AM N SCA JURY GURNOOR KAUR

THAHLIYA ZUMEN C M
ASSIGNMENT DFT-VI
MEN’S ROUND NECK T- VIETNAM

SHIRT BANGLADESH
VIETNAM
•Marked by a heterogeneous landscape, Vietnam is the fifteenth most highly populated
country in the world.
•Viet Nam is located in the centre of Southeast Asia with a land area of 329,560 square
km, population density is 237.62 people /sq. km.
•It lies in the eastern part of the Indochina peninsula, bordered by China to the North,
Laos and Cambodia to the West, the East Sea and Pacific Ocean to the East and South,
and has a beautiful 3,260 km long coastline, an ideal position for the economic
development.
•Hanoi in the north is the capital of the country, and Ho Chi Minh City in the south is
the largest commercial city. Da Nang, in central Vietnam, is the third largest city and an
important seaport.
TEXTILE AND APPAREL INDUSTRY IN
VIETNAM - OVERVIEW

•Vietnam is the fourth largest exporter for textiles, garments and clothing worldwide after
China, the European Union and Bangladesh.
•In 2018, the apparel industry reached an export turnover of more than 36 billion U.S.
dollars, making it the third strongest export commodity in the country.
•In 2018, the manufacturing sector contributed 16 percent to the country’s GDP. Together
with more than 2.7 million people employed in the textile and garment industry across six
thousand textile companies, the sector is an important pillar in the country’s economy.
•Export turnover of Clothing and Textiles in Vietnam – 36.16 bn USD
•Share in Worldwide Clothing Exports – 6.2%
•Apparel Market Value in Vietnam- 2.57 bn USD
 GARMENT n TEXTILE EXPORT TURNOVER
30000

25000

20000

15000

10000

5000

0
2011 2012 2013 2014 2015 2016
NUMBER OF TEXTILE
ENTERPRISES IN VIETNAM BY
SECTOR
Apparel processing service - 5,101units
Fabric manufacturing - 780 units
Yarn and fibre manufacturing - 119 units
Total - 6000 units
MAIN MARKET AND
PRODUCTS
The products of Vietnam’s textile and garment industry
Categories of Apparel Products for export in
are sold in both domestic and foreign markets. 2012, 2013 and 2014 (%)

In the domestic market, they are sold in markets, retail

stores, supermarkets, trade centers and accounts for
about 14%.
The products of Vietnam’s textile and garment industry
are exported to more than 180 countries and territories
worldwide.
In particular, the main markets are the United States, the
EU, Japan, Korea, and some other markets such as
ASEAN, Canada, China, and Taiwan. Source : UN Comtrade, 2015
•Knitted garments typically include items such as
T-shirts, Polo-Shirt, Sweat Shirts and Sweaters.

•Woven garments are Trousers, Shirts, Jackets,

Skirts, Children wear, Dress, Blouses,
Underwear and Nightwear, Jeans Pants,
Sportswear, etc. are normally classified as
woven fabric based garments as they tend to use
more woven fabrics than knitted fabrics.

•For both types of garments, the US market is its

largest importer, with a particularly high share
in the export of woven fabric based garments.
BANGLADESH
•Bangladesh is located in South Asia and shares its borders with India and Myanmar
and impendence in 1971.
•It is the eighth most populous country in the world with a population density of
1,106 people per square km (2009 estimate).
•Over 50% of Bangladesh’s GDP comes from the services sector.
•Two-third of the country’s population is engaged in agricultural activities, with most
of them growing paddy.
•The Bangladesh economy is helped by its big readymade garment (RMG) industry
sector, which contributes more than two-thirds of the country’s trade.
TEXTILE AND APPAREL INDUSTRY IN
BANGLADESH - OVERVIEW

•RMG and Textiles industry has consistently been the key driver of Bangladesh
export for the last 4 years, covering over 80% of the total export.
•Hence, the industry has earned the third position in apparel manufacturing
globally and the leading position in South Asia. 
•Bangladesh exports a wide range of apparel products in North America, Europe,
Asian  and countries in many other geographic regions.
SHARE OF PRODUCT IN
EXPORT
Product Wise Share in Bangladesh Exports
•Generally, the export products can be
categorized into two major categories-
Woven and Knitwear.
•These two categories include a wide range
of products but the key products which
take up the majority of the product mix are
denim, shirts, trousers, sweaters etc.

