Connecting supporting industries to the global supply chain

VCN - Enterprises supporting industry effectively connecting to form chains and clusters of parts will help increase opportunities to participate deeply in the global supply chain.
Increasing export volume thanks to cross-border e-commerce Increasing export volume thanks to cross-border e-commerce
Find a way to join global supply chain for supporting industry enterprises Find a way to join global supply chain for supporting industry enterprises
Hanoi supporting industry moves to join global supply chains Hanoi supporting industry moves to join global supply chains
The linkage of enterprises will form chains, produce parts with higher added value, and easily participate in supply chains. Photo: N.H
The linkage of enterprises will form chains, produce parts with higher added value, and easily participate in supply chains. Photo: N.H

Meeting point for manufacturers and suppliers

Participating in a conference on the Sourcing Fair Supporting Industries 2023 (SFS 2023) last weekend, Mr. Kazutomi Miura, Chief Representative, Takara Industry Company Representative Office in Ho Chi Minh City, expected to find more mechanical processing and laminating products suppliers. Previously, since 2015, the company has connected with 3 supporting industry suppliers in Vietnam, providing aluminium casting, laminating and mechanical products. Mr. Kazutomi Miura assessed that Vietnam's supporting industrial products had good quality, met the company's strict standards, and had a very good price.

In fact, through 6 times of organization, SFS has become a meeting point for Vietnamese supporting industrial enterprises to find output and a place for FDI enterprises and end-to-end manufacturing enterprises to connect with domestic suppliers to diversify supply in the future.

Mr. Tran Ba Linh, Production Director of Dien Quang High Technology Company Limited, assessed that SFS was a very effective connection channel for enterprises by gathering many industrial manufacturers and supporting industrial enterprises. Because without this event, the company would waste a lot of time and money finding and meeting potential suppliers. Accordingly, during the 2022 event, Dien Quang connected 10 suppliers and one buyer in Europe. Accordingly, Dien Quang also hoped to expand its list of suppliers and customers this year.

Ms. Sabrina Anh Tran, Purchasing Director of Techtronic Industries (TTI) Vietnam Company, also said that the company was looking for suppliers for metal components, lathing and milling, metal stamping, shape casting, engine parts... to prepare for production expansion.

Connection to improve capacity

Although Vietnamese supporting industrial enterprises are participating in the supply chains of global enterprises, in general, the lack of connection is still a weakness in reaching customers. Ms. Truong Thi Thu Tram, Deputy General Director of Minh Man Printing Co., Ltd., said that the supply capacity of Vietnamese supporting industrial enterprises in the global supply chain was not a worrying problem. However, enterprises still lacked the connection to form multi-component chains and part-clusters to meet new order trends for foreign enterprises.

Ms. Tram cited that when Hoa Phat Group first started planning to invest in a container shell production project, foreign enterprises proactively approached and offered solutions to provide a complete package of raw materials for finished production. Accordingly, metal supply enterprises cooperate with paint, label, and printing enterprises when approaching Hoa Phat. This created a huge advantage compared to a single approach for Vietnamese enterprises.

Ms. Sabrina Anh Tran also pointed out that foreign enterprises currently tend to shorten production processes and reduce product tolerances, so they prioritize choosing multi-detailed products. Therefore, domestic enterprises needed a connection to improve their supply capacity. It was necessary to establish a corresponding multi-detailed supply chain of supporting industrial products for level 1 and 2 suppliers. This would help enterprises improve their competitiveness, maintain orders, and penetrate deeper into the global supply chain.

Mr. Kazutomi Miura also said that the company's wish was that Vietnamese enterprises could complete the assembly stage, but currently, the 3 Vietnamese suppliers for Takara only stopped providing raw materials due to limited capacity.

Recognizing the above reality, the Vietnam Association of Supporting Industries (VASI) proposed the "learn together, buy together, sell together" solution for its members. This solution brought results when VASI in the Northern region successfully connected a "sell together" project to an FDI enterprise. Specifically, enterprises in each block, shape block, plastic block, and mechanical block work together to create finished products, send customer quotes, and have them accepted.

However, Mr. Duong Huu Phuc, a member of the VASI Executive Committee, said that implementing this solution also faced many difficulties due to the unequal capacity of enterprises, not enough orders for all of them and lack of understanding among enterprises when working together. In addition, the currently incomplete supply chain connection was also a major barrier. For example, at VASI in the Southern region, connections such as plating, heat treatment, and casting were currently lacking. In addition, investment members did not have an orientation or deep specialization.

To overcome these problems, VASI is offering solutions such as increased support, training, exchange and sharing to make the more uniform capacity of enterprises. All members work together to get many new orders and orders for the project team.

Approaching manufacturers' confidence is also one of the weaknesses of Vietnamese enterprises. Ms. Le Nguyen Duy Oanh, Deputy Director of Ho Chi Minh City Supporting Industry Development Centre, said that many enterprises previously had not met the criteria for purchasing, but after 2-3 years, they had innovated and participated in some supply chains. However, they were not confident to offer again to buyers they had contacted.

By Nguyen Hien / Binh Minh

Related News

Expand investigation for two smuggling cases

Expand investigation for two smuggling cases

VCN – The Anti-Smuggling and Investigation Department under the General Department of Vietnam Customs has prosecuted 55 illegal imported shipments of used machinery, equipment, and technological lines.

