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  • Writer's pictureBjörn Koslowski

ITO Companies in Vietnam

Updated: Sep 8, 2021

Vietnam is on the top of relevant ITO rankings from Gartner and Kearny. While the country does not enjoy the same clout in ITO as more prolific places such as China, India or the Philippines the interest is rising. A strong local enterprise scene has formed. International investors are establishing outsourcing companies with sales offices abroad. Furthermore, MNCs are opening development centers in Vietnam. In today's blog article, we will take a look at the country's ITO scene and German ITO operations. We hope that it supports companies looking for outsourcing partners or those planning to invest into offshoring operations Vietnam.

Disclaimer: We are no experts on IT, so please forgive us any misnomers or things we forgot. If you see any any need for corrections you may let us know in the comments.

„ITO“ is an abbreviation for “Information Technology Offshoring/Outsourcing”. While the term “Information Technology” is broadly utilized, “Offshoring” and “Outsourcing” may need additional explanation. According to “Gabler”, Offshoring describes “the relocation of internal operations abroad”. For example: An enterprise establishes international subsidiaries fulfilling certain tasks for the parent company. In contrast, Outsourcing is defined by Gabler as “the transfer of value-add activities of an enterprise to external suppliers”. For example: A company chooses to use a contractor to take over some of its programming or engineering work.

For most investors into IT offshoring, a subsidiary abroad is an extension of their operations at home. However, in some cases business models are built around offshoring: In these cases, the “headquarter” in the company’s origin country/region only as an administrative and sales function while the “production” is wholly transferred abroad.

Overview of ITO forms

Advantages of ITO:

With ITO, companies may gain access to labor resources they cannot obtain at home. Furthermore, having multiple sourcing locations worldwide can make a business more resilient to external shocks. Also, having a worldwide presence may improve responsiveness to customer queries.

Disadvantages of ITO:

On the downside, ITO generally increases the complexity of a company’s operations mainly because of its cross-border nature and the need for increased coordination. For outsourcing, the protection of intellectual property may be a hurdle.

Outsourcing Companies

To find an overview of outsourcing companies in Vietnam, we analyzed the content displayed on From the 200 or so search results we reviewed, about 75 were companies providing services regarding software development in the broadest sense. While there are probably more such enterprises in Vietnam this represents a sample of highly rated outsourcing firms in Vietnam.

Overall, these 75 IT-outsourcing companies employ roughly 25,000 people. A true whale in this pond is “FPT Software” with its 13,000 employees. This probably is the biggest IT company in the country with several locations across Vietnam and internationally (e.g. FPT operates an engineering office in the city of Essen in Western Germany with 30 employees). Apart from ITO, FPT is also developing its own software platforms and services. To nurture future talent the company is running its own universities. FPT with its huge operations and favorable public image surely is a competitor for talent that every incoming ITO investor must have on her radar.

Other big ITO companies are TMA Solutions (2,400 employees), Rikkeisoft (1,200) and KMS Technology Solutions (1,000). Apart from these “giants” most of the outsourcing enterprises are small or mid-sized with an average of roughly 100 employees. The typical ITO firm might be much smaller because our sample does hardly include any startups or freelancers.

Within the sample, we were focusing on programming companies. There is a strong focus on web app and online programming with 74% of the sample advertising that they are active in this field. Furthermore, 65% are offering “software programming”, often including testing. 18% are stating that they are handling AI. In some cases, game development as well as Blockchain are also a focus. Apart from the sample there also seem to be a lot of companies active in IT security and consulting services; it however is not clear if they are targeting overseas markets as “ITO firms”.

72% of the sample are Vietnamese companies. The remainder is made up of overseas companies with diverse origins. The USA is the only country with a larger group of investors; in some cases they have been started by returning overseas Vietnamese.

Prices mostly lie between 25 and 50 USD/hour. Some firms charge up to 150 USD/hour.

German ITO Companies

There are currently 22 ITO companies from Germany in Vietnam (only three of them are in aforementioned sample). They are employing at least 3,400 people; almost 10% of all “German” staff in Vietnam.

Most of these German ITO companies are offering outsourcing services to international external clients. They mostly have all of their “production” based in Vietnam (and partly other countries) and only run sales/admin offices in Germany and other world regions. However, two companies, namely Hella and Bosch, are operating classic offshore activities in Vietnam. Here, they have engineering centers supplying their global production network with technical solutions.

The biggest ITO companies are Digi-Texx (our estimation: Roughly 500 employees in ITO) as well as MGM Technologies (300 employees). Both are being dwarfed by Bosch with its 1,700-member engineering center in HCMC. Excluding Bosch, German ITO investors are employing 110 people on average.

Most of these companies started their Vietnam activities quite recently. 12 of the 22 firms received their investment licenses after 2017.

To open a legal entity, companies must inject a certain amount of charter capital. On average, the German ITO companies have contributed 300.000 USD. The spread is however pretty wide. The lowest charter capital amount is 10,753 USD while the highest is 1.3 million USD.

Overview: Selection of German ITO providers in Vietnam


And there you have it. Vietnamese ITO is gaining in popularity. The local industry is positioned quite well with its able, willing and not-too-expensive work force, its open legal environment and its market traction. Apart from above-mentioned German companies, many other international companies have set up offshoring (r&d) operations in Vietnam such as Microsoft, IBM or Samsung. At the same time, Vietnamese local outsourcing is dominating the sample above with a share of 70% of the researched companies.

In a nutshell: ITO in Vietnam (based on research above)

Feel free letting us know if you need support with establishing an IT offshoring operation or if you need to find an outsourcing partner by sending a mail to

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