Summary of Ranking Results of Vietnam's Import Market of Traditional Goods

cultural characteristics have many similarities with Vietnamese culture.

The following are market forecasts and analysis for some key export markets d5 indicated above:

Japan market:

In the past 10 years, Japan has always been a major import market.

Vietnam is the leading country for handicraft products, annually importing about 13 billion USD of handicraft products from other countries, while Vietnam's handicraft exports to Japan in 2005 accounted for 1.7% of this 24 . However, it is forecasted that Japan will increasingly occupy an important position in Vietnam's handicraft exports and this can be explained by the following factors:

Japan is the second largest economy in the world, one of the largest import markets in the world. Japanese people especially love to use traditional handicrafts and Vietnam is one of the favorite destinations. The geographical locations of the two countries are relatively close to each other. The Japanese economy is on the path of steady recovery after a long period of recession, the strong appreciation of the Yen will be favorable for Vietnamese goods exported to this market in the near future.

Japanese and Vietnamese cultures have many similarities: they both suffer from

Influenced by Confucianism, Buddhism, ancestor worship, and musical culture

chopstick culture... Since ancient times, there has been trade and cultural exchange between the two countries through the trading port of Hoi An. Japanese and Vietnamese people are very close and sociable, the wave of Japanese tourists to Vietnam is increasing rapidly.

In the past 10 years, the relationship between the two governments has been very good. The Japanese government wants to seek cooperation from Vietnam to help Vietnam and create Japan's position in the region and the world. Therefore, the Japanese government provides the most ODA capital to Vietnam, encourages and sponsors Japanese companies to do business and invest in Vietnam, and encourages and creates conditions for Japanese citizens to travel to Vietnam.

24 Source: Ministry of Trade, 2006 - Export development project for the period 2006-2010 [4]

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In business, Japanese enterprises are characterized by being extremely cautious and need to spend a lot of time getting to know each other before reaching a contract, but once the first contract is signed, the business relationship will continue to be maintained very stably and long-term because Japanese enterprises/customers are very loyal (to their partners). This explains the stability in the export turnover of Vietnamese handicrafts to Japan in recent years.

Among the top 5 groups of handicraft products exported from Vietnam, there are 4 groups in which the Japanese market occupies the leading position (embroidery, fine art wooden products, rattan and bamboo weaving and weaving).

Exporting wooden furniture to Japan has not encountered increasingly strict regulations like those in the European Union (EU) and the US on forest protection (some EU countries do not accept to buy products made from Cambodian wood). The Japanese have a fairly large demand for wooden furniture (the annual consumption of furniture reaches 10.4 billion USD). Currently, Vietnam is the country with the fastest export speed of wooden furniture to this market 25 . It is noteworthy that the amount of wooden furniture produced by Japan

is on a downward trend due to high labor costs causing many businesses to

furniture shifted to cheaper imports. The Japanese also

are shifting from Western wooden furniture to mid-range European products . Although fine art wooden furniture only accounts for a portion of the total furniture exported to Japan, this is still a great opportunity for Vietnamese fine art wooden furniture manufacturers and traders.

In addition, many other types of Vietnamese TCMN products are also available.

popular in the Japanese market such as: lace embroidery, wool carpets and small handmade carpets, bamboo and rattan furniture... One item that the Japanese market has a large demand for is ceramics, but our ceramic market share is

That is still very small, not commensurate with the market potential and supply capacity of Vietnam - this is a product that needs to promote marketing and promotion to successfully penetrate the Japanese market.

25 According to Japan External Trade Organization JETRO

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To promote the export of these goods to the Japanese market, businesses need to be provided with market information, and must have appropriate sales methods and channels. In fact, most successful companies in the Japanese market sell products through their branches in Japan right from the start; or work with partners through trading companies that have relationships with the Japanese import market, or contact large stores in Japan (because they actively import goods directly from abroad); participate in introducing products suitable for Japanese tastes at the "Vietnam Square" center in Osaka, or participate in support programs of the Representative Office of the Japan External Trade Organization (JETRO) in Hanoi (fairs, exhibitions introducing products held in Japan annually or irregularly). Another special feature of doing business with Japan is that Japanese people are very poor at foreign languages ​​(English) and they really like to work with people or businesses that can communicate in Japanese (especially those who have studied in Japan for many years). This is also a factor that Vietnamese businesses need to consider in their strategy to penetrate the Japanese market.

Vietnamese businesses wishing to penetrate the Japanese market need to pay attention to the following characteristics:

The Japanese market is a very diverse market due to many factors such as 4 seasons, age, region, etc. Businesses need to be aware of

The principle is: produce as close to market demand as possible, prepare many varieties so that even just one item is rich so that consumers can choose (For example: size, many functions, shapes, ...)

