Vietnam’s manufacturing industry is currently undergoing an unprecedented period of transformation. While showing strong recovery, such as an 8.4% rise in the Industrial Production Index (IIP) for 2024 compared to the previous year, the procurement dilemma at the factory floor is worsening: “We cannot get the necessary parts, at the necessary time, with the necessary quality.” Specifically, the local procurement of high-quality screws and fastening components, which are indispensable for automated lines and precision equipment, is a headache for many Japanese companies.

This article analyzes the supply chain challenges faced by the Vietnamese manufacturing industry based on quantitative data and explains the unique integrated procurement solution—”Manufacturing, Wholesale, and MRO” offered by Ohta Vietnam. Let’s explore the “best practices for procurement” together to achieve both cost reduction and stable quality.

Vietnam continues to attract investment from around the world as a prime candidate for “China Plus One.” The realized Foreign Direct Investment (FDI) for 2024 reached a record high of 25.35 billion USD, with approximately 78% concentrated in the processing and manufacturing sector. However, despite the rapid growth of the industry, the supporting industries remain under development.

According to a JETRO survey, approximately 39.3% of Japanese companies in Vietnam plan to expand local procurement within the next 1-2 years, but the local procurement rate still has room for improvement. Particularly for “fastening components (bolts, nuts, screws)” that require high precision, the variation in quality among local suppliers and the insufficient ability to handle custom-made products become bottlenecks, leading to many cases where companies are forced to rely on imports from Japan.

In recent years, accompanying the shortening of product cycles, the need for “High-Mix Low-Volume” procurement, not only for mass-produced parts but also for prototypes and maintenance parts, has surged. However, typical Vietnamese suppliers tend to favor mass production (mass production), often responding to small-lot orders with “refusal to quote” or “high minimum order quantities (MOQ).” This is a significant factor contributing to the exhaustion of factory procurement managers.

In response to this dual challenge of “quality” and “small lots,” Ohta Vietnam presents a unique solution that fuses trading company functions and manufacturer functions.

Ohta Vietnam’s greatest feature is that it is not merely a wholesaler. The company owns precision machining equipment in its own factory, allowing it to manufacture precision cut components made of metal and resin in-house.

This “hybrid model” allows customers to achieve the differentiated approach—”standard products are cheap through wholesale, custom products are fast through in-house manufacturing”—all through a single window (one-stop).

To maintain production lines, not only production parts (Direct Material) but also auxiliary materials such as tools and safety gear (Indirect Material / MRO) are essential. Ohta Vietnam is an authorized distributor for TRUSCO Nakayama (TRUSCO), a brand familiar in Japanese factories.

Since it can supply a vast range of items listed in their “Orange Book” catalog locally in Vietnam, customers can place bulk orders for tools, gloves, and logistics supplies alongside their screw purchases. This drastically reduces the labor hours spent on ordering operations, creating an environment where procurement managers can concentrate on core tasks.

The biggest risk in Vietnamese procurement is “quality defects.” Ohta Vietnam inherits the strict quality management standards (Quality Management System) of its parent company, which has obtained ISO9001/ISO14001 certification.

The company maintains in-house inspection equipment and performs stringent incoming and outgoing inspections not only on its own products but also on parts procured from partner factories. This means Ohta Vietnam acts as a “quality gatekeeper,” allowing customers to gain peace of mind with Japanese quality, even when sourcing parts locally.

A certain Japanese manufacturer required a screw with a special shape during the prototyping phase of a new product. After consulting several local companies, they were turned down with demands like “we only accept orders from 10,000 pieces,” nearly halting development.

Upon consulting with Ohta Vietnam, the company utilized its own processing machine to quickly manufacture the required 50 pieces. Furthermore, after transitioning to the mass production phase, they provided a cost-down proposal utilizing partnered factories, offering seamless support from development to mass production. In this way, the company’s strength lies in functioning as a development partner, not just a mere “seller of goods.”

As Vietnam’s manufacturing industry advances, the requirements for parts procurement are shifting from “low price” to “reliability and flexibility.” With the market growing at over 6% annually, strengthening the supply chain is a management imperative.

By combining “Precision Machining Function,” “Extensive Procurement Network,” and “TRUSCO Distributor Function,” Ohta Vietnam provides solutions that overcome the local procurement bottlenecks of “High-Mix Low-Volume” and “Quality Assurance.”

For those aiming to build stable production lines and optimize procurement operations, Ohta Vietnam will serve as a strong partner—a “procurement professional”—to support business growth in Vietnam.

Conclusion

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At Ohta Vietnam, we not only provide ready-made products such as screws and bolts, but also support activities in the manufacturing field such as cutting, inspection, assembly, packaging…
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