MINISTRY OF EDUCATION AND TRAINING

FOREIGN TRADE UNIVERSITY

SCHOOL OF ECONOMIC AND INTERNATIONAL BUSINESS

INTERNATIONAL TRADE TRANSACTION REPORT

EXPORT BUSINESS PROCESS ANALYSIS:
CASE OF VIETNAM’S TEXTILES

Group : 9

Class : TMAE302(GD2-HK2-2122).1

Academic year : 2021-2022

Lecturer : Ph.D Phan Thi Thu Hien

 June, 2022
MINISTRY OF EDUCATION AND TRAINING
FOREIGN TRADE UNIVERSITY
SCHOOL OF ECONOMIC AND INTERNATIONAL BUSINESS

INTERNATIONAL TRADE TRANSACTION REPORT

EXPORT BUSINESS PROCESS ANALYSIS:
CASE OF VIETNAM’S TEXTILES

Group : 9

Class : TMAE302(GD2-HK2-2122).1

Academic year : 2021-2022

Lecturer : Ph.D Phan Thi Thu Hien

 June, 2022
GROUP 9 MEMBERS

Full name Student ID Distribution

Bùi Thu Trang 2012250071 Overview of Textiles exportation

Introduction;

Hoàng Thị Phương Thuỷ 2012250069 Sale contract of Textiles;

Conclusion

Making and Figuring Export process

Trần Thị Thanh Thảo 2013250028 of the Vietnamese trader;

Impacts of COVID 19 pandemic

Analyze export process by BPA:

Nguyễn Thị Quỳnh Trang 2012250073 descriptive bottlenecks and reasons;

Finalize report

Nguyễn Hồng Hà 2013250234 Overview of Textiles exportation

 INTRODUCTION

Over the years, Vietnam's textile and garment industry has been developing strongly
and plays an increasingly important role in the economic growth of the country. Among
all the current export industries, Textile and Garment is one of the key export industries
with high export turnover and growth rates. It accounts for 12 - 16% of the country's total
export turnover. (The Ministry of Industry and Trade, 2021)
To better understand the procedures and requirements of the textile exporting process
from Vietnam to other countries as well as skills in drafting international sale contracts,
our team is going to research export business process analysis: Case of Vietnam’s
textiles exportation. This paper consists of 4 main parts. The first part provides an
overview of Vietnam’s textile exports. Secondly, we will draft a contract for exporting
100% cotton fabric from Vietnam to one of its main textile export markets - the United
States. Then we will map out the export process of Vietnamese sellers and point out
some bottlenecks and reasons. The last part discusses some impacts of the COVID 19
pandemic on the export performance of Vietnamese businesses in the textile industry.
This report is made under the instructions and supervision of Dr. Phan Thi Thu Hien.
We are very grateful for your support and precious knowledge in the course of
International Trade Transaction. 
 ANALYSIS

OVERVIEW OF TEXTILE PRODUCTION

Domestic production and overview of Textiles exportation in Vietnam

Domestic production
In recent years, Vietnam has risen to become one of the world's leading textile
exporters. Based on export turnover in 2020, garment and textile items were among the
most important commodities. Vietnam's manufacturing industry has grown in importance
as the country's reliance on agriculture has decreased. In addition to garment export
demand, local consumer expenditure on clothing and footwear has been rapidly
increasing, owing to the enhancement of Vietnamese living standards.

·      The export turnover:

The textile and garment industry is the industry with the second largest export turnover
in the country, creating jobs for a large number of workers, specifically accounting for
more than 20% of the labor force in the industrial sector and nearly 5% of the total labor
force of the country (Le Hong Thuan, 2017). However, the export turnover is mainly
from FDI enterprises. FDI enterprises in the field of garment production account for only
about 25% in volume but contribute more than 60% of export turnover. The problem is
that domestic enterprises need to change their production methods and business
management and need support from the state to be able to break through and become
a powerhouse in this field. 

