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in the field of study Management and Production Engineering
and specialisation Management and Engineering of Globalized Production

Improving product quality and quality management system to enter
Polish market: a case study of a Vietnamese garment factory

thesis number in the Faculty thesis register 110C-MSP-ZP/309220/1208869

Thi Hoang Ni VO
student record book number 309220

thesis supervisor
, prof. uczelni
consultation
---

WARSAW 2021


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ABSTRACT
Improving product quality and quality management system to enter Polish
market: a case study of a Vietnamese garment factory

Quality improvement is an effective and imperative direction to improve the


competitiveness of enterprises in the market through increasing production efficiency
in both productivity and quality of products and systems. This study is about finding
effective solutions to a company's current real demands and problems. First, the
research provides the company with a thorough insight into how to use concept, tools
and techniques of Kaizen and Lean six sigma method in analyzing the current state of
a company's problem. Typically, the skill of using 5Whys tool, pareto chart and case
and effect diagram based on collected data to identify the root causes of the company's
problems come from high defect rate. Accordingly, the main problem facing the
company, determined by the data of the second half of 2020, is that the plant's
production capacity is not high while production demand is constantly increasing. Not
to mention the plan to develop export markets to Europe in the coming time, will boost
production demand even more. It is also this strategic plan to expand the market that
sets the requirements for changing the quality management system model to meet
customer requirements. Therefore, a study has been conducted to analyze and make
the right choice for the new quality management model and to solve the problem of
factory productivity and production quality. Through careful analysis, the study
proposed to upgrade the quality management system model to ISO 9001: 2015
standards in coordination using the concept of Kaizen, Lean six sigma to continuously
improve quality. Two projects have been proposed to work on this synergy to achieve
two goals. One is reducing the defect rate on the sewing line, improving product quality
and production productivity. The second is to upgrade the quality management system
through the addition, modification and documentation of testing standards for
materials, semi-products, finished products and processes, inspection procedures, and
control of those items. The company also pays attention to Corporate social
responsibility with the orientation of pursuing ISO 14001: 2015 and ISO 45001: 2018
certification as well as strongly promoting local community programs. Despite the
barriers and limitations, this study is the basis for opening many other research
directions on integrated management systems of enterprises. All aim to fully achieve
international standards towards long-term and sustainable development of the
business.

Key words: Quality improvement, Kaizen application, quality management system,
ISO 9001: 2015, Corporate social responsibility.


STRESZCZENIE
Doskonalenie jak

Poprawa jako ci jest skutecznym i koniecznym kierunkiem poprawy
konkurencyjno ci przedsi biorstw na rynku poprzez zwi kszenie wydajno ci produkcji
zar wno w zakresie produktywno ci, jak i jako ci produkt w i system w. Niniejsze
badanie dotyczy znalezienia skutecznych rozwi za aktualnych, rzeczywistych
wymaga i problem w firmy.
d w to, jak wykorzysta
koncepcj , narz dzia i techniki metody Kaizen i Lean six sigma w analizie aktualnego
stanu problemu przedsi biorstwa. Zwykle umiej tno
narz dziem
5Whys, wykresem Pareto oraz diagramem przypadk w i efekt w na podstawie
zebranych danych w celu zidentyfikowania przyczyn problem w firmy wynika z
wysokiego wska nika defekt w. W zwi
wnym problemem firmy,
okre
y 2020 roku, jest to, e zdolno ci produkcyjne
wysokie, a zapotrzebowanie na produkcj stale ro nie. Nie
wspominaj c o planie rozwoju rynk w eksportowych do Europy w nadchodz cym
czasie, jeszcze bardziej zwi kszy si popyt produkcyjny. Jest to r wnie ten
strategiczny plan rozszerzenia rynku, kt ry stawia wymagania dotycz ce zmiany
modelu systemu zarz dzania jako ci
klient w. Dlatego
ciwego wyboru
nowego modelu zarz dzania jako ci oraz rozwi zania problemu produktywno ci

