Vietnam continues to solidify its position as a global leader in apparel exports, with significant growth across major markets such as the United States, the European Union, and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) countries.
Below is a detailed breakdown of Vietnam’s top-performing apparel categories and their market performance.
Vietnam’s Apparel Exports to the United States
Vietnam’s apparel exports to the U.S. are dominated by three primary Harmonized System (HS) codes: HS 61, HS 62, and HS 63.
- HS 61110 (Sweaters and Bras): The largest export category, accounting for 14.6% of total apparel exports.
- HS 6204 (Women’s or Girls’ Clothing): The second-largest category, representing 13.2% of exports.
Between March 2023 and February 2024, Vietnam exported 33,261 shipments of apparel to the U.S., reflecting a 16% growth year-over-year. This achievement involved 1,998 exporters supplying goods to 5,924 U.S. buyers.
Notably, exports under HS 6307 (Other Made-Up Articles), which includes custom cut-to-measure garments, recorded the strongest growth. In December 2023, shipments under this category surged by an astounding 5033% year-over-year, with 154 shipments sent to the U.S.
Vietnam’s Textile and Garment Exports to the EU (2024)
In the first seven months of 2024, Vietnam’s textile and garment exports to the EU were led by-products under HS codes 62 (non-knitted garments) and HS 61 (knitted garments), which together accounted for the majority of shipments:
- HS 62 (Non-knitted Garments): Dominated the market with 1.17 billion USD in export value, representing 49.94% of total exports.
- HS 61 (Knitted Garments): Followed closely with 908.89 million USD, accounting for 38.8% of exports.
Notable Products
- HS 620140 (Overcoats, Riding Coats, etc.): Contributed 170.33 million USD, or 6.15% of total exports.
- Men’s Synthetic Fiber Pants/Shorts: Held a 5.84% market share.
- T-shirts: Experienced a 39.72% increase in exports, capturing 5.32% of the market share. Strong demand was observed in Poland, Belgium, Germany, and other EU nations.
See more: Vietnam Textile And Garment Export Value 2011 – 2023
Vietnam’s Textile and Garment Exports to the CPTPP Market (2024)
The CPTPP market, which consists of 11 member countries, is a crucial destination for Vietnam’s textile and garment industry. Exports under HS 62 and HS 61 accounted for an impressive 93.7% of Vietnam’s total textile and garment exports to these countries.
Top-Performing Categories
The CPTPP includes 11 member countries, and HS 62 and HS 61 (textiles and garments) account for 93.7% of Vietnam’s textile and garment exports to these countries.
Key products include:
T-shirts, tank tops, and similar cotton knitted garments: Largest export group, accounting for:
- 78% of exports to Japan
- 7.95% to Canada
- 4.96% to Australia
Strongly favoured in the CPTPP market, especially in Japan.
Men’s shorts and boys’ trousers (synthetic fibers, non-knitted): The second largest category, making up 6.35% of textile and garment exports to the CPTPP, with 75% of exports going to Japan.
Women’s non-knitted shirts (HS 620690): Although only 0.5% of the market share, this category has increased by nearly 200% in the first five months of 2024. It shows strong potential, particularly in Japan, Canada, and Australia.
Current Status of Vietnamese Textile and Garment Enterprises
Enterprise Types and Distribution
In the period from 2011 to 2019, private enterprises made up about 90% of the textile and garment enterprises in Vietnam. However, since 2019, the proportion of private enterprises has decreased to 80%, primarily due to small and medium-sized enterprises (SMEs) facing difficulties after the pandemic. Among the roughly 5,000 enterprises operating in the sector, 88% are micro and small enterprises.
As of 2023, Vietnam is home to about 7,000 textile and garment enterprises. Of these, 80% are small and medium-sized, while more than 10% are foreign-invested enterprises (FDI). The industry employs approximately 3 million workers, with 70% of the workforce focused on production.
