Vietnam Rises as Global Furniture Manufacturing Powerhouse

Vietnam's furniture manufacturing industry is emerging as one of the most dynamic sectors in Asia, rapidly gaining market share on the global stage. Once considered a regional supplier, the country has grown to become the world's second-largest furniture exporter and sixth-largest manufacturer, thanks to competitive labor costs, skilled craftsmanship, and strategic trade partnerships.

Wood furniture production in Binh Duong. Photo source: DP Furniture

RAPID MARKET GROWTH

The Vietnam furniture market is projected to reach USD 9.62 billion in 2025, with forecasts indicating growth to USD 13.14 billion by 2030, representing a compound annual growth rate (CAGR) of 6.43%. This steady trajectory positions Vietnam as one of Southeast Asia’s most dynamic consumer goods markets. Key growth drivers include robust foreign direct investment that sustains high factory utilization rates, preferential trade agreements that enhance export competitiveness, and a digitally connected middle class with a growing appetite for design-driven furnishings.

The domestic market alone is also showing impressive momentum, growing from US$1.4 billion in 2023 to a forecasted US$2.56 billion in 2033. This rise is driven by rapid urbanization, increasing disposable incomes, and a growing middle class seeking modern and sustainable living solutions.

GLOBAL EXPORT LEADER

Vietnam exported nearly US$16 billion worth of furniture in 2023, with projections indicating the figure could surpass US$20 billion by 2026. The country has overtaken China in some key categories, particularly in wood furniture exports to the United States.

Year	Export Value (US$ Billion)
2018	8.66
2020	13.2
2023	15.9
2026*	20.0 (forecast)

U.S. MARKET DOMINANCE

In 2022, Vietnam became the top furniture exporter to the U.S., accounting for 36.4% of total U.S. wooden furniture imports, displacing China, which fell to second position. This was largely due to U.S.-China trade tensions and Vietnam's stable political and manufacturing environment.

MANUFACTURING STRENGTH

The industry employs over 500,000 workers and comprises more than 5,600 companies, of which approximately 1,500 are export-focused manufacturers. Key manufacturing hubs include Binh Duong, Dong Nai, and Quang Nam.

Vietnam's natural advantage includes abundant local materials (rubberwood, acacia, bamboo) and government support in land, tax, and export procedures. However, sourcing sustainably remains a critical issue, especially for access to EU and U.S. markets.

Key Wood Suppliers and Resource Regions

Vietnam's furniture industry relies heavily on domestic timber, with over 60% of raw material demand met by locally grown species such as acacia and rubberwood. In 2024, Vietnam has nearly 4.5 million hectares of planted forests, with acacia making up over 50% of the total plantation area.

The key raw material regions include:

Region	Main Wood Types	Key Provinces
Central Vietnam	Acacia, eucalyptus	Quang Nam, Binh Dinh
Southern Vietnam	Rubberwood, acacia	Binh Duong, Dong Nai, Long An
Northern Vietnam	Acacia, mixed hardwoods	Yen Bai, Tuyen Quang, Son La

Binh Dinh Province alone employs more than 40,000 workers in the furniture sector and is a key production hub with increasing adoption of green technologies and certifications.

Kim Bong village in Quang Nam, dating back to the 15th century, is a traditional woodworking center, now part of Vietnam’s cultural and production heritage.

OPPORTUNITIES AND CHALLENGES

The country's integration into global supply chains is backed by free trade agreements (FTAs) with the EU, CPTPP, and RCEP, enabling lower tariffs and broader market access. But with opportunities come risks:

• U.S. Tariff Threat: In May 2025, the U.S. Trade Representative proposed up to 46% tariffs on Vietnamese wood furniture, citing potential transshipment of Chinese goods.

• Supply Chain Scrutiny: Both EU and U.S. markets are tightening rules on traceability and environmental compliance, demanding legal origin certification of timber.

• Labor Shortages: Despite abundant labor, the industry is beginning to feel pressure from rising wages and competition from other sectors.

FUTURE OUTLOOK

Vietnam is expected to maintain its upward trajectory by embracing automation, green manufacturing practices, and supply chain transparency. Companies are increasingly targeting EU markets to diversify away from U.S. dependence, especially as trade tensions persist.

"Vietnam has built a strong foundation. The next phase must be about branding and technology," said Mr. Nguyen Chanh Phuong, Vice President of HAWA.

CONCLUSION

With a robust export record, strategic geographic position, investment in skilled labor and technology, and increasingly localized raw material supply, Vietnam is no longer a low-cost alternative but a central player in global furniture supply chains. As the world looks for stable, sustainable sources of high-quality home furnishings, Vietnam is clearly positioned to deliver.