Non-profit SVIV connects SMEs in Singapore and Vietnam

A NEW non-profit business association aims to make it easier for Singapore businesses to enter Vietnam, helping them overcome challenges such as fluctuating Covid restrictions, language barriers, and finding the right partners and staff.

Sing-Viet Impact Ventures (SVIV) provides services to support small and medium-sized enterprises (SMEs) in Singapore and Vietnam.

"We (SVIV) can go into developments that are coming up in Vietnam... as a group, collectively, to increase our value proposition and also to give Singapore SMEs confidence to go into Vietnam," said Joe Tan, executive vice president of SVIV, in an interview with The Business Times.

SVIV focuses on "fourth generation" (4G) SMEs, which Tan defines as having 3 main attributes: they are agile and able to shift business models fast; they are outcome-driven; and their business is on a small to medium scale.

Launched on Jan 25, SVIV has over 20 members, 10 of whom sit in its committee. Eight committee members have businesses and networks in Vietnam, while the rest run Singapore businesses with an interest in entering Vietnam.

"We were very deliberate on who we wanted as a committee member," said Tan. "We don't have committee members that overlap in terms of work. Most of our members come in specialising in each different sector."

The January launch was timed to benefit from the opening up of Vietnam's economy, said Lim.

"Vietnam is forecasted to be the fastest growing Asean economy in 2022 and is likely to post a 28 per cent year-on-year growth this year.

"We are seeing vast opportunities for SMEs in both countries to collaborate, particularly in the areas of e-commerce, property, retail, trading, fintech, and emerging industries such as renewable energy and digitalisation," noted Lim.

SVIV works in close partnership with the Trade and Investment Office at Vietnam Embassy in Singapore, as well as the Vietnamese community in Singapore. On the Singapore front, it is in talks with Enterprise Singapore to explore potential areas for collaboration.

Services which SVIV provides for its members include business matching; identifying government funding and support; developing socially responsible business models; establishing skills upskilling and transfer programmes; and professional support services.

Ordinary membership costs S$350 per year. Each member may nominate up to 4 additional nominees, at S$150 per person, per year. Nominees are entitled to all regular membership benefits except for voting rights.

In 2021, Singapore was Vietnam's largest foreign investor, with foreign direct investments amounting to nearly US$10.7 billion - accounting for 34.4 per cent of Vietnam's total foreign capital investments that year.

Lim noted that Vietnam has been growing at more than 6 per cent per annum over the last 10 years, and is on track to become one of the top 10 countries in terms of gross domestic product size by 2050. Vietnam's growth comes from export-oriented activities, much like Singapore, he said.

"Their advantage is the young population," he added. "More than 70 per cent of the population is below 35 years old. Because of that, the potential for middle class growth is there."

As Vietnam's 97.3 million population is largely youthful, it can readily assimilate learning and technology to transform the economy and become more resilient and sustainable, he said.

Many businesses are relocating to Vietnam now because of the lower relative labour, land, and raw materials costs, as well as its good geographical location amid the US-China trade wars, Lim added.

Wayne Chen, treasurer at SVIV, runs Singapore-based human resources company (HR) Elitez, which was formed in 2010. It offers services such as HR consultancy, payroll processing, and training.

In 2018, Vietnam became the first overseas venture for Elitez, which now has some 70 staff there.

"One of the biggest challenges I faced when expanding to Vietnam was the language barrier. At that time, not many could communicate very fluently in English," Chen said.

The cost of incorporating a business was also "cumbersome", with many vendors charging figures in the "5-digit US dollars" range, and the whole process taking up to 3 months, he added.

"I'm very lucky I managed to meet a business partner whom I had a joint venture with in Vietnam. He taught and guided me to overcome these challenges," Chen noted. "Trusted relationships go a long way in building successful partnerships in Vietnam."

One key purpose of setting up SVIV is to help match Singapore companies with reliable partners in Vietnam, and avoid the hurdles that previous businesses such as his had to face, he added.