Successive “shocks” have hit the global market, directly affecting export-oriented enterprises. Amid continuous challenges, Vinatex and its member units are striving to implement key measures in order to respond flexibly to market volatility, minimize risks, and maintain stable production and business operations under “normal” conditions.
Mr. Nguyen Hung Quy – Executive Director of Vinatex and General Director of Vinatex Southern Textile and Garment Corporation Co., Ltd. (VSC)
Amid the global energy crisis and increasing market volatility, customers have become more cautious in placing orders, with order information arriving more slowly and, in some cases, orders being reduced or canceled altogether. Total order volume in the second quarter is forecast to decline by 20–25% compared to the same period in 2025.
In addition, supply chain disruptions continue to pose challenges, with imported raw materials and accessories from China showing delays of one to three weeks, continuously affecting factory production schedules. As a result, enterprises are being forced to accelerate production and organize overtime production to meet deadlines as delivery times are shortened and production plans must be adjusted constantly. In terms of pricing, customers continue to tighten purchasing conditions and demand highly competitive prices, leading to an expected decline in profit margins during the second and third quarters.
To respond to this situation, VSC is focusing on customer and market development. The company aims to reduce dependence on the U.S. market by proactively expanding into the EU, the UK, and Japan. At the same time, VSC plans to develop an additional one to two new customers as a backup source to offset potential order reductions or shortages.
The company is also concentrating on revenue growth and cost control, with the goal of securing one to two additional FOB customers in 2026 (to increase the proportion of FOB orders in order to enhance added value and operational autonomy. However, close attention is being paid to controlling risk factors such as raw material price fluctuations, payment terms, and customers’ financial capacity); maintain regular communication with existing customers and closely monitor their business conditions and order trends.
The factories have also activated flexible production management models. They are closely monitoring the synchronization of raw materials and accessories, while keeping track of production conditions in order to proactively adjust plans and minimize additional costs. Supply sources are being diversified to reduce dependence on any single market, while localization rates for raw materials and accessories are gradually being increased whenever conditions allow.
At the same time, enterprises are maximizing the application of initiatives and process improvements to reduce production time and enhance line efficiency. Strong emphasis is being placed on cost control and energy optimization through reviewing and eliminating unnecessary expenses; optimizing raw material consumption standards. Companies are also investing in energy-saving equipment, improving production processes to reduce energy consumption, and negotiating with suppliers to stabilize input prices.
With these short-term solutions in place, the factories have managed to control and restrain rising costs, particularly in electricity expenses, raw materials and accessories, and administrative costs. Receivables have been closely monitored and thoroughly resolved, preventing outstanding debts from accumulating in recent periods.
Labor productivity has generally shown improvement compared to the same period last year. However, during March, there were signs of a relative decline, mainly due to delays in raw material supplies, changes in orders, reduced order volumes, and the continuous replacement of supply sources.
During this period of continuous volatility, in order to maintain workforce stability, VSC has implemented policies that harmoniously combine employee welfare support, productivity incentives, and labor discipline maintenance.
The company has established flexible productivity-based bonus mechanisms linked to actual performance (such as line bonuses for exceeding production targets). It has also invested in upgrading working conditions, improving the quality and nutrition of employee meals, especially during periods of accelerated production.
Regular dialogue sessions are organized to ensure transparent communication so that employees can better understand the company’s situation, share difficulties, and work together with the enterprise. Internal welfare programs, employee support initiatives, and assistance for workers facing unexpected hardships are also being implemented.
At the same time, VSC is strengthening vocational training programs to improve workers’ skills and help them adapt to new production requirements. Innovation and improvement initiatives are encouraged through timely recognition and reward mechanisms, while maintaining strict compliance with workplace discipline and labor regulations.
Mr. Nguyen Ngoc Binh – General Director of Hoa Tho Textile Garment Joint Stock Corporation (Hoa Tho Corporation)
At Hoa Tho Corporation, production activities remained stable during the first quarter of 2026. Factories across the entire Hoa Tho system continued operating normally, continuously, and without disruption, while production capacity, workforce availability, and operating conditions were all maintained. Order conditions and production organization also remained stable and aligned with the planned targets.
