Vietnamese consumer goods are expected to find ways to make it to the US market as trade between the two countries increases.
In a seminar about boosting exports to the US in HCM City on Tuesday, Erik Frankel, CEO of Vietsway, an online platform selling Vietnamese products in the US, said many countries, including Việt Nam, identified the US as the main export market.
Vietnamese exports increased constantly in recent years with a focus on smartphones, electronic components, textiles and footwear and furniture, in which foreign-invested enterprises are leading production.
Meanwhile, products manufactured by Vietnamese companies have barely scratched the surface of the market, according to Frankel.
The US is a hard-to-please market and has stringent standards for imported goods but also a market with diverse demand from high-tech products to affordable consumers goods, which are strengths of Vietnamese businesses.
While electronic products are dominated by multinational brands and corporations, opportunities are huge for Vietnamese enterprises in the field of consumer goods and handmade products, according to Frankel.
Vietnamese consumer goods sold in the US market would have a very high profit margin due to low raw material and labour costs, he said but recommended that businesses should carefully study customer tastes, price factor and competitive ability to choose direct or indirect exports.
"Factors that impact export results are delivery time, relationship with the distributors and marketing strategy," Frankel said.
Oanh Kimberly, director of forwarding operations at Indo-Trans Logistic Corporation, pointed out most of Vietnamese consumer goods producers are micro and small-sized enterprises with limited technology and market information, affecting their competitiveness in product quality and design.
Meanwhile, the application process for imported products into the US is complicated, requiring many different procedures and certifications that hamper exports of small companies.
“The cost of warehouse services in the US is very expensive, so before exporting, Vietnamese businesses need to understand requirements for import customs, complete documents, shipping method and specify liability of each party to avoid additional costs,” Oanh said.
The US has also a strict policy of origin fraud and trade evasion, so Vietnamese businesses need to be cautious and transparent with traceability information as well as accurately classify their goods when exporting to the US, according to the director.
Cao Thị Phi Vân, deputy director of the HCM City’s Investment & Trade Promotion Centre (ITPC), said the United States was a huge market with diverse demand for goods that Vietnamese enterprise could explore to increase exports.
The US is currently the largest export market of Việt Nam while Việt Nam has become the 13th biggest supplier of goods to the US.
Ending January 2020, exports to the US topped US$4.8 billion, down 7.6 per cent on-year, while imports from this market rose 5.4 per cent to $1.2 billion.
Vân said besides seeking new markets in 2020, ITPC would continue promoting activities to introduce Vietnamese products to the US.