Accepted Manuscript

Recent sustainable trends in Vietnam’s fashion supply chain

Rajkishore Nayak, Mohammadreza Akbari, Shaghayegh Maleki Far

PII: S0959-6526(19)30948-5

DOI: 10.1016/j.jclepro.2019.03.239

Reference: JCLP 16243

To appear in: Journal of Cleaner Production

Received Date: 14 April 2018

Accepted Date: 22 March 2019

Please cite this article as: Rajkishore Nayak, Mohammadreza Akbari, Shaghayegh Maleki Far,
Recent sustainable trends in Vietnam’s fashion supply chain, Journal of Cleaner Production (2019),
doi: 10.1016/j.jclepro.2019.03.239

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 ACCEPTED MANUSCRIPT

Recent sustainable trends in Vietnam’s fashion supply chain

Rajkishore Nayaka,*, Mohammadreza Akbarib, Shaghayegh Maleki Farb

a School of Communication and Design (fashion merchandising), RMIT University Vietnam, Ho Chi Minh

City, Vietnam

b School of Business and Management (SBM), RMIT University Vietnam, Ho Chi Minh City, Vietnam

* E-mail address: rajkishore.nayak@rmit.edu.vn (R. Nayak)

Highlights:

 The sustainable supply chain concept is new to many Vietnamese fashion enterprises

 Sustainable supply chain includes green material, fair labor codes and renewable energy

 Fashion brands focus on sustainable products manufactured following ethical practices

 Fashion buyers emphasize green certifications such as Oeko-Tex and ISO 14001

Abstract

The integration of sustainable practices within the fashion supply chain has been one of the areas

receiving increased attention due to global competition and stricter regulations. The concept of

Sustainable Supply Chain Management (SSCM) ensures that eco-friendly practices have been

adopted by many global fashion brands. Fashion industries in developing countries such as Vietnam,

one of the leading fashion manufacturing countries in South-East Asia, are under tremendous

pressure to comply with sustainability norms. Therefore, this paper aims to review the recent trends

in SSCM in Vietnam’s fashion and retail industries. A four-step approach was adopted: collection of

information through literature or data collection (step 1), classification and codification (step 2),

input of industry experts (step 3) and analysis of the above three inputs (step 4). The findings

showed that although Vietnam is among the top five exporting countries of textiles and garments

globally, the concept of a sustainable supply chain is new to many of the Vietnamese supply chain
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players. Four out of five stakeholders claimed that they are attempting to achieve sustainability by

reducing environmental pollution, taking care of the labor force, and pursuing future sustainable

materials as well as renewable energy resources. In addition, one of the stakeholders, the retailers,

regularly focus on ethical practices in their sustainable sourcing. These practices help Vietnam to

concurrently diminish its environmental impact and ensuing negative consequences as well as

improve the country’s social and economic sustainability.

Keywords: Supply chain management; Fashion sustainability; Textiles and garment, Emerging

economy; Third-party logistics; Vietnam

1 Introduction

The adaptation of sustainable practices is rapidly increasing in managing the supply chain. Supply

chain management plays an important role among experts (König and Spinler, 2016), where the

competition today is understood “as supply chains” as opposed to “to supply chains” (Christopher,

2016). Supply chain management refers to the integration and planning of the entire processes,

from raw materials to end customers (Winter and Knemeyer, 2013). Many organizations are aiming

to achieve sustainable supply chain management (SSCM) and green supply chain management

(GSCM). Shedroff (Shedroff, 2009) defines SSCM as “the integration and coordination of economic,

environmental and social practices throughout the supply chain to improve firms’ economic,

environmental and social performance along the supply chain”. Yang et al. (Yang et al., 2010) define

GSCM as “traditional supply chain management (SCM) practices, which integrate environmental

criteria or corners in to organizational purchasing decisions and long-term relationships with

suppliers.”
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With the rapid expansion of the global awareness of ethical responsibilities to the economy, society

and the environment, the adaptation of sustainable practices is progressing in supply chain networks

(Akbari et al., 2017). Currently, academics and practitioners are increasingly concerned with

sustainability as global awareness, an idea that has gained momentum over recent decades. The

inputs from a variety of stakeholders (e.g., communities, environmental consultants, suppliers and

their staff) may be necessary to assist with important aspects of the criteria for supplier selection

and environmental performance (Govindan et al., 2015). However, the extent to which companies

implement sustainability into their supply chain processes, particularly in emerging countries, must

be studied (Mani et al., 2018).

Due to environmental, social and economic complications, especially in emerging countries,

companies allocate substantial time and effort to ensuring the highest quality and standards in their

entire supply chain networks (Turker and Altuntas, 2014).

Since the end of the Vietnam War, the economy has progressed rapidly, and large-scale poverty has

been significantly reduced. Today, Vietnam is one of the fastest-growing developing countries, which

attracts many foreign direct investors (FDI) in the manufacturing sector (Pincus, 2016). Among all the

manufacturing sectors, the most notable is the fashion industry, which comprises textile, garment

and trim manufacturers (Nayak and Padhye, 2015b). As the manufacturing of fashion primarily

involves the textile and garment industries, this paper will focus on these two sectors.

From the statistical data that will be discussed in the next section, it can be concluded that Vietnam

is one of the emerging countries in the global textile and garment supply chain. Hence, it is essential

for the manufacturing industries and economists to understand the status of the textile and garment

supply chain in Vietnam. Although several papers have been published on the economic growth of

the textile and garment industries, labor-related problems and the government policies in Vietnam
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(Export.gov, 2017; Barnes and Lea-Greenwood, 2006), no publication provides adequate knowledge

of the supply chain management of the Vietnamese textile and garment industries.

Some studies modeled on developed countries (in the US and UK) concentrate on sustainable

development in managing the fashion supply chain (Şen, 2008; Allwood et al., 2008; De Brito et al.,

2008). However, limited studies have reported the sustainability status of the fashion supply chain in

emerging countries such as Vietnam, which plays an important role in the global fashion industry.

Compared to other Asian countries, Vietnam’s economic growth is significant, and many of the

fashion brands are relocating to Vietnam. Hence, the purpose of this paper is to investigate the

supply chain management and sustainability approaches in the Vietnamese fashion and retail

industry. To meet these objectives, we investigated the status of this discipline with the following

research questions (RQs).

RQ1: As one of the global leaders in fashion production and distribution, what is the current status

of Vietnam’s fashion industry?

RQ2: With imminent changes in the fashion supply chain, what are the current sustainability trends

in Vietnam relating to planet, people and profit?