Production Types
In terms of production, more than 70% of the textile factories in Vietnam focus on garment production. Only 6% of the factories are involved in yarn production, 17% in fabric production, and 4% in dyeing. This production distribution reflects Vietnam’s strong position as a global garment exporter, especially in the apparel segment, while the other areas, such as yarn and fabric production, remain comparatively smaller in scale.
Overall, the Vietnamese textile and garment industry is resilient and continues to adapt to challenges, with a strong emphasis on garment manufacturing, a growing number of enterprises, and a diversified structure including both local and foreign-invested businesses.
Salary and Income Structure
The basic salary for workers in the Vietnamese textile and garment industry is relatively competitive, averaging around 170 USD per month. However, due to the high demand for production and tight deadlines, regular overtime is a common feature. The typical overtime range for workers is between 47 to 60 hours per month, which contributes an additional 52 USD per person per month, accounting for 22.4% of the total income.
Overall, the average total income of garment workers in Vietnam typically ranges from 200 to 250 USD per month. Skilled and experienced workers can earn significantly more, with salaries for highly specialized roles reaching between 300 to 350 USD per month. These workers typically handle advanced tasks that require more expertise, resulting in higher pay per hour and a more specialized role within the factory.
Raw Materials Used in the Vietnamese Garment Industry
The Vietnamese garment industry heavily relies on imported raw materials to meet its production needs, as domestic raw material production only covers about 30% of demand. In 2022, Vietnam imported 22.99 billion USD worth of raw materials for the textile and garment sector. The industry’s dependency on imports is a critical aspect of its production structure, particularly with the processing methods used in garment manufacturing.
Processing Methods: CMT vs. OEM
- CMT (Cut-Make-Trim) is the dominant production method in Vietnam’s garment industry, used by 70% of enterprises. Under this method, partners provide 100% of the fabric, and Vietnamese manufacturers focus on cutting, making, and trimming the garments. This method is common among small and medium-sized enterprises, as well as many foreign-invested companies.
- OEM (Original Equipment Manufacturer), where enterprises self-supply fabric, is employed by nearly 25% of garment businesses, mostly foreign-invested enterprises (FDI). These companies tend to have more control over their supply chains, including sourcing raw materials like fabrics and fibers, which allows for greater flexibility and cost efficiency.
Sources of Raw Material Imports
The primary sources of raw materials for the Vietnamese textile and garment industry are as follows:
- China is the largest supplier of raw materials to Vietnam, accounting for around 51% of total imports. China provides a wide range of raw materials, including knitted fabrics, cotton yarn, and chemical fibers.
- South Korea, Taiwan, and Australia are also significant suppliers, though their contributions are smaller compared to China.
Key Imported Raw Materials
The most commonly imported raw materials include:
- Knitted and crocheted fabrics: These materials represent 27.1% of Vietnam’s textile raw material imports.
- Cotton, cotton yarn, and cotton woven fabrics: Accounting for 24.9% of imports, these materials are essential for producing various types of garments.
- Yarn and chemical fiber fabrics: These materials make up 15.1% of imports and are crucial for producing fabrics with a variety of textures and characteristics.
- Chemical fiber fabrics: Representing 9.7%, these materials are used to create durable and synthetic fabrics for a wide range of garment types.
Conclusion
Vietnam’s textile and garment industry is poised for significant growth due to favourable factors such as reduced export taxes from 16/19 signed free trade agreements and opportunities arising from geopolitical shifts, particularly in the US market. The US’s efforts to stimulate its economy, coupled with low interest rates, create an ideal environment for increased exports from Vietnam, as US and Chinese companies seek alternative supply sources.
In the first 8 months of 2024, Vietnam experienced a 4–14% growth in textile and garment exports, with some product lines growing by over 20%. This growth is attributed to order shifts from China and Bangladesh, driven by political instability and military conflicts.
With its strong potential driven by low labour costs, proximity to raw materials, and high productivity, Vietnam’s textile and garment sector is positioned to thrive. However, businesses must focus on finding reliable partners to secure quality supplies and explore new market opportunities.
For those looking to import garments from Vietnam, Vncommex offers accurate information and excellent support at competitive prices.
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