Textile and garment businesses diversify their markets.

Mr. Pham Quang Anh, Director of Dony Garment Co., Ltd., said that the company's production and business activities are currently quite promising. As of the end of August 2024, the company had grown by 51% compared to the same period last year.

Regarding the reasons driving the company's growth, Mr. Pham Quang Anh said it was due to the expansion into new markets. Besides traditional markets such as the US and the Middle East, Dony has found customers in nearby markets such as Singapore, Malaysia, Thailand, and Cambodia…

“ These markets may not sound glamorous, but they offer many advantages. The close geographical proximity reduces transportation costs and delivery times, and the similar consumer habits and aesthetic tastes make it easier to meet demand ,” the director said.

Dony Garment Co., Ltd. achieved high export growth thanks to market diversification. Photo: Dony

On the other hand, diversifying markets helps businesses avoid the negative impacts of economic downturns and reduced consumer demand in major markets. It also helps avoid increased transportation costs due to recent conflicts in the Red Sea region…

Not only Dony, but textile and garment exports have been thriving since the beginning of the year. Mr. Vu Duc Giang – Chairman of the Vietnam Textile and Garment Association – said that in the first nine months of 2024, the industry achieved $38.4 billion in export turnover. Of this, major markets still account for a significant proportion, such as the US at 39-40%, followed by the EU, Japan, and China…

The Vietnam Textile and Garment Group is also one of the enterprises that achieved good results in the first nine months of 2024, with consolidated revenue estimated at VND 13,036 billion, equivalent to 100.7% compared to the same period in 2023, reaching 72.8% of the plan; export turnover reached USD 1,448 million, equivalent to 107% compared to the same period last year. Average income per employee reached VND 10.13 million/person/month (equivalent to 107.5% compared to the same period in 2023).

However, in a deeper analysis of the export growth picture, the director of Dony Company believes that the market has improved but not significantly. In 2023, brands had very low inventory levels, so this year they are compensating for it, leading to increased orders, rather than a strong increase in consumption. In fact, orders in July and August have already shown signs of slowing down.

On the other hand, some argue that the increase in textile orders is due to a shift from Bangladesh, but this is not the case. The conflict in Bangladesh is relatively recent, and it takes customers 3-6 months, or even 1-2 years, to shift orders. Therefore, if there is a real shift, it will likely occur at least in the second half of this year and the beginning of next year.

Sharing his outlook on the market for the last quarter of 2024, Mr. Pham Quang Anh stated that for Dony, the situation remains relatively stable. The company currently has enough orders to last until the end of March 2025. The company is continuing to seek new orders while striving to diversify its markets to avoid putting all its eggs in one basket, thus maintaining production and export growth. "The market rarely experiences overall fluctuations; fluctuations are usually limited to specific regions. Therefore, to avoid risks, businesses need to diversify their markets," Mr. Pham Quang Anh reiterated.

For the Vietnam Textile and Garment Group, the group's leadership has determined that member enterprises need to continue to take decisive action, improve production capacity, and practice austerity to ensure stable production and business operations, especially for raw material production enterprises that have been facing difficulties for the past 30 months.

From an industry perspective, Mr. Vu Duc Giang noted that free trade agreements are making a significant contribution to the industry's growth. The Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) agreement, in particular, has created great opportunities for Vietnam's textile and garment industry to access new markets such as Canada, Australia, and New Zealand, and has also helped businesses adapt to the purchasing methods of importers within the bloc. Therefore, it has generated very clear growth for the textile and garment industry, particularly in exports to member countries and especially to the Americas.

Representatives of the Vietnam Textile and Garment Association also stated that, in the remaining months of the year and in the following years, the textile and garment industry will continue to exploit the advantages from free trade agreements to boost production and exports.

Source: https://congthuong.vn/doanh-nghiep-det-may-da-dang-hoa-thi-truong-350282.html