Wood industry towards export links

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HawaExpo has become an important link representing Vietnam in the chain of furniture export fairs in Southeast Asian countries. Photo: TL

Many new opportunities are opening

A lot of positive information about the export of wood products was raised by experts and businesses at the Vietnam Furniture and Wood Industry Forum in Ho Chi Minh City last weekend. Ms. Tran Nhu Trang, representative of SIPPO Program in Vietnam, said that the major export markets of Vietnam's wood industry such as the US, Europe, the UK, Japan, and South Korea... have shown signs of recovery as people Consumers are starting to return to shopping after a long period of saving. Besides, Ms. Trang also pointed out potential new markets for Vietnam's wood industry such as the Middle East, India, Australia, Canada, and ASEAN. In particular, the Middle East market has a very fast growth rate with cultural diversity and people are willing to pay high prices to buy good quality products. The Canadian market also has a high level of spending on interior and exterior furniture and the market is also showing signs of warming up for home construction and repair activities.

Sharing the same opinion with Ms. Trang on new markets for the wood industry, Mr. Nguyen Quoc Khanh, Chairman of the Ho Chi Minh City Handicraft and Woodworking Association (HAWA), said that the Middle East region is being considered as an investment destination of the decade. This is the land that is being planned for the construction of super projects. Typical can be named as super project NEOM in Saudi Arabia with 4 complexes Sindalah, The Line, Trojena and Oxagon; super project The Mukaab (New Murabba) worth USD 800 billion; Mirror Line super project with an investment of USD 1 trillion... All projects need furniture, and also high-end furniture.

Information from the Vietnam Trade Office in the UAE shows that furniture imports in countries of the Gulf Cooperation Council (GCC) have a growth rate of more than 45% per year while almost these countries do not manufacture furniture for export. Faced with these great potentials, the big brands of the Vietnamese furniture market such as Tran Duc, AA, Minh Thanh... have signed contracts to buy large booths at furniture exhibitions serving the Dubai market. Khanh said that through the exhibition, businesses have signed a lot of contracts, helping to offset the decline of traditional markets.

According to experts, Vietnam's furniture industry has always been actively supported and accompanied by trade promotion agencies. Vietnamese Trade Offices abroad always create favorable conditions for Vietnamese enterprises to access new markets. With enough tools and potential, Vietnamese enterprises can completely penetrate and seek opportunities in other potential markets.

Besides the good news about the market, from an investor's perspective, Mr. Chad Ovel, General Director, Mekong Capital shared, with big examples such as AA Corporation, An Cuong, Truong Thanh... Vietnamese furniture industry is quite impressive in the eyes of investors. Accordingly, Vietnam's furniture industry has the opportunity to receive the investment wave and post-inflation growth wave.

Connecting, converging resources

The opportunities are huge and businesses have clearly identified, but how much they can grasp depends on the vision and strategy of enterprises as well as of the Vietnamese wood industry. Despite having good quality, high sophistication and having been present in many of the world's most high-class projects, for many years the wood industry has still been biased towards processing but has not been able to exploit the higher values in the supply chain. . Many businesses are constantly looking for solutions to reach end-users and penetrate directly into the furniture supply chain in international markets, but they are still not really successful.

For example, when starting to work as a distributor in the US market, businesses face many difficulties and problems related to legal issues. According to US law, businesses are required to establish a business here so that they can be responsible if they want to sell goods. Next is the problem of warehouse, goods management, human resources... Most especially, the culture of return goods is completely different from Vietnam. The completion of the business apparatus and processes in the US requires enterprises to be expensive and takes a long time, and the legal risks are high, so the investment costs are also very high.

From those difficulties, from the perspective of the association, Mr. Nguyen Quoc Khanh proposed the idea of a logistics center - promoting Vietnam's furniture trade right in the main market. Accordingly, this model will act as a representative office, businesses converging in this model can be legally orthodox in doing business in the host market; there is space to approach customers, receive contact information from official employees with the company's company name, secretarial services upon request... Along with that, the warehousing system will help businesses be able to store goods to promptly meet customer needs, delivery, feedback, customer care... In addition, the center can also deploy other services such as helping businesses do market research market, product development, showroom, customer access, marketing, etc. Thereby, it will help to remove some difficulties in costs and risks, help improve professionalism… This model is completely to meet the online export needs of enterprises as well as create favorable conditions for enterprises to export projects.

In addition to the association plan to dominate the international market, over the past time, the association between wood industry associations in trade promotion has also brought many positive results. Accordingly, the Ho Chi Minh City Furniture and Furniture Export Fair (HawaExpo) organized by the 5 largest wood associations in Vietnam earlier this year attracted more than 16,000 visitors, including more than 2,600 international visitors from 101 countries and territories. According to preliminary statistics of the organizers, 64 contracts and cooperation minutes were signed at the fair with the total value of orders recorded at USD 3.6 million.

On the basis of those positive results, HawaExpo 2024 will continue to be held on the largest scale ever. It is known that most of the enterprises participating in the 2023 exhibition have re-signed their contracts to participate in HawaExpo 2024, in addition, a large number of new exhibitors have registered to participate. This shows the practical effect that this event brings to businesses.