Vietnam and Cambodia have become pivotal players in global manufacturing, particularly in textiles and garments. Each country offers unique advantages and faces distinct challenges, making them appealing to different segments of the market.
Market Shares in the US Apparel Import Market
A chart from OTEXA (2024) shows the sources of US apparel imports by value for various countries. It highlights the percentage contributions from each country, illustrating the dominant suppliers and their respective market shares in the US apparel import market.
Key players such as China, Vietnam, Bangladesh, and India are shown with growing roles in the apparel supply chain to the United States.
Here are two elements of comparison between China, Vietnam, and Cambodia based on the chart:
Growth Over 9 Years:
- China: Decreased market share from around 36% to 24%.
- Vietnam: Increased market share significantly from approximately 10% to 19%.
- Cambodia: Slight increase in market share from about 5% to 6%.
Year-to-Year Percentage Changes:
- China: Exhibits a general decline each year.
- Vietnam: Shows consistent year-to-year growth.
- Cambodia: Experiences modest and steady growth each year.
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These comparisons highlight the dynamic shifts in the apparel import market to the US, with Vietnam emerging as a significant growth leader.
Analysis on Textile and Garment Manufacturing
Vietnam is noted for its cost-effective and highly efficient labor force. A reader on this blog shared, “Vietnam’s garment factories are known for their high productivity and strong work ethic,” illustrating the country’s labor strengths.
Despite having less advanced technology, Vietnam compensates with a mature infrastructure and significant market share, especially in the US market.
“Vietnam’s established infrastructure supports extensive manufacturing operations,” highlighted Sheng Lu, Professor, Department of Fashion & Apparel Studies, University of Delaware
In contrast, Cambodian factories often face issues with labor-intensive work and less safe environments. A reader mentioned, “Factories in Cambodia can be more crowded, raising concerns about worker welfare.”
“Working conditions in some factories raise ethical concerns, highlighting the need for stronger labor regulations and worker safety protocols.”, added this page from Giz Cambodia
Economic and Strategic Factors
Vietnam’s well-established infrastructure and stable political environment provide a robust foundation for large-scale manufacturing. On the other hand, while still developing, Cambodia is becoming increasingly attractive to investors looking for cost-effective alternatives. However, infrastructural challenges can impact efficiency and reliability.
Vietnam often adheres to international standards, making it favorable for brands emphasizing sustainability and social responsibility. Improvements in safety and technology are necessary for Cambodia, but its cost advantages cannot be overlooked for certain market segments.
“Vietnam’s workforce is highly disciplined and efficient, making it ideal for high-volume production.”, we can read on Sheng Lu blog comments
Choosing between Vietnam and Cambodia for manufacturing and sourcing depends on specific business needs, including cost, technology, and compliance requirements.
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Vietnam’s mature infrastructure and labor market make it ideal for large-scale production, while Cambodia offers cost advantages for budget-sensitive operations. As both countries develop, they will continue to play pivotal roles in the global manufacturing landscape
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Source: Vietnam Insider