they have laid the groundwork and helped set up the basic infrastructure. They have also piqued the interest of the citizens for working in an IT company. Any new company that wants to outsource to Vietnam only needs to exploit this ripe situation.
All of the above are very good reasons for software companies to outsource to Vietnam. Any Vietnam software company only stands to gain from this decision.