Handicrafts industry fails in efforts to boost exports

Small-scale handicrafts businesses were unable to boost their exports because of a lack of information about market requirements, their small scale, and outdated equipment, a trade official told a seminar that ended in HCM City yesterday.

Le Hoang Oanh, deputy head of the Trade Promotion Department under the Ministry of Industry and Trade , said as a result the quality of products was uneven and their design not diverse.

Tran Van Thi of the Marketing and Finance University said Vietnamese handicrafts products were less competitive than those from Sri Lanka, Malaysia, Hong Kong, mainland China and Thailand.

“One of the biggest obstacles they face is lack of access to capital to invest in technology and equipment. Moreover, their heavy dependence on imported raw materials limits production.”

Some of Viet Nam’s main export markets are Europe, ASEAN, the US, Australia, China, India, Malaysia, Germany, and Ukraine and the main products they buy are handbags, hats, umbrellas, porcelain, and bamboo, rattan, pottery, and wood items.

Thi spoke about regulations and idiosyncrasies in foreign markets that exporters need to understand: For instance, German buyers prefer environmentally friendly products while Malaysia does not buy porcelain and other products with images of people or animals.

Local authorities should provide artisans with training in marketing and technical aspects and offer support to craft villages through preferential land and loan policies.

They should also help popularise traditional craft villages’ brand names by using multimedia and improve artisans’ skills through training, he said.

There was need to build close links between producers and exporters to penetrate global markets and with travel firms to sell products directly to foreign tourists, he said.

Businesses themselves would need to pay close attention to developing trademarks and distribution channels in potential markets.

Do Duc Kha of the University of Economics and Law said to develop global distribution channels for handicrafts, businesses needed to first have an understanding of customers’ needs and existing distribution channels.

Independent speciality retailers were one of the largest distribution channels in the US and were ideal outlets for handicrafts, he said.

US buyers would prefer frequent changes in colours, designs and materials while in Japan, people would like to buy online from exporters, he said, (pointing out that Vietnamese businesses should therefore develop their websites).

Exporters should invest more in market research and develop skilled sale forces, he added.

Viet Nam is the third largest handicrafts exporter after China and Indonesia with a turnover of US$880 million last year.

There are about 2,017 craft villages in the country that employ nearly 13 million workers.

Tags: Vietnam Handicrafts industry