Supply chain shifts create opportunities for logistics businesses

The transportation of goods in our country is still primarily done by road. Photo: T.H

Intense competition in the supply chain

According to the assessments of many experts, the global shift in the supply chain has created prospects and posed numerous challenges, compelling logistics businesses to adapt to the increasing demands of the service.

Addressing crucial issues related to the global shift in the supply chain and Vietnam's role, Vu Thi Huong Giang, representing AmCham Vietnam, emphasized that in the context of a strong global supply chain shift, Vietnam was becoming an investment destination for foreign investors. "However, Vietnam is not the sole destination for these investors. They place Vietnam alongside many other countries in the region as options. Therefore, Vietnamese logistics companies need to innovate their services to participate in this supply chain," stressed the AmCham representative.

To innovate the supply chain, Dinh Thi Quynh Van, Chairwoman of PwC (Vietnam), believed that in a dynamic business environment, innovating the supply chain was increasingly important. Businesses need to transform to adapt to development trends, including applying digital transformation to optimize processes and innovating the supply chain with the goal of sustainable business development.

Assessing logistics services in HCM City, Nguyen Cong Luan, representing the Department of Industry and Trade of HCM City, stated that logistics activities in Vietnam in general, and HCM City in particular, still faced many existing challenges. Specifically, road transport remains the primary mode of transportation, given that the road infrastructure is overloaded, deteriorated, and other transport methods are not well-developed. More than 50% of roads are in poor condition and do not ensure safety for cargo transportation.

HCM City lacks large-scale logistics centers with advanced modern technology. Currently, out of the seven logistics centers invited for investment by HCM City, only one project, the High-Tech logistics center, has been invested in, with a total expected investment of VND848 billion.

The scale of logistics service providers is limit  ed in terms of operational capacity. Currently, there are about 30,000 registered logistics service businesses nationwide. However, more than 90% are mostly small and micro-sized units, operating in a scattered and fragmented manner, mostly providing basic services, with a low level of investment in modern information technology.

Anticipating the supply chain

According to Bui Ta Hoang Vu, Director of the Department of Industry and Trade of HCM City, to achieve the goal of anticipating the supply chain, it is essential to ensure that HCM City is not only a good stopover for goods entering and leaving the region but also a center for information and data management.

In this regard, HCM City is enhancing investment in developing logistics infrastructure, increasing loading and unloading capacity, and port storage, anticipating various supply chains. It aims to establish a regional-scale logistics service center in this city. At the level of the Southeast Region, there is a focus on robust development and synchronized systems of national and international logistics associated with seaports, airports, international border gates, key economic corridors, and regional trade routes in HCM City, Binh Duong, Long Thanh, Nhon Trach (Dong Nai province), Phu My town (Ba Ria - Vung Tau), and Tay Ninh.

Additionally, HCM City will collaborate with the business community operating in the logistics sector to implement solutions that enhance competitive capabilities in logistics activities in the city. The concentration will be on solutions such as establishing a digital logistics map, centralized data warehouses, creating digital platforms for multimodal transport services to serve government agencies and businesses.

Experts suggested that compared to foreign enterprises, Vietnamese logistics companies currently hold many infrastructure facilities and assets for logistics operations, with the advantage of understanding domestic business practices and customers. However, their operations are still individual, with limit  ed financial and managerial capacities, serving specific segments, lacking continuous connectivity to provide integrated logistics services.

Therefore, to develop logistics in HCM City, there is a need to strengthen inter-sectoral cooperation, closely combining businesses, government agencies, and training institutions to create a robust logistics ecosystem that anticipates the logistics shift in the region.