Vietnamese apparel industry is expected to witness shrinking exports due to educing demand corresponding to global economic crisis. So, it should focus on the home market.
Experts in the industry seminar held in Ho Chi Minh City concluded that as Vietnam’s garment exports may contract due to the worldwide financial crunch, Vietnamese garment businesses should concentrate more on their domestic market, reported thanhniennews.
Currently, Vietnam is the ninth largest textile exporter in the world. Its shipments totaled above US$ 7.6 Billion in 2008, recording a 20% increase on YOY basis. Also, the garments accounted for 5% share in the $45 Billion retail market of the country in 2007. Further, the apparel market is expected to grow up to $6 Billion by 2010.
As the local designers are not able to offer tough competition, the international brands are penetrating deeply into the Vietnamese market. Also, local retailers and distributors are lagging behind in offering professional services. So consumers are maintaining a long distance from them.
However, few local companies are able to retain their popularity among the consumers as they are concentrating mainly on the casual wear. So far, the competition of the country’s garment sector has been limited to the “low-cost, general and conventional” clothing sectors.
Though some collections of top designers may give competition to popular international brands, but they lack in commercializing their brands or retailing their products. As a result, very few brands are enjoying a strong position in the market, providing an excellent opportunity to the international brands. This may led to a decline of the local apparel sector.
It would not be easy for local designers to establish even in the home market, as imported garments have already grabbed a significant share of it, particularly in the high-end section.
It is noteworthy that the ongoing financial turmoil would lead to falling demand from the leading markets like EU and the US, affecting the importers severely.
According to a Research Analyst at RNCOS, “Due to pre-occupation in the export markets, apparel companies are completely missing out the chance to expand in the domestic market. However, with 82 Million people, dominated by youth, Vietnam is an emerging fashion market in the world, especially in Asia.”
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