Factors Affecting Innovation in The Textile and Garment Industry: Evidence from Thanh Hoa Province, Vietnam

This paper focuses on examining the factors influencing innovation in textile and garment enterprises located in Thanh Hoa province, in the context of increasing pressures for transformation and growing competition within the industry. The study employs a quantitative research method through Partial Least Squares Structural Equation Modeling (PLS-SEM) using data collected from 186 textile and garment enterprises in the province. The research findings indicate that four internal factors - technological capability, corporate culture, financial capacity, and leadership style - positively impact innovation. However, government support shows no significant effect on innovation. This finding raises important concerns regarding the effectiveness and efficiency of public policies in promoting innovation within the local textile and garment sector. The study also provides several recommendations for both enterprises and government agencies, emphasizing the critical role of endogenous capabilities in driving innovation, while highlighting existing limitations and offering solutions for more effective policy implementation at the local level.