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WOODEN FURNITURE EXPORT In recent years, the export markets for Vietnam’s wooden furniture in the United States, Europe and Japan have grown impressively. With its desire to export more wooden furniture and household products to the United States, the Ministry of Trade’s Trade Promotion Agency has arranged for a business delegation to participate in the High Point Fair held from April 22 to 28 in Northern California. High Point is a wooden furniture and household products specialty fair held biennially by the prestigious American Market Authority company. It attracts more than 2,400 producers to show their furniture and household products. There are around 75,000 visitors, most of them big wholesalers and importers, not only from the US but also from 110 countries other countries around the world. This Fair will be a precious opportunity to connect Vietnamese furniture and household product producers and exporters with American importers, distributors and consumers. From 2001 to 2003, the growth rates for Vietnam’s wooden product exports were 53%, 30% and 30.3% respectively. In the American market, where Vietnam is one of the top 25 exporters, this rate was 155% in 2003. Also during 2003, total turnover for Vietnam’s wooden product exports to this market was $155m. Vietnam hopes to increase this to $750m in 2004 and $1bn in 2005. The price of Vietnam’s wooden products is 8-10% cheaper than that of China, the biggest exporter to America with $5.6bn in export turn over in 2003. Vietnam has become a popular destination for US wooden furniture importers as the US furniture industry continues to modify its import patterns after the antidumping petition against Chinese wood bedroom furniture manufacturers. This is due to the fact that the furniture imports continued rise in the US while at the same time tariffs on the Chinese furniture also inflated. This shift from China is having a massive effect on the wood furniture export industry in Vietnam. According to Vietnam’s Ministry of Agriculture and Rural Development, last year Vietnam exported around USD 1.2 billion in wooden products, most of which was furniture, but that is expected to rise to between USD 1.4-1.6 billion during 2005. “Right now Vietnam is exporting furniture to over 120 countries worldwide,” says J.D. McClellan, managing director of Diamond Keystone Associates, a Vietnam based furniture export sourcing company, “but no market is having more of an effect on Vietnam than the United States right now, and I don’t see that changing for some time to come.” The Vietnam Economic Times has also reported that Vietnam’s industry now boasts over 1200 furniture factories with some very serious growth, stating that the export value of the wooden furniture market for the first six months of 2005 is up 86% from the previous year, and most of this is outsourced product. But J.D. McClellan contends that if importers aren’t careful this trend can bring pitfalls as well as opportunities. “American importers should realize the vast opportunities for their businesses here, but at the same time it is extremely important to have a professional representative on the ground in Vietnam,” says McClellan, “because all kinds of things can, and do, go wrong if someone is not here to follow the production processes on behalf of the importer. This includes choosing the right factory for manufacture, to the design, to the actual manufacture, to packaging to keeping the schedule for the final export shipping.”
More and more
though, Vietnam is proving to be worth the effort. Just ask J.D. “At
some of the factories we deal with a learning curve everyday, but at the
end of the day we are making sure the client gets better value out of
Vietnam. I see a bright future with the growth of Vietnamese exports and
US wooden furniture imports linked together.”
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