Skip links

Software development in Vietnam

Are you looking to build a software development team or outsource your software development project to Vietnam but have no idea where to start? This article is for you.

During the last decade, Vietnam has grown to become a viable outsourcing alternative to China or India.

The 2019 A.T. Kearney Global Services Location Index rated Vietnam as the 5th most attractive outsourcing location in the world.

Vietnam offers many advantages for international companies in search of software developers. Those include:

  • A large and growing talent pool
  • Exceptional value for talent
  • Great geographic location
  • High-quality educational system
  • Functional ecosystem
  • Great outsourcing destination
  • Huge continuing investment in tech talent
  • Low attrition and professional culture

The team at Railay had a closer look at each of these advantages and what they can mean for you.

Large and Growing Talent Pool

One of the most attractive things about Vietnam is the country’s large and growing software

development talent pool.

At the moment, there are 150,000+ software developers and 80,000+ digital specialists in the workforce with 40,000+ new IT graduates joining the industry every year.

Vietnam has a very young, tech-savvy population with an avid interest in computer science and a passion for software development careers. Kids get exposure to computer science and start coding lessons earlier in life than many Western peers. By the time software developers finish university they all have plenty of practical experience.

All this encourages many international companies to think of Vietnam as a long-term answer to their talent shortage issues in their home markets.

Exceptional Value for Talent

Due to the size of Vietnam’s talent pool, and the relatively low costs of living and doing business in Vietnam, the country’s software development services are priced very competitively.

That enables international companies to build more for less and not having to compromise on product features and quality of the team.

Outsourcing to Vietnam makes sense financially and quality-wise.

Great Geographic Location

Located in Southeast Asia, Vietnam is only 1-4 hours flight away from other leading economies in the Asia-Pacific region, such as Singapore, Japan, Korea or Australia.

It is on average 6 hours ahead of Western European countries. Many software houses adopt flexible working hours to better suit clients they work with so daytime synchronous communication with Europe is easy.

Although Vietnam is fairly far from the US and Canada, it remains a major IT services supplier to those countries. Time difference is rarely an issue. Flexible working hours mean there is always at least a few hours of overlap.

Many clients use time difference to their advantage as products can be developed and maintained 24/7. 

High Quality Educational System

Good educational system is needed to produce a highly skilled workforce and Vietnam

offers great quality education in Computer Science, IT, and STEM areas.

Every year, tens of thousands of junior software developers enter the Vietnamese job market. Most of the time, they hold a degree in Computer Science or a relevant subject, but also have some practical experience gained during internships.

Functional Ecosystem

Vietnam is one of the fastest-growing economies in the world. It offers social and political stability and a huge governmental support for the tech industry. Government measures include special enterprise zones, tax breaks and grants, investments in new software parks and improved ICT connectivity.

As a one-party state with firm political leadership Vietnam offers consistency and reliability that many countries lack.

Great Outsourcing Destination

AT Kearney put Vietnam in the top 5 best outsourcing locations globally.

Vietnam had the third-largest increase in the business environment score, driven by a large score increase in the country infrastructure component. Companies such as Intel, IBM, Samsung and Microsoft continue to invest in Vietnam, showing a great momentum for the industry. Japanese IT companies frequently use IT services in Vietnam and currently use ca 20,000 Vietnamese employees.

Vietnam is focused on developing highly skilled workforce and increasing the level of English proficiency.

Huge Continuing Investment in Tech Talent

Tech companies, universities, high schools, local NGOs work actively together to build a strong tech ecosystem ensuring a long-term talent pipeline. New, modern educational programs and facilities are built to ensure that Vietnam’s IT workforce remains competitive.

For example, Intel launched a $40 million program to improve tech education at Vietnam’s universities. Vietnam-German University (VGU) recently received a $180 million loan from the World Bank to build a new campus for 12,000 students.

Low Attrition and Professional Culture

Vietnamese software development companies follow the global IT industry standards, practices, and project management methodologies like Agile and Scrum. Scrum is the most common practice in IT project management, so you can be sure that Vietnamese development teams have experience in following the Agile principles.

Work culture is highly professional.  Local customs and work habits aren’t much different and won’t affect the quality of teamwork and communication during the project. 

Vietnamese are known for their loyalty to employers. Low attrition ensures dependability and integrity among tech teams, which is particularly important for companies seeking long-term development partners.

Software development in Vietnam – conclusion

Vietnam has it all to become a great outsourcing destination. Unmatched cost-advantage,

outstanding technology talent, access to high-quality tech universities, and in-depth knowledge of the global software development standards.

If you’re looking to build your team in Vietnam, reach out to us. We have partnered with and built extended software teams for companies from the United Kingdom, United States, Australia, Singapore, Japan and many more.