Fully aware of the potential indirect risks that may arise, Hoa Tho Corporation has proactively implemented the following key solutions:
-Closely coordinating with partners and customers to monitor market developments, especially fluctuations in fuel and logistics costs, in order to promptly develop and implement appropriate response measures;
-Proactively preparing production plans and raw material supplies to ensure continuity and on-time order fulfillment;
-Strengthening cooperation with transportation and logistics partners while diversifying transportation options to minimize risks and optimize costs;
-Proactively negotiating with shipping lines and traditional raw material suppliers to adjust prices for goods, transportation, and related services in line with actual market conditions while ensuring balanced benefits for all parties;
-Flexibly adjusting production plans to improve responsiveness to delivery schedules;
-Strengthening cost management across the entire system by promoting cost-saving measures, optimizing the use of raw materials and energy, and improving operational efficiency.
Amid increasingly complex fluctuations in global fuel prices, and in an effort to share difficulties and ease commuting cost pressures, Hoa Tho Corporation has implemented a practical support policy for employees. Under this policy, each employee receives a transportation fuel allowance of VND 200,000. The total amount allocated for this support program exceeded VND 2.2 billion. Although the amount may not be substantial, Hoa Tho believes that, through this spirit of support and solidarity, employees will feel more secure in staying committed to their machines, production lines, and standing by the company through difficult market conditions.
Mrs. Nguyen Hong Lien – General Director of Hue Textile Garment Joint Stock Corporation (Huegatex)
Facing the slowdown and sharp fragmentation of the global textile and garment market since the beginning of the second quarter of 2026, Huegatex has activated a flexible response strategy, positioning cost management and quality control as the central pillars of all production and business activities. Actual data from Huegatex reveals a paradoxical trend: while orders for basic products have declined sharply, demand for technically complex product lines has continued to increase.
For the Yarn sector, transactions in several traditional markets have slowed down. However, stronger growth has been recorded among FDI enterprises and in several neighboring countries within the region, particularly for value-added yarn products such as compact yarn and recycled yarn. These product lines offer more stable profit margins and face less competition from low-end market players.
Currently, yarn product prices have shown a noticeable upward trend due to increasing market demand. However, enterprises need to exercise tighter control when facing short-term “surges” in demand, as this can also become a pricing risk given the rapid fluctuations in the raw material market. Such volatility may lead customers to request price renegotiations or even postpone or cancel orders.
Huegatex therefore avoids committing excessively large volumes to any single customer in order to minimize risks related to order cancellations or price pressure during market fluctuations. Orders are divided into smaller volumes for traditional customers with strong payment credibility, while new customers without established transaction histories are limited as much as possible during periods of market instability. The company also carefully calculates cotton and fiber purchasing plans, selecting appropriate purchasing periods and avoiding excessive volume commitments beyond actual production capacity in order to mitigate risks.
For the Garment sector, orders for basic product lines have shown a downward trend, while demand for products requiring more sophisticated sewing techniques has increased. Customers are currently prioritizing orders that can meet stringent standards for sustainable materials.
Another notable market trend is that large-volume orders with fast delivery requirements are shifting strongly to Vietnam from lower-cost markets such as India and Indonesia, which have faced difficulties in ensuring delivery schedules and quality standards. This could become a long-term trend, creating opportunities for garment enterprises to capitalize on throughout 2026.
For Huegatex, the company currently has secured orders through the end of June, while some units have already signed orders extending into July and August. Transaction prices for CMT orders have improved considerably. However, on the other hand, FOB orders are facing shrinking profit margins due to rising costs of raw materials and transportation.
As a result, for long-term FOB contracts, Hue Textile Garment has been implementing early yarn price locking strategies to secure input costs for greige fabric production and avoid risks from continuously fluctuating yarn prices. Dyeing processes are only carried out close to delivery dates based on final order specifications, helping maintain color flexibility in line with market trends while reducing the risk of unsold finished-goods inventory.
At the same time, the company leverages its advantages in productivity and quality to renegotiate better processing prices, ensuring stable cash flow across the system. Hue Textile Garment also avoids accepting orders beyond its production capacity in order to minimize the risk of cancellations if market conditions suddenly reverse.
