by HO CHI MINH CITY, Vietnam — Before the April High Point Market, Home News Now interviewed several furniture manufacturing executives in Vietnam about the state of the industry and their thoughts on the business moving forward. These executives, many of whom produce furniture for the U.S. and other markets, also spoke of challenges and opportunities that lie ahead. In this Q&A, they also shared their thoughts on the balance of the year.
Home News Now: Based on what has happened thus far this year, what is your outlook for the Vietnam furniture industry for the next six months or more?
Our backlog remains strong and the new projects in sampling would tell us that 2023 will be OK. But, in general, I cannot see the overall situation at the mass and lower end improving until this time next year. Your questions (about the state of the industry) hit on all the key points of today’s situation, which, by the way, was 100% predictable: All the retailers ordered up and filled their warehouses in spite of the certain end of the Covid effect.
Harvey Dondero
Chairman, H. Nicholas & Co.
The outlook doesn’t seem too good. My personal take is that things may pick up in the fall. In periods of low demand, we need to work to strengthen the internal core of our business. This includes improving efficiency, reducing waste, having better-managed inventory and controlling costs. We also are looking at the environmental sustainability of our organization and are implementing some sustainability initiatives.
Ernie Koh
Director, Koda Ltd.
In a broad factory view of Vietnam, there are winners and losers when demand does not meet the supply. We have seen order-entry increases in recent months and have some additional large programs coming online also in this timeline. We expect business to stay soft at retail but we expect our production to remain steady or grow. The winners will capture a larger piece of a smaller pie. Our expansion in the future will come with more efficient increased outputs internally and more cooperation with outside sources where we share components together and split manufacturing duties.
Thomas Luk
President, Starwood Furniture Manufacturing
The outlook is more of the same. We see inventories taking another few months to settle and then we will start to see some light. And since the anti-tipping issue was resolved, we are starting to get some bedroom reorders that had been put on hold. This, along with strong product development, continues to show us new production in between markets as well. We also are continuing to push our next strategy for the T&V Design Network, and we anticipate this additional energy and push to result in positive gains.
Brian Beane
Business and product development specialist, Thinh Viet
We are coming off a very high peak in the first half of 2022, so some normalization is to be expected. We have right-sized production accordingly. Our quality and craftsmanship remains unsurpassed. With competitive container rates, the value equation of Vietnam offerings is sharp. Maxwood is expanding its business to adult bedroom and dining. As such, we can offer quality, solid wood products on mixed containers.
Stephen Jensen
President, Maxwood Furniture
Business has been slow following Tet with everything that has been going on. We don’t expect business to pick up until possibly the third quarter, simply because inventories are still high, inflation is high and the economy is not recovering.
Mohamad Amini
President, Lacquer Craft Manufacturing
In the 70’s when I was a rep for Thomasville almost everything was made in America. In the 80’s I was a rep for Pennsylvania House and Rowe Furniture. Again everything was made in America. I made money and every dealer I called on made a lot of money. I don’t know why American manufacturers who were doing so well felt the need to stop making products here. Those were great times. Was it greed?
Today it’s a different world. Very little furniture is produced in this country. As a matter of fact very little of anything is manufactured here. The American service industry representing banks, credit cards, and almost everything else is outsourced today. When you call for support it’s a total joke and frustrating as hell because no one can understand each other. I called 1 800 Flowers this week and it took almost 2 hours to place an order in whatever country I landed. I guess what I’m saying is American companies need to wake up before it’s too late. We are going through crazy times and it could bite us all in the ass soon. Just some of my thoughts for what ever it’s worth.