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한국어 Household business operators in Vietnam are moving away from informal wholesale channels toward formal channels and verified sourcing.
18Mar2026
Latest News & Report / Vietnam Briefing
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Abstract
Vietnam’s informal economy has long shaped how small businesses source their goods. For decades, household business operators have relied on traditional wholesale markets, places like Đồng Xuân in Hanoi and Bình Tây in Ho Chi Minh City, to procure inventory quickly, cheaply, and without paperwork. However, this model is changing fast. A convergence of regulatory pressure, digital infrastructure, and shifting business incentives is driving a structural transition in how Vietnamese small and micro-businesses purchase goods. Increasingly, Household business operators are moving away from informal wholesale channels toward formal-channel sourcing: licensed distributors, B2B e-commerce platforms, and verified suppliers who can issue VAT invoices.
Understanding the Starting Point: The Dominance of Informal Sourcing
Vietnam’s retail sector is characterized by a high density of household business – small, often family-run businesses that operate under a simplified tax registration rather than as formal enterprises. According to the National Statistics Office, as of the end of July 2025, Vietnam had approximately 6 million household businesses, of which more than 1.9 million were registered. In the first seven months of 2025 alone, nearly 536,200 new household businesses were established, representing an increase of almost 165% compared to the same period in 2024[1].
These businesses have historically procured goods through wholesale markets, informal traders, and direct manufacturer contacts – channels defined by cash transactions, oral agreements, and an almost total absence of documentation. The advantages of this approach were clear: lower prices (partly due to tax avoidance), faster transactions, flexible credit arrangements, and proximity. Wholesale market vendors understood the needs of small buyers. There was no minimum order requirement, no formal registration, and no invoice necessary.
However, the limitations of informal sourcing have become increasingly evident. Without VAT invoices, household businesses cannot claim input tax deductions, raising their effective costs. The lack of formal procurement records also restricts access to bank financing, while undocumented supply chains increase exposure to quality and regulatory risks. As Vietnam’s regulatory environment matures and digitizes, these constraints are becoming more significant.
Shifting Buyer Sourcing Behavior
Recently, due to tighter regulations and greater awareness, more firms are moving to official channels (authorized dealers, B2B e-commerce, and approved importers) that issue VAT invoices. For example, a 2025 Sapo Technologies survey of 15,000 retail and F&B sellers found that compliance with tax regulations and electronic invoicing are becoming essential. 57.3% of retailers said they had basic knowledge of tax/invoice rules, while 42.7% struggled and cited difficulty issuing e-invoices, signaling a learning curve. Importantly, demand for e-invoicing is broad: nearly half of respondents issue > 10,000 invoices/year (large buyers) and another 45% issue 1,000 – 10,000/year[2]. This trend toward standardization implies that many businesses are scaling up operations and seeking official invoicing. For Vietnamese sellers, growth is no longer the sole objective, but is increasingly accompanied by the need for structured operations, tax compliance, and risk control.
Small traders are being guided on sales management, invoicing, and tax filing
Source: Bao Tuoi Tre
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