Furniture Manufacturing in Vietnam: Full guide

This guide will give you a complete introduction to the furniture industry in Vietnam. Everything you need to know before sourcing furniture from there.

Executive Summary

For full details, please refer to below guide. Some of the key points to remember:

• Vietnam’s export furniture industry is one of the fastest growing in the world. It is already the 2nd largest Asian exporter of furniture and presents huge potential for buyers.
• Main products you can source:
  - Wooden indoor furniture
  - Wicker outdoor furniture
  - Upholstery
• Materials used:
  - Local wood: Acacia and rubber
  - Imported wood: Walnut, oak, ash and poplar, pine
  - Other: rattan, poly-rattan, water hyacinth, seagrass, and bamboo
  - Metal frames
• Where can you find suppliers:
  - Wooden indoor furniture: Ho Chi Minh City and its surroundings (Binh Duong and Dong Nai)
  - Outdoor furniture: Central region (Binh Dinh and Quang Nam) and Ho Chi Minh and its surroundings.
• Best tradeshow:
  - VIFA furniture fair (once a year in March)
  - Best sourcing websites:
  - Vietnam Reach + Alibaba

Introduction:

After reading this guide you will have a better understanding of:

• Categories of furniture you can source from Vietnam
• Type of woods used
• Main locations of furniture suppliers
• The best tradeshows and sourcing websites
• MOQ
• Average furniture factory size in Vietnam

Vietnam’s furniture industry has changed in the past 20 years, transitioning from a semi-handicraft industry targeted at the local market to one the largest furniture exporters in the world. Vietnam exported only USD $1 billion worth of furniture in 2004, the latest figures show a tenfold increase, with over USD $10 billion exported in 2019. Numbers speak for themselves.

In 2021, Vietnam was the 2nd largest exporter of furniture in the Asia-Pacific, after China, and the 5th largest worldwide. Vietnam is a key player in the global furniture industry and is an ever more attractive alternative to China for foreign companies looking to source furniture. Vietnam overtook China in 2020 in furniture exports to the US. For the first time in a given major product category, Vietnam exported more than China to the US (USD $7.40 billion vs USD $7.33 billion).

While relatively new compared to China, the industry is already well established with a network of over 2,300 companies involved in the export of furniture, timber and wooden products. Interestingly, and unlike China, around 40% of the furniture factories exporting products are foreign-owned and managed. The Vietnamese furniture industry is much less reliant on China for parts and materials compared to other export-oriented industries. It imports its timber from numerous countries, not only China (cf the part about imported woods later in this guide). This also means that furniture production remained stable in Vietnam during the 1st wave of the Covid-19 pandemic.

Furniture Manufactured in Vietnam

Vietnam’s furniture industry is already well established, with a vast network of factories. It is not the new player it was 20 years ago, largely focused on outdoor furniture at that time. As such, the range of furniture products (especially wooden ones) you can source from Vietnam is virtually limitless:

· Indoor furniture:

Buyers can now source and manufacture almost any type of wooden indoor furniture in Vietnam. From dining chairs and bedroom sets to living room tables, kitchen cabinets and more. Among furniture categories, indoor furniture was the fastest-growing segment in the past few years. This was stimulated by FDI investment, the use of local woods, and growing demands from international buyers trying to find alternatives to China.
Wood and engineered wood is the material predominantly used by indoor furniture factories in Vietnam. As such, you will have no problem finding manufacturers highly experienced with Plywood, MDF, and laminates like veneers and particle board but also solid wood and softwood. The possibilities and large spectrum of factories (from cost-focused factories only manufacturing engineered wood to high-end manufacturers specialised in solid wood) make Vietnam attractive for wooden indoor furniture importers.

· Outdoor furniture:

Outdoor furniture manufacturers predominantly use wicker, rattan, water hyacinth and bamboo, as these materials are historically and naturally present in Vietnam. We also see more and more outdoor furniture factories familiar with light cement and teak wood.
The outdoor furniture industry is well established, until a few years ago it used to be the biggest category of furniture export for Vietnam (since overtaken by indoor furniture). Its centre, in Binh Dinh province (central Vietnam), mostly consist of experienced local Vietnamese manufacturers. Unlike other categories, you will find fewer FDI-owned outdoor furniture factories.