2 Literature review

2.1 Consideration of Vietnam's fashion supply chain

Vietnam is the thirty-sixth largest economy on the planet (Clarke et al., 2017), with a population of

over 96 million and 35% of this population living in urbanized regions (Akbari and Hopkins, 2018). It

is predicted that by 2021, Ho Chi Minh City (HCMC) will be the second fastest growing economy in

Asia (Tu, 2017). In the last two decades or so, the textile and garment industries in Vietnam have

witnessed rapid growth. Competitive labor prices and favorable government policies in Vietnam
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have helped to boost the export of textiles and garments and have positioned the country among

the top seven global exporters (Organisation, 2016). With approximately 6000 garment factories,

this sector provides employment to approximately 2.5 million people, which is approximately 2.7%

of the country’s population (Nguyen, 2017). Most of these textile and garment industries are

privately owned (84%), of which approximately 70% are based on garment export; this fraction was

only 41% in 1997 (Hill, 1998). As per estimates from the international monetary fund (IMF), the gross

domestic product (GDP) and the real GDP growth for 2016 were US$201.5 billion and 6.1%,

respectively (Fund, 2016). The textile and garment sector is ranked number two after electronics

(computers, phones and parts) in generating total foreign exchange (Fig. 1), which greatly influences

the country’s gross national product (GNP) and budget (News, 2017).

Fig. 1. Vietnam’s export components from 2011 to 2016 [3] (source: General Statistics Office of

Vietnam (2017), and Vietnam Logistics Review (2017)) (News, 2017).

From Fig. 1, it can be observed that textiles were the major export of Vietnam until the end of 2011,

where they were superseded by the electronics sector (Anjoran, 2017). This decrease in textile

exports can be attributed to (1) the lower cost of textiles compared to electronics and (2) the rapid

growth of the global electronics market due to the computerization of many operations. A report
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published in 1998 stated that textile and garment exports were second after oil exports (Hill, 1998).

According to the Vietnam Logistics Review (2017), machines, equipment and spare parts ranked first

with US$34,505 million, followed by cell phones and accessories with US$24,982 million, electronics

and computers with US$18,982 million, and textiles and garments with US$18,480 million in fourth

place. Hence, it can be concluded that textile and garment exports are a mainstay of Vietnam’s

economy.

The total export value for Vietnam’s garment industries has been steadily increasing every year.

According to the General Department of Vietnam Customs (2017), there has been a significant

increase in the total export and import turnover in Vietnam: US$162.45 billion in the first five

months of 2017, which is an increase of 21.5% compared to the same period in 2016 (News, 2017).

The growth rate of the textile and garment sector was 5.2% in 2016, placing Vietnam among the top

seven exporters in the world. With the Trans-Pacific Partnership (TPP), exports increased by 13–20%

per annum until 2017, with a total export value of US$31 billion, up from the previous year’s figure

of US$27.5 billion.

Vietnam exports textiles and garments to over 180 countries and territories. Among these, the US

has been the leading export destination since 2011 (Fig. 2) (News, 2017). It has been projected that

Vietnamese exports to the US will reach US$16.4 billion by 2025, which will be the highest figure

among the five developing countries (Vietnam, India, Indonesia, Mexico and Bangladesh). This

estimation is based only on the assumption that the present trends will continue and does not

necessarily include the impact of the TPP. It can be observed from Fig. 3 that the major export

destination of Vietnamese textiles and garments in 2014 was the US, accounting for a 47.8% share of

the entire world market. After the US, the other leading export destinations of Vietnam’s textiles

and garments are the European Union (EU), Japan and South Korea (Hill, 2000).
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The US textile and apparel imports from second-tier countries

20
US$ (BILLION)

10

0 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025
Vietnam 2.8 4.7 5.2 7 8.2 9.9 11 12.1 12.8 14.9 16.1
India 4.5 5.1 4.5 6 6.2 6.6 7.1 7.9 8.2 8.8 9.2
Indonesia 3.8 4.2 4.1 5.1 5.3 5.7 5.9 6.1 6.3 6.5 7
Mexico 7.1 5.6 4 4.7 4.4 4.2 4.2 4.1 4 4 4
Bangladesh 2.4 5.2 3.7 4.4 5.1 5.9 6.3 5.2 8 8.3 9.2

Fig. 2. The US textile and apparel imports from second-tier countries (2005-2025) (News, 2017).

47.8%
50.0%

40.0%

30.0%

20.0% 12.4%
8.9%
10.0% 3.8% 3.5% 2.8% 2.4% 2.2% 1.8% 1.0%
0.0%
S

EA

AN
U

AN

AD

IN

D
PA

AI
R

IW
E

SP

H
JA

KO

AN

LA
TH

TH

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ER

ER
C
TH

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ET
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Fig. 3. Vietnam’s textile and garment export structure by the market in the first 8 months of 2014

adopted from News (2017).

To address our research questions, researchers undertook a four-step approach to identify the

trends and research scope in this discipline, as illustrated in Fig. 4.

2.1.1 Logistics service providers

Logistics service providers (LSPs) play a vital role in supply chain activities (Christopher, 2016). A

report published by the Vietnam Logistics Business Association mentioned an average growth of 20–

24% every year, although the outsourcing logistics market contributes only 3–4% of the country’s

total GDP (Nadvi et al., 2004). In the financial year 2014–15, approximately 80% of the LSPs in
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Vietnam achieved or exceeded their annual target, which indicates that there is a tremendous

growth in the logistics sector. Additionally, a 5% increase in using LSPs in 2016 indicated a rise of the

logistics sector (Review, 2016; Akbari, 2018).

The World Bank forecast in 2015 showed that Vietnam will achieve 12% economic growth by 2020,

with an export-import turnover of about $623 billion (Organisation, 2016). This growth will attract

more foreign investors to relocate their production and sourcing activities in Vietnam. This high

economic growth will require better services from LSPs. The high demand for logistics services has

been catered to by both local and international LSPs in Vietnam. However, to date many local LSPs

have not established an infrastructure to meet exporters’ requirements. Hence, exporters must seek

out international LSPs.

According to the Asian Development Bank (Asian-Development-Bank, 2010), as there are some

unclear strategies in Vietnam’s national logistics development, it is necessary to illuminate the role

of logistics-related experts and authorities in the country. Moreover, a report published by the

World Bank in 2014 illustrated the challenges to and opportunities of Vietnam’s logistics sector. It

also highlighted that there was some confusion in government regulations, which resulted in an

inconsistent understanding and execution not only across provinces but also among government

officials (Banomyong et al., 2015). It is important to mention that logistics is a relatively new term in

Vietnam, and hence there is no official department or organization responsible for logistics. The

result has been a lack of comprehensive strategies by the Vietnamese government to develop

logistics in the country (Banomyong et al., 2015).

The major challenges faced by Vietnam’s logistics sector are the following: (a) duplicated inventory

deployment, (b) lack of cooperation among the key players in the supply chain, (c) high inventory

carrying costs, (d) insufficient and unsuitable warehouses and (e) forecast errors (Hill, 2000). To
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address the above issues, famous fashion brands such as “Zara” in Vietnam have adopted three

feasible strategies: (a) Collaborative planning, forecasting and replenishment (CPFR), (b) Third-party

logistics (3PLs) and (c) Warehouse management system (WMS) (Vietnamcupplychain.com, 2014).

These strategies can generally reduce the overall logistics costs, increase the accuracy rate in

forecasting, and decrease stock-outs. In the long term, these strategies help in strengthening the

collaboration among all key players in the supply chain, generating higher revenues for all the

parties involved.

