How Vietnam Logistics and Warehousing Market is Positioned?
The Vietnam
Logistics and Warehousing Market is one of the fastest growing industries, but
poor infrastructure is increasing its costs. The main logistics hubs can be
found in the North (Ha Noi – Hai Phong area) and in the South (the wider Ho Chi
Minh City area, including Dong Nai province, Binh Duong province and Ba
Ria/Vung Tau). The market revenues were evaluated at USD ~ billion in 2011 and
were witnessed to increase to USD ~ billion in the year 2017, thus growing at
six year CAGR of ~% in the review period 2011-2017. The logistics industry
encompasses with several components such as freight, warehousing, and value
added services in Vietnam. The number of
industrial parks in Vietnam was evaluated at ~ as of June, 2014 out of which ~ parks
had been operating for just over three years.
Major global shipping companies
such as Damco, Transimex Saigon, SOTRANS, Vinafco, Vinalink, Gemadept and
others have reinforced their presence in Vietnam by offering a variety of value
added services such as outbound / inbound transportation, door-to-door
delivery, packaging, pre-shipment inspection, labeling and others. The E-commerce industry has contributed
significantly in the growth of Vietnam logistics industry owing to express
delivery services offered by the E-commerce giants to the customers in the
country. The revenues generated in the E-commerce segment were evaluated at USD
~ million in 2015, which were observed to increase to USD ~ million in the year
2017, thus growing at a massive two year CAGR of ~% in 2015-2017.
Vietnam Logistics and Warehousing Market Segmentation
By Service Mix
The freight forwarding segment among service mix has dominated Vietnam
logistics and warehousing market with a revenue share of ~%, thus evaluated at
USD ~ billion in the year 2017 owing to the country’s export oriented
manufacturing sector. Roadways were observed as the most preferred mode of
transportation, thus displaying a volume share of ~% in Vietnam freight
forwarding market in 2016. The remaining volume share of ~% was captured by
inland waterways, maritime shipping, railways and aviation transport
collectively. The warehousing segment and value added services followed freight
forwarding market with a revenue share of ~% and ~% in Vietnam logistics and
warehousing market in 2017.
By End User
The food and beverages segment
dominated Vietnam logistics and warehousing market with a revenue share of ~%,
thus evaluated at USD ~ billion in the year 2017. The sector is primarily
driven by rising demand for both foreign as well as local brands in the
country. Other sectors such as engineering equipments, metals, automotive, oil
and gas, garments, plastic products, cosmetic, rubber products, arts and
handicrafts, ceramics, glasses, pharmaceutical products and medical equipments
collectively captured the remaining revenue share of ~% in Vietnam logistics
and warehousing market in the year 2017.
By Regions
The Red River Delta and greater Da Nang regions are the primary source of
economic activities in Vietnam where the country’s most transportation /
logistics takes place. Collectively, they capture Vietnam logistics and
warehousing market with revenue share of ~%, thus evaluated at USD ~ billion in
the year 2017. Other regions in Vietnam such as Hanoi, Hai Phong, Thai Nguyen,
Da Nang, Quang Ninh, Thanh Hoa and Quang Binh were witnessed to collectively
capture the remaining revenue share of ~% in Vietnam logistics and warehousing
market in the year 2017.
How Freight
Forwarding Market of Vietnam is Positioned?
Roadways were observed as the
most preferred mode of transportation, thus displaying a volume share of ~% in
Vietnam freight forwarding market in 2016. The remaining volume share of ~% was
captured by inland waterways, maritime shipping, railways and aviation
transport collectively. From bulk cargo to a single package; perishable goods
to fragile freight, heavy outsized cargo and dangerous goods, all types of
freight are transported. The percentage of customers opting for express
delivery has increased in the past five years, thus evaluated with a revenue
share of ~% in Vietnam freight forwarding market in the year 2017.
By freight movement, the sea
freight segment dominated Vietnam freight forwarding market by capturing
revenue share of ~% in the year 2017 majorly due to increasing trade activities
amongst the Southeast Asian countries. The remaining ~% revenue share was
collectively captured by road, rail and air segments in 2017.
How is Express Delivery market performing in Vietnam logistics Industry?
