Overview report about Interior Furniture Market of Vietnam (2015-2020)

The economy is growing steadily and the middle class is growing fast so Vietnam’s furniture market is attracting many famous brands in the world. The furniture industry will have strong changes starting from the production shift from countries to Vietnam.

Furniture market: Attractive high-class export furniture segmentAt the end of July 2019,Guest Posting Dongsuh Furniture, a luxury furniture brand from South Korea, launched in Ho Chi Minh City. With the scale of two large factories located in Binh Duong with an area of more than 10,000 m2, Dongsuh Furniture boosts its production to export with living room furniture such as leather sofas, sofa tea tables, wooden TV shelves, and furniture. bedroom furniture such as wooden bed, modern dressing table, wooden wardrobe, dining room equipment such as dining table set, …

Mr. PARK YOUNGNAM – Managing Director in Vietnam of Dongsuh Furniture said: “After 5 years of exploring the Asian market, Dongsuh Furniture recognized the attractiveness of the Vietnamese market”. That is the reason for Dongsuh Furniture to come to Vietnam earlier than planned, after invading China and Japan. Vietnam is the third market in Asia, after China, where Dongsuh Furniture is present.

It is also the attraction of the market that made King Mattress – funded by Casper, a well-known American mattress supplier, decided to bring Amando high-end mattresses in Vietnam combined with Korean furniture Dongsuh Furniture to distribute. in Viet Nam. Currently negotiating for cooperation.

The furniture market attracts thousands of participating businesses, including the most exciting high-end segment with names such as Pho Xinh, Nha Vui, Index living mall, etc. foreign brands because of the opportunity from the domestic furniture market of Vietnam.

Real demand and purchasing power of furniture industry per capitaAccording to data of the Ho Chi Minh City Association of Fine Arts and Wood Processing (HAWA), only for furniture, the average consumption demand in Vietnam is 21 USD / person / year. Calculated, the scale of domestic wooden furniture consumption in 2018 reached US $ 4 billion.

According to Mr. Phan Dang Chuong – Deputy General Director of ERNST & Young Vietnam Limited, in the past 5 years, about 400,000 – 500,000 townhouses and high-class apartments have been born in Vietnam. On average, each apartment uses at least 1-2 hundred million dong for the interior, so there is less than 100,000 billion dong for this demand.

In addition to real estate, the strong growth of the furniture industry is also related to the formation of the middle class in Vietnam that has spread the aesthetics and demand of consumers. “Customers do not choose furniture as ordinary items but express their lifestyle, sophisticated aesthetic sense,” Mr. Phan Dang Chuong shared.

In 2018 Vietnam spent nearly 500 million USD to import furniture, which is expected to continue to increase in the following years.

According to the sharing of representative of Eric Dinh, marketing director of Dongsuh Furniture, middle and high-end products have many price segments ranging from tens of million to nearly 400 million dong / product. In particular, the purchasing power of the price segment below 50 million VND accounts for 40% of sales of this business. And at the same time affirmed, the current furniture market has not been properly evaluated in terms of product value, many products have been raised from 3 to 5 times.

“The opportunity to experience a complete interior space for every Vietnamese family is almost a luxury. It is a challenge but Dongsuh Furniture’s model of selling furniture online will completely change that. Buying goods online in Korea as a habit of the people, we believe that in Vietnam, we will do the same, especially before the explosion of IoT and e-commerce platforms in Vietnam. selling home furniture will help save significant costs and help all Vietnamese people have the opportunity to access the luxury furniture segment at an affordable cost “- Mr. Eric Dinh shared with reporters tablets.

Not only Dongsuh Furniture, other high-end brands distributed by Dongsuh Furniture also grow very high as the model of living furniture (sectional sofa) classroom furniture, office room with office chair samples.

With kitchen equipment, kitchen, Kohler, Rita Vo is one of the 10 largest distributors of this group. Mr. Vo Mau Quoc Trien – Chairman of the Board of Directors Rita Vo said that Vietnam is the third largest market in Asia, after India and China. Kohler products distributed by the company increase every year. Rita Vo currently has 7 stores (each store area is from 3,000 – 10,000m2) and will open more to reach 20 stores within the next 5 years.

Evaluating the market will continue to grow strongly, in the fourth quarter of this year, Dongsuh Furniture intends to open 3 more large-scale production factories and open two more stores in Ho Chi Minh City and Hanoi so customers can easier to position the brand and then gradually move to online.

In the plan to conquer Vietnamese consumers, in the next 5 years, this business will open 15-20 furniture stores in Vietnam. “We choose Vietnam as the center to explore the ASEAN market. When having a satisfactory partner, the development of the distribution system will be very fast, ”Mr. Park Young Nam affirmed.

What is the potential of Vietnam’s furniture market today?While leading the world in furniture export, Vietnam is still leaving many potentials of the domestic market open.

“Ignoring” the domestic furniture marketAccording to a report on the Vietnam furniture market made by Dongsuh Furniture, Vietnam ranks first in Southeast Asia, 2nd in Asia and 4th in the world in furniture export. In 2015 alone, in the European market, the total export turnover of furniture reached US $ 7.2 billion and US $ 1.7 billion with home decor items.

The development of the furniture industry in Vietnam is expected to grow steadily at a rate of 9.4% per year.

Also according to Dongsuh Furniture’s analysis, the current Vietnamese furniture market is mainly export-oriented and leaving the yard open. Most of the domestic market is a playground for imported goods, originating mainly from China, Malaysia and Thailand.

Domestic consumption of wooden products remains weakA recent report on Vietnam’s wood product market by the Ministry of Agriculture and Rural Development also pointed out that. Although ranked 6th in the world in exporting wood products, the domestic market with the consumption of 90 million people, estimated at 1-2 billion USD a year has not been paid enough attention.