2.1.2 Third-party logistics

Since 1990, the importance of outsourcing has increased remarkably among supply chain

practitioners (Akbari and Hopkins, 2016). Once considered an integral part of business, logistics

activities are not a part of their core competencies (Marasco, 2008). This practice places third-party

service providers in an important position in the efficient management of the supply chain

(Christopher, 2016). TPL providers are third-party businesses and work for a company’s or

customer’s logistics and distribution activities (Akbari, 2018). TPL providers are involved with

functions such as packaging, labeling, transportation, warehousing and distribution as per the

customer's requirements. In some cases, TPL providers can also be involved in value-added services.

TPL providers can be of various types, such as LSPs, freight forwarders, and courier companies.

Fashion brands rely on TPL providers for many of their supply chain activities. By doing so, the

brands can be more focused on their core competencies so that their business objectives are met. In

addition, TPL providers may have better expertise and global connections than the manufacturing

companies, which can help in resolving the problems that arise during supply chain activities. TPL

providers constantly update their technology and facilities, which can be used by manufacturing and

hiring companies to help them reduce costs and save time, the keys to any successful business.
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However, outsourcing TPL services has some disadvantages, such as the loss of control and divulging

sensitive information.

Logistics play a prominent role in any country’s economy, and Vietnam is no exception. According to

Banomyong et al. (2015), logistics is one of the main outflows for businesses and therefore affects,

and is affected by, other economic activities. Moreover, logistics facilitate some economic

transaction movements, including product and service flow. International LSPs, such as DHL, Kuehne

+ Nagel, Damco, FedEx, FPL and DB Schenker, operate in Vietnam, and several local logistics service

providers have also appeared: Gemadept, SNP, Vinafco, Vinafreight, Viconship, Vietfracht, Transimex

Saigon, and Sotrans. Among these, Gemadepot has shown tremendous growth, with 40 major clients

including Samsung.

According to the World Bank (2015) report, the logistics costs in Vietnam comprise approximately

25% of the GDP, which is higher than those of its neighboring countries (i.e., 19% in Thailand, 18% in

China, 11% in Japan and 8% in Singapore) (Organisation, 2016). Despite their high growth, local LSPs

can only cater to simple jobs in the service market, as they lack specialized logistics equipment and

technology. Vietnamese LSPs often outsource to foreign logistics firms to resolve these problems.

Many of Vietnam’s logistics activities have been taken over by foreign firms (Business, 2015).

Vietnam houses approximately 1300 logistics operations operating in shipping, transportation,

warehousing, seaports, loading and unloading distribution and integrated logistics providers

(Business, 2015). Among these, up to 72% are small-to-medium-sized and lack advanced facilities.

2.1.3 Transportation

For export destinations such as the US, the European Union (EU) and other countries, generally the

freight is sent via ocean transportation and garments are sent to Vietnam’s major ports by truck

from free on board (FOB) manufacturers. Vietnam has approximately 114 ports along the 3200 km of
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coastline and 44 national waterway routes (Anjoran, 2017). Of those 114 ports, only 14 are major

ports; these are relatively large and have modern facilities, and they are the key to Vietnam’s

economic development (Review, 2016). However, many of the other major ports lack modern

facilities, which lowers Vietnam’s rank in the world’s logistical infrastructure, as indicated by the

survey in Table 1 (News, 2017).

Table 1

Quality of Vietnam’s logistical infrastructure at world scale

Infrastructure World average Vietnam’s score Ranking

score

Quality of roads 4.0 2.7 117 out of 139

Quality of railroad 3.2 2.9 59 out of 116

infrastructure

Quality of port 4.3 3.6 97 out of 139

infrastructure

Source: The world economic forum: The Global Competitiveness Report (2010-2011)

From the above table, it can be observed that the logistical infrastructure is the weak point for the

manufacturing sectors, including the textile and garment sector. The freight infrastructure score for

Vietnam is significantly lower in all the modes of transportation covered by the survey. This poor

infrastructure has led to high internal freight costs. Furthermore, the cost involved in the export and

import per container (in US$) is shown in Table 2 (Organisation, 2016).

Table 2

Cost incurred in the export and import per container for various countries

Country Cost to export (US$ per Cost to import (US$ per

container) container)
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Malaysia 450 450

Singapore 456 439

China 500 545

Hong Kong 625 583

Thailand 625 795

Vietnam 756 940

Source: The world bank’s doing business 2010

From Table 2, it can be observed that both the “per container” export and import costs are higher in

the case of Vietnam, and these costs are the highest among the six developing countries in Asia (i.e.,

Malaysia, Singapore, China, Hong Kong, Thailand and Vietnam) (Business, 2015). Poor infrastructure;

lack of modern facilities for loading and unloading; inefficient tracking of objects in transit; poor

implementation of radio frequency identification (RFID) in the supply chain; lack of proper

warehousing facilities and poor inventory management systems in the warehouses have led to the

high per-container cost (Nayak et al., 2015).

The logistics sector in Vietnam is also suffering from the lack of use of information technology (IT)

and Enterprise Resource Planning (ERP). It has been reported that only 10% of logistics providers use

the ERP software and only 17% use Electronic Data Interchange (EDI) (Goto et al., 2011). However,

most of these providers use customs and accounting software for record keeping and data

management. It was found that only 19% of enterprises use transportation management systems

(TMS), 29% use global positioning systems (GPS) and 17% use bar code systems in combination with

warehouse management software to manage the transportation of goods.

The Vietnamese government is focusing on increasing investment in the infrastructure, e-commerce,

technology and urban retail distribution system. While promoting local LSPs, the government should

also boost acquisitions and mergers and facilitate the growth of foreign logistics companies
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(Business, 2015). Furthermore, the development of logistics should be linked to the development of

industrial zones, seaports and coastal economic zones. The government’s attempts to improve the

country’s ports and infrastructure can be successful only in collaboration with private firms.

Ports play an important role in reducing the cost of freight and attract more foreign buyers. It has

been observed that the total freight traffic volume of Vietnam is increasing year by year (Fig. 5),

which indicates increased trade in terms of exports and imports (Fig. 6) (News, 2017). This traffic

volume will further increase with recent developments in the infrastructure and technology of the

Saigon port complex, which will help the export processing zones of Ho Chi Minh City, Binh Duong,

Dong Nai and Ba Ria and Vung Tau. Two additional new ports in Dung Quat and Quang Ninh will also

supplement Saigon’s port capacity.

Fig. 5. Vietnam’s total freight traffic volume and external trade (e = estimate; Source: General

Statistics Office of Vietnam) (News, 2017).

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Fig. 6. Vietnam’s export and Import Value (2001-2015) (Source: General Statistics Office of Vietnam)

(News, 2017).

