To expand the export market of Vietnam furniture based on new internal strength
The development characteristic of the wood industry has been spontaneous for the past 25 years, but fortunately it is on the right orientation and has been really developing now. And from the overview, if the State supports the industry, it will grow much stronger and bigger. That is the opinion of Mr. Huynh Quang Thanh - A chairman of Binh Duong Furniture Association, General Director of Hiep Long Co., Ltd.
In my opinion, the Ministry of Agriculture and Rural Development is wondering whether the timber industry has sustainable growth and has achieved the export target of US$9 billion in 2018 or not? And the trend in the world has been still using furniture for many years, combining with the change in the use of raw materials for furniture. Therefore, in order to develop proactively, there must be a leader who have detailed, clear orientation. In addition, there should be a macro orientation from the State authorities on the issues such as raw materials, vocational training, marketing and market expansion.
For both domestic and import material sources, they must be stable and proactive. Meanwhile, in the field of vocational training, Vietnam is still having the theoretical training (accounting for 80%), practical training only 20%, and mainly teach engineers rather than skilled workers. For such a training fact, the labor productivity of Vietnamese enterprises has been limited. We have been now competing with other countries at the lower wage (50% lower than China), and lower than Thailand and Malaysia. So many orders from China has been transferring to Vietnam.
There will be a shift towards the country where has the price for more competitive products. But at some point there will be the close-ups of wages, this is not a competitive factor anymore, then labor productivity is a decisive factor for product prices. Adapting to a competitive economy will last long. The world market is always fluctuating, it needs stable and competitive price, quality and labor productivity to exist and develop sustainably.
The advantage of Vietnam’s woodworking industry develops in the long term and bases on the private economy. For the private economy, the succession training is important. Most of the successors are well-trained and sent abroad to study. With the well-trained successors, the next generation of woodworking industry in Vietnam will develop better than the current period and this will also help the industry to develop better.
While the State authorities need to have influence on other major issues such as marketing support, because most Vietnamese businesses are not good at marketing their products or because of limited financial conditions, or limited foreign ability or not enough confidence to introduce their products to the international market. The marketing team should be trained to develop the wood industry better. The marketing through the ways such as taking part in fairs, exhibitions to know the trends of new models and products, our marketing has often been passive for much time.
In the next time, we should focus on the US market, this is a rich and vast country with more than 265 million people, the middle class is big and the US has the policy of encouraging investment, allowing the people to buy house, they can buy as many as they want providing they have money and that amount of money is legal. The rich in the world tend to study abroad in the US, so the US housing market is still developing. American trend is moving from place to place. As a result, the real estate in the United States always grows and the furniture industry follows to develop too. In the next time, the US market is still an important market. Thus, this market still maintains and grows.
China market is the long market, this country consumes the timber materials in the top of the world, the dynamism of this market is very strong. For the Chinese market with more than 600 million households, the replacement cycles for furniture products are from 10 to 15 years, this is a potentially large market.
The European market is old and will maintain the stable rate. In the Japanese market, due to the shift trend of investment, the enterprises investing in China tend to transfer to Vietnam because the labor cost in China is rising, along with the US market, this market should be focused for Vietnam.
Origin: No. 100. VIETNAM TIMBER & FOREST PRODUCT ASSOCIATION.