EU Green Regulations Are Changing How Textile Businesses Prepare Orders

The textile industry is entering a period in which production capacity, cost and delivery time are no longer the only criteria determining competitiveness. For businesses exporting to Europe, information about materials, production processes, product durability and post-use treatment options is increasingly shaping relationships with customers.

This change is being driven by the European Union’s policy framework on sustainable products and the circular economy. Among these measures, the EU’s Ecodesign for Sustainable Products Regulation, adopted in 2024, establishes a legal framework for European authorities to develop specific requirements for different product groups. The EU Strategy for Sustainable and Circular Textiles also places the fashion industry at the center of this transition.

For Vietnamese businesses, this is not merely a matter of complying with a new technical standard. This direction may affect how companies select yarns, organize data, control suppliers, design products and negotiate with international brands. Businesses that prepare early will have an advantage in retaining customers and participating in orders with stringent transparency requirements.

From Product Inspection to Controlling the Entire Life Cycle

In the traditional export model, buyers often focus on easily measurable criteria such as fiber composition, colorfastness, shrinkage, chemical safety, sewing quality and delivery schedules. These remain mandatory requirements, but they do not fully reflect the new direction of European policy.

The legal framework for sustainable products expands the scope of assessment from the design stage through the post-use phase. A product may be considered from the stages of design, material selection, production, transportation and use through to repair, reuse or recycling. For textiles, this raises broader questions: Does the product use suitable materials? Is it durable enough to extend its useful life? Can users repair or sort the product? And does the business provide sufficient information for the subsequent stages?

EU regulations do not automatically turn every requirement into an identical obligation for all businesses at the same time. Many specific requirements will need to be implemented through regulations for individual product groups. However, the policy direction is relatively clear: indicators related to durability, reparability, the use of recycled materials, resource efficiency and the ability to provide data will become increasingly important.

A notable point is that responsibility does not rest solely with the final manufacturer. A brand may request data from fabric suppliers, dyeing plants, finishing companies, printing or embroidery facilities and businesses supplying input materials. Therefore, textile companies that do not directly sell products under their own brands may still need to meet requirements for traceability and production evidence.

Data Becomes Part of the Product

Under the EU’s approach, the Digital Product Passport is an important tool for storing and sharing product-related information. For textiles, the data may concern material composition, origin, product characteristics, care instructions, repairability, reuse or end-of-life treatment. The specific content will depend on the requirements issued for each product group and on how responsibilities are allocated among businesses in the supply chain.

This changes the role of data departments within businesses. Previously, information about materials and production might have been scattered across emails, spreadsheets, quality inspection forms or the records of individual departments. When customers request consistent data for multiple product codes, this method can easily create discrepancies and require considerable time for cross-checking.

Businesses therefore need to view the ability to collect, verify and store data as a competitive capability. A system does not need to be overly complex at first, but it must identify who is responsible, where the data comes from, when it is updated, which documents are used as evidence and how changes to materials or suppliers are handled.

The First Pressure Will Emerge in the Raw Material Supply Chain

In textiles, many environmental and social indicators are determined before fabric enters the sewing line. Fiber type, blend ratios, sources of recycled materials, fiber-processing methods, dyes, finishing chemicals and water consumption can all affect a product’s sustainability profile.

This is why brands tend to request more documentation from suppliers instead of relying only on written declarations. Documents may include certifications, test results, records of material transactions, factory information and evidence that relevant processes are being controlled. The value of a claim about recycled materials, for example, depends on the ability to prove the proportion and origin of those materials.

For Vietnamese businesses, the challenge lies in the fragmented nature of the supply chain. A garment order may use fabric from one factory, yarn from another supplier, chemicals from a third party and materials purchased through several intermediary levels. If data is not standardized from the outset, a garment factory will find it difficult to meet a customer’s traceability requirements even if it has itself fulfilled the applicable technical standards.

Businesses also need to distinguish between a certification for a product, a certification for a factory and a certification for a batch of materials. These three types of information cannot always replace one another. Using a general certification to explain multiple different products may create risks if its scope of application is not appropriate.

Recycled Materials Should Not Be Viewed as the Only Answer

Recycled materials are frequently mentioned in the fashion industry’s sustainability plans. However, switching from virgin fibers to recycled fibers does not automatically solve every problem. Businesses still need to consider quality, durability, traceability, suitability for the design and options for treating the product after use.

In particular, products made from multiple fiber types or containing numerous auxiliary components may be more difficult to sort and recycle. Sewing thread, zippers, labels, coatings, prints and details combining different materials can all affect end-of-life treatment. If design focuses only on the proportion of recycled materials while overlooking durability or disassembly, the product’s circularity performance may not meet expectations.

