Samsung Looking For Vietnamese Supply Chain Partners
Samsung Working To Develop Its Vietnamese Supply Chain Networks
According to Shim Won Hwan, Samsung Vietnam’s CEO, Samsung is scouting for local companies to join its consulting programmes in order to enhance the company’s supply chain networks. This is a programme that the company had previously collaborated with the Ministry of Industry and Trade (MoIT), government agencies as well as local associations in order to source for qualified local companies that would be able to join.
In comparison with the localisation rate of 25 percent in 2014, Samsung’s current rate has increased to 58 percent this year and the number of local companies that rank as Samsung Vietnam’s tier-1 vendors have increased from 4 in 2014 to 35 in 2018 and this number is expected to reach 50 by 2020.
In fact, over the past ten years, Samsung has invested a upwards of US$17 billion in Vietnam and employed 160,000 locals. In 2017, Vietnam’s export turnover reached US$214 billion, of which Samsung alone contributed over US$54 billion to that figure. Additionally, the company’s four subsidiaries in Vietnam have a combined revenue of US$20.5 billion and a profit of US$2.08 billion in the first quarter this year alone and the same figures have experienced a 50 percent year-on-year increase, according to the company’s quarterly financial statements.
50 percent of Samsung’s smartphones and tablets are now manufactured in Vietnam and exported to 128 countries and territories, including the US, Europe, Russia and Southeast Asia. And since April 2018, Samsung has worked with the MoIT to provide training courses to 200 Vietnamese consultants so that they would be better able to advise local companies on how productivity can be improved and this will in turn help to develop Vietnam’s support industry.
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