RP furniture continues to stand out in design
March 1st, 2006 Category FurnitureProduct design and development remain as the strengths of the Philippine furniture industry, according to Private Enterprise Accelerated Resource Linkages (Pearl) 2’s State of the Sector Report on Philippine Furniture 2005.
“The sector has creative and innovative designers who can manipulate various materials into furniture designs. But it needs to undertake more market development work to seek out new countries and buyers rather than remain dependent on the US market,†said the report, the third edition published by Pearl 2.
Sixty five percent of Philippine furniture exports of $294 million in 2004 went to the US.
Pearl 2 is a project of the Canadian International Development Agency designed to support the development of small and medium enterprises in the Philippines.
Canadian Ambassador to the Philippines Peter Sutherland handed over the report to Cebu Furniture Industries Foundation Inc. (CFIF) president Michael Basubas after the opening of the 17th Cebu International Furniture and Furnishings Exhibition last Sunday.
The report pointed that the country’s local furniture exports have not performed well in the past few years compared to its competitors in Asia.
“Its (Philippine) exports is only about one percent of total US furniture imports. The country is now even behind Vietnam in terms of supplying furniture to US-based buyers,†it said.
But in a brief speech during the turnover of the report, Sutherland said the furniture-making industry in the country and in Cebu has “great potentials†for growth, particularly in exports.
Challenges
He said the report may serve as guide for furniture makers in addressing not only the needs of the market but also challenges that affect their production.
He cited the relationship of furniture makers with subcontractors as among the challenges that the industry is faced with.
Pearl 2 is assisting the local furniture making industry through CFIF.
Basubas said the CFIF has been using previous editions of the furniture industry report in its strategic planning.
The global demand for furniture in 2004 amounted to an estimated $79.5 billion with the US as largest market, accounting for 37 percent of total imports.
Italy and China are the two largest furniture exporters with a 31 percent share of world furniture exports in 2004. Philippine furniture exports in the past few years have remained “erratic,†averaging a negative growth of almost six percent yearly from 2000 to 2004, the report said.
There are 15,000 furniture makers in the country employing about 481,500 direct workers and 300,000 subcontractors, as estimated by the Department of Trade and Industry.
Raw material supplies and low productivity are among the “persistent†concerns that reduced the competitiveness of local furniture in the global market.
“There is lack of investments in modern machinery, tools and other production facilities that could improve manufacturing productivity and lower costs,†it added.
The report recommended that the domestic furniture sector recover its lost market share and continue to shift its strategy to target the medium- to high-end markets and avoid competing on price where China, Vietnam and other low-cost producers have the advantage.
Meanwhile, in a press conference, Sutherland said the Canadian Government is yet to study if it will extend assistance to other sectors in the Philippines.
Pearl 2 assists 13 sectors that include chambers of commerce and non-government organizations, apart from the furniture industry and small and medium enterprises.
Source: sunstar.com.ph