The market determines the price. Japanese consumers have the characteristic of buying even if it is expensive if they find it necessary. On the contrary, things that the market does not like cannot be sold even if they are cheap. The export price of a product is the price calculated at the time the product arrives at the Japanese port. Even if the price in Vietnam

Even if the price is cheap, if the shipping cost and tax are high, it will also increase the price of the product. Currently, China is a major trading partner of Japan, especially the products that Vietnam exports the most to Japan. Vietnamese enterprises need to understand that participating in the export market is a fierce competition with Chinese goods and ASEAN countries.

It is very important to ensure the deadline requested by the buyer. If the delivery is late and the delivery deadline is not guaranteed, the sale will be lost. This will make the buyer not place a second order.

It is not necessary for the goods to be of high quality. The important thing is that the quality of the goods must be stable. It is not necessary to focus on new equipment. Avoid products with quality that exceeds unnecessary requirements. Products with quality that exceeds the requirements of users will make the price higher and consumers will no longer want to buy them. Enterprises that want to export agricultural products need to apply for the JAS quality certification mark, enterprises that export industrial products need to have the JIS certificate, both of which are issued by the Ministry of Economy, Trade and Industry of Japan (METI). Goods with the above certifications will be easier to consume in Japan because consumers in this country have great confidence in the JAS and JIS quality certificates.

Based on export statistics of the group of 5 handicraft products with the highest export value of Vietnam from 1998 to 2004, the annual growth rate in exports of this group of products, combined with interviews with experts from the Trade Promotion Agency, Ministry of Trade and JETRO (Japan Overseas Trade Promotion Agency), the author of the thesis forecasts the export value to the Japanese market of the group of 5 handicraft products with the highest export value of Vietnam in the period 2005 - 2010 in Table 3-4.

Table 3-4: Forecast of export value of 5 groups of handicraft products to Japan

Unit: million USD

Source: Thesis author, 2005

US Market:

The US market is very large and promising. Every year, the US imports about 13 billion USD worth of handicrafts from other countries, while handicrafts exports to the US in 2005 accounted for only 1.5% of this amount . 26 It is expected that in the near future, when the Permanent Normal Trade Relations (PNTR) with Vietnam is approved by the US Congress, this will be a great opportunity for Vietnamese handicrafts to strongly penetrate the huge US market.

The US is a country with a huge import demand for ceramic products and hardly produces this type of product. The US is also a large market for wooden products and other handicraft products such as rattan, mosaics, lacquer paintings, etc. However, as analyzed in Chapter II, businesses that export embroidery products need to research and find out why embroidery products have not penetrated this market (and some other important markets such as the EU), and at the same time pay attention to improving embroidery models to better meet the needs of US and EU customers. The US is also an unstable market and not easy for Vietnamese businesses to penetrate. In this market, lawsuits often occur, the government sets up tariff barriers (anti-dumping taxes, embargoes for human rights reasons, boycotts of goods using child labor or having environmental pollution factors, etc.).

26 Source: Ministry of Trade, 2006 - Export development project for the period 2006-2010 [4]

Unlike Japanese enterprises, American import enterprises are very pragmatic and willing to change customers, partners, and suppliers just for profit reasons. The long geographical distance, travel costs, marketing, participation in fairs, and expensive promotion in this market are also disadvantages for Vietnamese small and medium enterprises. Enterprises that successfully penetrate the US market are often overseas Vietnamese enterprises or have relatives in the US / working for American enterprises or have investment capital from American partners in their enterprises. Because it is a large market, orders from American enterprises are often very large and often exceed the supply capacity of

Most of Vietnam's private enterprises or small-scale businesses. To successfully and stably supply this market, there must be large-scale corporations or enterprises (or in a form of association such as core craft villages and satellite craft villages).

One of the ways to penetrate the US market is to participate in fairs and exhibitions. According to the assessment of some successful businesses in exporting handicrafts to the US, 70-80% of the business contracts of these businesses

signed through fairs and exhibitions. Every year in the US there are over

9,000 fairs and exhibitions. Most of these fairs and exhibitions are specialized in depth. Vietnamese exporters should pay attention to international and industry fairs held in major commercial centers such as New York, major cities in California, Miami, Dallas... or in industry capitals (for example, places with a tradition of wooden furniture are Northern California; seafood in California, Boston; textiles and garments in New York, Las Vegas...). The cost of participating in fairs in the US is quite high, just the rental fee for a 6-10 square meter booth is on average 2,000 USD/day, not including transportation costs; accommodation and travel expenses during the fair. To reduce costs, Vietnamese enterprises should cooperate to participate in fairs. The support of industry associations in researching and selecting fairs will help enterprises participate more effectively.