fabryki i jako ci produkcji.
analiz , w badaniu zaproponowano aktualizacj modelu systemu
zarz dzania jako ci do standard w ISO 9001: 2015 w koordynacji z wykorzystaniem
koncepcji Kaizen, Lean six sigma w celu ci
ci.
Zaproponowano dwa projekty, aby pracowa nad t synergi , aby osi gn dwa cele.
Jednym z nich jest zmniejszenie wska
d w na linii szycia, poprawa jako ci
produktu i wydajno ci produkcji. Drugim jest unowocze nienie systemu zarz dzania
jako ci poprzez dodanie, modyfikacj i udokumentowanie standard w testowania
w, p
w, gotowych produkt w i proces w, procedur inspekcji i
kontroli tych pozycji. Firma zwraca r wnie uwag
odpowiedzialno
biznesu, kieruj c si realizacj certyfikacji ISO 14001: 2015 i ISO 45001: 2018, a tak e
mocno promuj
ci lokalnych. Opracowanie to, mimo barier i
ogranicze , jest podstaw do otwarcia wielu innych kierunk w badawczych nad
zintegrowanymi systemami zarz dzania przedsi biorstwami. Wszystkie d
do
gni cia mi dzynarodowych standard
wego i
zr wnowa onego rozwoju firmy.

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TABLE OF CONTENTS

................................................................................................................
..................................................................................................................
.............................
.............................................................................................
1.2.1. Improve quality and implementation methods ..................................................... 14
1.2.2. Continuous improvement .................................................................................... 15
1.2.3. Necessary knowledge, tools and techniques used in research............................ 18
1.2.4 ISO 9001 standards for quality management system ........................................... 20
............................................................................................................................
...............................................................
..........................................
REACH Regulation ....................................................................................................... 24
Intellectual property ...................................................................................................... 25
.................................................
..................................................................................................
...............................................................................
.............................................................
3.3.1. Internal analysis .................................................................................................. 29
3.3.2. PEST analysis .................................................................................................... 34
............................
.........................................................................
3.4.1. Main products of the company ............................................................................ 44
3.4.2. Production processes ......................................................................................... 45
....................................................................................
....................................................................................
.................
..........................

..........
...............................
4.4.1. Proposal of project 1 ........................................................................................... 61
4.4.2. Practical implement have been studied for the project 1 ..................................... 66
...............................
4.5.1. Proposal of project 2 ........................................................................................... 75
4.5.2. Practical implement have been studied in the project 2 ....................................... 81

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...........................................................................
4.6.1. Standard ISO 14001: 2015 and ISO 45001: 2018 for the company ..................... 97
4.6.2. Series of campaigns for the local community .................................................... 101
4.6.3.Covid-19 protection on the work floor ................................................................. 102
.............................................
...............................................
...............................................................................................................
.................................................................................................................
..............................................................................................................
...............................................................................................................
....................................................................................................
......................................
.....

..................................................................................................................................

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Context of the research
In the context of the explosive growth of commodity production and high-tech development,
the level of competition among businesses has also become extremely fierce. This competition
has a global scale because most businesses choose to actively expand the product
consumption market as a way to increase sales, develop the company in the long term. With
European-Vietnam Free Trade Agreement (EVFTA), The Comprehensive and Progressive
Agreement for Trans-Pacific Partnership (CPTPP), there is a huge potential for market
expansion in the EU for Vietnam's Textile and Garment industry as soon as the Agreement
comes into effect in 2020
For a developing country like Vietnam and its businesses, quickly updating the world's
development trends and needs is the key to opening the door to success. This context is both
an opportunity and a challenge for the company that it needs to overcome to gain a competitive
advantage in the market. M.D.K is a member factory of Thuan Phuong Group specializing in
the production of garments for export. The company also has a certain reputation and position
in the market. However, the current company is still a small and medium sized company. The
current main market for M.D.K is the United States. Meanwhile, the company has a strategy
to expand export markets to Europe, with the current target being Poland. Because Poland is
a member of the European Union, most of the requirements for its imports coincide with the
EU's general requirements.
Continuously improving product quality and upgrading product quality management
systems according to the new definition has become a strategic step of companies in general
and of M.D.K factory in particular. New definitions of product quality and quality management
systems will be presented in section 2. Quality improvement is not only a condition for the
company's products to succeed in fastidious markets, with strict regulations on the quality of
imported and consumed goods, but also a step towards creating a solid foundation. for the
company to constantly move forward.
The complicated disease situation has profoundly affected the production and supply chain
in general around the world. This is an objective risk factor that occurs, but the impact is very
large. Measures to prevent epidemics interrupted the supply of raw materials, the production
situation was also halted, the distribution network was also attacked. However, the situation

