The global manufacturing landscape is shifting. Increasingly, companies are seeking alternatives to relying solely on China for production. This trend is driven by rising costs, trade tensions, and the need for more resilient supply chains. As a result, companies moving from China to Vietnam are capturing headlines, signaling a significant change in global sourcing strategies.
Vietnam’s combination of competitive costs, export-friendly policies, and skilled labor makes it a top alternative for businesses looking to diversify production. Understanding why this shift is happening, and what it means for buyers, is essential for anyone navigating international manufacturing today.
Key Takeaways:
- Trend is accelerating: More global brands are relocating from China to Vietnam due to rising costs and supply chain risks.
- Vietnam offers competitive advantages: Lower labor costs, favorable trade agreements, and a skilled, growing workforce make it an attractive alternative.
- Industries most affected: Electronics, apparel, footwear, furniture, and consumer goods are leading the shift.
- Impact on buyers: Diversified sourcing reduces risk, lowers tariffs, and provides more pricing stability.
- Planning is crucial: Buyers must evaluate raw materials, factory capacity, and compliance standards to ensure a smooth transition.
Table of Contents:
- Why Companies Are Leaving China
- Why Vietnam Is the Top Replacement
- Industries Seeing the Biggest Shift
- Case Studies: Major Companies Moving From China To Vietnam
- How This Shift Impacts Global Buyers
- What Buyers Should Consider Before Switching
- The Growing Shift of Companies Moving From China to Vietnam
- FAQ: Companies Moving From China to Vietnam
Why Companies Are Leaving China
Global manufacturers are increasingly reassessing their dependence on China as a single production base. Several key factors are accelerating this shift:
1. Rising operating costs
Labor wages, land prices, and overhead expenses in China have climbed steadily, especially in major coastal manufacturing zones, making it harder for brands to maintain competitive margins. As a result, companies are actively seeking more cost-efficient destinations.
2. Tariff pressure
Ongoing trade tensions and punitive tariffs from major markets like the U.S. and EU have raised the total landed cost of China-made products. For many businesses, reallocating production is now a strategic way to avoid these financial penalties.
3. Supply chain risk diversification
Relying too heavily on one country exposes companies to significant risks, from pandemics and natural disasters to regulatory changes. Diversifying production locations has become essential for supply chain resilience.
4. Political and regulatory tension
Geopolitical uncertainties, stricter compliance requirements, and increased global scrutiny have pushed brands to reduce dependency on China and expand operations elsewhere.
Taken together, these pressures have made Vietnam one of the most attractive and practical alternatives for manufacturing relocation.
Read more: Vietnam Sourcing vs China: Cost, Quality, and Lead Time Comparison
Why Vietnam Is the Top Replacement
For many global brands evaluating new production hubs, Vietnam has emerged as the leading alternative. The shift is driven by a combination of cost advantages, trade benefits, and a rapidly developing industrial ecosystem, key reasons why companies moving from China to Vietnam are accelerating each year.
1. Competitive production costs
Vietnam offers significantly lower labor and operational expenses compared with China, particularly for labor-intensive products like apparel, footwear, and consumer goods. These savings allow companies to maintain competitive pricing without sacrificing product quality.
2. Extensive free trade agreements
Vietnam’s strong network of FTAs, including CPTPP, EVFTA, RCEP, and ASEAN trade agreements, provides tariff reductions and market access that China cannot currently match. This gives manufacturers a clear advantage when exporting to major economies.
3. Lower tariffs to key markets
Products shipped from Vietnam to the U.S., EU, Australia, and Canada often face far lower duties compared with goods originating from China. This has become one of the most important incentives for companies relocating production lines.
4. Fast-growing manufacturing talent
Vietnam’s young, skilled workforce continues to grow quickly, supporting high-demand sectors such as electronics, furniture, textiles, and consumer goods. Multinational supply chains benefit from a labor pool that is both capable and increasingly experienced with global production standards.
These advantages collectively explain why more companies are moving from China to Vietnam as part of their long-term sourcing and diversification strategies.
Industries Seeing the Biggest Shift
As more companies move from China to Vietnam, several industries stand out for experiencing the fastest and most significant relocation of production. These sectors benefit the most from Vietnam’s competitive labor costs, trade advantages, and expanding manufacturing capabilities.
1. Electronics
Vietnam has become a major hub for electronics assembly and component manufacturing, driven by investments from Samsung, Apple suppliers, and other global tech brands. The country offers growing technical expertise and competitive operating costs, making it a top destination for shifting electronics production.
2. Apparel
Cutting, sewing, and garment production are among the first activities companies move from China to Vietnam. The country’s experienced textile workforce and cost efficiency make it ideal for fashion and apparel brands looking to reduce expenses without sacrificing quality.
Read more: Clothing Brands Made in Vietnam: A Sourcing Guide for Apparel Businesses
3. Footwear
Vietnam is now one of the world’s largest footwear exporters, attracting brands that want reliable craftsmanship at lower production costs. Major global names have already shifted significant production volumes from China to Vietnam, reinforcing the country’s position as a premier footwear manufacturing hub.
Read more: Are Jordans Made in China or Vietnam?
4. Furniture
Furniture brands relocating from China to Vietnam benefit from the country’s strong woodworking tradition, abundant raw materials, and skilled labor. Vietnam has become a global leader in wood furniture exports, particularly to the U.S. and Europe.
