TABLE OF CONTENTS
INTRODUCTION
CHAPTER 1: FACTS OF VIETNAM FREIGHT
FORWARDING INDUSTRY
1.1. Definition of “Freight Forwarder”
1.2. The importance of Freight Forwarding industry
1.2.1. To the national economy
1.2.2. To enterprises
1.3. Facts of the industry
1.3.1. Advantages to the development of the industry
1.3.2. Pressures on Vietnam freight forwarding
industry
1.4. Comments on the facts of Vietnam freight forwarding
industry
CHAPTER 2: VIETNAM FREIGHT FORWARDERS
ASSOCIATION (VIFFAS)
2.1. Introduction of VIFFAS
2.1.1. History of VIFFAS
2.1.2. Management Board of VIFFAS
2.1.3. Statues and Standard Trading Conditions of
VIFFAS
2.2. Functions & Main Activities of VIFFAS
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INTRODUCTION
Freight forwarding industry plays a significant role in expanding trade by
procuring efficient and economic modes of transport. It creates necessary conditions to
ensure that import and export products may timely reach their destinations and helps to
deliver efficiently goods from sellers to end users. This national industry is still young
in Vietnam, but it has gradually contributed to the improvement of the country’s
balance of payment by assisting export promotion and giving support to the national
Carrier & Insurers. Vietnam Freight Forwarding industry has played, to somewhat
extent, an active role in facilitating trade by simplifying and rationalizing trade and
documentary procedures, thereby reducing transport cost.
Vietnam went through a lot of hindrances and difficulties to reach the splendid
achievements over the past years. In international economic integration process,
challenges remain considerable but there are always opportunities for the development
of national economy. Freight forwarding industry also finds its opportunities to grow
up, contributing to the national development strategy of restructuring the economy,
intensifying the industrialization & modernization process and laying the foundation for
rapid & sustainable development of national economy.
During my internship at Vietnam Freight Forwarders Association (VIFFAS) in
Ho Chi Minh City, I have learnt a lot about the facts of Vietnam freight forwarding
industry and the Association’s importance to the industry, especially in today’s
economic integration process. Therefore, I chose the topic “Facts of Vietnam Freight
forwarding industry and the role of Vietnam Freight Forwarders Association
(VIFFAS) to the industry in international economic integration process” for my Field

Some of the typical information reviewed by a freight forwarder is the commercial
invoice, shipper's export declaration, and other documents required by the carrier or
country of export, import, or transshipment. As an analogy, freight forwarders have
been called travel agents for freight.
1.6. The importance of Freight Forwarding industry
1.6.1. To the national economy
Freight forwarding activities plays an essential role in producing, circulating and
distributing import & export goods. Around the world, the average cost of freight
forwarding service for imports and exports equals about 15 percent of the value of
import or export goods, the highest rate accounts for 40 percent and the lowest around
10 percent. Experts predict that Vietnam exports and imports together could come to
US$200 billion per year by 2017, and thus freight-forwarding services could earn
Vietnam about 30 billion USD in 2016. Accordingly, the development of freight
forwarding industry will naturally contribute to the improvement of national economy
as well as Vietnam freight forwarders if they know the tips to do their business and
catch their own opportunities in the international economic integration process today.
1.6.2. To enterprises
Freight forwarding in particular and Logistics in general are the keys for
enterprises to deal the input and output problems. They help to change the input
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material and maximize the flow processes of material, goods and services and therefore
reduce the cost and enhance enterprises’ competition. Without freight forwarding or
logistic services, enterprises’ business activities would meet huge troubles and may
come to a deadlock.
1.7. Facts of the industry
1.7.1. Advantages to the development of the industry
Freight-forwarding industry is still young in Vietnam, but it has rapidly become
a developing field and played a significant role in the national economy. Now Vietnam

