Using supply chain integration theory for establishing industrial cluster to facilitate the growth of small and medium enterprises: Evidence in Vietnam

Huynh Thu Suong1 , Huynh Thanh Dien2

1 University of Finance and Marketing, Vietnam (Corresponding author)

2 Nguyen Tat Thanh University, Vietnam E-mails:

1 huynhthusuong@ufm.edu.vn ;

2thanhdien82@gmail.com

Received 13 February 2020; accepted 15 November 2020; published 30 December 2020

Abstract.

In an economy, the product of one industry is the input to another, the product of one enterprise is the input of another business and the end consumer. Countries that know how to create industry linkages to attract businesses to participate will promote business growth in both quantity and quality. In Vietnam, an efficient chain of industry links has not been formed, so it has not created favorable conditions for businesses to develop. Most of the FDI enterprises come to Vietnam to participate partly in the global value chain, but the ability of domestic enterprises to participate is still very limited. The domestic industry linkage chain has not been clearly shaped, the domestic enterprises operate sporadically, so it has not created an attractive ecosystem for small and medium enterprises to participate. To create industry linkages for domestic enterprises to participate, it is necessary to build models of production organization in industries from market research, product design, and organization of satellite businesses to the production of details and components in order to establish a distribution system to the market. Mechanisms and policies focus on supporting and providing incentives for enterprises joining industry clusters operating in all phases of investment in research, design, supply of ancillary products, and distribution. Keywords: Industrial clusters; supply chains integration; business ecosystems

Reference to this paper should be made as follows: Suong, H.T., Dien, H.T. 2020. Using supply chain integration theory for establishing industrial cluster to facilitate the growth of small and medium enterprises: Evidence in Vietnam. Journal of Security and Sustainability Issues, 10(2), 763-777. http://doi.org/10.9770/jssi.2020.10.2(31) JEL Classifications: F15, L69, Q01

LINK: http://www.tb.lt/Leidiniai/SSI/10-2/10_2_31.pdf