will gradually be under control, operations will be resumed. The important implication here is
that businesses that can react quickly and have the right responses will not only overcome a
difficult situation but also gain advantage after things return to a normal trajectory.
Research is carried out as a set of improvement projects that are aimed at addressing the
quality issues of the product as well as the quality of the management system. Since then, the
company's products have the ability to reach and be accepted by the new target market,
Europe, and first of all Poland.
Research scope: The research is proposed conducting in internal departments of the M.D.K
factory which is a member factory of the Thuan Phuong Group. The focus of research is to
explore the quality aspects of the production system including quality control, management
and improvement.

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The project layout consists of 5 chapter:
Chapter 1: overview of development history in quality concept and methodology of
the study provides the process of formation and development of the concept of quality and
the world's current step in the quality aspect. From that reference to establishing methodology
for this study.
Chapter 2: requirements for exporting garments to Europe market explain general
regulations and standards that a garment company that wants to enter the European market
must adopt such as: product safety, material origin, labeling, intellectual property, social
responsibilities.
Chapter 3: analysis current status of the factory provides generally information of the
factory and in-depth analysis of the factory operating environment. SWOT-TOWS is powerful
tool utilizes the internal and external factors to generate strategies, while PEST analysis for
external factors affecting the factory. This section also presents the plant problems facing
through the data collection and analysis.
Chapter 4: improvement solutions Possible solutions will be proposed in this chapter

based on the demand and causes of problems, expertise and practice to achieve the highest
possible efficiency.
Chapter 5: evaluation of the improvement and conclusions presents the costs incurred
in the process of implementing improvements related to human and material support. The
expected benefits and results in terms of quality will be presented. Finally, there is a summary
and conclusion of the study.
Following is the presentation of the main contents of the project.

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1.

Quality is a topic that has been focused, exploited and developed over the centuries. A
product wants to appear in the market, first of all it must be valuable to consumers, but if it
wants to exist for a long time in the market, it must go hand in hand with its quality.
The concept of quality is believed to have first appeared in Europe in the late 13th century1.
When the quality of the product is simply recognized by an individual mark of a famous
craftsman and the mark is attached by the guild of these people. Thereafter, the concept of
quality changes with the wheel of time, the development of mankind. The industrial revolutions
led to significant changes in the form of the organization of production. Following in the
footsteps of pioneering quality researchers such as Frederick W. Taylor, Walter Shewhart, W.
Edwards Deming, Joseph M. Juran, the concepts, philosophies, techniques in quality are born.
They truly created an era that people must quickly catch up to. As the quality philosophies they
coined to successfully apply to companies became the standard every company aspired to
pursue in that era.
First to mention the influence of Frederick W. Taylor on the manufacturing industry in the
19th century. A method of inspection is proposed for product quality control to compensate for
quality gaps when a new manufacturing process is introduced tends to increase productivity
(Yang, 2017). Accordingly, the concept of quality gradually changed from depending on the

