return icon Vietnamnet.vn

Wooden furniture manufacturers still cannot exploit advantages

VietNamNet Bridge - Wooden furniture manufacturers enjoy preferences thanks to a zero percent import tariff applied by many big export markets. However, very few enterprises can exploit the advantages.

VietNamNet Bridge - Wooden furniture manufacturers enjoy preferences thanks to a zero percent import tariff applied by many big export markets. However, very few enterprises can exploit the advantages.

 


{keywords}


One of the names in the group of businesses that export products under their own name is AA Corporation, which provided interior furniture to 5-star hotels and cruise ships. 

It is one of a few Vietnamese companies which can provide products under the AA brand to international construction works, including Accor, Sofitel and Ritz Carlton in America, Europe and the Middle East.

Wooden furniture manufacturers enjoy preferences thanks to a zero percent import tariff applied by many big export markets. However, very few enterprises can exploit the advantages.
Established as a fine arts enterprise, Gia Long Company has gradually jumped into the wooden furniture manufacturing factor. Gia Long unexpectedly displayed collections of wooden furniture products at the recent Vietnam Wooden Furniture and Interior Decoration Trade Fair.

Tran Viet Tien, director of Gia Long, believes that there are always great opportunities for enterprises which can design products of their own.

“The design can make up 50-60 percent of the products’ value. This explains why enterprises which can design products always can get better profits,” he said.

However, not all enterprises can design products like AA and Gia Long. Scansia Pacific and Minh Phat decided to go their own way – making products in accordance with designs from Germany and Denmark.

An analyst noted that Vietnamese manufacturers prefer hiring foreign designers because domestic designs cannot satisfy them. But this is not always the best choice. 

Minh Phat at one time hired Malaysian designers, but it is now an outsourcing enterprise. It was too costly to hire foreign designers, and difficult to sell products under Vietnamese brands.

Outsourcing for foreigners

Minh Duong Company is well known in Vietnam for its high stable growth rate of 13 percent per year. After two decades of operation, it now has four factories and seven production workshops with 2,000 workers who make products for the South Korean, European and the US markets.

However, despite the large scale, Minh Duong has a low profit margin and faces high risks. 

An analyst estimated that the profit margin for outsourcing enterprises is not higher than 5-7 percent.

Artificial wood

While the majority of Vietnamese enterprises still make products of natural wood, some have tried with artificial wood and have had encouraging results.

Le Duc Nghia, CEO of An Cuong, said in 2014, the company invested $3-5 million in its artificial wood processing factory.

Nghia said only 5 percent of Vietnamese enterprises use industrial wood in making wooden furniture products, while industrial wood has been used by Thailand and Malaysia for a long time. The two countries make products for export to the US and Europe.


NCDT

MORE NEWS

Authority maintains tough stance on safety violations on Hanoi’s “railway café street”

The Vietnam Railway Authority has insisted that it will take a hard line on railway traffic safety violations along Hanoi’s popular "railway café street" sketching across the inner districts in its recent report to the Ministry of Transport.

Foreign hi-tech firms expand investment in Vietnamese market

Molex, the world’s leading supplier of connectors and interconnect components, has unveiled its ambitions to expand its existing manufacturing plant in the Vietnamese market by developing its plant in Hanoi.

VIETNAM BUSINESS NEWS OCTOBER 4

Hai Phong lures more than 1.24 billion USD in first nine months

Vietnam rakes in US$16.05 billion from tourism in nine months

Vietnam earned some 394.2 trillion VND (16.05 billion USD) from tourism in the first nine months of this year, equivalent to 78% of the figure recorded in 2019 before the COVID-19 pandemic broke out.

VIETNAM NEWS HEADLINES OCTOBER 4

Vietnam invests in 10 energy technologies

Vietnamese poetry collection published in Canada

A poetry collection from five female translators based in Hanoi, entitled Ngũ Sắc Ánh Sáng (5 Sights of Light), has been introduced to Canadian readers by Ukiyoto Publishing.

Multi-billion thermal power project needs more capital

The Ministry of Industry and Trade (MOIT) has asked for ministries' opinions on solutions to problems related to the balance sheet of the Vung Ang 1 thermal-power plant.

The best September photos on VietNamNet

Hot air balloons with the Vietnamese national flag of 1,800m2 on the banks of the Saigon River, Typhoon Noru making landfall in Quang Nam Province, the roofs of many houses being blown away...

BSR to expand Dung Quat Oil Refinery

The Ministry of Industry and Trade (MOIT) has asked Binh Son Refining and Petrochemical JSC (BSR) to clarify some issues related to its project on expanding Dung Quat Oil Refinery.

Dutch conductor to lead concert at Opera House

Conductor Leon Bosch from the Netherlands will lead a concert featuring masterpieces by European composers at the HCM City Opera House on Saturday, October 8.

‘578’ to represent Vietnam at Oscars

An action film starring Miss Universe Vietnam 2018, H'hen Niê, 578: Phát Đạn Của Kẻ Điên (578: Magnum), has been selected as Vietnamese representative at the 95th Oscars, 2023.

USD surges to VND24,000, US$1.7 billion withdrawn from circulation

The State Bank of Vietnam (SBV) withdrew nearly VND41 trillion ($1.7 billion) through open market operations as the US dollar rose to over VND24,000 on September 26-30, 2022.

HCM City to build a series of new traffic projects

HCM City is speeding up procedures to start the construction of key traffic works at gateways by the end of the year, according to HCM City's Department of Transport.

Burning garbage in Hanoi threatens residents' health, property

There have been consecutive fires caused by people's poor awareness, who were burning garbage and straw in residential areas, causing fires recently in Hanoi.

New cargo airline still waiting for license

After the Prime Minister agrees on the establishment of IPP Air Cargo, the Ministry of Transport (MOT) will implement procedures to grant a license to the air carrier, according to MOT Deputy Minister Le Dinh Tho.
back_to_top