Manufacturers are leaving China for another factory relocation destination, but where are they headed?

The competitiveness of offshoring has been declining for years, as China has faced increasing wages and currency costs, as well as higher fuel and transportation costs. There are also many hidden costs and risks that are difficult to anticipate.

After years of strong economic growth, salaries of Chinese clothing makers have increased, resulting in more expensive Chinese textiles and clothing manufacturing. But while cheaper outsourcing locations such as Cambodia, Vietnam, Bangladesh and India have picked up the slack, China garment manufacturing losses may be exaggerated, experts suggest.

Best place for factory relocation after moving out of china

Rising interest in Industrial Zones (IZ) as FDI in 1H/2015 driven by textile & garment industry

Large-scale projects approved for the textile & garment industry in 1H/2015 drove the manufacturing/ processing sector, which accounted for 76% of fresh FDI commitment (US$4.18bn) to Vietnam in the period.

Upcoming Trans-Pacific Partnership (TPP) an impetus

The textile & garment industry is expected to achieve double-digit growth when the TPP is approved. The partnership stipulates that fabrics and final garments exported within the TPP should be produced in the TPP member countries. Lately investors from China, Taiwan and Hong Kong have entered the fray to be one step ahead of the TPP approval. Recent research by Standard Chartered bank, showed a shift of investment from China to the ASEAN community in a bid to capitalise on the upcoming TPP. 44 per cent of respondents said they would choose Vietnam for a large domestic market or factory relocation, 29 per cent for lower operational costs and 18 per cent for an ample labour supply. Notably, giant tech Microsoft has closed its two Nokia plants in China in favour of factory relocation in Vietnam. The company was reported to expand its US$210mn plant in Bac Ninh’s Vietnam – Singapore IZ and triple its current 5,000 head count.

National Supply

According to the Ministry of Planning and Investment, at July 2015, there were 299 Industrial Parks (IPs) in Vietnam with a total area of approximately 84,000 ha, of which the total leasable area was 56,000 ha (66%). The leased area is approximately 26,000 ha, at 46% occupancy. There are 212 operating IPs of under 60,000 ha land area, and 87 IPs of under 24,000 ha land that are under site clearance and infrastructure construction. IPs and their performances within their respective economic zones.

Best place for factory relocation after moving out of china

Long An: best factory relocation place in Southern key economic erea

Lying next to Ho Chi Minh City, Long An is a mid-sized province located within the Mekong Delta region in Southern Vietnam.  The provincial capital is Tan An, other major cities include Ben Luc, Duc Hoa, Thanh Hoa, and Moc Hoa District.  There are 13 districts within the province. Due to its proximity to Ho Chi Minh City, Long An is considered a prime location to set up manufacturing facilities or factory relocation. However, the province is still in the early stages of development and some parts of its infrastructure need to be upgraded.

The people of Long An province are well known for their tradition of “loyalty and courageousness and steadfastness of the whole population [in fighting] the enemy in battle” and for their industriousness and creativeness in their work.

The province is still mainly agricultural, but it is steadily investing more money into building up various industries, such as plastics and textiles,` throughout the region. In recent years, Long An has emerged as a key province for the attraction of investment and the development of industrial parks (IP), such as the Long Hau IP and Kizuna rental serviced factory.

Long An is home to two large universities: the Long An University of Economics and Industry, and Tan Tao University.

In 2013, Long An had a total of 37 licensed FDI projects, with US$160.3 million in registered capital.

Factory relocation – Why Kizuna?

We contribute to the development of the enterprise community in Vietnam by these achievements:

– A chain of “Serviced Factory” that helps enterprises establish their business precociously, efficiently to develop their competitive advantages.

– A friendly environment where people are encouraged to learn and develop their skills. Our team concern about teammates, family and social benefits.

– A model of perfect enterprise, in which our people master science and knowledge to conduct an effective business and durable development.

 

Best place for factory relocation after moving out of china

Kizuna 1 Rental Serviced Factory Area is attracting many foreign investors for their factory relocation by many advantages: convenient location, tax incentives, worker recruitment support, high quality infrastructure,… which help the tenants to save cost, save time and establish their business quickly and effectively.

Kizuna 2 is second phase expansion project, nearly twice of the first phase. The name of the second project is “KIZUNA 2″, is also located in Tan Kim industrial park, 1.5km away from KIZUNA 1.

1. Total area of available workshops: 42,000 m2

2. Multi sized of workshop: 290m2-1080m2

3. No. of available workshop: 57

Best place for factory relocation after moving out of china

Suitable infrastructure for factory relocation:

– Big shutter for 40 feet container

– Natural lighting system

– Loading capacity: 2tons/ m2

– Business Center

– 24/7 maintenance team & security system

– Free parking lot,…

– Services package

– Semi-customized factories due to customer’s demand

 

For more information about Best place for factory relocation after moving out of china please contact +8491 371 6703 or sales@kizuna.vn