Source : BGMEA
RAW MATERIAL VIETNAM
AVAILABLITY
FABRIC (COTTON)
● Domestic production of fabrics only
satisfies around 20% of the production
demand and therefore Vietnam has to
import fabric to meet 80% of the demand.
● The main fabric suppliers for Vietnam are
China, Korea, Taiwan and Japan,
accounting for 90% of market share.
● China is also the largest fabric supplier for
Vietnam over the years, contributing more
than a half of market share in 2017,
followed by Korea and Taiwan, with 18%
and 14% respectively. In contrast, fabric
from Japan only account for more than 5%
of total import
GARMENT ACCESSORIES/
TRIMS
•Vietnamese garment producers’ source all kinds of accessories through import.

•However, local backward linkage industries have also grown that can meet around
20%-30% of requirements.
•Currently, more than 21 accessories industries are in operation in Vietnam. Imported
items can be sourced locally.
•Vietnamese garment producers use high quality accessories like international brands
as YKK zippers, COATS (sewing thread), Kufner, Freudenberg and Vilene
(interlining).
RAW MATERIAL BANGLADESH
AVAILABLITY
FIBRE (COTTON)
•Bangladesh is almost entirely dependent on
imports to meet rapidly growing demand for
raw cotton.

•Domestic production of raw cotton can hardly

meet 2% of its demand of the country.

•More than 40% of raw cotton imports are

meant for the export oriented RMG sector.
YARN
•The cotton knitwear sector (raw cotton has to be imported) in Bangladesh shows an
almost complete value chain.

•Spinning, yarn dyeing, knitting and confection of knits and garment finishing are all
done in the country.
•The total demand for yarn is more than 2.1 MMT per year.
•Of the demand, 70 percent is met by local millers, while the rest is imported mainly
from India, China, Vietnam and Pakistan.
FABRIC (COTTON)
•Despite a remarkable growth in backward linkage industries, the country’s current
demand-supply gap of fabric is about 50 percent in terms of cotton-based uses and
around 25 percent in terms of non-cotton based uses in RMG sector.
•As the exports have increased in the knitwear sector, the capacity of backward
linkage has also gradually increased accordingly.
•The result is that local suppliers can provide 90% of the total fabric requirement of
the knitwear sub-sector sector.
GARMENT ACCESSORIES/
TRIMS
● Bangladesh is already well established as a
sourcing center for garments products and
accessories

● Bangladesh is producing and exporting

accessories like woven labels, leather
badges, stone and metal motifs, rubber
patches, gum tapes, satin and cotton ribbon
hangers, price tags, buttons, zippers etc.
● In the RMG sector, the accessory makers and packagers supply more than 34 types of
products with proper policy support and financial incentives.

● Garments Accessories and Packaging (GAP) sector earned valuable foreign exchange to
the tune of US$ 7.10 billion during the financial year 2017-2018.

● Out of them, US$1.12 billion is exported directly to Middle-East, South Africa, Sri Lanka,
Malaysia, Europe, Vietnam, Cambodia, and Laos etc.

● Currently, around 1,700 factories are producing accessory items in the country, mostly in
compliant factories along with 100 new factories those have started their operations this
year.
FABRIC AND TRIM SUPPLIERS
IN VIETNAM
FABRIC SUPPLIERS TRIM SUPPLIERS
● Esprinta (Vietnam) Co., Ltd. ● Hana Kovi Inc.
● Hansae Vietnam Co., Ltd.
● Duc Phat Accesories
● Thanh Cong Textile Garment
Investment Trading Joint Stock ● Song Nian Ltd
Company
● Sam Om Co., Ltd
● Damco International B.V
● Khai Minh Global Co., Ltd. ● MeKong Garments
● Opus One Corp.
● Han Sung Vina Co., Ltd.
● Alim Hanoi Co., Ltd.
● Vinh Thanh Garment Export Co.,
Ltd
FABRIC AND TRIM SUPPLIERS
IN BANGLADESH
FABRIC SUPPLIERS :-
● Alhaj Textile Mills Ltd
● Anlima Textile Ltd
● DIRD Garments Ltd
● Regent Textile Mills Limited
● ACS Textiles & Towel (BD) Ltd
● Knit Asia Limited
● Pearl Garments Company Limited
TRIM SUPPLIERS :-
● Natex Thread & Trims
● TRIM LABEL LIMITED
● Trims Power And Fire Ltd.
● SHINING MOON TRIMS LIMITED
● Es-Trims In Corporation
● SHINING MOON TRIMS LIMITED
● Tex- Trims & Packaging
LABOR COSTS AND
CMT
LABOUR COSTS AND CMT
The current minimum wage for garment
workers in Vietnam ranges from
125USD to 180 USD per month while
the minimum wage in Bangladesh is
only around 95 USD per month.
● CMT costs for some garments :-

VIETNAM BANGLADESH

CATEGORY CMT/Piece CATEGORY CMT/Piece

Knit T-shirt $0.40 T-shirt $0.2- $0.3
Trousers $1.20 Polo Shirt $0.4
Jacket $7.00 Flannel shirt $6.00
LEAD TIME
BANGLADESH
•For woven garments, the production lead time based on locally sourced raw
materials ranges from 90-120days.

