Furniture Industry Market Overview -- zhi

GUANGZHOU, China - Nov. 28, 2024 - PRLog -- Transformation and Growth

Chinese furniture industry has evolved significantly over the years, transitioning from manual production to large-scale manufacturing. This shift has improved both production efficiency and product quality. The growth is further supported by Chinese ample labor resources and raw materials. According to 2022 statistics, Chinese furniture production saw a 6.25% year-on-year increase, reaching 1.19 billion units. Growth is largely driven by rising incomes and an increased demand for quality living.

Definition and Classification

Furniture serves various purposes, such as seating, sleeping, or holding items. It's made from materials like wood, metal, and fabric, and falls into different categories:

Material: Wood, metal, plastic, rattan, etc.
Purpose: Tables, chairs, cabinets, bookshelves.
Structure: Complete, folding, modular, wall-mounted, and suspended furniture.

Business Model

Procurement Model

Furniture companies (https://www.topmaxfurniture.com/) usually employ a supplier evaluation system and public bidding to choose raw material manufacturers. Evaluation considers factors like technical capability, product quality, and price.

Production

Furniture companies operate through independent production or outsourcing:

Independent Production: In-house production based on customer orders, followed by order processing and production.
Outsourcing: Some companies outsource production to reduce costs and increase flexibility.

Sales

The sales model combines direct sales and distribution:

Direct Sales: Furniture companies sell directly to consumers through their sales teams or online platforms.
Distribution: Companies sell to dealers, who handle the promotion and sales.

Industry Policy

Government policies play a key role in fostering industry growth. Notable initiatives include the 2023 "Three Products" National Tour, focusing on R&D, design, production control, and brand marketing for industries including furniture. The Chongqing Municipal People's Government also issued a plan to improve inspection services for various sectors, including furniture, over the next several years.

Development History

The development of Chinese furniture industry spans several stages:

Pre-Reform: Dominated by handicraft production.
Post-Reform: Introduction of assembly lines, improving production efficiency and product variety.
1990s: International integration and increased exports.
21st Century: Shift towards quality, health, and environmental concerns, with a focus on high-end and personalized furniture.

Industry Barriers

Brand Barriers

The furniture industry has low entry barriers, leading to a high degree of product homogeneity. However, well-established brands with strong R&D, service networks, and marketing capabilities maintain a competitive edge, making brand recognition a key entry barrier.

Technical Barriers

With increasing demand for environmentally friendly and personalized products, furniture companies must innovate in design and research to remain competitive. Companies with strong R&D capabilities are likely to attract consumers and sustain market share.

Marketing Network Barriers

Due to the need for personalized designs, large-scale production, and professional services, establishing a robust marketing network is critical. Leading companies with established dealer networks and stable customer bases benefit from marketing and after-sales service advantages, making it challenging for new entrants to compete.

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