Samsung hunts for local suppliers despite Vietnam's weak support industry

By Nguyen Hoai   June 22, 2016 | 12:00 am PT
Having constructed two manufacturing plants in Vietnam, Samsung is still looking for local enterprises that can provide the company with quality spare parts, said Han Myoungsup, general director of the Samsung manufacturing complex.

In 2015, the number of local suppliers working with Samsung tripled on-year to 190, of which three provided electronic components while the rest specialized in packaging for smartphones and tablets.

Nguyen Cam Tu, deputy minister of Industry and Trade, said that these figures were “fairly humble”.

“The majority of Vietnamese enterprises that have joined the Samsung manufacturing chain are at the low-value end; just a few are able to provide high-tech components.”

Han Myoungsup said: “We realize that Vietnamese companies have great potential and capabilities. The only matter is finding suitable development methods.”

The director added that Samsung is willing to cooperate with local suppliers provided they meet requirements in terms of technology, quality, financial status and price. In addition, companies will go through a three-month period of supervision and improvement before becoming one of Samsung‘s partners.

Director of Goldsun Joint Stock Company Pham Quang Vinh, who beat 300 rivals to become the packaging supplier for Samsung, said: “In just three months, we increased our rate of flawless products to 94 percent, while the error rate was slashed by 72 percent. Moreover, prompt delivery and reasonable prices have made us the official supplier for Samsung Vietnam.”

Using Goldsun as an example, Han Myoungsup suggested that Vietnam should invest in technical engineers to improve product quality. The director added that Samsung will offer Vietnam training programs to help local companies increase their competitiveness in the support industry.

At present, Vietnam's support industries remain weak, with 90 percent of raw materials, spare parts and components imported form external sources, according to Pham Tuan Anh, deputy head of the Heavy Industries Department under the Ministry of Industry and Trade.

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