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10 key factors to consider when choosing warehouse in Vietnam

May 09, 2024 08:39 AM

For foreign direct investment (FDI) enterprises operating in manufacturing and trading sectors in Vietnam, finding a good warehouse plays a crucial role as it not only helps store and distribute goods but also optimizes costs for businesses. However, to find reputable and quality warehouse in Vietnam, businesses should consider the following 10 factors. Location Location […]

For foreign direct investment (FDI) enterprises operating in manufacturing and trading sectors in Vietnam, finding a good warehouse plays a crucial role as it not only helps store and distribute goods but also optimizes costs for businesses. However, to find reputable and quality warehouse in Vietnam, businesses should consider the following 10 factors.

Location

Location is the first factor that businesses should consider when searching for warehouse in Vietnam. Because the location determines the delivery time and transportation costs for businesses. If the warehouse is far from economic centers or residential areas, the aforementioned costs will increase significantly.

When choosing a warehouse location for rent in Vietnam, you should consider transportation factors in the area such as ports, airports, city centers, etc., to avoid factors like traffic congestion, weight restrictions, one-way streets, no U-turns, parking restrictions… which can cause difficulties in transporting goods, increase labor and time costs.

Warehouse Area

Warehouse area is one of the top concerns for businesses because the main purpose of renting is to store goods. Therefore, you need to consider and choose warehouses with suitable areas for the quantity of goods of the business. In addition, you also need to pay attention to warehouse access factors such as spacious space for easy arrangement, transportation of goods, packaging of products, and other necessary activities.

Considering choosing the appropriate warehouse size to meet the needs of the business

Considering choosing the appropriate warehouse size to meet the needs of the business

On the other hand, businesses should carefully calculate to determine the suitable warehouse size for rent, while warehouse designs and layouts must ensure optimal movement to help improve operational efficiency.

Infrastructure and transportation

Most warehouse in Vietnam nowadays meet basic standards of infrastructure and transportation for business owners, including:

  • Material handling equipment
  • Lighting system
  • Ventilation system
  • Temperature control mechanism
  • Security camera system and firefighting equipment

These equipment with certain important features help maintain product quality in the warehouse, especially perishable items.

Furthermore, businesses also need to consider port facilities, parking space for transport vehicles to ensure smooth operations.

Warehouse amenities

When renting warehouse in Vietnam, businesses should pay attention to accompanying amenities such as: loading and unloading teams, trucks, specialized forklifts, hand trucks, pallets, and other necessary machinery systems to support warehouse operations. Additionally, you should also consider the compatibility of the warehouse with the technology devices that the business wants to integrate. Incorporating technology into inventory management, monitoring, and tracking of goods in and out of the warehouse will enhance operational efficiency significantly.

Security measures

In addition to the above factors, warehouses need to be ensured security and safety measures such as: fire protection system, camera system arranged throughout, alarm system, lighting system, emergency drainage system to prevent flooding, locking system, warehouse security guards… These factors can be observed when you visit the warehouse. Moreover, a well-maintained warehouse floor with clear signs also helps minimize the risk of accidents and injuries to personnel.

Cost

Warehouses that meet the criteria of the business but cost is a factor that affects the final decision. Because the cost of renting a warehouse needs to meet the criteria that match the business’s budget.

Therefore, when researching warehouse rental prices, you should note:

  • Additional fees and contract terms
  • Incurred service fees such as loading and unloading, inventory management, delivery, packaging…
  • Maintenance costs
  • Other expenses provided by the warehouse owner

Considering warehouse rental costs and the above services will help businesses minimize the potential costs that may occur during warehouse operations, affecting the business’s budget.

For businesses with large warehouse rental needs, negotiate with warehouse owners to get the most competitive prices.

Businesses should negotiate with warehouse owners to get the best warehouse rental rates

Businesses should negotiate with warehouse owners to get the best warehouse rental rates

 

>>> See more: Increasing demand for logistics real estate in Vietnam

Lease terms

When proceeding with the contract procedure, businesses need to carefully read the lease terms to avoid future disadvantages. Some lease terms to consider include:

  • Rental fees, deposits
  • Procedures for import and export, incurred costs
  • Lease duration
  • Rate of increase if renting long term
  • Validity of the contract
  • Rights and obligations of both parties
  • Commitments to ensure security and safety of goods during the lease period
  • Contract appendices

Compliance with legal requirements and regulations

When planning to rent pre-built warehouse in Vietnam, businesses should first research basic information such as: name, tax identification number, legal representative, headquarters, establishment time… Furthermore, when offering warehouse rental services, warehouse owners must comply with legal regulations as follows, businesses can rely on these factors to avoid mistakenly choosing a “ghost company”:

– According to Article 10 of the Law on Real Estate Business No. 66/2014/QH13, individuals, organizations engaged in warehouse rental business must have a legal capital of 20 billion VND or more.

