Surrounded by difficulties, Ha Tinh textile enterprises cut workers, accept losses

With orders dropping, textile and garment enterprises in Ha Tinh are having to cut workers, reduce capacity, accept losses, and even temporarily close because they cannot cope with the difficulties.

From November 1, 2023, Five Star Garment Joint Stock Company (Dai Kim Industrial Park, Son Kim 1 Commune, Huong Son) officially suspended operations due to lack of production orders. As a result, 300 workers had to temporarily quit their jobs. Currently, the Board of Directors of Five Star Garment Joint Stock Company is trying to find markets and bring in new orders so that the company can resume operations, thereby creating stable jobs for workers.

Vinatex Hong Linh Joint Stock Company suffered losses due to increased raw material import prices and production and transportation costs while product selling prices decreased.

At Vinatex Hong Linh Joint Stock Company (Nam Hong Industrial Park, Hong Linh Town), this is also an extremely difficult period when this enterprise is facing the biggest loss ever. In more than 10 months of 2023, Vinatex Hong Linh Joint Stock Company produced and consumed more than 5,300 tons of yarn, with revenue reaching about 389 billion VND, a loss of more than 30 billion VND. Not only is there a loss, but orders have decreased, so the enterprise currently has a large inventory of more than 600 tons of yarn.

According to Mr. Pham Anh Tuan - Chief Accountant of Vinatex Hong Linh Joint Stock Company: The company specializes in producing and exporting yarn, in which the main source of raw materials is imported. Recently, the tension between Russia and Ukraine along with the impact of the global economic recession has negatively impacted the production and business situation of the enterprise. The price of imported cotton increased, while the selling price of yarn decreased sharply and production and transportation costs increased, so the enterprise had to compensate for losses. Currently, the company is making efforts to not disrupt the production and business chain in order to maintain jobs for more than 300 workers.

Surrounded by difficulties, Ha Tinh textile enterprises cut workers, accept losses

MTV Garment Export Joint Stock Company only produces 4/8 production lines because of few orders.

Also being "surrounded" by difficulties, MTV Garment Export Joint Stock Company (Bac Cam Xuyen Industrial Park) only maintains production on 4/8 production lines. With a decrease in orders, this enterprise had to reduce its workforce from 300 to 170. Workers' income also decreased by about 1 million VND/person/month. In the first 10 months of 2023, the company's revenue was only about 25 billion VND, reaching 71% of the 2023 plan.

Ms. Luong Thi Tuyet - General Accountant of MTV Garment Export Joint Stock Company shared: “Traditional orders from the Japanese market have all been reduced in quantity, so we have to make efforts to find new customers in the European and American markets. However, new product codes are difficult to make, so productivity is not high, in fact the business has no profit, even has to compensate for losses, but we still have to make efforts to avoid a broken production chain. At this time, the factory's capacity has been reduced by half and output has also decreased by about 1/3 compared to last year."

Surrounded by difficulties, Ha Tinh textile enterprises cut workers, accept losses

TAAD Ha Tinh Production Investment and Trading Joint Stock Company accepts processing small orders both domestically and internationally to maintain the production chain.

According to enterprises operating in the textile and garment sector of Ha Tinh, this difficult situation has lasted from February 2023 to now and is forecast to last until mid-2024. The cause of the difficulty is due to the global economic downturn, high inflation in the US, UK, EU, Japan, South Korea... reducing demand for textiles and garments; leading to a lack of orders and a sharp drop in processing prices.

To maintain operations, Ha Tinh textile and garment enterprises are stepping up their search for customers, accepting small orders both domestically and internationally. "The company accepts even difficult orders, with processing prices sharply reduced by 20-40% compared to the previous period to provide work for workers. For many months now, the company has not organized work on Sundays. It is expected that in December, we will also give workers Saturdays off because there are currently very few orders. In 10 months, the revenue of 30 billion VND, has only reached more than 54% of the yearly plan" - Mr. Pham Dinh Nhan - Director of TAAD Ha Tinh Production, Investment and Trade Joint Stock Company said.

Surrounded by difficulties, Ha Tinh textile enterprises cut workers, accept losses

Ha Tinh currently has 6 textile and garment manufacturing and trading enterprises with more than 3,500 employees.

According to statistics from the Department of Industry and Trade, Ha Tinh currently has 6 enterprises operating in the production and trading of textiles and garments with more than 3,500 employees, a decrease of more than 1,000 employees compared to 2022. Through a survey, orders from Ha Tinh textile and garment enterprises have decreased by about 40% compared to before.

In October, textile and garment export turnover reached 1.3 million USD, only 62% compared to October last year. Currently, the Department of Industry and Trade is grasping and receiving suggestions from enterprises operating in the textile and garment sector to have a support plan to help enterprises overcome the difficult period.

Phan Tram - Thu Phuong

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