·      Number of enterprises and level of employment:

The number of enterprises in the textile and garment industry is 8,770, accounting for
about 2% of the whole country, of which there are about 30 enterprises with a scale of
more than 5,000 people. The labor force in textile industry is about 1.6 million people,
accounting for more than 12% of the labor force in the industrial sector and nearly 5% of
the total labor force of the country (Statistical yearbook of Vietnam, 2015). However, the
income of workers in the textile and garment sector is lower than the average level of
other industries.

·      Production capacity:
Vietnam is heavily reliant on imports of raw materials for apparel production. Cotton,
synthetic fiber, woolen, filament, and silk are common materials used in the textile and
garment industries. Regarding the cotton yarn segment, despite the fact that Vietnam
has a vast potential for cotton cultivation and production, local sources only supply
around 2% of total cotton demand. Vietnam’s textile and garment industry mainly
imports materials from abroad. Due to declining domestic cotton output, the country has
been a net importer of the material in recent years, with the United States serving as its
primary source. The apparel manufacturing business faces major challenges due to its
heavy reliance on imports. The government has prioritized the development of the
domestic raw material supply chain for the textile, garment, leather, and footwear
industries to meet domestic demand. 

·      Marketing activities:
Vietnamese garment businesses' distribution activities are still underdeveloped, and
they rely significantly on international dealers for garment export. To have outsourcing
contracts, Vietnamese clothing businesses still rely on regional suppliers such as Hong
Kong, Taiwan, and Korea. Only a small percentage of clothing companies have direct
contracts with shops to supply their goods. Several garment businesses in Vietnam
continue to rely on product distribution through representative offices of well-known
brands. For instance, through their representative offices in Vietnam, several local
manufacturers for Columbia, Decathlon, and other brands ship directly to foreign
corporations, Vietnamese clothing companies still lack a link to their customers. They
only work with regional producers on subcontracts. As a result, Vietnamese clothing
companies will be unable to make large profits while also mastering the global fashion
trend. In terms of garments consumed locally, distribution activities are carried out by
certain well-known Vietnamese companies, such as Canifa, NEM, Ivy Moda, Seven AM,
and Elise. However, when compared to international fashion firms that want to enter the
Vietnamese market in the future, Vietnamese businesses still have some distribution
and marketing shortcomings.

·      Orientation:
According to the Decision 3218/QD-BCT dated April 11, 2014 of the Ministry of Industry
and Trade on the development planning of Vietnam's textile and garment industry with a
vision to 2030, also orients the development of important products and fields under the
following aspects:
Firstly, strengthen the export garment industry to take advantage of market
opportunities. Taking export as the basic method for the development of the industry,
and at the same time satisfying the domestic demand to the fullest.
Second, develop a program to produce fabrics for export, focusing on developing textile
dyeing.
Thirdly, government orients to develop sources of cotton fiber materials, plants with
fibers, artificial fibers, and accessories; develop cotton growing areas in Son La, Dien
Bien, Quang Tri, Quang Binh, Ninh Thuan and Binh Thuan, develop a man-made fiber
factory in association with the petrochemical zone in Nghi Son, Thanh Hoa. At the same
time, develop textile and garment industry clusters in seven suitable and convenient
regions in terms of labor supply, traffic, and seaports.

Textiles exportation in Vietnam

Thanks to the proliferation of technology, the development of manufacturing techniques,
an increasing proportion of high-skilled workforce, and government’s incentives policies
(Tax-free on imports of capital machinery and equipment, investment incentives those
regularly employ 500 to 5,000 employees), the textile and garment industry achieved
numerous positive results, simultaneously creating export values and ensuring demand
for domestic consumption and exportation.
Textile and garment exports in April, 2022 reached 3.15 billion USD, up 3.3% over the
previous month and reached the highest value ever. In the 4 months of 2022, the export
of this group of goods reached US$ 11.83 billion, up 22.2% over the same period last
year, equivalent to an increase of US$ 2.15 billion.
 (General Department of Vietnam Customs, 2022)

Source: General Statistics Office of Vietnam

Textile and garment exports in the first four months of 2022 recorded a sharp increase
to the US market with an export value of approximately US$6 billion, up 26.8%,
equivalent to an increase of US$1.26 billion and contributing 59% to the total value of
the garment. increase in the export price of this commodity group of the whole country.
After the US main market, the export performance of 4 months from 2012 to 2022 also
shows that exports of this commodity group to the EU also increased significantly in the
first 4 months of this year, reaching nearly 1.3 billion USD, up 34.6% over the same
period last year. Next is the Japanese and Korean market, reaching 1.04 billion USD
and over 1 billion USD respectively. In general, four months of 2022 witnessed exports
of textiles and garments to most markets increased sharply compared to the previous
period in 2021.

