Vietnam’s textile industry has contributed significantly to the development of the export market economy.
According to the report, the textile industry is estimated to have exports of US$39 billion. In reality, US$1 billion is lower than the target of US$40 billion, due to the negative impacts of the US–China trade war.
By 2030, Vietnam's textile industry is expected to generate US$100 Billion in export revenue – according to Prime Minister Nguyen Xuan Phuc at Vietnam Textile and Apparel Association (VITAS). Besides, the Vietnam Leather, Footwear and Handbag Association (LEFASO) has addressed the decreasing of imported materials and increasing local supply chain.
4 Challenges the Textile Industry Must Overcome to Meet 2030 Goals
1st: “Made in Vietnam” pays attention to the domestic market
Vietnam's middle class is expanding quickly, and by 2030, with the population of 100 million people expected to grow by 50%. Businesses in Vietnam should focus on the local market and prioritize domestic consumption, as it holds significant potential for the near future.
In this chaotic period, Xuan, Vice President and General Secretary of LEFASO highlighted the need for collaboration between various stakeholders, including the government. Support in terms of policies, logistics, and import procedures for raw material.
2nd: Skilled labor structure is limited
By the end of 2018, only 25% of nearly 3 million workers in 7,000 enterprises had professional training. The remaining 75% were untrained, with most having completed only lower secondary or high school, and 17% only primary school.
3rd: The diminishing of labor competitiveness
With the industry's advantage in low labor costs slowly plummeting and potentially shifting to less-developed countries, Phuc urged Vietnam’s textile sector to elevate its role within the global value chain to uphold the country's position as a leading player in the global textile market.
4th: Lack of autonomy in the textile industry
60% of fiber materials are imported from other countries. Vietnam still lacks raw materials, we are just focusing on yarn manufacturing and processing the remaining steps to complete product production. We have to master and develop in phases like dyeing, manufacturing high-quality fabrics and accessories. Therefore, garments from Vietnam companies will be more valued by their intricate stages.
Reports from the World Trade Organization and World Footwear magazine show Vietnam is the world’s second-largest footwear exporter and third-largest textile exporter. However, most raw materials for these industries are still imported from China, South Korea, and ASEAN countries.
To become the Material Trading Centre, the Prime Minister suggested that:
Vietnam imported $13.42 billion worth of raw materials for its textile and footwear industries in the first half of 2024, a 14.11% increase from the same period in 2023, according to Vietnam Customs.
The Prime Minister urged the development of at least 30 Vietnamese textile and apparel brands to compete globally by 2030.
Global markets are pushing for net–zero and sustainability objectives more and more, they tend to seek collaboration with powerful supply chains. This means big fashion brands want to get their products made by the resources that come from areas covered by free trade requirements for both importing and exporting.
Phuc stressed the importance of building skilled workers, promoting trade, sharing policies and knowledge, and supporting businesses in market research and technology, especially in fabric and accessory production, to enhance productivity and protect the environment.
Inflow is poised to become Vietnam's leading manufacturing platform.
As emphasized by the Prime Minister, Nguyen Xuan Phuc – Vietnam’s textile industry must promote the skillful workforce and strongest internal supply chain to become the Material Trading Centre of the world, surpassing the 3rd place behind China and Bangladesh.
Inflow–leading on-demand manufacturing platform in Vietnam, striving itself to address the knot of issues in the textile industry by adopting innovative technologies into the manufacturing system, prioritizing local sourcing and enhancing the collaboration of more than 100 vetted suppliers in Vietnam. Let’s explore how Inflow prepares for the new flow of the fashion industry.
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Ethical Manufacturing Partners
Inflow is revolutionizing the fashion industry by connecting fashion brands with Vietnamese manufacturers committed to ethical labor practices. The platform ensures that these manufacturers not only comply with labor standards but also promote a culture of dignity and respect for workers. Inflow's rigorous vetting process guarantees transparency in wages and a zero-tolerance policy towards child and forced labor.
Read more: Ethical Labor: The Cornerstone of Vietnamese Sustainable Fashion
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Global Standards Achievement
Inflow’s commitment to sustainable manufacturing is evident through the global certifications we've successfully attained, including Organic Content Standards (OCS), Global Organic Textile Standard (GOTS), Worldwide Responsible Accredited Production (WRAP), Social Accountability (SA8000), ISO 14001:2015, and Business Social Compliance Initiative (BSCI). These certifications are not mere tokens but represent stringent compliance to international sustainability standards.
Read more: Certified Sustainability in Vietnam: Achieving Global Standards
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Streamlined On-Demand Manufacturing
Inflow adopted an on-demand model to streamline apparel production, using advanced tech and industry expertise to produce efficiently without large inventories. For new SKUs, we offer initial orders as low as 100–200 units to test demand. If sales perform well, clients place larger orders at lower per-unit costs. Inflow allows the original source to accept or, if declined, outsources to OEMs for higher volumes at competitive rates.
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Adopting Advanced Technology
Inflow, Vietnam's top on-demand manufacturing platform, equips medium to large sized fashion brands with advanced sourcing, design, and AI tools for efficient collection production. Inflow’s AI helps brands predict trends, reduce excess inventory, and adapt to the new fashion era through tech-driven product development.
Read more:
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Why Inflow's AI-Driven Catalogs Are Essential for Fashion Brands
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Why Fashion Brands Must Integrate Advanced Technology into Product Development
In conclusion
Vietnam's garment sector has experienced rapid growth in recent years, driven by its strategic location, diverse resources, political stability, and significant foreign investment. The Vietnamese government is actively working to harness domestic potential to compete internationally by implementing laws and policies that support free trade agreements, education, resource development, and technology. The goal is to surpass Bangladesh and China, positioning Vietnam as a global Material Trading Hub with exports reaching $100 billion.
To strengthen the ‘Made in Vietnam’ brand and elevate its global presence, Inflow, as a leading manufacturing platform in Vietnam, acknowledges the challenges ahead. However, we remain steadfast in our commitment to empowering fashion partners by fostering a collaborative community focused on efficient clothing production. We leverage data-driven technology, along with a network of skilled manufacturers, suppliers, and in-house professionals to streamline the production process.
The main goal is to meet market demands while setting new standards for innovation and quality. Through collaboration and improvement, we aim to position Vietnam as a global fashion leader, making 'Made in Vietnam' synonymous with quality, style, and sustainability.