Manufacturing suppliers – Sourcing in Vietnam

Article Description : This article titled ‘Manufacturing suppliers – Sourcing in Vietnam’ demonstrates an overview of the current Metalworking manufacturing market of Vietnam.

Industry overview:
Firstly, Vietnam is a low-cost country with respect to quality-based manufacturing sector. The geographical location between Asia and the West while bordering China is considered as the country’s greatest advantage in terms of industrial activities. The immediate import and export opportunities to the neighboring countries in Asia and the West using the shipping strength is a key advantage. Similarly, the overcrowded market of China urges the manufacturers to choose the Vietnamese market for diverse supplier scouting. This offers them advantages like low cost investments, multiple ports to facilitate exports and imports in huge numbers. Beyond these reasons, the highly competitive Chinese market prompts the manufacturers to choose Vietnam over China. In addition to this, the number of ports available in Vietnam proved to be an economic benefit for the producers of goods and services.

Secondly, the manufacturing practices carried out in Vietnam are a supplementary favor in terms of procurement and purchasing. The Government has adopted certain regulations and policies to maintain a sustainable environment while simultaneously balancing the industrial production. This attracts the investors to contemplate investments in Vietnam making supplier discovery a big strength with a stable sourcing strategy.

Thirdly, the labor cost of the manufacturing industries is very low although the quality is never compromised. The manual capabilities of the workers are an asset to the sector. Since their optimal goal is to reach the utmost quality of their products or services beyond all challenging constraints.

Lastly, the quality inspection norms are very strict that makes the industry produce only the best outputs. This seeks the attention of the foreign traders who aim to produce world class machines and metals at low cost. For this reason, the industry accepts only a marginal amount of orders to balance the quality-output-delivery time ratio.

Such perks of the market are solely supported by the Government. Consistent efforts to formulate policies in accordance with the uncertainties arising at a superlative degree are undertaken. The procurement management performed through efficient purchase orders of metalworking products or services help the country rank as a leading market in the Global economy.

Current scenario:

Vietnam showcases a healthy growth trend presently although there is passivity in the pace of the manufacturing sector. The Metalworking market is highly influenced by the demands from the neighboring countries. They are active players in the production of machines, machine tools and auto-parts. The economic slowdown has affected the market, yet it does not pose a huge threat to the supplier networks. Though the manufacturing sector has its complications inflicted by the external economic scenario, the services sector is found booming. As a producer of Steel, the country leads the market impacting substantial growth in the beneficiary industries. Due to the growing phase of the sector, several innovations initiated by the industry to keep up as a local producer and global contributor.


Although there is a wide growth in the industry, experts claim that it is necessary to cope up the pace to avoid crunch during downturns. Apart from this, the sector attracts over piling of domestic and international orders. This causes a peril situation to the market in terms of port availability and excessive momentum of production. The overall global economic turnarounds are also expected to pose a tough time in the sector.

The inflation in specific areas of the sector seem to slightly affect the procurement process in the sector in near future. But the awareness and prepared strategies of the Government are anticipated to get the sector off any hook.

Price analysis:

Adopting to Metalworking Manufacturing process has its own advantages and considerations as that of Procurement process. The reasonable cost of production and labor charges makes Vietnam a prime destination for manufacturers. Although the exclusive products that must be outsourced are expensive, the overall price of the total production seems to put manufacturers at ease.

Target market:

Industrial engineering, Automation engineering, Fabrics, Automotive industry, Information Technology, Elastomer production industry, Food processing sector, etc.

Competitive analysis:

With increasing demand for technologically advanced and prefabricated products, the sector faces heavy competition from other Global giants like Germany and the United states who maintain a sustainable corporate strategy by making abundant investments in automation. While the market is expected to balance this competition in terms of technological advancements, it is also demanded to come out even with pricing and quality assurance.

Existing Demand:

While Vietnam is an outstanding choice for different types of manufacturing, the crucial demand is its technological progression. The Global market seems to intensify the technological automation in accordance with Industry 4.0. This ordains a pressure on the market to focus centralization at a faster pace.

Business Challenge:

In par with the existing demand, the only biggest challenge that Vietnam faces is industrialization. It is expected to switch to automated machinery and smart factory zones as soon as possible to counterbalance with the upward trajectory of the Global market growth.

Predictive insights & outlook:

The rate at which the investments are made in the market may cause a severe counteraction in the forthcoming years. Firstly, it is anticipated that the Global competitors may lower the prices to attract the customers highly challenging the existing suppliers in the Vietnamese market. As a result, the economic benefits may face a threat. Yet, as a smart industry, Vietnamese manufacturing sector would come up with resolute policies to save the situation.

Fortunately, the production capacity of the industry may experience a boom in the export of metal products due to increased demand in the Global market. This keeps up the hope of efficient supplier sourcing and active supplier management process in Vietnam.


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For supplier sourcing in Vietnam:
Vietnamese suppliers in our Global Metalworking network