Top 5 Reasons Why Fashion Brands Should Manufacture in Vietnam

As the global fashion industry continues to evolve, brands are constantly seeking new ways to streamline production and maximize profitability. Positioned as the world's fourth biggest textile exporter, Vietnam has cemented its status as a center of premium manufacturing, boasting a profound legacy and achieving exports valued at $39 billion in 2020 (source: Investment Opportunities in Vietnam's Garment and Textile Industry). Here are the top five reasons fashion brands should consider garment manufacturing in Vietnam.

1. Cost-effectiveness:?

Vietnam apparel manufacturing offers significant cost savings due to competitive labor costs and favorable exchange rates. The Vietnamese Dong's value against other currencies can provide substantial financial advantages for brands. Additionally, Vietnam's efficient supply chain ensures that production processes are streamlined, further reducing costs. Moreover, the country’s relatively cheap labor cost that sits at around $2.73 per hour also supports fashion brands’ pricing strategy (source: Manufacturing labor costs per hour: China, Vietnam, Mexico 2016-2020 | Statista).?

2. Skilled Workforce and Quality Production:?

Vietnam's workforce is highly skilled, thanks to a focus on education and vocational training. The emphasis on quality production means that garments meet the high standards required by diverse brands. With extensive experience and expertise, Vietnamese manufacturers handle intricate designs and complex production processes with ease. Their adaptability allows brands to quickly respond to changing fashion trends.

3. Strategic Location and Global Reach:?

Vietnam's strategic location in Southeast Asia provides proximity to major markets, including Europe, the US, and Asia, enhancing logistics and transportation efficiency. Moreover, Vietnam trade agreements offer favorable terms, making it easier and more cost-effective for brands to reach a global audience.

4. Growing Focus on Sustainability:?

Sustainable fashion is a priority in Vietnam, with manufacturers adopting eco-friendly practices and the government supporting sustainable initiatives within the garment industry. Their manufacturers gained multiple significant sustainable certifications, such as: BSCI, SA 8000, WRAP and ISO. This commitment to the environment aligns with the values of consumers and brands alike.

5. Government Support and Business-Friendly Environment:?

Vietnam investment incentives are designed to attract foreign businesses to its shores. The government offers a range of benefits to ease the financial burden on brands setting up operations, namely:?

• Trade Agreements: Vietnam's FTAs with the US, EU, and Japan minimize tariffs, benefiting global fashion brand exports.
• Investment Incentives: Tax breaks and land-use rights offered by the government decrease business costs for foreign investors.
• Industrial Park Infrastructure: Government investment in industrial parks provides modern facilities and efficient setups for brands.
• Skilled Workforce: A large, skilled labor pool, supported by government vocational training, meets the garment industry's needs.
• Streamlined Business Registration: Simplified processes for visas and work permits make it easier for foreign businesses to establish in Vietnam.

Additionally, the process of establishing a business in Vietnam has been streamlined, minimizing the bureaucratic obstacles that can often deter foreign investment.

In conclusion, Vietnam presents a compelling opportunity for fashion brands looking to enhance their production capabilities. With its blend of cost-effectiveness, skilled labor, strategic location, commitment to sustainability, and supportive government policies, Vietnam is poised to remain a top destination for apparel manufacturing. Intrigued? If you want to know how your brand can tap into this country’s garment manufacturing potential, read this article on Inflow’s website to find out: Unblocking The Potential Of Vietnam Garment Production.?