Facing the risks of soaring shipping costs and container shortages, Huegatex has proactively shortened booking timelines and arranged production schedules more flexibly, as current vessel booking conditions only allow bookings within a maximum of four weeks prior to the expected shipment date. The Yarn sector is concentrating on markets close to Vietnam such as China, South Korea, and Japan, while temporarily suspending exports to distant markets where maritime transportation risks have exceeded controllable levels.
Huegatex believes that this is a crucial period for strengthening forecasting capabilities. Closely monitoring actual customer behavior enables enterprises to proactively improve governance, adjust production plans, and enhance competitiveness in an increasingly challenging market environment.
Mr. Doan Minh Duc – Deputy General Director of Nha Be Garment Corporation Joint Stock Company
Amid the global energy crisis and ongoing market instability, Nha Be Garment Corporation is facing several direct challenges. Rising input and operating costs are placing significant pressure on profit margins, while partner requirements are changing rapidly, particularly regarding increasingly urgent delivery deadlines. Intense competitive pressure requires the company to maintain maximum flexibility in reallocating machinery and shifting production among different product lines in order to avoid order cancellations.
To remain resilient amid market volatility, Nha Be Garment Corporation has implemented a highly pragmatic operating strategy built around several key pillars:
Efficient management and cost savings: Applying strict cost-saving measures across all stages, from production preparation to rigorous quality control in order to prevent defective or damaged products. Each production step is optimized (for example, reviewing the entire sewing process of a garment to eliminate unnecessary operations).
Pioneering the application of AI and robotics: Accelerating automation to reduce dependence on manual labor. Nha Be Garment has introduced robots into technically demanding production stages while maintaining the goal of “keeping revenue stable even if workforce headcount is reduced by half.”
Organizational restructuring: Strongly restructuring the workforce by increasing the proportion of direct labor (from 60% to 80%) while reducing indirect labor in order to optimize actual productivity.
Market flexibility: Focusing on technically challenging, high-value, small-volume orders to minimize risks rather than pursuing large-volume orders that are more vulnerable to market fluctuations.
Thanks to these decisive measures, Nha Be Garment Corporation achieved positive results in the first quarter of 2026, with revenue increasing by approximately 10% and profit exceeding the annual plan by around 19%. Effective management helped offset rising operating costs. The company has maintained its position in the U.S. market, which accounts for 60% of its business, while also expanding into the EU, Japan, and China. Forecasts indicate that growth in the second quarter is expected to remain stable before the company faces greater challenges in the final months of the year.
Alongside efforts to improve productivity, Nha Be Garment places strong emphasis on protecting employee rights and supporting workers’ livelihoods. The company evaluates annual cost-saving performance to provide bonuses for employees, prioritizing direct labor workers with additional rewards equivalent to 0.5–0.8 months of salary added to monthly income. Transportation support allowances ranging from VND 200,000 to 300,000 per employee have also been provided to help workers cope with rising living costs. In addition, the company continues investing in modern equipment and the latest machinery to reduce the intensity of manual labor while simultaneously improving workers’ skills through the operation of advanced technological systems.
Mr. Vien Minh Dao – Member of the Members’ Council and General Director of Det 8-3 One Member Limited Liability Company (Emtexco)
The energy crisis and market volatility are placing increasing pressure on businesses, driving logistics costs up by nearly 20% and creating risks of supply chain disruptions. Fluctuations in global commodity prices have also intensified inflationary pressure, reducing purchasing power and increasing financial costs for Det 8-3 One Member Limited Liability Company in recent periods. Average interest rates have risen by 56%, from 4.8% to 7.5%.
Since the increase in logistics costs mainly comes from domestic transportation expenses (from factories to ports), Emtexco has sought additional supply sources to optimize costs as much as possible. Concerned about the prospect of rising international freight rates, the company has accelerated productivity to the maximum feasible level, balanced production orders, and prioritized orders with distant delivery destinations in order to ship products to customers as early as possible. The company is also carefully calculating production volumes so that bookings can be secured early, helping maintain stable freight rates and ensure shipping space availability.
