Duc Thanh – champion for wood export industry

By Thai Hang in HCMC Le Hai Lieu (L), general director of Duc Thanh Wood Processing Co., talks with a client. - Photo: courtesy of Duc Thanh Processing Wood Co. There’s little doubt that when the HCMC Department of Industry chose the companies for the city’s 10 Leading Wood Exporters Awards that Duc Thanh Wood Processing Co. was the first name they wrote down. The company that owns four modern wood processing factories mostly in Binh Duong Province produces millions of household and kitchen products and children’s toys made from plantation wood. It will receive one of the 10 awards that mark the 10th anniversary of the first HCMC Expo at this year’s International Furniture & Handicraft Fair and Expo. The wood maker was established in the early 1990s with only 60 workers. It became a limited company three years later with registered capital of VND2 billion, specializing in wooden household products for export. In 2000, Duc Thanh became a joint stock company, and attained BVQI’s ISO 9001:2000 certification for quality management. In October last year, Duc Thanh increased its registered capital from VND74 billion to VND103 billion to become a listed company on the HCMC stock exchange. Le Hai Lieu, general director of Duc Thanh said the company’s BVQI certificate on quality management was the guarantee for foreign importers in the U.S., Europe and Japan that helped the company move forward. It was the catalyst for more export orders. Since 2000, more Vietnamese wood and handicraft makers have made their way in the international market gaining wider trust of foreign customers. Meanwhile, Lieu, the then deputy chairwoman of HCMC Handicraft and Wood Association, and other wood exporters recognized the cost barrier for a lot of wood product makers to go to expos in Germany and the U.S. Lieu came up with the idea to hold an international expo here and suggested it to the city leaders. She was among the most successful business women in the city and she persuaded the city authorities to hold the city’s first trade fair in 2000, at which Duc Thanh was an exhibitor. Three years later the HCMC Expo became a fair specializing in wood and handicraft exports. “The results in the first few years of Expo encouraged me a lot, even though there weren’t many high-value contracts or long-term clients,” she said. Since the first wood and handicraft fair in 2003, exporters have received a lot of financial support from the city, especially from the then Department of Trade now called Department of Industry and Trade. The trade department promoted the fair through Vietnam’s international trade agencies. The relatively low price of a stall made the expo very popular with companies. In 2003, Duc Thanh inaugurated its second plant and two years later, the third plant on a three-hectare area in Tan Uyen District, Binh Duong Province to meet export demands. In February 2005, the wood maker signed a strategic partnership contract with Mekong Enterprise Fund, which invested US$1.35 million in the furniture maker. In 2007, Duc Thanh attracted another investor, the Denmark based Penm Fund, to invest US$2 million into the company’s first IPO on the stock exchange, funds from which went into building the fourth plant on a ten-hectare area also in Binh Duong Province. By 2008, Duc Thanh’s revenues and net profits grew by 185% and 210%, respectively. Lieu by that stage had resigned from her post as deputy chairwoman of HCMC Handicraft and Wood Association, but she kept her stall at the yearly expo that she had helped start. Even during last year’s crisis, when many wood makers had to delay or even close factories, Lieu stood by the fair. “For me, displaying our best products to visitors at Expo is a tradition in my business,” Lieu said. Tran Vinh Nhung, head of organization board of Expo 2010, said Lieu and her wood company are “pioneers of the city’s wood exports that continue to fight for the interests of the local industry.” Lieu, however, is concerned that the exhibition hall for the expo is too small to meet the demand of local exhibitors. “There is no exhibition center in the country that can serve the exhibiting requirements of all the enterprises. If the government doesn’t act by providing land for an expo complex or a multi-story center like Thailand, China, Hong Kong or Singapore and Germany did long ago, we won’t attract the buyers we need,” she said. Duc Thanh’s business strategy is a 15% to 25% annual growth rate and expansion into new markets like Russia, Middle East and Eastern Europe. She expects Expo will continue playing an important role in the plan. The International Furniture & Handicraft Fair and Exhibition or Expo 2010 will start on October 6 at HCMC Exhibitions and Conventions Center. The Saigon Times Daily