Textile and apparel companies target expansion in foreign markets and local sales for potential growth
In the dynamic world of textile manufacturing, Vietnam's industry is undergoing a significant transformation. Many firms are moving away from a pure outsourcing model and are instead focusing on developing their own products, targeting high-end and niche markets. This shift is aimed at boosting productivity and reducing long-term costs through accelerated automation.
The need for localisation is paramount in this new landscape. Firms must increase their localisation rates, adhere rigorously to origin regulations, and leverage Free Trade Agreement (FTA) tax incentives to broaden their market reach. This is a strategic response to the reshaping of demand structures by a new consumer segment with higher incomes, who prioritise sustainability in the textile apparel market.
However, the road to success is not without challenges. Rising costs and a shortage of skilled labour in yarn production and design are major hurdles faced by Vietnamese businesses in the garment textile industry. Domestic raw material supply remains insufficient, and the auxiliary manufacturing sector is small, with limited orders and high capital recovery risks, discouraging investment.
Local brands in the textile apparel industry face a steep challenge in reclaiming market share at home. The domestic textile apparel market is fiercely competitive, with low-cost products dominating online platforms and imported high-end items holding sway in premium segments. Understanding Vietnamese consumer preferences and the growing 'Vietnamese use Vietnamese products' movement can be powerful if leveraged wisely, but intense price competition online from low-cost imports is putting local brands under significant pressure.
E-commerce and social media should serve as strategic pillars for businesses in the textile apparel industry, not just sales channels, according to Mai from VITAS. These platforms offer opportunities to connect with consumers directly, understand their preferences, and position products strategically.
Vietnamese textile and apparel companies have already achieved significant milestones. They first surpassed $5 billion in domestic sales by 2020, and Vietnam generated $6.1 billion in knitwear revenue that year. The sector experienced an annual growth rate of 8-10 percent between 2018 and 2023. This growth is reflected in export projections for 2025, expecting $46-47 billion worth of exports with yearly increases around $2-3 billion, indicating sustained strong expansion during that period.
The textile apparel sector in Vietnam posted over $26.4 billion in total export value in the first eight months of 2025, an increase of $2.1 billion or 10.8% year-on-year. Vietnamese businesses maintain a competitive edge in the garment textile industry due to product quality, delivery reliability, and a stable business environment.
Some textile apparel firms in Vietnam are seeing mixed performance amid a rebound in momentum this year. Renegotiating export contracts to share cost burdens with partners is a necessary first step for businesses in the textile industry to preserve orders. The government's role is also crucial in establishing specific exhibition and promotion centres for domestic textile products to enhance national brand identity and connect local businesses with foreign partners and investors.
Thien Thanh Binh, a company in the textile industry, is diversifying its market presence into Japan, Taiwan, and the EU, and developing a roadmap for environmental, social, and governance policies. This forward-thinking approach is essential as more producers in the textile apparel sector are adopting measures for green and sustainable production to meet increasingly stringent requirements from trading partners.
In conclusion, the textile industry in Vietnam is experiencing a period of significant change. By focusing on localisation, sustainability, and competition, businesses can navigate these shifts and position themselves for success in the years to come.
Read also:
- United States tariffs pose a threat to India, necessitating the recruitment of adept negotiators or strategists, similar to those who had influenced Trump's decisions.
- Weekly happenings in the German Federal Parliament (Bundestag)
- Southwest region's most popular posts, accompanied by an inquiry:
- Discussion between Putin and Trump in Alaska could potentially overshadow Ukraine's concerns
