First ever Design Centre helps add value to Vietnamese handicrafts

Samples and artwork on display

Vietnam handicraft exports constantly grew from of 10% to 12 % annually, reaching 1.5 billion USD in 2010. Several hundred craft exporters with large networks are providing employment for 1.35 million people in some 2,000 craft villages. However, Le Ba Ngoc, Vice Chairman of Vietnam Handicraft Exporter Association (Vietcraft), had his own concern, that Vietnamese exporters were gaining smaller profits and losing their edge in competitiveness to other regional countries such as China, India and Thailand. ”With a 10% profit margin compared to 15% to 20% previously, it is difficult for exporters to reinvest in production because production in the local market is now affected by not only inflation but also fluctuations in prices of materials and labour,” Ngoc said.

The majority of Vietnamese craft exports consist of mass-produced, low priced, every-day basic items at the lower end of the market, and they face fierce competition from other countries. At the same time, global consumers trends increasingly value are evolving towards products with meaningful expressions of their cultural identity and lifestyle that are authentic, fairly produced and environmentally sound.  According to Ngoc, this is where the huge potential lies for Vietnamese crafts. “The majority of Vietnamese producers and exporters only act as an overseas production unit for large international retailers, producing exactly what is requested. I think there’s a lack of innovation, both in originality and product development” he continued.

According to Ngoc, to create more added value for their products, handicraft exporters should pay due attention to market information, product design and customer diversification, focusing on high- and mid-end customers, in order to create more added value for their products. Therefore, Ngoc was thrilled with the opportunity of opening a design center, the very first center of its type in Vietnam in 2012. Under the partner-driven cooperation financed by Sida, the project was a joint partnership between Vietcraft and School of Industrial Design, Lund University, Sweden.   The project aimed to benefit all actors in the value chain, particularly the poorest segment, while ensuring CSR, environmental practices and gender mainstreaming are part of the implementation.

With just over one year in operation, the Hanoi Design Center has offered training to hundreds of handicraft designers and artisans on key topics such as photography skills, product design and development and international market requirements. They were also trained on display and merchandising techniques that are much needed by handicraft businesses that no training institutions in Vietnam have previously offered. The training activities took place at the Centre and at craft villages to provide designers a better understanding about sector and to connect them with handicraft producers and traders. To ensure that activities can continue without outside support, another important activity of the Centre is to train its own trainers. At least 10 local trainers have been selected and received master training so that they will be able to train others in the future.

Le Ba Ngoc prouly shows visitos around Hanoi Design Center

Mr. Vu Hy Thieu Thieu is a graduate from Hanoi Art College, and has worked as designer in the handicraft sector in Vietnam for 30 years. Being trained by the Center as one of the lead trainers, Thieu said that the training has helped him to think more practically and towards the users.  “It is all focusing too much on the artistic aspect. The principles of Swedish design , of prioritising functionality without eliminating grace and beauty have really impressed me. Without being engaged in the work of Hanoi Design Centre, I would never have had chance to understand the meaning of design. It must be truly user oriented”, he said.

In Vietnam, craft production has mainly taken place in the rural areas, and many handicraft companies are located there as well. The fast majority of the owners and managers of handicraft companies have no background in design and only visit craft villages to find new products. In response, the centre provided different methods of training for over 170 managers and executives of handicraft companies. Those training covered international cooperatives such as BSCI, SA8000, CSR, fair trade alliances, and helped in intellectual property issues.The participating companies were coached in developing collections for Hanoi Gift Show in October 2013, Ambience fair in Germany in February 2014 and Lifestyle Vietnam.

Ms. Le Ngoc Minh, Vice Director of Quang Vinh Ceramic Company, said she found that training to recognise the market trend and sustainable designs was effective and very useful. “Based on discussions with Swedish designers, I have already developed two collections for the upcoming annual Ambiente Fair in Frankfurt, Germany. I have emailed one of these collections to one of big buyers in Germany and it is so nice that one of them showed great interest and asked me to send the samples. I believe we can increase our turnover by at least 10% next year”.

The Design Center is well-located in a busy street in Hanoi with total space of 1,200 square meters. The Center has become a regular place for designers and companies to meet and share their ideas on product development.  It is also where tourists find unique products, and where traditional crafts meet contemporary design. On average, the center welcomes some 40 visitors daily, a number that keeps increasing.

A local designer works with modern machine

The Centre has developed 128 new designs and among these, 67 designs have been already transferred to private companies. The well-designed products of handicraft companies that are on display at the center sell very well. At the international level, Vietcraft and Lund University have also promoted the handicraft design business model of Vietnam at Maisonet Objet in Paris, the biggest design fair in Europe. With this event, the centre received good feedback from big buyers such as ABC store (USA), Coran (UK), and Gepa (Germany).

The impacts of the project are also looked after by several participating companies. For instance, VIRI, a fair trade company, managed to increase daily income of wax handicraft producers from VND70,000 to VND110,000 daily on average for its 16 producers in Bac Ninh Province. The same positive impact on poverty reduction happened with a group of 46 ethnic minority Thai people in Quy Chau district, Nghe An province or that received design support for their textile products or 19 people from the Viet Quang Company in Chuong My District, on the outskirts of Hanoi.

 A master artisant crafts details of Muong ethnic embrodery at the Centre

Reflecting on the initial success, Ngoc said that the partnership with Lund was crucial and the project is now continuing beyond Sida’s support which came to an end by December 2013. “Without Lund, our very committed partner, this project would not have been possible. The good news for us is that, seeing concrete results from the project, the Hanoi People’s Committee has decided that it will be bring three designers from Lund University to work at the Hanoi Design Centre for 4 months so that we can continue improving the competitiveness of both handicraft SMEs and producers. Hanoi authorities will cover the entire costs regarding consultancy, hotel and international travel of Swedish expert”.

Ngoc does not want to stop there. While focusing to make Hanoi Design Centre sustainable on its own, he is also looking for ways to expand the initiative. He is now thinking about setting up a national design centre to serve the needs of businesses in other parts of Vietnam. This, he hopes, would involve his partners at Lund University. Despite his graying hair, he is bold and determined to add value to Vietnamese handicrafts sold around the world. Ngoc is not alone in his efforts. The benefits of design are now fully recognised by several handicraft businesses and producers that were part of the project. They are eager and determined to work with him to further increase competitiveness of Vietnamese handicrafts offered to the world.

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