of chasing low cost labour markets is almost over due to perceived political instability, fragmentation and brand risk associated with newly-developing countries, and that future efficiencies will be gained predominantly through technology. “This presents significant opportunities for software in the future.”
It's still early days for ShapeShifter in Vietnam. However, the company now has a growing group of qualified Vietnamese ‘operators' who know its solutions intimately.
White's advice on Vietnam is to firstly, understand and segment your market – it's about focus. “For example, we segment into locallyowned and foreign-invested firms. Foreign-invested manufacturers are then broken down into Chinese, Taiwanese, Korean, etcetera.
“Understand the role of government, private versus joint stock companies, and the difference doing business between the North, South and Central parts of the country.
“Also, understand who you're dealing with and if it doesn't smell right then it probably isn't. We came across the issue of ‘coffee money' (graft) early on and dealt with it head-on. Be prepared to walk away.
“Become an expert on labour relations if you're employing staff too. Certain aspects of the Vietnamese Labour Code are quite different than here in New Zealand.”
White firmly believes the Vietnamese economy is on the cusp of a step-change in fortunes. “Despite still having a number of structural issues there is a very young, highly talented and motivated labour force who are desperate for change and have great hopes.”
As the initial ‘rush' into China starts to tail off the likes of Vietnam will really begin to make traction, he says.
“There is also clear evidence – and good reason – that New Zealand is now putting more attention on geographical diversification of our exports. Vietnam should be at the top of the Southeast Asian list in my view.
“I can see trade between our two countries growing well over the next decade – probably much of this on exports of protein and fibre. However, I also think that there'll be greater opportunity for investment too. Vietnam may not simply be an export story.”