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Traditional craft villages look to expand their market online

Update: June, 13/2013 - 09:54

HA NOI (VNS)— Traditional trade villages across the country are being urged to make better use of online commerce to promote their products.

"E-commerce is expected to be a new way for Vietnamese handicraft producers to find new customers, especially foreign ones," said chairman of the Viet Nam Trade Villages' Association Luu Duy Dan.

He added that finding markets for products was more and more difficult for Vietnamese producers during tough economic times.

Out of 3,500 trade villages across the country, 400 villages produce handicraft products, many of which have been made for hundreds if not thousands of years.

Since Viet Nam gained membership of the World Trade Organisation in 2007, handicraft villages have benefited from increased sales in foreign markets, which resulted in the expansion and establishment of many enterprises, improved infrastructure and technologies and the emerging trade village tourism sector, he noted.

However, during the last few years, handicraft businesses have seen a slowdown in growth while limited finances, a dearth of creative new designs and poor marketing are becoming increasingly serious problems for the sector.

Under a co-operation project launched last year between the Viet Nam Trade Villages' Association and Viet Nam Chamber of Commerce and Industry (VCCI), enterprises and co-operatives in trade villages have been supported to apply information technology in their promotion and distribution activities.

Nearly 500 enterprises from trade villages would have their names featured in the popular Google Maps application, which features geographical indicators that help people locate businesses.

Moreover, their products are introduced online which would also allow more customers to make purchases without having to visit.

Head of the Business Informatics Institute under the VCCI, Le Van Loi said that enterprises in trade villages were mostly developed from households with limited human resources and technological application.

The project would focus on human resources training and transfer of technology, he said.

"It is expected to be a vital step to set up distribution networks at an affordable cost and improve access to domestic and international markets," Loi said, emphasing that at the same time, producers still need to guarantee and raise product quality.

Head of Policy Consultancy Board of Trade Villages' Association Truong Quang Can said that enterprises in trade villages faced difficulties in gaining market share as they were often small businesses and did not have the necessary promotion and marketing skills.

In some cases, producers copied each other's designs illegally, causing conflicts relating to patent rights.

Vu Quoc Tuan, chief advisor to the association, said that sales of many villages have declined 30-40 per cent in the past two years due to the negative impacts of the global financial crisis and economic recession.

Many craft villages have seen volumes of new export orders falling by more than a half, and quite a few households have switched to other businesses, Tuan said.

Dr. Nguyen Trong Thua, director of the Department of Agriculture, Forestry, Fishery Product Processing and Salt Industry, ascribed this situation to fierce competition from similar products made in other regional countries.

Overall, the domestic handicraft industry lacked creativity, he said. Meanwhile, many craft villages were facing a shortage of capital and production materials to fulfill high-value orders.

Furthermore, many craft villages now have significant quantities of products unsold, Thua said.

In addition to assisting handicraft enterprises apply e-commerce solutions, the VCCI has established a trade promotion centre responsible for helping craft villages and enterprises strengthen their foray into regional markets.

It has also encouraged them to restructure production to cut costs, improve production as well as design capabilities, Thua said. — VNS

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