Trade Wars and Moving Furniture Production to Vietnam.

Trade Wars and Moving Furniture Production to Vietnam

Trade Wars and Moving Furniture Production to Vietnam. While President Trump continues his trade war with China.

The back-and-forth tweets and headlines are volatile.

Today the low-level Chinese delegation due to visit some USA agriculture suppliers cut short their visit and returned to China. See here: http://xhnewsapi.zhongguowangshi.com/share/news?id=351561019723776

If you have been keeping up with trade war events you will know this is a wider and more complicated issue.

The USA is also addressing the possibility of IP theft and security issues, see here:  https://www.theguardian.com/technology/2018/oct/04/china-planted-chips-on-apple-and-amazon-servers-report-claims

Companies that have furniture supply lines positioned solely in China, may have already switched to other countries. 

As this situation is complex and no business can risk hoping and waiting for a resolution, we deal with our experience of making furniture and custom furniture in Vietnam.

This post does not deal with setting up your own factory in Vietnam, for some information on these issues, you may want to review this article https://www.scmp.com/economy/china-economy/article/3018403/chinese-manufacturers-returning-home-inefficient-vietnam

 

This post solely deals with sub-contracting and sourcing from established factories in Vietnam. Let us explore the five of the most important questions and issues, relating to supply, it’s consistency, quality and what is the best approach in building a quality supply chain.

Considerations for doing business in: (Trade Wars Furniture Vietnam)

 

1. You are not the only buyer coming to Vietnam. The influx is putting a lot of pressure on wages. Production capacity is limited.
2. There are two supply chains for buyers coming to Vietnam to consider:
   1. Buy direct from factories
   2. Buy from sub-contractors – This is the area of our business

3. Working In Vietnam.

   1. Vietnam is not China, a lot of companies are able to purchase from China with no quality control staff. This is not advisable in Vietnam.
   2. You will product drawings for your products inVietnam
   3. Samples take time in Vietnam, unlike China,
   4. You cannot give basic drawings and hope the factory will fill in the blanks
   5. You will need to have your product information ready and organized.
   6. You will need to put experience middle management on the ground train your managers and QC staff.

4. Working with Trading Companies in Vietnam

   1. This is where our company comes in. (we also develop and design our own products so you do not have to)  We take away these setup costs and the timescale involved, not to mention the pitfalls and staff turn over that it takes to get your QC team off the ground.
5. Yes but I do not want to pay more than the factory price.
   1. Over the years we have such a database built of the suppliers it would take you some time to delveolpe the same, these suppliers do not export directly they are sub-contractors used by factories, factories who do not see the need to start their own metal shop or foundry etc. You will be surprised at the price you will pay.
   2. With the price of our products, you will have the added layers of experience and technical staff on hand taking care that the products you have ordered do not come back once they are sold.
   3. We are a western owned company and understand the importance of not only the quality products, but the communication chain is updated and responded consistently and timely
   4. We have buyers that buy direct from factories (usually western owned) and from ourselves as our prices compete very favourably with many factories.