Page 560 - ISC PROCEEDINGS 21.4

arise from market developments and changing tax policies, the lack of a legal framework
for transactions in the current digital economy (such as the risks associated with
reciprocal tax policies), the fragmentation of global regions that could affect the
production and business of textile and garment enterprises, and the rapid market
changes (within just one or two weeks) making medium- and long-term forecasting
models impractical. Fifthly, international customers are becoming increasingly demanding,
requiring low prices, tight deadlines, and compliance with green standards and CO2
emission reductions. Meanwhile, competitors like Bangladesh, India, and Indonesia are
leveraging their advantages of cheap labor and favorable domestic policies, resulting in
more stable costs and increasing competitive pressure. Lastly, businesses are currently
facing a shortage of highly skilled digital workforce, and the awareness and strategies of
senior managers regarding the transformation of business operations in the digital
economy remain incomplete and lack specificity. These challenges reduce the operational
efficiency and competitiveness of Vietnamese textile and garment businesses in the
digital economy. Therefore, in order for the Vietnamese textile and garment industry to
have sufficient capacity to continue developing, perfecting the entire industry's supply
chain, enhancing automation and greening production, digital transformation, aiming for
its own brands and high-tech products in the digital economy, it is necessary to
implement necessary measures such as improving technological infrastructure, using new
technologies in production, improving technological processes towards green practices,
building circular production processes, applying blockchain for traceability, optimizing
production costs and applying ERP in management to optimize resources.
To make relevant cost decisions, managers need comprehensive, specific, and
continuously updated cost information. Traditional costing models based on output
allocation have lost their accuracy, leading to inappropriate strategic decisions. The
Activity-Based Costing (ABC) model, first mentioned by Thomas Johnson, Robin Cooper,
and Robert Kaplan in their book “The Loss of Relevance: The Rise and Fall of Management
Accounting” (1987), is considered a method for improving cost collection, tracking, and
calculation. ABC is not just a model for determining costs; it is also served as a strategic
cost management tool that helps optimize costs. Beyond determining costs accurately,
ABC helps businesses identify which activities create value and which do not, thereby
enabling continuous improvement of business processes to reduce costs, enhance the
ability to meet customer demands for price and green standards, and ultimately improve
the competitiveness of Vietnamese textile and garment businesses. Applying the ABC
model to collect and track production costs is considered one of the key solutions to
address the challenges facing textile and garment businesses in the digital economy.
The authors focused on researching the following issues: the characteristics of
textile and garment businesses in the digital economy, the ABC models and their
applicability to these businesses, and the factors influencing the implementation of these
models in Vietnamese textile and garment businesses. The aim is to help save costs and
improve business efficiency in the digital economy.
2. Theoretical basis
The research is based on the following theoretical foundations:
Cooper and Kaplan (1988) and Johnson and Kaplan (1987) were among the first to
propose ABC theories. This costing model is designed to assign overhead costs to cost
objects directly. ABC helps managers make informed decisions regarding their product

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