2.2 Environmental concerns

The concept of sustainability is gaining increased global attention in the supply chain of fashion and

textiles, as it has in other sectors (Choi and Cheng, 2015). Often it might happen that firms’

stakeholders hold a firm responsible for any nonsustainable supply chain activity (Wilhelm et al.,

2016). Stricter international and local regulations, customer awareness and increased competition

are the main driving forces behind sustainability (Amaeshi et al., 2008; Shen et al., 2014). Hence,

fashion brands are involved in research and development to achieve SSCM. SSCM encompasses

three areas: (a) environmental, (b) social and (c) economic. These are known as the triple bottom

line (TBL) of sustainability (Hedberg and Von Malmborg, 2003; Milne and Gray, 2013).

SSCM integrates sustainability into the supply chain and can be defined as “the management of

material, information and capital flow as well as the cooperation among companies along the supply

chain while taking goals from all three dimensions or the TBL of sustainable development...into

account, which are derived from customer and stakeholder requirements” (Seuring and Müller,

2008). The implications of SSCM can vary from one supply chain to the other depending on the

structure of the specific supply chain. For example, the sustainability requirements of a supply chain
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for children’s toys are reasonably different from that of the garment industry (Turker and Altuntas,

2014).

It is common in a supply chain for some activities of the suppliers or subsuppliers not to follow

sustainability guidelines, and this affects the brand’s reputation. A good example is Mattel, the

American multinational toy manufacturing company, who had to recall some toys because they

contained toxic materials. The investigation revealed that the source of these toxic products was one

of the subcontractors of the first-tier supplier. Another example is Zara’s (Inditex group) main

supplier, AHA. Inditex was frequently criticized for its working conditions while taking no

responsibility for AHA’s facilities (Burgen and Phillips, 2011). Brazilian authorities later reacted to the

case and announced that the company must have known for whom they were producing garments

and must provide adequate working conditions.

The examples above illustrate the importance of sustainable supply chain management of both

direct and indirect suppliers (Burgen and Phillips, 2011; Wilhelm et al., 2016). Hence, the purpose of

this paper is to investigate the sustainability awareness of the Vietnamese fashion and retail

industries. We now turn to a discussion of the status of Vietnam’s garment and textile industries on

the TBL of sustainability and the views expressed by stakeholders. Many early studies were only one-

dimensional, focusing mainly on environmental aspects. However, in this paper, the views expressed

by the five participants relate to the entire TBL of sustainability.

2.3 Research Gap

In the last two decades, approximately 20 papers have been published relating to SSCM in the textile

and garment supply chain. Most of the publications focus on developed countries such as UK, Italy,

Hong Kong, and the US. Some publications are generic, presenting the fundamental concept of SSCM

in fashion and textiles (Diabat et al., 2014) or the environmental impact of reuse and recycling
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(Sandin and Peters, 2018). All of these papers have tried to address some or all the three aspects of

sustainability in fashion SSCM and have differing views on the definition of SSCM in fashion.

However, a few papers have tried to address SSCM concerns in emerging economies such as

Vietnam. Table 3 provides a brief overview of research on the concept of SSCM relating to fashion

supply chain management in developed and developing countries.

 Table 3

Research publications on SSCM in fashion (2000-2018).

NO. Reference Country Environmental Social Economic Findings

1. (Allwood et al., UK X X X The three aspects of sustainability were impacted; environmental (toxic chemicals in cotton production, release of waste or e-waste

2008) from processing plants and solid waste generation); social (unskilled workers with low income, abuse from employers and lacking

proper representation); and economic (shifting manufacturing to other Asian countries has a larger impact on the economy).

2. (Caniato et al., Global X Large companies focus on product and process development, whereas small companies focus on reshaping the supply chain

2012) management (such as using local suppliers or natural drying) for environmental sustainability.

3. (Sandin and Global X Textile reuse and recycling reduce environmental impact compared to landfill and incineration; reuse is more beneficial than

Peters, 2018) recycling. However, the production rate of new products decreases and reuse related transport and processing can cause more

environmental impact than the new products.

4. (Diabat et al., India X The textile industries have good environmental awareness but require more motivation to adopt SSCM. Enablers such as employee

2014) involvement, stability and community economic enablers were the important for implementing SSCM.

5. (Ahi and Searcy, Global X X X Identified 12 definitions for SSCM and 22 definitions for GSCM based on 7 business characteristics (environmental, economic, social,

2013) stakeholder, volunteer, resilience and long-term focuses) and 7 SSCM characteristics (flow, coordination, stake-holder, relationship,

value efficiency and performance).

6. (De Brito et al., Europe X Sustainability is an important issue in Europe due to inherent high resource use and the shifting of manufacturing to countries with

2008) lenient social and environmental concerns. Considerable changes with suppliers and the internal supply chain can be sustainable.

7. (Pui-Yan Ho and Hong X The adoption of SSCM and GSCM can help industries become low-impact organizations and gain a competitive advantage. Fashion

Choi, 2012) Kong brands should focus on product development process and implement stewardship across the multiple life cycles of the product to
 initiate a green initiative.

8. (Clancy et al., Sweden X The application of ecolabeling criteria marginally influences the clothing's sustainability performance. To achieve increased

2015) sustainability in the textile industry, it is essential to use the sustainability information in the design process already available and to

expand expertise. Designers can play a leading role by formulating sustainable design concepts for the companies for which they

work.

9. (Niinimäki and Global X Designing and manufacturing strategies such as extending product life spans through an improved intrinsic quality and a lifetime

Hassi, 2011) guarantee, product satisfaction and product attachment; developing new value for the product or its use through service thinking;

redesigning production and consumption strategies; and changing competitiveness can help the textile and clothing industries reduce

their environmental impact.

10. (Todeschini et Global X X This study investigated various innovative business models in technological innovations (zero waste, sustainable raw material,

al., 2017) wearable technology, and consumer awareness); collaborative consumption (second-hand clothing, clothing exchange and fashion

library); CSR (sweatshop-free, fair trade and local sourcing); and circular economy (recycling, upcycling and vegan) in the fashion

industry that can help achieve sustainability.

11. (Turker and Global X X X This study used Seuring and Müller’s (Seuring and Müller, 2008) model for the fast fashion industry and found that many fast fashion

Altuntas, 2014) industries ascribe significant importance to the code of conduct being complied by suppliers; strictly monitor and audit the processes

to monitor the sustainability problems in developing countries; and set sustainability criteria for their suppliers.

12. (Nagurney and Global X This study developed a new model for the fashion supply chain in the case of differentiated products including environmental

Yu, 2012) concerns. The study demonstrated that consumers can favor firms that adopt an environmental approach to become more

sustainable.

13. (Li et al., 2014) Global X The study established that a corporation should strengthen its internal governance and effectively collaborate with stakeholders to
achieve sustainability in the fast fashion supply chain management.
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3 Methodology

3.1 Prelude to the literature and steps for data collection

The study followed a four-step approach to investigate the recent trends in and the scope of fashion

supply chain operations in Vietnam (see Fig. 4). This research begins by collecting information

through the literature, as mentioned in step 1 (data collection), followed by classification and

codification (step 2), input of industry experts (step 3) and analysis of the above three inputs (step

4).