personal judgment of craftsmen to the method of inspection and defect correction that have
been trained in factories. Quality, then, is built to standards and is monitored and checked by
independent departments. From the late 19th century to the early 20th century, based on the
manufacturing process control studied by Walter Shewhart, Deming proposed the famous
Shewhart's statistical quality control (SQC) method2. Useful techniques and quality control
tools that Shewhart has created include a control chart to monitor and control the production
process and sampling inspection method to reduce quality costs caused by full inspection
(Yang, 2017). Then, in the mid-20th century, Juran and several of experts developed the
which was later also considered by Feigenbaum to be not effectively
controlled by SQC (Feigenbaum, 1956). Therefore, the concept of total quality control, TQC
was first introduced in 1959 by Armand V. Feigenbaum aimed to achieve quality assurance at
all stages. While Japan has successfully applied TQC in their own way and gained a
competitive advantage in the world market, America and western have continued to learn and
improve the Japanese way of becoming a total quality management (TQM) system (Yang,
2017). Total quality management is seen as a performance management approach both
tangible and intangible to achieve customer satisfaction in the long run3. From the 1990s
onwards, TQM was gradually overtaken by the ISO 9000 series of quality-management
standards, Lean manufacturing, and Six Sigma. To this day, the newest and most complete

1

2

3

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version of the ISO system is the revision in 20154. As an effective way to achieve business
excellence, more than 80 countries already established National Quality Awards (NQAs) which

are largely based on the Malcolm Baldrige National Quality Award (MBNQA) of the United
States, the European Quality Award (EQA) of the Europe, and Deming Awards of Japan (Tan,
2003) (Cauchick Miguel, 2004). In the new era, the concept of quality tends to reach creativity
in customer satisfaction. Creativity here can be responding to existing needs of customers in
new ways in the process of bringing products to customers or being creative can also exploit
customers' hidden needs to create breakthroughs in the product market, opening a new
consumer trend.

1.2.1. Improve quality and implementation methods
According to ISO standards, quality management is accomplished by means of quality
planning, quality control, quality improvement and quality assurance within the quality system
framework5. Meanwhile, according to Juran, the three main functions of quality management
are quality planning, quality control, quality improvement. From there it can be affirmed that
quality improvement is an important step of the business towards comprehensive
management, satisfying customers' needs and achieving the goals.
Quality improvement plays an important role in reducing waste, improving efficiency,
efficiency, and adding value to the organization and its customers. The focus of quality
improvement is to improve product quality in the direction that approaches customer needs.
There are many opportunities for improvement from reducing production time, reducing
defects, damage, wasting, ...; increase system performance, improve employee working
environment and relationships, and support effective management.
There are two basic forms of improvement: continuous improvement (Kaizen) and
innovation. Continuous improvement focuses on small, gradual, frequent improvements over
a long period of time, low investment costs, low level of risk, often mobilizing the participation
of many people in the organization. Continuous improvement drives effort at people and often
requires massive maintenance effort because visible effects often come slowly. Meanwhile,
innovation is usually a big, intermittent, challenging change because it often has a large
investment cost and has a significant impact on the system. Innovation is done based on
innovation, creativity, technology oriented main and exclusive. Expectation innovation delivers
breakthrough results.

In the movement and development of mankind throughout the history of time, there are
many methods of improvement, one after another, born and inherited from each other. In
which, notably is the Juran method, Shewhart cycle, Deming cycle, Kaizen and Six sigma.
Jura's improvement methods are in Juran's Trilogy. Quality improvement according to Juran is
the process of creating breakthrough quality, unprecedented innovation. Quality improvement
focuses on reducing chronic problems through structural change and process improvement.
The Juran quality improvement steps are the premise for future DMAIC process development.
This process is designed to influence causes to improve efficiency and quality (Godfrey, 2007).

4

5

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improvement


The first concept of Shewhart cycle is a straight line with three-step scientific process of
specification, production and inspection. After that, Shewhart's concept eventually evolved into
what became known as the Shewhart cycle when three steps. Deming built off Shewhart's
cycle and modified the concept into PDCA cycle (Moen & Norman, 2010).
The cycle includes:
1.
2.
3.
4.
Once again, in 1993, Deming (Deming, 1993) modified the Shewhart cycle into the PDSA
cycle. The PDSA Cycle (Plan-Do-Study-Act) known as the Deming Wheel is idea a process
oriented to learn and research new knowledge to continually improve products and processes.

