The Vietnam National Textile and Garment Group (Vinatex) has called the country’s textile and garment firms to focus more on local market segment.
While advising the Vietnam’s businessmen and women from the sector, Le Tien Truong, General Director, Vinatex, asked them not to directly compete with their foreign counterparts.
He said that high and increasing costs of distribution was threatening the survival of local fashion brands, with some of them having leased stores in leading trade centres and paying rent in hundreds of millions of dong every month.
The local firms, he said, should have huge capital to increase their distribution channels and have adequate staff of designers.
This is the only way to match fashion bigwigs like H&M, who are selling products at a price less than the production cost to attract buyers.
Lately, quite a few textile and garment companies have built their own market segments, of which Nha Be Garment Corporation is known globally for exceptionally high quality suits. The Viet Tien Garment Joint Stock Corporation is another such company that is today known for high-quality shirts.
Truong said that Vinatex Mart, owned by Vinatex, earned VND10 billion every month last year, Besides, Vinatex Mart has played an important role in enabling other group companies considerably reduce the distribution cost.
He added that the increasing presence of illegally imported Chinese products in rural areas makes it difficult for local firms to capture these markets; however Vinatex is hopeful having chosen a path of slow and steady growth.