Step 1: An important phase of an exploratory study is to collect and review the existing literature

and the available information to shape conceptual knowledge (Akbari, 2018; Rousseau et al., 2008;

Denyer and Tranfield, 2009). The literature and information presented in this paper have been

collected from various sources, such as industry reviews, fashion magazines, company websites,

research publications, trade journals and government statistics. We have focused on publications

within the last two decades, primarily emphasizing the last decade. However, in some instances,

older papers were also considered if they were relevant to this study.

Various databases such as Scopus, Sci-founder scholar, Google Scholar, EBSCOhost, and JSTOR were

used to collect the literature. Keywords such as Fashion Supply Chain, Retail, Sustainable Fashion

and/or Textiles, Environmental Sustainability, Corporate Social Responsibility, Economic

Sustainability, Garment, Retail and Third-Party Logistics (TPL) were used as search terms. A total of

96 papers were collected using these keywords, of which 53 were included for analysis, based on

research findings focusing on the triple bottom line of the fashion supply chain in developed and

developing countries.

Steps 2: The above sources were classified, categorized, thematically analyzed and the major

findings were included in the paper. Data were sorted, and hierarchical coding was adopted using
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the keywords by successively narrowing to more specific ones (such as Sustainable Fashion and/or

Textiles, Environmental Sustainability, Corporate Social Responsibility) to explore the themes and

extract information (King, 2012). Important information relating to the fashion supply chain of

Vietnam and the sustainable fashion supply chain was reported in appropriate sections.

Step 3: The views expressed by three garment manufacturing industries and two fashion retail stores

during the interviews are also included to demonstrate the sustainable approaches in Vietnam. The

industries were selected based on their Vietnamese ownership and the sustainability information

available at their website. These industries have been operating for the last 20 years and deal with

local and international brands. The retail stores were selected based on the information available on

their website and based on their origin (i.e., one local and one overseas). Interviews, which lasted for

approximately 20 minutes, were conducted on the premises of the industries. The views expressed

by the participants were noted by two of the authors during the interviews. Subsequently, the data

were analyzed and included in the paper.

Step 4: The outcomes were identified to conclude the research paper: (a) research findings, and (b)

limitations and future directions in supply chain management in the Vietnamese fashion industry.
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Fig. 4. Review the methodology and steps applied in this study, adapted from (Akbari and Hopkins,

2018; Cho and Liu, 2018)

3.2 Stakeholders’ profiles

The sustainability approaches adopted by the fashion industries and retailers in Vietnam were

collected as a short survey from three leading garment manufacturing industries and two fashion

retailers in Vietnam. Each stakeholder was asked a series of question(s) relating to the triple bottom

line (TBL) of sustainability, which has been discussed in section 6. The technical officers working on

the TBL of sustainability from the manufacturing industries were selected, as were the retail

managers working on sustainability from the retail stores. The questions were asked during a formal
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meeting with the stakeholders and their responses were noted. Their answers have been discussed

in section 6. The stakeholders’ profiles are summarized in Table 4.

 Table 4 Stakeholders’ profiles

Stakeholders Interviewee Particulars of stakeholders Description

A Marketing Origin Vietnamese

manager Product type Knits and woven

Industry profile Vertically integrated

Target market Domestic and international

Number of employees 6200

Policies Acquiring new technologies, empowering employees with required skills, practice CSR and environmental sustainability.

B Managing Origin Vietnamese

director Product type Knits

Industry profile Manufacturer of garments only

Target market Domestic and international

Number of employees 3700

Policies Investing on technology; implementing lean manufacturing and enterprise resource planning (ERP); sources fabrics, trims

and accessories from China, Hong Kong, Cambodia and other Asian countries, with sustainability certifications.

C Owner Origin Vietnamese

Product type Knits

 Industry profile Manufacturer of garments only

Target market Domestic and international

Number of employees 650

Policies Focuses on the CSR (through SA 8000) and works to improve the environmental pollution norms (through Oeko-Tex

standards). Yarn and fabric are mainly imported from overseas (Hong Kong, China and Thailand), with eco-certification.

D Sustainability Origin Global

manager Product type Children’s, men’s and women’s wear; accessories

Years in operation 4

Target customer All age groups

Number of employees 45

Policies Sustainable products, ethical sourcing and circular economy.

E Owner Originality Vietnamese

Product type Children’s, men’s and women’s wear; accessories

Years in operation 15

Target customer All age groups

Number of employees 82

Policies Focuses on current fashion trends and deals with sustainable products.
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4 Results and discussion

4.1 Environmental issues

The globalization of textile and garment manufacturing has already shifted to developing countries

in Asia, including Vietnam (Nayak and Padhye, 2015a). The manufacturing of textiles and garments is

the second most polluting industry after the oil sector in many developing countries (Yusuff and

Sonibare, 2004). The increased number of industries and increased transportation cause air pollution

due to the release of carbon dioxide (CO2) and other greenhouse gases (GHG). Textile and garment

manufacturing processes, especially chemical processing, require a large amount of fresh water and

generate a large amount of wastewater, which is discharged into water systems such as rivers, lakes

or oceans (Caniato et al., 2012). Hence, environmental issues are the most important concern

relating to the manufacturing of textiles and garments.

4.1.1 Vietnam’s status

It has been reported that the vast majority of Vietnam’s water system has been polluted, resulting in

80% of the total illnesses in Vietnam (Nham and Wang, 2017). The soil in Vietnam has also been

polluted due to the use of pesticides while cultivating fibers such as cotton (EJ-Foundation, 2015).

Furthermore, there have been reports of tons of waste generated from the textile and garment

industries that are sent to landfill (Birtwistle and Moore, 2007), which is not the best solution for

managing waste. Alternative approaches for reducing, reusing and recycling waste should be devised

and practiced.

A report published in 2017 (Nguyen, 2017) mentioned that awareness of reuse, recycling, and eco-

friendly production and packaging is low among Vietnamese consumers. Vietnam is number four in

the world of countries discharging plastic waste into the sea, something that foreign and local
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tourists have complained about. Furthermore, the increased fashion awareness and buying capacity

of customers has led to the rejection of more garments, which go into landfills. On the other hand,

the number of companies and NGOs working on the recycling or upcycling of old clothes is very low

(Coworking-Vietnam, 2016). Hence, many end-of-life clothes end up in landfills, which is a serious

environmental concern.

The air quality of Vietnam has quickly deteriorated due to rapid industrialization and transportation.

Vietnam’s garment exports have almost increased by 25-fold in the last 20 years (Lotova, 2017). It

was reported in 2016 that Vietnam’s smog levels have exceeded those of Delhi and Beijing. A WHO

(World Health Organization) report published in 2012 reported 30,000 premature deaths in Vietnam

due to air pollution (Yusuff and Sonibare, 2004). In addition, Vietnam’s policy of promoting thermal

power plants has also greatly contributed to air pollution. There will be more premature deaths in

the future as the government’s plans to increase the number of thermal power plants to meet

energy demands.

