their own. Branding is becoming a key issue in the development of the textile industry in China today. Combined with the advantage of a huge domestic consumption market, many domestic textile companies in China that hold a large domestic market share have begun to cooperate with the world's leading famous fashion brands. Two forms of cooperation are taking place in parallel: Building a few new brands under the name of Chinese fashion, and at the same time developing as agents for those brands with existing famous brand names. These are measures to minimize risks and use costs effectively. By the end of 2005, Cartier plans to open 6 agency branches in China, in 2004 Prada opened 15, LV opened 13 branches. In addition, the Firs Group (USA), in collaboration with Chinese companies, has built 18 new brands for textile fashion products of this country, with a plan to build 30 brands by 2010 [28]. This group of products has begun to be exported abroad in limited quantities.
Currently, the model of “industrial linkages” in the textile industry is of particular interest to enterprises in China. These are areas where there are textile factories with different characteristics (in terms of production stages, products, etc.), but can meet the most diverse needs of consumers and customers for popular textile products, if they are reasonably linked together. Enterprises that have participated in these industrial linkages have seen the superiority of this form, when they become part of the industrial production chain, especially when an enterprise itself cannot carry out certain production stages or thanks to the linkage, they have reduced many costs. The Chinese government has planned to develop four such industrial linkage zones for the production of popular textile products: in Beijing, Shanghai, Shenzhen and Dalian. Other local regions are also planned to develop specialized products, for example Shengzhou and Huzhou supply 70% of children's clothing products; Guangdong specializes in children's clothing products.
export goods; Wenzhou and Ningbo specialize in producing daily and office clothes...
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For the international market, up to now, Chinese textile products are still known for their advantages of low prices and diverse designs, however, their quality is low, there are almost no sophisticated stages of the products, and the market segment of the products is not high, mainly meeting popular needs, supplying goods to supermarkets and large fashion stores, not meeting the requirements for high-tech products, small production quantities, the needs of small stores, and special needs.
2.5.2. The Indian model
The Indian textile industry has developed quite strongly, based on the prosperity of the country's textile industry. India is one of the few countries in the world that has established a textile industry from the beginning with all stages and stages of the production process, from raw material production, to product design, cutting and sewing and processing into finished products.
The development model of the Indian textile industry includes two basic points: the effective operation of the horizontal chain system and the product diversification policy, originating from the domestic market.
The system of operation of the horizontal chain is built on the foundation of a highly developed textile industry. Although cotton still accounts for 58% of the textile raw material market, India has invested in diversifying its raw material market over the years: synthetic fiber raw materials, such as polyester, viscose, acrylic, etc., account for about 39% of the consumption market; natural fiber raw materials, such as silk, wool, linen, etc., continue to receive attention and development. In fact, many Indian enterprises have built a global consumption system, even for items that are not traditional products of this country, for example, the Aditya Birla Group is currently the world's largest supplier of viscose fiber (artificial linen) related products.
The development model of the Indian textile industry gives special priority to the group of small enterprises and households, because the nature of textile products in this country requires a high proportion of manual labor. Workers in this industry are considered artisans. Although today the increase in modern automated technology and mass production in products has become increasingly higher, skilled and sophisticated labor is still one of the advantages of this industry in India compared to other countries in the world. Enterprises and large corporations, from 1960 to the early 90s, were not favored by the state in textile industry development policies. While all production stages that create high added value for products belong to large enterprises: design techniques, fashion, product development, branding and consumption capacity as well as supply. To change the state of this industry, after 1990, along with the opening of the economy, the Indian government has paid attention to developing the textile industry in depth. The emergence of a series of large companies in the field of fashion products has created new competitiveness for Indian textiles in the market, based on strong, widespread development including hundreds of stages, carried out by the system of small businesses built over 3 decades.
Today, customers around the world can easily recognize the characteristics of Indian textile products: although produced on a large scale; modern, fashionable designs; diverse product types with many different types of materials; these are still highly handmade products, requiring skilled, sophisticated labor.
Product diversification is also one of the important policies of the textile industry. Meeting domestic demand for traditional textile products for men and women, sportswear, winter coats, popular products of the textile industry, children's clothing, and all other products for all ages. In addition, household textile products (curtains)
Textile products (fabrics, bed sheets, towels, kitchenware, etc.) and industrial garment products (industrial canvas, car hoods, etc.) are also widely produced in India. To meet the maximum domestic market, with limited imports, the export turnover of this industry in India is currently about 15 billion USD. The expected target for 2005 is more than 20 billion, and by 2010, the Indian textile industry will reach 85 billion USD, of which about 45 billion is from the domestic market, the remaining 60% is the export turnover of the textile industry [28].
2.5.3. Thailand's model
The Thai textile industry plays an important role in the economy, currently creating about one million jobs each year. Textile products account for the largest proportion of export turnover, in 2002 it was 2.9 billion USD [28].
Thailand's textile industry has a 40/60 ratio between weaving and sewing. Most of the current textile and garment export products are still made in the form of processing: customers design the models and directly provide raw materials for the products. The cost structure of the products of this industry: raw materials account for 65%, labor 20%, and other costs such as machinery depreciation, fuel and energy account for about 15%. 60% of the textile and garment industry's production capacity is for export, including both high-end and low-end market segments. The model of Thailand's textile and garment export industry is to process for foreign companies under their product brands. To produce for export, Thailand imports most of the raw materials, semi-finished products of high quality raw materials that domestic production capacity has not yet met. In general, the production process requires a large number of workers, especially in cutting and sewing. Outdated machinery and technology with limited research and development of new products. The Thai textile industry is based on mass production with large orders at low prices. Thai textile products are largely unbranded and unnamed. Most
Production capacity is small and medium enterprises with simple technical machinery systems.
