Logistics and Last-Mile Delivery

Vietnam's e-commerce market reached $18.4 billion in gross merchandise value during 2025, and early 2026 data indicates the growth trajectory is holding. While platform competition receives most attention, the underlying logistics infrastructure — particularly last-mile delivery networks — is where structural bottlenecks and investment opportunities are most pronounced.

Market Scale and Growth Trajectory

The e-commerce sector has grown at a compound annual rate of 25% since 2020, according to data from the Vietnam E-Commerce and Digital Economy Agency. Online retail now accounts for approximately 8.2% of total retail sales, up from 4.7% in 2021. The number of online shoppers exceeds 62 million, representing roughly 62% of the population aged 15 and above.

Platform concentration remains high. Shopee, Lazada, TikTok Shop, and Tiki collectively account for an estimated 88% of marketplace GMV. However, the logistics layer is more fragmented. No single third-party logistics provider holds more than 15% market share in e-commerce fulfilment, creating a landscape of regional players, platform-captive fleets, and a growing number of specialised last-mile operators.

The government targets e-commerce to represent 10% of retail sales by 2027, a goal that appears achievable given current momentum. Achieving this target will require an estimated $3-4 billion in additional logistics infrastructure investment, concentrated in warehouse automation, cold chain capacity, and delivery fleet expansion.

The Last-Mile Bottleneck

Last-mile delivery costs in Vietnam average $1.20-1.80 per parcel, compared to $0.80-1.00 in Thailand and $0.50-0.70 in more mature Asian markets. The disparity reflects several structural factors: high urban density combined with fragmented addressing systems; a reliance on motorbike couriers that limits parcel size and weight; and the prevalence of cash-on-delivery, which increases failed delivery rates and return logistics costs.

Same-day and next-day delivery coverage is currently limited to Hanoi, Ho Chi Minh City, and parts of Da Nang. Outside these urban cores, standard delivery times extend to 3-5 days. The disparity creates a two-tier market in which urban consumers enjoy service levels approaching those of Singapore or Seoul, while peri-urban and rural consumers face delays and higher shipping costs.

Several domestic operators are attempting to address the last-mile gap through technology deployment. Route optimisation algorithms, crowd-sourced delivery platforms, and automated parcel lockers are being trialled in major cities. Early results suggest cost reductions of 15-20% are achievable, but scaling these solutions nationally will require significant capital and coordination with local authorities on locker placement and traffic regulations.

Warehouse and Fulfilment Infrastructure

Modern warehouse stock suitable for e-commerce fulfilment totals approximately 2.8 million square metres nationwide, of which roughly 60% is located in the southern provinces surrounding Ho Chi Minh City. Vacancy rates in grade-A warehouse facilities have fallen below 8%, indicating tight supply relative to demand.

Rental rates for e-commerce-grade warehouses in Binh Duong and Long An provinces have increased by 12-15% annually over the past three years, reaching $4.50-5.20 per square metre per month for facilities with temperature control and automated sorting. Lease terms are shortening as tenants seek flexibility to scale operations, with three-year terms now more common than the five-to-seven-year contracts typical in traditional logistics.

Cross-border e-commerce fulfilment is an emerging segment with distinct requirements. Warehouses serving import-export e-commerce need customs-bonded status, specialised inventory management systems, and proximity to international airports or seaports. The Noi Bai and Tan Son Nhat airport zones are seeing concentrated development in this category, with several regional logistics operators establishing bonded facilities to serve ASEAN-China trade flows.

Regulatory Environment for Logistics Investment

Foreign investment in logistics services is permitted under Vietnam's WTO commitments, but certain sub-sectors remain restricted or subject to joint venture requirements. Domestic courier services, for example, require Vietnamese majority ownership. Warehousing and freight forwarding are fully open to foreign investors.

Decree 163/2023/ND-CP on logistics services clarified several licensing requirements but created uncertainty around the classification of technology-enabled logistics platforms. Operators that match shippers with independent drivers without owning vehicles argue they fall outside traditional freight forwarding licensing. Regulatory guidance on this question remains pending, and the outcome will affect the operating model of several venture-backed domestic platforms.

For investors, the e-commerce logistics sector presents a mix of scale opportunity and operational complexity. Industrial real estate in key logistics corridors offers the most straightforward risk-return profile. Last-mile operations require deeper operational expertise but offer higher margins for those that can achieve density and route efficiency. Platform-captive logistics models, while currently dominant, may face margin pressure as platforms seek to reduce subsidies and push fulfilment costs onto sellers.