4.1.2 Stakeholders’ views

Stakeholder A is involved in the manufacturing of garments for various international brands such as

Tommy Hilfiger, Perry Ellis, JC Penny, Ralph Lauren, Calvin Klein and others. Before signing contracts,

many of these brands verified industry certifications to ensure environmental standards are met. To

meet the demand of international brands, this company always tried to obtain various certifications

and is already the winner of ISO 9001 (for quality management systems), 14001 (for environmental

management) and Oeko-Tex 100 (for products free of harmful substances) (Wiengarten et al., 2013).

Stakeholder A also has effluent treatment facilities in many of its chemical processing units, and

these facilities deliver water that is even drinkable. Stakeholder A always complies with the

specifications set by the local authorities in terms of the Biological Oxygen Demand (BOD), Chemical

Oxygen Demand (COD) and Total Dissolved Salt (TDS) on the effluents.
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Stakeholder B specified that its focus is on the use of sustainable fibers such as organic cotton, low

chemical cotton, bamboo and lyocell. As per the buyers’ requirement on sustainable fibers,

Stakeholder B sources the materials, including fiber, yarn and fabric, to manufacture the garments.

Stakeholder B can also produce the fabric from the sourced yarn in its local production facilities.

Stakeholder B is also the winner of Oeko-Tex 100 and ISO 14001. In addition, some of its production

centers are in the industrial zones, where the wastewater is treated in common facilities before

being discharged.

Stakeholder C is the winner of Oeko-Tex 100 and an ISO 9001 certificate. As its major activity is in

knitted garment manufacturing, Stakeholder C is not involved in the textile chemical processing that

generates a large amount of wastewater, which reduces a substantial amount of pollution (Fletcher,

2013). Stakeholder C is devising the norms set by the local authorities in terms of hard waste

generation and air pollution. Stakeholder C also uses digital printing for sampling purposes, which is

almost free from effluent and considered the future sustainable technology (Chen et al., 2015).

Stakeholder D expressed that it is one of the retail leaders in sustainable sourcing and supply chain.

This retailer responsibly sources products from the suppliers or manufacturers who meet green and

ethical manufacturing practices. Hence, Stakeholder D determines whether the certificates won by

the supply chain partner meet global requirements or not. The retailer evaluates the suppliers

against some set criteria and measures the efficiency. Stakeholder D also employs certifying agencies

to measure the efficiency and reward the suppliers, which score the highest on the score sheet.

However, practices to make the retail store sustainable have not yet been effected. In the future,

the retailer plans to rely on the energy from renewable sources. Hence, as mentioned by Brito et al.

(De Brito et al., 2008), the fashion retailer is moving toward a sustainable supply chain.
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During the interview with Stakeholder E, the owner mentioned that the company always emphasizes

fulfilling the customer’s preferences in terms of style and fit. However, Stakeholder E understands

that the sustainability concept will shape the future of fashion. Hence, the brand has only begun to

understand and adopt the sustainability concepts in its supply chain by adopting eco-friendly

practices such as not using toxic chemicals in textile processing, using natural dyes and sourcing

some products from manufacturers with environmental certification (De Brito et al., 2008).

4.1.3 Significant findings

From the stakeholders’ viewpoints, it can be concluded that the manufacturing industries and retail

stores in Vietnam are aware of environmental sustainability as evidenced by effluent treatment

plants, environmental management certifications, complying with BOD, COD and TDS norms, the use

of sustainable raw materials, the use of digital printing, and sustainable sourcing. The significant

findings in environmental sustainability are:

 Adoption of an environmental management system (EMS): As mentioned by Wiengarten et

al. (Wiengarten et al., 2013), fashion manufacturers and retailers in Vietnam are adopting

EMSs such as ISO 14000 or Oeko-Tex 100 in order to reduce the environmental impacts of

the fashion supply chain. In addition, compliance with the BOD, COD and TDS indicates

sustainable manufacturing methods in the upstream fashion supply chain processes (Alkaya

and Demirer, 2014).

 Use of sustainable raw materials: Use of sustainable raw materials (i.e., fibers) such as

organic cotton and recycled polyester fiber shows that Vietnamese fashion industries are on

a journey toward sustainable fashion (Fletcher, 2013). However, the high cost of the

garments made from sustainable materials may be a hindrance to their wider acceptance.

 Sustainable sourcing: According to Seuring (Seuring, 2004), fashion companies demanding

that their suppliers improve their environmental performance through various certifications
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is a sign of sustainable sourcing practices, which were also found in this study in Vietnam’s

fashion supply chain.

4.2 Labor issues

There are two major impacts of globalization on the labor force: (a) the shift of production from

developed countries has produced substantial job losses in textile and garment manufacturing, and

(b) laborers working in developing countries suffer from labor-related problems such as low wages,

overtime without pay, no leave, unsafe working conditions, and lack of sanitary facilities. The other

problems are child labor, forced labor, unavailability of safety working aids and even no maternity

leave. The inability of private farms to meet the labor rights and living wages in developing countries

such as Vietnam has been reported by several researchers (Anner, 2012; Egels-Zandén, 2007).

It has been reported that the workers are paid lower wages to maintain low production costs

(Flanagan, 2006). The buyer-driven regulations in garment and textile production have led to

disappointing outcomes, as additional expenses are incurred to provide safe and healthy working

conditions, which increases production costs. Various labor unions have played significant roles in

reducing accidents, as indicated in several publications (Gregoratti and Miller, 2011; Helfen and

Fichter, 2013; Oka, 2016). The labor laws in many countries specify no discrimination relating to

gender, marital status, race, religion, social status and union membership. Men and women who

work in similar positions should receive the same benefits and career growth. Employers should not

discriminate against disabled persons but rather create favorable conditions for anyone with a

disability.

4.2.1 Vietnam’s status

The Vietnamese General Confederation of Labor (VGCL) and their official labor newspapers govern

the labor market and policies (Ngoc Tran, 2007). The progressive Vietnamese Labor Code that was
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implemented in January 1995 specifies all work and pay conditions and nonwage benefits (Tran,

2013). However, there have been several amendments to this code in many areas. As per the law,

the wages paid to the employees should meet the minimum wage set by the government, and this

should be mentioned in the labor contract, including the wage allowances and other additional

benefits. The allowance should take into consideration the complexity of jobs, working conditions

and hazards. Allowances should also be given to employees with higher outputs.

The minimum wage levels for the workforce employed in the private manufacturing sector were

created beginning on January 1, 2013 (Lotova, 2016). The wage levels vary in the four regions of

Vietnam: (a) zone one: urban Hanoi and Ho Chi Minh City; (b) zone two: rural Hanoi and Ho Chi Minh

City, including urban Can Tho, Da Nang and Hai Phong; (c) zone three: the provincial cities and

districts of Bac Ninh, Bac Giang, Hai Duong, and Vinh Phuc and (d) zone four: the remaining localities.

