“Embodying the philosophy of its time while upholding timeless human values” serves as the guiding principle for Hoa Tho Textile & Garment Corporation. with its rich heritage, the corporation has evolved into a leading enterprise in the yarn and garment sector, playing an important role in Vietnam’s textile industry in the central region. Throughout its journey toward establishing a strong brand and reputation, Hoa Tho has been ardently pursuing sustainable development. To learn more about its exceptional strategies, our reporter has an interview with Mr. Nguyen Van Hai, Member of the Board of Directors, General Director of Hoa Tho Textile & Garment Corporation.
Hoa Tho has proactively invested in state-of-the-art machinery and equipment, optimized production automation to enhance productivity and product quality
Could you tell us about Hoa Tho's notable achievements in optimizing its operations over its nearly 18-year history, especially in the export-driven textile and garment industry?
Founded in 1962, after more than 60 years of operation, Hoa Tho Textile & Garment Corporation has made remarkable development, from a small factory taken over after national reunification to one of the core units of Vietnam National Textile and Garment Group (Vinatex) at present. In particular, since its equitization 18 years ago, the corporation has made strong development as expected. The clearest evidence is its revenue grew more than 5.8 times, from VND800 billion in 2007 to VND4,797 billion and export earnings soared more than 4.6 times, from US$56 million to US$262 million. The firm usually contributes up to more than 10% of Da Nang City’s total export value. In addition to VND85 billion paid to the State coffers a year, we have joined in many programs to promote and support local social security. our production capacity has scaled up, powered by 19 member companies and nearly 12,000 employees from Quang Tri, Quang Ngai and other provinces. Our products, made with modern machinery and offering high quality and style, are highly valued by customers worldwide, including in the US, Europe, Japan, and South Korea.
Over several successive years, we have garnered recognition as an employee-centric organization, a reputable exporter, a company with customs priorities, and a brand of Vietnam Value, among other prestigious accolades bestowed by the Ministry of Industry and Trade, Da Nang City People’s Committee, and other agencies. Notably, on November 9, 2023, we successfully listed over 36 million HTG shares on HoSE, an event that signified the corporation’s maturity in all facets, encompassing business and administration. This achievement reflects Hoa Tho’s persistent efforts toward sustainable development. Hoa Tho has recently received approval to extend its status as a customs priority enterprise for a further three years, commencing from May 10, 2024.
Aiming to be a leading textile enterprise in Vietnam and the region, Hoa Tho Textile & Garment Corporation has overcome numerous challenges, particularly the 2023 economic recession. Could you detail the specific hurdles and the “gains” and “losses” during this period?
To reach its current stature, Hoa Tho has navigated a lot of challenges. Specifically, in 2023, the corporation was impacted by a resurgence of economic downturn, commencing from the fourth quarter of 2022. This underscored the anticipation of market adversities. Like its counterparts, Hoa Tho proactively implemented many strategies to mitigate these challenges, yet it was not impervious to the negative repercussions. Consequently, the corporation’s revenue, profit, and overall performance experienced a downturn. However, this period was not perceived as a “loss”, but rather as a hurdle that any enterprise must confront and overcome.
The successful navigation of Hoa Tho through the turbulent period of 2023 reaffirms the efficacy of the strategic measures that we have concurrently implemented across our operations. However, we also acknowledge that our triumphs are not solely the result of the Corporation’s Board of Directors’ resolute efforts. We have consistently received guidance and supervision from the Vietnam Textile and Garment Group, the unwavering trust and loyalty of our longstanding customer partners, and the unity, empathy, and comprehension of our employees. From that concern, trust, and passion, in extremely difficult times of the market, we were still prioritized by customers to select production capacity, ensure orders for factories, ensure jobs and incomes for employees and maintain a stable labor source to realize its long-term strategic goals. And, this is what Hoa Tho “gained” in this period as it used to in the past.
Hoa Tho Textile & Garment Corporation is committed to steering the sustainable development of the textile and garment industry toward environmentally-friendly practices
How does Hoa Tho plan to adapt its manufacturing processes to capitalize on the rising trend of high-tech investments in Vietnam?
The imperative for digital transformation and the intensity of competition requires a paradigm shift in the strategies and technological advancements of Vietnamese textile and garment manufacturers to maintain their competitive edge. In response to this, we swiftly embarked on digital transformation initiatives, integrating information technology into our production and business operations, and implementing smart factory management and ERP software for production, business management, accounting, and human resources. These measures have yielded tangible outcomes. Furthermore, we have proactively invested in state-of-the-art machinery and equipment, optimized production automation to enhance productivity and product quality, streamlined production processes, minimized labor, and maximized production efficiency.
A crucial element of our strategy is the proactive adoption of green transformation solutions in our production processes. This includes prioritizing investment in renewable energy sources, maximizing electrical energy conservation, minimizing the use of fossil fuels, and reducing CO2 emissions. As our production capacity system continues to evolve toward perfection, bolstered by modern technology, high automation, and the serious and effective implementation of digital and green transformations, we have earned the recognition and appreciation of our customer partners. This has resulted in increased customer preference and enhanced competitiveness.
How has Hoa Tho showcased its steadfast commitment to integrating eco-friendly practices into its operations, considering the growing importance of sustainability in Vietnam's textile and garment export markets?
In the prevailing scenario, businesses and export industries grapple with many challenges and escalating consumer and market standards. “Green” production is viewed as a long-term resolution to these issues. We are fully cognizant of this reality and are not remaining on the sidelines. In our production and business strategy 2020 - 2030, with a vision to 2035, we are unwavering in our commitment to “greening” production and achieving sustainable development objectives. The focus remains on digital and green transformation, with investments directed toward highly automated, modern, and intelligent factories. We also embrace new technologies, recycled and renewable materials in our production, construction, and renovation processes; optimize electrical energy usage, minimize reliance on fossil fuels, and reduces CO2 emissions into the environment. Our objective is to steer the sustainable development of the textile and garment industry toward greening.
In 2024, the textile and garment industry is forecast to navigate complex challenges, with customer expectations for green and sustainable practices intensifying. However, Hoa Tho remains confident when it has set many important targets with consistent solutions on markets, investment, human resource management, financial management, risk management and digital transformation.
We are confident that, fortified by its robust internal capabilities, a workforce of exceptional skill, and a well-defined corporate culture, coupled with the invaluable support from all tiers of government, the strategic guidance and leadership of the Vietnam National Textile and Garment Group, and the unwavering trust of our customer partners, Hoa Tho Textile & Garment Corporation is well-positioned to effectively execute its strategic objectives. In alignment with the industry’s objectives, we are also actively engaged with Da Nang City in green transformation initiatives, energy conservation, and the utilization of renewable energy in production. We are honored with the award “Unit that uses energy economically and efficiently in Da Nang city in 2023” presented by the City. We are committed to furthering our efforts to become a representative brand for Da Nang’s industrial image, thereby contributing to the socio-economic development of Da Nang city specifically, and the nation at large.
Thank you very much!
By Han Luong, Vietnam Business Forum
Vietnamese
October 2024
Hanoi