Founded with an investment of 12 million USD in 2005, Viet Hong Textile is a major denim fabric manufacturer in Vietnam today. In an interview with Fibre2Fashion, Quinn Hang, Vice Director of Viet Hong, discusses the strengths of the Vietnamese denim market, the government policies which are leveraging the textile industry at large and how Viet Hong managed to stay afloat even during the pandemic.
How big is the market for denim fabric in Vietnam? What percentage is exported annually?
In 2020, the total export value of Vietnam amounted to Free On Board (FOB) US $29,810B (garment and textile), in which around US $1.875 billion was generated from locally manufactured denim fabric.
What are the strengths of Vietnam as a denim producing country compared to rest of the world?
The strength of Vietnam as a denim producing country in comparison to its neighbouring countries, is that we have 10 bilateral and multi-lateral trade agreements with groups and organisations such as ASEAN Free Trade Area, FTAs with Japan, South Korea, Chile, Russia and EURASIA Economic Union, and countries which are expected to execute CPTPP and EVFTA such as Canada in 2022.
The investment amount in Vietnam is considered lower than its neighbouring countries as Vietnam has all the needed infrastructure; mills can just erect their machinery on ready facilities here to start production. The other strengths of Vietnam are as below:
Large domestic consumption
Vietnam has a population of almost 100 million. Workers are skilled and young.
Vietnam has vast number of foreign workers hired from different countries to support the industry and transfer necessary technology.
Companies of Vietnam are still investing, and more foreign investments are pouring in.
Buyer influx is coming out from China to Vietnam.
The industry is still looking for a life span up to 10-15 more years.
What is the annual yardage of denim manufactured in Vietnam and what is the percentage pie that your company would like to claim?
The estimated amount of denim being manufactured by local mills in Vietnam amounts to about 75 million metres a year in which Viet Hong produces 15 million metres.
How does the government support the textile industry at large? What are the top 3-5 unique policies that are helping this sector?
The Vietnam government has taken necessary steps to help the textile industry in assessing the supply chain of Foreign Direct Investment (FDI) enterprises.
The government has issued 68/2017/QD-TTG to promote, support and attract domestic and foreign investment which have the following policies:
1.Land rental fee incentives (the supporting industry zone will receive an exemption for 11 years)
2.Tax incentives (Corporate Income Tax (CIT) reduction, import duties, VAT)
Which colours, trims, fabric etc will dominate SS2020? What future trends do you foresee?
In SS2021/2022 - dark blue/mid colour denim washes will be the dominant colours; vintage washes will still be around. Moreover, the classic tied dye, dark bleach washes are anticipated to make a comeback.
How was Viet Hong Textile formed? How many people and how much funding did you begin with?
Viet Hong Textile JVC was established in 2005 and owned by Viet Huong Group, a family-owned business group with more than 30 years of entrepreneurial experience. With passionate and open-minded management along with our young and energetic staff, we were able to evolve out of a traditional local mill. Nowadays, Viet Hong is known as a reliable denim textile manufacturer not only in Vietnam but also in the international market.?
Initially, Viet Hong Textile started with an investment of 12 million USD and manpower of about 350 people in 2005-2006. Gradually we increased our investment by purchasing 60 more weaving looms (Toyota and Picanol) and sanforising machine (Montforts).
How does your supply chain network work? What regions of the world are part of your supply chain?
Our supply chains are mainly focused on Asia, China and some parts of America. These countries supply raw materials like chemicals and some dye stuffs.
How many types of fabric varieties do you offer?
Our fabrics are categorised as below:
a.Denim fabrics from 5 to14 oz rigid and stretch qualities.
b.Cotton and cotton blended with:
Dual FX T-400 + Lycra
c.Green/sustainable products like Repreve, USA/BCI Cotton, Organic Cotton and Ecovero.
What is the average turn-around time from fabric sourcing to shipment of the same to your clients?
Normal production lead time is 40 to 50 days. Within Vietnam, we can deliver the same day itself after production; overseas it is 10 to 15+ days including custom clearance.
Which brands and retailers are you currently associated with?
US Market (Express, Urban outfitters, Abercrombie & Fitch, Enjean, Hyper Denim, KDNK, Berksha, Dynamite, Rock Revival)
Japan Market (Edwin, Wego, Torachi)
Korea (Eland - Spao, FRJ, Zamboange)
From which geographies is the demand for your fabrics most from?
Asia, EU and US.?
What is the competition like for you from within Vietnam?
Competition is present in any industry; it makes the business more progressive and challenging. We are not threatened by our competitors as we provide customers with consistent good quality, services on a timely manner and competitive pricing. We always make it a point to go an extra mile, so no pressure is felt from our competitors.
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