Vietnamese IT firms marching towards the US

  • January 26, 2015

Vietnamese software firms have signed many contracts worth millions of dollars with US partners.

Vietnam, FPT, software, export turnover
FPT opens office in the US.

Global CyberSoft is one of the information technology (IT) firms which signed many software outsourcing contracts with US partners in 2014. In 2013, the firm earned $11.6 million in revenue, 44 percent of which was from the US.

FPT Software estimates a 48 percent increase in revenue from the US market in 2014, and hopes to obtain a 50 percent growth rate in 2015.

The US is the fastest-growing market among the 17 markets FPT has been present in, with the revenue in 2013 increasing by 62 percent over 2012.

To date, Japan has always been the largest market for FPT, but the IT giant hopes the US market would be expanded to become as large as Japan in the next three to five years.

Other software firms like TMA Solutions, LogiGear and KMS Technology have also reportedly reaped good fruit after many years of “cultivation” in the market.

Beginning in 2010, KMS Technology has been recruiting new workers to satisfy the increasingly high number of orders from the US. The firm, which had only 60 workers in the first year of operation, now has 500 engineers.

Analysts noted that the US is a market for Vietnamese big firms to eye. A report of Market Research Media showed that the market value may reach $518 billion by 2018 and the CAGR (compound annual growth rate) at 3 percent.

Business intelligence, cloud computing and smart grids are forecast to obtain two-digit growth rates.

The director of a software firm noted that there are always big opportunities to obtain software outsourcing contracts from the US, because US companies try to outsource to others to save operation costs.

He went on to say that about 200 companies in the Fortune American 1000 list have shown major interest in Vietnamese companies and chosen Vietnamese companies as partners.

However, he said, many difficulties are still ahead in the Vietnamese companies’ path to conquer the US market.

The big problem now is that Vietnam is not a strong brand in the US market. “India and China are better known there,” he said.

The director of a private IT firm agreed that Indian and Chinese brands are more competitive than Vietnamese, while their companies are larger and more experienced.

However, he believes that Vietnam still can find US partners among medium-sized companies which have revenue of tens of billions of dollars a year. The companies tend to look for new partners to sign outsourcing contracts to minimize costs.

Source: VietNamNet

Related Articles