Facing many challenges

Up to now, enterprises in the textile and garment industry have only had orders until the end of October, and are in the process of continuing to negotiate for new orders. In particular, many businesses are forced to reduce prices, accept small and retail orders to maintain production and business activities, and ensure jobs for workers.

Chairman of the Board of Directors of Hung Yen Garment Corporation Nguyen Xuan Duong said that, after the first months of the year prospered, the unit is facing many difficulties when the price of raw materials increases, orders decline, causing serious problems. affecting the production plan, even, many units have to accept to lower the price by 20%-30% to have a source of goods to maintain operations.

Similarly, General Director of Dap Cau Garment Corporation Luong Van Thu affirmed that, from the beginning of the third quarter, the company's management has recognized that there are many adverse developments in the market, most garment enterprises are facing difficulties. in the sourcing of goods, the size and unit price both decreased. For the US market, the largest consumer market of textiles, on average, orders were reduced in both quantity and unit price, many orders of scale decreased by 50%-60%.

According to Vice Chairman of Binh Duong Textile and Garment Association Phan Le Diem Trang, businesses in the area are falling into a state of "hungry" orders, many businesses are forced to lay off workers and stop production. Some businesses use the policy of "austerity", deducting the reserve fund to hold out and wait for new orders.

Not only the textile industry, the leather and footwear industry is also "stumbling" because the cost of raw materials, logistics, ... has increased, affecting production and business activities of enterprises.

Vice Chairman of Binh Duong Leather, Footwear and Handbag Association, Director of Lien Phat Company Limited (Binh Duong) Truong Thi Thuy Lien said that before the negative impact of the Covid-19 pandemic, especially the war against Russia- In Ukraine, the inflation situation in some main markets has caused supply disruptions and reduced consumer demand. The EU and US markets are the main export markets of Vietnamese leather and footwear, which tend to decrease in terms of consumer demand, which will certainly affect purchasing power in the last months of the year.

Not only the textile industry, the leather and footwear industry is also "stumbling" because the cost of raw materials, logistics, ... has increased, affecting production and business activities of enterprises.

Notably, the orders from now to the first quarter of 2023 of leather and footwear enterprises also almost declined. In addition, the leather and footwear industry has a large inventory due to supply chain disruptions, which slows down year-end orders. To cope with the above situation, businesses have to cut subcontractors, reduce overtime, give workers and encourage workers to take annual leave. In addition, businesses negotiate with some customers to be able to reuse orders they have refused during the epidemic season to maintain operations and ensure the lives of workers.

Vice President and General Secretary of the Vietnam Textile and Apparel Association (Vitas) Truong Van Cam said that the textile and garment industry is a huge import and export industry and is directly affected by unpredictable fluctuations in the world. China, Japan, Taiwan (China), ... are still applying strict measures against the epidemic, affecting the supply chain of raw materials and product consumption.

In addition, the difficult economic situation and high inflation rate in major textile and garment consuming markets such as the US and EU have reduced purchasing power, affecting orders and unit prices of businesses, even. Many businesses fall into a shortage of orders.

Since the beginning of the year, enterprises have had to bear costs increased by 20%-25% due to high prices of fuel, raw materials, and transportation costs three times higher than the average of the past 5 years. In addition, the local currencies of many countries in the region depreciated significantly against the US dollar, while the Vietnamese dong only depreciated by 1.8%, which was detrimental to exporters. Labor shortages, capital difficulties after a long time fighting the epidemic and maintaining production also make businesses fall into a "difficult husband" situation.

Chain development

General Director of Cau Dap Garment Corporation Luong Van Thu added that in the context of many difficulties when customers tend to order small quantities, or many orders have been signed but the delivery time is delayed, Garment Dap Cau has turned to look for orders in the Japanese and Korean markets. Although these two markets are much more demanding than the US market with strict standards and small order sizes, the unit is ready to meet the requirements of customers and is determined to maintain its results in seven years. over the past month as well as stepping up the search for smaller orders to maintain production and secure jobs for employees.

A representative of the Vietnam Leather, Footwear and Handbag Association said that leather, footwear and handbag manufacturers should not focus on a few markets but need to diversify from supply to export markets. Enterprises need to have a strategy to develop high-quality human resources to meet the increasing demands of consumers.

Businesses expect the Government to soon approve the "Strategy for development of the textile and footwear industry to 2030, with a vision to 2035", creating conditions for the formation of large industrial parks with centralized wastewater treatment, industrial parks and industrial parks. advanced technology, green technology to attract investment in textile dyeing, solve fabric bottlenecks, meet origin requirements and make good use of incentives from new-generation free trade agreements.
The leather and footwear industry is currently only able to produce new quality product lines at the average level of the world, if the quality of human resources, skills, and skills of the workforce is improved, it will bring higher prices to customers. higher value for the product. In addition, the Association also recommends businesses to focus on developing the flow of raw materials towards sustainable development, such as a green and clean environment to keep up with the world's trend, while ensuring stability for the manufacturing industry. , while increasing the opportunity to access the supply chain in a sustainable way.

Chairman of the Board of Directors of the Vietnam National Textile and Garment Group (Vinatex) Le Tien Truong said that in the last months of the year, there were many unexpected and unexpected factors, which in nature do not belong to market rules. market, especially the Russia-Ukraine conflict, fluctuations in prices of raw materials and fuel, very high inflation in the US, Europe, etc.

From now until the end of the year, Vinatex will by all means keep jobs, orders and customers, without losing money to maintain production and business results in the past seven months. Currently, Vietnam's price is not a competitive advantage, there should be other advantages to compensate. In which, priority is given to the ability to supply packages, producing both yarn, fabric and sewing; pioneer in the production of green products, recycled products,...

In order to support businesses to overcome difficulties and develop sustainably, businesses expect the Government to soon approve the "Strategy for development of the textile and footwear industry until 2030, with a vision to 2035", creating favorable conditions for the development of enterprises. into large industrial parks with centralized wastewater treatment, advanced technology, and green technology to attract investment in textile dyeing, solve fabric bottlenecks, meet origin requirements and make good use of advantages. incentives from new-generation free trade agreements.

At the same time, the regulation on paying import tax on the spot for manufactured goods for export is removed; soon implement the business recovery support package and the support package to ensure social security and job support for employees. The Government and relevant ministries and branches should have orientations, risk recommendations, and remove obstacles related to payment mechanisms, transportation of goods and documents, etc. for enterprises exporting and importing into other countries. the area and around there are conflicts,...

Article, photo: MINH DUC and TRINH BINH

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