Earlier today, we toured VSIP, a state-owned company that builds industrial parks and ready built factories for a wide variety of industries. The first thing that shocked me was exactly this, how many different types of companies that VSIP caters to. When I asked if they specialized in any one type, they said no. This is an interesting business model that seems to be working for a relatively young company.
VSIP is a joint partnership between two governments, evident by its name: Vietnam Singapore Industrial Park. Interestingly, the company (as of now) only operates in Vietnam; it has not done a single project in Singapore, and there are no plans as of right now. Therefore, it seems Singapore’s only interest in the company is the mutual benefits that it would derive from Vietnam’s economy would contribute to the local and global economies, as well as the profits of the company. The government has entered into several other deals with foreign companies, including the metro project in Ho Chi Minh that is being completed with the government of Japan.
Later we visited II-VI (which is conveniently located in the VSIP industrial park), a company that specializes in the production of specialty glass instruments. Most of these pieces require specialty glass (made by the company in Houston), and many of their products are made exclusively by them for things such as LASIK and shields for dental procedures. The tour of the company was fascinating, if a bit too extensive for what we were prepared for. Some of the machinery was just interesting to watch move, and the workers toiling over tiny pieces of glass was just as interesting. One of the main issues they face is worker retention, losing close to 30 percent of workers over the long holiday. This is not at all uncommon in Vietnam and in their industry, with some companies losing nearly half their workforce. II-VI is good at keeping employees simply by making it a good place to work, offering above minimum wage to all their workers and large bonuses for work output. Despite this, the company has factories in Vietnam because of the large, skilled, and inexpensive workforce and a variety of government incentives that were offered. Relative to the surrounding area Vietnamese education is good, but no matter the credentials all employees at II-VI are trained extensively before starting work.