Da Nang Huu Nghi Co. is one of the typically successful enterprises established and during the subsidy period in the central city of Danang. The company, which used to be a small-scale enterprise with outdated equipment, has made great progress thanks to its keenness in renewing technologies as well as new management lines.
Da Nang Huu Nghi Co., set up in October 1992, specialised in apparel production and business. In 1994, the company shifted its scope into canvas shoe and sports shoe production. Not long after its establishment, the company like many other garment and textile firms lost traditional major markets resulting from the collapse of the Eastern European socialist bloc and former
The company had to compete fiercely with both local and foreign rivals for survival and to create jobs for its idling workers.
According to General Director Nguyen Luong Dinh, in such a situation, one of the most vital tasks of his company was to renovate technologies and improve product quality.
Therefore, the company has invested more and more money in renewing technologies and equipment. Investment normally surpasses that of the previous year. Da Nang Huu Nghi Co. has bought five new shoe production lines with a combined investment capital of VND47 billion (US$2.99 million) since its establishment, bringing the total annual capacity to 2.5 million pairs of shoes.
In addition, the company has also invested in utilities projects like equipping vacuum cleaners and air filters to provide better working conditions and environment for its staff. It has also kitted out computers and applied new software programmes to boost production and quicken management tasks as well as receiving and processing information.
Being aware of the importance of management over production and business efficiency, Da Nang Huu Nghi Co. chose ISO 9001 management criteria as its benchmark and, as of May 2001, the ISO 9001 criteria has been applied throughout the company. The company has also applied European standards.
In 2002, the company continued to shift into outsourcing canvas shoes and sports shoes. But later, it directly signed contracts with its customers. It also began to use more locally sourced materials like soles, canvas and leathers, thus reducing import costs.
Currently, Da Nang Huu Nghi Co. is considered a symbol of success in the market economy mechanism. According to Mr. Dinh, the average annual growth of the company is currently between 12 and 17 per cent. Remarkably, the company made 2.4 million pairs of shoes in 2004, recording proceeds of VND278 billion (US$17.7 million) and export revenues of US$17.6 million.
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