exports
mil. tones 73.51 169.49
Transit cargo (of Laos,
Thailand, Cambodia, South
China)
mil. tones 3.19 9.31
Goods transferred between
foreign ships
mil. tones 9.50 49.00
Airway tone 127.629 431.644
Source: Vietnam Maritime Department, Ministry of Planning and Investment, and
Vietnam Airlines
The third, joining WTO, ASEAN Free Trade Area and normalizing relationship
with the U.S have created the best conditions for the development of many industries
and services, including freight-forwarding industry. There are more and more money
from ODA projects, non-governmental organizations and foreign investors pouring into
Vietnam to raise infrastructure. Many deep-water ports and airports have been upgraded
to attract customers. Land route system as well as railway system have been repaired
and renewed to serve in transportation.
The fourth, freight forwarding and logistics activities have drawn the attentions
of Governmental institutions as well as local and foreign freight forwarding enterprises.
As a result, many container ports and airports have been taken into long-term
investment projects and development programs. In addition, land routes and railway
systems are being upgraded and expanded. Therefore, there are 25 leading international
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logistic services providers (LSP) established their branches in Vietnam to exploit this
abundant source of income.
Finally, the strong development of Information technology has significantly

b/ Inside pressures
Vietnamese businesses in the freight forwarding industry are facing various
difficulties now. According to Mr. Nguyen Tham, Deputy President of Vietnam Freight
Forwarders Association (VIFFAS), freight-forwarding enterprises are held back by
their small size, lack of skilled employees, and minimal cooperation among businesses
in the field. General Secretary of VIFFAS, Mr. Vu Xuan Phong also stressed that poor
transport infrastructure, small financial scales, unskillful employees, low technological
capacity, insufficiency of Government laws & regulations as well as poor
understanding of international laws and marine transport procedures & policies and
loose co-ordination are the inner problems that Vietnam Freight Forwarding industry
needs to get over.
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The first problem is poor infrastructure. Many ports in Vietnam Port System
are very old and out-of-date. They are shallow in draft and their yard & warehousing
systems are insufficient for accommodating containers and cargo. Today, there are only
a few ports with modern handling facilities and equipment to serve big ships.
Accordingly, freight-forwarding activities are conducted mainly in big cities and their
suburban areas such as Ho Chi Minh City, Hanoi, Hai Phong, Da Nang, and Qui Nhon.
Airports and airlines are also undeveloped. There are about 100 airports
throughout Vietnam, but only three serve international routes. Those three international
airports are known as Tan Son Nhat, Noi Bai and Da Nang. Moreover, there are only
two national airlines, Vietnam Airline (state-owned) and Pacific Airline (joint stock),
which are basically passenger carriers. Vietnamese freight forwarders use these two
lines for approximately 20% of their cargo volume, whereas the other 80% is contracted
to the foreign airlines market.
Land transportation system is uncompleted. The road system of Vietnam is
about 106,000 km long. Land transport accounts for about 65% of domestic passenger
and cargo transport. While pre-export and post-import legs for door-to-door shipments

operators.
In addition, many companies have 3-5 staffs only, including managers. With
such modest capital and few staffs, the companies just can fulfill simple works for
separate clients. In other words, Vietnam still lacks “full-package” or “door to door”
logistic providers, who can provide logistics or freight forwarding services sufficiently
and completely. Moreover, while logistics are going globally, most Vietnamese
logistics companies do not have overseas representative offices. That creates the risk of
losing international market share and being lagged behind.
One more problem to freight forwarding enterprises is human resource, whose
poor quality and professional skills do not satisfy the demand of logistic activities.
Professional training in logistics/freight forwarding business is unavailable in Vietnam,
and employees who are working in this field have to get their training with simple
theories and unfulfilled reality. As a result, most of them do their work basing on
experiences without total knowledge and skills.
Lacking of modern technology is also a big trouble for Vietnam freight
forwarders. Applying modern technology in freight forwarding activities is one of
efficient measure to reduce inconvenient procedures and minimize cost for enterprises.
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