Vietnam lacquerware sector enjoys support from gov't, private groups

Vietnam's lacquerware industry is enjoying the support of government ministries and non-government organizations, which implement programs designed to boost the sector.

Trade associations and NGOs are focusing recently on Vietnam lacquerware sector in the province of Binh Duong in the south.

It has long been the center of lacquerware production in the area, particularly the village of Tuong Binh Hiep. Pottery and vases from this region usually have intricate designs and a finish that becomes shinier over the years.

To boost further development of the province's craft, the Binh Duong Department of Science and Technology in cooperation with the Binh Duong Association of Lacquerware and Sculpture or BDLS executed a project that aims to protect through laws, manage and explore the Binh Duong Lacquerware brand.

The program includes policies that help recognize counterfeit models and introduce various marketing methods.

The BDLS, furthermore, supports lacquerware enterprises to participate in trade fairs and exhibitions. The business group is also advocating for more technological innovation to enhance product quality.

Designs courses are likewise regularly offered to lacquerware suppliers.

Last January 2015, the British Council in coordination with the Handicraft and Wood Industry Association held a workshop attended by the 24 leading export companies in the handicraft and home decor sectors in Ho Chi Minh City.

The facilitators are from Cockpit Arts, a UK-based company which discussed approaching new markets and forecasting trends.

Some joint projects are also being implemented to help the handicraft industry, particularly the collaboration between the UN and the Spanish.

Government's MDG Achievement Fund. The program promotes sustainable management in five sectors: bamboo and rattan, sericulture and weaving, seagrass, lacquerware, and handmade paper. The aim is to create jobs for the artisans and farmers who grow and collect raw materials.

About 4,800 households in the north will be trained to better plant, cultivate and harvest lacquer trees.

A partnership between the United Nations Industrial Development Organization and the Department of Agriculture and Rural Development of the northern province of Phu Tho created a seminar for China and Vietnam lacquerware firms. The conference introduced processing techniques of lacquer berries to make wax products.ve their factories out of the area. Other policies include reduction in income taxes and import duties.

Vietnam lacquerware exports

The government does not have an official categorization of lacquerware items. Instead, the sector is composed of rattanand bamboo products, wood and wooden products, and glass and glassware.

Vietnam Sourcing: Lacquerware Industry overview exports.

The total exports of all three groups for the first five months of 2015 reached $3 billion, which is a 10 percent increase compared with the same period in 2014.

In general, the sector's overseas sales rose in 2014. Rattan and bamboo products shipments surged by 8 percent, wood and wooden products by 10 percent, and glass and glassware by 35 percent.

Vietnam Sourcing: Lacquerware Industry overview exports. The US is the main market, accounting for nearly one-half of orders. Japan is the second significant destination, taking up about one-fifth of exports. Other key markets include China, South Korea and the UK.

Competitive advantages

A deep pool of skilled artisans is the primary strength of the industry. Handicraft villages located in various provinces have been manufacturing lacquerware for generations and are adept in labor-intensive processes, including wood- and metalwork, and pottery-making.

An abundant supply of raw materials is another advantage enjoyed by the sector. The main components used such as bamboo, MDF, lacquer wood and glaze are readily available nationwide at competitive prices.

Suppliers' flexible MOQ encourages clients to sample lacquerware from the country. While the average MOQ is 1,000 pieces, some companies are willing to lower it to less than 10, depending on the product specifications.

Challenges

There are several roadblocks to the sector's continued development.

Lack of marketing and human resource training is one such difficulty. Although there are many skilled artisans in the country, they are not trained to adapt new manufacturing processes and have relied on traditional methods they have learned from the previous generation.

They also lack knowledge on the different ways that their crafts can gain international exposure. Instead, they rely on tourism and word-of-mouth.

Design limitation is another obstacle. Since most orders depend on clients' specifications, suppliers are not compelled to create original styles. Researching new materials and better production methods are also not prioritized mainly because of lack of funding. Limited capital, furthermore, prevents SMEs to upgrade their factories and equipment.

Another concern faced by the sector is underdeveloped auxiliary industry for handicrafts. Most suppliers rely on sourcing some materials from China because of competitive prices, better quality and wider variety. This adds to increasing production costs, however.

According to Vietnam Association of Lacquer and Sculpture, manufacturing expenditure has been increasing by 15 percent yearly, making it difficult for companies to offer competitive prices.

This article and its contents are provided by the Hinrich Foundation, a partner of Global Sources in promoting trade across Asia. The products and the suppliers featured in this article are export assistance program beneficiaries of the Hinrich Foundation.

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