Amid the global energy crisis, customers are also placing increasing pressure on enterprises regarding delivery schedules in order to secure production materials. In some cases, to ensure timely fulfillment for customers, Emtexco has had to arrange partial shipments. Instead of waiting until enough goods are available for 3 containers, the company may ship immediately once a single container is filled. Although this approach may increase documentation costs, it ensures the earliest possible delivery and accelerates cash flow recovery.
The pressure for earlier deliveries has pushed operating efficiency to its maximum level, with daily output increasing from 36 tons to more than 36.5 tons per day, reaching 1,139 tons in March 2026. The demand for fast deliveries has also helped minimize the company’s inventory levels. As of March 31, 2026, Emtexco’s inventory stood at only 240 tons, equivalent to just over six days of production, thereby significantly reducing inventory-related interest expenses.
In addition to encouraging employees to improve productivity, Emtexco has implemented transportation fuel support for workers since March 2026, increasing the allowance from VND 12,000 per person per day to VND 22,000 per person per day in order to support employees through difficult conditions during this period of broader economic crisis.
Mr. Pham Ngoc Binh – Deputy Director in Charge of Vinatex Nam Dinh Spinning Factory
Under current conditions, enterprises are facing dual pressures. On one hand, the global recovery in purchasing demand remains slow, while consumer spending continues to be cautious. On the other hand, according to the International Energy Agency, the Middle East conflict beginning on February 28, 2026 has caused the largest disruption in the history of the oil market, significantly reducing energy flows through the Strait of Hormuz and cutting global LNG supply by approximately 20%. Meanwhile, the United Nations Conference on Trade and Development reported that traffic through the Suez Canal remains about 70% lower than 2023 levels, resulting in longer transportation routes and sharply fluctuating ocean freight rates.
For manufacturing enterprises, these developments have translated into very tangible pressure on electricity costs, fuel expenses, logistics, working capital, and the ability to finalize selling prices. For Vinatex Nam Dinh Spinning Factory in particular, the impact is clearly visible in its supply chain and order schedules. Immediately after oil prices exceeded the threshold of USD 100 per barrel, all transportation providers announced increases in local charges ranging from 27% to 32% compared to rates before March 8. Other auxiliary material costs also rose by 12–15% depending on location, while notices stated that price adjustments could be implemented on a daily basis.
Customers have demanded immediate delivery of orders, and some have even requested revisions to contract terms in order to receive goods earlier and reduce the risk of transportation-related price increases. Customers in Pakistan have refused to accept additional transportation surcharges under wartime conditions. Selling prices are therefore required to include freight and insurance costs up to the agreed destination port or border gate.
To respond to the above situation, Vinatex Nam Dinh Spinning Mill has implemented several key measures: Maximizing manpower and backup materials to maintain machine operations and push production efficiency to the highest possible level in order to shorten delivery times for customers; Proactively booking shipping schedules early to lock in freight rates; Maintaining continuous communication with customers regarding cost adjustments so they remain informed. However, for signed orders, the factory remains committed to delivery without increasing prices;
Purchasing additional raw and auxiliary materials with fixed prices and confirmed delivery schedules to reduce risks if oil prices continue rising. Inventory reserves have been increased from 15 days to 30 days of production; Continuously monitoring market developments to implement timely solutions for securing key raw materials such as fiber and cotton, ensuring supply continuity without disruption; Developing production plans based on various cost increase scenarios in order to prepare specific response measures; Strengthening inspection and control activities to prevent unnecessary waste of electricity, water, and auxiliary materials.
As a result, Vinatex Nam Dinh Spinning Factory has been able to ensure delivery schedules in accordance with customer requirements without having to revise contract terms or change delivery timelines. Key raw materials have also been secured sufficiently for the next three months of production, including two months of reserve inventory and three months allocated for transportation lead time. In addition, production costs have remained within the contingency ranges previously calculated by the factory.
With the aim of helping employees cope with rising living costs, Vinatex Nam Dinh Spinning Factory provided emergency support allowances ranging from VND 10,000 to VND 30,000 per workday, implemented in different phases to suit actual conditions.In addition, the factory continuously updates employees on the overall business situation, order status, and production progress in order to encourage morale and improve workforce productivity amid labor shortages caused by post-Tet workforce migration.
