Effective support for household businesses

According to the Vietnam 2025 report, the country currently has about 6.1 million household businesses, providing jobs for approximately 10 million workers. Among them, over 81.5% of surveyed households reported a decrease in revenue in 2025, 73.7% made only a small profit, and nearly a quarter broke even or suffered losses. These figures reveal the concerning health of an economic sector that, while small in scale, is deeply rooted in social life.

Household businesses have long been considered the flexible part of the economy. With just a breakfast stall, a grocery store, or a market stand, they may not generate large figures in economic reports, but they support many families, maintain consumer spending in residential areas, and create jobs for a significant number of workers. However, their small scale, thin capital, and experience-based operations make them vulnerable to market fluctuations and increasingly strict management requirements.

More worryingly, pressure now also comes from compliance costs, which are becoming a heavy “invisible cost.” About 73% of household businesses believe that legal difficulties and the time spent on regulatory compliance have a very significant impact. It must be affirmed that making business transparent, managing taxes through data, and implementing electronic invoices are correct policies. But if the approach is not suitable for reality and exceeds the capacity of those involved, it can easily become a compliance burden. This is because most small household businesses lack accounting expertise, legal knowledge, or tech-savvy staff; for them, reluctance to change often starts with a fear of clicking wrong, declaring incorrectly, and then being fined wrongly.

Therefore, the fact that only 15.6% of households intend to transition into enterprises in the next two years is not simply a fear of growing bigger, but also a very straightforward calculation: What do they gain from transitioning, what do they lose, can they keep up, and will risks increase?

Thus, encouraging household businesses to transition into enterprises should not be simplistically understood as a way to achieve the target of 2 million enterprises by 2030 under Resolution No. 68-NQ/TW on private economic development. If we only chase numbers, we might create a group of enterprises that are “numerous but not strong,” bearing the name of enterprises but still weak in capital, governance, market, and resilience.

What needs to change first is the mindset of transformation. Household businesses will only boldly grow when they see a path ahead with fewer risks and clearer benefits. It is not possible to simply increase demands for taxes, invoices, and books, and then expect small households to manage on their own to professionalize.

Household businesses will only boldly grow when they see a path ahead with fewer risks and clearer benefits. It is not possible to simply increase demands for taxes, invoices, and books, and then expect small households to manage on their own to professionalize.

What is needed is a sufficiently long transition roadmap, simple procedures, easy-to-understand forms, user-friendly software, and direct advisory points at wards, communes, markets, and business neighborhoods. More importantly, transition must come with real benefits: streamlined administrative procedures, a favorable and open business environment, more effective access to resources, and most crucially, initial accounting support, reduced compliance costs, and minimized overlapping inspections and audits.

When the benefits are clear enough, household businesses will weigh their next steps themselves, instead of staying out due to fears that transition only means more paperwork, more costs, and more risks. Only then will the development of the private economy be truly sustainable and effective, measurable by the vitality of each entity after entering the formal sector.

Vietnam

Vietnam is a Southeast Asian country with a rich and complex history, marked by ancient civilizations, Chinese rule, and French colonialism. It was profoundly shaped by the Vietnam War in the 20th century, but has since emerged as a rapidly developing nation. Today, Vietnam is known for its stunning natural landscapes, vibrant culture, and resilient spirit.

ward

The word “ward” typically refers to a division or district within a city or town, often used for administrative or electoral purposes. Historically, wards originated in medieval European cities as organized sections for local governance, defense, and community representation, such as the wards of London which date back to the

Vietnam

Vietnam is a Southeast Asian country with a rich history shaped by Chinese rule, French colonization, and the Vietnam War, which ended in 1975. Its cultural sites include the ancient town of Hoi An, a UNESCO World Heritage site known for its well-preserved architecture, and the imperial citadel of Thang Long in Hanoi. Today, Vietnam is celebrated for its vibrant traditions, stunning landscapes like Ha Long Bay, and resilient spirit.

ward

A “ward” is a historical administrative division found in many cities, particularly in the United Kingdom, dating back to medieval times. Originating from the Anglo-Saxon tradition of dividing towns for governance and defense, wards were often named after landmarks or local features. Today, they primarily serve as electoral districts for local government, though many retain their historic boundaries and names.