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Viet Nam
Industrial Park Situation
Text by Saito Hiroshi
The 7th topic: Factory Security (Security Systems)
When operating factories and warehouses in Vietnam, security measures are crucial. If proper security measures are not taken to prevent the intrusion of suspicious individuals from the outside and to prevent theft of equipment and products within the factory, it can lead to severe consequences. While Vietnam is generally a safe country with relatively few violent crimes like homicides, petty crimes such as theft and burglary are not uncommon. Especially recently, due to the impact of the COVID-19 pandemic, many factory workers have been laid off. Some of them, harboring resentment, have been attempting to break into factories at night to steal products. In this discussion, I would like to provide an overview of factory security (security systems) in Vietnam.
1. Special circumstances unique to Vietnam
Despite the continuous economic development in Vietnam, with high-rise buildings lining up in major cities like Hanoi and Ho Chi Minh City, making it seem much more convenient and developed than provincial cities in Japan, the reality is that old, bad practices such as bribery and collusion are still rampant.
A Japanese factory manager in Vietnam mentioned that when he proposed promoting a Vietnamese purchasing staff member
with five years of experience to a sales manager position and increasing his salary by 1.5 times (from US$400 to US$600), the person declined. In other words, it seems that the amount of kickbacks is much larger than the salary increase of US$200.
2. Security system for industrial parks
The security system varies for each industrial park, but in the case of industrial parks that operate rental factories, they often surround the entire site with fences and station security guards at the gates to manage access to the premises. For employees including factory workers, they issue cards that allow them to enter upon presentation. For third parties such as vendors who need to enter the premises, they are required to notify the security guards in advance or the security guards will confirm with each tenant before granting entry. Of course, surveillance cameras are typically installed at the gates as well. However, even for rental factories, the security for each tenant’s factory must be arranged by the tenants themselves. So they need to provide for both human security with stationed guards, as well as mechanical security like online systems and surveillance cameras, or a mix of both.
3. Human security for the factories
Major Japanese security companies like ALSOK and SECOM have expanded into Vietnam, and they can provide well-trained security guards, which is reassuring. There have also been incidents where factory employees colluded with guards from local security companies to remove and resell the company’s products under the guise of daytime shipments. So just having security guards does not necessarily mean it’s completely safe, as they could be involved in such schemes. It’s also necessary for the Japanese manager to communicate with the security guards on a daily basis, by checking in with them, to maintain good communication.
4. Online mechanical security
This involves installing various security sensors and having a security company’s monitoring center provide 24/7 remote surveillance. If an abnormal alert is triggered, security company staff will respond and dispatch to the site. This is an effective security measure for times when the facility is unattended, such as at night or on holidays. This type of system is available not only from the Japanese security companies mentioned above, but also from local security companies in Vietnam. I would recommend comparing the features and costs of the systems from various providers, and selecting the one that best fits the scale of your factory.
5. Surveillance cameras and access control systems
These are necessary to gather evidence in case any incidents or trouble occur.
If theft incidents of equipment or products from the factory happen, decisive evidence can be obtained through the surveillance cameras. The placement and number of surveillance cameras must be carefully determined in consultation with the security company to minimize blind spots. Also, as an EPE (Export Processing Enterprise), the installation of surveillance cameras based on the instructions (location and number) from the authorities is essential to receive the tariff exemption privileges.
6. Summary
Unfortunately, in Vietnam, the morale of workers at the employee level is often still quite low. Even for hardworking and honest employees, there is always a risk that they may succumb to temptation and commit theft incidents like the ones mentioned above. This is something that needs to be kept in mind. It is also important to ask the security company representatives about specific past incidents they have encountered, and to determine what kind of systems would be effective in preventing such issues. This information can be crucial in making the right decisions about the security measures to implement.
齊藤公(Saito Hiroshi)
Business Advisor
G.A. Consultants Vietnam Co., Ltd
After graduating from university, he joined a PHP research institute and served as the head of the New York office. He then worked on the “Nagoya Port Redevelopment Project” at a subsidiary of the Chubu Nippon Broadcasting (CBC) company. He later shifted his base to Asia, where he was involved in the launch of “FM96.3” in Singapore, and the creation of “Hello Vietnam” and “Invest Asia” magazines in Vietnam. He then joined BW Industrial Development JSC, Vietnam’s largest rental factory development company, where he was responsible for attracting Japanese manufacturing companies. Currently, he is active as a consultant for the entry of Japanese companies at “G.A. Consultants”, one of the longest-standing Japanese HR consulting firms in Vietnam.
