After running your retail business for quite some time, you cannot help but considering expanding your business presence through ecommerce in Vietnam. You want to start selling your products online. Indeed, now is a good time to start an ecommerce business.
This article discusses the reasons to start an ecommerce business in 2020 and how you can start selling your products online.
Why Start an Ecommerce Business in Vietnam in 2020
When it comes to giving your business an online presence in Vietnam, there are numerous reasons behind it, such as:
- Vietnam is ranked by google as the second fastest growing e-commerce market in Southeast Asia. There are around 60 million internet users and many of them are under 30 years old.
- Vietnam has more than 25 million smartphone users and its smartphone penetration is around 26.40%. This causes an increase in online and digital purchases.
- 30% of the Vietnamese will shop online (approximately 30 million online shoppers) in 2020, according to a study.
- Data from the E-commerce and Information Technology Agency of the Ministry of Industry and Trade show that the majority of SMEs in Vietnam spend more than 30% of their budget on technology.
3 Available Types for Ecommerce Business in Vietnam
It is best to know the common types of ecommerce business in Vietnam before diving further into how to start selling online.
1. Online Retailers
Online retailers in Vietnam buy the products they want to sell to customers. They can store the products until sold. Usually, online retailers are those who have their own traditional retail shops and they wish to gain more profits by starting to sell online.
2. Online Marketplaces
An online marketplace provides a website or a platform. This website or platform is used by vendors from anywhere in Vietnam to sell their products.
When a customer visits an online marketplace, they can find numerous products sold in the same place. Customers proceed with purchase and payment on the same platform.
Local renowned giants of online marketplaces in Vietnam include Tiki, Sendo, Shopee and Lazada, whereas the international players are giants such as Amazon, Alibaba and eBay.
3. Online Classifieds
Online classifieds are similar to online marketplaces. The only difference is regarding the payment. Online classifieds do not accept payments. In other words, when a customer wants to buy a product, the payment is made directly to the seller.
Foreign Investors in the E-Commerce Sector in Vietnam Need to Take Note
Before knowing what you are required to do to be able to start with the online selling, pay attention to the following:
- If you run an e-commerce company and you want your customers to make direct payments, you are required to apply for an Intermediary Payment license. If not, you are required to cooperate with institutions or entities that have secured an Intermediary Payment license such as banks, Momo and Zalo Pay.
- If you would like to sell products directly to consumers, you are required to secure a trading license that can be obtained in six weeks’ time .
Website Registration or Notification
Selling online is not possible without the existence of a website. The following documents need to be prepared for website registration, either for online marketplaces or online classifieds:
- A notarised copy of the Enterprise Registration Certificate (ERC)
- Plans to provide services
- Statute of management of the e-commerce service website
- Forms of service contract or cooperation agreement between traders and organisations that are in possession of e-commerce service websites and traders, organisations as well as individuals participating in the buying and selling on such websites
- General trading conditions
After preparing all the documents, you need to go through the following procedure:
- Prepare information on the designated e-commerce website and ensure compliance with Vietnam laws
- Have a consultation with an incorporation specialist and ask them to review your documents and website information
- Your incorporation specialist will act on your behalf and submit the application to the relevant state agencies
- If approved, you will have your registration certified issued by the Ministry of Industry and Trade
If you want to be an online retailer, you need to go through the website notification procedure. The following documents must be prepared:
- A notarised copy of the Enterprise Registration Certificate (ERC)
- Policy
After having all the documents ready, the procedure for website notification is similar to the procedure for website registration. The only difference is that for online retailers, they will receive the setup notification from the Ministry of Industry and Trade.
Consult with Cekindo
As a foreign investor, you may not be familiar with the local laws and regulations. Therefore, you may find it challenging when it comes to business incorporation in Vietnam. This is when an incorporation specialist like Cekindo comes into play.
As a leading business-entry consulting company in Vietnam, we have a team of professional consultants possessing in-depth knowledge with years of experience in the market.
For seamless incorporation, consult with us right away. Fill in the form below.