POSTED ON May 31, 2022

What makes Vietnam emerge as the ideal IT outsourcing country


Using an IT outsourcing company for software application products is a recent trend. So what makes Vietnam one of the promising IT outsourcing country?

The outsourcing development industry has driven economic growth in many developing countries. IT outsourcing countries: China and India consider the leading outsourcing software development industry for their human resources. With technological expertise, Vietnam has emerged as an IT outsourcing destination.

Vietnam IT outsourcing has gained popularity for its cost-effectiveness and high-quality software development products in Asia. According to CIO magazine, using Vietnam IT outsourcing saves about 90% of business costs compared to other countries such as China, the United States, Ukraine, etc. Read the article to see what makes Vietnam become an ideal IT outsourcing country for many reasons.

Statistics: Vietnam IT outsourcing lay on top outsourcing countries

The demand for software outsourcing services has increased, especially since companies have difficulties keeping teams running smoothly. The software outsourcing market has risen by about 8.5% between 2021 and 2028. Today’s software outsourcing statistics depict: how the software outsourcing market is changing for 2022 and beyond.

Global software outsourcing statistics and Vietnam’s stats

Key global outsourcing statistics

  • 45% of global firms have planned to increase outsourcing services due to the pandemic. They concentrate on finding skills that companies can’t have (NTT Services).
  • Cloud-based technologies support 90% of companies embracing outsourcing market opportunities by reaching distributed professionals (Deloitte).
  • The IT outsourcing market has exceeded $1.3 trillion since firms boosted their search for digital transformation experts (Statista).
  • The reason for using the outsourcing software market of 70% of companies is cost-reduction since outsourcing helps lower the costs compared to in-house teams. (Gartner).
  • About 24% of small corporations hire offshore software development companies to increase efficiency. Besides, they also outsource software development teams to access specialist skills.
  • By 2023, the outsourcing software market will gain a value of $ 620 billion (Bloomberg).&

Software development market growth in Vietnam: Up-to-date 2023’s stats

In the past few years, Vietnam has embraced positive changes in digital transformation. With technological industry growth, Vietnam is considered an ideal IT outsourcing country. Each year educational institutions train 50,000 ITers, making IT the leading industry in Vietnam. Vietnam’s IT outsourcing is young. In 2017, Vietnam climbed five places in the Global Services Location Index (according to A.T. Kearney, an outsourcing software services consulting firm).


According to the Ministry of Information and Communications 2019 and 2020 reports, IT industry revenue in 2019 would gain $112,350 billion, including 81.5% for IT outsourcing. Additionally, the software development industry reached $5 billion, increasing $500 million compared to 2018. The Minister of Information and Communications Nguyen Manh Hung stated that 2020 would be the year of digital transformation.

Vietnam IT services offer e-commerce, fintech, car, and food order, software outsourcing, transportation, Business Process Outsourcing (BPO), high-tech (AI/ML, IoT, Blockchain), and business service (SAAS).

Here are some figures for various IT services in Vietnam, according to OutsourceAsia:

  • $2 billion in total revenue in business process outsourcing (BPO).
  • $7.8 billion from fintech.&
  • $103 billion in revenue from the IT industry.

A.T. Kearney identifies the top 50 countries providing IT, BPO, and software services (Global Services Location Index 2019). The report presents that Vietnam is the sixth compared to the 2017-report at eleven positions. Interestingly, the index shifts considerably toward digital resonance: financial attractiveness, people and skills, business environment, etc.


Regarding 2021, the GSLI report continues tracking the global IT industry landscape across 60 countries across big categories: financial attractiveness, people skills and availability, business environment, and digital resonance. In general, Asian economies continue occupying seven places in the top 10. India, China, Malaysia, and Indonesia will place the first four spots in global services in 2021. Vietnam, the Philippines, and Thailand hold their places in the top 10 with a change in rank. In particular, Vietnam is the sixth most attractive destination for IT outsourcing services, 2.77 and 1.2 on financial attractiveness and staff availability.
These latest reports from well-known organizations will change the way others think about the Vietnam IT outsourcing service market. Is it worth investing in Vietnam as one of the ideal IT outsourcing countries? Let’s see how Vietnam’s IT outsourcing market outweighs other outsourcing software markets.

How do we see Vietnam as the ideal IT outsourcing country: Any advantages?

Among top outsourcing countries, Vietnam tends to be the rising start by owning several advantages regarding Demographics, Human Resources, Technology, and Cost effectiveness.

