HÀ NỘI — The number of local firms that are part of the supply chain for Samsung’s plants in Việt Nam has increased dramatically to a total of 215 vendors.

This includes 25 tier-1 vendors and 190 tier-2 vendors, all of whom supply to Samsung’s various factories such as Samsung Electronics Việt Nam (SEV), Samsung Electronics Việt Nam Thái Nguyên (SEVT), Samsung Electronics HCM City Complex (SEHC), Samsung Display Việt Nam, Samsung SDI Việt Nam and Samsung Electro-Mechanics Việt Nam.

It is expected that Samsung’s tier-1 vendors will increase to 29 in 2017.

Samsung Việt Nam has also recorded breakthrough figures in raising the localisation rate of its products, from 35 per cent in 2014 to 57 per cent now.

The information was released on Tuesday during a survey visit made by Samsung Việt Nam’s board of directors at three enterprises - Thanh Long Electronic Production JSC, Hanel Plastics JSC, and Việt Nam HTMP Mechanical Co Ltd - that are participating in their consultation programme by experts from Samsung South Korea. The assessment is part of a 12-week programme designed to strengthen the capacity of Vietnamese businesses that are part of Samsung’s components and accessories supply chain.

During the first two weeks, the experts survey and assess these enterprises and then for the next 10 weeks, they interview and work directly with these businesses to improve their production processes and ensure they fulfil Samsung’s products and components standards.

The programme feedback has been positive, helping businesses improve production and capacity as well as become more well-rounded.

Take the case of Thanh Long Electronic Production JSC, which is SEHC’s tier-2 vendor and the only local enterprise in the Samsung ecosystem in Việt Nam to supply electronic PCB boards. After three months of the consultation programme, its Final Quality Control rate has dropped 68.5 per cent, equipment operating rate has increased 23.8 per cent and inventory cost has fallen by 28.6 per cent.

The consultation programme is Samsung’s response to the Vietnamese Government’s call to increase localisation rate and the involvement of local businesses in Samsung’s component supply chain.

In 2017, Samsung is expected to offer consultation to 12 local supply enterprises, increasing the total number of businesses that have undergone the programme to 26 since 2015. The priority is on supporting businesses in the technical sector, and expanding the scope of consultation to domestic partner companies.

“Samsung’s consultation model is not only for its supply vendors, but also aimed for the development of potential support industry enterprises in Việt Nam in general. We hope to help Việt Nam’s support industry develop further,” Hwan said. “To make it effective, we expect to work more closely with associations and relevant departments of the Vietnamese government.”

After completing the consultation programme for the three businesses in the north, Samsung Việt Nam will take the programme to HCM City on Thursday for three enterprises: Việt Nhật PTE (wire harness), Viettronics Bình Hòa JSC (transformer), and Tiến Thịnh Co Ltd (copper-made wire). — VNS