· Upholstered furniture:

The sector produces all kinds of sofas, using an array of imported upholstery, including linen, velvet, leather, acetate, chenille fabric, and cotton.

· Office furniture and public buildings furniture

This sector is less developed than other furniture categories in Vietnam, however, you will still be able to find factories for office chairs and tables, for example.

On the other hand, it will be harder to source a Vietnamese manufacturer for:

• Reproduction style and ornamentation furniture. India and Indonesia can be better alternatives with more production options.
• Metal frame furniture used for office or restaurant furniture.

This is as the manufacturing process is usually very capital intensive and requires large MOQs. China remains the leader in this product category (OEC world).

• Some popular wood that is available in Europe and the US: Maple, cherry, and spruce.
  They do not grow in Vietnam and need to be imported. In the next section of the article, we describe the types of tropical wood commonly used in Vietnam and wood generally imported

Type of Wood Used

Local materials

Vietnam’s forest represents 44% of its land area (source: European Union Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan), of which 1% is primary forest, 74% are secondary forests, and 25% are plantations. Annually, plantations provide roughly 28 million cubic meters of wood materials for the wood processing industry. Among those, rubberwood and acacia are the two main domestic wood species used to manufacture furniture for export in Vietnam:

· Acacia,

Also known as mimosa or wattles. It grows in hot and humid climates like Vietnam. It is known to grow rapidly and reach six to nine meters within five years, making it a sustainable wood source. Its durability and hardness also make it resilient. It always reaches above 1,000 on the Janka scale (between 1,100 and 2,500 in pound force depending on the species), higher than popular species like maple or European oak. Acacia is known to be an extremely durable wood.
Acacia wood is also popular for its look, which is naturally smooth with unique grain patterns. Its vast colour options are another advantage, from light to deep brown depending on the acacia species. Acacias plantations species grown in Vietnam include Acacia mangium, Acacia auriculiformis and a hybrid of both.

· Rubberwood,

Also known as Pará rubber tree or Hevea brasiliensis. Originally native to the Amazon, rubber trees now grow all around the globe and Southeast Asia specifically. The Vietnamese rubber tree is mostly harvested in southern provinces (71% of the country’s production). Rubber is collected from the trees and its medium-density tropical hardwood is logged at the end of the rubber production lifecycle. By definition, rubber wood is a by-product, making it cheaper and more environmentally sustainable than many other types of wood. It is an ideal material for furniture, durable (960 in pound force on the Janka scale), very stable (low warping and shrinkage), easy to nail and engrave. It is also easy to stain and can cater to your manufacturing requirements.

Weaving

Weaving is one of the specialties of the Vietnamese furniture industry, especially outdoor products. Wicker and woven products are engrained in Vietnam’s handicraft history, with skills passed from one generation to another and the products are still handmade. The following local materials are often used for wicker furniture in Vietnam:

• Rattan
• Seagrass
• Water hyacinth
• Synthetic rattan (aka Poly rattan or resin wicker)

Bamboo

Bamboo is also fairly common for furniture making in Vietnam. Bamboo is technically a grass as it grows back after being cut, making it one of the most sustainable materials to work with. Despite being a grass, it is incredibly sturdy and bamboo furniture can easily compete with wooden furniture while being more versatile and lighter. Because of its specificities, we recommend choosing a factory that has lots of experience with this material.

Imported materials options

Local wood production only supplies around 30% of the quantities required by the Vietnamese furniture industry. Local wood production cannot keep up with the growing demands. For instance, the domestic production of rubberwood and acacia is limited to 2 million cubic metres per year, but about 5.5 million cubic metres of wood are imported every year. The Vietnamese export furniture industry imported a more than US$2.2 billion worth of wood materials in 2019; this included US$928 million worth of timber and US$650 million worth of wood panels.

Vietnam imported wood from t over 80 countries in 2020, including the US, China, the EU, Thailand, and Chile. In 2019, Vietnam was the third largest export destination for US hardwood.

