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Vietnam-made apparel products inferior in home market
In the domestic market, Vietnam-made apparel products are less competitive than Chinese products in the segment for average people, and inferior to Thai, South Korean and Singaporean products in the segment for medium- and high-income earners.
Six years ago, Vinatexmart was set up to specialise in selling Vietnamese brand name apparel products. Leading garment companies, which had the sales turnover of several thousand billion VND a year, announced that they would make heavier investments to boost sales in the domestic market. The companies believed that the heavy investment would help raise the domestic sales proportion from 5-10% of total sales to 30-50%.
However, their belief has yet to materialise.
According to Phan Van Kiet, Deputy General Director of Viet Tien Garment Company, Vietnamese companies are weak in designing products and building brand names. Most of their designs prove to be uncreative and behind fashion trends in the world.
Regarding the building of brand names, Kiet said that Vietnamese enterprises have not paid appropriate attention to building brand names and polishing their images. He related that some companies have even brought products in stock to trade fairs, focusing on boosting retail turnover, not on introducing new products to develop the market.
Nguyen Thi Hong Huong, General Director of Vinatextmart, pointed out five shortcomings of producers. First, they do not always deliver products on schedule. Second, sizes of products of a single producer are not consistent. Third, enterprises use materials left over from making exports to make products for domestic consumption. Therefore, the fabric material, colour and pattern do not fit the tastes of local customers. Fourth, producers do not have standards for defining sale prices; therefore, they sometimes push the prices of products up to unreasonably high levels. And fifth, the quality of products is not stable.
Meanwhile, distributors have been complaining about poor cooperation with producers. HTN, a retailer who has 10 years of experience in selling apparel products, said that she can get the commission of 15-20% for selling apparel products, and she can pocket 5-7% only after paying expenses.
Nguyen Thi Nhan, the owner of a clothes stall at An Dong Market in HCM City, said that she can get the average profit of 40% in selling China-made products and 60% in selling luxury products. Nhan related that some companies, which have wide distribution networks nationwide, now do not focus on making products domestically anymore. They place orders with Chinese producers, or simply import products from China, then label the products with Vietnamese brand names to sell in the domestic market.
Huong from Vinatextmart said that the main task of developing the market for Vietnamese garment companies (the supermart has committed not to sell Chinese products within its network) proves to be a very difficult job. This goal will not be obtained until Vietnam-made products can meet the diversified demands of customers.
VNN
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