Details about export of Textiles from Vietnam in a global scale

The history of The Vietnamese Textiles and Garments exportation

Export of textiles and garments continues to grow. In 2007, export of Vietnamese textile
and garment was US$ 7.75 billion, and in 2008, it came to US$ 9.11 billion, registering
around 18% growth over the previous year. In 2009, export earnings from textiles and
garments reached US$ 9.13 billion. In short, the textile and garment sector has made a
remarkable contribution to the economic development of Vietnam. 

Key exported products

Vietnam’s garment and textile industry consist of 3 sub-sectors: upstream sector (fiber
production), midstream sector (fabric production and dyeing), and downstream sector
(garment manufacturing).

Mainstream market 
Vietnam's textile and garment is mainly exported to the US market, accounting for
nearly 50% of the country's total export turnover of this commodity group, reaching $7.6
billion, up nearly 23% over the same period in 2020. In particular, in June 2021, exports
to this market reached $1.59 billion, an increase of 21.4% compared to May 2021 and
an increase of 18.4% compared to June 2020. The main market after the US is the
Japanese market with $1.57 billion, accounting for 10.3%, the EU market reached 1.51
billion USD,  accounting for 9.9%

(General Department of Vietnam Customs)

Modes of international trade transaction of the Vietnamese firms in the industry)

● CMT export mode (Cut – Make – Trim)

In the textile and garment industry, CMT is in short for: Cut, Make, Trim. In particular,
this term means:
• Cut: Cutting fabric from rolls of fabric according to pre-designed patterns from
customers.
• Make: Sewing, stitching, and patching fabric together into a finished product.
• Trim: Cutting the thread and cleaning the thread from clothes after stitching.
Performing inspection, finishing products, packing finished products as required.

CMT is the simplest export method. When cooperating in this mode, buyers, buying
agents and buying organizations provide the processing enterprise all of the inputs to
produce products including designs, materials, transportation,… Manufacturers will only
carry out product cutting, sewing and finishing. Enterprises who have limited production
capability and design ability should take advantage of this export mode.

● FOB export method (Free On Board)

FOB export method creates higher value compared to CMT, which is the production
method of “buying raw materials, selling products”. Businesses are actively involved in
the production process on FOB, from acquisition of raw materials to production of final
products. Unlike CMT, exporters using FOB actively buy necessary material inputs
instead of being supplied directly from their buyers. The FOB operations vary
considerably based on actual contractual relationships between the supplier and the
foreign buyer.
The methods are divided into 2 types (FOB level I and FOB level II). Regarding FOB
level I, businesses will purchase inputs from a group of  suppliers specified  by  buyers..
Regarding FOB level II, businesses will receive product designs from foreign buyers
and take full responsibility for sources of raw materials, production, and transportation of
raw materials and finished goods to ports specified by buyers. 

● ODM export method (Original Design Manufacturing)

According to the ODM method, enterprises participate not only in the input sourcing and
tailoring process but also in the design procedure. Firms will create designs and resell
the products to buyers. As a result, an ODM manufacturer is not allowed to manufacture
the same design without authorization from the buyer.
 ● OBM export method (Original Brand Manufacturing)
Accordingly, businesses are responsible for designing their own products, importing raw
materials, cutting sewing, and shipping. For OBM orders, businesses enjoy higher profit
margins than all other export forms.
 

Currently, exporting textiles and garments from Vietnam is mainly processed under
CMT method. The proportion of exports in this form accounts for about 70% of the
industry’s export turnover. The EU is one of the largest markets of Vietnam. Asian
countries such as China, Singapore, Taiwan, Korea… are also close partners of
Vietnam. In Vietnam, FOB is also the method targeted by exporters. The price of the
product  includes all costs involved in the manufacturing process from importing,
checking raw materials, cutting fabric, sewing finished products, packing to transporting
to the port. This method makes it easier for enterprises to do business with limited
ability, from input material sourcing, manufacturing planning to products selling.

