Custom software development business in Vietnam
Vietnam has become a leading hub for the custom software development business, offering cost-effective, high-quality solutions. This blog explores Vietnam’s software industry growth, key benefits, business models, services and how to choose the right development partner.
1. Overview of the custom software development industry in Vietnam
According to a report by InApps Technology, Vietnam's Information and Communication Technology (ICT) sector experienced a growth rate of 8.8% in recent years, surpassing the national GDP growth rate. The country boasts 67,311 digital technology firms, including 18,162 software firms. Orient Software reports that, as of September 2023, Vietnam has approximately 530,000 software developers, highlighting its position as a significant tech hub in Southeast Asia.
Key industries driving demand for custom software development include fintech, healthcare, e-commerce, logistics, and manufacturing. The rise of digital transformation initiatives and government-backed IT development programs has further accelerated the expansion of software solutions tailored to industry-specific needs. Businesses in Vietnam are increasingly investing in AI, cloud computing, blockchain, and big data analytics to build scalable and secure software solutions.
2. Why Vietnam is an ideal destination for custom software development
2.1 Cost-effective software development
One of the main reasons businesses choose Vietnam for custom software development business is its cost efficiency. VNEXT Global indicates that the average hourly rate for software development in Vietnam ranges from $15 to $30 per hour. In contrast, Devox Software notes that in the United States, junior software engineers earn between $30 and $37 per hour, while senior developers can make up to $73 per hour, depending on their experience and location.
Additionally, the lower cost of living and operational expenses in Vietnam make it a cost-efficient option for software development outsourcing. Businesses can optimize their budgets while ensuring quality-driven, innovative solutions tailored to their specific needs.
>>> Read more: Cost of Vietnam software outsourcing: expensive or cheap?
2.2 Thriving startup and innovation ecosystem
According to JT1, Vietnam's IT industry is on the rise, with an annual growth rate of about 8% from 2022 to 2026, fostering a thriving ecosystem of startups. Cities like Ho Chi Minh City and Hanoi have become vibrant technology hubs, attracting investment from venture capital firms and multinational corporations.
Government initiatives such as Vietnam’s National Digital Transformation Program have played a crucial role in promoting digitalization and fostering an innovative business environment. These initiatives support research and development, provide tax incentives, and offer funding opportunities to technology-driven businesses, making Vietnam an attractive destination for custom software development.
2.3 Strong IT infrastructure and connectivity
Vietnam has made significant advancements in its IT infrastructure, providing businesses with a robust digital ecosystem for software development. The country boasts high-speed internet connectivity, modern technology parks, and dedicated IT zones designed to support tech companies.
Major cities such as Ho Chi Minh City and Hanoi are home to high-tech software parks like Quang Trung Software City (QTSC) and Saigon Hi-Tech Park (SHTP), offering world-class facilities for software development companies. These technological advancements provide a solid foundation for companies seeking reliable IT infrastructure.
2.4 Favorable business environment and government support
Vietnam’s government actively supports the custom software development business through tax incentives, investment-friendly policies, and free trade agreements (FTAs). The Vietnamese government offers corporate income tax reductions for IT businesses and software exporters, further encouraging international investments.
Additionally, trade agreements such as CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) and EVFTA (EU-Vietnam Free Trade Agreement) have made Vietnam a more attractive outsourcing destination, enabling businesses to engage in cross-border collaborations with fewer trade barriers.
3. Custom software development business models
Vietnamese software companies adopt multiple business models to cater to different client needs:
Dedicated Development Teams – Long-term collaboration with a dedicated team of engineers working exclusively on a client’s project.
Project-Based Development – A fixed-cost model where the software is built according to a well-defined project scope.
Staff Augmentation – Providing skilled developers who integrate with an existing team to enhance project capacity.
Offshore Development Centers (ODC) – Companies establish long-term partnerships with Vietnamese firms to create remote R&D centers.
4. Key services offered by custom software development companies in Vietnam
4.1 Custom web and mobile app development
Vietnamese software companies excel in custom web and mobile application development, catering to various industries such as e-commerce, fintech, healthcare and logistics. These companies leverage modern frameworks and programming languages such as React, Angular, Vue.js, Swift, Kotlin, and Flutter to build scalable applications.
