IT firms earn big money from software outsourcing despite economic difficulties

August 17th, 2012 by Amrinder Leave a reply »

The software outsourcing market keeps growing stably since the beginning of the year with the volume of orders higher by 20 percent than the same period of the last year, thus allowing information technology (IT) firms to live well on software outsourcing contracts.

Hoang Vu Quynh Ha, Director of Somotsoft, a software development firm, said on Thoi bao Kinh te Saigon that the number of orders has increased by 30-40 percent since early July in comparison with the months before. Therefore, Somotsoft has decided to recruit more software programmers, leading to the firm’s personnel increasing by 15-20 percent.

“The demand has also become more diversified. There is a growing tendency of demanding the software pieces for mobile devices instead of the software for desktop computers,” Ha said.

“Besides, the clients also demand the products integrated with multi-languages which can run on different platforms,” Ha added.

Somotsoft has also reported the satisfactory software product export turnover to the US. It is expected that the company’s turnover in 2012 would be higher by 20 percent than 2011.

CMC Soft has announced that its total revenue from software exports was as high as 500,000 dollars in the short period from April 1 to July 2012.

Nguyen Thien Tam, Business Director of Sutrix Media Vietnam, has reported that the volume of orders placed by clients has increased by 60 percent.

“European countries have bogged down in the economic crisis, which has forced businesses to cut down expenses. Therefore, they tend to outsource the software processing to other countries,” Tam explained.

Also according to Tam, Vietnam proves to be a good address for the companies to outsource to, because the fees are very cheap and in no way less competitive than India and China.

Meanwhile, according to Tran Phuc Hong, Director of TMS, the value of the software outsourcing contracts has increased by 20 percent in comparison with the first two quarters of 2012.

“We have one or two new clients every month from the US, Australia, Japan and European markets. Especially, the number of orders from Australia has been increasing very rapidly,” Hong said.

Meanwhile, TMS has just signed contracts with the new partners from the UK and Malaysia.

Mai Hoai An, Director of IMT Solution, has noted that he can see a growing tendency of European software firms going to Vietnam to hire Vietnamese engineers to fulfill the orders for the parent companies. These are the stories of Norwegian Cateno Company, the US’ Cargigi Inc or Dutch Devinition.

It’s obvious that Vietnam can get benefit from the tendency, because Vietnamese small and medium enterprises can get involved in the implementation of the contracts, thus getting “pieces of the cake” for themselves.

North European countries also tend to head for Asia instead of East European countries, because the outsourcing costs have been increasing sharply in the East European countries, which would be the golden opportunities for Vietnamese enterprises at this moment.

“IMT Solution is implementing four projects for the new clients from North Europe,” An said.

Sutrix Media Vietnam is now pushing up the activities of training and leasing personnel for software programmers after it has realized the increasingly high demand for software engineers.

The company reportedly is now leasing 80 workers to 10 businesses.

Meanwhile, Buu dien newspaper has reported that Vietnamese software firms tend to expand their relations in Asia, while continuing to exploit the familiar markets of Japan or the US.



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