Finnpartnership:

From hardships to success in Vietnam

Established in 1898, Niemen Tehtaat Oy is the oldest furniture manufacturer in Finland. The family business has long been exporting its products but at the beginning of the 21st century a completely new pace was set for internationalization when the company started investigating what Asia could offer.

China did not seem to be the logical place for a small to medium-sized business, and the Finnish entrepreneur ended up in Vietnam. The company had previously bought small shipments of furniture and sought to establish itself via familiar business partners. In 2004 a joint venture was founded with a company that manufactured wooden garden furniture but the project miscarried later.

In a difficult situation, as they moved onwards from a partnership to establishing their own subsidiary, Niemen Tehtaat received background support from Finnpartnership in the form of Business Partnership Support. Expert lawyers, accountants and other experts are not cheap in Vietnam either.

Since establishing Niemen Tehtaat Vietnam Ltd, development has been positive and the company intends to expand and develop operations in Vietnam. Only hard work and long-term operations yield results.

Local rules of play need to be thoroughly known

The legislation and business culture in Vietnam need to be thoroughly understood in order to succeed. It is worth seeking help from experts, who can sometimes be found in international accounting communities. Professional and reliable staff who can handle the complex bureaucracy are also vital.

The Vietnamese subsidiary has around 20 employees in their administration and goods inspection, all of whom are local. Indirectly the company employs well over a hundred people.

The company has over 50 suppliers ranging from small workshops to larger factories. Niemen Tehtaat is planning to manufacture products itself. At the moment, plastic polyrattan summer furniture and local carpets and crafts are bought from Vietnam. Finding trustworthy manufacturers that produce high-quality goods is not easy.

Responsible business to Vietnam

Long-term business partnerships also help to develop quality and ensure that the partner is acting responsibly. Niemen Tehtaat meets with their partners regularly and visit the site of operations. In this way they can contribute to responsible business and respect for employees.

The products produced in Vietnam complement the entire product range for Niemen Tehtaat. The production facilities located in Sastamala and Suodenniemi in Finland manufacture mainly wooden furniture. Production has not been moved from Finland to Vietnam. Vietnam makes Niemen Tehtaat a more interesting partner, so operating there also promotes Finnish operations.