Regulations on Textiles exportation of Vietnamese government

Pursuant to the Appendix Issued together with Government’s Decree No. 69/2018/ND-
CP dated May 15, 2018, specifically the list of the prohibited exports (appendix I.1),
List of exported or imported by designated traders (appendix II), List of exported or
imported requiring licences or under given conditions (appendix III), List of goods posing
threat to national defence and security (appendix IV), List of goods and CFS
management authority (appendix V), textiles and garments are not on above lists.
Therefore, textiles and garments are not prohibited for export. In addition, with the
customs declaration for garments specified in Circular 38/2015/TT-BCT and Circular
39/2018/TT-BCT, textiles and garments are exported as normal items as long as being
provided with a full set of documents: Invoice, Packing List, Bill of Lading, Certificate of
Origin and Customs declaration. Note that this item is declared by product name as
follows: Name, Material Composition, Specification, Textile Technology (woven, knitted
or non-woven), Use, Yarn Density or Quantity.
·      Customs regulations:
All the general and specific customs procedures including measurement, quality
inspection, sampling, customs authority in-charge, customs documents, responsibilities
of Custom Sub-Department where traders follow customs procedures, responsibilities of
traders, etc. for textiles export are covered in Circular No. 07/2019/TT-BCT dated April
19, 2019 by The Ministry of Industry and Trade of The Socialist Republic of Vietnam.
·      Tariffs duties:
Article 4 Circulars No. 07/2019/TT-BCT provides that textile and garment exported to
Mexico are entitled to preferential tariffs under the CPTPP when having a Certificate of
Origin form CPTPP (Certificate of Origin form CPTPP) issued by a competent authority
according to the provisions of Circular No. 03/2019/TT-BCT dated January 22, 2019 of
the Ministry of Industry and Trade. 
The export tax rates that apply to exported items are listed in the Export Tariff for each
item. The tax tariff for 2017 can be found in Decree 122/2016/ ND-CP. The Ministry of
Finance will issue new Circulars whenever the tax tariff is updated, which will either
replace or supplement the existing ones. The value added tax (VAT) on exported items
is zero percent. 
·      Export duties:
Export duties declarations are required upon registration of customs declarations with
the customs offices. Export duties must be paid within 30 days of registration of
customs declarations. Only a few commodities are subject to export taxes. Taxes on
exports range from 0% to 45 percent. Value-added tax applies to a wide range of
products. Furthermore, the Special Consumption Tax (SCT) Law provides that
exporters who purchase SCT tax-liable goods for export but instead sell them locally are
subject to SCT. 
Article 1, Article 2, Article 3 Circulars No. 07/2009/TT-BCT provides all shipments of
textiles and garments exported to the United States must go through procedures for
issuance of Certificates origin. The registration and procedures for C/O issuance are
carried out at the C/O issuing teams of the Vietnam Chamber of Commerce and
Industry (VCCI). The issuance of C/O shall be done within 04 working hours from the
time the C/O Issuing Teams receive complete and valid dossiers. Procedures for
granting internal C/O are carried out in accordance with current regulations and
guidelines of VCCI.

