VietNamNet Bridge – Domestic brands are expected to have opportunities to prosper in the local market amid the massive arrivals of foreign brands.
Pessimistic forecasts have been given about the fate of Vietnamese fashion brands which have to compete with powerful brands like Uniqlo, Zara and H&M.
Vietnamese brands, such as Blue Exchange, Ninomaxx, PT 2000, Couple TX and Canifa, once dominated the domestic market.
At that time, there were foreign brands in the market, including mid-end brands from Hong Kong such as Bossini and Giordano. Miniso was also present in the market through a franchise contract with Le Bao Minh Company. However, the foreign brands did not affect market share held by Vietnamese brands.
The presence of Zara and H&M has remapped the domestic fashion market. On pre-Tet days in February, customers were seen standing in long queues at Zara and H&M shops, waiting for their turn to buy products.
The Q2 2017 report of BMI, a market analysis firm, showed that Vietnamese customers spend more money on foreign branded goods. The value of the Vietnamese fashion market (clothing & footwear) is estimated at $3.8 billion in 2018, of which expenditures on clothing are $3.5 billion.
Vietnam, which mostly does outsourcing for foreign partners, has never been considered a power in the fashion industry. However, analysts believe that Vietnamese brands will not surrender to foreign brands in the home market because they have certain advantages.
Vietnamese fashion companies have to cement their positions in the market by expanding their distribution networks and carrying out marketing campaigns.
Canifa, a fashion brand better known in the north which became famous in 2000 and began marketing products for children in 2007, recently spent big money on media campaigns. The brand is the sponsor of famous TV shows such as Project Runway and Vietnam Next Top Model.
Doan Thi Bich Ngoc, CEO of Canifa, thinks the weak point of fashion companies is that their shops are mostly located in large cities, which means a limited distribution network.
Nguyen Thi Kim Xuyen, chair of Truong Thang company which owns CoupleTX brand, said one of the priority tasks of the company in 2018 is increasing the number of shops to 60 through franchise contracts.
Chu Phuong Doan from LeFlair said the market is witnessing the appearance of many fashion brands developed by Vietnamese companies, which started business with sales via Facebook and have now decided to open shops. Each of these companies has more than five shops.
Photo: CBR Investment AG