Vietnamese factories gaining momentum
By Powell Slaughter -- Furniture Today, April 14, 2003
High Point — While Vietnam hasn't cracked the upper tier of case goods source countries, it's a place to watch, with cheaper labor than China and more factory capacity coming on line.
Its furniture exports to the United States quintupled in 2002 to $63 million, and that doesn't count what it ships elsewhere for completion.
Buyers at market here last week saw examples of Vietnam's case goods and occasional at a broad range of price points — including occasional and accents at Ferguson Copeland, and cases and occasional at Theodore Alexander, which also make Kings Row for Hickory White.
As in the Philippines, Paul Maitland-Smith is a driving force in Vietnam's development as a furniture source. He moved his Theodore Alexander factory four-and-a-half years ago from India to Vietnam, and has a 1 million-square-foot facility.
"We're building an extra 550,000 square feet as phase I of an 850,000-square-foot addition," said Anthony Cox, merchandising and marketing manager. The operation will employ 8,000 by year's end.
Theodore Alexander has its own plantation to supply acacia wood, a relative of mahogany, which it uses in 50% of its line. It imports veneers and American oak and cherry.
The "Cebu effect" is in evidence in Vietnam, where Maitland-Smith's operation has attracted finish suppliers, manufacturing support and buyers. Cox said Vietnam offers a wealth of workers well versed in native artisanship with brass and carving. Labor rates are half those in China.
Also in Vietnam are Taiwanese managers with long experience supplying furniture to the United States, creating a comfort level for U.S. companies.
Valspar and Akzo Nobel, he added, have technicians in the plants to train personnel and monitor finishes.
Standard sourced its first Vietnamese product, an occasional group called Majestic Pearl with mother-of-pearl inlay, for the April 2002 market, and added bedroom and dining this April.
There are around 70 Taiwanese companies operating in Vietnam right now, said Jeffrey Dilley, chairman of Excero Group, which does Vietnam market evaluations for U.S. furniture companies.
The real excitement, he said, is the number of Vietnamese companies investing in the furniture industry. Part of Excero's business is developing sales of U.S. hardwoods to Vietnamese makers eager to expand.
Jadora, launched in March 2002, has used Vietnamese craftsmanship and handiwork to quickly establish retail accounts in the United States, and the Santa Barbara, Calif.-based company has an 800,000-square-foot factory in Ho Chi Minh City set to go online at the end of the month.
Barry Israel, chairman of Jadora, said the High Point market was "unbelievable. We are delighted."
Jadora specializes in clean, contemporary forms that mix Asian styles, with case goods and occasional in American alder and American walnut.
Magnussen Home President Jeff Cook took his first trip to Vietnam last May. Magnussen sources occasional and accents at three plants, and case goods, he said, "are a matter of time."
Darrell Ferguson, president of Ferguson Copeland, plans to spend several weeks in Vietnam working on product for October. The company already sources many accents there.
Samuel Lawrence has sourced carving and some components from Vietnam for a couple of years, and that could increase, said President George Revington. "They're very consistent, the flow has been good, and they do what they say they're going to do," he said.
| Acknowledgements | ||
| E-business Editor Brian Carroll contributed to this story. | ||