•However, it is much lesser in case of knitwear exports since Bangladesh has full
range of backward linkage supports except raw cotton.

•Again, if the garment is produced using imported raw materials the production lead
time is at its higher level i.e. 120 days.

•Factories sometimes fail to meet the shipment deadline due to uncertain situation
like labor unrest, lower productivity and weak sourcing and management practices
and eventually, they avail air shipment at a higher cost.
VIETNAM
•The production lead time of garment based on locally sourced raw materials is about
65-90 days.
•If the garment is produced using imported raw materials the production lead time is
reduced by 35-30 days.
•Lead time increases since the local textile industries normally take longer time to
deliver the desired quality of fabrics.
•It takes 5–30 days to produce required quality of fabrics by the local textile
industries.
•Only 20% locally produced fabrics are of good quality and roughly, 30% of the
required accessories are produced in Vietnam that include thread, cartoon, poly bag,
labels, button, zippers, interlining, etc.
MOQ - MINIMUM ORDER
QUANTITY
● The MOQ in Vietnam garment industry is typically around 1000
pieces per style per color.

● On the other hand , in Bangladesh , their standard order size is at

least 5000 pieces per style.
SUPPLY CHAIN COMPARISON
The supply chain of textile and garment industry of Bangladesh is different from that of
Vietnam due to a few specific characteristics as mentioned below:
• In Bangladesh, there is no state-owned enterprise any more, however, in Vietnam state
owned enterprises are also involved in the textile and garment sector. However, 30 years back
Bangladesh did have state owned textile mills
• The textile and garment industries in Bangladesh are mostly operated by the local owners
and a small number of joint ventures are there.
• 100% locally owned enterprises are large in number. Only a few 100% foreign owned
enterprises
• Joint venture investment does not even exist more than 12-15 units
• Dyeing, printing and finishing sub-sector is stronger in Bangladesh that Vietnam
• The accessories industries in Bangladesh for textile and garment sector has grown
enormously
• On-going initiatives are there building capacity for designing and product diversification
BANGLADESH VS SUMMARY
VIETNAM
 BANGLADESH VIETNAM
POLITICAL STABILITY Unstable, spl during elections Stable

FREE TRADE AGREEMENT EU (GSP) USA

SHIPPING TIME (EU via 30-35 days 28 days
REFERRENDUM)

E&S COMPLIANCE RISK (formal std) High, low implementation rate Medium- low

MINIMUM WAGE (labour) $95 $140

AVAILABILITY OF SKILLED LABOUR Good availability of basic Good availability of workers
skilled workers and low skilled
mgmt.

AVAILABILITY OF FABRIC AND Locally produced, increasing Imported

TRIMS availability
 BANGLADESH VIETNAM

ASSORTMENT OF PRODUCT Knitwear, denim, jersey, Knitwear, denim, jersey,

AVALABILITY children’s clothing, woven, top children’s clothing, woven, top
and bottoms and bottoms

CURRENT LEVEL OF Growing Low

TECHNOLOGICAL
INNOVATION

POTENTIAL FOR LARGE High High

ORDER SIZES

POTENTIAL FOR SMALL Small, due to focus on high qty Small, due to focus on high qty
ORDER SIZES

