Vietnamese New Year (Tet) 2025: How to Prepare Your Business

December 16, 2024 Posted by Vietnam Briefing Written by Julia Goeb and Vu Nguyen Hanh Reading Time: 5 minutes

Vietnamese Lunar New Year, or Tet, is the most significant public holiday in Vietnam. As the longest holiday of the year, it sees a surge in travel activity, leading to the temporary closure of many businesses and the organization of various planned events and festivities. Vietnam Briefing offers a general overview of the Tet holiday, highlighting key aspects that businesses should anticipate and prepare for during this period.

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 10 consecutive work-free days.

The most important aspect of the Lunar New Year in Vietnam is the emphasis on 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.

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Tet is the Vietnamese version of the Lunar New Year celebrated in mainland China, Hong Kong, Taiwan and South Korea, but it is also influential in areas with major Chinese diasporas, such as Singapore.

The date of the festival is dictated by the Lunisolar calendar and can, therefore, fall anywhere between January 21 and February 20. The transition from the Year of the Dragon to the Year of the Snake will begin on January 30, 2025, though preparations usually begin after the Western New Year (January 1). In 2025, the holiday might start as early as Friday, January 24, 2025, and end as late as February 3, 2025, depending on each entity’s scheduling.

Though Tet shares the same origins as the Chinese Lunar New Year, it is celebrated with unique Vietnamese characteristics that distinguish it from other forms of the festival. 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 preparation for the Vietnamese Lunar New Year, families clean and decorate their homes to celebrate the Ong Cong Ong Tao (Kitchen Guardians’ Day) ceremony, observed on the 23rd day of the last lunar month. This period is traditionally marked by family gatherings, during which a feast is prepared to honor the three kitchen guardians and pray for abundance and prosperity in the kitchen for the coming 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 payment of bonuses: Advisory 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.

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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.

To compensate employees for working during this period, employers must provide overtime pay. Beyond cash rewards, businesses often offer Lunar New Year incentives in various forms. Many companies, for instance, provide train tickets to help employees return to their hometowns or give high-value items such as household appliances and motorbikes, which are commonly used in Vietnam.

Additionally, in the business context, it is customary to send gifts to key partners or clients, typically in the form of imported delicacies or wine. Gift hampers are particularly popular, often including a variety of items such as cookies, chocolates, fruit baskets, wine, soft drinks, and other treats.

This variety of gifts symbolizes wishes for a fruitful, prosperous, and successful new year. According to a 2020 report by Statista, the three most popular gifts for business partners in Vietnam were spirits, wine, and local delicacies.

This tradition may seem problematic to foreign businesspeople from Western countries, where gift-giving is often perceived as a form of bribery and is subject to strict compliance regulations. However, it is essential to recognize the cultural differences and communicate these nuances to overseas headquarters. Doing so fosters an understanding of local business customs and may necessitate exceptions to standard corporate policies.

Companies operating in Vietnam should be prepared to embrace these local practices during the festive season to strengthen relationships and align with cultural expectations.

Business closures over the Tet holiday

In 2025, although Tet falls on January 30, businesses and factories in Vietnam will remain closed for 7 to 9 days. This period includes the 5 days mandated by the Labor Code for the Tet holiday, along with an additional 2 to 4 days falling on the weekend.

Banks and schools will also be closed during this period. To avoid production delays and backlogs, which can build up 1 to 2 weeks before the holiday, factories should prioritize orders based on their importance and relationships with partners.

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Both manufacturers and buyers are advised to pay close attention to the ordering process. Early placement of orders by buyers can help minimize issues caused by rushed production before and after the Lunar New Year.

During the first week after the holiday, most businesses will begin reopening gradually and planning their production schedules, although some may take longer to resume full operations.

It is worth noting that millions of migrant workers in major cities return to their hometowns to celebrate the Lunar New Year with their families. This leads to crowded airports, bus terminals, and train stations in the lead-up to the holiday, as well as quieter, emptier streets in urban areas. Domestic travel surges during this time, particularly between Hanoi and Ho Chi Minh City.

Potential delays after the Vietnamese Lunar New Year

During the Lunar New Year period, Vietnamese ports and port warehouses close for the holiday, while terminals remain operational and open for incoming vessels. In the days leading up to the festival, ports work overtime to load all export cargo and unload import shipments before businesses close.

After the holiday, ports resume operations at full capacity but often face heavy congestion at the terminals. Businesses should anticipate delays caused by the week-long closure, with timelines in the North generally taking longer to normalize compared to the South. These delays may further compound supply chain disruptions.

Foreign businesses relying on supply chains in Vietnam are advised to maintain close communication with their suppliers, who may face labor shortages, and to coordinate shipments to minimize delays. It is important to note that it often takes time for businesses to fully resume normal operations after the holiday.

Holiday greetings

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 Snake in 2025!

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Vietnam Briefing is published by Asia Briefing, a subsidiary of Dezan Shira & Associates. We produce material for foreign investors throughout Asia, including ASEAN, China, and India. For editorial matters, contact us here and for a complimentary subscription to our products, please click here. For assistance with investments into Vietnam, please contact us at vietnam@dezshira.com or visit us at www.dezshira.com.

Dezan Shira & Associates assists foreign investors throughout Asia from offices across the world, including in Hanoi, Ho Chi Minh City, and Da Nang. We also maintain offices or have alliance partners assisting foreign investors in China, Hong Kong SAR, Dubai (UAE), Indonesia, Singapore, Philippines, Malaysia, Thailand, Bangladesh, Italy, Germany, the United States, and Australia.