The report finds that, to the extent that logistics operations in Vietnam are costlier than similar operations in other countries in the region, this is due to a persistent lack of reliability throughout the supply chain. When logistics costs are broken down by their component parts, it is apparent that Vietnam’s relative logistics underperformance does not originate from the transport costs side of the equation—particularly given the present overcapacity in many transport sectors, which tends to drive down transportation rates—but primarily from the ware- housing and inventory carrying costs side of the equation. The latter are directly dependent on supply chain reliability and predictability. As Vietnam seeks to compete in the world economy and trade in higher-value added goods under just-in-time production and time-definite local, regional, and intercontinental itineraries, improving reliability will become critical. This challenge can and should be seen as a key catalyst for reform.