VIETNAM TEXTILES AND CLOTHING INDUSTRY

VIETNAM TEXTILES AND CLOTHING INDUSTRY

Geographic location

• Geographic and transportation infrastructure• Area: 331,000 km2• Population: 93.6 millions peopleMajor cities’ areas (km2), population (1,000 people)

• Hanoi – HCMC highway 1,811km, 30 hours by train/car, 2.5 hours by airplane

• Vietnam – Germany: 9,323 km• Hanoi – Frankfurt: 4 non-stop flights per week, 12

hours• HCMC – Frankfurt: 3 non-stop flights per week, 12

hours

Hanoi HCMC Berlin Munich

Area 3,358 2,061 891 310

Population 7,420 8,444 3,748 1,456

Density 2,209 4,097 4,206 4,700

Cultural diversity

We

ste

rn &

Eas

tern

Traditional & Modern

Old & New

Young population & high economic growth

5.000 4.000 3.000 2.000 1.000 0 1.000 2.000 3.000 4.000 5.000

0-4

5-9

10-14

15-19

20-24

25-29

30-34

35-39

40-44

45-49

50-54

55-59

60-64

65-69

70-74

75-79

80+

Vietnam, 2018

Male Female

A strong textiles and clothing sector

Facts and figures:- Export 30.4 bil. USD of textiles and

clothing (2018)- Rank 3rd after China and Bangladesh in

clothing export- Key export products (>1 bil. USD): men

and women suits (woven and knitting), cardigans, T-shirts, men and women overcoats

- No. of establishments: 3,518 textiles & 6,961 clothing, locating across the country

- No. of employees: 283,986 in textile & 1,467,767 in clothing

- Hai Phong and HCMC seaports are two main gateways for textiles and clothing trading

Ha Dong Silk Village, 13th

century (Ha Noi)

Ma Chau Silk Village, 16th

century (Hoi An)

Van GiaoBrocade Village, (An Giang)

A global integrated economy

• 13 FTAs signed (EVFTA is under ratifying process)• 3 more are in negotiating progress

Main export products and destinations

- 500 1.000 1.500 2.000 2.500 3.000 3.500

Jerseys

Women's suits

Men's suits

Women's suits

T-shirts

Men's overcoats

Women's overcoats

Men's shirts

Women's blouses

Garments made up of felt or…

Top 10 export products, bil. USD

- 2.000 4.000 6.000 8.000 10.000 12.000 14.000

USA

EU

Japan

Korea

China

Taiwan

Hong Kong

Australia

Russia

Chile

Mexico

Top 10 destinations, bil. USD

VN-EU trading in textiles and clothing

'620411%

'620310%

'620210%

'62018%

'61096%'6210

6%

'61045%

'61105%

'62124%

'63074%

Others31%

Top 10 export products to EU

Germany20%

UK18%

Netherlands15%

France13%

Spain11%

Italy6%

Belgium5%

Export to EU by countries

VN textiles and clothing value chain

Design, Fashion

Materials

CMT

Branding, Marketing, Distribution

OEM (FOB)

VN Int’l Fashion Weeks annually organized in HCMC and HanoiThe 10th VIFW will be in Oct., 2019

Highly rely on imported materialsNew wave of investment in textiles (CleanDye, Torei, etc.)

65-70% of local firms

ODM: < 5% of local firmsOBM: < 5% of local firms

Large firms, SOE-origin

Local market oriented

Export oriented

2018 production:- 2,8 mil. tons of yarn- 1,9 bil. m2 of fabric

2018 production: 5,2 mil. pieces of clothing

20-25% of local firms

Advantages

• A strategic location of the country

• A favorable cultural, economical environment

• An attractive quality-price ratio, especially for high added-value, sophisticated items

• A highly skilled and versatile workforce, a collaborative and flexible working style

• Sustainability is integrated in the companies’ development strategy

• Growing offer of qualitative and affordable locally manufactured fabrics

• Skillful import/export logistic solutions

• An alternative solution to the Chinese clothing export

Challenges

• Availability of market and buyers intelligence

• Availability of locally made, good quality fabrics

• The local firms’ managerial skills and supply chain management

• The roles and efficiency of the government and BSOs

• The capacity of local technical institutions

• The language and communication skills (English)

• The progressive digitalization

Sourcing cost

Source: 2018 Fashion Industry Benchmark Study, US Fashion Industry Association

Note: The results were based on respondents’ average rating for each country in a scale of 1 (much lower performance than the average) to 5 (much higher performance than the average). In the table, means strength as a sourcing base (rating score between 4.0-5.0), means average performance (rating score between 3.0-3.9), means weakness as a sourcing base (rating score between 1.0-2.9).

Company sharing- Viet Sun

1. Quality and diversity of the company’s client portfolio- trust building

with buyers

2. Key strategy:

• Industrial and modern set-up

• Investment in product development

• Strict control of the supply chain for sustainability

3. Few words about the factories & the management’s vision

Façade lifting to be invigorating and improve aesthetics and functionality

Signature Collection Development by design team

… and mentored by expatriate designers

Eco-friendly Certification in the present production facilities

…. and LEED/Lotus standards to be applied to the new production expansion project to be kick started in Central Vietnam by the end of this year

Company sharing- Viet Sun

1. Quality and diversity of the company’s client portfolio- trust building

with buyers

2. Key strategy:

• Industrial and modern set-up

• Investment in product development

• Strict control of the supply chain for sustainability

3. Few words about the factories & the management’s vision

A portmanteau word of Vietnam and the Sun –VIETSUN in a hope that the shine and warmth of the

sun of Vietnam are taken to the world

Apparel company of sustainable growth in Vietnam and in the region

TrustInnovationPassionSustainability

Company sharing- HA Fashion

1. High-end Women garments with the strategy of Quality & Flexibility• Natural fabric (silk and linen)

• Strict quality control, diversity

• Flexibility

2. Special machines and Quality Control

3. About the company

Thank you!Trân trọng cảm ơn!

Cục Công nghiệp, Bộ Công ThươngVietnam Industry Agency (VIA)

23 Ngô Quyền, Hoàn Kiếm, Hà Nội

Tel.: 024.3.996.7189 Fax: 024. 3.823.8387

Email: via@moit.gov.vn

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