The express logistics market in
Vietnam was evaluated at USD ~ million in 2011 which witnessed an increase to
USD ~ million in the year 2017, thus growing at a six year CAGR of ~% in the
review period 2011-2017. Vietnamese express delivery firms such as Hop Nhat,
ViettelPost and VNPost still have been operating well in the market alongside
foreign giants such as DHL, FedEx and UPS. These foreign giants firms mostly
deliver documents, mails, cargos in small quantities.
By international and domestic
express, the domestic express segment dominated Vietnam express logistics
market with a massive revenue share of ~% in the year 2017. Domestic express
delivery companies operating in Vietnam were witnessed to start investing in
modern technology in order to meet the increasing demand in the delivery of
goods through E-commerce. In domestic express, Viettel post established itself
as market leader within Vietnam, followed by GHN, VNPost and DHL Express. On
the other hand the international express was dominated by DHL Express, followed
by global players including FedEx, TNT and UPS Express.
Air express logistics has
dominated the Vietnam express logistics market with a revenue share of ~%
during 2017 owing to major international shipments falling in this category.
Ground Express witnessed lower revenue market share accounting to ~% in 2017. Over
the forecast period, Vietnam express logistics market is expected to drive
demand for express mail services majorly from leading growth sectors such as
IT, pharmaceuticals, electronics and financial & business services in the
country. The market is estimated to generate revenues worth USD ~ million by
the year ending 2018.
How E-commerce Logistics Market is Positioned
in vietnam?
Vietnam E-commerce logistics
market generated revenues worth USD ~ million in the year 2015 owing to the
country’s increasing access to internet and smartphones coupled with the
emerging trend of online shopping. Rising number of online orders, especially
shipments for FMCG products and consumer durables among the Vietnamese
population have been driving the demand for E-commerce logistics in the
country. The total number of orders was evaluated at ~ million in the year
2015, which witnessed an increase to ~ million in 2017. The revenue generation
increased to USD ~ million in 2017, thus displaying massive growth with a two
year CAGR of ~% in the review period 2015-2017. The average price for
delivering goods in Vietnam was estimated at USD ~ in the year 2017.
By speed of delivery, the 2 day
delivery, commonly known as standard delivery segment was observed to be chosen
as the most preferred shipping choice for Vietnamese digital buyers owing to
the rise in availability for free shipping among many e-retailers in the
country. The segment dominated by capturing a market share of ~% in terms of
number of orders, thus evaluated at ~ million in the year 2017. Other delivery
modes include 1 day delivery, same day delivery and delivery beyond 2 days in
Vietnam. By area of delivery, the intercity segment within Vietnam E-commerce
logistics market established itself as market leader with a massive market
share of ~% in terms of number of orders, thus evaluated at ~ million orders in
the year 2017. The segment dominates owing to the rising vehicle load capacity.
The remaining ~% revenue share was captured Intracity segment, thus evaluated
at ~ million orders in 2017.
How 3PL Market is Positioned in vietnam?
In terms of revenues, Vietnam 3PL
market was evaluated at USD ~ billion in the year 2011, which witnessed an
increase to USD ~ billion in the year 2017, thus growing at a six year CAGR of ~%
in the review period 2011-2017. 3PL providers can offer a variety of services
to companies seeking to outsource logistics functions in Vietnam majorly
including domestic transportation, international transportation and
warehousing. International companies operating in Vietnam 3PL market has
clearly established themselves as market leader by capturing a whopping revenue
share worth ~% in the year 2017. Major international players include VN Post,
Viettel Post, GHN, GHTK, DHL Logistics, Damco, FedEx, APL, Gemadept, Vinafco
and Transimex Saigon. On the other hand, domestic 3PL players captured the
remaining revenue share of ~% in Vietnam 3PL market in the year 2017. The
freight forwarding segment within Vietnam 3PL market dominated with a massive
revenue share of ~% in the year 2017. The growth of E-commerce industry in
Vietnam is one of the major driving forces for the 3PL freight forwarding owing
to increase in demand for fast paced delivery, efficient inventory management
and individualized shipping time. The remaining revenue share of ~% was
captured by the warehousing segment in the year 2017.
