Vietnam as dynamic consumer market

In recent years, Vietnam has emerged as one of Asia's most notable economies, not only as a manufacturing hub but increasingly as a dynamic consumer market.

- Salvatore Banco

Salvatore Banco, head of the Ho Chi Minh City and South China offices at D'Andrea & Partners, explains the key drivers behind this trend.

For decades, foreign investors were drawn primarily by competitive labour costs, export-oriented industrial zones, and integration into global supply chains. Today, however, a deeper structural transformation is underway, one that is reshaping how international businesses approach market entry, growth, and long-term positioning.

At the centre of this transformation lies the rapid expansion of Vietnam’s middle class. Rising incomes, urbanisation, and demographic shifts are redefining consumption patterns and expectations. Yet the implications of these trends go beyond simple demand growth. They are fundamentally altering the psychology of investment in Vietnam.

Perhaps the most important change is not purely economic, but psychological. Vietnam is no longer seen merely as a place to produce goods at low cost; it is increasingly viewed as a market where companies expect to generate meaningful revenue. This shift is subtle but profound.

As household incomes rise and consumption becomes more sophisticated, foreign investors are rethinking the timing and structure of their market entry strategies. In the past, many companies prioritised manufacturing operations and deferred market-facing investments. Branding, distribution, and consumer engagement were often secondary considerations, sometimes postponed indefinitely.

Today, that sequencing is changing. Companies are moving earlier into the market, investing upfront in brand positioning, retail presence, and customer relationships. This reflects a growing recognition that Vietnam is not simply an export base, but a destination market in its own right.