Factory Setup Vietnam: 7 Proven Stages

Factory setup in Vietnam runs on a fixed sequence, and the projects that finish on time are the ones that respect the order rather than the ones that push hardest on any single step. This guide sets out the seven stages from site decision to first production, with the dependencies that determine the critical path.

Table of Contents

The seven stages of factory setup

1. Site and structure decision

Zone or standalone, examined in our factory location guide, together with the corporate structure and which entity will hold the project.

2. Investment licensing

The investment registration certificate, preceded by investment policy approval where triggered, and company registration – which under the current law may come first.

3. Land and lease

Executing the lease or sub-lease and taking handover, with the terms in our land lease guide. Handover starts the construction clock and the security release schedule.

4. Design and permits

Basic design appraisal, the environmental permit, fire prevention design approval, and the construction permit. These run partly in parallel but each has predecessors.

5. Construction

Contractor selection and the EPC or construction contract, supervision, and interim inspections. Capital must be contributed on the registered schedule during this phase.

6. Acceptance and operating permits

Construction acceptance, fire safety acceptance, environmental confirmation, and any sector-specific operating licence. This stage is routinely underestimated – a completed building is not an operating factory.

7. Commissioning and first production

Equipment import using the exemption in our import duty exemption guide, installation, trial runs, workforce recruitment and training.

What actually delays a factory setup programme

Four things, in order of frequency. Land handover slipping, which pushes everything downstream. Environmental and fire approvals started too late, because sponsors treat them as construction paperwork rather than as design inputs. Capital contribution missing the ninety-day window or the registered schedule. And equipment arriving before the exemption documentation is in order, which strands machinery at the port.

None is unforeseeable. All are avoided by building one integrated programme rather than treating licensing, construction and tax as separate workstreams with separate owners.

Factory setup FAQs

How long does it take?

For a zone-based project of moderate size: two to three months licensing, three to six months design and permits with overlap, then construction on the contractor’s programme, and one to two months to operating acceptance. Standalone sites add materially at the front.

When should the schedule in the certificate be set?

Realistically, and with contingency, because it becomes the benchmark for the security in our project security deposit guide and for any later extension.

What about funding?

Charter capital and offshore borrowing each have their own rules – see our project financing guide. Texts are published via the Ministry of Finance.

Governing the factory setup programme

The single strongest predictor of an on-time Vietnamese factory is not the contractor or the province – it is whether one person owns the integrated programme. Licensing, land, design, permits, construction, tax and equipment import interlock, and each has a different counterparty.

Three governance elements make that work. One integrated schedule showing every approval, its predecessors and its owner, reviewed weekly rather than monthly. A single escalation point with authority to decide across workstreams, since most delays are caused by decisions waiting rather than by regulators.

And a monthly reconciliation of actual progress against the schedule recorded in the investment certificate, so divergence is amended under our IRC adjustment process while it is small.

Groups that run factory setup this way routinely deliver in the timeframes above. Groups that run licensing, construction and tax as three separate projects with three separate owners discover the interlocks at the point where they have already cost a quarter.

Factory Setup in Vietnam: 7 Proven Stages From Site to Production