Vietnam Sourcing: Garments 2017

Vietnam Sourcing: Garments 2017 Sector highlights

Vietnam Sourcing: Garments 2017 Suppliers & products

Vietnam Sourcing: Garments 2017

• Formal wear • Casual wear • Sportswear • Underwear & sleepwear • Baby & children’s wear

Our team has curated a collection of top-selling products from garment suppliers across Vietnam.

A number of these suppliers have websites on GlobalSources.com with full company details, product images with specifications, manufacturing capability and complete contact information. Click on the company names or product images to view their full profiles and product offerings on GlobalSources.com.

Sections

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• Featured suppliers with websites on GlobalSources.com
• Other featured suppliers

Featured suppliers with websites on GlobalSources.com

Ban Mai Co. Ltd
TVP Garment Joint Stock Company

For other Vietnam garment suppliers on GlobalSources.com, click here.

Other featured suppliers: For contact details, click on the product image or company name.

Dalat Trading JSC
Dong Nai Garment Corp.
Spring Garden Baby
Viet Styles Development Co. Ltd
Other suppliers	Dong Luc	K&G Vietnam	Vieba Co. Ltd

Click here for a listing of other Vietnam garment suppliers.

Vietnam Sourcing: Garments 2017 Supplier database

Vietnam Sourcing: Garments 2017 Industry overview

Vietnam Sourcing: Garments 2017

• Formal wear • Casual wear • Sportswear • Underwear & sleepwear • Baby & children’s wear

This section discusses key issues affecting export manufacturers in Vietnam, offering insight into industry composition and important supply centers.

Sections

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• Highlights
• Exports
• Competitive advantages
• Challenges
• Industry composition
• Vietnam garments suppliers

Charts

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• Textile & garment exports
• Supplier locations map

Vietnam’s textile and garment exports are on an upward trend. In the first nine months of 2017, the country sent abroad $19.2 billion worth of products, up 8 percent from the same period in 2016, according to preliminary data posted on the website of the General Department of Vietnam Customs.

Competitive advantages

The growth of the garments industry in Vietnam is attributed in part to the country’s existing trade agreements and ongoing trade negotiations, as these offer suppliers opportunities to enter new markets and boost sales to existing ones.

Vietnam is a signatory of the ASEAN Free Trade Area agreement. As a member of the ASEAN, it has signed free trade agreements (FTAs) with South Korea, China, Australia and New Zealand, India and Japan. The country also has FTAs with Japan, Chile, South Korea and the Eurasian Economic Union (EAEU), which consists of Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan.

The Vietnam-EU FTA (EVFTA), negotiations for which concluded in December 2015, is expected to come into force in 2018. Under the EVFTA, EU’s import duties on garments and textiles will be eliminated in a seven-year phaseout period once the FTA takes effect.

Negotiations for the Regional Comprehensive Economic Partnership (RCEP) are ongoing. The proposed trade pact is between the ASEAN members and the six economies with which the bloc already has FTAs, namely China, India, Japan, South Korea, Australia and New Zealand.

The Trans-Pacific Partnership, meanwhile, is being renegotiated following the US’ withdrawal from the deal. The 11 remaining signatories, which include Vietnam, reached a partial agreement on Nov. 11, 2017, on what is now called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

Besides facilitating exports, the FTAs and Vietnam’s efforts to fulfill commitments in line with its trade pacts and create more favorable business conditions support the sector’s development, encouraging investment in various stages of the garment and textiles supply chain. Foreign direct investment (FDI) in the country’s textile and apparel sector in the first half of 2017 amounted to $750 million, the YarnsandFibers News Bureau reported Aug. 1, 2017.

Another factor supporting the growth of Vietnam’s garments industry is its large workforce. The country has a population of more than 90 million, which is expected to grow to 100 million in 2020. Over 50 percent of the population is 25 years or younger and literacy rate is more than 90 percent, according to Vietnam’s Foreign Investment Agency (FIA), Ministry of Planning and Investment.

Labor costs in Vietnam are also relatively lower than those in China and several other countries in Asia.

Challenges

The textile and apparel industry’s reliance on imports for their raw material requirements remains a roadblock to the sector’s growth, preventing them from taking full advantage of the opportunities presented by Vietnam’s various FTAs. Vietnam’s trade deals have rules of origin which require that for garments or textiles to enjoy preferential tariffs, production starting from the yarn or fabric should be done within signatory countries. Dependence on imported feedstock also makes suppliers vulnerable to exchange rate fluctuations.