– According to Article 7 of Decree No. 79/2014/ND-CP, warehouses storing goods are a group of industries prone to fire and explosion hazards, so they must strictly comply with fire prevention and fighting regulations, including:

  • Clear fire prevention and fighting signs, prohibition signs, guidance signs
  • Assignment of fire prevention and fighting duties and responsibilities
  • Safe electrical system, lightning protection, static electricity protection, or devices using electricity, generating sparks, generating heat.
  • Warehouse fire brigade must be professionally trained.
  • Having plans to respond to fire and explosion accidents in accordance with Article 21 of Decree No. 79.
  • Having fire prevention and fighting systems and equipment.
  • Warehouses must undergo periodic fire prevention and fighting inspections by competent authorities.

Ensure compliance with fire prevention and fighting regulations

Ensure compliance with fire prevention and fighting regulations

Property developers

Businesses should thoroughly research information about warehouse owners before deciding to rent warehouse in Vietnam. Currently, reputable property developers all have information available on their official websites, in the press, or in clear business registration information for partners to look up. Moreover, investors should visit warehouses to receive specific advice and gain a general overview of the warehouse they are planning to invest in.

Support and services

Support services are usually specified in the contract, and businesses should thoroughly understand them and seek clarification from the service provider. Additionally, attention should be paid to the warehouse owner’s responsibilities in cases such as fire or theft resulting in loss of business assets, and how the service provider handles or compensates for damages should be reasonable. These matters should also be clearly stated in the contract between the two parties.

With many warehouse rental service providers emerging in Vietnam, GAW NP Industrial is a name that many FDI businesses have been seeking in recent years. Despite being a latecomer compared to its predecessors in this field, GAW NP Industrial has drawn from the experiences of those who came before to provide comprehensive logistic services to the market and meet the warehouse rental needs of many domestic and foreign businesses.

The warehouse rental services of Gaw NP Industrial offer safe, compliant, efficient, and tailored storage solutions to customers thanks to strengths such as modern infrastructure and equipment, a complete security and safety system for goods, warehouses located in key economic areas, diverse rental areas with attractive cost and tax incentives for businesses.

Below are 02 warehouse rental locations in Vietnam under Gaw NP Industrial:

– GNP Dong Van 3:

In addition to being known as quality pre-built warehouse located in the Dong Van III Industrial Park in Ha Nam province, GNP Dong Van 3 also has the advantage of being a large warehouse for rent with a minimum rental area of 9,100 square meters.

Warehouse rental services in Vietnam - GNP Dong Van 3

Warehouse rental services in Vietnam – GNP Dong Van 3

Furthermore, GNP Dong Van 3 also boasts an extremely favorable geographical location, helping businesses reduce transportation costs from the warehouse to nearby areas such as:

  • 50km from Hanoi Capital
  • 80km from Noi Bai International Airport
  • 130km from Cat Bi International Airport
  • 120km from Lach Huyen Deep Water Port
  • 130km from Hai Phong Port

Some features of GNP Dong Van 3 warehouse:

  • Clear height: 10 meters
  • Floor load capacity: 3 tons/m2 with reinforced concrete floor quality
  • Power supply: 3-phase electricity with 270 KVA/unit
  • Design:columns-free
  • Amenities: fire protection and fighting system, wastewater treatment, 24/7 security…
  • Tax incentives: exempt 2, reduce 4 ((corporate income tax reduction for the first 2 years and continued 50% reduction for the following 4 years)
  • Handover: Ready for rental

>>> See more: Ha Nam’s warehouse rental market attracts international investors

– GNP Nam Dinh Vu:

The pre-built warehouse model GNP Nam Dinh Vu in Hai Phong City is one of the warehouse in Vietnam that many FDI businesses seek after GNP Dong Van 3. With a minimum rental area of 4,896 m2, GNP Nam Dinh Vu also offers attractive tax incentives with exemption 4 reduction 9 for businesses. Specifically, businesses will enjoy corporate income tax reduction for the first 4 years and continue to enjoy a 50% reduction for the following 9 years.

Warehouse rental services in Vietnam - GNP Nam Dinh Vu overnight

Warehouse rental services in Vietnam – GNP Nam Dinh Vu overnight

With attractive tax policies combined with a strategic geographical location near key areas such as: Van Don Airport (80 minutes), Cai Lan Port (48 minutes), Hai Phong Port (25 minutes), Lach Huyen Deep Water Port (15 minutes), Hai Phong City center (28 minutes), Cat Bi International Airport (20 minutes), Noi Bai International Airport (110 minutes), Hanoi Capital (100 minutes).

Some features of the pre-built warehouse GNP Nam Dinh Vu:

  • Clear height: 9.5 meters
  • Floor load capacity: 3 tons/m2 with reinforced concrete floor quality
  • Power supply: 3-phase electricity with 200 KVA/unit
  • Amenities: fire protection and fighting system, 24/7 security…
  • Tax incentives: exempt 4, reduce 9 (corporate income tax reduction for the first 4 years and continued 50% reduction for the following 9 years).
  • Handover: Ready for rental

>>> See more: 9 essential points to evaluate when renting a warehouse in Hai Phong

Conclusion

With the above information, businesses have gained more useful information about rental services warehouse in Vietnam. To learn more about Gaw NP Industrial’s warehouse services, customers can contact directly at Hotline: +84 789 75 77 88 for specific advice.

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