Vietnamese textiles, garments and furniture benefit from many breakthrough advantages in the global market

VCN - Greening the production chain, improving productivity, product quality, shifting to high-quality segments and higher added value... are being carried out by enterprises in the wood, furniture, textiles and garments, thereby bringing competitive advantages in the international market.
Vietnamese-designed furniture products make their mark at the Milan Design fair
Vietnamese-designed furniture products make their mark at the Milan Design fair

Regain growth momentum

Ms. Duong Thi Minh Tue, Vice President of Ho Chi Minh City Handicraft and Wood Processing Association (HAWA), said that from the beginning of 2024, many businesses in the wood industry have had orders until the end of the year. Thanks to that, the export revenue of the wood industry is approaching the level of 2022 with 5-month export turnover reaching 6.1 billion USD. In particular, the main markets of Vietnamese wooden furniture are the United States, China, and Korea, all recording growth.

Ms. Tue also raised another positive signal that imports of raw materials and auxiliary materials of the wood industry have recorded a growth of 21% in the first 4 months of 2024. This shows a signal of recovery of production activities, export wood and wooden furniture in the coming months.

Mr. Tran Nhu Tung, Vice Chairman of the Vietnam Textile and Apparel Association (VITAS) also said that the difficulties of 2023 have almost ended, replaced by positive signals since the beginning of 2024. In the first 5 months of 2024, the order situation has reveal positive signals; most businesses in the industry have orders.

Thanh Cong Textile and Garment Investment - Trading Joint Stock Company (TCM) recently announced that its revenue in April 2024 of nearly 12 million USD, an increase of 13% over the same period last year; Profit after tax reached 907,047 USD, 5 times higher than April 2023. Accumulated in 4 months, TCM reached 51.7 million USD in revenue, growing 8% and profit after tax reached 3.4 million USD, growing 38%. TCM said that it has currently received about 88% of the revenue plan for orders in the second quarter of 2024 and about 83% of the revenue plan for orders in the third quarter of 2024.

Although there have been many improvements in orders, Mr. Tung said, businesses have to deal with price difficulties. “Salary costs are increasing, while other costs do not tend to decrease. Meanwhile, customers are becoming smarter with their orders because they always compare Vietnam’s prices with other countries, especially Bangladesh - the 2nd in the world in textile and garment exports" - Mr. Tung shared.

Specifically, Bangladesh's minimum wage is only 80-90 USD, while Vietnam is currently 200 USD. Brands use Bangladeshi labor costs to place orders with Vietnam, causing great difficulties for businesses. Even domestically, price issues are fiercely competitive. Due to differences in labor costs between regions, there are orders that the South cannot receive but the North can. Additionally, in 2023, the Bangladesh currency has lost about 25%, causing Vietnam's prices to increase compared to Bangladesh.

Many competitive advantages

Mr. Tran Phu Lu, Director of the Ho Chi Minh City Investment and Trade Promotion Center (ITPC), assessed that there is a lot of development room for the fashion, furniture and household appliances industries of Vietnam in general and Ho Chi Minh City in particular. Especially, product quality, technical level, ability to meet strict labor and environmental requirements as well as tariff incentives of each market are Vietnam’s priorities.

Explaining this more clearly, Mr. Tran Nhu Tung said that among the 12 criteria of international brands evaluating major textile and garment exporting countries such as China, Bangladesh and Vietnam, Bangladesh only dominate 2 criteria compared to Vietnam in terms of low cost and tax policy. Because Bangladesh develops more slowly than Vietnam, this country is offered more preferential policies to encourage its development. Besides, the textile industry contributes up to 80% of Bangladesh's GDP, so the Government of this country has many policies to protect the industry.

Therefore, Mr. Tung assessed that in the long term, Bangladesh is not a competitor of Vietnam's textile and garment industry. Instead of current price criteria, many other requirements are needed. Recently, in Bangladesh, workers went on strike demanding a salary increase and the Government had to approve. This will cause difficulties in the future because labor costs will no longer be this country's strong point. In addition, Bangladesh also has the disadvantage of not having many seaports, especially deep-water port like Vietnam.

