[Vietnam Biz – Part 24] Are you ready for global tax compliance? Key corporate income tax risks and countermeasures in Vietnam (Part 5)

5. How Company A Set Up in 6 Months and Reduced Costs by 30%

When expanding into Vietnam, the factors behind Manufacturing Company A’s ability to reduce manufacturing costs by as much as 30% and complete local incorporation in just half a year were driven by several concrete initiatives and a locally rooted support structure. Three key elements—speeding up company formation, cost optimization through supplier selection, and local hiring support—served as the driving force behind achieving such major results in a short period.

Here, we summarize the practical know-how and key points gained through Company A’s initiatives, presenting them as a case study that companies facing similar challenges can reference.

Speeding up local company incorporation

Cost reduction through proper supplier selection

Local staff recruitment support

Let’s look into each of these features in detail.

5.1. Speeding Up Local Company Incorporation

What Company A first faced when expanding into Vietnam was navigating complex administrative procedures and local legal regulations. However, by leveraging Japanese-language support from consultants with a local base, they were able to clearly understand the required document preparation and application flow, minimizing the risk of procedural delays.

In addition, preliminary surveys leveraging local networks and coordination with Vietnamese government authorities progressed smoothly, completing the company incorporation in a shorter timeframe than usual. As a result, they were able to maximize investment opportunities without missing the timing for market entry. It can be said that this kind of locally rooted support structure was the factor that enabled such a speedy entry.

5.2. Cost Reduction Through Proper Supplier Selection

In selecting local suppliers, Company A leveraged up-to-date information and proprietary networks. Consultants carefully screened five promising supplier candidates and conducted comparative evaluations.

During the negotiation stage, experts familiar with local business practices and price negotiation strategies were present, enabling them to avoid unfavorable terms and secure optimal contract conditions. As a result, manufacturing costs were reduced by 30% compared to conventional levels. Beyond simply lowering costs, stability in quality and delivery timelines was also ensured, providing peace of mind for post-expansion business operations. Whether or not such local support is present directly impacts long-term competitiveness.

5.3. Local Staff Recruitment Support

Securing talent at a Vietnamese base often poses a major hurdle for expanding companies. In Company A’s case, consultants well-versed in the local hiring market provided end-to-end support, from drafting job descriptions to managing the interview process.

Taking into account the local work culture and job seekers’ preferences, they smoothly achieved the recruitment of 20 staff members. Risks related to language barriers and mismatches were also kept to a minimum by leveraging local Japanese-language support. By building a stable team structure right from the initial phase, the business launch progressed smoothly. The presence of such local recruitment support serves as the key to smooth overseas base operations.