Early in November NEM Vietnam, which is the second largest maker of women’s apparel in the country, made announcement on its website that their brand and Stripe International, a Japanese fashion retailer, had started business negotiations for the latter that implied that Stripe International would acquire a stake in NEM.
According to Hanoi times, Stripe wants to take over the fashion business of NEM in Vietnam as they own the NEM women’s fashion brand, which possess huge potential as it has 44 stores across the country and its target customers are women aged 20-40. By this takeover NEM’s revenue is expected to rise by 20 per cent this year to US$26 million.
The newspaper also quoted Yasuhary Ishikawa, the president of Stripe, he said that acquisition of NEM is part of their business plan to enter the Vietnamese fashion market.
Although there has been no official statement made by NEM on the acquisition deal, the industry analysts have expressed their concern over Vietnamese fashion industry that face the threat to be taken over by big foreign businesses in the near future.
Industry insiders said the concern is not baseless as the Vietnamese consumers, particularly young generation, loves foreign fashion brands.
For instance, when famous Swedish brand H&M opened its first company outlet last on September 9, a two-storey 2,200-square-metre flagship at Vincom Đồng Khởi in Hồ Chí Minh, more than 4,000 people queued up outside the store and a record of total of 10,000 people visited it on the opening day itself.
Several other international fashion brands such as Mango and Topshop have also ventured into Vietnam’s fashion market. Topshop has opened four stores.
According to a data released by Vietnam Textile and Garment Group, the apparel industry is growing at 20 per cent annually. Total value of the market is now $4.5 billion a year. And the entry of famous international fashion brands has intensified the price battle, design and international features competition.