Latest News

Vietnam earns 1.43 billion USD from rice exports in Q1

Vietnam earns 1.43 billion USD from rice exports in Q1

Vietnam in the first quarter of 2024 exported 2.18 million tonnes of rice, earning 1.43 billion USD, an increase of 17.6% in volume and 45.5% in value year on year. Meanwhile, the average export rice price also increased by 23.6% to $653.9 per tonne.
Localities get ready for fourth FDI boom

Localities get ready for fourth FDI boom

As the year 2024 is expected to witness the start of the fourth wave of foreign direct investment (FDI) to Vietnam, localities nationwide are getting ready to absorb foreign capital flows.
Opportunities to develop a smart and sustainable packaging industry

Opportunities to develop a smart and sustainable packaging industry

VCN - The concept of circular economy and sustainability requirements are increasingly influencing packaging design. In particular, highly recyclable packaging is gradually becoming an important part of the packaging process in the food and beverage industry. This is also one of the key factors promoting the development of Vietnam's packaging industry.
Domestic retailers eye export-quality products

Domestic retailers eye export-quality products

Domestic retailers are increasing the distribution of export-quality products to cash in on the consumption trend towards green, environmentally friendly and safe products.

More News

Textile and garment exports recovered positively

Textile and garment exports recovered positively

VCN - Vu Duc Giang, Chairman of Vietnam Textile & Apparel Association shared with Customs News about the production and export situation of Vietnam's textile and garment industry after many difficult periods.
Launch of FDI Annual Report 2023

Launch of FDI Annual Report 2023

VCN - In 2023, industrial parks and economic zones kept attracting foreign investors with 27.7 billion USD of FDI capital investment; the number of new investment projects, adjusted investment capital and implemented FDI capital all increased compared to the previous year.
Vietnam has opportunities to attract, develop the offshoring market

Vietnam has opportunities to attract, develop the offshoring market

Vietnam is an attractive choice for businesses who are looking for outsource solutions, given its affordable workforce, highly skilled human resources and the constantly developing infrastructure of information technology and the telecommunications industry, said real estate consultancy firm Knight Frank in its report Asia-Pacific Horizon: Harnessing the Potential of Offshoring.
Nearly 600 million USD disbursed in support of agroforestry, aquatic sectors

Nearly 600 million USD disbursed in support of agroforestry, aquatic sectors

More than 15 trillion VND (597 million USD) has been disbursed under a credit scheme to support Vietnamese agroforestry and aquatic sectors since July last year, heard participants at a recent conference to discuss measures on maintaining Vietnam's key agricultural exports.
Be proactive and flexible with production materials

Be proactive and flexible with production materials

VCN - Enterprises' production and export orders have gradually returned, leading to many recovery prospects. Therefore, the issue of raw materials for production continues to be a major concern to meet rules of origin requirements.
Cooperate to build leading and "rich in vitality" state-owned enterprises

Cooperate to build leading and "rich in vitality" state-owned enterprises

VCN - In Vietnam, the contribution ratio of state-owned enterprises (SOEs) to GDP is approximately 30% but their competitiveness is not commensurate with the resources they hold, and many SOEs operate ineffectively.
Garment & textile sector tries to keep growth momentum

Garment & textile sector tries to keep growth momentum

The Vietnamese garment and textile sector is carrying out various measures to bolster production and business activities amidst formidable challenges posed by falling demand, high inventory, and geopolitical instability in several countries, according to insiders.
Businesses capitalize on recovery momentum to explore market expansion

Businesses capitalize on recovery momentum to explore market expansion

VCN - Since the start of the year, Vietnam’s exports have welcomed positive signals as orders from several key sectors have noticeably rebounded. Enterprises are capitalizing on the market recovery to bolster their export drive.
Access to the Chinese market is increasingly convenient

Access to the Chinese market is increasingly convenient

VCN - As Vice Chairman of the High Quality Vietnamese Goods Business Association, Mr. Nguyen Lam Vien (photo) is also Chairman of the Board of Directors of Vinamit Joint Stock Company - a very successful enterprise in the Chinese market, shared with Customs News many interesting information and advice for businesses to achieve success in this potential billion-people market.
Read More

Your care

Latest Most read
Vietnam earns 1.43 billion USD from rice exports in Q1

Vietnam earns 1.43 billion USD from rice exports in Q1

Vietnam in the first quarter of 2024 exported 2.18 million tonnes of rice, earning 1.43 billion USD, an increase of 17.6% in volume and 45.5% in value year on year. Meanwhile, the average export rice price also increased by 23.6% to $653.9 per tonne.
Localities get ready for fourth FDI boom

Localities get ready for fourth FDI boom

As the year 2024 is expected to witness the start of the fourth wave of foreign direct investment (FDI) to Vietnam, localities nationwide are getting ready to absorb foreign capital flows.
Opportunities to develop a smart and sustainable packaging industry

Opportunities to develop a smart and sustainable packaging industry

VCN - The concept of circular economy and sustainability requirements are increasingly influencing packaging design. In particular, highly recyclable packaging is gradually becoming an important part of the packaging process in the food and beverage indus
Domestic retailers eye export-quality products

Domestic retailers eye export-quality products

Domestic retailers are increasing the distribution of export-quality products to cash in on the consumption trend towards green, environmentally friendly and safe products.
Textile and garment exports recovered positively

Textile and garment exports recovered positively

Vu Duc Giang, Chairman of Vietnam Textile & Apparel Association shared with Customs News about the production and export situation of Vietnam's textile and garment industry
Mobile Version