market entry strategy of direct selling business in vietnam

Abstract

The primary purpose of this research is to explore factors influencing the decision of foreign market entry strategies of international direct selling companies in Vietnam. The methodology is qualitative method, analyzing data collected from both secondary and primary sources - which observations the operations of key direct selling companies and in-depth interviews with key officers regarding the establishment of the legal entity for direct selling business in Vietnam have been conducted. Research findings revealed that direct selling business in Vietnam was emerging but very high potential and attractive to a number of direct selling companies around the world. Whereas the international direct selling companies sought to entry into the market as soon as possible in order to be competitive and beneficial from being first-movers, trade barriers as well as local laws and regulations prohibited foreign companies to directly distribute the products to customers. Hence, the direct selling companies had set-up several forms of market entry strategies: including licensing; local trading firm by nominees; joint-ventures; foreign direct investments; and foreign wholly-owned trading company.