The sudden increase in demand for medical gloves to prevent the Covid-19 epidemic in 2020 becomes an opportunity for VRG Khai Hoan Joint Stock Company to increase profits to thousands of billions of dong.
Profit increased thanks to medical gloves needs to prevent Covid-19
VRG Khai Hoan Joint Stock Company is a member unit of Vietnam Rubber Industry Group, specializing in manufacturing and trading medical gloves, headquartered in Bau Bang district, Binh Duong.
VRG Khai Hoan produces gloves with two main product lines: Latex gloves (using domestic rubber materials) and Nitrile gloves (using imported rubber).
With a design capacity of about 2.5 billion medical gloves per year, from 2019 onward, VRG Khai Hoan’s factory operated only about 70% of its capacity. Profits range from 50-100 billion VND/year.
“With charter capital of VND 300 billion, such a profit is not high. Only in 2020, the company’s glove products will have better conditions to develop in the market as well as join the whole country in prevention and control. Covid-19 epidemic”, said Mr. Duong Duy Phu – General Director of the company.
Thanks to the good implementation of quality standard systems such as ISO 9001, ISO 13485, ISO 2000, GMP, SA 8000… so when the demand for medical gloves in the market spiked, VRG Khai Hoan was able to meet the demand. market requirements both at home and abroad.
Since the beginning of 2020, the number of orders has increased so that VRG Khai Hoan’s factory runs at 100% of its design capacity. Profit after tax for the whole year 2020 reached 1,440 billion VND, more than 14 times higher than previous years.
Currently, the Covid-19 epidemic is under control in the country. However, Mr. Phu said that the Covid-19 epidemic has changed consumers’ habits, for many products such as masks, gloves, hand sanitizer…
Mr. Phu forecast that at least in the next 5 years, the demand for medical gloves will still be high, due to the need to protect personal and family health as well as the need for national reserves.
“This is an opportunity for enterprises in the field of glove manufacturing to continue to grow in the post-epidemic period,” Mr. Phu assessed.
From this analysis and prediction, VRG Khai Hoan is planning to build another glove factory. Total glove production capacity is raised to 5 billion units/year; double the current. The plant is expected to come into operation in the third quarter of 2021.
Inside the largest medical glove factory of Vietnam
According to company leaders, one of the difficulties in producing gloves today is that many materials have to be imported.
As medical gloves products nitrile must import artificial rubber latex (synthesized from petroleum) along with many other chemical additives.
“Porcelain hands – tools to produce gloves must also be imported from Malaysia, but ordering all over Vietnam cannot be done by any unit,” said Mr. Phu.
According to the description, this porcelain hand is mounted on the chain to be dipped in the mixed rubber solution. Through the drying process, the glove is formed with uniform elasticity and thickness.
This porcelain hand placed in Vietnam can’t be made into a glove. Because when dipped in liquid rubber solution, the rubber slips off without re-sticking. Therefore, porcelain gloves are a rare commodity.
Each imported porcelain hand costs 55 USD/piece; has a shelf life of 2-3 years. To meet the needs of production expansion, from the beginning of 2021, VRG Khai Hoan has ordered a new series of porcelain handpieces from partners. However, it will have to wait until March 2021 to have the goods.
“Currently VRG Khai Hoan has received enough glove orders for 2021, even the output for 2022 has been ordered by partners, just waiting to finalize the product price depending on the price of input materials,” Mr. To share.