Reducing cost – Vietnamese businesses’ top priority: UOB study
Reducing cost is top priority for Vietnamese businesses as high inflation has affected 94% of businesses surveyed in 2022, according to a new study by the Singapore-based United Overseas Bank (UOB).
Ho Chi Minh City (VNA) – Reducing cost is top priority for Vietnamese businesses as high inflation has affected 94% of businesses surveyed in 2022, accordingto a new study by th♎e Singapore-based𒉰 United Overseas Bank (UOB).
Between December 2022 to January 2023, the bank’s Business Outlook Study 2023(SME & Large Enterprises) surveyed more than 4,000 businesses in Asiaincluding 505 in Vietnam, mostly located in Ho Chi MinhCity and Hanoi. The survey found that while remaining positive on 2023 outlook, top priorities for surveyed Vietnamese companies are reducing cost, tapping new customer base,diversifying supply chains, re-skilling/up-skilling existing talent anddeveloping source of revenue. It showed that 57% of the surveyed businesses have seen anincrease in cost of materials and 56% of the businesses have seen an increasein cost of operations. To mitigate inflation, over one in every two businessesin Vietnam focus on improving productivity and 45% of businesses surveyed saidthat they apply cost cutting on company activities.
The study found that amajority of businesses in Vietnam have seen an impact to their supply chains.More than a half of the respondents said that their supply chain has been impacted bygeo-political issues and find rising supply cost as the main challenge inmanaging their supply chain.
Top support measures for supply chain management include tax incentives orrebates, easier access to funding or grant, and opportunities to collaboratewith industry, government-linked or large businesses, the stud🔜y suggested.
Particularly, digitalisation can play a key role in helpingbusiness improve productivity to mitigate the impact of inflation on theirbusiness. The study finds that nearly nine in every ten businesses inVietnam have adopted digitalisation in at least one department. As many as 86%of businesses plan to spend more on digitalisation in 2023. Digitalisationcreates better impact for companies by improving productivity to mitigate theimpact of inflation on their business, helping them become more customercentric by enabling their customer outreach efforts and improving customerexperience. Accordingto UOB, about nine in every ten businesses in Vietnam are looking to expandoverseas in the next three years. The interest in overseas expansion is leadingto higher interest in cross-border digital trade platforms. Over six in tenbusinesses are ‘Very interested’ in using such platforms. Morethan a half of the surveyed business said that they are motivated to expandoverseas to grow their revenue, improve profitability and build reputation asan international business. Asmany as 72% of businesses in Vietnam eyes Southeast Asia for their futureexpansion plans and Thailand, Singapore and Malaysia are preferred./.
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Illustrative photo (Photo: VNA) 