Cotton requirements, for one, are sourced mainly from the US, India, Brazil, Australia and Cote d’Ivoire, The Voice of Vietnam reported Feb. 17, 2017. For fabrics, among the main sources are mainland China, South Korea and Taiwan.

Preliminary data from the General Department of Customs show that Vietnam imported $8.3 billion worth of fabrics in the first nine months of 2017. Imports of textile, leather and footwear materials and auxiliaries amounted to $4.1 billion. The value of cotton sourced overseas exceeded $1.8 billion, while yarn imports amounted to more than $1.3 billion.

Rising production costs are also a concern amid the intense price competition in the domestic market and overseas. Minimum wages and related costs for social insurance and health insurance, for one, are expected to increase further in 2018. The necessity of meeting internationally recognized environmental and social accountability standards such as ISO 14000 and SA 8000, in addition to product-specific guidelines, are also raising operating expenses.

To boost their competitiveness, a number of garment factories are procuring more efficient equipment. A few makers are expanding their operations upstream by investing in their own dyeing or textile manufacturing facilities.

Garment makers are also shifting their production models from cut-make-trim (CMT) to free-on-board (FOB) and ODM.

Industry composition

Vietnam’s garments and textiles industry comprises more than 6,000 companies, which employ over 2.5 million people. About 2 percent of companies are state-owned, 15 percent are foreign-invested and the rest are private enterprises, a July 30, 2016, report on the East Asia Form disclosed.

Garment suppliers account for about 70 percent of the industry. The remaining companies consist of textile makers, spinners, dyeing enterprises and suppliers of input materials and accessories, according to a March 3, 2016, report on VietNamNet Bridge.

Midsize manufacturers can have up to 1,000 employees and their factories can be as large as 11,000sqm. These companies produce 23,000 to 100,000 pieces each month, their annual sales vary from $5.5 million to $11.5 million.

Suppliers with larger workforces have factories that are between 11,000 and 31,000sqm in size. These makers produce over 100,000 pieces each month, and their annual sales exceed $11.5 million.

Supplier locations map

The highlighted areas on the map show the locations of the Vietnam garment suppliers included in the database gathered by our consultants.

Vietnam Sourcing: Garments 2017 Product features

Vietnam Sourcing: Garments 2017

• Formal wear • Casual wear • Sportswear • Underwear & sleepwear • Baby & children’s wear

This section offers information on how trends in materials, design and manufacturing are impacting prices offered by Vietnam garment suppliers.

Buyers can also learn more about the materials used and the common price ranges of certain designs.

Sections

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• Highlights
• Materials & designs
• Manufacturing & QC
• Pricing
• Price guide
• Vietnam garment suppliers

Materials & designs

Vietnam garment manufacturers import the majority of fibers, yarns and fabrics used in production, typically from mainland China, South Korea and Taiwan. Domestically, raw materials are procured from the cities of Ho Chi Minh and Hanoi, and the province of Binh Duong.

Cotton, polyester and their blends are common raw material options across the various categories. In sportswear and underwear, cotton-spandex and nylon-elastane blends are also adopted.

At most garment manufacturers, OEM orders account for the majority of exports. A company has five to seven people assigned to R&D, which revolves mainly around developing designs and product samples based on client specifications. Creation of samples takes five to seven days.

In-house product development generally follows trends in the international market. In line with this, the selection of athleisure garments, or clothing that can be worn for casual and athletic activities, continues to expand. Multi-occasion garments are also increasing.

The trend for versatile clothing has resulted in cotton and polyester shirts that are quick to dry and resist shrinking, pilling and wrinkling. Jackets come in cotton, polyester or a fabric blend that is breathable, water- and wind-resistant, and have anti-bacterial features. Various types of underwear come in cotton, spandex and other textiles with anti-bacterial and anti-static features.

Versatility and comfort are also key considerations in producing business attire. Men’s and women’s suits are made of polyester or wool with breathable, anti-wrinkle and anti-static features. Non-iron cotton dress shirts provide additional convenience.

Manufacturing & QC

Most production processes are done in-house, including fabric cutting, sewing, embroidery, printing and packaging.

At many factories, the cutting, sewing, embroidery and printing stages are accomplished through the use of machinery. Machines are typically imported from China, although some makers are equipped with facilities from Japan, Europe and South Korea.

