Fine arts and handicrafts sought after in the US market

Le Xuan Duong, Director of the Export Support Centre of the Trade Promotion Department under the Ministry of Industry and Trade says that a sharp reduction in consumption in the US was due to consumers weighing up the pros and cons before buying product.

US consumers now prefer to buy essential goods at a reasonable price rather than high-quality products bearing renowned trademarks that are more expensive.

According to statistics, over the past four months, the US top-end clothing company Gafs, has seen a sharp fall in turnover from a year earlier while the turnover of Wallmart- a retailer specializing in popular products at average prices has increased.

Therefore, businesses should boost their exports of medium priced products rather than focus on high-class products.

The American Market Department under the Ministry of Industry and Trade reports that the products Vietnamese businesses need to export in large amounts to the US market at the time being, are agro-forestry-aquatic garment and textile and fine arts and handicraft products. American habits are changing with more and more consumers preferring to have fine arts and handicraft products in their homes.

In fact, Vietnam’s turnover of fine arts and handicraft exports to the US market in 2007 posted a relatively high increase of 35 percent over 2006, reaching nearly US$1.3 billion, particularly for interior wooden products.

Over the first months of this year, US imports of Vietnamese agricultural products has also increased. However, to boost the export of these products, businesses should strictly stick to US standards for food hygiene and safety.

Nguyen Van Tan, director of the Thong Tan Trade and Food Processing Company, which exports vegetables and fruit to the US, says that US partners not only care much about the quality of products but also about the packing and origin of products.

The value of the US dollar is currently lower than other strong currencies, causing difficulties for Vietnamese exporters. To minimize this, domestic exporters should negotiate with their partners to use other strong foreign currencies. Businesses that have signed contracts to pay in US dollars can negotiate with their partners to share the risks and should not change prices to maintain their prestige.

Vu Kim Oanh, director of the Song Vu bamboo export-import company says that when her company signed contracts with their US partners the exchange rate between the US dollar and the Vietnamese dong was 1/16,050, but when they exported their products the exchange rate has dropped to 1/15,900. However, the company had to keep its prices unchanged, despite losing profit.

The rapid changes in the US economy have led to a change in consumption trends. Therefore, economic experts have advised that domestic exporters should closely follow the situation on the US market and work with Vietnamese agencies in the US to get the latest information and make appropriate decisions in time.

Joaquin Monserrate, economic officer at the US embassy in Hanoi said crude oil is the key Vietnamese export product to the US, followed by agricultural and forestry products. To boost exports Government agencies overseas are important contacts for businesses. For example, when US companies want to invest in Vietnam they often get information from the embassy. The most important thing is the willingness of Vietnamese agencies overseas and for businesses to actively co-operate, Mr Monserrate added.

Each business should devise its own export strategy and how to approach for each specific market. The most important thing is to gather accurate information and to make an early decision.