Origin of some imported also woods raised concerns in the past few years. An estimated 30% timber imports (mostly exotic wood) are imported from “high risk” countries (Laos, Cambodia and PNG among other) according to and as defined by the report from Forest Trends on Vietnam’s Import of Tropical Timber. The recent signature of the Vietnam-EU Voluntary Partnership Agreement also addressed this issue, aiming to tackle illegal logging and regulate timber imports in Vietnam. These regulations and new awareness are necessary and positive on the long term for the image of the industry.

If you have a particular wood in mind, inform the supplier at the very beginning. You will have no problem finding factories familiar with manufacturing processing:

• Walnut
• Oak
• Ash
• Poplar
• Pine
• Teak

Where are Furniture Suppliers Located?

Below are the three main areas for furniture manufacturing in Vietnam. The Ministry of Agriculture and Rural Development (MARD) reported that over 80% of the exported furniture originated from only nine of the country’s 58 provinces. Our own experience corresponds with this data.

Map of Key Wood-Working Provinces in Vietnam.

Source: https://evbn.org/, Research report “Vietnam’s Furniture and Home Décor”

We have divided these clusters in three main areas for more clarity, by order of importance:

· Southern Vietnam:

Ho Chi Minh City and its surrounding provinces, including Dong Nai, Binh Duong, Long An, and Tay Ninh.

This cluster predominantly manufactures wooden indoor furniture, upholstered furniture, and outdoor furniture on a smaller scale.

Binh Duong is worth highlighting. According to MARD, this province alone accounted for 47.3% the total value of wood products exported by Vietnam in 2020. The Binh Duong Furniture Association reported 600 local and FDI companies involved in the furniture and wood industry in the province.

· Central Vietnam:

Binh Dinh and Quang Nam provinces.

Factories are largely in industrial parks in the vicinity of Da Nang (Binh Dinh) and Quy Nhon (Quang Nam).

Those clusters were historically known for the manufacturing of outdoor products such as garden sets, and they often use weaving techniques with rattan or poly rattan. While products have become more diverse, this region is still the epicentre for the manufacturing of outdoor furniture of Viet Nam. Wooden indoor furniture factories are becoming more prevalent and Binh Dinh alone has over 110 wooden furniture export oriented manufacturers according to its Forest Product Association.

· Northern Vietnam

Hanoi and its surrounding provinces of Bac Ninh and Phu To.

This cluster benefits from its proximity to China, enabling it to easily import imports timber and hardware from there. The furniture industry size is much smaller compared to the South and Central clusters, the north expertise rather lies in heavy, electronics and electrical industries. It is worth noting that metal framed, and steel furniture is one of the specialties of this region, thanks to the presence of heavy industry in the region and the convenient access to Chinese metal suppliers.

How Can You Find Furniture Manufacturers in Vietnam?

Now that you know more about the Vietnamese furniture industry, the type of woods they use and the location of factories, the question of where you can find, and contact export furniture factories based in Vietnam remains.

While there are several ways to go about this, we would recommend tradeshows or sourcing websites like Vietnam Reach or Alibaba. With these tips, we are confident you will have no problem sourcing furniture from Vietnam on your own!

1. Tradeshows

International trade fairs are a developing and growing stage in Vietnam. Do not expect the same scale as those in China. From our experience, one or two days will be enough to visit them, and the rest of your business trip can be maximised by visiting potential suppliers. While the shows may be smaller, there are fewer competitors and international buyers. This could give you an edge over your competitors back home who are still solely attending shows in China or Hong Kong. Below is the list of the biggest export-oriented shows, we have visited each of them (all numbers are from 2019, pre-Covid times).

VIFA — Vietnam International Furniture & Home Accessories

It is the largest export-oriented show in Vietnam for wooden furniture and furniture in general. It is one of the only exclusive export-oriented tradeshows for the industry and probably the most important.

• 519 Exhibitors, 36,500 sq m, 4,970 foreign visitors.
• Every year in March.
• Ho Chi Minh City.

Lifestyle Vietnam — The Vietnam International Home Décor and Gift Fair

Just VIFA, Lifestyle Vietnam is export-oriented and targets international buyers. Although primarily targeted at home decorations, handicrafts and garden accessories, the show also has a decent section dedicated to indoor and outdoor furniture. According to the 2019 list of exhibitors, 20% were indoor and outdoor furniture manufacturers (≈120 exhibitors).

