Garment firms prepare for tough battle at home as trade deals loom

Monday, Feb 01, 2016 08:21

Domestic garment and textile firms will face huge challenges at home soon. — VNA/VNS Photo Tran Viet

HCM CITY (Biz Hub) — Vietnamese textile and garment companies face a huge challenge with the market set to be flooded with imports following the country's accession to the ASEAN Economic Community (AEC) and Trans-Pacific Partnership (TPP) treaty.

"I realise that customers will support domestic goods, but the most important factor to retain Vietnamese clients is to assure quality," Nguyen Thi Dien, chairwoman and executive director of the An Phuoc Shoes Sewing and Embroidering Company, has been quoted as saying on the government website.

Since 1995 Viet Tien Garment JointStock Corporation has set up a distribution chain with 1,390 shops and agents around Viet Nam. Besides the famous Viet Tien brand name, the corporation also owns various fashion brands for both adults and children.

With over 200 shops, Blue Exchange has a big market share of garments for young people.

"In recent years demand for garment products has increased by 10 – 15 per cent annually," Hong Ve Dung, deputy general director of the Viet Nam Garment and Textile Corporation, said.

Dien said since competition with garment products from other ASEAN countries would be unavoidable, local companies should improve their quality and expand models to strengthen their competitiveness.

Despite the fact that the market is set to become more competitive, An Phuoc has kept its growth target of 15 -17 per cent.

This year it plans to open 10 more shops to add to its 105 existing ones.

"Promoting new design, strengthening brands and expanding the distribution system are the best ways to cope with the effects of the free trade agreements."

"ASEAN garment products will flood the Vietnamese market and directly compete with domestic products," Hong Ve Dung said.

"Local companies hope for lower interest rates to cut their expenditure and improve their competitiveness." — VNS

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