Apparel sector faces supply chain disruption

Stagnant business and production activities as a result of the impact of Covid-19, increased pressure over delivery to partners, and high transport costs are threatening the supply chains of the apparel sector.

Apparel sector faces supply chain disruption

“The supply chain of the apparel sector is nearing paralysis. If the situation does not improve, the prestige of Vietnam’s apparel sector will be seriously damaged in the eyes of international customers,” said Vu Duc Giang, chairman of the Vietnam Textile and Apparel Association (VITAS).

Since the coronavirus outbreak in Vietnam, many textile and garment firms in the southern region have suspended their operations, while a number of medium and small enterprises have withdrawn from the market, Giang added.

Though the stay-at-work mode was applied at firms, the production situation was yet to get better.

Le Uyen Trang Nha, general director of Viking Vietnam in HCMC, said that to maintain production, the firm arranged accommodation and dining rooms for employees, which hiked production costs. As 150 employees are staying at the factory for work, the firm must spend an extra VND450 million in costs each month.

Apart from increased production costs, the unstable sentiment of live-in employees has reduced labor productivity by 20%-30%.

Besides, many workers have left HCMC to return to their home towns to avoid the transmission of Covid-19, hindering operations.

Giang predicted that a mere 60%-65% of employees who rushed home would return to HCMC for work after the pandemic is brought under control, leading to a severe shortage of manpower.

 

In addition, the slower circulation and transportation of goods have contributed to disrupting the supply chains of the apparel sector.

The social distancing order under the prime minister’s Directive 16, which is being applied in many provinces and cities to prevent the spread of Covid-19, has slowed down the transport of materials, according to VITAS.

Local exporters have also faced difficulties in export activities as shipping costs were revised up sharply over the past few months. The fee to ship a 40-feet container from Vietnam to Europe has hit US$11,000.

Moreover, due to stagnant production, many international partners have canceled orders in Vietnam and placed orders elsewhere.

VITAS has repeatedly proposed the Government offer preferential and priority policies to the apparel sector, including allowing firms to operate normally if a district where the firms are located in provinces or cities in the southern region has undergone 15 days without new infections, but in vain, Giang said.

Source: SGT

More than 30% of textile, garment operations on hold due to COVID-19

More than 30% of textile, garment operations on hold due to COVID-19

The proportion of textile and garment factories that have closed due to the COVID-19 pandemic has reached 30-35 per cent according to the Vietnam Textile and Apparel Association (Vitas).

 
 

Other News

.
Black Friday 2021 launched in HCM City
Black Friday 2021 launched in HCM City
BUSINESSicon  20/11/2021 

The shopping festival Black Friday was kicked off on November 19 in Ho Chi Minh City.

Decrease in in seafood exports expected as a result of new Chinese policy
Decrease in in seafood exports expected as a result of new Chinese policy
BUSINESSicon  20/11/2021 

Vietnam’s seafood exports to China are likely to decrease sharply as Chinese customs are tightening control over imports.

Consumers more prudent with post-pandemic personal finances
Consumers more prudent with post-pandemic personal finances
BUSINESSicon  20/11/2021 

After giving birth to their second daughter, Thanh Van, a 39-year-old office worker in Hanoi, had to quit her job because she could not afford the cost of hiring a babysitter after a 30 per cent pay-cut due to the COVID-19 pandemic. 

Digital transformation to create new growth engine for Vietnam's agriculture
Digital transformation to create new growth engine for Vietnam's agriculture
BUSINESSicon  19/11/2021 

As digital transformation will help overcome most of the weaknesses faced by the local agriculture sector, it should be considered a breakthrough solution for sustainable growth and development in Vietnam.

Flower farmers do not dare grow large quantities for Tet amid Covid uncertainty
Flower farmers do not dare grow large quantities for Tet amid Covid uncertainty
BUSINESSicon  19/11/2021 

Many flower and bonsai farmers in HCM City and the Cuu Long (Mekong) Delta have reduced production for Tet (Lunar New Year) which falls early next year since they are worried the COVID-19 pandemic will affect demand.