POTENTIAL FOR VALUE Low-medium Low-medium

ADDED PRODUCTION
STRENGTHS AND
OPPORTUNITIES
VIETNAM
● With abundant and skillful labors at relatively low cost, Vietnam textile and
garment enterprises can produce complicated styles high quality, high value
added and branded products.
● Products quality and orders implementation capacity have improved and thus
able to attract foreign customers i.e. big importers and retailers
● Vietnam ranked within top 10 biggest textile and garment exporters in the world
● Increased trend of relocation of textile and garment production from developed
countries such as Taiwan, Korea to Vietnam and thus attracts capital, technology,
management experience to develop textile and garment industry.
● Vietnam is close to the main fabric and accessory sources in the world.
● Vietnam is appreciated as a stable political and safe social destination, attracting
businessmen and foreign investors.
BANGLADESH
● Competitive price-performance ratio (low production costs, basic experience regarding
international quality standards, up-to-date technical equipment)
● Local availability of yarns for knitwear and trims & accessories.
● Good potential for development of competitive advantages for garment manufacturers e.g.
concerning productivity, quality control, product development, customer service and
management
● Increased market access upon inclusion of new countries who signed Bilateral Trade
Agreements
● Increase of potential, attractiveness and positive image of Bangladesh and its RMG sector
as a production and investment location for international customers/investors.
● Potential for higher value addition provided appropriate steps concerning the development
of the spinning and weaving sector are being taken and productivity increases among the
manufacturers (higher flexibility, higher self sufficiency, extension of capacity and quality
improvement without additional investments into machinery).
CHALLENGES FACED BY
THE TEXTILE AND
GARMENT INDUSTRY
VIETNAM
● Seaport is over utilized and limited warehousing facility cannot accommodate a
large quantity of export items to be shipped
● Bribery and toll collection exist while the goods are transported for export
destination through seaports or airports
● Textile backward linkage industry are still not very developed, 70% of raw
materials are imported from abroad, resulted in inactive production and limit the
quick response ability.
● Labor productivity is low compared to China, and products are not diversified.
● Many enterprises haven’t paid proper attention to building up long-term
development strategy; as a result, the stable development is limited.
● Most of enterprises are in small and medium size (SMEs) with low investment
capital mobilization and limited ability of innovating technology and equipment.
● Human resource training of middle and high class management, technology, and
fashion design are weak.
● Marketing and trade promotion are limited, fashion design, building up and
developing trademark are not much cared
● More trade and technology barriers such as the regulations of chemical safety
product law, import monitoring programs given by import countries, created
difficulties and higher cost for the suppliers.
● International competition, especially from powerful textile suppliers such as
China, India and Bangladesh are getting severer and severer.
BANGLADESH
● Insufficient and interrupted supply of power and lack of new gas connection for
industries
● Weak physical infrastructure
● Congested roads and lack of enough number of highways, flyover and
expressway. Huge traffic congestion within the capital city slows down
movement of human and goods
● Minimum wages crisis and increased frequency of labor unrest severely hampers
production
● Frequent interruption of power causes huge wastage of materials and workers’
working hours
● Limited seaport facilities
● Threats of environment pollution discourage new investment in dyeing and
finishing units
● Bangladesh still lacks qualification structures in particular regarding:
production efficiency, quality standards, product development, proper use of
existing technical equipment, marketing skills, customer service and
management, acquisition, financing, controlling, planning and management
skill
● Insufficient domestic woven fabric supply thus necessitates fabric imports
● Generally poor independent marketing/sales by garment companies.
● Difficulties of adaptation for different international corporate and social
standards.
● Unbalanced image of RMG sector (only simple products, no high quality
value-added items)
 INITIATIVES TAKEN BY
GOVERNMENT TO SUPPORT
TEXTILE AND GARMENT SECTORS
VIETNAM
● To overcome the high cost of raw materials, the government had started
Investment plans in this segment long back. As a result, in 2006-2015 , the
country became the second biggest investor in the development of shuttle less
looms and the biggest investor in ring spindles and poen end rotors, amongst the
ASEAN countries.
● The government has given a push to enhance value-adding capabilities of the
Apparel manufacturers, develop their own brands, become original design
manufacturers (ODMs) rather than function only as subcontractors.
● With the establishment of cotton manufacturing units in “Rang Dong Industrial
Park” having a production value of US $3 billion on an annual basis, the country
has shown a remarkable growth in knitting sector.
● Other incentives :-
Local garment and textile industries are entitled to get refund of value
added tax
Zero duty on importation of capital machinery and equipment for
textile and garments industries
Investment incentives to the enterprises that produce equipment and
machinery for the textile and garment industry
Investment incentives involved in production of weaving fabrics,
completing textile products; producing silk and fibres of various kinds.
Investment incentives to the garment and textile industries those
regularly employ 500 to 5,000 employees.
Investment incentives to the enterprises producing waste treatment
equipment for textile and other industries
BANGLADESH
● Garment Palli - Bangladesh Garment Manufacturers and Exporters Association
(BGMEA), the apex body of the export oriented garment sector has decided to establish
a combined garment park which will welcome the local and foreign investors to
establish industries to production unit of a complete value chain- from raw material
sourcing to the shipment level named as “the Garment Palli”.

