Four Attractions of Vietnam's Offshore Development! A Guide to Avoiding Failure When Outsourcing

Let's look at the appeal of Vietnam offshore development. After reading, you'll understand this growing trend and be able to outsource with confidence. If you're considering system development, use this as a reference.

If IT resources in Japan are in short supply, consider offshore development — carrying out system development using overseas resources.

Outsourcing to an overseas development company means local wage levels apply, allowing low-cost development. "Vietnam" has attracted growing attention in recent years as such a destination.

Here, we explain the appeal of Vietnam's offshore development, plus an outsourcing approach that helps avoid failure — please use it as a reference.

1. "Vietnam" is a popular offshore development destination.

According to the Offshore Development White Paper (2021 edition), 52% of companies choose Vietnam — far ahead of second-place Philippines, showing overwhelming popularity. China, once popular per the Ministry of Internal Affairs and Communications' White Paper (FY2007 edition), has now fallen to 6th.

As these two reports show, Vietnam's offshore development has become a growing trend.

2. Four attractions of Vietnam's offshore development

Why has Vietnam's offshore development become a trend? Next, let's look at what makes it so appealing.

2.1. Plenty of excellent talent

While Japan struggles with an engineer shortage, Vietnam offshore development is chosen to secure resources.

As national policy, Vietnam pursues growth through the IT sector, producing about 50,000 engineers yearly — a large pool of excellent talent.

Under Vietnam's education policy, computer studies are required from third grade, so job-ready skills by graduation are no longer unusual.

Talent is proficient in languages popular in Japan, such as JavaScript, Python, and Swift, and many also know AI and blockchain — another reason Vietnam is chosen.

2.2. Cost reduction

Another appeal of Vietnam offshore development is lower system development costs.

This is because starting salaries for university graduates in Vietnam are low.

According to a JobStreet survey (a job site across South Asia), Vietnam's graduate starting salary is about $250/month (approximately 32,500 yen). Since Japan's graduate starting salary is about 230,000 yen, you can develop at about 1/7 the cost.

Since Japan has an engineer shortage and high labor costs, those seeking to cut costs may want to consider Vietnam offshore development.

Challenges in Vietnam offshore development

2.3. Low communication risk

Since Vietnam is pro-Japan, communication concerns can also be put to rest.

Vietnam is pro-Japan because Japanese companies have built brand recognition there, and Japanese products are seen as high quality.
Popular anime and manga culture, giving frequent exposure to Japan, is another reason.

Japanese is a required subject in Vietnamese junior high schools, and many engineers speak Japanese, so language barriers aren't a worry. This low communication risk is another appeal of Vietnam offshore development.

2.4. Good public safety, easy to be resident on-site

System development sometimes requires being resident on-site to check progress, specs, or a demo, and Vietnam's good public safety makes this easy.

Vietnam has good public safety, so violent crime and terrorism aren't a worry, and there are no religious restrictions either.

With many Japanese companies in Vietnam, finding food is easy, and the low cost of living makes staying comfortable. If you want on-site residency, Vietnam's livable environment is a real advantage.

3. How to avoid failure in Vietnam offshore development

The Offshore Development White Paper (FY2021 edition) shows more large enterprises (8% → 14%) and small businesses (40% → 56%) considering offshore development.
But some worry about failure. For those concerns, here are ways to avoid it.

3.1. Failure example: Poor system quality

A project can fail if features and usability are poor and don't deliver expected results. A system failure that prevents startup also counts as failure.

The main cause is choosing the wrong development company — one that doesn't specialize in the system type you want.

Solution: Outsource to a system development company with a proven track record

If quality worries you, check the development company's track record.

If their track record includes the system type you want, just ask them to build something similar.

For cutting-edge technology, checking their awards helps determine their technical capabilities.

3.2. Failure example: No coding standards, making maintenance impossible

Some system development companies lack coding standards.

Coding standards are often used during maintenance while a system runs. This isn't an issue if the same partner maintains it, but with a different company, lacking standards reduces maintainability.

Be careful: maintenance requested from a nearby company can end up taking far longer than expected.

Solution: Check the development company's culture

Coding standards vary by company — they're the rules engineers use when writing code.

Coding standards may be unnecessary if you're programming alone.

But without at least minimal standards that others can understand, maintenance becomes impossible. How thorough they are depends on the company's culture, so be sure to check it.

4. For Vietnam offshore development, choose "Miichisoft"

If you're interested in Vietnam offshore development, please consult "Miichisoft". Here, we'll briefly describe the features of Miichisoft, an offshore development service provider.

Extensive system development track record
Miichisoft's strength lies in its extensive track record of system development for the Japanese market. We have developed systems such as the following.

• A risk management tool for hiring foreign workers
• A stress-check program tool
• A matching service connecting manga artists with assistants

With more than 100 projects delivered, we can flexibly accommodate our customers' requests.

4.1. Advanced technical capabilities recognized with the Sao Khue Award

Miichisoft has won the Sao Khue Award for two consecutive years as a system development company contributing to Vietnam's economic growth. The Vietnam Software and IT Services Association has recognized us as a system development company with advanced technical capabilities. There are more than 50,000 system development companies in Vietnam, and being recognized as a company contributing to economic growth among them means you can outsource offshore development to us with confidence.

4.2. Solving the problems of system development in Japan

Miichisoft was founded with the desire to "help people through system development." Our founder is an engineer who studied and worked in Japan. Miichisoft exists to solve the various problems of system development in Japan, such as rising labor costs and talent shortages.
We have bridge engineers proficient in Japanese on staff, so you can place your order without worrying about communication issues.

5. Summary

The reason Vietnam offshore development is attracting attention is that, as a matter of national policy, the country is producing excellent engineers. As a result, Vietnam offshore development has been gaining attention in recent years and has become a trend.
By outsourcing to a development company that specializes in the type of system you want, you can benefit in terms of both quality and cost. If you're struggling with a shortage of talent or rising development costs, please feel free to contact your technology partner, "MIICHISOFT".