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The essentials of an essential oil company in Vietnam

Friday, May 29, 2020, 12:10 GMT+7
The essentials of an essential oil company in Vietnam
Doan Ngoc Minh Thuy (second left) at a meeting with partners in this supplied photo

Doan Ngoc Minh Thuy, a 30-year-old woman from Vietnam’s Mekong Delta, hopes producing essential oils in her hometown will bring about a much-needed boost to the local economy.

While most young graduates from Vietnam’s rural areas are making permanent moves to the country’s major cities, Thuy believes her opportunity for success lies in her rural hometown in the heart of the Mekong Delta.

After two years of post-graduate research in bioengineering, as well as a keen understanding of Vietnam’s farming industry, Thuy sets her sights on reigniting Dong Thap Province’s economy by working with its farmers to produce essential oils.

Thuy first began researching and making her own essential oils during her second year in university, and it was not long before she realized how few players there were in the market.

“People in my hometown were baffled when I told them I was studying essential oils. They had no idea what that was,” she said.

“I thought working with them to produce [oils] could help could boost the local economy.”

A modest start

On a research trip to the Lai Vung mandarin orange plantation in Dong Thap Province, Thuy discovered that nearly half of the farm’s products were being wasted as workers sacrificed smaller oranges so larger ones could thrive. 

While the practice made economical sense for the farmers, the woman saw an opportunity to purchase premature fruits and herbs, such as limes, mandarin oranges, lemongrass, and mint, at cheap prices.

“The upside for famers is that it increases the productivity of their plantations and prevents any negative environmental impacts from constantly allowing old fruit to rot in the soil,” she explained.

Thuy registered her essential oils company, Huong Dong Thap Ltd., in 2017 using her personal savings as primary funding and began extracting oils from local produce at her house in Dong Thap. 

As her business began to expand, she gradually started sourcing ingredients from provinces throughout Vietnam, but paid special attention to purchasing the majority of her stock from the country’s southwest.

She currently produces essential oils from limes, mandarin oranges, pomelo peel, lemongrass, lotus, mint, turmeric, and rosemary leaves.

Extracting the oil varies between each plant, depending on its characteristics. Some, for example, must be ground, while others must be sliced, minced, or kept whole.

It takes about four months to refine each batch of oils.

Essential oil is being tested in Doan Ngoc Minh Thuy’s lab. Photo: Dieu Qui / Tuoi Tre

Essential oil is tested in Doan Ngoc Minh Thuy’s lab. Photo: Dieu Qui / Tuoi Tre

Behind the scenes

Bottles of Huong Dong Thap essential oils sell for VND110,000 (US$4.72) to VND700,000 ($30) each, with lotus-based products being toward the top end of that spectrum.

According to Thuy, it takes one metric ton of premature limes and lemongrass to produce one liter of pure essential oil, or one hundred 10ml bottles.

Melaleuca, lemongrass, mandarin, and pomelo are Thuy’s most popular products, and raw materials to produce essential oils from these plants fetch from VND3,000 ($0.13) to VND10,000 ($0.43) per kilogram.

Though overall the business has been successful, Thuy says her revenues are a roller-coaster ride, with some months meeting her sales targets and others falling wildly short.

During the COVID-19 pandemic, for instance, sales were high due to the well-known benefits of essential oils to human health but, as production costs rose during that period, Huong Dong Thap’s profit took a serious blow.

“I frequently evaluate my customers’ needs and take a proactive role in leading my company,” Thuy said.

“I don’t sit around and wait for opportunities. When a product sits too long on the shelf, I immediately try to find out how it can be improved.”

Seeing opportunity in competition

“Despite my initial hurdles, I was profoundly motivated by the help of my family and even local authorities. I also believe I chose the right time to begin my business project,” Thuy said.

Though Thuy was faced with low sales at the beginning of her career, as well as problems with sourcing raw materials and marketing her products, she has not let that stop her from continuing to develop original products that can outshine the competition.

“The competitive market will impact us, but I see that as an opportunity to differentiate my products. We might be a small business, but I am confident that we can stand firmly in the market,” she said.

Her future plans include introducing new products, as well as expanding her factories and partnerships.

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Tien Bui - Dieu Qui / Tuoi Tre News

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