Garment sector urged to tighten operations
Garment sector urged to tighten operations
Garment and textile businesses should assume defensive postures to maintain market share and tighten up operations, as a precaution against decline, said Hoang Ve Dung, deputy general director of the Viet Nam National Textile and Garment Group (Vinatex).
A trending downturn in the overall number of manufacturing orders could signify deterioration in the business in 2015, according to the General Statistics Office of Viet Nam.
But Dung said the shortage of orders appears temporary, and does not betray a long-term market downturn.
Vietnamese garment and textile exports jumped 18.9 per cent in the last nine months to US$15.5 billion, buoyed by growth in traditional markets such as the US, the EU, Japan and the Republic of Korea.
Dung's advice to businesses translates to focusing on shoring up weak spots in marketing, boosting trade promotion to existing partners with a view to not losing any customers and keeping a close eye on the company's purse strings.
Business plans should be strictly aimed at maintaining the company's existing market share, Dung said. To this end, domestic businesses should become more proactive through participating in public events such as fashion shows and exhibitions.
The Vietnamese garment sector is facing fierce competition from Bangladesh, India and Indonesia, which have more material and labour resources. Local garment and textile businesses have been greatly affected by other nations, especially China, which can lower product prices to attract customers. Vietnamese businesses are likely to lose on their home turf in 2015, unable to compete.
But these businesses have already started renovating their methods of production from outsourcing activities to Freight on Board and Original Design Manufacturers models, which is a step in the right direction, Dung said.
Free trade agreements between Viet Nam and the EU and the Customs Union of Russia, Belarus and Kazakhstan and the Trans Pacific Partnership (TPP) bring hope for the future of the industry.
These agreements will open up future opportunities for the sector, but first businesses need to play defence and focus on improving their competitiveness.
bizhub
