Starting a Business in Vietnam as a Foreigner: Your 2025 Ultimate Guide

Introduction: Why Vietnam Attracts Global Entrepreneurs for Business Setup

In recent years, Vietnam has emerged as one of the most dynamic economies in Asia. Once known primarily as a low-cost travel destination, the country is now attracting a new wave of expat entrepreneurs drawn by its rapid development, affordable living, and increasingly business-friendly climate. For foreigners looking to make a strategic move in Asia, starting a business in Vietnam as a foreigner presents a compelling opportunity.

Vietnam in 2025 offers a rare combination: a growing consumer market, relatively low competition in many sectors, and an openness to innovation and international ideas. From Ho Chi Minh City (Saigon) to Hanoi (the vibrant capital), and increasingly in cities like Da Nang and Nha Trang, foreign-owned businesses are thriving.

This comprehensive guide is designed to help you navigate the process of starting your own business in Vietnam, covering legal procedures, cultural expectations, high-potential business ideas, and key tools for success. Whether you're considering a small business or a scalable startup, this article will provide you with the essential steps and insights for how to start a business in Vietnam as a foreigner and how to operate your business once it's up and running a business successfully.

Why Choose Vietnam in 2025 for Your Enterprise?

Vietnam is a compelling choice for many reasons, solidifying its position as a prime location for business setup for foreigners:

• Strong economic growth and political stability: Creating a secure environment for long-term investments.

• Increasing urbanization and a growing middle class: Fueling demand for diverse products and services.

• Low startup and operational costs: Making it easier for small business owners to establish themselves.

• Young, tech-savvy population: A valuable asset for innovation and digital-focused ventures.

• High demand for services: Especially in tourism, education, wellness, and digital sectors.

• Strategic regional connection: Vietnam is well-connected regionally, with numerous trade agreements that make it a strategic base for operations in Southeast Asia.

For small business owners or self-employed entrepreneurs, the country presents a profitable opportunity to create a business that meets evolving consumer needs. The country supports entrepreneurship through a growing ecosystem of small business administration services, business advice centers, and digital platforms to help entrepreneurs register a business, access business financing through a small business loan, or find their target market through market research. The small business development center or other development centers can be a great resource for small business development.

Business Ideas with High Potential for Foreigners

In 2025, several industries in Vietnam remain underexploited or are rapidly expanding, especially those where international expertise is seen as a value-add. These are ideal sectors for starting a business in Vietnam as a foreigner:

• Travel and tourism: Custom tours, heritage travel, wellness retreats, and eco-tourism initiatives, leveraging Vietnam's natural beauty like Ha Long Bay.

• Food and beverage: Western bakeries, vegetarian cafés, fusion restaurants, and specialized import food businesses.

• Digital services: Web development, digital marketing agencies, SaaS platforms, and IT consulting. This is a great area for an online business. Many startups are choosing Vietnam for their business growth.

• Health and wellness: Yoga studios, coaching services, wellness retreats, and specialized fitness centers.

• Language education and tutoring: High demand for English and other foreign language instruction.

• Niche import-export businesses: Capitalizing on specific product or service demands or unique Vietnamese goods for exporting.

These small businesses are ideal for entrepreneurs starting an online business, launching a sole proprietor operation, or incorporating a limited liability company (LLC). With proper business administration, bookkeeping, and focus on your business needs, your business startup can become a successful and sustainable venture. Whether it's a home-based business or a larger operation, the principles remain similar. Many new businesses are finding success in these areas. For those looking for flexibility, consider a side business or home based businesses.

Legal Framework: How Can Foreigners Start a Business in Vietnam?

Understanding the business structure is crucial when starting a business in Vietnam as a foreigner. There are three main legal structures for expats to establish a business entity in Vietnam:

1. 100% Foreign-Owned Company (LLC): This structure gives you full control over your business entity. It's a common type of business, particularly in tech, consulting, or export-focused ventures. You'll need to submit an Investment Registration Certificate (IRC), then a Business Registration Certificate (ERC). Total setup time is usually between 30 to 45 days.

2. Joint Venture with a Vietnamese Partner: In sectors like education, restaurants, or retail, a joint venture can simplify registering a business and permit acquisition. This approach also helps with local insight and cultural understanding, crucial for doing business in Vietnam. This could be a limited-partnership.

3. Nominee Structure (Not Recommended): This informal arrangement involves a Vietnamese citizen holding the business license on your behalf. While common in restricted sectors, it is risky and not officially recommended due to lack of legal protection for the foreign investor.

When starting a business, consult a business assistance agency, accountant, or secretary-of-state designated agent to ensure legal business compliance and to determine whether a sole proprietorship, LLC, or limited liability partnership suits your goals. This initial paperwork and choice of business structure is vital for your business start-up. If you're considering buying a business, similar legal considerations apply.

Step-by-Step Guide for Business Setup Process in Vietnam

To start your business or open a new business in Vietnam, follow these key steps for a successful business start and starting a new venture:

1. Choose your business idea, business name, and type of business. Consider registering your business name early. Avoid fictitious business names or trade-name conflicts by checking availability.

2. Write a business plan or create a business plan to structure your strategy. You can use a business plan template or look at sample business plans for inspiration. This will also be crucial for securing business financing or attracting angel investors (venture capital).

3. Apply for the appropriate business or investor visa.

4. Register for the Investment Registration Certificate (IRC). This is a crucial step to register your foreign investment.