● Knit Village - Bangladesh Knitwear Manufacturers and Exporters Association

(BKMEA), the apex body of the export oriented knitwear industries undertook a project
to set up “Special Economic Zones for Knit Sector titled “Knit Village”, which will
locate all related industries within one boundary with its own power plants, waste water
treatment plants, Inland container terminal, bonded warehouse, etc. Currently,
International Finance Corporation Dhaka Office in collaboration with BKMEA is
undertaking pre-feasibility study to set up Knit Cluster, where the author is a leading
expert.
● Liberalizing Power sector for the Private Investment - The Government of
Bangladesh has taken legislative and regulatory decisions to allow establishing
private power plants under public private partnership (PPP) concept in order to
attract local and foreign investment to face the crying need of electricity in the
industrial sector especially the textile and garment industries. Any industrial park
can have its own power plants.

● Training and Capacity Building of NITRAD - Bangladesh Textile Mills

Association (BTMA), the apex body of spinning and textile industries has taken
over the training institute i.e. NITRAD from the Government of Bangladesh in
collaboration for training and capacity building of textile and garment workers.

● National Social Welfare Committee - The Government has recently formed

“National Social Welfare Committee” under the Ministryof Commerce in order to
promote the living standard of the employees especially in the textile and
garments industry sector.
GARMENT COSTING ROUND NECK T-SHIRT
 VIETNAM - BILL OF MATERIAL
MATERIAL DESCRIPTION QUANTITY UNIT OF UNIT AMOUNT
REQUIRED MEASURME PRICE (USD)
NT (USD)
FABRIC Single jersey knit fabric, 100% 1.3 Meter $2.09 $2.72
cotton, width-60”, GSM-150
NECKBAND ½” rib, white colour, Material- 0.74 Meter $0.10 $0.074
cotton, Supplier- NSK Textile,
Vietnam
SEWING Type- Spun yarn count- 60s, Colour- 102 Meter $0.01 $1.02
THREADS white, Material- Polyester, Supplier -
Global Weaving Joint Stock
Company, Vietnam
BRAND AND Woven, Material- Satin, Supplier- 1 piece $0.01 $0.01
SIXE LABEL Song Nian Ltd, Vietnam
CARE LABEL Woven, Material- Satin, Supplier- 1 piece $0.01 $0.01
Song Nian Ltd, Vietnam
TOTAL $3.83
 BANGLADESH - BILL OF
MATERIAL
MATERIAL DESCRIPTION QUANTIT UNIT OF UNIT PRICE AMOUNT
Y MEASURME (USD) (USD)
REQUIRE NT
D
FABRIC Single jersey knit fabric, 100% cotton, 0.19 Kg $6.88 $1.307
width-72”, GSM-130, Yarn count- 40*40,
colour- white, Supplier- World Mark,
Bangladesh
NECKBAND ½” rib, white colour 0.74 Meter $0.13 $0.096
SEWING Type- Spun yarn, count- 60s, Colour- 102 Meter $0.0029 $0.296
THREADS white, Material- Polyester, Supplier-
Brother’s Garment, Bangladesh

BRAND AND SIXE Woven, Material- Satin, Supplier- Texus 1 piece $0.12 $0.12
LABEL Accessories Ltd, Bangladesh

CARE LABEL Woven, Material- Satin, Supplier- Texus 1 piece $0.12 $0.12
Accessories Ltd, Bangladesh

TOTAL $1.723
 COST SHEET COMPARISON
PARTICULARS BANGLADESH VIETNAM

Total Direct Material cost $1.72 $3.83

Direct Labour (CMT) $0.2 $0.4

Packaging cost $0.10 $0.08

Overhead cost $1.21 $0.70

Garment Cost/Piece $3.24 $5.01

BIBLIOGRAPHY
https://www.btmadhaka.com/
http://www.vietnamtextile.org.vn/search_p1_1-1_2-2_3-205_15-125_17-s2.html
https://www.statista.com/topics/5820/apparel-industry-in-vietnam/#:~:text=Vietnam%20is
%20the%20fourth%20largest,export%20commodity%20in%20the%20country
https://www.vietnamtrades.com/vietnam-import-data/single-jersey-fabric.html
https://m.alibaba.com/product/169664279/Label.html
https://www.vietnaminsider.net/resources/manufacture-clothing-in-
vietnam.html#:~:text=MOQ%20is%20the%20abbreviation%20for,very%20important
%20to%20a%20factory.&text=To%20manufacture%20clothing%20in%20Vietnam%20you
%20need%20to%20meet%20the,pieces%20per%20style%20per%20color
https://www.textiletoday.com.bd/garments-accessories-packaging-entrepreneurs-focus-bran
ding-sector/
https://wits.worldbank.org/CountryProfile/en/Country/VNM/Year/LTST/TradeFlow/Export/
Partner/by-country/Product/50-63_TextCloth