Despite ranking in the top 10 of global garment and textile exporters, experts say Vietnam has failed to capitalize on its own domestic potential.
A fashion show present wedding dresses by local designers. (Photo: SGGP)
Mr. Le Quoc An, chairman of the Vietnam Textile and Apparel Association, said that if the government doesn’t step up development of the domestic garment sector, foreign fashion brands will continue to dominate the market. Developing more women’s wear in particular, could have great potential for the country, he added.
The Vietnamese fashion industry is currently struggling against competitors from China, Thailand and Korea, and just a small number of enterprises among more than 2,000 companies nationwide have achieved success in promoting their fashion products in the local market.
While foreign companies purchase inexpensive local products and then mark them up substantially under famous brand names, Vietnamese businesses earn just a few cents for every unit of clothing sold to exporters.
Experts say Vietnamese businesses are afraid of investing money in advertising, developing new product lines and lack a distribution network, designers and human resources.
Instead of putting in the time and money to achieve long-term success in the local market, most domestic companies feel it is cheaper and easier to export their products.
An official at an enterprise that exports children's garments said that her company’s domestic consumption has increased just 15 percent after three years of manufacturing products for local markets. Domestic sales account for 30 percent while export sales dominate with 70 percent.
The deputy chairman of the Ho Chi Minh City Leather and Footwear Association, Diep Thanh Kiet, said that if local enterprises want to make a name for themselves, they should focus on four steps including design, marketing, production, and establishing a distribution network.
With a population of more than 86 million, experts say Vietnam is a fertile market for garment companies but success is dependent on bold action and a strategic plan.