What causes many businesses to dissolve or suspend operations?

In the first 3 months of 2025, the whole province had 104 dissolved enterprises and 733 enterprises
temporarily suspended (illustrative photo)

Many businesses withdraw from the market

Dai Hung Import-Export and Manufacturing Machinery Company Limited in Binh Giang District specializes in manufacturing and trading machine tools and metal forming machines. After just over a month, in early April 2025, the company completed procedures to dissolve the enterprise and cease operations.

At the end of March 2025, MTP Technical Investment Joint Stock Company, registered in Ngoc Chau Ward, Hai Duong City, officially ceased operations less than 6 months after the Department of Finance first issued its business registration.

Both of the above enterprises have low charter capital, under 10 billion VND. The reason for dissolution and termination of operations was given by the enterprises due to not finding opportunities in the field they are operating in. Difficulty in finding customers. Production and business activities are not as effective as expected...

The headquarters of MTP Technical Investment Joint Stock Company on Le Viet Quang Street (Hai Duong City) has officially ceased operations since the end of March 2025.

A representative of a business operating in the field of trade and services in Hai Duong City said that this business is also completing procedures to temporarily suspend operations. The reason is that market fluctuations have affected the business's operations. "Our business was originally a sole proprietorship. After nearly 3 years of operating under the business model, we were forced to temporarily suspend operations because we were not fully prepared to adapt and respond flexibly to the market. The foundation of business administration, human resources, capital, etc. are all lacking, forcing us to make this difficult decision. In the coming time, the business will restructure and return at the right time," the representative of this business shared.

According to the Hai Duong Department of Finance, in the first quarter of 2025, the province had 457 newly established enterprises (up 18.4% over the same period last year), with a total registered capital of more than 30,500 billion VND. During the same period, the province had 104 dissolved enterprises (up 55.2%); 733 enterprises temporarily suspended operations (up 16%).

On average, each month, about 245 businesses temporarily suspend operations and 35 businesses dissolve. Businesses that complete dissolution procedures and temporarily suspend operations are mainly concentrated in the fields of trade, services, auto and motorbike repair, processing and manufacturing industries, construction, science and technology, consulting services, design, advertising, accommodation, food and beverage, transportation, warehousing, etc.

While many businesses are dissolved or temporarily suspended, many businesses are established, put into operation, developing production and stable business, creating jobs and income for workers.

A representative of the Business Registration Office, Department of Finance, said that the number of businesses in the province withdrawing from the market mainly registered to temporarily suspend operations for a short period of 6 months to 1 year. The reasons were ineffective business operations, difficulties in finding customers, poor finances, and lack of investment capital.

In addition to the internal causes of the business, there are also some other external causes such as the consequences of the Covid-19 pandemic that have had a negative impact on many businesses. Many businesses, after a long period of "holding on", could not continue to operate and were forced to dissolve and withdraw from the market. In addition, the US tariff policy, conflicts in Europe, the Middle East... have made production and business activities of businesses difficult.

Mr. Nguyen Trac Thang, Chairman of the Provincial Association of Small and Medium Enterprises, said that the vast majority of small and medium enterprises when newly established have very small capital, many enterprises only from a few billion VND. These are also enterprises that are easily affected by the market, policies, natural disasters, epidemics, etc. Most of these enterprises lack management and operation capacity, lack capital, and have outdated technology, so after a period of operation, they are not able to adapt, leading to dissolution and temporary suspension of operations. In recent years, many member enterprises of the association have dissolved or temporarily suspended operations due to market fluctuations, production and business activities are not as expected. Many enterprises are in a situation of large inventories, tax debts, etc.

Need practical solutions to support businesses

Strengthening support activities, investment promotion, supporting businesses to consolidate traditional markets, expanding new export markets is one of the solutions to limit business dissolution and cessation of operations. In the photo: Members of the Provincial Business Association exchange experiences, promote products among members

The representative of the provincial Statistics Office said that the world and regional economy continues to be complicated, especially the recent US tariff policy. Many key export industries of the province are affected such as textiles, garments, footwear, electronics, etc.

To limit the number of dissolved and inactive enterprises and strive to achieve the highest target of registering new enterprises in 2025, the representative of the Business Registration Office, Department of Finance said that it is necessary to continue to promote administrative procedure reform, reduce administrative procedure compliance costs for enterprises, further shorten the time for enterprises to enter the market, especially the issuance of business licenses for conditional business lines and occupations.

Simplify lending processes and procedures, create conditions for businesses to access capital, especially preferential capital sources. Support land rent, taxes, and fees for businesses affected by US tariff policies, geopolitical conflicts, etc.

Strengthening support and investment promotion activities, assisting businesses in consolidating traditional markets and expanding new export markets. Supporting businesses in accessing and applying green transformation models, sustainable business...

TRUONG HA

Source: https://baohaiduong.vn/dieu-gi-khien-nhieu-doanh-nghiep-giai-the-tam-dung-hoat-dong-409537.html