While the global economic crisis has dealt a strong blow on enterprises in many business fields, software firms still can live well because they can grab the opportunities in the crisis.
Software outsourcing help IT firms survive crisis
Software firms prosper
Reports showed that 26,340 enterprises had to stop operation or shut down in the first six months of 2012 alone, an increase of 5.4 percent in comparison with the same period of the last year. In June alone, 4,110 companies declared bankruptcy or halted operation, including the 610 enterprises dissolved.
However, these do not include software firms. IT is one of the very few business fields remaining unhurt by the “crisis storm.”
FPT Software had reportedly obtained the turnover increasing by 30 percent in comparison with the same period of 2011, Vnext Software, specializing in doing the software outsourcing for Japanese partners, has also reported the 30-40 percent growth rate in turnover. CMC Soft has seen the 20-25 percent growth rate in the revenue from software outsourcing.
SmartHome, a subsidiary of the security software giant BKAV, which specialises in making and trading smart products has reported the revenue growth rate of 1.5-2 times over the same period of the last year.
Great opportunities found in crisis
Tran Vu Viet Anh, a senior executive of CMC Soft, said the global economic recession has had both positive and negative impacts on software firms.
Anh said a lot of foreign partners have shut down their business in the crisis, or cut down expenses, which has badly affected the company’s growth. However, also because of the crisis, a lot of enterprises, which previously spent big sums of money to develop software, now think of outsourcing their projects to others in order to cut down expenses.
Vietnam proves to be a good choice for the enterprises, since the outsourcing fees in Eastern Europe, India and China are much higher than Vietnam’s.
“In the crisis, CMC Soft’s loyal clients have assigned more works to CMC Soft, especially the works relating to making software for mobile phones,” Viet Anh said.
Nguyen Tat Dac, General Director of VNextSoftware, has noted that while the line graph of the economic growth goes down, the one of the software firms’ revenue goes up.
Dac said that VNextSoftware would focus on developing the CRM software (customer relationship management), adding the number of Japanese clients has been increasing rapidly with a lot of job opportunities.
The economic recession has not only brought foreign clients to Vietnam, but also the job opportunities from the domestic market.
Nguyen Manh Hung, Business Director of SmartHome, has noted that in the current difficulties, clients have to fasten their belt. Instead of buying expensive imports, they now tend to look for domestic products which have lower prices and the same quality.
In previous years, SmartHome’s clients were mostly individuals or families, while it now receives orders from big projects as well. The company’s products are just equal to 40-50 percent of the import products, while some products are even cheaper than Chinese ones, which, in minds of consumers, mean dirt cheap and low quality products.
Phi Anh Tuan, Deputy Chair of the HCM City Informatics Association, has forecast that software programming for mobile devices would be one of the careers to develop most strongly in the time to come.
Mobile phone devices, which have become the inseparable things for people, are gradually replacing laptops and desktop computers. Therefore, it is foreseeable that the demand for the software pieces for mobile phones would increase rapidly, which promises more jobs for IT firms.
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