5. Obtain the Enterprise Registration Certificate (ERC). This officially registers your business.

6. Open a Vietnamese business bank account.

7. Register your business for business taxes, including revenue service identification number or tax ID (employer identification number if applicable). Your business will be taxed according to Vietnamese law.

8. Apply for business licenses and permits, or a DBA (Doing Business As) designation if applicable. Consider trademark registration for your brand.

9. Consider hiring employees and understanding local labor laws, including workers compensation.

This guide is designed for starting a small business or a scalable startup. You'll find free business tools and business resources to support your incorporation, setting up your business location, and managing business administration. These steps are crucial for starting up a business and getting it ready-to-start. They lay the groundwork for a new business.

Visas, Taxes, and Banking in 2025 for Foreign Entrepreneurs

Visas for Starting a Business in Vietnam as a Foreigner:

The investor visa (DT1 or DT2) is suitable for long-term stays and can be valid up to five years, offering significant flexibility for expat entrepreneurs. Some nationalities can also benefit from visa exemptions for stays up to 45 days.

Taxes on Your Business in Vietnam:

Corporate income tax in Vietnam is typically 20%. Personal income tax is on a progressive scale, ranging from 5% to 35%. You'll also need to consider withholding taxes on certain payments. U.S. citizens and others with worldwide income should also consult with internal revenue or federal tax service authorities in their home countries. Understanding your business taxes (taxation) is vital for compliance.

Banking for Foreign-Owned Businesses:

Foreigners can open business accounts with reputable Vietnamese banks such as Vietcombank, Techcombank, or ACB. International services like Wise or Revolut are useful for cross-border transactions and managing your finances efficiently. Building business credit is also an important consideration.

Cultural Factors in Doing Business in Vietnam

Understanding Vietnamese business culture is essential for long-term success when starting a business in Vietnam as a foreigner. Relationships (or "quan hệ") matter significantly, and face-to-face interactions remain crucial even in a digital age. Hierarchy is respected, and subtle communication is valued over direct confrontation.

Other important points include:

• Building trust before proposing business deals.

• Using formal titles and showing respect for elders and officials.

• Being patient with administrative processes.

• Leveraging local tools like Zalo, the most used messaging app.

• Embracing coffee culture as a way to build rapport – the Cao (Vietnamese coffee) is a local institution.

Common Mistakes to Avoid When Starting a Business in Vietnam

Many foreign entrepreneurs make avoidable errors when entering the Vietnamese market. Avoid these pitfalls:

• Relying solely on Western business models without local adaptation.

• Skipping legal due diligence or trying to bypass regulations.

• Underestimating bureaucratic procedures.

• Failing to account for language and cultural barriers.

• Ignoring local platforms in digital marketing (Facebook and TikTok are dominant).

Useful Tools and Communities for Starting a Business in Vietnam

To stay efficient and connected, leverage these resources for your business starting journey:

• Zalo: Vietnam's top messaging app for communication.

• Bizspective or VietnamBriefing: Reputable sources for legal business services.

• Facebook Groups: "Digital Nomads Vietnam," "Vietnam Business Network" for community support.

• ChatGPT: Useful for content creation, brainstorming business ideas, and initial legal queries.

• Canva and Notion: For visual design and efficient business planning.

• Upwork and Fiverr: For hiring remote freelancers to support your business needs. Consider business-IT solutions for efficiency. Seek out mentors who have successfully started a business in Vietnam.

Final Thoughts: Is It Worth Starting a Business in Vietnam?

If you're looking for a country that combines economic potential with a rich cultural experience, Vietnam is an excellent choice. However, success depends on more than just having a good idea. You'll need patience, adaptability, and a strong local network.

Starting a business in Vietnam as a foreigner in 2025 can be incredibly rewarding if you approach it with the right mindset and preparation. Whether you want to start a business to build a lifestyle brand, invest in tech, or open your business as a café by the beach, Vietnam offers the freedom and flexibility to make your entrepreneurial dream a reality. With the right marketing plan, legal structure, and community support, your startup business can evolve into a profitable and successful business.

Entrepreneurship in Vietnam is booming, and more and more business owners are embracing this market to open a business that aligns with their values and ambitions. From managing payroll to business taxes and understanding your target market, each detail contributes to long-term business success.

Don't hesitate to write a business plan, register your business, and use every available resource to get up-and-running. Whether you're starting my own business for the first time, transitioning from a day-job or full time job to freelance work, or expanding, the Vietnamese market is ideal for running a small business and accessing angel investors, business advice, and SBA-style services. Consider the initial start-up costs carefully. Self employment can be a great path here, with ample opportunities for business development. It's your chance to be your own boss and build your business. Business startups are finding fertile ground in Vietnam.

Frequently Asked Questions about Starting a Business in Vietnam as a Foreigner

Is it easy to start a business in Vietnam as a foreigner?

With the right preparation and legal guidance, yes. However, expect bureaucracy and cultural adaptation when setting up a business or setting up a new business.

Do I need a Vietnamese partner to start a business in Vietnam?

No, unless you're entering a restricted industry. In many cases, full foreign ownership is allowed.

What is the minimum capital required for a business in Vietnam?

There is no official minimum for many sectors, but most businesses start with USD $3,000 to $10,000 to cover initial costs.

Can I stay long-term with a business in Vietnam?

Yes. Investor visas (DT1/DT2) allow for multi-year residence and renewal, supporting your long-term business setup plans.

Which cities are best for expat entrepreneurs in Vietnam?

Ho Chi Minh City is best for tech and F&B. Hanoi is great for culture and education. Da Nang and Nha Trang are rising for tourism, wellness, and remote business models.