Partly due to the incorrect pricing of products in the domestic furniture market, as originally shared by Eric Dinh. Causing many families as well as consumers to wonder before going down, although in general, the quality of furniture in Vietnam is quite good.

Statistics show that Vietnam’s domestic wooden furniture market only accounts for about one third of export turnover

With an average GDP growth rate of 6% per year, along with the development of construction and real estate sectors, the increase in household income will also help increase spending on goods and services. Interior.

The Ho Chi Minh City Fine Arts and Processing Association estimates that in 2018, the total domestic furniture consumption is estimated at about US $ 4 billion.

In the context that domestic companies are focusing on exporting, Dongsuh Furniture said that the furniture market in Vietnam is similar to South Korea 20 years ago, but this will be the first step for attracting foreign investor. Many international brands are planning to set up manufacturing plants, or seek opportunities to expand business in Vietnam when the tariff barriers on furniture and home decor are removed.

Enhance interior shopping experience to attract customersAccording to the study, Vietnamese consumers tend to change their home decoration quite often. Customers aged 25-35 years rearrange their furniture within 6 to 12 months. This group is especially interested in modern and convenient shopping experiences.

Therefore, many companies in Vietnam have participated in the race of e-commerce and technology applications to improve shopping efficiency of customers.

A pioneer in the field of online furniture, Dongsuh Furniture brings a whole new shopping experience with diverse furniture products, fashionable and elegant colors, along with the promotion of focusing on design as well as description of details. verbatim honesty, making furniture shopping easier. Looking is mesmerizing, touching is coffee.

Smart interior market, the race is gradually heating upWith the 4.0 industrial revolution has come, along with many other fields, the interior sector is also heating up with the smart product race.

Developed with the need to buy furniture onlineSocio-economic life is increasingly improving, people’s needs are also increasing. In the field of real estate, the current demand is not only a house to live in, but also a place to enjoy life, to rest and relax.

Along with the development of science and technology, especially the industrial network 4.0, artificial intelligence (AI), connectivity of things (IoT) …, is increasingly being applied in many fields and industries. different, bring convenience, increase labor productivity.

The price of furniture increased but it also led to the demand as well as the rigor in each customer’s request.

See also: Price list of interior design of new houses 2020

Along with the general trend, a number of furniture manufacturing and trading businesses have also researched and produced many smart products and these products were quickly accepted and favored by consumers.

Many interior products are compact, multifunctional, suitable for many types of apartments and rooms. Meanwhile, restrictions on small area or tight space will no longer be noticed. In addition to being compact with multiple uses, the colors of these products are also very diverse, consistent with the diverse needs of consumers.

In addition, this product was not previously popular due to the habits and culture of Vietnamese consumers. Because it is a new product, Vietnamese consumers do not believe in product safety. Therefore, the market for smart furniture products does not develop for a long time in Vietnam.

However, in recent years, this furniture line has created a new consumer trend because of culture and consumer understanding are different from the past. In addition, consumer finance is also better, helping this product line to have more and more foothold in the market.

The trend of integrating digital technology into interior designEach year, the interior decoration market has its own changes and changes to ensure that it always meets the needs and tastes of consumers. This year, the trend is to integrate digital technology into interior design.

Interior “Modern – comfortable” customer priorityExperts in the market research and interior decoration industry said that in the past 2 years, the customer segment using high-class interior products tends to favor but modern and convenient designs. Comfort as well as the use and coordination of neutral colors create elegance and closeness to nature.

According to industry insiders, “modernity – comfort” are the two factors that are given top priority in making decisions on interior design choices. The attraction of these two factors can be clearly seen through consumer behavior towards the product.

Furniture collections catch the new trendAccording to the statistics of Dongsuh Furniture – one of the leading Korean furniture distribution businesses in Vietnam, consumers are now making moves as well as extremely positive expressions for decorative items. Interior style but with a bit of European style in general, especially Scandinavian Nordic furniture in particular.

The integrated functions are the major plus points such as the Dongsuh Furniture brand has used leather sofas with integrated USB charging plug or magazine compartment, etc. for relaxing sofa models.

Regarding colors, the neutral colors such as natural wood color, gray, brown, white …. Not only helps dislodge the elegance, warmth but also cleverly creates striking contrasting shades of personality that show the unique personal impression of the owner.

Especially, this is also a color that expresses elegance, nobility but no less modern, sophisticated in accordance with the active life today.

The race against the modern interior market

Mr. Eric Dinh said that consumers now have a high demand for smart and modern furniture. However, because the environment of the house has different spatial designs, while the Company only offers mass products, which are general in shape, not “tailor-made” for each apartment, it does not meet all requirements. be in demand.

“The smart furniture market in Ho Chi Minh City is developing quite bustling. Currently, there are many competitors in this market”, said Eric Dinh.

Typically, the newly launched LED bed of Dongsuh Furniture has been warmly welcomed.

Worries about Chinese goods “disguised” as furniture for exportAccording to Mr. Huynh Van Hanh – Vice President of Hawa, US-China trade tensions are now very easy to turn Vietnam into a “backyard” of Chinese wooden products, if Vietnamese enterprises do not build a retail system. will definitely lose at home. Once exports to the United States are declining, China must find markets to consume Chinese wooden products and furniture that will land in regional countries, including Vietnam.

Meanwhile, according to Mr. Eric Dinh – marketing director of Dongsuh Furniture, in order to protect the domestic wooden furniture market as well as export, the customs sector must closely monitor Chinese wood products into Vietnam in what form, which

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