The word
(Moen, 2006) in the third phase of the cycle implies that the purpose of this
phase is to build new knowledge. This means that the ability to predict whether a change will
result in improvement in the various conditions you will face in the future is the condition for
creating new knowledge. In addition, three basic questions to complement the PDSA cycle:
1. What are we doing?
2. Why do that?
3. How to do it?
In recent years, many leading companies in the world have adopted the Six Sigma Quality
philosophy. Six Sigma (Godfrey, 2007) is now considered a breakthrough thinking
improvement method that includes a rich set of concepts, statistical and management tools
that support breakthroughs in quality, minimizing variation in both process and product. Six
standard deviations from the upper and lower specifications would produce essentially perfect
products. But since most real-life processes have some shift around the mean, an empirically
based 1.5 sigma shift is introduced into the calculation. the higher the sigma is the better. Six
Sigma levels are achieved using the Define Measure Analyze Improve Control (DMAIC)
problem solving and improvement methodology.
Kaizen (Singh, (2009).) was introduced and applied by Imai in 1986 to improve efficiency,
productivity and competitiveness in Toyota. The Kaizen word includes two concepts: Kai
(change) and Zen (for the better) (Palmer, 2001). Kaizen is a system that continually improves
on quality, technology, process, productivity, leadership, culture, with many small, low-cost
improvements, implemented continuously in a long time. The core principles from the
Japanese kaizen concept to identify the sources of continuous improvement are: Process
orientation, Improving and maintaining standards, People orientation (Berger, 1997). Kaizen,
along with its tools and techniques, is a powerful support method in the process of approaching
and solving business problems towards efficiency improvement. Kaizen's continuous
improvement will be discussed in more depth in the next section.

1.2.2. Continuous improvement
Continuous improvement (CI) was especially popular in the USA during the Second World War

and in the TWI program, which was imported into Japan by the US military occupation
authorities (Singh and Singh, 2015). There are many different definitions of CI, but most of
them do not contradict each other. Featured including the following definitions. Anand et al.
15


(2009) find that CI is often defined as a systematic struggle to seek and apply new ways to
actively and constantly achieve process improvements. CI is also seen as a method of creating
a culture of improvement in systems with the participation of all people at all levels to eliminate
waste, improve the efficiency of the system (Singh and Singh, 2015). Another definition of a
CI process is processes that are scheduled for change. These processes are interrelated in
varying degrees and involve everyone in the organization towards the goal of achieving
something better (Jurburg et al., 2017). Then, according to Singh and Singh (2015) and (Imai,
2013), CI is known as Kaizen in Japan as a low investment, high efficiency method. Imai
explains that Kaizen is "improving everyday, improving everyone and improving everywhere".
Two basic functions of management are distinguished in Japan:
-

-

Application process of kaizen method basically consists of:
Process of kaizen idea application is closed in the PDCA cycle as we presented in the previous
section.
The basis of kaizen application is demonstrated through the 5s concept. 5S is a visual
workplace organization method to create a neat, tidy and clean working environment, which is
the foundation for quality and productivity improvements. There are five 5S phases. They can
be translated to English as "sort", "set in order", "shine", "standardize", and "sustain" shown
below (Wikipedia, 2020):
Sort (seiri) 1S the area will be filtered and red tagged for unnecessary items. Then remove
them from location.

