As the country’s economy expands under integration with the World Trade Organisation (WTO) regime, there is a pressing need to grow the size and quality of the supply chainworkforce, say industry insiders.

In 2000 there were only a handful of Vietnamese enterprises involved in logistics, but that number has now swelled, with hundreds of national companies and joint ventures with overseas companies now active in the freight forwarding and logistics markets.

A number of key stimuli were behind this, including the development of the air freight industry in recent years; the official recognition of logistics under Commercial Law in 2007; improvements in Vietnam’s warehousing facilities and fast tracking of goods through Customs thanks to new and simplified procedures.

According to a report by the Viet Nam Association of Freight Forwarders (VIFFAS), Ho Chi Minh City has 600 to 700 logistics enterprises out of a total of 800 to 900 in the nation.

The director of human resources training and development for the association, Do Xuan Quang, said the downside to the “hot” development of the industry was the small size of theaverage Vietnamese company.

“Most companies can only carry out parts of logistics operations,” he said according to a Vietnam Business Finance News report, adding that “the technology being used is at a low level compared to that in other regional countries.”

But more importantly, the logistics boom has led to a shortage of qualified workers – who must have a solid knowledge of foreign trade, international payments, customs law – and a corresponding shortage of training institutions.

According to the association, its 100 member companies have about 5,000 full-time and 4,000 to 5,000 part-time employees who have received varied training. Quang estimated that there were another 10,000 employees working in non-member logistics companies.

Tertiary graduates mainly come from universities specialising in economics and foreign-trade. Others have marine, transport or foreign language university backgrounds.

On the job training
Generally, the quality of employees in logistics enterprises is low with their only training on the job and across the whole industry there is only one individual holding a Ph.D in Logistics.

Nguyen Xuan Diep, director of Business Logistics from Bee Logistics said the scarcity of both quality and quantity is unhealthy for the industry and promotes poaching of employees, even when not fully qualified.

“As recruiters push salaries up, employees are prone to frequent job hopping, which is too bad for companies that pay attention to training,” Diep said.

As the country’s economy continues to develop, more and more Vietnamese logistics companies are coming into operation, along with international companies eager for a slice of the Vietnam market.

In accordance with Vietnam’s WTO commitments, restrictions on the percentage of foreign capital contribution, as well as other restrictive conditions will be gradually removed. By 2012- 2014, capital contributions can be wholly invested from foreign sources which will likely result in a surge of foreign logistics firms.

The Association of Freight Forwarders’ Do Xuan Quang said an increasing number of industrial zones involving foreign investors planned to set up builtin logistics centres. He predicted the number of logistics employees would at least double in the near future.

Need more logistics schooling
At present, there is a need for universities to open up new faculties majoring in logistics to meet theincreasing demand.

Professor Doan Thi Hong Van, deputy dean of the faculty of Tourism, Commerce and Marketing at the HCM University of Economics said logistics had impacts on many other sectors and was an effective tool to enhance competitiveness and integration into the international community.

In the next few years, General Logistics will be an optional subject in credit-based programmes at the FTCM faculty. And Logistics Management is also offered in a Master in Commerce programme.

“Although we haven’t received directions from the organisational board yet, several zealous professors have been preparing material, compiling text books and reference books about logistics and supply chains in advance. As soon as we get permission from the Ministry of Education and Training, we will open the programme”, Van said in the Vietnam Business Finance report.

Last year, the Faculty of Transport Economics at HCM City University of Transport was the first institution to offer a four-year undergraduate programme specialising in Logistics Management and Multi-Modal Transport (LMMMT).

Students trained as logistics management experts are expected to be good at foreign languages and possess good professional knowledge.

Quang suggested there should be a close co-operation between logistics enterprises and universities. Enterprises, for example, could host interns, provide funds to build school infrastructure or send guest speakers regularly toseminars for students.