According to Mr. Tung, Vietnam's textile and garment industry still has many competitive advantages in the next 15 years, even if labor costs are increasingly high. Mr. Tung cited the story of China when it still leads the world in many manufacturing industries, even though the country's labor costs are very high. Accordingly, businesses are trying to meet green production criteria to have an advantage in attracting orders. Along with that, the shift to higher value products, investment in machinery and equipment to increase productivity, expand markets, and diversify products are also beneficiary...

Regarding the wood industry, Ms. Duong Minh Tue said that trade and trade promotion activities are being actively implemented to expand sales opportunities and connect with new customers for businesses. Notably, the Hawa Expo held last March brought very positive results with the participation of 20,000 visitors, through which 75% of businesses signed MOU contracts and the total preliminary order value was about 115 million USD. Accordingly, 72% of businesses have registered to participate in the exhibition next year.

HAWA also coordinated with the Department of Trade Promotion (Ministry of Industry and Trade) to register to participate in 4 consecutive times at the High Point fair - one of the largest fairs in the US, to impress customers on brand of Vietnamese wooden furniture. In particular, through 2 participation periods in October 2023 and April 2024, 3 businesses have had direct orders at the fair and 10 other businesses are making quotes for customers.

Ms. Tue also said that the Vietnamese wood industry is trying to reach a higher segment in the world wood market with investments in design and branding. Recently, HAWA also coordinated with ITPC to bring 30 furniture and fine arts enterprises to participate in the Milan Design fair - one of the pioneering design fairs in the world. "Introducing Vietnamese wooden furniture to appear at the fair with a neat image, right for this fair is an opportunity for the Vietnamese wood industry to affirm its design capacity" - Ms. Duong Minh Tue said. Thanks to current activities, it is forecasted that the export situation of the wood industry will regain growth momentum, even have a breakthrough, especially in the high value-added segment.

By Nguyễn Hiền/Minh Phuong

Related News

Mid-November: Vietnam

Mid-November: Vietnam's trade volume matches 2023 total, eyes record-breaking growth

VCN - By mid-November 2024, Vietnam's total import-export turnover reached an impressive US$681.48 billion, equaling the full-year trade figure for 2023
New export and business cooperation opportunities from "dual conversion"

New export and business cooperation opportunities from "dual conversion"

VCN - According to a recent study from NielsenIQ, 16% of Vietnamese consumers consider a sustainable future as one of the important factors in their consumption decisions.
Why seafood exports to some Middle Eastern Countries are stalled

Why seafood exports to some Middle Eastern Countries are stalled

VCN - Several shipments of seafood exported to certain Middle Eastern countries have been delayed due to legal challenges related to consular legalization procedures. This has created significant bottlenecks in accessing these markets.
Businesses need support from vietnamese representative offices abroad

Businesses need support from vietnamese representative offices abroad

VCN - Several heads of Vietnamese representative offices abroad believe that Vietnamese businesses need to prepare solutions to respond to the changing global economy and meet the increasing demands of the international market.

Latest News

US initiates investigation into pharmaceutical capsule shells imported from Việt Nam

US initiates investigation into pharmaceutical capsule shells imported from Việt Nam

Hard capsule pharmaceutical shells from Brazil, China and India are also being investigated.
UKVFTA gives advantages to Vietnamese fishery products in the UK, urging focus on quality for further expansion

UKVFTA gives advantages to Vietnamese fishery products in the UK, urging focus on quality for further expansion

To better exploit the tariff incentives from the UKVFTA, it is necessary for Vietnamese fishery producers and exporters to focus on improving quality and supply capacity to expand market share in the UK
Agricultural, forestry and fishery trade surplus value shoots up

Agricultural, forestry and fishery trade surplus value shoots up

VCN - According to the Ministry of Agriculture and Rural Development, the total export turnover of agricultural, forestry and fishery products in the first 10 months reached 51.74 billion USD, up 20.2% over the same period in 2023. Notably, the trade surplus value recorded a spectacular increase year on year.
VN

VN's food processing industry struggles to improve quality and value chain integration

Despite accounting for 19.1 per cent of Việt Nam’s processing sector, the food processing industry has been struggling with major issues such as poor-quality raw materials and subpar value chain integration, said industry insiders and economists.