Objectives:
Implementation:
Set in order (seiton) 2S locating the items. Select the appropriate position to place the items
according to their function and how often they are used for optimum work convenience.
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Objectives: tidy and orderly workplace; convenient for work; save time and effort.
Implementation:
-

Shine (seiso)3S always keep the work area and tools and equipment clean after use. Selfcheck and perform cleaning regularly.
Objectives:
Implementation:
-

Standardize (seiketsu) - standardization of previous 3S implementation steps to ensure easy,
fast and complete implementation of 3S.
Objectives: provides easy-to-understand and easy-to-follow 3S instructional procedures and
schedules.
Implementation:
Sustain (shitsuke) - maintains the implementation of 5S with the self-discipline of workers,
making 5S a habit is the culture of the workplace community.
Objectives: Maintain 5S implementation into a habit.
Implementation:
The principles, tools and techniques used in Kaizen are varied and rich. The choice and extent
to which these tools and techniques are used and used are dependent on the organization
implementing Kaizen, not under a strict regulation. The commonly used principles, tools and
techniques are (Karkoszka, 2009):


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-

-

1.2.3. Necessary knowledge, tools and techniques used in research
Acceptable Quality Limit (AQL)
AQL (Acceptable Quality Limits), which is defined in ISO 2859defects.
Currently on the AQL tables there are 2 metrics for the maximum number of accepted and the
minimum number of defects rejected. the customer or inspector relies on the number of defects
in the sampling data and the level of the collated AQL to make the correct decision to accept
or reject the shipment. Each customer typically has a different vendor-level AQL process. Most
suppliers involved in international trade in general and the European market in particular are
familiar with it6.

6

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The AQL standard identifies two important numbers:
To arrive at these numbers, two AQL tables were used that make up the AQL chart shown as
figures below:
The table 1 provides information to the user about which "code character" is used. The code
character then provides the sample size to be obtained and the maximum number of defects
that can be accepted.

Source: document of the factory


They are 3 General Levels that are I, II, and III. These levels depend on the requirements of
the customer, which determines the number of samples to test. In addition to the General
Inspection Level there are Special Inspection Levels such as S-1, S-2, S-3 and S-4 that specify
a smaller number of test samples. There are three types of defects identified: critical defects
(0), major defects (2.5), minor defects (4.0).
For example, your lot size is 13000. So, it falls between 10001 and 350
chosen is level II. As we can see on table 1
chose
M
inspection is 315 units.

M

There are different levels of AQL. With most consumers in the world, the standard AQL levels
are 2.5% for major defects, 4.0% for minor defects, and 0 for critical defects. Your inspector
will accept a maximum of: 14 major defects, and 21 minor defects. Otherwise, if there are 15
major defects, 22 minor defects, or 1 critical defect, the shipment will fail.
Flowchart
A flow chart is a chart describing the evolution of a certain process. A flowchart shows stepby-step information with drawings of different shapes according to a given convention. The
19


drawings represent jobs that are interacting with each other by connecting the arrows.
Flowchart has the benefit of describing processes in an intuitive, easy-to-understand way.
There are different types of diagrams: each of its own types of conventions. The two most
common types of shapes in a flow chart are (Wikipedia, 2020): rectangular box and diamond
box.
Five whys
The five-star is a technique used in Kaizen by asking why repeatedly to uncover cause-andeffect relationships of a problem. It has aspirational hearing. The main goal of engineering is

to simply identify the root cause of a problem. Each answer forms the basis of the next question
(Wikipedia, 2020).
The rules for performing the five-reason analysis are:
Ishikawa diagrams (also called fishbone diagrams or cause-and-effect diagrams) are causal
diagrams created by Kaoru Ishikawa that show the potential causes of a specific event. The
intended use of the Ishikawa diagram identifies the factors that cause a problem or factors that
influence a given result. Each cause arising from one or more major sources is classified under
different rules (Wikipedia, 2020).
In manufacturing, the 5 Ms is identified for root-cause analysis:
Pareto analysis
Pareto analysis is a tool to identify the main causes of the problem. There can be many causes
for a problem, but the magnitude of the causes varies. This technique helps to identify the
causes that affect most problems. Thus, when problem solving, people focus on solving these
causes instead of the whole. This saves resources while solving the problem. The commonly
chosen rule is the "80/20" rule, where 20% of the causes identify 80% of the problem.

