This paper examines the factors contributing to the growth of SMEs by using a conceptual framework derived from the concept of resource; cluster; networking; and institutional theories. The Vietnamese experience suggests that institutional weakness and lack of proper coordination between policy making and implementation has made the support regime ineffective. Most importantly, the effectiveness of government support policies can be analysed by the principle of resource theory. The findings indicate that Vietnamese government has mainly focused on increasing the number of SMEs rather than improving the performance of SMEs and strengthening the business’ competitiveness. This paper suggests that the clustering and networking approaches, as well as institutional reform may be the key success factors for overcoming the SME resource constraints in Vietnam.