How to Choose the Right Factory for Lease in Vietnam

Vietnam has become one of these target countries to manufacture products by utilizing the excellent business environment and low labor cost. When searching for a factory for lease in Vietnam, the decision is not only about rent but also whether to choose a facility that satisfies operational requirements, availability of labor, and long-term strategic plans.

Facility choice can provide a significant positive or negative impact on productivity and overall success. This blog discusses the most important considerations of tenants that they must take into account when making leases decisions.

Factor 1: Strategic Location of the Factory for Lease in Vietnam

Proximity to Key Resources

When looking for a factory for lease in Vietnam, it is most appropriate that the facilities provided to the future tenant are as close as possible to a set of facilities they will need. As an alternative to reducing the cost of logistics and securing the process, tenants should preferably choose factories located close to the suppliers and transport hubs. For instance, plants located near ports or roads may help accelerate supply of raw and finished goods.

Furthermore, location in relation to export zones is expected to facilitate streamlining of customs procedures and shortening of lead times. Southern and northern Vietnamese industrial zones are well known for the superior location they occupy in arrangements of trade lines that are highly conducive for tenants from which to expand export.

Infrastructure and Connectivity of the Factory for Lease in Vietnam

Facilities operating in locations with strong infrastructure usually offer their tenants a great deal of operational advantage. This is enabled by continuous, robust provision of energy, water, and high-speed internet, all of which are intrinsic to contemporary production lines.

Connectivity is equally important. Tenants should ensure factories have elevated roads, railways, and harbours. Optimised transport routes can overcome infrastructure limitations as well as guarantee the supply of goods to the final consumer in time. In particular, for firms that are in mutually exclusive industries, a factory for rent in Vietnam with connectivity to certain utilities, e.g., high-capacity power lines, may need to be considered as well.

Factor 2: The Size and Layout of the Factory for Lease in Vietnam

Determining Space Requirements

Defining the appropriate manufacturing size of the factory for lease in Vietnam is the first step in determining operational requirement assessment. Renters should consider how their current production scale and potential expansion can be satisfied.

For example, a manufacturer of consumer products may need and have access to large areas for machinery and storage, whereas a manufacturer of light assembly may have so much less floor space but so much more divided spaces. Selecting a factory that has implications for scaling variability is guaranteed to give the space capacity no matter how large the production scale or the number of production schemes are.

Functional Design Features

A well-designed factory for lease in Vietnam can enhance workflow and boost productivity. One of the concerns of the tenants is having wide loading docks, enough parking space, and high ceilings. For example, large ceilings of a space are a must in retail places that involve heavy machinery or that use bulk goods storage.

Another critical factor is layout flexibility. A modular design allows tenants to reconfigure the space to fit evolving production needs. Machinery, with many of these extensible characteristics, usually provides a long-term positive return to the growing enterprise.

Factor 3: Cost Analysis Before Choosing a Factory for Lease in Vietnam

Leasing Rates

Regional variation in leasing cost should be taken into consideration when evaluating a factory for lease in Vietnam. Tenants are advised to compare rates in industrial districts to determine which districts are viable with regard to rent costs.

Nevertheless, for example, some regions may be available for a very low price, but others have to be leased for a very high price since they are located in close vicinity to point of sale (PoS) export points. Tenants must take these costs into account in the light of the benefits and of the drawbacks of each of these localities. Buildings that contain pre-fit features or furnishings may allow for a slightly higher rate of leasing.

Additional Expenses

Besides leasing per square metre, the lessee should also think of other supplementary costs, such as maintenance fees, renovation fees, and property tax. Ignoring these hidden costs can lead to budget overruns.

For example, an older factory for rent in Vietnam will have to undergo significant modernisation to meet the standards of the trade, whereas a new factory for rent in Vietnam will have maintenance services included in the lease. Accounting for these costs, tenants will be able to make sound financial decisions.

Factor 4: Legal and Regulatory Compliance of the Factory for Lease in Vietnam

Zoning and Permits

Compliance with zoning law for tenants renting a factory in Vietnam is very important. Tenants are also required to confirm that the factory site corresponds to the intended application which can be, for example, manufacturing, assembly or storage.

Furthermore, tenants have to check if the factory possesses adequate licenses to operate. For instance, some of the facilities need environmental impact assessment for complying with local regulations. Working collaboratively with a leasing specialist can assist tenants in meeting these legal obligations.

Labor Law Compliance

In Vietnam, labour statutes are in place to safeguard workers and to protect ethical standards. Tenants are required to make sure that the factory for lease in Vietnam complies with such regulations.

For example, facilities need to comply with safety requirements, such as fire protection systems and emergency openings. Tenants could escape legal problems by examining factories to ensure they comply with labour standards and safety regulations prior to signing the lease.

Factor 5: Workforce Accessibility

Availability of Labor

A factory’s proximity to a skilled workforce is a crucial consideration. Tenants should assess local labour markets to both secure access to skilled and unskilled labour.

Factories in proximity to urban centers can sometimes provide access to a more capacious talent pool, while remote areas may require greater expenditure on employee training. Businesses should pay attention to competition for labor in the area.

Proximity to Employee Amenities

Easy access to amenities, such as transportation, housing, and food services, will maintain high levels of employee satisfaction and retention. Tenants shall pay attention to selecting factories in regions that have those facilities.

For example, a factory for lease in Vietnam located in proximity to a well-served bus system provides workers in the area with ease of commute. Furthermore, regions with ready-made inexpensive housing therefore may be able to attract a consistent labour force for permanent operations.

Factor 6: Factory Amenities and Services

Built-in Facilities of the Factory for Lease in Vietnam

Tenants should compare the availability of built-in resources that can increase operational efficacy. Security systems, fire safety installations, and waste management systems are just a few examples of necessary services.

For example, a factory for lease in Vietnam that has 24/7 security systems may decrease the pressure on tenants for them to add further security measures. With these amenities already made available, it can save time and money.

Additional Services for the Factory for Lease in Vietnam

Factories within industrial parks often provide value-added services such as logistics support or shared facilities. Tenants should explore these options to optimise operations.

For instance, an industrial park with centralised waste management may facilitate compliance with environmental law. These “additional” services can help tenants alleviate greatly the operative load.

Read more:

• Hidden Costs to Consider When Choosing a Factory for Lease in Vietnam: A Guide for Foreign Investors
• Small-Scale Factory for Lease in Vietnam: A Perfect Fit for Startups
• Factory for Rent in Vietnam 101: Top 5 Industries Benefiting the Most

Selection of an appropriate factory for lease in Vietnam involves an extensive evaluation of issues related to location, cost, features, and compliance. For tenants, harmonising these factors with business objectives will guarantee long-term business success. With Vietnam’s thriving industrial sector, investing time and effort in selecting the ideal factory can lead to significant benefits and sustained growth.

If you’re new to Vietnam and looking for a factory for lease in Vietnam, CORE5 Vietnam provides excellent options tailored to your needs. Their factories are strategically located, offering prime access, spacious layouts, and modern facilities designed to enhance your operations. Dedicated support ensures a smooth leasing process and long-term satisfaction.

Stay updated on their latest developments to secure the perfect space for your business. Schedule a tour of their factory village to explore options that align with your requirements. With a commitment to delivering high-quality industrial spaces and exceptional customer service, CORE5 Vietnam helps you find the ideal location to grow your operations and thrive in Vietnam’s dynamic industrial market.