Comparison of the advantages and disadvantages of furniture parts production in India and Vietnam


Release time:

2024-06-27

For decades, China has been the main source of procurement for most traders. But with rising labor costs and higher import tariffs, buyers have adopted a "China + 1" strategy to diversify their product sourcing.

 

Especially for Amazon sellers, who may source from the same Chinese manufacturers as other sellers, there is a new challenge to compete.

 

Chinese sellers now dominate several Amazon platforms and account for the majority of new sellers on almost all platforms. This has left Amazon sellers from other countries struggling to find alternative sourcing points.

 

In this article, we compare manufacturing and sourcing in India and Vietnam.

 

Both have many advantages when it comes to manufacturing and exporting general goods - but it is important to understand the nuances of the type of goods, manufacturing technology, production cycle, etc.

 

 

Stability of raw material supply chain

Vietnam is known for its large garment and leather industry, exporting nearly $35 billion worth of goods in 2020. It is also a major manufacturer of wood products and metal furniture accessories.

 

However, the important thing to note here is that Vietnam imports most of the raw materials needed to manufacture these goods from countries such as China and India. Vietnam, as a relatively small country, does not have the ability to grow cotton, wood, etc.

 

On the other hand, India is one of the world’s largest producers of jute, cotton and leather and also has abundant wood, clay, etc. Therefore, it is possible that India could face supply chain challenges for these materials, as Vietnam is currently facing, which is highly unlikely.

 

When it comes to mining raw materials such as coal and metal ores, India and Vietnam are more or less on par in terms of capabilities. India is one of the largest producers of commodities such as coal and metal ores, while Vietnam has large reserves of metals and coal in its north.

 

Value-added products such as handicrafts

One of India’s main advantages over China in terms of sourcing is its ability to produce unique, high-quality handmade products. This value-addition, done by skilled artisans through traditional handcrafting or handweaving techniques, makes Indian products more profitable in the retail market, thereby providing sellers with higher profit margins.

 

About $2.5 billion worth of handicrafts were exported to India in 2020. Indian marble products are hand-carved, and metal furniture fittings are also hand-hammered or machine-made. India is known for its brass and copper products, which are mainly handcrafted and machine-made.

 

While Vietnam specializes in a few specific handicrafts (like lacquerware goods or bamboo woven goods), products sourced from Vietnam tend to be primarily machine-made. Vietnam’s shift toward machine manufacturing has been gradual but lasting, in part because of outsourcing operations from Chinese factories just across the border.

 

Because of this, when comparing India vs. Vietnam manufacturing, India has an advantage over Vietnam in unique, handmade goods, albeit at a higher price. So if you want to sell more unique and higher-margin products on the Amazon marketplace, India might be a better choice if its production efficiency can keep up, whereas Vietnam would be a better choice if you want machine-made and mass-produced products at a lower cost.

 

 

Diversity in Traditional Product Making Techniques

Even with handicrafts, Vietnam and India have an advantage in certain manufactured products.

 

India has a long history of making jewelry with precious metals and gemstones. There is an inherent advantage here due to traditional designs and expertise that have been passed down for centuries. Indian jewelry accounts for about 29% of global jewelry consumption.

 

The same is true for carpet and rug making. India still follows the traditional way of making carpets, and exports in this category are $1.3 billion.

 

Vietnam specializes in lacquerware goods. The art of lacquerware developed throughout Asia centuries ago, but Vietnam’s style is unique and valued worldwide. Handmade silk products are also an important part of Vietnamese culture and are of very high quality.

 

 

Shipping Costs and Duties

Given that India and Vietnam are relatively close geographically (the two countries are about 2,000 miles apart – a 4-hour flight), there is not much difference in shipping times and costs between the two countries.

 

Shipping times from India to the US East Coast and the EU are shorter, while Vietnam can ship faster to the US West Coast, Australia, and New Zealand.