Vietnamese New Year 2024: How to Prepare Your Business
This article was originally published in December 2021. It was updated December 27 2023 to reflect the most recent, relevant information.
- Vietnamese Lunar New Year, or Tet, is the most important public holiday in the country.
- The longest holiday of the year marks a time of increased travel resulting in the closure of businesses, with planned events, and festivities during the holiday period.
- Vietnam Briefing provides a general overview of the New Year Holiday including what businesses should expect and be aware of.
Vietnamese Lunar New Year (Tet or Tet Nguyen Dan in Vietnamese) is the most important traditional holiday in Vietnam. It is also the longest public holiday in the country with up to ten consecutive work-free days.
The most important aspect of the Lunar New Year in Vietnam is the emphasis on the old traditions and time with family. For most Vietnamese, visiting their parents over the holidays is crucial; weeks before the holiday, flight and train ticket prices sharply increase, as people leave the major hubs of Hanoi, Ho Chi Minh City, and Da Nang and head to their hometowns.
Tet is the Vietnamese version of the Lunar New Year in mainland China, Hong Kong, and Taiwan but is also influential in areas with major Chinese diasporas, such as Singapore. Several other Asian countries, including South Korea and Vietnam, celebrate their own lunar new year holidays as well.
The date of the festival is dictated by the Lunisolar calendar and can therefore fall anywhere between January 21 and February 20. This year, the transition from the Year of the Cat to the Year of the Dragon will begin on February 10, though preparations usually begin after the western new year. In 2024, the holiday will be from Thursday, February 8, 2024 to Wednesday, February 14, 2024.
Though Tet shares the same origins with the Chinese New Year, it is celebrated with unique Vietnamese characteristics that distinguish it from forms of the festival anywhere else. One example is the preparation and consumption of distinctive traditional foods with their own symbolic value (glutinous rice cake, braised pork dishes, pickled vegetables, and candied fruits among many others).
In celebration of the Vietnamese Lunar New Year, families will be cleaning and decorating their houses to prepare for the Ong Cong Ong Tao (Kitchen Guardians’ Day) ceremony on the 23rd day of the last month of the lunar year. This is usually the time of the year for family gatherings as families will prepare a feast to worship the three kitchen guardians and ask for a full kitchen for the rest of the year.
Red envelopes, or ‘Li Xi’ in Vietnamese, are commonly given to children, younger colleagues, and support staff during the Lunar New Year Period. The significance of these red packets is the red envelopes themselves, which are seen to symbolize energy, happiness, and good luck. Therefore, when a red envelope is given, this is seen as sending good wishes, happiness, and luck to the receiver.
Tet traditions and bonuses for businesses in Vietnam
One aspect business owners and foreign employers should be aware of is the custom of paying a Tet bonus to each staff member, which can be as much as a monthly salary or more.
Despite the bonus not being a legal obligation, it can facilitate employee satisfaction and retention. More than a few foreign employers have seen their valued staff leave after the holidays due to the lack of a Tet bonus. Considering that the Lunar New Year is the high season for recruiting and job change, the bonus should be used to both motivate and retain employees.
Without an obligated rate, it should be determined based on business results and the employees’ work performance. Though employees are entitled to a holiday break, some businesses might require or offer them to work during this time depending on the nature of the work or special requirements. This is more frequent for foreign businesses than local counterparts.
However, to do this, employers must pay them penalty rates. In addition to cash, enterprises can reward employees in other forms. In fact, many businesses give Lunar New Year incentives to employees in the form of train tickets to return to their hometowns as well as expensive objects such as household appliances and motorbikes (which are ubiquitous to Vietnam).
Besides that, especially in business, it is customary to send gifts (normally imported delicacies or wine) to top partners or clients. Usually, people prefer buying gift hampers that include different kinds of food such as cookies, chocolates, fruit baskets, wine, soft drinks, and other treats.
This variety is intended to symbolize the wishes for a fruitful, prosperous, and successful new year. In 2020, according to a report from Statista, the three most popular gifts for business partners were spirits, wine, and local delicacies.
This tradition might appear problematic to foreign businesspeople from western countries, as giving gifts is often seen as a form of bribery and is highly regulated in various compliance regulations. However, the difference in custom and culture is worth considering and should be communicated to headquarters overseas in order to create an understanding of the local business culture that may require exceptions.
Any company doing business in Vietnam should be prepared to adopt local practices over this festive period.
Business closures over the Tet holiday
Even though in 2024, Tet falls on February 10, businesses and factories in Vietnam will be closed for seven days. This includes five days promulgated by the Labor Code for the Tet holiday and the other two on the weekend for the 2024 Lunar New Year.
See also: Vietnam’s Public Holidays 2024
Banks and schools will also be closed during this time. To avoid delayed production and backlogs that can culminate up to one to two weeks before the holiday, factories should process orders according to their priorities and partner relationships.
It is advised that both manufacturers and buyers pay utmost attention to the ordering process. If the buyers place their orders early, problems with rushed production before and after the new year can be minimized.
Within the first week after the holiday, most businesses will slowly start reopening and planning their production, however, others might take longer to get ready for full operations.
Note: Usually, millions of migrant workers in major cities will return to their hometowns to celebrate Lunar New Year with their families. This results in crowded airports, and bus and train stations prior to the holiday and quieter and emptier streets in the cities. Domestic travel usually booms, especially between Hanoi and Ho Chi Minh City.
Potential delays after Vietnamese Lunar New Year
During the Lunar New Year period, the Vietnamese ports and port warehouses will be closed while the terminals continue to work full-time and are open for incoming vessels. The days before the festival, the ports work overtime and try to load all export cargo to unload all import shipments in time before the business closure.
After the holiday, the ports will be back to full capacity when they resume work. However, they may have to deal with heavy congestion at the terminals. Businesses should expect delays created by the week-long closure. It usually takes longer in the North than in the South for the timelines to get back to normal. This may further add to supply chain delays.
Foreign businesses with supply chains in Vietnam are advised to stay in touch with their suppliers who may face labor shortages and ensure that products can be shipped on time. After the festival it often takes some time for business to fully return to normal.
The traditional greeting to wish your clients a happy new year is “Chuc Mung Nam Moi”. It is customary to at least send a physical card or e-card to partner offices if the partnership does not require a gift.
In this spirit, the Dezan Shira & Associates Vietnam team wishes you a prosperous, successful, and healthy New Year of the Dragon!
Vietnam Briefing is produced by Dezan Shira & Associates. The firm assists foreign investors throughout Asia from offices across the world, including in Hanoi, Ho Chi Minh City, and Da Nang. Readers may write to email@example.com for more support on doing business in Vietnam.
We also maintain offices or have alliance partners assisting foreign investors in Indonesia, India, Singapore, The Philippines, Malaysia, Thailand, Italy, Germany, and the United States, in addition to practices in Bangladesh and Russia.
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