This reality poses an urgent need to diversify markets and optimize the supply chain of raw materials to promote potential and increase competitiveness for the industry.
Risk of losing advantage
According to Vice President and General Secretary of the Vietnam Leather, Footwear and Handbag Association Phan Thi Thanh Xuan, the Vietnamese leather and footwear industry currently ranks third in the world in terms of production capacity (after China and India) with a scale of 1.4 billion pairs in 2024; and second in the world in terms of exports (after China), with a scale of 1.3 billion pairs. America and Europe are the two largest export markets. Vietnam possesses many advantages in developing the leather and footwear industry because it has a brand name and is recognized by partners as having a stable and safe supply of footwear with medium to high quality. Another advantage is that Vietnam has signed 17 free trade agreements with many countries, highly skilled workers...
However, the industry is at risk of losing the above advantages as labor costs continue to rise, directly affecting business profits. This can also cause the supply chain to shift to other countries with better costs.
Challenges include dependence on imported materials, especially raw materials, increased non-tariff barriers, requirements for green production, circularity, and emission reduction, etc.
In particular, the company is heavily dependent on international market fluctuations as 90% of its footwear output is for export. The risk of US tariffs has a major impact as Vietnam exports to this country accounting for 40% of its output.
Along with footwear, textiles and garments are also a key export industry with a turnover of nearly 44 billion USD in 2024, with main exports to the US market accounting for 38.2%, Japan accounting for 10.5%, China and South Korea more than 8%... Textile and garment exports in the first 5 months of 2025 reached 17.58 billion USD, an increase of 9% over the same period last year.
However, the textile industry is also facing a volatile market due to political conflicts, protectionism, changes in consumer habits from fast fashion to sustainable fashion, labor and environmental standards...
Early establishment of raw materials market
Faced with competitive pressure, global economic fluctuations and strict standards from the international market, the textile, garment and footwear industry is facing the need to accelerate restructuring from improving production capacity to expanding the market.
According to Vice President and General Secretary of the Vietnam Leather, Footwear and Handbag Association Phan Thi Thanh Xuan, at this time it is urgent to diversify export markets, in which exploiting markets with which Vietnam has signed free trade agreements (FTAs) is an effective long-term solution.
According to experts, to make good use of FTAs, businesses must proactively switch from processing to product development, increase added value, invest in green production and comply with international technical standards.
In response to these requests, textile, garment and footwear industry associations have recommended that Vietnamese trade offices abroad support businesses in conducting in-depth research on new markets to build export databases and help connect with potential customers. In addition, optimizing the cost chain, especially the raw material chain, is considered an important solution to help maintain the industry's advantage.
Similarly, for the textile industry, the fundamental solution is for our country to be self-sufficient in the supply of raw materials. Accordingly, our country must have a strategy to build a textile industry with a high localization rate, attracting investment in fabrics and dyeing. If we simply diversify the supply of raw materials by buying a lot, when the market fluctuates, textile enterprises will be affected.
From the reality of the business, Chairman of the Board of Directors of Giovani Group Joint Stock Company Nguyen Trong Phi said that the introduction of costume designs by Vietnamese businesses is slower than that of other countries, partly due to the capacity to develop designs, and partly due to the lack of raw material markets.
Therefore, Mr. Nguyen Trong Phi proposed that the authorities should soon have mechanisms and policies to develop the market for raw materials for the textile and footwear industry so that businesses can be proactive and speed up the process of making samples, increasing competitiveness. In addition, it is necessary to build a specialized industrial park for the textile and footwear supporting industry, thereby helping businesses have enough raw materials, while contributing to reducing product costs.
According to Tran Thu Quynh, Head of the Vietnam Trade Office in Canada, to maintain growth momentum, Vietnamese enterprises need to shift to developing their own brands, focusing on niche segments such as middle-aged women's fashion, low-income youth fashion, safety shoes, silk clothing, and interior design... Actively participating in international fairs and exhibitions and having a physical presence in distribution channels will help enterprises access the market more effectively, gradually escape dependence on the traditional processing model, thereby building sustainable competitiveness in the long term.
Source: https://hanoimoi.vn/nguy-co-xuat-khau-det-may-da-giay-mat-loi-the-cap-thiet-da-dang-hoa-thi-truong-704885.html
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