2.5.4. Lessons learned for Vietnam
Firstly, increasing investment is the main solution to improve capacity, technical level and product quality.
More than ever, Vietnamese textile and garment enterprises are facing great difficulties; the domestic supply of raw materials is underdeveloped, the technology is still backward, there is still too much dependence on export processing markets such as the US and Europe, there are no big brands or input production factors such as electricity, water, and high communication costs compared to countries in the region... Market preparation and human resources for factory management and operation determine the success of investment projects. In addition, it is necessary to invest in the garment industry in the direction of structural transformation: modernizing a number of factories to shift production to high value-added products, improving market access capacity to gradually shift from processing to FOB, investing in new factories in towns and townships to transform the agricultural and rural structure.
Second, attracting investment, diversifying ownership and types of enterprises in the textile and garment industry.
To develop the Vietnamese textile and garment industry, the state needs to encourage all domestic and foreign economic sectors to invest through forms of business cooperation, joint ventures, associated companies, equitization of enterprises, enterprises with 100% foreign investment capital. Develop investment projects in the fields of weaving, dyeing, production of cotton and synthetic fibers, production of raw materials and accessories to attract investors; in which priority is given to projects producing woven fabrics to serve the production of textile and garment products for export. Develop concentrated raw material trading enterprises to meet the demand for raw materials and accessories for enterprises with high quality and reasonable import prices.
At the same time, build specialized textile and garment industrial parks with adequate infrastructure conditions for electricity supply, water supply, wastewater treatment, ensuring environmental requirements and trainable labor.
Third, develop supporting industries, increase added value of each product and build a separate brand for Vietnamese textiles.
The elimination of quotas since 2005 has paved the way for developing countries, which have many competitive advantages, to focus on developing the textile industry so that they can be proactive in all stages of the production process. The retail network is increasingly dominated by retail organizations in large consumer countries, where the trend is towards high product specialization, big branded products and market segments. Large retail groups collect market information on customer tastes, latest fashion trends and the aggregation of this information gives them advantages in dealing with their suppliers.
Choosing a suitable model for the Vietnamese textile industry, according to each stage of development, is extremely necessary at a time when this industry is facing many challenges worldwide as it is now. If we continue to develop spontaneously, Vietnam will follow the path of Thailand. While we have the advantage of large domestic consumption demand, highly skilled workers in the garment industry, and meeting small orders with high requirements for processing difficult details is also an advantage of Vietnam compared to China. Based on India's experience, we can implement that model for the Vietnamese textile industry, more specifically, in a direction that is suitable for current world trends and consumer needs. However, above all, there is still an objective requirement for developing a long-term textile and garment accessories industry, meeting domestic and export needs.
Fourth, develop “vertical” and “horizontal” linkages to enhance competitiveness for domestic textile and garment enterprises.
- Production linkage has not yet become an urgent need in the operations of Vietnamese textile and garment enterprises.
Even in a business, the need for economic linkage, if it does appear, only exists in the ideas of business leaders, and has not yet become a need of all members of the business. The reality of production and business management shows that it is the middle-level managers who most easily recognize the needs for linkage, and if they do not raise them, it will be difficult for the business owner to notice. Not to mention, if direct workers do not clearly perceive the benefits of economic linkage, then in their work, they will not thoroughly comply with the provisions of economic contracts, and thus will lead to low efficiency of the business when implementing economic linkages.
- The macro environment is not favorable for production linkage.
Economic linkages have long been mainly a process of self-mobilization of enterprises. The State has almost no specific mechanisms or policies to facilitate or encourage the development of economic linkages.
- On the business side, when there is a need to find a connection, but do not know where to look, because the information about the partner is sometimes incomplete or not reliable enough for the business to decide whether to connect with that partner or not. If auditing and information disclosure activities are conducted regularly, it will also be a way to help businesses have the conditions to find information about their partners more effectively.
- The capacity of Vietnamese enterprises to connect is still limited, which is reflected in the low reputation of enterprises, not enough to attract other small enterprises to become their satellites. There are not many enterprises with sufficient capacity such as Lilama, Song Da..., making it difficult for economic connection relations to develop. Hopefully, with the emergence of some economic groups
such as Electricity, Coal and Minerals, Textiles..., economic linkages will have more favorable conditions to develop.
- The small size of the market, especially the export market, makes it difficult for businesses to carry out joint activities. However, this problem will soon be overcome when Vietnam has officially joined the World Trade Organization (WTO).
- The State's policy mechanism does not have many regulations related to promoting the development of economic linkages or if there are, they are difficult to put into practice due to the mentality of small-scale, fragmented production in many areas of the economy. This is clearly demonstrated in the implementation of Decision 80/TTg of the Prime Minister on economic linkages in the production and consumption of agricultural products.
- International economic integration both creates motivation and sets requirements for cooperation and production linkage of textile and garment enterprises.
In industrial production, horizontal and vertical linkages are increasingly tight. According to forecasts, with a wide contact area between countries, industries and enterprises thanks to the process of flattening the world, international production linkages will develop into a "matrix linkage" model. At that time, the requirement for high specialization, high sophistication will be a pressure on Vietnamese enterprises when technology, management level, human resources, finance and marketing activities are still too far behind those of developed countries.
In the context of WTO integration, multinational corporations will implement a new purchasing strategy, at which time the most important decision is not the decision to concentrate as Japanese enterprises have done, but enterprises from different countries will have more opportunities to become “satellites” in the global supply chain. This is the driving force and opportunity for the development of international production links in open conditions.
However, the deeper the integration, the higher the competition, and domestic enterprises need to be deeply aware and have a plan to prepare. Obviously, with