Corona Virus Has Been Causing Extremely Serious Effects on Supply Chains in Vietnam

Sunday - 26/07/2020 22:25
Corona Virus Has Been Causing Extremely Serious Effects on Supply Chains in Vietnam
Corona Virus Has Been Causing Extremely Serious Effects on Supply Chains in Vietnam

According to Dr. Hau Lee and co-author Corey Billington, supply chain management is the integration of activities that occur at the base of the network to create raw materials, move them into intermediate products and then comes the final finished product and distributes the product to the customer through the distribution system.



The global supply chain is the process of transforming raw materials into final products, often occurring in some different countries, transporting products and services from manufacturers to consumers. Through increased globalization and international finance, this process is expanding day by day throughout the world.

Covid-19 has greatly affected global supply chains: (i) Flow of goods - commercial activities are interrupted; (ii) Supply chain disruptions - The supply time is prolonged because of epidemic control; (iii)The movement of global supply chain; (iv) Air and road transport is also interrupted

For Vietnam - Impact on manufacturing industries along the supply chain:
The Covid-19 epidemic has affected supply chain manufacturing industries in Vietnam in three major industries
Firstly, many FDI enterprises in Vietnam in the above industries are also affected. Some big businesses like Samsung, Formosa, Apple, Toyota, Honda, etc. facing significant difficulties: (i) lack of labor force due to quarantine or travel restrictions for workers and experts from South Korea, China (ii) lack of input supply imported from China, Korea, .... and other countries.


More than 260 containers that transporting dragon fruit are congested because of Coronavirus.

Second, Vietnam is in the integration period. Many manufacturing industries follow the supply chain model such as cars - motorcycles - phones (Vinfast), textiles, footwear, manufacturing, iron - steel, filtering. Petrochemicals, retail ... especially agro-processing industries are affected by this disease, due to bottlenecked export output and lack of input supply.
Thirdly, many domestic logistics and transport enterprises are seriously affected. The amount of import and export goods decreased. Besides, sea transport by air transport by road transport has decreased. The cost of gasoline and transportation costs will push up, which will make it more difficult for the economy, causing delays in goods and affecting the supply chain.
Overall, these effects are quite significant, negatively affecting Vietnam's exports, employment, and consumption.

Opportunity for online shopping
The pandemic has been disastrous for some while having created opportunities for others. In particular, online grocery shopping has jumped while food delivery services are popular as well. BigC supermarket chain said that their stores in southern Vietnam reported 3000 online orders in March, up 1,000 from the previous month.
The pandemic has changed consumer trends; a survey by Nielsen Vietnam revealed that people reduced their frequency of visits to supermarkets by 50 percent. As Vietnam’s e-commerce is still growing the pandemic has accelerated this shift.


Editor: Nguyen Van Dung

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