5. Consumer Goods
Homeware, personal goods, household products, and lifestyle items are increasingly produced in Vietnam to reduce tariff exposure and diversify sourcing. Manufacturers find Vietnam’s supply chain reliable, scalable, and well suited for mass-market consumer products.
These industries illustrate why more companies are moving from China to Vietnam each year, with the trend expected to accelerate as global brands continue seeking lower costs, tariff advantages, and supply chain resilience.
Case Studies: Major Companies Moving From China To Vietnam
Several well-known brands illustrate the growing trend of companies moving from China to Vietnam, showcasing how global manufacturers are diversifying operations and strengthening supply chain resilience.
1. Apple Suppliers
Multiple Apple suppliers, including manufacturers of components, accessories, and final assembly units, have shifted significant portions of production to Vietnam. This move helps Apple reduce risk, cut tariff exposure, and diversify beyond China’s concentrated electronics supply chain.
Read more: AirPods Made in China vs Vietnam: Key Differences You Should Know
2. Samsung
Samsung is one of the most prominent examples of large-scale relocation. The company has expanded its manufacturing footprint in Vietnam to the point where the country now serves as one of its largest global production bases. This shift allows Samsung to stabilize operating costs and benefit from Vietnam’s growing pool of technical talent.
3. Nike and Adidas
Footwear giants Nike and Adidas have steadily increased production volumes in Vietnam over the past decade. As labor and compliance costs in China rose, both brands accelerated their transition to Vietnam, leveraging its skilled workforce, competitive wages, and strong export capabilities.
Read more:
- Where Was Nike Made? Inside Nike’s Global Manufacturing Network
- Are Crocs Made in Vietnam or China? Quality, Production & Supply Chain
4. Global Furniture Brands
Major furniture manufacturers, from home décor brands to high-volume wood furniture exporters, have moved factories from China to Vietnam to take advantage of the country’s craftsmanship, abundant raw materials, and lower production costs. Vietnam’s strong position in the U.S. market has also contributed to this relocation trend.
These case studies demonstrate how top global brands are reshaping their supply chains by moving production from China to Vietnam, driven by cost advantages, tariff benefits, and long-term stability.
How This Shift Impacts Global Buyers
The rise of companies moving from China to Vietnam is reshaping global sourcing, and buyers are seeing clear advantages.
1. More diverse supply options
As manufacturing spreads across both markets, buyers gain access to a wider range of suppliers, reducing reliance on any single country.
2. Better pricing stability
Vietnam’s lower labor and production costs often lead to more predictable pricing, especially for apparel, footwear, furniture, and consumer goods.
3. Lower tariff exposure
Free trade agreements with the U.S., EU, Australia, and Canada help buyers minimize import duties and avoid the tariff pressures associated with China.
4. Improved supply chain resilience
By sourcing from Vietnam, buyers are less vulnerable to disruptions related to geopolitical tensions, regional lockdowns, or overconcentration in one market.
What Buyers Should Consider Before Switching
Even with the momentum of companies moving from China to Vietnam, transitioning production requires careful evaluation.
1. Availability of raw materials:
Some Vietnamese industries still depend on imported components, which can affect lead times and total production costs.
2. Factory capacity:
Vietnam’s factories are efficient but often smaller than China’s large-scale facilities, which may impact high-volume orders.
3. Compliance and certifications:
Buyers must ensure Vietnamese suppliers meet required quality, safety, and ESG standards before onboarding.
4. Planning and supplier vetting:
A structured transition, site visits, audits, sampling, and trial orders, helps ensure a smooth shift from China to Vietnam.
The Growing Shift of Companies Moving From China to Vietnam
The shift of companies moving from China to Vietnam continues to accelerate. Vietnam offers a powerful combination of competitive labor costs, strong export advantages, and a fast-growing skilled workforce, making it an attractive alternative for global brands seeking to diversify production and reduce operational risk.
As global trade dynamics evolve, Vietnam is quickly positioning itself as a major manufacturing hub. Businesses sourcing from Vietnam gain benefits such as:
- Lower import tariffs and better trade access
- More flexible and resilient supply chains
- Improved cost efficiency and diversified production options
For brands exploring Vietnam as a sourcing destination, platforms like VALO Vietnam make the transition smoother by connecting buyers directly with verified, reliable suppliers, ensuring transparency, trust, and long-term success.
- Call us 24/7: +84 79 928 7929
- Email: alo@valovietnam.com
FAQ: Companies Moving From China to Vietnam
1. Why are so many companies moving from China to Vietnam?
Rising labor costs in China, tariff pressures, geopolitical tensions, and the need to diversify supply chains are the main drivers. Vietnam offers competitive production costs, strong export agreements, and a skilled workforce.
2. Which industries are shifting production to Vietnam the most?
Electronics, apparel, footwear, furniture, and general consumer goods are leading the move, as companies seek lower costs and reliable manufacturing.
3. Are products made in Vietnam as high-quality as those made in China?
Yes, especially in labor-intensive sectors like apparel, footwear, and furniture. Vietnam is improving its quality control standards and craftsmanship, making it a reliable alternative.
4. How do trade agreements affect companies relocating to Vietnam?
Vietnam benefits from FTAs like CPTPP, EVFTA, and RCEP, allowing reduced or zero tariffs for exports to the U.S., EU, Australia, and Canada, which is a major incentive for relocation.
5. What should buyers consider before moving production to Vietnam?
Key considerations include raw material availability, factory capacity, production timelines, and compliance with quality and ESG standards.