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Vietnam garment, footwear SMEs should improve supply chain management: workshop

Friday, April 10, 2015, 10:01 GMT+7
Vietnam garment, footwear SMEs should improve supply chain management: workshop
Jeff McLean, UPS Vietnam country manager, gives a speech at a workshop on supply chain readiness training and garment and footwear sectors co-organized by the U.S.-ASEAN Business Council and the U.S. Agency for International Development in Ho Chi Minh City on April 7, 2015.

Vietnamese small- and medium-sized enterprises (SMEs) operating in leading industries, like garments and footwear, should upgrade their capacity in supply chain management to raise the added-value of their products, local and foreign experts said at a recent workshop in Ho Chi Minh City.

As Vietnam has signed, or is finalizing, trade pacts with many foreign partners and economic blocs, upskilling their capacity in supply chain management will help foster their competitiveness, the experts commented at the workshop on supply chain readiness training and garment and footwear sectors on Tuesday.

The event, co-organized by the U.S.-ASEAN Business Council and the U.S. Agency for International Development, was the first activity in a series to be conducted to help 30 SMEs in the two industries in Vietnam, Myanmar, and Cambodia grasp opportunities for integration and development, the organizing board said.

According to the U.S.-ASEAN Business Council, 98 percent of Southeast Asian firms operating in the garment and footwear sectors are small- and medium-sized enterprises, which contribute significantly to the region’s turnover.  

"The number of small- and medium-sized enterprises account for over 96 percent of businesses across the ASEAN region and contributed greatly to the global GDP. This is an important economic base for the region, as they will become strong partners in the global trading operations when supported with necessary tools and resources,” said Jeff McLean, UPS Vietnam country manager.

However, those SMEs are not actively involved in the world and the ASEAN market, and have yet to play a specific role in the global value chains.

ASEAN stands for Association of Southeast Asian Nations, a political and economic bloc consisting of Indonesia, Malaysia, the Philippines, Singapore, Thailand, Brunei, Cambodia, Laos, Myanmar, and Vietnam. 

According to reports unveiled at the workshop, in the context of global economic integration, one certain company will not produce a complete product as they did in the past, but they will only focus on making one or some parts with different levels of added value, which is part of the world’s value chain.

Thus, local businesses need access to new criteria and new tools which will enable them to adapt to flexible changes in supply chain management in order to effectively respond to the development of the global economy.

One of the world's leading garment businesses shared their experience that improving supply chain management lies in constant creativity and innovation, and is based product quality assurance, confidence in delivery, cost competitive and sustainable standards building.

"The world is increasingly open for business and bringing endless opportunities for SMEs in the ASEAN region," said Jim O'Gara, president of South Asia District, UPS Asia Pacific.

"The future manager will not only compete on price but also on the ability to respond rapidly and faster services," he added.

The U.S. Agency for International Development (USAID) and the U.S.-ASEAN Business Council on March 4, 2014 signed a memorandum of understanding on creating the U.S.-ASEAN Business Alliance for Competitive Small- and Medium-Sized Enterprises.

The Business Alliance will combine the efforts of the USAID and major U.S. corporations to develop the capacity and boost competitiveness of SMEs in the ASEAN region.

The alliance will use training programs, mentorship opportunities, and cloud technology to support SMEs in the five key areas: access to finance; access to regional and international markets; human resource development; access to information and advisory services; and access to technology and innovation.

SMEs are the backbone of the ASEAN economy, accounting for more than 96 percent of all enterprises and for between 50 and 95 percent of all employments in many ASEAN member states, according to the USAID.

Strengthening the capacities and capabilities of SMEs in the ASEAN region is among the highest impact interventions that can be made to accelerate growth there and advance the interests of the ASEAN Economic Community, the USAID said.

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Thoai Tran/Tuoi Tre News

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