Vietnam eLogistics: Dissecting Demand Drivers

1. Vietnam SMEs are still early into their online retail journey;  social commerce is their typical starting point

Published on: Oct 2019

• A significant share of SMEs started selling online very recently, with HCMC SMEs are slightly more mature in their online journey
• Most SMEs make their online foray via social commerce, however formal marketplaces are increasingly becoming their first point of call

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2. A large chunk of online retail in VN (including social commerce) still flows within Hanoi/ HCMC; COD and return rates are high

• COD and return rates are even higher for formal e-tailing, as large chunk of orders is fulfilled outside bigger cities (in lower trust environments)

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3. Social e-commerce is heavily dependent on Hanoi/HCMC, while formal e-tailing is a more country-wide phenomenon

• 65% of all online retail orders were on social commerce in 2018
• Formal e-tailers have been able to drive e-tailing demand beyond HCMC and Hanoi, driven by superior supply chain coverage and delivery speeds

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4. For online SMEs, the price still remains the overwhelming most important parameter when choosing a logistics partner

• 65% of all online retail orders were on social commerce in 2018
• Formal e-tailers have been able to drive e-tailing growth beyond HCMC and Hanoi, driven by superior supply chain coverage and delivery speeds

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5. GoJek and Grab are most popular logistics partners for intracity routes while GHTK, VN and Viettel Post are popular in intercity routes