Bountiful Orders for Vietnam Garment and Textile

According to the Vietnam Textile and Apparel Association (VITAS), the Vietnamese garment and textile industry earned more than US$6.7 billion from exports in the year to end-September. To realise the revised target of three % growth this year, or US$9.3 billion in total, the sector targets to earn over US$800 million a month in the last three months of the year.

 

“Most big companies have contracts enough for operations until the end of the year. All are accelerating production. The target of US$9.3 billion is a distance dream for any insiders on the back of economic crisis but it is likely within reach,” said Nguyen Thi Hong Tin, Director of Vinatex Market Research and Promotion Committee.

 

According to the Vietnam National Textile and Garment Group (Vinatex), many garment and textile companies like Viet Tien, Phong Phu, Saigon 2 and Garment 10 are working with many foreign customers. They refuse many contracts as they want to select better orders as their current contracts have ensured enough work for the whole year.

 

Mr Than Duc Viet, Managing Director of Garment 10 Company, said: With many orders at a time, his company had to weigh up and down new orders carefully, especially price and future potentiality.

 

According to Mr Viet, for months, his company has no inactive workshops or laid-off workers. All members are accelerating to complete and even beat the full-year target.

 

At Dong Xuan Knitting Company, although existing orders have reportedly been enough for production until the end of the year, following the enactment of the Vietnam - Japan Economic Partnership Agreement from October 1, 2009, the number of orders from Japanese partners surged, especially for high-grade underwear. Thus, the company has expanded production scales to receive new orders and keep customers.

 

According to Ms Nguyen Thi Hong Tin, many companies have accepted orders and outsourced other companies to fulfil.

 

Vinatas pointed out that the increasing number of orders comes from world-leading fashion companies and major apparel importers like the US, the EU, Japan and South Korea. Previously, they placed more orders in China, India and Bangladesh but now they tend to shift their orders to Vietnam.

 

Apart from traditional markets, new markets like South America, Africa and the Middle East are also sending more orders to Vietnam.

 

Like leaders of other garment and textile companies, Mr Than Duc Viet forecast that the export market will be more positive in 2010. The Garment 10 Company has won orders that ensure enough work for the company until the end of the first quarter of 2010. Viet Tien Corp even has orders for full operations until May or June and the company is expanding its production facilities to Laos and Cambodia.

 

With more orders, many companies like Nha Be and Phuong Dong are expanding their production operations to the central region. Other large-sized concerns like Viet Tien, Phong Phu, Saigon 2 and Garment 10 also have revealed plans to expand production, enhance productivity and increase added value to receive more new orders. Although the garment and textile export is predicted to be stiffly competed by strong exporters like Vietnam, China, India and Bangladesh, Vietnamese exporters said they will step up the development of strategic and advantageous projects. For instance, X20 Joint Stock Company will export motor-racing suits while Viet Tien will focus on shirts and suits.

 

However, the hardest difficulty is the shortage of material. As Vietnamese companies have to import fabrics, many orders failed to complete on time. Thus, if garment and textile companies have immediate locally-sourced materials, they can complete their orders sooner and thus attract more customers.

 

Although global markets are very good from now to the end of this year and 2010, Vietnamese garment and textile companies will still focus on expanding the domestic presence.

 

In fact, the domestic demand for apparel products since the start of the year remains high. By the end of September, domestic sales of apparel products climbed 23 % from the same period of 2008. Strong growth in the crisis time has proven the huge demand in the domestic market which was previously ignored by most garment and textile firms.

 

Garment 10 Company has revealed its domestic expansion plan. Accordingly, the garment producer will invest in building fashion shops to distribute its products to Vietnamese consumers.

 

Director Than Duc Viet said his company is investing for researching models, materials, categories and prices to meet diversified tastes of Vietnamese consumers. Target customers of the company are white-collar and blue-collar workers.