Opportunities and challenges of Vietnamese handicraft SMEs
Competitive advantages of Vietnamese handicraft suppliers
As a developing country, Vietnam brings advantages to both medium and small handicraft manufacturers including Green Craft and large- scale suppliers like Ngoc Dong and Lacquerworld. In addition to Vietnam’s abundant natural resources, its current labor costs are lower compared to countries like Thailand, Laos, Indonesia and China.
The current trend of big investors from Europe and America turning to Vietnam for sourcing due to China’s wage increase (as covered in The Wall Street Journal) is a boon to businesses like Green Craft and serves to boost Vietnam’s economy.
Strengths and difficulties of Green Craft as a small company
Green Craft was established in 2006. The company descended from a family business. In 1994, the mother of Green Craft’s director founded Thuan Phat Co. Ltd, which specialized in textiles in early years and later expanded into handicrafts. In 2002, due to difficulties, Thuan Phat was closed. Green Craft was born four years later.
Green Craft is a small enterprise, so it benefits from leaner operations compared to large- scale suppliers. With a small staff, the director can know the strengths and weaknesses of each employee and be flexible in the work assigned to them . Every company has its areas for growth, however. Green Craft continually works to improve its productivity, designing and sampling.
A majority of Vietnamese small and medium enterprises do not have in-house designers or specialized design staff. Some hire freelance designers while others buy designs from studios. The production process from designs to finished products involves a lot of time and effort. Many potential Green Craft designs cannot be brought to life due to complexity, high production cost or low marketability. Yet when a product does go from idea to reality, it is very gratifying.
Green Craft’s vision
Based on Green Craft’s recent research and surveys, the major trends for the next one to three years are green and functional items. These two elements are the current strength of Green Craft products. Green Craft focuses only on natural and recycled materials and functional items such as bowls, plates, vases, lamps, mirrors, furniture, etc.
Some future goals for Green Craft include improving design capabilities to ensure customers’ needs continue to be fully met. Additionally, it plans to upgrade its production speed to get samples to buyers even faster . Finally, it will further distinguish and improve its low-end, midrange and high-end items to ensure its products are distributed to all markets as effectivel as possible.
About the Author – Yen Binh Hoang