On February 20, the USAID Linkages for Small and Medium Enterprises (LinkSME) project conducted pre-evaluation visits to two Vietnamese SMEs in Ho Chi Minh City. Both of these companies manufacture high-precision machining parts used in metal grinding, drilling, etc. The visits covered the first stage in a two-stage supplier evaluation process. This first stage was a pre-evaluation to assess the SME’s capabilities and potential prior to introducing them to two of USAID LinkSME’s foreign firm partners with operations in Vietnam: Penflex, a manufacturer of flexible metal hoses, and RCH, an Italian company that provides solutions for overall store management.  USAID LinkSME used a technical scorecard to grade the SMEs based on documentation, observation, and interviews. If the SMEs pass the first stage and are chosen by the foreign firm partners as potential suppliers, USAID LinkSME will conduct a second, deeper evaluation to develop a plan aimed at helping the SMEs meet the foreign firms’ requirements. Apart from evaluating these SMEs’ potential, the USAID LinkSME team is also concurrently refining and improving its linkage process to be more effective and efficient.

So What? USAID LinkSME aims to improve the business environment by lowering costs for multinationals located in Vietnam to source locally while representing a huge opportunity to increase regional competition and grow Vietnam’s SME sector and build its middle class, major consumers of American products.