Garment manufacturers have at least five employees assigned to QC. Inspections are conducted on raw materials, as well as semifinished and finished products, to ensure that these match requirements.

Pre-production inspection includes checking that the fabric weight, construction and colors conform to specifications. The materials are also checked for dirt and stains.

QC steps during and after production include verifying the patterns; checking for stitching defects, stains and dirt; and ensuring that collars, cuffs, trims and accessories conform to specifications.

Among the product standards that companies follow are those of the EC Directives, the Oeko-Tex Standard 100 and the US’ Consumer Product Safety Improvement Act (CPSIA). Production-wise, many suppliers conform to ISO 9001. A number also comply with the requirements of SA 8000 and the Business Social Compliance Initiative (BSCI).

Pricing

Raw material costs are the main price determinants. Men’s business suits made of wool or polyester, for instance, are available for less than $150. Designs is cashmere are priced higher.

For casual wear, buyers can find a range of cotton and polyester shirts for less than $15. Jackets with shells made of polyester, cotton, nylon or a fabric blend can also be found in this price range. Designs typically have cotton or polyester filling. More expensive versions have down filling.

The selection of sportswear below $10 includes soccer jerseys and golf shirts made of polyester. Yoga pants in a polyester-spandex or nylon-elastane blend are also available.

For sleepwear, cotton men’s and women’s pajamas are offered for less than $15. Cotton nightgowns are also widely available at this price range, while silk designs are at least $20.

In the underwear segment, the selection below $5 includes men’s boxers, briefs and boxer briefs made of cotton or a fabric blend. Bras in cotton-spandex blends are also available.

For babies and children, T-shirts made of cotton or polyester are offered for less than $5. Cotton dresses for girls 1 to 7 years old can also be found in this price range.

Prices are expected to remain stable in the next six months. Many makers intend to reduce quotes by 5 percent or keep them at current levels despite raw material costs having risen 3 to 7 percent in the past 12 months. Suppliers are taking this route to stay competitive with China counterparts.

Price guide

Price guide: Men's business suits
Less than $70 Worsted or woolen wool; two- or three-button jacket; wrinkle-resistant
$70 to $150 Wool or polyester; two- or three-button jacket; wrinkle-resistant; three buttons
More than $150 Cashmere; three-piece suit; two- or three-button jacket; wrinkle-resistant

Click image to enlarge.

Price guide: Jackets
Less than $10 Polyester or cotton shell; cotton or polyester filling; water-resistant
$10 to $15 Hooded; shell made of polyester, cotton, nylon or a blend; polyester filling; water- and wind-resistant
More than $15 Hooded; shell made of polyester, cotton, nylon or a blend; synthetic or down filling; water- and wind-resistant

Price guide: Yoga pants
Less than $5 95% polyester and 5% spandex; 240 to 280gsm
$5 to $10 88-95% polyester and 5-12% spandex, 75-90% nylon and 10-25% spandex, or 77% nylon and 23% elastane; 240 to 300gsm; with pocket; UPF 50+
More than $10 88-92% polyester and 8-12% spandex, or 77% nylon and 23% elastane; 280 to 300gsm; with pocket; UPF 50+

Price guide: Men's underwear
Less than $1 Boxers, briefs or boxer briefs; cotton-spandex blend
$1 to $1.50 Boxers, briefs or boxer briefs; cotton, bamboo, polyester-cotton or cotton-spandex blend
More than $1.50 Boxers, briefs or boxer briefs; cotton or cotton-spandex blend

Price guide: Girls dresses
Less than $5 Short-sleeved dress; cotton; allover print
$5 to $10 Smock or short-sleeved dress; cotton or cotton-polyester blend; embroidered
More than $10 Short-sleeved or sleeveless dress; cotton or cotton-polyester blend; with lining; embroidered

Vietnam Sourcing: Garments 2017 PDF download

Vietnam Sourcing: Garments 2017

✓New products

✓Valuable market intelligence

Click on the download button to get a PDF copy of the full report, which contains the following:

Suppliers & products

Sections

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• Featured suppliers with websites on GlobalSources.com
• Other featured suppliers

Industry overview

Sections

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• Highlights
• Exports
• Competitive advantages
• Challenges
• Industry composition
• Vietnam garment suppliers

Charts

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• Textile & garment exports
• Supplier locations map

Product features

Sections

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• Highlights
• Materials & design
• Manufacturing & QC
• Pricing
• Price guide
• Vietnam garment suppliers