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Vietnam a good option to optimize global supply chains

Released at: 14:19, 04/10/2017

Vietnam a good option to optimize global supply chains

Mr. Udo Lange (R), FTN’s Executive Vice President and COO. Photo: Khanh Chi (VET)

Mr. Udo Lange, FedEx Trade Networks' Executive Vice President and COO, tells VET about the business activities of the newly-established company and the potential in Vietnam's freight forwarding market.

by Hong Nhung

  • What is FedEx Trade Networks (FTN)? Why do you want to launch FTN in Vietnam?

As the international freight forwarding arm of the FedEx Corporation, FTN connects 95 per cent of the world’s GDP with its comprehensive suite of solutions. FTN is an international, integrated freight forwarder. We specialize in air and ocean freight forwarding, customs brokerage, and other trade facilitation services, using advanced data and technology solutions backed by a higher level of service to optimize our customers’ experience, improve their supply chain management, and help drive successful global commerce.

FTN APAC network now has 23 offices in a total of eight countries with nearly 500 members. The opening of FTN in Vietnam marks another significant milestone in our global growth strategy. These efforts are part of an ongoing global expansion initiative designed to provide customers with freight forwarding solutions wherever they do business.

This new presence in Vietnam will allow us to continue to offer customers tailored solutions designed to help reduce their costs and add value to their businesses. The Vietnamese market now has a FedEx option for freight forwarding to optimize their international supply chain. By opening in Vietnam, we are bringing the strong local market presence, intelligence, global capabilities, brand recognition, service quality, and innovation of FedEx to the country’s freight forwarding market.

  • How would you comment on the freight forwarding market in Vietnam over recent years? What is Vietnam’s position in FTN’s global business compared to other markets in the region?

Vietnam is an important market for FTN and we are proud to launch our first wholly-owned freight forwarding office in Ho Chi Minh City. Vietnam is a growing trading partner in Asia and is experiencing phenomenal economic growth. The Asian Development Bank is predicting 6.2 per cent economic growth in 2017 for Vietnam, aided in part by growing investment in the manufacturing sector. The establishment of wholly-owned operations demonstrates the significance and potential FTN recognizes in Vietnam.

After serving Vietnam via a representative office since 2009, the investment in a wholly-owned subsidiary marks a decisive step in our continued expansion, in a country with a stable economic environment, a vigorous workforce, and relatively low production costs. With our global reach and local expertise, we will be able to serve our customers in Vietnam even more efficiently and support them in simplifying the complexities of international shipping.

Freight forwarding is on the rise in Vietnam and expected to grow to $1.4 billion by 2019. This projected growth provides tremendous opportunities for FTN and our customers seeking to conduct business in Vietnam. Ho Chi Minh City, one of the gateways for Vietnam’s imports and exports, is the ideal location for our Vietnam operations, which will deliver expertise in the ocean and air forwarding industry and a suite of customizable solutions for customers.

  • What FTN services are to be provided in Vietnam? Who are your target customers?

FTN offers a full product and service range of ocean and air freight forwarding, warehousing, and customs brokerage as well as specific solutions for industry sectors prevalent in Vietnam, including retail and high-tech. In addition, the company offers a wide range of value-added services, including My Global Trade Data, its online suite of information management tools.

Customers can utilize FTN’s services as part of a total end-to-end solution, or take advantage of individual services to meet specified needs. For example, the Vietnam office connects customers with industry-specific solutions, as illustrated by our services for one of Vietnam’s largest garment manufacturers. The solution for this customer includes integrated air freight forwarding with Garment-on-Hanger services from Vietnam to the UK, supported with value-added services, such as supply chain visibility and online reporting via My Global Trade Data.

  • M&A has become popular in recent years for foreign enterprises to effectively expand their business operations in Vietnam. Has there been any thought given to acquiring a logistics company in Vietnam? What are the challenges when investing in Vietnam?

FedEx Trade Networks is always looking for ways to better serve our customers, as evidenced by the opening of our Ho Chi Minh City office. Today we are focused on celebrating the office’s opening and the opportunities our expanded presence provides to our customers.

Vietnam is experiencing incredible growth, and with that comes the need for increased infrastructure development. While this can present potential challenges when compared to neighboring economies like Thailand and Malaysia, Vietnam recognizes the need for improvement and continues to make progress in this area. As an example, the infrastructure improvements over the last 10-15 years - including expressways and deep sea ports - have laid a good foundation for continued development.

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