More News

Approach strategy of the seafood industry when implementing UKVFTA

Approach strategy of the seafood industry when implementing UKVFTA

VCN - As one of Vietnam's strong export industries to the UK, especially when the Vietnam - United Kingdom of Great Britain and Northern Ireland Free Trade Agreement (UKVFTA) comes into effect, with a detailed information approach strategy, it has created a great driving force to promote the export of Vietnamese seafood products to this market.
Vietnamese enterprises facing challenges from cross-border e-commerce platforms

Vietnamese enterprises facing challenges from cross-border e-commerce platforms

VCN – In recent years, with the rapid development of cross-border e-commerce (CBEC) platforms, domestic enterprises in Vietnam have been facing numerous difficulties and challenges.
Vietnam, Malaysia eye new milestone in trade ties

Vietnam, Malaysia eye new milestone in trade ties

The official visit to Malaysia from November 21-23 by Party General Secretary To Lam is expected to open up new opportunities for and mark a new milestone in the economic and trade cooperation between Vietnam and Malaysia. Vietnam and Malaysia are key economic, trade, and investment partners. Their economic and trade ties have steadily grown since the two nations established diplomatic relations in 1973.
Shrimp exports surge in 10 months, generating 3.2 billion USD

Shrimp exports surge in 10 months, generating 3.2 billion USD

Vietnam’s shrimp exports in October reached US$394 million, a strong 24% increase year-on-year, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).
Vietnam’s exports to the U.S. near US$100 billion milestone

Vietnam’s exports to the U.S. near US$100 billion milestone

VCN - By the end of October, Vietnam's exports to the United States approached US$100 billion, reaffirming its position as Vietnam's largest export market.
From the “abnormal” coffee price, worries about the new crop

From the “abnormal” coffee price, worries about the new crop

VCN - The Vietnamese coffee industry enters the new crop with the question of what is a reasonable price to ensure benefits for coffee growers while still retaining international consumers.
What obstacles limit the market share of Vietnamese goods in the UK?

What obstacles limit the market share of Vietnamese goods in the UK?

VCN - Vietnamese goods account for only about 1% of total imports into the UK market. One of the reasons is that they have not yet built their own brands and have not focused on effective strategies and approaches to market information.
Storm No. 3 destroys profits of many insurance companies

Storm No. 3 destroys profits of many insurance companies

VCN - Due to the impact of storm No. 3, the business results of the third quarter and the first 9 months of 2024 of the insurance sector have been significantly affected. This requires more efforts from businesses for the results of the whole year 2024.
Vietnam, Malaysia eye golden partnership opportunities in Halal industry

Vietnam, Malaysia eye golden partnership opportunities in Halal industry

Cooperation in the Halal industry can help Vietnamese products reach nearly 2 billion Muslim consumers worldwide, representing over 24% of the global population, according to Malaysia’s Minister of Investment, Trade, and Industry Zafrul Abdul Aziz.
Read More

Your care

Latest Most read
US initiates investigation into pharmaceutical capsule shells imported from Việt Nam

US initiates investigation into pharmaceutical capsule shells imported from Việt Nam

Hard capsule pharmaceutical shells from Brazil, China and India are also being investigated.
UKVFTA gives advantages to Vietnamese fishery products in the UK, urging focus on quality for further expansion

UKVFTA gives advantages to Vietnamese fishery products in the UK, urging focus on quality for further expansion

To better exploit the tariff incentives from the UKVFTA, it is necessary for Vietnamese fishery producers and exporters to focus on improving quality and supply capacity to expand market share in the UK
Agricultural, forestry and fishery trade surplus value shoots up

Agricultural, forestry and fishery trade surplus value shoots up

VCN - According to the Ministry of Agriculture and Rural Development, the total export turnover of agricultural, forestry and fishery products in the first 10 months reached 51.74 billion USD, up 20.2% over the same period in 2023. Notably, the trade surp
New export and business cooperation opportunities from "dual conversion"

New export and business cooperation opportunities from "dual conversion"

According to a recent study from NielsenIQ, 16% of Vietnamese consumers consider a sustainable future as one of the important factors in their consumption decisions.
VN

VN's food processing industry struggles to improve quality and value chain integration

Despite accounting for 19.1 per cent of Việt Nam’s processing sector, the food processing industry has been struggling with major issues such as poor-quality raw materials and subpar value chain integration, said industry insiders and economists.
Mobile Version