Fast-growing e-commerce fuels delivery service boom in Vietnam

Vietnam’s e-commerce has been growing in a robust pace in the wake of COVID-19, fuelling a boom in transport and express delivery services.

It was estimated that Vietnam’s digital economy has been developing at an annual average rate of 38% since 2015, higher than the average of 33% in Southeast Asia.

The COVID-19 pandemic has given a remarkable push for the revolution of e-commerce in Vietnam, with four leading online marketplaces reportedly expanding around 8 – 50% last year, according to a report by the Vietnam E-commerce Association (VECOM). 

There was a significant surge in the number of orders on e-commerce sites from June to September last year, when social distancing rules were strictly in place to curb the spread of COVID-19, compared to the same period of 2020. The value of each order was 8 – 10% higher than the projected figure at the beginning of the year.

Various express delivery and transport services providers have been founded to meet the increasing demand. As of the end of September 2021, the number of postal service providers in Vietnam had reached 650, up 67 from the end of the previous year, data from the Department of Posts under the Ministry of Information and Communications showed.

The growing competition in the industry has forced many firms to apply the latest technologies and introduce various innovative solutions to gain a bigger market share. One of the industry’s biggest companies – J&T Express – has launched its international shipping services J&T International to reach more customers at home and overseas.

Brand Director Phan Binh said J&T Express has expanded its international freight routes to more than 200 countries and territories. In early January, the company expanded its network to the Middle East, starting in Saudi Arabia and the UAE.

Vietnamese delivery services companies have been constantly diversifying and upgrading their services to satisfy customers’ specialised needs and provide enriched experience in an effort to heighten their position in the market.

Advanced technologies, including the Internet of Things (IoT), Digital Twins, and smart and automated warehouse, are lending a helping hand to allow these companies to handle a huge volume of orders with improved service quality every day.

Talking to the Vietnam News Agency, Anh Duc, a resident in Ho Chi Minh City, said he prefers brands which own both offline and online sale channels. For him, those having linkages with reputable transport and delivery services providers are more likely to gain trust among customers and offer them a wide range of products and better experiences.