In the current market economy with fierce competition, the number of newly established businesses is increasing, but the number of businesses that are unprofitable or have low profit also accounts for a large proportion. Accordingly, one of the main reasons for low operational efficiency is an outdated management method and low-cost efficiency. Previous studies on cost management focused primarily on traditional cost methods. Different from previous studies, this study explores the relationship between the application of the cost-based method (ABC costing-method) and the improvement of business performance in manufacturing firms in Ho Chi Minh City. The authors conducted quantitative research by analyzing the Structural equation modeling (SEM) with AMOS - SPSS with secondary data collected from the survey of managers of 620 firms. The research results show that if businesses make good use of the ABC costing-method, their business performance will be significantly improved.

The study has surveyed 285 manufacturing enterprises in central Vietnam as a representative sample, through which the research has analyzed the current status of operation of manufacturing enterprises in Central Vietnam. The research results also pointed out 5 factors: (1) Labor; (2) Enterprise size; (3) Financial management capacity (4) Capital structure and (5) System of policies and legislation in descending order of affecting the performance of enterprises through regression model. Besides, the study has given specific policy suggestions through the current situation and research model to improve business performance for manufacturing enterprises in Central Vietnam in the future.