Introduction

Expanding into Vietnam’s growing cosmetic market presents exciting opportunities, but it also requires strict regulatory compliance. One of the first decisions cosmetic businesses must make is whether to establish a legal company in Vietnam or use the services of a Cosmetic Notification Holder. Both options come with distinct benefits, challenges, and legal implications. This article offers a detailed comparison of the two approaches, helping foreign investors and businesses make an informed decision based on their market entry strategy.

1. Establishing a Company in Vietnam

Establishing a legal entity in Vietnam allows a foreign investor or cosmetic brand to gain full control over its operations. This route is more suitable for companies aiming for long-term investment and a strong local presence.

Advantages

• Full Operational Control: When you own a local company, you control all aspects of your business, including product registration, marketing, distribution, and pricing strategies.
• Increased Brand Credibility: Having a registered entity in Vietnam enhances your legitimacy and brand image in the eyes of local partners, retailers, and consumers.
• Direct Market Access: With your own company, it is easier to work directly with retailers, distributors, and e-commerce platforms, reducing reliance on third parties.
• Long-Term Business Development: A local presence lays the groundwork for expanding into related activities such as opening showrooms, hiring staff, and launching direct-to-consumer channels.

Disadvantages

• Higher Initial Investment: Setting up a company involves administrative expenses, office rental, professional fees, capital contributions, and licensing costs.
• Legal and Tax Complexity: Businesses must comply with ongoing corporate requirements such as tax declarations, labor laws, annual audits, and reporting obligations.
• Time-Consuming Setup: The incorporation process can take several weeks or even months depending on the nature of your operations and documentation.

2. Using a Cosmetic Notification Holder Service

An alternative to setting up a company is to appoint a licensed Vietnamese entity (Notification Holder) to handle product registration on your behalf. This service is commonly used by foreign cosmetic brands testing the market or operating without a local presence.

Advantages

• Faster Market Entry: You can begin registering and selling your products without waiting for company incorporation or obtaining operational licenses.
• Cost-Efficiency: You avoid initial investment costs such as office rental, company registration, tax reporting, and staff salaries.
• Regulatory Expertise: Notification Holders specialize in handling product dossiers and liaising with the Drug Administration of Vietnam (DAV), reducing the risk of errors or delays.
• Confidentiality: These services often help protect sensitive product formulations and business information, particularly useful during early-stage market exploration.

Disadvantages

• Limited Business Control: As the product registration is under the Notification Holder’s name, you rely on them for all updates, renewals, or changes to your product licenses.
• Dependence on Third-Party Operations: Any change in the relationship may disrupt your ability to import, sell, or adjust your product lineup.
• Potential Branding Concerns: Some retailers or distributors may be less willing to partner with a business lacking a legal local identity.

3. When Should You Register a Company?

Choosing to incorporate a company is ideal in the following scenarios:

• You plan to invest long-term in Vietnam’s cosmetic sector.
• You aim to build a strong brand presence and need control over product registration, marketing, and pricing.
• You want to collaborate directly with retail chains, salons, or establish a physical presence.
• Your goal includes employing local staff or opening your own distribution channels.

4. When Should You Choose a Notification Holder Service?

The Notification Holder model is more suitable if:

• You want to test the Vietnamese market before committing to long-term investment.
• You prefer to manage your business remotely and only focus on importing and selling products.
• Your company has a limited budget and wishes to avoid dealing with complex legal and tax procedures.
• You are looking for a quick and low-risk solution to begin operations in Vietnam.

Conclusion

Both company establishment and Cosmetic Notification Holder services are viable options for entering the Vietnamese cosmetic market, but they serve different business objectives. For companies aiming for complete market control, long-term growth, and strong brand identity, establishing a company is the most strategic choice. On the other hand, businesses seeking rapid entry and minimal setup obligations may find the Notification Holder model more practical and cost-effective.

At Green NRJ, we provide tailored solutions to support both options. Whether you want to launch a legal entity or simply register products through a Notification Holder, our team can ensure compliance, efficiency, and transparency throughout the process. Contact us today for a free consultation and discover how we can support your expansion into Vietnam’s dynamic cosmetic industry.

Related Articles

• How to Start a Business in Vietnam: A Complete Guide for 2025
• Comprehensive Guide to Cosmetic Registration in Vietnam
• How to Import and Sell Cosmetics in Vietnam
• Cosmetic Notification Holder – The Perfect Solution for Importing Cosmetics Without a Company in Vietnam