Demographics in IT outsourcing country

Vietnam’s population is over 97 million people, the 15th among the top 20th largest population. With an average age of 32 years old, Vietnam is a young country. It means that a large number of people are participating in the workforce. Each of them is well-educated, especially in technology. Many developers start coding early, particularly about 8.8% of them who code before 20. Software engineers in Vietnam make up about 53.2% ranging from 20 to 29 years old. Thus, IT human resources in an offshore software development company is young, talented, and skillful.

IT human resources for ideal IT outsourcing country

Vietnam is an ideal IT outsourcing country for those looking for innovative technology and using a Vietnam software outsourcing company. Hence, investing in human resources is essential, especially for software developers. Vietnam has invested more in providing educational foundations in STEM: science, technology, engineering, and math skills.

Additionally, offshore software development companies cooperate with education organizations to develop training programs. Renowned universities invest more in education to boost quantity and quality in the Vietnam software market.

Latest technology solutions

Vietnam has become a tech pool for those concerned with technology such as the Internet of Things (IoT), Artificial Intelligence, Blockchain, etc. It is a chance for software engineers to upgrade their technological skills. It also challenges them to study and work hard to catch up with the latest technologies.

Promising destinations for investors

Tech firms such as IBM, Sony, and Apple have selected Vietnam as a promising destination for the software development sector. For example, they moved the Nokia manufacturing factory to Vietnam from China. Moreover, Japanese firms have chosen Vietnam to invest in the software development industry for various benefits, especially IT outsourcing (ITO) and Business Process Outsourcing (BPO). Therefore, international investments provide Vietnam with the opportunity to develop in technology and enhance its professional services.


In Vietnam, labor costs 90% less than compared in the United States, which means business owners can save costs for operations. According to MarketsInsider, Vietnam is one of the best IT outsourcing countries in the world (2023).

Vietnam IT outsourcing market: Challenges and Opportunities

Vietnam has become a hub of the IT outsourcing market. So it is an ideal destination for multinational companies managing big data in the software development process. Some sectors leverage Vietnam IT outsourcing: technology, financial services, gaming, etc. Here are some challenges and opportunities for the Vietnam IT outsourcing market.

IT industry in Vietnam faces IT outsourcing challenges

Different time-zone

Software development success requires effective communication protocols despite time and distance. With a different time zone, offshore development teams need to use communication tools, which help enhance productivity amongst team members. For instance, if an American company wants to hire an offshore software development company in Vietnam, it may be a challenge owing to the different time zone. Nevertheless, this would not be a task if offshore development teams managed time effectively. You can discuss software projects in the afternoon. You will receive feedback the next day.

Language barrier in IT outsourcing country

Vietnam is an IT outsourcing destination that needs to consider English since it is not too low while it is not too high. Software engineers in Vietnam have strong skills in reading and writing. They have a little difficulty in speaking and sometimes listening. However, we believe that investment in education improves their English proficiency.

  • English is a compulsory subject for Vietnamese students.
  • Schools require English tests for graduate students.
  • Bilingual programs are available for students in universities, schools, and training centers. Training technological skills and other fields in English seems to be a trend for most universities in Vietnam.

With the investment in education, English would not be a challenging issue for those who hire an offshore software development company in Vietnam.

IT outsourcing opportunities turn Vietnam into an ideal IT outsourcing country

The IT industry is rapidly growing, especially in the IT outsourcing market. The large IT markets: the United States and Japan use software development partners for outsourcing. A report shows that the figure for dedicated developers would be over one million people while the suppliers in India and Ireland only provided a maximum of 70%. So IT human resources can only afford the domestic market. So hiring outsourcing business services has moved to other markets such as India, the Philippines, Vietnam, etc.

Besides, labor costs in India and Ireland dedicated developers are increasing while the labor cost for Vietnam developers is pretty low. Hence, IT outsourcing opportunities make Vietnam an ideal market.

Additionally, unstable politics and society in many countries are other reasons for choosing an IT outsourcing firm. Multinational corporations in the United States and others stretch down the software development project to other countries with better social stability and politics. Vietnam is one of the IT outsourcing destinations with a highly stable society and political security. Therefore, a trend of relocating IT outsourcing companies to Vietnam from India and China is emerging.

Vietnam is a significant contributor to Intel’s ability to meet its outsourcing needs. Nortel Networks, Bayer, Sony, Cisco, and Anheuser Bush are among the companies that have decided to outsource operations to Vietnam. Vietnam is a promising IT outsourcing country, with many years of development ahead and a vast amount of potential to explore.

Wrapping Up 

With its talented developers and stable business environment, Vietnam will be an ideal IT outsourcing country after the big players: China and India. Hiring an offshore software development company in Vietnam will help the company lower business costs and ensure high-quality software products. As one of the leading outsourcing companies in Vietnam, Adamo Software promises to provide lucrative software solutions and excellent customer service.

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