SALE CONTRACT OF TEXTILE

SALE CONTRACT
No: 009/22- TSC
Date: June 16th, 2022
BETWEEN:  VITEX VINA COMPANY LIMITED 
Address: 32, Street 14E, Vinh Loc Residential Park, Binh Hung Hoa B Ward, Binh Tan
District, Ho Chi Minh City
Tel: 0917 384 395
Fax: 234-70-69410676
Email: julie@[Link]
Represented by: Ms. Nguyen Thi Kim Phuong
(Hereinafter called the Seller)
AND:  ARTHUR R JOHNSON CO INC
Address: 33, 34th Street, Brooklyn, New York, United States
Tel: (718) 832-2000 
Fax: 718-832-4965
Email: customerservice@[Link] 
Represented by: Mr. Ernest Iskowitz
(Hereinafter called the Buyer)
It is mutually agreed that the Buyer buys and the Seller sells the following commodity on
the terms and conditions as followed:
ARTICLE 1: COMMODITY
- Name: 100% cotton fabric
- Origin: Vietnam
ARTICLE 2: QUANTITY
- Total quantity to be shipped: 500 MT ± 2% at the buyer’s option
- The mentioned above quantity is understood as the gross weight of the net
- The tolerance price is determined at the time of delivery 
- The quantity is to be determined at the loading port
- Inspection cost shall be on the buyer’s account
ARTICLE 3: QUALITY
As technical specifications, which are indicated below:
- Composition: 100% cotton
- Fabric GSM (g/m2): 150 ± 5
- Width (inch): 59
- Structure: Plain weave
- Warp count: 34
- Weft count: 30 
- Ends per inch (EPI): 98
- Picks per inch (PPI): 72
- Absorbency: 33
- The quality certificate issued by Vinacontrol at the port of loading has final legal value.
ARTICLE 4: PRICE
- Currency: USD
- Unit price: USD 3000/MT FOB Hai Phong Port, Vietnam Incoterms 2020
- Total price: 1,500,000 ± 2%
- Total amount in letter: United States dollars 1 million and 5 hundred thousand more or
less two percent
ARTICLE 5: TERMS OF DELIVERY
- Time of shipment: within 30 days from the contracting date.
- Term of delivery: FOB Hai Phong Port, Vietnam – Incoterms 2020
- Port of loading: Hai Phong Port, Vietnam
- Port of unloading: Los Angeles Port, US
- Notice of shipment:
Within 24 hours after finishing the shipment, the Seller must inform the Buyer of the
details of shipment including date of shipment, GW, NW, ETA, and ETD, which is sent
via fax first and confirmed in written documents.
- Trans-shipment: Not allowed
- Partial shipment: Not allowed
ARTICLE 6: PAYMENT TERMS
- Payment shall be made by an irrevocable, at sight L/C in US dollars for 100% total
value of the Contract in favor of the Seller. L/C shall be issued through a reputable bank
in Los Angeles, the United States. L/C shall be issued at least 45 days before the
shipment and 60 days of invalidity. Payment shall be made against the presentation of
the required documents as the following:
● Signed commercial invoice in triplicate
● Bill of exchange
● Certificate of Quantity and Quality in triplicate
● Certificate of Origin in triplicate
● Certificate of Insurance 
● Detailed packing list 
● Full set (3/3) of original clean shipped on-board ocean bill of lading showing L/C
number, consigned to the order of Bank of America, Los Angeles branch and
notify the applicant with full address.
ARTICLE 7: FORCE MAJEURE
 The ICC Force majeure Clause 2003 is incorporated by reference into this contract.
 Article 79. CISG: A party is not liable for a failure to perform any of his obligations if he
proves that the failure was due to an impediment beyond his control and that he could
not reasonably be expected to have taken the impediment into account at the time of
 conclusion of the contract or to have avoided or overcome it or its consequences.
Should the effect of Force Majeure continue for more than 30 consecutive days, the
buyer has a right to cancel this Contract.
 ARTICLE 8: ARBITRATION
 All disputes arising out of or relating to this contract, including any question regarding
its existence, validity, or termination, shall be referred to, finally resolved, and
determined by arbitration under the International Rules of the American Arbitration
Association for the time being in force which rules are deemed to be incorporated by
reference of this clause. The arbitrator's award is final and binding on both parties.
Arbitration costs will be borne by the losing party.
 ARTICLE 9: OTHER TERMS
 Any amendment or supplement of the contract must be made in written form and
mutually agreed upon by both parties with authorized signatures.
This contract, which shall come to effect on the date of signing, is written in English in
06 Originals and 06 Copies, three of which are retained by each party.