1.2.4 ISO 9001 standards for quality management system
The ISO series of standards is an international standard written by a worldwide organization
called ISO (Lamprecht, 1992). The set of standards requires and guides the company to have
an improvement policy to improve the efficiency of the quality management system of the
business, to meet the needs of both internal and external customers and enhance
competitiveness. market. ISO 9001 first version was introduced in 1987 by ISO, now the 5th
version was released in 2015. ISO 9001 specifies the requirements for an effective quality
management system so it will focus on the following goals: organizing the quality management
system, aiming for internal and external customer satisfaction, continuous improvement and
cost saving.
20


2.


2.1.
According to statistics of website statista.com, with an export turnover of more than US$
36 billion in 2018, Vietnam is the fourth country worldwide in the export of textiles, apparel and
clothing and has become an important export sector of the country.

Source: />
With thousands of large and small businesses, this industry has provided millions of jobs
for employees every year, contributing to solving the unemployment rate and stabilizing the
social situation. However, it is worth mentioning that because the domestic raw material supply
is often not enough to meet production needs, most of it depends on imports. The workforce
of this industry has skillful skills, hard work, and low labor cost to help Vietnamese clothes to
have a great competitive advantage in the market. In recent years, Vietnam has focused on
building and developing Logistics infrastructure to meet the increasing export demand of
domestic goods, including garment. Vietnam's garment export growth rate has always been at
two digits, which is expected from 2018. Major export markets for Vietnam's textiles and
garments include the United States, the European Union, Japan and Korea. A number of
international trade agreements including the EU-Vietnam Free Trade Agreement (EVFTA) and
the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) have
fueled growth in merchandise exports for Vietnam.7
Located in the development context of the Vietnamese garment industry, the company
also inherits many beneficial and outstanding features. These features are advantages that
are not available in all countries. Therefore, the company should focus on promoting these

7

21


advantages to get a competitive advantage in the market. In addition, the company needs to

improve the constraints brought on by the business environment.

Source: />
According to the website's forecasts, Vietnam's apparel market value will continuously
increase from 2018 to 2022 as shown in the figure. It is estimated that the apparel market value
of this sector will reach US $ 3.13 billion (Statista, 2020). However, due to the sudden impact
of the Covid-19 epidemic, the value of Vietnam's garment exports decreased significantly.
According to the Vietnam Textile and Apparel Association (Vitas), despite the disease situation
at the end of the year, in 2019 the total export turnover of the industry reached 39 billion USD,
up 7.55% compared to 2018.
With European-Vietnam Free Trade Agreement (EVFTA), there is a huge potential for
market expansion in the EU for Vietnam's Textile and Garment industry as soon as the
Agreement comes into effect in 2020. With 42.5% of tariff lines applied to textile products, it
will be reduced to 0% as soon as the Agreement comes into effect, the rest will be reduced to
0% according to the 3-7 year schedule, which will help Vietnamese goods have competitive
opportunities are stronger for other countries8. Meanwhile, The Comprehensive and
Progressive Agreement for Trans-Pacific Partnership (CPTPP)9, although still beneficial for
Vietnamese exports, but due to the strict regulations on the origin of the fabric, these
opportunities have not been fully utilized. Specifically, CPTPP requires to meet the Rules of
Origin from yarn onwards, while EVFTA requires only fabrics. At the same time, the EU allows

8

9

22


people to combine origin with countries that already have FTA with the EU such as Korea,
Japan. EVFTA and CPTPP are both agreements that are expected to facilitate garment exports

in particular, help Vietnam overcome difficult times and move towards long-term development.