The average monthly wage was set at VND2.7 million ($128) w.e.f. January 1, 2014, which was

increased from VND1.9 million ($89.3) in 2013. As per 2015 data published by the Fair Work

Foundation (FWF), a worker’s minimum wage can only fulfil 75% of one’s basic needs (Foundation,

2015). As the interest in international brands from Europe and the US is increasing, the garment

industries are increasingly paying attention to the salaries of workers and to joining standard bodies

such as the FWF.

A survey commissioned by the Vietnamese government and the international labor organization

(ILO) estimated that approximately 6049 child laborers work in textile and garment manufacturing

(ILO, 2014). Of these, approximately 43% are under 15 years of age. Female child workers comprised

approximately 96% of the total number of children employed. The survey also reported that

approximately 1426 child laborers work in the leather industry, in areas such as tanning,

preprocessing and animal-skin dyeing. Of that total, 74% are girls, 580 children are between twelve

and fourteen years of age, and 846 are between fifteen and seventeen years of age. Furthermore, it
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was reported that in footwear manufacturing, approximately 9756 child laborers work in excess of

42 hours per week. Of these, 2.2% were in the twelve-to-fifteen age group, with the remaining

97.8% in the fifteen-to-seventeen age groups.

A survey found that more than 80% of the textile and garment industries violated the labor policies

in 2015 relating to duration of shift, rest period and other safety regulations. The average overtime

per annum can be within 200–300 hours per annum per employee. This amount is decreasing in

larger firms due to stricter laws from the ILO and policies of the fashion brands. However, local

manufacturer’s take advantage of the lack of inspections or of the poverty of the workers. Labor

exploitation, for example wage-cuts or working overtime without pay, is present in some industries,

but this exploitation is somewhat lower than that found in Bangladesh (Azizul Islam and Deegan,

2008).

4.2.2 Stakeholders’ views

Stakeholders A and B mentioned taking special care of workers through various policies that

emphasize that the productivity and efficiency of the farm relies on the “physical wellbeing and

mental health of the workers” (Oxenburgh et al., 2004). Hence, activities such as cultural programs,

sports among staff members, family events and annual events are organized to increase the

awareness of the employees. Stakeholder A provides additional benefits to workers by providing in-

house shopping facilities, childcare facilities for working mothers, and pickup and drop-off services

to-and-from home to workplace. Stakeholder C did not wish to discuss the facilities provided for

workers even though there were some programs for workers’ welfare. However, Stakeholder C also

organizes regular activities for employees and their families every year to improve their feeling of

belongingness.
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Stakeholder A described how the company took special care of the workers beginning with

employment. The company even hires unskilled labor and provides all their necessary employment

training. The company organizes regular training in how to enhance their skills, save energy, become

productive and work on a team. This farm also provides incentives to workers with higher

productivity. However, Stakeholders B and C recruit workers with the necessary skills required for

work, provide additional training when needed and provide incentives to workers with higher

productivity.

All the three manufacturing stakeholders (A, B and C) mentioned that they do not employ child labor

at any stage of textile and garment manufacturing. All three agreed on some common points, such

as on-time payment to workers, payment for overtime if any, and providing personal leave, sick

leave and three months maternity leave to women with a newborn baby. The stakeholders also

agreed not to use any forced labor or to pressure workers at any stage. All stakeholders agreed not

to discriminate on the base of religion, race or gender. Women are paid on par with men, and the

promotional rules are the same for both. Stakeholder A mentioned there was hardly any overtime

work, but Stakeholders B and C mentioned the use of overtime near the delivery date if there has

been any delay.

In terms of safe working conditions, all three stakeholders provide safe working conditions to their

workers. These stakeholders provide safety devices such as face masks for working in ironing or

printing, gloves for hand protection, and finger protection for working with sewing machines. All

three respondents provide good sanitary and water drinking facilities. The stakeholders also agreed

to having fire extinguishers that are operational and trained personnel to operate them, clear exit

doors at all times, first-aid kits and trained personnel, and a well-managed waste disposal system.

Stakeholder A provides workers with a well-ventilated resting area, dining spaces, and special teams
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for accident and emergency management. The salary and wages, occupational health and safety and

other facilities provided to workers by stakeholders A, B and C are summarized in Table 5.

Table 5

Summary of salary and wages, occupational health and safety and other facilities provided to

workers (by manufacturing stakeholders A, B and C)

Issues Stakeholder A Stakeholder B Stakeholder C

Minimum salary and wages As per the government As per the government As per the government

guidelines guidelines guidelines

Overtime work No Yes (to meet delivery dates) Yes (to meet delivery dates)

Payment for overtime N/A Duly paid Duly paid

Child labor No No No

Forced labor No No No

Personal & sick leave Yes Yes Yes

Maternity leave 3 months, more if needed ≤3 months ≤1 month

First aid kit Yes Yes Yes

Fire extinguishers & trained Yes Yes Yes

people to operate them

Clear fire exit doors Yes Yes Yes

Sanitary facilities Yes Yes Yes

Drinking water facilities Yes Yes Yes

Well-ventilated resting area Yes - -

Emergency team Yes No proper team; managers No proper team; supervisors

or supervisors manage in manage in emergency
emergency

Stakeholder A mentioned sourcing products from suppliers with a commitment to legal and ethical

practices. This company ensures that it has various certificates, such as the SA 8000, to show

compliance with workers’ rights in all their operational units. Stakeholder A also performs in-house
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audits or discusses its labor policies and its scope for improvement with the Fair Labor Association

and Social Accountability International. Stakeholder B wins awards every year for corporate social

accountability in addition to the SA 8000. Stakeholder C is also the winner of the SA 8000 and

received the certificate for the best employer.

Stakeholder A donates a certain amount of its income to a cancer foundation, organizes community

work and provides a scholarship for poor students. Stakeholder B organizes social charity programs

for the community, provides a scholarship to poor but diligent students, builds charity houses for the

homeless, and takes care of heroic Vietnamese mothers and families of the revolution. Despite its

policies, Stakeholder C has not made any donations or performed any charity work. The future plan

for Stakeholder C is to donate to charity and organize community-based activities.

Stakeholder D always focuses on ethical sourcing from the manufacturers who provide safe working

conditions, treat workers fairly, are free from abuse and violations, and pay fair wages to their

employees. In addition, this company follows the instructions of the United Nations (UN) Guidelines

for labor and human rights to enhance the living standard of employees and society. This

stakeholder has a zero-tolerance policy in relation to child labor employment. No player in the

supply chain should employ child labor, and the stakeholder implements robust verifications of the

employee’s age.

Stakeholder E is also at the initial stage of implementing the labor rules and regulations in their

manufacturing sector. However, global competition and stricter government regulations are driving

this brand to implement labor rules and regulations. Unlike Stakeholder D, Stakeholder E did not

follow stricter procedures to source from ethical suppliers. However, this company is giving

increased attention to ethical sourcing to compete with other global competitors.