4.2 Enterprise software solutions
Vietnamese developers build enterprise-level applications, including ERP (Enterprise Resource Planning), CRM (Customer Relationship Management), and HRM (Human Resource Management) systems. These solutions help businesses automate processes and optimize operations.
4.3 Fintech and banking software development
Vietnam is becoming a major fintech development hub, with Vietnamese firms creating custom banking, payment processing, and financial security software for global clients. These solutions include digital wallets, peer-to-peer lending platforms, blockchain-based security systems, and mobile banking applications.
4.4 AI and machine learning solutions
Vietnamese custom software development businesses are adopting AI and machine learning to create intelligent automation solutions for businesses. These technologies are widely applied in predictive analytics, business intelligence, fraud detection, and customer engagement.
4.5 Cloud computing and SaaS solutions
Cloud computing has become essential for businesses seeking scalability, flexibility, and cost-efficiency. Vietnamese software companies offer cloud-based applications, SaaS (Software as a Service) platforms, and cloud migration services to help businesses transition to AWS, Google Cloud, and Microsoft Azure infrastructures.
4.6 Offshore software development and IT outsourcing
Vietnam is a leading offshore software development destination, providing dedicated development teams, project-based outsourcing, and IT staff augmentation services. Businesses worldwide benefit from Vietnam’s skilled workforce, cost savings, and high-quality development practices.
5. How to choose a custom software development business in Vietnam
Step 1: Define business requirements
Clearly defining business goals, technical requirements, and budget constraints is the first step in choosing a custom software development company in Vietnam. Businesses must identify the core functionalities needed in the software, ensuring that the development team understands the project scope from the outset.
Step 2: Evaluate experience and expertise
Assessing a company’s portfolio, case studies, and past projects is crucial for determining its expertise. Businesses should evaluate whether the development firm has experience in their industry, ensuring they understand sector-specific challenges and compliance requirements.
Step 3: Assess technical skills and capabilities
Choosing a company with expertise in modern programming languages, frameworks, and emerging technologies is essential. Businesses should verify that developers are proficient in AI, blockchain, cloud computing, fintech and cybersecurity solutions.
Technical assessments, proof-of-concept projects, and coding evaluations can help businesses determine whether a development partner meets their technical requirements.
Step 4: Check client reviews and testimonials
Businesses should review platforms like Clutch, GoodFirms, and Google Reviews to gain insights into past client experiences. Customer testimonials, case studies, and referrals provide valuable information on a company’s reliability, communication, and project delivery standards.
A reputable software development company should have positive reviews, strong client retention rates, and a track record of successfully delivering projects on time and within budget.
Step 5: Consider scalability and post-development support
A reliable custom software development business should offer scalable solutions that adapt to future business growth. Companies must assess whether the firm provides flexible team expansion, cloud scalability, and long-term system upgrades.
Post-development support is also critical, as software requires ongoing maintenance, security updates, and performance optimization. A strong development partner will offer comprehensive support, including troubleshooting, feature enhancements, and regulatory updates.
Step 6: Review pricing models and contracts
Understanding pricing structures, service-level agreements (SLAs), and intellectual property rights is crucial before committing to a development partner. Businesses should review whether contracts include transparent cost breakdowns, milestones, and legal protections.
Ensuring IP ownership clauses, data confidentiality agreements, and security compliance safeguards businesses from future disputes and ensures a smooth collaboration with the software development provider.
6. Conclusion
Vietnam’s custom software development business is rapidly growing, making it a prime destination for companies seeking high-quality, cost-effective software solutions. With a strong IT workforce, advanced infrastructure, and government-backed incentives, Vietnam continues to be a global leader in software outsourcing.
For businesses looking for a reliable software development partner, BeetechSoft stands out as a top-tier custom software company in Vietnam. With expertise in onshore and offshore development, BeetechSoft delivers innovative, scalable, and secure software solutions tailored to various industries. Partnering with BeetechSoft ensures access to a highly skilled team capable of transforming business ideas into cutting-edge digital solutions.