Vietnam may have new USD billionaires
Vietnam may have new USD billionaires
BUSINESSicon  19/11/2021 

If assets are calculated according to the value of the stock market, Vietnam will have more USD billionaires.

Vietnam among top 10 countries with largest installed solar power capacity
Vietnam among top 10 countries with largest installed solar power capacity
BUSINESSicon  19/11/2021 

Visual Capitalist has listed Vietnam among the world’s top 10 for largest installed solar power capacity.

Global energy crisis: another concern for Vietnam's economy
Global energy crisis: another concern for Vietnam's economy
FEATUREicon  19/11/2021 

Disrupted coal mining in Ordis in Inner Mongolia, the most important coal mining hub in the world, is posing huge risks that could stifle global growth.

Too many traceability apps confuse farm-produce buyers
Too many traceability apps confuse farm-produce buyers
FEATUREicon  19/11/2021 

The farm produce traceability system in Vietnam still doesn’t match GS1 standards (the most widely used system of standards in the world), and, as such, the existing traceability apps are just for internal use.

More businesses seek black credit as cash flow plummets
More businesses seek black credit as cash flow plummets
FEATUREicon  19/11/2021 

Seventy-one percent of businesses anticipate revenue decreases in 2021, higher than the 65 percent figure in 2020, according to a survey.

VIETNAM BUSINESS NEWS NOVEMBER 19
VIETNAM BUSINESS NEWS NOVEMBER 19
BUSINESSicon  19/11/2021 

Seafood stocks surge on business recovery

Overspend in the works for reboot of national economy
Overspend in the works for reboot of national economy
BUSINESSicon  19/11/2021 

Vietnam may not be able to increase its budget deficit next year in order to ensure state budget spending, with the economy still sabotaged and business revenues still dented.

Captivating incentives target FDI from Europe
Captivating incentives target FDI from Europe
BUSINESSicon  18/11/2021 

Vietnam will continue considering foreign investment one of its important drivers for socioeconomic development over the next four years, with its ambitious plan to attract more high-quality funding. 

VN to strengthen financial foundation in the next ten years
VN to strengthen financial foundation in the next ten years
BUSINESSicon  19/11/2021 

Vietnam's top priority for 2021-30 is to build a financial foundation for the country's sustainable development, said policymakers and experts during a conference to discuss finance strategy for the 2021-30 period.

Pandemic makes 85 percent of Vietnamese consumers more likely to use digital banking in future
Pandemic makes 85 percent of Vietnamese consumers more likely to use digital banking in future
BUSINESSicon  18/11/2021 

Around 85 percent of Vietnamese banking consumers are more likely to use online and digital banking services compared to 18 months ago, according to a new report from SaaS cloud banking platform Mambu.

Food shopping trends change due to social distancing
Food shopping trends change due to social distancing
BUSINESSicon  18/11/2021 

The way people buy food in HCM City has changed after a period of social distancing amid the COVID-19 pandemic, with more food products bought online, according to online sellers.

The cost of reopening the economy
The cost of reopening the economy
FEATUREicon  18/11/2021 

Nearly two months have passed since Ho Chi Minh City and 18 southern provinces have lifted lockdown measures and set up the "new normal", with the operations of people and enterprises gradually resuming.

More gyms close as membership dwindles
More gyms close as membership dwindles
FEATUREicon  18/11/2021 

More and more gyms have shut down or have been transferred to others, sometimes for free.

Coffee, vegetable industries agree on codes of conduct to encourage sustainability
Coffee, vegetable industries agree on codes of conduct to encourage sustainability
BUSINESSicon  17/11/2021 

As many as 42 enterprises from the coffee and fruit-vegetable industries have signed a pledge to show their commitment to support and implement the codes of conduct (CoCs) 

Pandemic will have long-lasting impact on business operations in Vietnam
Pandemic will have long-lasting impact on business operations in Vietnam
BUSINESSicon  17/11/2021 

Many factories, including about 200 contracted factories that make sportwear for Nike Corporation, resumed production in Vietnam earlier this month. 

 
 
 
Leave your comment on an article

OR QUICK LOGIN