Japan is a potential market for Vietnamese garment and textile companies as it does not apply quotas on Vietnamese exports. However, technical and quality requirements are very high. To help Vietnamese firms penetrate deeply into this market, the Vietnamese Chamber of Commerce in Japan has provided vital information.
Market characteristics and import trends
Garments and textiles imported into Japan are classified into four groups: high-grade fashion products (fashionable in colours, designs, quality, models and normally imported from the EU and US); products from raw materials that are rare in Japan like Kashmir, Angola and mohair; labour-intensive products that are handmade items; and traditional handicraft products.
Currently, consumers in Japan tend to adopt cheap but high quality apparel from Asian countries, especially from China and ASEAN countries, thanks to their geographic proximity, cultural similarities, available materials, abundant workforce and competitive prices.
Vietnamese garment and textile products are holding competitive advantages over countries in the region and in the world. In 2006, Vietnamese garment and textile export to Japan was nearly JPY87.5 billion, representing an increase of 10.1 per cent against 2005 and holding 2.9 per cent of Japanese garment and textile import spending. As for knitwear, export revenues were JPY14.6 billion in 2006, up 8.5 per cent on year and retaining its fifth largest garment and textile exporter position in this market after China, Italy, South Korea and Thailand. But its market was only 1.2 per cent. From shuttled textile products, Vietnam earned JPY57 billion in 2003, increasing 11.2 per cent and accounting for 4.1 per cent of Japanese spending on this category, holding the third largest exporter of textiles to Japan after China and Japan.
Japanese market notes
In garment and textile products, Japan is a developing market. The price factor is not the decisive element for foreign exporters. More importantly, exporters and producers must have good reputation and prestige to have a significant market share. Products with high material quality, technical level and skilfulness will have competitive advantages. Therefore, Vietnamese exporters should take into account the following points:
- Delivery schedule: Exporters must pay attention to seasonal products and fashion products, especially companies in southern Vietnam where the climate conditions are different from Japan (with four different seasons). Hence, Vietnamese producers must meticulously calculate all logistics steps, from material collection and shipping, to avoid reaching the market out of season.
- Export batch size: Unlike the EU and US markets, export batches to Japan are normally small with diversified models. Exporters should take this point into consideration.
- Quality criteria: Many products certified in exporting nations fail to meet the demanding requirements in the Japanese market. The EU and US criteria focus on outer, not internal details and working skills. However, Japanese consumers always demand a perfect product. They take care of everything, including the smallest faults like tiny scratches, cracks and even natural defects.
In theory, there is no limit on the import of garments and textiles products into the Japanese market. In practice, exporters usually face difficulties penetrating this market from the demanding requirements for quality, and unfamiliarity with price, habits and tastes. To increase export turnover of garments and textiles to this market, Vietnamese companies must pay attention to improving models and designs, increasing quality, reducing unit price and especially developing material zones and supporting industries to raise the locally sourced component ratio in export products, to sharpen their competitive edge against Chinese products.