The Vietnamese market continues to be a highly attractive destination for Japanese companies expanding overseas, while maintaining a stable and high level of economic growth. However, despite the overall market growth, many Japanese companies still fail to achieve the expected profitability after entering the market.

In many cases, the fundamental reason behind missed sales targets is not an inaccurate estimation of market size itself, but rather a lack of understanding of the actual competitive landscape. This article provides a comprehensive explanation from a practical perspective of why competitive research is important in Vietnam, what should be investigated, what information sources should be used, and what level of cost should be expected.

Why Competitive Research in Vietnam Is Becoming Increasingly Important

Vietnam is a market where pricing structures and purchasing channels have become increasingly diversified within a short period of time alongside the expansion of the middle-income population. Differences in purchasing power between urban and rural areas are widening, while online purchases through e-commerce and offline purchases at physical stores coexist, meaning that the consumption structure itself continues to evolve. As a result, competitive maps that were effective several years ago are now frequently becoming disconnected from the actual market situation.

There are several common patterns behind the challenges faced by Japanese companies. One is defining competitors too narrowly by focusing only on Japanese companies in the same industry, resulting in the failure to capture the movements of local companies and third-country companies. Another is applying assumptions about pricing and sales channels based on Japanese market practices, leading to a significant gap from actual market conditions.

In addition, differences in decision-making speed often emerge when compared with local companies and emerging players. These are not issues limited to specific companies but rather structural challenges commonly observed among many companies expanding into Vietnam.

Common Pitfalls in Desktop Research

Research relying only on publicly available information has structural limitations. Financial data and business overviews mainly reveal figures that appear as final outcomes, but they do not show the intentions or processes behind how those figures were generated. Information such as strategies behind pricing decisions, actual transaction conditions with distributors, and competitive evaluations perceived by frontline sales personnel exists outside publicly available materials.

Another frequently overlooked issue is the misinterpretation caused by directly applying assumptions from the Japanese market. Although basic conditions such as distribution structures, purchasing behavior, and the roles of decision-makers differ significantly in Vietnam, interpreting market size based on experience in Japan can lead to inaccurate estimates of the market share that a company can realistically capture.

Key Research Items to Cover in Vietnam Competitive Research and Differences in Information Obtained by Respondent Type

Source: Prepared by B&Company

Overall View of the Key Research Items to Cover

The items that should be examined in competitive research cover a wide range of areas. Representative areas include company overview and capital structure, such as ownership relationships, group structure, and investment trends; product lines and pricing, including differences between list prices and actual market prices and SKU composition; sales channels, including distributor structures, margin design, and e-commerce ratios; and production and procurement structures, including factory locations, production capacity, and procurement sources. In addition, promotional activities and brand awareness, organizational and staffing structures, and future investment plans are also important areas to review.

It is not necessary to investigate all of these areas comprehensively. The starting point of research design is to clearly determine priorities based on what the company needs to decide and what business decisions the information is intended to support.

Characteristics of Vietnam’s Information Environment and Available Information Sources

In Vietnam, the scope of corporate information disclosure is not as standardized as in Japan due to the high proportion of unlisted companies and differences in the frequency and level of detail of statistical updates. This is one of the major factors that makes research more challenging.

Primary information sources include the National Corporate Registration Portal, statistics published by the General Statistics Office (GSO), customs statistics, IR materials and annual reports of listed companies, industry association materials, e-commerce platforms, and social listening on SNS platforms. However, these sources mainly provide registered figures and publicly disclosed information, and they often do not capture actual market prices, specific transaction conditions with distributors, or product evaluations from the field.

In addition, commercial flows that are difficult to record, such as transactions through traditional retail channels and live commerce, account for a significant portion of the market. This is one of the most distinctive characteristics of Vietnam’s information environment and the reason why desktop research alone has limitations in understanding the actual market situation.

Information Sources for Competitor Analysis in Vietnam

Source: B&Company

Situations Where Interview Research Influences Decision-Making

Interview research becomes particularly important during the initial stage of deciding whether to enter the market and determining target price ranges, when evaluating sales channels and potential partners, and when considering withdrawal or business restructuring. In all of these situations, publicly available information alone often provides insufficient inputs for decision-making, making them critical turning points for the business.

Differences in Information Obtained by Respondent Type

The quality of information obtained varies significantly depending on the type of interviewee. Distributors and wholesalers can provide insights into actual transaction conditions and margin structures; retail buyers can provide evaluations of competing products at the point of sale; industry experts can provide an understanding of overall industry dynamics; former employees of competitors can provide insights into internal decision-making processes; and end users can provide candid evaluations of products.

Information such as actual market prices, distributor support programs, preparation trends of new market entrants, and procurement structures is difficult to obtain without conducting primary interviews. In addition, when conducting research, it is important to consider obtaining consent in accordance with Vietnam’s Personal Data Protection Decree (PDPD) and designing questions carefully to avoid entering areas involving trade secrets.

Four Key Points for Successful Competitive Research

First, design the research by working backward from the purpose and decisions to be made. Second, cross-validate secondary and primary information by combining both sources. Third, assume outreach in the local language and ensure the quality of primary information without relying on translation. Fourth, do not treat research as a one-time exercise, but continue updating information on a regular basis. Rather than simply collecting information comprehensively, the ability to design research based on what decisions need to be made is what ultimately determines the quality of the outcome.

Four Key Points for Successful Competitive Research in Vietnam

Source: Prepared by B&Company

Estimated Research Cost and Duration

Research costs and timelines vary significantly depending on the scope of the research. A simple study centered mainly on desktop research can be conducted within a relatively short period and at low cost. However, more detailed research involving interviews across multiple locations requires additional time and cost depending on the positions of respondents, industry expertise required, and geographic coverage. Appropriately designing the research scope according to the objective is the key to balancing cost and accuracy.

Conclusion: Understanding the Actual Competitive Landscape Improves Investment Decision Accuracy

Because the Vietnamese market continues to grow, accurately understanding the actual competitive landscape is a critical factor affecting the accuracy of investment decisions. The most reliable way to reduce unexpected challenges after market entry is to appropriately combine desktop research and interview research and design the research approach according to the specific objectives.

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