The Analysis on Vietnamese Distribution Market and the Growth Strategies of the Korean Firms

Purpose: The purpose of this study is to analyze the Vietnamese distribution market that has chan ged from 2010 to the presen t. In particular, it aims to help companies that have entered or want to start Vietnam by deriving strategies and implications for the rapidly changing environment after COVID-19 through SWOT analysis. Research design, data, and methodology: This study used SWOT analysis. The following methods used for SWOT analysis include expert-focused interview, various statistical data, and literature studies. Well-organized SWOT analysis can be a useful tool for identifying the changing market environment and deriving a company’s entry and growth strategy. Results: The summary of the research results are as follows. The stren gths of Korean companies are excellent distribution management capabilities, advanced experiences and capabilities in e-commerce and electronic finance, strategic stability through long-term investment, and firm will of the top management. The weaknesses of Korean companies are difficulties in manpower management locally, limited global value chains, and weak brand power compared to global companies. The opportunity factors are the high possibility of development of the distribution market, increasing the clarity and transparency of the Overseas Investment Act, the familiarity of Vietnamese people due to the interest and psychological similarity of the Korean Wave and the growing size of the e-commerce market after COVID-19. Risk factors are the Vietnamese government’s regulatory policy and steep wage hikes, rapidly growing Vietnam’s local companies. and the expansion policies of global companies and Southeast Asian countries which could gradually turn into a highly competitive Red Ocean. Implications: This study derived the following strategic implications. First, a longer-term corporate entry and growth strategy is needed in the changing international trade environment. Second, it is necessary to prepare a strategy to integrate Korea’s strengths of e-commerce and offline. Finally, the government’s support is absolutely necessary for the overseas expansion of the distribution industry.