A more cautious approach is therefore to assess multiple factors at the same time: How long can the product be used? Can it be repaired? How clearly is the proportion of materials identified? Can the components be separated? And do users have sufficient information to care for the product properly?

Impact on Production Operations and Export Orders

EU green regulations may affect textile businesses on three levels. The first is documentation requirements. Businesses must standardize data on materials, chemicals, energy, water, waste and suppliers when customers request it. The second is technical requirements, which may relate to design, durability, material composition or reparability. The third is commercial requirements, as customers use sustainability criteria to select, evaluate or classify suppliers.

In the short term, meeting the new requirements may increase management costs. Factories must train employees, digitize records, review procurement systems and allocate additional resources for testing. Some orders may also require design adjustments or material changes, which can affect consumption standards, sample development time and production plans.

However, these costs are not merely additional expenses. A good data system can help businesses reduce the time spent locating records, minimize errors when working with multiple customers and identify supplier problems at an early stage. Tighter material controls also support quality management and reduce the risk of having to reprocess goods.

Commercially, businesses that only perform contract manufacturing based on customer designs may face greater pressure because profit margins often depend on the buyer’s decisions. When data and green production requirements become part of supplier evaluations, a labor-cost advantage will no longer be enough to secure orders. The ability to respond quickly, provide clear evidence and coordinate with customers from the design stage will become more significant.

Small and Medium-Sized Businesses Need to Prioritize According to Risk

Not every business can immediately invest in a comprehensive data platform. For small and medium-sized businesses, a more practical approach is to map the supply chain for the most important products and markets. High-risk material groups, customers with strict requirements or large export orders should be prioritized first.

The next step is to build a minimum data set. This may include a supplier list, material composition, inspection records, relevant certifications, information about dyeing and finishing processes, and an approval procedure for material changes. The important point is not to collect as many documents as possible, but to ensure that the documents can be verified and linked correctly to the product or batch.

Businesses should also standardize the terminology and calculation methods used internally. If the purchasing, technical, production and sales departments use different versions of the information, the risk of discrepancies will increase when working with international customers. A simple change-control process can help prevent yarn, supplier or dye-formula changes from being made without updating the records.

Green Investment Needs to Be Linked to Business Efficiency

The green transition in textiles is often discussed in terms of renewable energy projects, wastewater treatment, water conservation or the use of recycled materials. These are important investment directions, but businesses need to evaluate them in relation to specific customer requirements and the factory’s operational capabilities.

A project may help reduce water consumption but may not solve the problem of material traceability. Conversely, a data system may not immediately produce a significant reduction in emissions, but it may help a business qualify for a new purchasing program. Transition plans should therefore combine improvements in actual operations with enhanced capacity to demonstrate results.

The Vietnam Textile and Apparel Association and businesses in the industry can also play a connecting role in this process, particularly by disseminating requirements, sharing measurement methods and helping smaller businesses access suitable solutions. If each business handles the matter separately, costs may increase and different interpretations may emerge within the same supply chain.

At the business level, leaders need to incorporate data and sustainability objectives into decision-making processes rather than assigning them entirely to environmental or quality departments. Decisions such as choosing suppliers, developing new products, purchasing machinery or accepting a long-term order can all affect the ability to meet future requirements.

What to Monitor in the Coming Years

The biggest challenge for textile businesses is not accurately predicting every future requirement, but building a system flexible enough to be updated as regulations and customer demands change. The EU’s legal framework has laid the foundation for a life-cycle approach to products, but detailed requirements will continue to be specified for individual product groups.

Businesses should monitor at least four issues. First are the specific requirements applicable to textile products and how they relate to manufacturers outside the EU. Second are data standards and information-sharing mechanisms within the supply chain. Third are the criteria for durability, repair, reuse and post-use treatment. Fourth is how brands translate regulations into purchasing conditions, evaluation indicators or audit requirements.

From a market perspective, this trend may widen the gap between businesses that only provide sewing capacity and those that can participate more deeply in product development. Factories with strong data, stable material controls and the ability to coordinate with customers from an early stage will have an opportunity to become long-term partners instead of being selected solely on the basis of contract manufacturing prices.

For Vietnam’s textile industry, preparing for EU green regulations should therefore not be viewed as a short-term campaign to meet the requirements of a single order. It is a process of upgrading management capabilities, connecting data, product design, materials and production efficiency. As transparency requirements become increasingly common, businesses that can demonstrate how they create their products will have an advantage no less significant than businesses that produce at low cost.