Payment Practices Barometer

  • Vietnam
  • Agriculture,
  • Chemicals/Pharma,
  • Consumer Durables,
  • Food,
  • Metals,
  • Steel,
  • Textiles

28th June 2022

Companies polled in Vietnam said they needed measures to avoid being liquidity squeezed due to the impacts of customer payment default on the business.


The 2022 edition of the lol竞猜(中国)联赛赛事官网 Payment Practices Barometer survey findings for Vietnam is a valuable opportunity to hear directly from companies about how their business operations are coping with the disruptive impact of the current challenging economic and trading circumstances.

Topics covered include: payment terms set for business-to-business (B2B) customers, the average time it takes to turn overdue B2B invoices into cash, the impact of late or non-payment on the business, and expected challenges to profitability during the coming months.

The survey questionnaire was completed by businesses in Vietnam during Q2 2022. Responses given by companies polled are contained in the report for Vietnam, which is part of the June 2022 edition of lol竞猜(中国)联赛赛事官网 Payment Practices Barometer for Asia available on this website by clicking here.

Key takeaways from the report for Vietnam

Sales on credit increase amid concern over payment defaults and DSO

  • Trading on credit with B2B customers is trending upward in the Vietnam market, with a prime focus on encouraging repeat business among existing loyal and trusted customers. One significant factor related to this is a rise in the number of companies who reported offering more liberal payment terms. However, almost half of the total value of B2B sales on credit remained unpaid at the due date, prompting the threat of liquidity squeeze on businesses. An extra concern expressed by businesses is the level of debts written off as uncollectable.
  • Partly due to the longer payment terms being granted, nearly half of the businesses polled said their Days Sales Outstanding (DSO) is worsening. This highlighted there was a need to enhance their credit management process, with the use of various measures like the avoidance of credit risk concentration and more rigorous checks on the credit quality of customers. Some businesses told us they requested cash payments on delivery, while others were offering discounts for faster settling of invoices .

Confident outlook, but crucial focus on strategic credit management

  • A generally positive outlook was revealed among businesses in Vietnam, despite the effects of the pandemic and concern about supply chains being threatened with disruption by global economic instability. There is an almost universal expectation that B2B payment practices of customers will improve in the coming months, while another strong indication of business confidence in the Vietnam market is that a significant number of companies also anticipate an increase in trading on credit.
  • The need for strong strategic credit management was a crucial theme throughout the survey. Some companies in Vietnam told us they preferred to manage this in-house even with the danger of a strain on their resources, but an increasing number said they were opting for credit insurance cover to protect the strength of their business. Reported benefits of this strategy, aimed at protecting the business against customer payment default and bad debts, include access to in-depth risk information and regular market intelligence, while also helping to improve DSO and free up working capital

Key survey findings for Vietnam

  • Trading on credit with B2B customers on the rise, focus on customer loyalty
  • Credit sales boosted by longer time to pay, companies seek insurance protection
  • Unpaid B2B trade debt and write-offs dent business liquidity
  • Customer payment default mainly due to liquidity issues and admin troubles
  • Avoidance of credit risk concentration and credit control utmost priority
  • Business confidence high, positive outlook for B2B trading on credit
  • Concern over DSO worsening and coping with extra demand as economy rebounds

Interested in finding out more?

Please download the complete report for a complete overview of the payment practices in Vietnam and in the following local industries:

  • Agri-Food
  • Chemicals/Pharma
  • Consumer durables
  • Steel/Metals
  • Textiles/Clothing
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