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Top 10 Logistics Companies In Vietnam

Wednesday 25, 12 2019
There are currently more than 4,000 logistics companies in Vietnam providing comprehensive service from goods transportation to making payment.
Top 10 Logistics Companies In Vietnam

The list of top 10 transportation and logistics companies is made based on scientific and objective principles. Companies are evaluated according to 3 main factors:

  1. Financial capacity shown in the latest financial statements;

  2. Media reputation;

  3. Survey of industry experts and businesses on capital size, market, labor, revenue growth rate, profit, and operation plan.

Top 10 logistics companies 2019: Warehousing and delivery

Top 10 logistics companies 2019: Cargo service

Top 5 logistics companies 2019: Passenger transport

Currently, there are more than 4,000 transportation and logistics companies in Vietnam providing diverse and comprehensive logistics services from goods transportation to making payment, of which 88% are domestic enterprises, 10% are joint-venture enterprises and 2% are foreign enterprises. Most of logistics companies are located in two major cities, Hanoi and Ho Chi Minh City.

The competitiveness of domestic logistics enterprises is still low compared to foreign-owned ones which are smaller in terms of quantity yet bigger in terms of market share (70-80%). Vietnamese logistics businesses only provide basic or individual services with little added value. They mostly play a role as a subcontractor or agent for foreign companies in warehousing services, freight transport, freight forwarding, loading and unloading, sorting services, packaging, storage, etc. Although there are some Vietnamese suppliers in other services of the logistics chain, the number is quite small and has not been developed.

Growth potential

Vietnam's transport and logistics industry has a lot of potential for growth and is becoming more deeply involved in the world transportation trading centers due to the Government's policies to facilitate the development of the industry, along with global economic integration with which many free trade agreements have been signed. Besides, the strong development of e-commerce market and automation industry, and increasingly improved infrastructure are also critical contributing factors to this industry.

In addition, Vietnam’s logistics industry has also enjoyed several opportunities created by the US-China trade war when many Chinese companies moved factories to Vietnam and Southeast Asia. Accordingly, nearly 91% of businesses in the industry believed that growth rate in 2020 will be over 10% while many experts said that the growth rate may reach 14% - 16% according to average index of recent years.

Major development trends

Application of 4.0 technologies

With the explosive development of the 4th revolution, there have been many applications of science and technology in logistics activities. Currently, developed countries are gradually implementing E-Logistics, green logistics, E-Documents ... and applying cloud computing technology, Blockchain technology, artificial intelligence or robots to provide some services including container loading or unloading, warehouse loading and unloading, etc.

Although at present, Vietnamese logistics service providers only apply not-so-advanced technology to their business activities, such as electronic customs declaration software, vehicle positioning technology, email, and Internet, according to industry experts, facing the digitalization trend, businesses in the transport and logistics industry of Vietnam will gradually adapt and accelerate application of high technology in logistics activities in order to standardize operation processes, optimize costs and resources, enhance management capabilities, evaluate service quality, and increase customer loyalty.

Cybershopping

Nearly 70% of Vietnamese population use the Internet with frequency of 28 hours / person / week, creating favorable conditions for the e-commerce industry to thrive. In 2018, according to a report of the Department of E-Commerce and Digital Economy of Vietnam, the e-commerce market reached USD 8 billion, with a growth rate of 30% compared to 2017 and is forecast to continue to grow strongly in the years to come, reaching USD 10 billion by 2020.

E-commerce has led to the development of delivery service companies with are large number of small deliveries across the nations. Many e-commerce platforms have also invested in building logistics systems, expanding warehouse sizes, and increasing number of goods distribution points to meet the needs of consumers.

M&A

In the next 2 or 3 years, there will be more M&A deals in the field of transport and logistics due to fierce competition pressure in the context of global economic integration, along with the progress of science and technology, and the impact of the 4.0 revolution.

The high growth potential of Vietnam transport and logistics industry, and the low competitiveness of domestic enterprises have created great opportunities for many foreign enterprises to participate in Vietnam's logistics market through M&A to take advantage of existing network, source of customers and domestic operating experience.

Investment in warehouses, logistics centers and cold supply chains

With the sharp increase in the number of e-commerce businesses, along with the need to rent storage space, classify goods, complete orders, many businesses have built warehouse system and logistics center with the function of providing transport services, completing orders, distributing professionally. As of early 2019, there had been 6 major logistics centers being constructed and put into operation nationwide.

Recently, the cold supply chain has experienced high growth due to the increase in the number of cold storages, growth in the processed food industry and the pharmaceutical industry. According to the market research firm Allied Market Research (2019), the size of the global cold chain logistics market was worth USD 159.9 billion in 2018 and is expected to reach about USD 590 billion by 2026. Although the cold supply market in Vietnam is considered small and fragmented, it is expanding and is expected to see new developments in 2020.

>>> Learn more:  Top 10 Food And Beverage Companies In Vietnam
 

Compiled by VietnamCredit

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