• Around 600 exhibitors, 1,823 foreign visitors (20% increase year on year).
• Every year in April.
• Ho Chi Minh City.

Be aware that if you are looking to export finished products from Vietnam, some tradeshows are NOT for you. They are targeted at Vietnamese furniture manufacturers, showcasing raw wood suppliers, machinery, and tools and technology used by the industry. If you want to source finished products, these shows will NOT be relevant to you:

• Vietnamwood (aka Vietnam International Woodworking Industry Fair).
• BIFA Wood (aka Binh Duong Wood & Woodworking Machinery exhibition).
• VIFA Woodmac Vietnam.
• Vifa Home (this show includes finished products, however, it is solely targeted at the local market)

2. Local Furniture Associations

The following local associations are also worth mentioning. However, answers can be pretty slow:

• HAWA — Handicraft and Wood Industry Association

Established in 1991, the association today has 400 members, mostly based in HCM and the surrounding provinces of Binh Duong and Dong Nai. The majority (51%) of its members work in the wooden furniture industry (both indoor and outdoor),

• BIFA — Binh Duong Furniture Association

Binh Duong province already account for around 50% of Vietnam’s wood export in 2020.

• FPA Binh Dinh — Forest Products Association Of Binh Dinh

Binh ding province is one of the biggest cluster for outdoor furniture.

• VIFORES — Vietnam Timber & Forest Products Association

1,000 members from all around the country

• DOWA — Dong Nai Wood and Handicraft Association

3. Sourcing Platforms and B2B Marketplace

Sourcing platforms are the easiest way to get in touch with Vietnamese furniture manufacturers.

· Alibaba

Founded in 1997, Alibaba is a renowned B2B marketplace. It is based in China and many of the Vietnamese suppliers on its website are Chinese-owned FDI factories.

· Vietnam Reach

One of the largest B2B sourcing platform solely focusing on Vietnam. This website put you in touch with factories in Vietnam, display their products and allow you to directly contact factories.

This platform can provide you some of the most up-to-date and complete database of local furniture factories.

Their directory of furniture manufacturers is here. Categories include:

• Indoor, Home furniture.
• Outdoor furniture.
• Office furniture.
• Public space furniture (hotel, restaurants, hospital, school, etc).

Average MOQ and Factory Size

1. MOQ (Minimum Order Quantity)

MOQs are crucial for factories, especially in the furniture industry. It allows them to minimize costs by buying larger quantities of raw materials, adjusting machinery less often, and creating more permanent production lines. The Vietnam export furniture industry is now a USD $10 billion industry, requiring standardization and massive production lines. MOQ requirements are one of the consequences of this industrialization.

Based on our experience, the MOQ requirements of the Vietnamese furniture industry are usually similar to those in China. There is no general rule, however, the smallest MOQ you can expect from a medium-size furniture manufacturer in Vietnam (less than 500 workers) for ODM is as follow:

• Wooden furniture such as dining chairs: 50 to 100 pieces.
• Wooden furniture such as tables or bed frames: 20 to 50 units.
• Wicker furniture such outdoor sofa sets: 20-foot container.

We also noticed that Japanese- and Korean-owned factories tend to accept lower MOQs. Asking about the permanent stock of the manufacturer can also be a great way to lower the MOQ.

2. Factory Size

By definition, the term “furniture industry” is a broad term. Describing the average sizes of manufacturers means dividing the industry into categories. You may note there is no precise data about the average number of workers and the size of factories in Vietnam. The data in this article is based on our experience (after having visited +150 furniture factories in Vietnam) and on the size per single location (some manufacturers have several factories):

• Indoor furniture

Diverse sizes. Number of workers: 50 to +1000.

• Outdoor furniture

They average 50 and 200 workers. Some large outdoor furniture factories have more than +1000 workers (Scansia Pacific or Kaiser furniture).

• Upholstered furniture:

Generally, very big, with 200 to +1000 workers. Several large factories work with upholstered furniture (Manwah’ or Woodworth to name a few).

Conclusion

We hope that this guide on the furniture industry in Vietnam was helpful. You should now have all the tools to start finding furniture manufacturers in Vietnam!