Kirin Talk 01 | Is Vietnam benefiting from China’s slowing exports?

Kirin Talk is an initiative of Kirin Capital towards the goal of “Know Vietnam, Long Vietnam”. The series export first-hand information on all aspects of the Vietnamese market through in-depth interviews with various local entrepreneurs, assisting investors at home and abroad in better understanding the potential opportunities of Vietnam. At the same time, promote the docking of domestic and foreign resources, and join hands with “Know Vietnam, Long Vietnam”.


According to customs data, China’s total import and export volume fell by 8.3% from January to February 2023, of which exports fell by 6.8%. It is rumored that the containers in Shanghai Port were piled up, and the empty boxes in Shenzhen Port reached the highest value in nearly 30 years.

On the other hand, the news that “Vietnam exports surpass Shenzhen” was speculated from last year to this year. In addition, at the end of March, the “largest American enterprise investigation team in history” composed of Boeing, Apple, SpaceX, Netflix, Amazon, Coca-Cola, and other giants visited Vietnam, which made many people in China think that the downside of China’s exports lies in Vietnam’s rush. After China’s export share – China is miserable, and Vietnam is thriving.

But we don’t think this is the case.

Not long ago, we visited Huachang Logistics (Vietnam), a Chinese-funded shipping company in Ho Chi Minh City, and had an in-depth exchange with its CEO Kevin. Huachang was born in 2012. It is headquartered in Hong Kong and has branches in Shenzhen and Vietnam. Its services include supply chain management, international freight forwarding, e-commerce logistics, cross-border land transportation, engineering logistics, warehousing, logistics, etc. Among them, it is mainly the shipping business, especially the shipment of Vietnamese goods overseas.

During the investigation, we exchanged with CEO Kevin about the distribution of Vietnam’s industrial belts, the current situation of Vietnam’s exports, the barriers of freight forwarding companies, and the transfer of industrial chains in Southeast Asia. The following is highlighted contents of this survey:

01) Northern – Photovoltaic, 3C

Southern – Clothing, Furniture, and Fresh Food

Kirin Capital: Your company’s main business is to ship Vietnamese goods overseas. What industry are the main customers at present?

Huachang Logistics: The industry composition of our customers is actually closely related to the distribution of the industrial belt in Vietnam.

For example, in the north, customers are mostly 3C and photovoltaic enterprises, because the factories in these industries are in Beining, Beijiang, and Haiphong areas in the north; in the south, customers are mainly shoes, clothing, textiles, home furniture, fresh fruits, and food processing. Pingyang’s home furnishings, handicrafts, primarily processed foods such as rice noodles and rice noodles, as well as cashew nuts in Pingfu Province, are very famous.

Of course, the type of logistics is also related to the category of goods.

For example, 3C products are not large in size, have high added value, and have relatively high requirements for timeliness, so customers are often willing to choose more expensive but faster land transportation, directly to and from the Pearl River Delta 3C supply chain. From the perspective of price and timeliness, at present, from the Pearl River Delta to Hanoi, the goods of a container are transported by land for about 36 hours, about 17,000 yuan, and the sea is cleared for 4-5 days, 3,000 yuan; from the Pearl River Delta to Ho Chi Minh, the land transportation is about 5 days, 30,000 yuan, 3 days by the sea, 3,000 yuan.

Therefore, there is more land transportation in the north, and basically sea transportation in the south.

Kirin Capital: Which countries are these products generally exported to?

Huachang Logistics: The vast majority of household furniture is exported to the United States (90%), about half of the textile and clothing is exported to Japan (40-50%), and the vast majority of fresh fruit is also exported to China (80%).

02) Vietnam’s export also face many challenges

Kirin Capital: Since the beginning of this year, China’s foreign trade situation has not been very optimistic. Some people think that Vietnam is benefiting from that. What do you think?

Huachang Logistics: It’s hard to say anything else, but our business is facing many challenges this year. The gross profit is less than double digits, which shows that Vietnam’s export is also difficult. As far as I know, only in the furniture and home furnishing industry, did 70% of Vietnamese factories stop production last year.

Kirin Capital: What do you think of the export situation of Vietnam in the future 3-5?

Huachang Logistics: This mainly depends on the needs of Europe and the United States, and I don’t think the global economy will be very good in the next three years, and the Vietnamese economy may also be greatly affected. However, Vietnam is still going up in general, and it will definitely be better in the medium and long term.

When it comes to our industry (sea transportation), I feel that the good days of the past three years are the same as those in 2006-08, but then the shipping industry has been sluggish for more than ten years.

Kirin Capital: What do you think are the core barriers to the shipping and freight forwarding industry?

Huachang Logistics: Personally, I think the first thing is to look at the service and communication, and we can talk about the transaction. Secondly, it may be to package the whole package of shipping, logistics, warehousing, customs declaration, and trailers into a comprehensive solution. Because there are many nodes, there are more profit points than single services. For example, traditional maritime transportation attaches the most importance to shipping prices, but as a comprehensive freight forwarding company, the emphasis on shipping prices can be slightly lower, because other links also have the possibility of profits.

03) The demographic dividend goes early, and the consumption dividend comes quickly

Kirin Capital: What do you think of the transfer of the supply chain to Vietnam?

Huachang Logistics: Supply chain transfer is inevitable, but Vietnam’s volume is too small to undertake how many supply chains it is. Specifically, there have been too many factories in Vietnam in recent years, but the population is so small, and there is fewer middle and high-quality labor, so wages here have risen very fast.

For example, for office clerks in southern Pingyang Province, the salary of fresh graduates in 2019 was about 7 to 8 million VND (2000-2400 yuan), but now it has become 3500-4,500 yuan, nearly double. Some of the locals who can be supervisors in the factory have paid 7,000-8,000 yuan, which is not cheap. Some shoe and clothing companies in the south have begun to further move their factories to Indonesia.

Therefore, local wages in Vietnam will rise much faster than in China, and the so-called low-cost demographic dividend will not last long. But on the other hand, his consumption dividend will come quickly.

Kirin Capital: Do you think there are any potential opportunities in Vietnam now?

Huachang Logistics: Now when it comes to the transfer of supply chains to Vietnam, many of the transferred supply chains are to B. In fact, some supply chains to local consumers may also have opportunities.

For example, Ho Chi Minh has a “Huaqiang North” similar to Shenzhen, which sells all kinds of mobile phone accessories, but the price may be several times or even more than ten times that of Huaqiang North. Things like mobile phone cases or Apple lines are not complicated. If you can make a small workshop to produce such products in Ho Chi Minh, you should have a chance.

Kirin Capital: From your sense, what is the difference between doing business in Vietnam and China?

Huachang Logistics: For Vietnamese colleagues, it may be necessary to give more specific operational guidance, rather than generalization. For example, if you ask your colleague to check the warehouse, you can’t just say that he should go to the warehouse to take a few photos but tell him in more detail that the purpose of taking photos is to check and give timely feedback, otherwise it may lead to communication problems.

Kirin Capital: Thank you!



Kirin Capital is a research-driven equity investment company headquartered in Hanoi, Vietnam. Its core members have more than 20 years of financial experience in China and more than 10 years of financial and industrial investment experience in Vietnam. The investment covers TMT, large consumption, manufacturing, health care and financial services, and other fields, and spans all stages of equity investment such as seed investment, venture capital, private equity investment, listed company investment, and M&A investment.

Our vision is “Know Vietnam, Long Vietnam”. Through rich financial experience and local resources, we will be a guide for investors at home and abroad to invest in Vietnam and share Vietnam’s rapid growth development dividends.

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