Ministry of Industry and Trade statistics show last year’s Vietnamese garment and textile exports to the US realised US$8.6 billion, up 14.2% from the previous year.
Especially, the US remains Vietnam’s largest export market for such items as footwear, handbags and suitcases with a total export turnover of US$3.46 billion, making up 33.6% of the sector’s total revenue.
The US is a highly lucrative export market for Vietnam businesses, said President of Sourcing at Magic, Chris Griffin who is also in charge of foreign customers of the Magic-Las Vegas Sourcing 2014 organizing board at a recent seminar discussing strategies to penetrate and expand to the US market.
The US is the world’s biggest consumption market for garment and textile exports, which currently stand at over US$100 billion per year. In 2013, the US economy encountered difficulties, leading to the fact that garment and textile exports to the market experiencing only a modest increase of 3.6% against 2012’s figure.
However, Chris Griffin said that, the US economy is recovering from the financial crisis in 2008. In the early months of this year, the US GDP rose by 3-4% while the securities market and consumer trust in the economy have also markedly increased.
“All of these positive signs will offer a good opportunity for Vietnamese businesses to penetrate the US market” he said.
Griffin compared the US market to the European and Japanese markets which also have been stagnant and in a crisis mode, but the US economy has turned the corner and is solidly on the rebound and gaining momentum.
US manufactures and retailers are actively searching for ways to reduce their dependence on China and are searching worldwide for alternative suppliers to replace China, which creates an excellent opportunity for Vietnam to find a niche in the US market added Mr Chris Griffin.
He articulated that China now takes is the leading exporter of goods into the US market. However, costs in China are increasing and this provides Vietnam is a perfect alternative option for US business thanks to its political stability, hardworking and responsible people.
For example, at the Magic-Las Vegas Sourcing fairs in the US, all major American importers were gathering at the Vietnamese pavilions expressing their viewpoints that Vietnam has a stable and competitive labour costs compared to other nations. In addition, Vietnamese exporters are interested in conquering the US market.
Chris Griffin noted that to expand exports to the US, local businesses should learn more about market differentiation according to age, style, price and quality and export goods through different distribution channels-retail, wholesale and agent.
Two potential distribution channels for Vietnamese businesses are wholesalers which own strong trademarks and major retail centres.
Ministry of Industry and Trade representatives suggested Vietnamese businesses should pay special heed to legal formalities and technical barriers in the US market if they want to achieve greater penetration.
Like Europe, the US requirements for footwear imports are becoming increasingly more difficult and complicated due to a series of regulations, strict requirements and security investigations that must be met.
Additionally, each state in the US has its own regulations and laws, so importers should pay attention to not only federal laws but also the laws of each state.
To enjoy sustainable exports to the US market, Griffin said that businesses should take care to join and become active participating members of US trade associations, to have the advantage of their expertise and technical support, and strictly comply with the demanding legal requirements of doing business in the US.