 Ho Chi Minh City, 16th June 2022

 The Seller                   The Buyer

(signed, sealed) (signed,sealed)

Nguyen Thi Kim Phuong   Ernest Iskowitz

 
3. TEXTILE EXPORT PROCESS OF VIETNAMESE TRADER:
3.1. Diagram of Textile Export Process of Vietnamese Trader

Overall, the export process of Textile from Vietnam includes 4 main stages: Market
Research, Conclude a contract, Confirm Payment and Delivery. The main stages are
divided into 14 small steps which are going to be thoroughly described in the following
section.

3.2. Description of Textile Export Process of Vietnamese Trader

3.2.1. Step 1: Market Research
● Process participants: Exporter
● Related laws, rules and regulations: N/A

[Link]. Choosing Export Market

Market research is the process of collecting information and figures related to the
market, then analyzing and comparing them to draw conclusions about market trends.
The conclusion enables Vietnamese businesses to launch strategies to adapt to the
broad target market.
 ● Process activities: 
● Research on supply and demand and market volume to determine the
quantity of goods that can be sold
● Research on the political, economic - social conditions of the market to
develop long-term business strategies
● Research on the legal system and the relevant trade policy
● Research on the natural conditions such as weather, topography…
● Research on consumption habits of the potential market
● Monetary conditions, goods consumption channel…

[Link]. Choosing Export Goods

When the business wants to engage in textiles export activities, they must identify
exactly the type of goods they want to export.
● Process activities: 
● Determine and Predict the volatility trend of the market
● Determine the Opportunities and Threats the business might face

[Link]. Choosing Export Partners

Choosing the right business partner helps businesses avoid the nuisance, trouble, war
mortgage, the risk of loss when trading on the international market. 
● Process activities: 
Vietnamese business should take these characteristics of partners into
consideration:
● Organizational form
● Financial capacity
● Prestige of partners
● Goodwill of partners

[Link]. Choosing Trading Method

Trading methods are the overall process and trading style that is used to profit from the
international markets.
 ● Process activities: Choose the procedures, the trading conditions, the
manipulation and documents needed in business activities.

3.2.2. Step 2: Conclude A Contract

● Process participants: Exporter & Importer
● Related laws, rules and regulations: Incoterms 2020; Civil Code of the Socialist
Republic of Vietnam; Vietnam Customs Regulations; International rules of the
American Arbitration Association; ICC Force majeure Clause 2003

[Link]. Negotiation
Negotiation is one of the most important parts of active directory textiles that determines
the possibility and feasibility of the business plan of the company. Negotiations can be
done via letters, e-mail, fax or direct negotiations.
● Process activities of the exporter:
● Receive the inquiry from buyer
● Review the inquiry 
● Send an offer with quotations, trade, terms and conditions
● Begin negotiation

[Link]. Make A Contract

If negotiations take place smoothly and there is mutual agreement between two parties,
it will enforce a contract.
In an export contract, the exporter is obliged to transfer the ownership of goods to the
importer and the importer is obliged to make payment to the exporter by international
payment methods.

3.2.3. Step 3: Confirm Payment

● Process participants: Exporter, Importer, Issuing Bank & Advising Bank
● Related laws, rules and regulations: The Uniform Customs & Practice for
Documentary Credits (UCP 600); Vietnam Bank Regulations; Vietnam Laws on
Credit Institution, 2010; Conditions on the Contract of L/C
 ● Process activities:
● The Importer applies for Letter of Credit at the Issuing bank with required
documents
● The issuing bank reviews the Application and required documents
● The issuing bank issues L/C and sends to the Advising Bank
● The Advising Bank reviews the L/C and required documents
> If there is disagreement, the Advising Bank returns the proposed L/C to
the Issuing Bank
> If there is mutual agreement, the Advising Bank sends the L/C to the
exporter
● The Exporter receives the L/C and is notified that the L/C is ready for
payment
● The Exporter makes delivery to the Importer and prepares the required
documents
● The Exporter issues and presents the required documents to the Advising
Bank
● The Advising Bank reviews the submitted documents. If they are
compliant with the terms and conditions of L/C, the Advising Bank
transmits the required documents to the Issuing bank

3.2.4. Step 4: Delivery

● Process participants: Exporter
 ● Related laws, rules and regulations: Vietnam Law on Customs 54/2014/QH13;
The Uniform Customs & Practice for Documentary Credits (UCP 600); Conditions
on the L/C

[Link]. Export License Registration

Vietnamese Traders have to register a business and obtain a concerned trade license
so that they can begin exporting from/importing into Vietnam. The Ministry of Industry
and Trade (MOIT) controls the Commercial Law about international products, goods
sale and purchase in Vietnam.

