This year, the Ho Chi Minh City Expo, an annual international fair for woodwork and handicrafts, is a landmark which provides a review on the10-year path the Expo has helped local exporters in the industry find theirway to the international marketplace
The list of the 20 woodwork and handicraft exporters that are eulogized during the HCMC Expo’s 10th anniversary this year embraces both veteran players in the field, such as Duc Thanh Wood Processing Joint Stock Company and Savimex, and newcomers like Anh Tan Cuong (ATC). Despite a difference in corporate histories, the commendable companies have several things in common, including their attachment to the Expo’s development, active roles in finding new markets and contribution to the nation’s economic growth in the broad sense.
The first fairs
Le Hai Lieu, general director of Duc Thanh, recalls how the idea of hosting an international fair for the sake of trade promotion in HCM City in early 2000 received strong support from the municipal authorities. The concept was ardently adopted by both the city government and the then Department of Trade, now the Department of Industry and Trade.
As e-commerce had yet to take root at that time, businesses in the field were compelled to spend enormously on bringing their products to overseas fairs in hope of seeking new customers. Lieu, then vice president of the Handicraft and Wood Industry Association of HCM City (HAWA), an organization grouping together players in the city, contended that local exporters ought to actively attract international clients in a fair at home. Given the industry’s export sales amounting to hundreds of millions of U.S. dollars a year, such an event would be highly feasible while helping exporters cut costs.
Authorities’ backing aside, the proposal rapidly fascinated companies across the board. The Department of Trade was then tasked with orchestrating the first event alongside with HAWA. Ever since, in addition to being offered fees much lower than those of similar fairs abroad, participants in HCMC Expo have enjoyed other incentives, for instance the online fair featured at www.hcmcexpo.com.vn. HCMC Expo has become a companion of companies in the industry.
The promotion of the Expo has been carried out through the channels of Vietnamese commercial attachés in countries worldwide, plus those of foreign companies and organizations currently operational in HCM City. In 2003, amidst the Severe Acute Respiratory Syndrome (SARS) and the war in Iraq, the Expo witnessed contracts signed worth US$235 million. Subsequently, the number of exhibitors soared from 126 to 600. All the figures are testimony to the high hopes participants have pinned on the event.
To the newcomers, HCMC Expo offers as well both opportunities and leverage on the development path. In May 2006, ATC was founded, hinging on its furniture made from rattan and dried water hyacinth. ATC Director Nguyen Hoang Tan says since its birth, the company has targeted export markets. Therefore, ATC registered for two booths at the Expo in its first year of operation. Three years later, ATC won a considerable number of contracts at the Expo. “Last year, in Expo 2009, when the global economy was still in tatters, ATC managed to sign on the spot contracts worth more than US$100,000 with customers from the U.S., Britain and Spain,” says Tan. Sales of ATC’s rattan and hyacinth furniture at the Expo, according to Tan, have grown by 15% annually.
Tan recalls an exciting story about one of his customers in last year’s Expo. “That was an American I first thought to be only a visitor,” he says. However, after scrutinizing ATC products on display, the American guest asked for a full quotation and ordered a batch of 80 sets worth US$50,000. In fact, the man was an importer from Miami on a short trip to HCM City. He has entered the list of ATC regular customers.
Participants say this year’s Expo is witnessing the return of many customers. Tan hopes the number of new orders will rise by 20% over last year’s. However, exhibitors still complain about the limited space allocated at the fair. Each company is entitled to only six booths, equivalent to 60 square meters, at most. This area is way too low for sizable woodwork manufacturers that require larger space so that they can arrange their products to optimally attract potential customers.
An exhibition center of scale in need
Not long ago, an exhibition organizer sent an invitation to Duc Thanh, asking the company to join a fair highlighting Vietnam’s potential in the woodwork industry to be held in Hong Kong. One of the reasons for choosing Hong Kong as the venue for the event is that Vietnam has yet to accommodate an exhibition center attaining international standards, which is able to meet meticulous demands of prestigious exhibitors.
The HCMC Expo is part of the national program of trade promotion. However, in that program, no projects to build exhibition centers of international caliber have been conceived.
Because of infrastructure still under par, foreign participants in HCMC Expo remain mostly representative offices or organizations currently present in Vietnam. Although the number of overseas exhibitors has been on the increase, it remains modest as the scale of the event has yet to meet international companies’ expectations.
Lieu contends that the limitation has, to a certain extent, failed to fully exploit the potential of local trade and, beyond that, has partly dented effort to promote the prestige of Vietnam’s woodwork and handicraft.
Meanwhile, experts in the field argue that some local exporters have been professional in promoting themselves as they have gained extensive experience after years of engaging in prestigious international fairs, such as those in Singapore, Germany, the United States and China.
An official with the HCM City Department of Industry and Trade says that a proposal was made several years ago to build an international exhibition center on an area of 100 hectares. However, for various reasons, that scheme has been shelved.
Businesses in the industry say that now is a good time for the Expo’s organizers to ponder on its future so that it will be representative of not only the woodwork and handicraft exports but also Vietnam’s spearhead industries. To turn that goal into a reality, the Government should provide more support in building infrastructure of the right scale to push forward the task of export promotion.
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