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4.2.3 Significant findings

Fashion and textile industries in developing countries are well-known for workforce exploitation

(Lundblad and Davies, 2016). Reduced lead time and increased pressure to meet delivery dates have

resulted in employee abuse, unpaid overtime, forced labor and other unethical practices in fashion

manufacturing (Barnes and Lea-Greenwood, 2006). The significant findings in this section include:

 Worker welfare: This study established that the stakeholders in Vietnam focus on the

welfare of the workers to achieve sustainability (Jang et al., 2012). The payment of minimum

wages, the availability of sanitary facilities, drinking water and well-ventilated resting areas

are some evidence of worker welfare (Turker and Altuntas, 2014).

 Free from child and forced labor: All the fashion stakeholders mentioned that they follow a

zero-tolerance policy regarding employing child and forced labor (Turker and Altuntas,

2014). However, the employment of child and forced labor is a common problem in many

developing countries such as Bangladesh and Sri Lanka (Viederman, 2013).

 Gender equality: Gender equity, sexual abuse and women’s empowerment through

protection from discrimination in the workplace have been the focus of many industries

including fashion (Hutchens, 2010). From the stakeholders’ viewpoints, it is important that

all participants adhere to gender equality in the workplace, provide maternity leave to

pregnant women and provide necessary facilities to women with babies.

 Safe working conditions: Workplace safety is a major concern in the fashion manufacturing

process. It is evident from the stakeholders’ views that they consider workplace safety a

prime requirement, which is a pathway to sustainable fashion (Tyler et al., 2006). However,

this study also found that many fashion manufacturing industries do not focus on employing

skilled people for emergency management, which should form part of corporate

responsibility.
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4.3 Economic sustainability

4.3.1 Vietnam’s status

The majority of the demand for electricity in Vietnam is fulfilled by thermal power stations and

hydroelectricity. These thermal power stations are the major environmental polluters, as they emit

large amounts of CO2 by burning coal or fossil fuels. Although Vietnam has started to implement

various projects to generate electricity using renewable resources such as wind and solar power, a

substantial contribution is negligible for the moment. The government is planning to reduce GHG

emissions by 5% in 2020 and to promote solar energy use by 12% in 2020. Similarly, the government

is planning to increase the production and use of biofuels by 5% by 2020. In the case of renewable

raw materials, some of the fashion manufacturers and brands are seeking raw materials from

renewable resources such as plants and animals. Sustainable and renewable raw materials such as

milk fiber (casein), eacell fiber, orange fiber and soya protein fiber are being used by some industries

(Fletcher, 2013). In the future, many of the fashion brands will move toward renewable raw

materials and energy sources.

4.3.2 Stakeholders’ views

During discussions with stakeholders, it was found that economic sustainability has gained the least

attention in the manufacturing and retail sectors in Vietnam. In the manufacturing sector,

Stakeholders A and B said they would use fibers derived from renewable resources such as milk

fiber, soya fiber and recycled materials. Both explained their interest in using energy from renewable

resources such as wind and solar radiation. However, the lacks of clear government guidelines and

policies and high setup prices have prevented these companies from adopting the use of alternative

energy resources. Stakeholder E is new to the concept of raw materials and energy derived from

renewable resources.
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Stakeholder D is following economic practices by providing bags of recycled paper to their

customers. This company also uses energy-efficient LED lights in its retail environment. However, no

other approaches have been taken by the retailer to use renewable energy. Stakeholder E said it has

neither implemented economic sustainability in material selection nor has plans to use energy from

renewable resources. Both retailers noted that the lack of government policies and knowledge in

this sector is a hindrance to attaining economic sustainability.

4.3.3 Significant findings

The concept of economic sustainability includes “the economy to support a defined level of

economic production indefinitely” (Shahbaz et al., 2013). From the stakeholders’ viewpoint, it is

evident that economic sustainability has obtained the least significance in Vietnam’s fashion supply

chain. Significant findings in economic sustainability include:

 Use of renewable energy: Renewable energy (e.g., solar and wind energy) is being

increasingly used in many manufacturing industries (Reddy and Painuly, 2004). As per the

stakeholders’ viewpoints, some of the fashion manufacturers and retailers in Vietnam are

seeking alternative sources of energy to achieve economic sustainability.

 Use of renewable material: Renewable material is also gaining impetus in fashion

manufacturing (Fletcher, 2013). From the stakeholders’ viewpoints, it is evident that some

industries have started using raw materials derived from renewable resources.

5 Conclusions

As the focus of the fashion supply chain continues to be on sustainable strategies for economic,

social and environmental considerations, fashion brands are endeavoring to identify best practices

through the convergence of ecofriendly materials, ethical labor practices, renewable energy and

green manufacturing. However, the majority of published articles have focused on developed
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countries, whereas emerging countries have been overlooked. The objective of this research was to

analyze the recent trends in supply chain management and sustainability approaches for the

Vietnamese fashion and retail industries. The paper consists of two parts: the first part discusses the

reviews of the supply chain of the fashion and textile industries in Vietnam and outlines the research

methodology, and the second part analyzes the current sustainability practices in Vietnam’s fashion

and textile supply chain. A four-step approach was followed to answer the two research questions

that were formulated for this research. The significant findings of this study and its limitations and

future directions are discussed in the following section.

5.1 Significant findings

- The textile and garment industries in Vietnam are emerging to meet the global demand,

with exports to over 180 countries and territories. The concept of a sustainable supply chain

is relatively new to many of the upstream and downstream players in the supply chain.

- Stakeholders A, B, C and D are striving to achieve the triple bottom line of sustainability by

adopting the environmental management system and the use of sustainable raw materials

and sustainable sourcing; ensuring worker welfare, gender equality, safe working conditions

and not employing child and forced labor; and seeking future sustainable materials and

renewable energy resources. However, this concept is new for stakeholder E in all three

aspects of sustainability.

- All manufacturers (Stakeholders A, B and C) are aiming to achieve the concept of green

manufacturing, which is evident from their certifications, such as Oeko-Tex and ISO 14001.

Similarly, Stakeholder D always focuses on the sourcing of sustainable products

manufactured following ethical practices.

- Although the concept of renewable energy from various resources, such as wind and solar

power and sustainable raw materials, is new in Vietnam, stakeholders are willing to adopt
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these new concepts to achieve economic sustainability. However, assistance from the

Vietnamese government is needed in addition to the organizational goals. The government

should facilitate the use of energy from renewable resources. This support will help Vietnam

reduce the environmental impact and negative consequences and improve its social and

economic sustainability.

5.2 Limitations and future directions

- This study has considered the combination of three different factors comprising five

stakeholders’ perspectives, Vietnam’s status and significant findings. However, the

stakeholder’s perspectives are limited to only three in manufacturing and two in the retail

sector. This research can be extended by including more participants, other data collection

methods such as questionnaires, and by covering further industry and retail participants’

perspectives. The impact of recent changes in the foreign direct investment and trade

agreements relating to Vietnam’s fashion industry and sustainable development must also

be considered. To further extend the discipline, research should focus more closely on

neighboring countries or on the Association of Southeast Asian Nations (ASEAN) involved in

the fashion supply chain.

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