2.2.
There are several mandatory national and international requirements that exporters to the
European market need to comply with. This includes legal requirements concerning product
rade Helpdesk
for an overview. Additionally, many buyers have created non-negotiable terms and conditions
which all their suppliers need to respect. These requirements are non-legal, but still mandatory.
Both categories of requirements have become stricter in recent years.10

Aspects
The Act of 18 June 2012. labor law
The Act of 23 June 2014. Environmental Protection
Law
Legal requirements
(source: /> )

The Act of 23 June 2014. Customs Law
The Act of 26 November 2014 Investment Law
Circular of the Minister of Industry and Trade on 15
June 2020 on rules of origin in the Free Trade
Agreement between Vietnam and the European Union

Standard have been met

ISO 9001: 2008 quality management system complies
with international standards
ISO 14001: 2004 management system and
environmental protection in line with the international
standard

Product safety (GPSD)

Standard requirements11

Product Safety Directive (GPSD)12, is the first standard
that must be followed if a product is to be found in the
European market. In addition, there are specific safety
requirements that take precedence over GPSD for
some textile products. The product will be tested to
meet applicable safety requirements in the country
targeted by the company. If the product does not meet
these requirements, it will be rejected from the
European market.

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It is the responsibility of the buyer to ensure that it is
legally safe for consumers to use if they are the
supplier of the product design.
Make sure your company's suppliers of fabrics, trims
and accessories are familiar with the legal safety
requirements for apparel exports to the EU.
Find out the list of rejected apparel items with detailed

descriptions of previous safety risks in the European
Union's RAPEX database13.
An instruction is provided to check pending requests in
the database14. An effective method is to get in touch
to see how to do it from people who have successfully
passed legal and non-legal safety standards.

REACH Regulation
REACH is the most common legal requirement that
apparel exporters to the EU must comply with including
Registration, Evaluation, Authorization and Restriction
of Chemicals. REACH focuses on regulations
restricting the use of chemicals in the manufacturing of
clothing. The full list of REACH-restricted chemicals
should be checked at Substances restricted under
REACH15.
REACH conducts the collection, study and evaluation
of information on the hazardous properties of
substances in order to establish requirements and
regulatory procedures. Companies register for their
REACH compliance to be assessed by the ECHA.
While EU Member States conduct an assessment of
the effects on human health or the environment of the
substances in the clothing. ECHA then analyzes the
risks of administering these substances.
Requirement to prohibit or limit the use or condition the
use of substances by authorities according to their
ability to control risks. REACH's sphere of influence is
wide and covers many fields, even when the business
itself is not aware of its relevance.

In general, according to REACH, the company acts as
Importer, Downstream User, Companies established
outside the EU Importer: If the company purchases
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anything from outside the EU / EEA, then the company
has
certain
responsibilities
under
REACH.
Downstream users: the company should check your
obligations if there are any chemicals in your industrial
or professional activity. Companies established outside
of the EU: The company is not bound by REACH's
obligations.
Responsibility to fulfill REACH's requirements remains
with importers in the European Union. Also possible
with representatives of a non-EU producer established
in the European Union.
CE marking: Because the company tend to export
apparel to Europe including personal protective
equipment (PPE) to the EU, it must be compliant with

specific EU safety standards16 for the design,
manufacturing, material use, testing and user
instructions concerning PPE. You are obliged to affix
CE marking17 requirements for PPE must be complied
with as an indication of PPE's compliance with the
safety and environmental protection requirements of
the company's products.
1007/2001 Regulation of Europe Union
It is essential to announce the ingredients of the
apparel product that the company intends to export to
the EU, in accordance with EU Regulation 1007/2011.18
European consumers value the inclusion of care labels
in the company's clothing products. So there is an
incentive to do so even though country of origin and
care instruction labeling are not required in the EU. This
also facilitates product traceability if a defect occurs. On
the other hand, in the ISO standard there is also a
priority standard for the labeling of care.

Intellectual property
Make sure that the company does not infringe any
intellectual property (IP) rights if you are selling its own
designs on the European market. If your buyer provides
the design, they will always be responsible for
ownership. Compliance with intellectual property rights
also means that you cannot copy or share successful
designs or other designs from one buyer with another
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