[Link]. Prepare Goods for Export

● Process activities: For direct manufacturing and exporting business, the
preparing goods process includes selection, packaging, record labels in
accordance with the terms of the export contract.

[Link]. Insurance & Carriage (optional)

Depending on the Shipping term that is determined in a contract, Seller may have to
buy insurance or hire carriage according to the buyer’s requirement

[Link]. Export Customs Clearance

● Process activities: Vietnamese Trader have to prepare the following documents
to export:
● Electronic Export Customs Declaration 
● Bill of lading;
● Contract
● Certificate of origin;
● Commercial invoice;
● Customs export declaration form;
● Export Permit
● Packing list; and
● Technical standard/health certificate.
[Link]. Goods Inspect
Before export, the exporter is obliged to check the quality, quantity and weight of goods
in order to determine the exact condition of the goods before delivery.

[Link]. Delivery
● Process activities: 
● Exporters are responsible for delivering the goods in accordance with the
location identified in the contract on a means of transport. 
● Exporters receive carriage documents and exchange for bills of lading to
receive payments.

[Link]. Receive Payment

● Process activities: 
● The Importer makes payment at the Issuing Bank to claim the documents
● The Issuing Bank examines the documents and makes a decision to pay
or refuse to pay. If the submitted documents are compliant with the terms
and conditions of L/C, the Issuing Bank will transfer the payment to the
Advising Bank -> The Advising Bank will transfer the payment to the
Exporter
● The Issuing bank releases the documents collected from the Exporter to
the Importer.

5. Impacts of COVID 19 pandemic on the export performance of Vietnamese

businesses
5.1. A Slight Delay In Textiles Export in 2021
The spread of Covid-19 had massively affected the lives of people in the Southern area
of Vietnam. In the 3rd quarter of 2021, workers at textile enterprises left the southern
provinces and cities quite a lot to return to their hometowns and the possibility to return
was only 60-65%. It then disrupted the supply, broke the production chain of the
Vietnamese textile industry for the world. The Vietnamese traders faced the problem of
not guaranteeing the delivery time commitment for the buyers. The proportion of closed
factories had reached 30-35%. A large quantity of factories even had to close for a long
time, especially small and medium enterprises.
5.2. A Strong Growth and Adaptability of Vietnamese Textiles Trader in 2022
After exports slowed down in the third quarter of 2021 due to the impact of the 4th
Covid-19 epidemic, especially in the southern provinces, Vietnam's textile and garment
exports have positively recovered.

