Response Vietnam Co., Ltd. is a furniture manufacturing company which is fully owned by CoreOne in Denmark. The factory only supplies CoreOne (and ultimately CoreOne's customers,) and CoreOne only sources from this single factory. The company was established in 2013, and in order to maintain the most cost-efficient supply chain, everything related to technical development, purchasing, production, quality control, and shipping is controlled by our Vietnamese team.
Starting as more of a workshop with 20 colleagues, the factory is now 25,000 sqm and our team of 700+ employees ships around 20 containers per week. We are situated in the Binh Duong province, in a furniture cluster app. 50 km north of Ho Chi Minh City with a strong infrastructure and easy access to ports, sub-suppliers, and staff. Staff retention is a major focus area for us, and through a variety of initiatives and incentives, we have been able to maintain continuity and stability for several years.
Our CEO of the factory is Danish, and a few other expats roam the office and factory floors, but the main part of our managers are Vietnamese. Our customers and the colleagues in Denmark visit the factory as often as possible, acknowledging that CoreOne's most prominent competitive advantage is the ownership of a well-managed, capable, and scalable furniture factory in Vietnam.
WHAT WE DO IN VIETNAM
We move fast on bringing new products to market through a highly efficient technical development department in Vietnam. We do construction, prototyping, and pre-testing inhouse, and that allows us to produce tests and First of Production samples shortly after approving a design. Our skilled sample makers make more than 1,000 samples every year. Our product engineers and packaging experts make sure that products are constructed and dimensioned to properly accommodate design, material consumption, and production processes. In the development phase, our products and materials are tested for market compliance by internationally accredited certification agencies, and our Quality Assurance team always has a final saying about the practicability of a design.
We manufacture more than 1,200 different SKUs, and due to the climate in Vietnam, it is not viable to make to stock. Therefore, we only manufacture by order, but we do hold a certain stock of chemicals, fabrics, and fittings. Metals, foams, leathers, and packing materials are procured through Just-in-Time contracts by our Vietnamese team of buyers. Our woods are exclusively American White Oak and American Black Walnut and are bought from sawmills in the US and shipped in full loads with almost daily intake at our factory. We scale craftsmanship to mass production using several artisanal techniques in woodworking and upholstering, and our factory runs modern machinery with high output potential. But we are in fact set up for relatively small batch sizes. This enables our customers to build their containers with mixes from the entire assortment, at low MOQs, and with short lead times. We are flexible with product sizes, surface treatments, fabrics, and leathers, and most customers have their own designs for box labelling and assembly instructions.
Through past years’ vertical integration, we process all components and do surface treatment and mounting inhouse. This gives us more scale, better quality, and higher consistency of supply. We use our Dynamics 365 ERP engine to run capacity and master planning by digitally routing all our processes and machine setups. Scalability is crucial to us, and we have detailed plans for our capacity growth. Customers are always welcome to visit our factory to get a deeper understanding of how we develop products, manufacture, and boost digital integration in production. It is very important for us to demonstrate that we maintain a strong commitment to both quality and consistency of supply, as well as to safety, to the environment, and to our other CSR values.
How the consumer perceives our quality has an immediate impact on our success. Together with our largest customers we constantly measure the quality ratios for our products, and we currently average at 0.5% faults. For all material that arrives at our factory, and for every single component processed at each section of our factory, there is quality control. We collect thousands of quality data points throughout production every day, and any deviance from conformity is reported and acted upon immediately. Every single aspect of quality is documented and visualized by our Quality Assurance team, and a meaningful quality culture is deeply rooted in our organization.
After final control and packing, and just before loading, an internal third-party control team, separate from the QC team, picks products from the shipping shelves and performs AQL II testing. A few customers prefer to use external auditors, and they are welcome to use our designated approving facilities with the help of our team.
PACKING & SHIPPING
Durable packaging is part of a quality product, and we pay much attention to selecting and designing adequate packing materials. Balancing between not too much and not too little, and trying to avoid unnecessary air in the boxes, we are using highly protective, impact-absorbing materials. To accommodate our environmental targets, we have developed packaging designs and materials to reduce the use of EPS by up to 90%. Some of our larger customers' assortment are now packed in our "green packaging", and we implement it for the rest of our assortment over time. Whether "green" or not, all our packaging meets direct-to-consumer shipping standards and have been tested for market compliance.
A part of our order intake procedure is to layout the container filling right away, so that we are sure to load with utmost caution and pack in the most advantageous way. If requested, we pack on pallets or paper slip sheets, but most of our customers prefer hand loading as the most space-efficient way.