Vietnam’s demographics and
proximity to other markets presented an opportunity for newly established
players to localize production and to expand distribution networks through
mergers and acquisitions. The market is estimated to generate revenues worth
USD ~ billion by the year ending 2022, thus growing at a CAGR of ~% in the
forecast period 2018-2022.
What is the Potential of
Warehousing Market in Vietnam?
In terms of revenue generation,
the warehousing market in Vietnam was evaluated at USD ~ billion in the year
2011. The market was witnessed to increase to USD ~ billion in the year 2017,
thus growing at a six year CAGR of ~% for the review period 2011-2017. Growing
manufacturing activities in Vietnam, rising domestic consumption and increasing
international trade were some of the primary growth drivers of warehousing in
Vietnam. By number of warehouses, the Southern region dominated Vietnam
warehousing market with the presence of ~% warehouses in the year 2017 owing to
proximity towards key destinations such as airports, seaports, major cities,
main highways and borders. The remaining ~% revenue share was collectively
captured by the Northern and Central Vietnam in 2017.
By end users, the retail sector
drives significant investment and value for Vietnam warehousing market by
capturing revenue share worth ~% in the year 2017. Various product segments
such as electronic devices, textile and footwear, wooden products, seafood and
others captured the remaining revenue share worth ~% in Vietnam warehousing
market in the year 2017.
By international and domestic
companies, the international segment operating in Vietnam warehousing market
dominated by capturing revenue share worth ~% whereas, domestic firm captured
the remaining revenue share worth ~% in the year 2017. By business model, the
industrial/retail freight segment dominated overall Vietnam warehousing market
with a massive revenue share of ~% in the year 2017. The rise in the industrial
sector over the years gave an opportunity to the warehousing market to increase
in numbers making a positive impact on the warehousing industry. The container
freight, cold storage, agriculture and other segments collectively captured the
remaining revenue share of ~% in Vietnam warehousing market in the year 2017.
Over the forecast period, Vietnam
warehousing market is expected to drive demand for more warehouses in near
future on account of rising production in the country. Vietnam warehousing
market is expected to generate revenues worth USD ~ billion in the year 2018
owing to rising demand for warehousing services because of lack of adequate
space in the ports and IDC and CFS.
Future Outlook and Projections in
Indonesia Daycare Market
Over the forecast period, Vietnam
logistics and warehousing market is expected to generate revenues worth USD ~
billion by 2018. The country will focus on attracting investment in logistics
infrastructure development, constructing regional and international logistics
service centers, improving the efficiency of connection between Vietnam and
other countries, thereby becoming a modern logistics hub in near future. By the
year ending 2019, Vietnam’s E-commerce association is setting goals to improve
logistics infrastructure in association with the country’s E-commerce industry.
The association plans to develop transport systems with the aim of following
E-commerce growth drivers including growing importance of last mile delivery.
Over the long term, the Ministry
of Transport and Ministry of Industry and Trade is expected to invest and give
support to improve operating and marketing efficiency, and expand sources of
goods for the Cai-Mep Thai Vai port complex, situated in Vung Tau region,
Vietnam. Various Free Trade Agreements (FTAs) signed between Vietnam and the
ASEAN Economic Community (AEC) in 2015 will lead to boost the country’s trade
relations in long term. Additionally, foreign investment is anticipated to grow
strongly in Vietnam as many logistics enterprises in ASEAN countries are keen
to invest and have a better understanding of the laws, customs and culture of
Vietnam. The market is estimated to generate revenues worth USD ~ billion, thus
growing at a CAGR of ~% over the forecast period 2018-2022.
By service mix, the freight
forwarding segment within Vietnam is expected to dominate the Vietnam logistics
and warehousing market in the near future with a revenue share of ~% by the
year ending 2022. The warehousing segment and value added services are anticipated
to follow freight forwarding with a market share of ~% and ~% in terms of
revenue by the year ending 2022.
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Ken Research
Ankur Gupta, Head Marketing & Communications
Sales@kenresearch.com
+91-9015378249
Ken Research
Ankur Gupta, Head Marketing & Communications
Sales@kenresearch.com
+91-9015378249