It can be seen that the textile industry is having many advantages in exporting textiles
and receiving a high number of orders: (i) Orders are transferred from countries facing
difficulties due to epidemic factors or internal political factors. (ii) Exporting textiles to the
US, EU, and fiber to China are favorable. (iii) The demand for textiles imports of the
world market, especially in major export markets of Vietnam has increased again, after
the period of isolation due to the Covid-19 epidemic. The reopening of countries has
increased demand for textile products. Notably, exports to the US and ASEAN markets
have become the driving force for export growth of this item.
Through the time of the epidemic, businesses quickly adapted and transformed the
structure of traditional goods into products that can adapt quickly, such as switching
from high-end suits, high-quality shirts... to clothes, labor protection, medical products,
knitwear, traditional shirts. Enterprises are also diversifying markets as well as adapting
to the payment mechanism platform in a new context, completely different from
traditional trading in the past. Businesses have been investing in equipment and
automation technology to contribute to the foundation for the textile industry to withstand
market pressure on quality and fast delivery.
 CONCLUSION
This research provides an overview of Vietnam's textile and garment industry and its
potential development. It also analyzes the process of exporting textiles and garments
to other countries and points out the bottlenecks of this process. Representative of
Vietnam Industry and Trade Center - Ministry of Industry and Trade (VITIC) said that the
textile industry has grown rapidly, but the development has not been balanced. Apparel
has experienced the fastest growth while the opposite was true for other fields such as
spinning, weaving, dyeing, and finishing. While the requirement of goods traceability
has been made mandatory by many major import markets, the biggest bottleneck of
Vietnam's textile and the garment is the supply of raw and auxiliary materials.
After exports slowed down in the third quarter of 2021 due to the impact of the 4th
Covid-19 epidemic, Vietnam's textile and garment exports have positively recovered.
Businesses quickly adapted by transforming the structure of traditional goods,
diversifying product lines, and markets as well as adapting to the payment mechanism
platform in a new context. 
 REFERENCES
Hải quan Việt Nam (2022), Tình hình xuất khẩu, nhập khẩu hàng hóa của Việt Nam
tháng 4 và 4 tháng/2022 [online]. Available at: [Link]
pageId=442&tkId=5122&group=Giới thiệu&category=Phân tích định kỳ [Accessed 16
Jun 2022]
Tổng cục Thống kê (2022), Số liệu xuất nhập khẩu các tháng năm 2022 [online].
Available at: [Link]
nhap-khau-cac-thang-nam-2022/[Accessed 16 Jun 2022]
General Statistic Office (2015), Statistical Yearbook of Vietnam 2015 [online]. Available
at: [Link]
vietnam-2015-2/ [Accessed 16 Jun 2022] 
Ministry of Industry and Trade of The Socialist Republic of Vietnam (2019), Quy định về
xuất khẩu hàng dệt may sang Mê-hi-cô theo Hiệp định Đối tác Toàn diện và Tiến bộ
xuyên Thái Bình Dương (CPTPP) [online]. Available at: [Link]
phap-luat/van-ban-phap-quy/-quy-dinh-ve-xuat-khau-hang-det-may-sang-me-hi-co-theo-
[Link] [Accessed 16 Jun 2022]
Ministry of Industry and Trade of The Socialist Republic of Vietnam (2009), Thông tư về
việc cấp Giấy chứng nhận xuất xứ hàng dệt may đối với một số chủng loại hàng xuất
khẩu sang Hoa Kỳ [online]. Available at: [Link]
phap-quy/[Link]
[Accessed 16 Jun 2022]
Ministry of Industry and Trade of The Socialist Republic of Vietnam (2014), Quyết định
phê duyệt Quy hoạch phát triển ngành công nghiệp Dệt May Việt Nam đến năm 2020,
tầm nhìn đến năm 2030 [online]. Available at:
[Link]
[Link] [Accessed 16 Jun 2022]
Dezan Shira & Associates (2019), Vietnam’s Import and Export Regulations Explained
[online] Vietnam Briefing. Available at:
[Link]
[Link]/ [Accessed 16 Jun 2022]
Tran Thi Bich Nhung, Tran Thi Phuong Thuy (2018), Vietnam’s textile and garment
industry: An Overview[online] Reasearch gate. Available at:
[Link]
%27s_textile_and_garment_industry_an_overview[Accessed 16 Jun 2022]
Ministry of Trade and Industry (2014),  Decision approving the  development plan  of
Vietnam textile and
garment to 2020, vision to 2030.
Le Hong Thuan (2017), Report on textile and garment industry, FPT Securities.
Bui Van Tot (2014), Report on textile and garment industry, FPT securities.
Nguyet A. Vu (2014), Report on textile and garment industry, VietinbankSc.
Website of General Statistics Office of Vietnam: [Link]
Website of General Department of Vietnam Customs: [Link]
Website vieglobal ([Link]
vietnam/)
[Link]
Vietnam Exports: Year to Date: Textiles and Garments | Economic Indicators | CEIC
(2022). Available at: [Link]
value/exports-ytd-textiles-and-garments (Accessed: 16 June 2022).
Một năm khởi sắc của sản xuất công nghiệp dệt may Việt Nam (2022). Available at:
[Link]
[Link] (Accessed: 16 June 2022).
A Quick Guide to Understanding Letters of Credit (2022). Available at:
[Link] (Accessed: 16 June
2022).