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Wood products shift with the times
Changing foreign consumer tastes have afforded Vietnamese timber furniture exporters with several advantages despite challenging economic conditions, according to the chairman of the Viet Nam Timber and Forest Product Association, Nguyen Ton Quyen.
"Before 2009, large markets such as those in the EU and America preferred furniture made from naturally grown timber while recently, trends have shifted to planted-timber due to cheaper prices and environmental impact," Quyen said.
Quyen added that thanks to new market advantages, high-end furniture exports had managed to reach around US$1 billion annually, exporters having found many new markets such as China and Japan.
Since there are currently only a few high-end timber furniture producers in Viet Nam, each has had just the right conditions in order to develop.
"Increasing input costs have impacted the whole industry, especially the high-end segment. However, there remains a large scope for development since the local market has not yet been oversaturated with manufacturers," Quyen said.
Agreeing with Quyen, the director of the Minh Phat 2 Company, Dien Quang Hiep, said that when the markets fell, the high-end segment was also affected, although not significantly.
As a result, Hiep's company had decided to increase investment in technology and human resources in order to triple the capacity of producing high-end products.
To develop the segment, experts have suggested that manufacturers and exporters improve management, design and quality as well as their advertisement activities.
In the current context, producing high-end products would help generate higher profits because only companies with large amounts of capital would dare cut prices related to low-end products while income costs kept on increasing, explained the deputy chairman of HCM City's Handicraft and Wood Industry Association, Nguyen Quoc Khanh.
In addition, Khanh added that it would not cost all that much to improve technology.
Responding to Khanh's ideas, Hiep said that in order to develop the high-end segment, companies needed to improve their management abilities, which would significantly contribute to long-term development.
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