Source: tapchitaichinh.vn
Orders drop
Every year at this time, wood businesses are rushing to produce to keep up with orders for partners in the fourth quarter and pillow next year. However, this year, with the two major markets, the US and the EU, the impact of inflation has led to a decrease in demand, directly affecting the activities of businesses in this industry. Accordingly, this year, the business’s orders were not available, so the sales volume also decreased sharply.
Mr. Nguyen Duy Toan – Deputy General Director of Hong Ky Woodworking Machinery Manufacturing Company (Ho Chi Minh City) shared that the situation of supply chain disruption as well as consumption demand has been seriously reduced in the markets. has directly affected the export activities of wooden furniture exporters, leading to the units involved in the wood processing industry being affected as well. Like Hong Ky Woodworking Machinery Manufacturing Company, up to now, the production and business situation has also been seriously affected, compared to the same period, the sales volume has decreased by 70%.
Huynh Quang Thanh – General Director of Hiep Long Wood Co., Ltd. said that if from January to April 2022, exporting wood is very good, sales increased but from May to September sales fell and fell ominously. Since most businesses lack orders, only a few businesses have enough work to do 6 days/week. According to statistics, currently, up to 50% of enterprises reduce their capacity by 50%.
“In 2022, Hiep Long can only achieve about 95% of the target plan,” Mr. Huynh Quang Thanh shared.
In fact, the export of wood and wood products is facing difficulties and continues to decelerate in some major markets such as the US and Europe (EU). Specifically, the US is the industry’s largest consumer market. wood (accounting for more than 55% of the total export value of the industry in the first 9 months of the year) is continuing to decline. This is also the main factor that makes the wood industry, although recording growth, is still difficult to be optimistic in the remaining months of 2022.
Mr. Vu Tien Thap – Chairman of the Board of Directors of D’Furni Furniture Joint Stock Company shared, the amount of furniture inventory in the US is currently too large. During the outbreak of the Covid-19 epidemic, they imported in large quantities but have not yet consumed all of them.
“I have just returned from the world’s largest furniture fair held in the US, I have never seen this fair so quiet. The first is the lack of Chinese businesses they do not participate in, the second is the lack of consumers because the effects of inflation make them not eager to new interior trends. Thirdly, many businesses from all over the world are also not interested in participating in the fair at this time because the purchasing power has decreased too much, “said Mr. Vu Tien Thap.
According to data from the Import-Export Department (Ministry of Industry and Trade), the export value of wood and wood products in the 10 months of 2022 is estimated at 13.5 billion USD, up 11.4% over the same period in 2021. In October 2022, the export of wood and wood products reached 1.2 billion USD, up 7.7% compared to September 2022. Although still growing, this growth momentum has not been able to reach double digits as in the previous period. With the current growth rate, it is forecasted that the export target of 16.5 billion USD for the whole year will be difficult to achieve.
Find solutions for diverse markets and maintain market share
During this period, many argue that exploiting new markets is one of the best solutions in the current context. In addition, downsizing the production scale, taking good care of existing customers, as well as focusing on the domestic market more is also an effective solution that wood industry enterprises need to do in the current context. in.
Mr. Tran Quoc Manh – Vice Chairman of the Vietnam Handicraft Association said that in the context of the US market’s decline in consumption, the Middle East market is emerging as an ideal market. There will be big events like football coming up here, which will lead to huge consumption of wood products.
For traditional markets, in order to maintain market share, there is no other way but to improve the competitiveness of enterprises. Mr. Ngo Sy Hoai – Vice President and General Secretary of the Vietnam Timber and Forest Products Association recommended to businesses that a quick transformation is needed.
“For a long time, our wood industry has been growing in breadth, we use labor, use large input materials to create product value. Perhaps in the coming years we must have a transformation, have to make a big turning point, go into processing and export to have higher value-added product groups, using less labor. , less input materials to consolidate and increase market share in traditional markets,” said Mr. Ngo Sy Hoai.
Besides, enterprises must pay attention to invest in corporate governance, use modern accounting software, ensure transparency of input and output. Currently, when enterprises accelerate the export of wood products, they also have to face more and more trade defense lawsuits related to the origin and the legality of input materials… enterprises with a better corporate governance system may have better trade defense capacity.
Next, like other industries, in addition to making good use of the opportunities that digital technology brings, the Wood Association as well as local associations with the support of the Ministry of Industry and Trade also organize a lot of meetings. fairs and exhibitions to promote brands, introduce products and attract customers to come.
In the coming years, promotional activities must increase in scale at the national level, not just businesses, how to really turn Vietnam into a responsible and competitive wood processing center. good and sustainable.
