Vietnamese garment makers urged to look inward as exports slow

Vietnamese garment makers urged to look inward as exports slow Vietnamese garment makers are being urged to look at the domestic market as the export market for their goods may shrink considerably over the next few months to one year, according to a report over the weekend in Thanh Nien Daily.
   Speakers at a conference on textiles in Ho Chi Minh City last week said that although Vietnam has now risen to become the world’s ninth-largest exporter of textiles, that market will not continue to grow due to slowing global demand. Instead, the producers should look inward and focus on Vietnam’s growing domestic consumption.
   “Selling a shirt for ($9), producers can earn of a profit of ($1.80),” said Le Quoc An, chairman of the Vietnam Textile and Apparel Association. “In the case of export, they can only make about $1.”
   But there’s growing competition for supplying the domestic market, the report said, with foreign brands increasing their stake in Vietnam by the day, including opening up retail outlets of their own. As such, speakers urged garment makers to strengthen their own brands, rather than commoditize them and fall into the trap of only being suppliers to other brands.
   The report said that growing economic clout among younger age groups is manifesting itself in more spending on clothing — the Vietnamese think tank Business Studies and Assistance Center found that Ho Chi Minh City residents age 20 to 45 have increased their spending on clothing from 11 percent to 18.5 percent of their total income just in the past year.
   However, the survey also found that two-thirds of the consumers were most heavily influenced, style-wise, by clothes worn by actors in South Korean soap opera, which are very popular in Vietnam. The survey found that foreign brands had better marketed their apparel than Vietnamese makers.