Why ODC in Vietnam is Ideal for Business Expansion?

As global businesses seek to scale their operations and optimize costs, offshore development centers (ODCs) have become a strategic investment. In recent years, Vietnam has emerged as a top destination for ODC in Vietnam, attracting over 60% of global companies expanding their offshore presence in Southeast Asia. With a booming IT sector, a skilled workforce, and competitive operational costs, Vietnam offers a compelling case for businesses looking to establish or expand their offshore capabilities.

How an ODC in Vietnam Benefits Businesses?

Setting up an offshore development center provides businesses with numerous advantages, including cost savings, scalability, and operational efficiency. By leveraging an ODC in Vietnam, companies can access a vast pool of skilled professionals without the complexities of direct hiring. This model enhances flexibility, allowing organizations to scale their teams quickly in response to project demands. Additionally, an ODC in Vietnam fosters innovation through continuous collaboration with local experts while ensuring quality and compliance with international standards. Ultimately, businesses can achieve faster time-to-market, improved productivity, and significant cost reductions by strategically utilizing an ODC in Vietnam.

Why Vietnam? Key Factors Driving ODC Expansion

Cost-Effective Talent Pool Vietnam provides a highly skilled IT workforce at significantly lower costs than Western countries. The average salary for a software engineer in Vietnam ranges from $10,000 to $30,000 annually—substantially lower than in the U.S. or Europe. Moreover, the cost of living and operational expenses make Vietnam a financially attractive option for businesses setting up an ODC in Vietnam.

Source: Savvycom Whitepaper “Vietnam Developer Rates”

Thriving Tech Ecosystem Vietnam’s ICT sector has been growing at an annual rate of 8-10%, driven by government support, foreign investments, and a vibrant startup scene. Cities like Hanoi, Ho Chi Minh City, and Da Nang have become technology hubs, fostering innovation and providing access to cutting-edge talent for businesses looking to establish an ODC in Vietnam.

Government Support & Business-Friendly Policies: The Vietnamese government actively promotes digital transformation through incentives, tax benefits, and streamlined business registration processes. Special Economic Zones (SEZs) and tech parks further enhance the ease of setting up an ODC in Vietnam.

Strategic Location & Global Connectivity Situated in the heart of Southeast Asia, Vietnam offers excellent connectivity to global markets. Its time zone allows for convenient collaboration with both Western and Asia-Pacific clients, making it a strategic choice for global enterprises looking to establish an ODC in Vietnam.

Key Considerations for Setting Up an ODC in Vietnam

While Vietnam presents immense opportunities, businesses must navigate a few key factors for a successful ODC setup:

• Talent Acquisition & Retention: Finding and retaining skilled professionals is crucial. Vietnam’s workforce is young, tech-savvy, and eager to learn, but competition for top talent is rising.
• Legal & Compliance Factors: Understanding local labor laws, taxation policies, and data protection regulations is essential for smooth operations when establishing an ODC in Vietnam.
• Infrastructure & Technology Readiness: Ensuring reliable IT infrastructure, cybersecurity measures, and seamless integration with global teams is critical for efficiency.

Your Roadmap to Success: A Comprehensive E-Book

Expanding globally through an Offshore Development Center (ODC) in Vietnam can be a game-changer for businesses looking to scale efficiently while optimizing costs. However, setting up an ODC in Vietnam requires a strategic approach to ensure seamless integration, cost efficiency, and long-term success. Below is a structured roadmap that businesses can follow to navigate the complexities of establishing an ODC in Vietnam.

Define Your Business Objectives and Strategy

Before setting up an ODC, businesses must clearly outline their objectives. Are you looking to reduce development costs, tap into a new talent pool, or scale your operations more flexibly? Defining your goals will shape every decision, from choosing the right location to hiring the right talent.

Additionally, businesses must decide on their ODC model:

• Captive ODC – A fully owned and managed development center that provides complete control over operations.
• Managed ODC – A partnership with a local vendor who handles operations while the parent company retains strategic oversight.
• Hybrid ODC – A mix of both, where businesses outsource certain functions while maintaining control over core development.

In Vietnam, managed IDC model and build-operation-transfer (BOT) model are currently considered the most popular options.

Conduct Market Research and Feasibility Analysis

A successful ODC setup requires a deep understanding of Vietnam’s IT landscape. Key factors to research include:

• Talent Availability & Skill Specialization – Vietnam is home to over 530,000 IT professionals, with a growing number of software engineers skilled in AI, blockchain, and cloud computing.
• Salary Benchmarks – Understanding salary expectations and cost differences between hiring directly and through recruitment agencies can help optimize budgets.
• Legal & Regulatory Environment – Businesses must familiarize themselves with labor laws, tax regulations, and intellectual property protection policies to ensure compliance.\
• Cultural Fit & Work Ethic – Vietnamese developers are known for their adaptability and strong work ethic, making them an excellent fit for international teams.

Develop a Talent Acquisition & Team Setup Strategy

Recruiting the right talent is one of the most crucial steps in building an ODC in Vietnam. Businesses must determine:

• Hiring Model – Will you build an in-house recruitment team, use external agencies, or partner with a local staffing firm? Each approach has cost and efficiency trade-offs.
• Tech Stack Alignment – Ensure that the local talent pool aligns with your company’s required technologies and frameworks.
• Retention Strategies – Competitive salaries, career development opportunities, and a strong company culture can help reduce turnover rates.

Establish Infrastructure, Compliance, and Security

Once the team is in place, businesses need to focus on operational setup, which includes:

• Office Space & IT Infrastructure – Securing a workspace in a tech hub like Hanoi or Ho Chi Minh City with high-speed internet and enterprise-grade IT support.
• Data Security & Compliance – Implementing strict security protocols to protect intellectual property and comply with international standards such as GDPR.
• Payroll & Employee Benefits – Structuring compensation packages that align with Vietnamese labor laws, including mandatory social insurance contributions.

Optimize Operations and Scale Efficiently

To maximize the efficiency of an ODC in Vietnam, businesses must establish effective collaboration frameworks:

• Agile & Remote Work Practices – Using project management tools like  Jira, Trello, or Asana to streamline workflows.
• Regular Performance Reviews – Implementing KPIs and regular check-ins to ensure high productivity and quality output.
• Continuous Upskilling – Providing training programs to keep the team updated with the latest technology trends.

Your Ultimate Guide: A Comprehensive E-Book

While the roadmap provides a high-level overview, setting up an ODC in Vietnam involves many moving parts. To simplify the process, we’ve created a comprehensive e-book that offers a deep dive into every aspect of offshore development.

What’s Inside the E-Book?

✅ A detailed analysis of Vietnam’s economic and technological landscape, including government policies and emerging tech trends.

✅ Insights into hiring strategies, salary expectations, and workforce trends to help businesses attract and retain top talent.

✅ A step-by-step guide to setting up an ODC, from legal registration to operational best practices.

This must-read guide is designed for startups, SMEs, and enterprises looking to expand their global presence while optimizing costs and improving operational efficiency.

Take the First Step Towards Global Expansion

Vietnam is more than just an emerging IT hub—it is a strategic destination for businesses seeking innovation, scalability, and cost-effective solutions. Whether you’re building your first offshore team or scaling an existing ODC, this e-book will equip you with the insights and strategies needed to succeed.

📥 Download the e-book now and get ready to scale your business in Vietnam!