Design: An International Language
In the previous issue, my editor-inchief spoke about an iPod business model for furniture makers, i.e., creating a cult following, and sales revenue, through design and aggressive advertising. This is, arguably, a farfetched ideal for most Asians who fly the low-cost banner.
But at least one tiny city-island in Asia has begun its quest towards this direction, by making inroads into the design mecca – Milan.
From Singapore, five design-led companies showcased their wares under a collective brand, Singapore Mozaic, during the Salone Internazionale del Mobile held in Italy from April 16-21. Despite this being the country’s debut effort, the crème de la crème received cheering response with spot orders signed and expected follow-on sales of about S$1.8 million.
The five Singapore Mozaic brand ambassadors that participated were Air Division (featured in our March 2008 issue), Getz Gallery in collaboration with HybridMatter (pg 72), Koda (pg 32), Star Furniture Industries (pg 72) and The Life Shop. Finally, there is a strong Asian voice that contributes to part of the international language of design.
Tan Li Lin, Director, Lifestyle and Business Services Division, IE Singapore said, “Design provides an important competitive advantage for Singapore companies’ inter nationalisation strategy... The Singapore furniture industry’s inaugural showing at the prestigious Salone Internazionale del Mobile is an international nod of recognition for Singapore design and helped raised the profile of Singapore’s furniture industry to international furniture players and architects.”
Trend-setting pieces from Salone Inter nazionale del Mobile and SalonSatellite are featured in our Hit Guide section on pages 39-41. In addition, award-winning pieces from the Philippines’ Cebu X (pg 62-63) and Chicago’s Best of NeoCon (pg 45-46) can also be found.
From Asia to Chicago, call this an eclectic issue if you like, but I’m sure this is something our international mix of readers will appreciate. For the first time, we bring you a Regional Report on Russia (pg 35). By charting the inroads that Ikea has and is continuing to make in the federation, it becomes apparent that the emerging market has finally surfaced from a long time under the radar.
We also bring you Industry Outlook articles on China (pg 47) and the US (pg 51). According to statistics, imports by China experienced a growth rate of 37.68 percent, in comparison to a 29.5 percent growth posted by exports. Just as Shenzhen Furniture Trade Association’s Secretary General Oliver Hou said in our Talking Point section (pg 64): China’s consumer market cannot be overlooked and has the potential to become yet another alternative market even to other Asian exporters in no time.
And time, to Indonesian home furnishing retailer, Herman Dexter, is indeed of the essence. Seizing opportunities of gloomy economic conditions in 2001, the retailer turns bad times into rolling good times by offering more than its peers do, and doing it all when no one was interested to. Read more about what makes it stand out on pages 42 to 44.
Johor Bahru, Malaysia: Muar Industries Sdn Bhd, a manufacturer well known for its outdoor furniture for the high-end and premium markets,is now growing its focus on indoor furniture as well. In 2007, the Muarbased manufacturer decided to grow the indoor segment into a significant part of its offering
In fact, Muar Industries, with close to 30 years’ history, used to manufacture for both segments in the beginning, but the concentration was largely on outdoor furniture only.
“The company used to produce small quantities of dining sets made of rubberwood and has over the years accumulated experience in handling several kinds and grades of wood. With this expertise, as of 2007, we moved towards the use of American white oak for our dining sets. Foreign buyers are sourcing in Asia for furniture made of European or American woods. Many manufacturers in Southeast Asia have also been importing these timbers. We thought we could do the same and export to the mid-high end markets in Europe and Japan,” Executive Director, Desmond Tan said.
Its outdoor furniture adopts the same strategy in using the choice of wood to target even higher strata of consumers. Although Malaysia is well known for its rubberwood, Muar Industries creates pieces primarily from teak and selected species of red meranti wood. Said Tan, “Teak is known within the industry as the best kind of wood for outdoor furniture. And as it is one the most expensive timbers, this range is targeted at the premium market. We also have a red meranti wood range for the high-end market. These selected red meranti species score high in terms of durability, stability and appearance.”
Muar Industries’ largest export market is Europe and consumers there are increasingly demanding furniture made from sustainable sources of timber. In line with market requests, Muar Industries has a collection that is certified by the Forest Stewardship Council (FSC). Tan said, “I think we all have the responsibility to protect the Earth. Even for non-FSC collection items, we use only legal timber from sustainable forests managed by proper authorities.”
To keep abreast of the outdoor market, Muar Industries has been participating in garden fair Spoga since 2002. The company also exhibits yearly at the Export Furniture Exhibition in Kuala Lumpur, Malaysia.
Ho Chi Minh City, Vietnam: As reported by Vietnam News, furniture exporters have been increasingly concerned about the legality and traceability of timber. Part of the issue stems from the demands of European and American clients.
At the half-day event, jointly organised by the HCM City Handicrafts and Wood Industry Association (HAWA) and Swissbased certifier SGS group, Huynh Van Hanh, HAWA vice president, said timber quality should not only be assessed by the product itself but also by the connected ecological terms.
The US has recently passed the Agricultural Act governing violations in the use of timber and plants. The act will impose civil and criminal penalties on illegal timber, which, Hanh said, is expected to affect the furniture and other wood-based industries, not only in the US but also other western nations.
He urged local businesses to pay more attention to the origin of their timber, select accredited suppliers and demand certificates to show it was legally logged and environmentally friendly. “Evaluating the legality and origin of timber is to generate confidence among customers and boost the image of Vietnamese furniture on the global market,” Hanh said.
Bruce Telfer, manager of SGS’s Forestry Monitoring Programme in the Asia Pacific region agreed, saying it was important to evaluate the timber’s legality given illegal logging had become a focus of attention in major markets like the US, Japan and the EU.
Illegal timber poses a risk to the country’s furniture industry that brought in some US$2.4 billion in export revenue last year and is expected to jump to $5.5 billion by 2010. Telfer requested local authorities to provide support to evaluate the timber’s legality and traceability.
Dhaka, Bangladesh: Trendex Furniture Industry Ltd is expected set up a furniture manufacturing facility in the Karnaphuli Export Processing Zone (KEPZ), according to reports by United News of Bangladesh.
The Taiwanese company will invest about TK 408 crore (US$59.56 million) to build its production base in the KEPZ. The plant will produce a variety of furniture, including occasional and accent furniture as well as contract/office furniture. The development is set to create employment opportunities for some 10,085 Bangladeshis.
An agreement to this effect was signed between the Bangladesh Export Processing Zones Authority (BEPZA) and Trendex in the BEPZA Complex recently.
Ho Chi Minh City, Vietnam: The Ho Chi Minh City Association of Woodwork and Fine Arts (HAWA) officially denied allegations that Vietnamese woodwork companies used illegal timber from Laos for processing, as reported by the Vietnam News Brief Service.
State media has called the accusation levelledat the industry by the UK’s Environment Investigation Agency (EIA)
and Indonesiabased Telapak, a series of ‘calumniations’. Huynh Van Hanh, Vice Chairman of HAWA said, “After two months [of] investigation into its six membercompanies of Dai Thanh, My Tai, Quoc Thang, Hoang Phat, TAIANH and
VINAFOR, HAWA pledged that they did not use smuggled timber.”
According to Hanh, the accusation that at least 500,000 cubic meters of logs moved from Laos to Vietnam every year is groundless, adding that Laos has banned exports of logs for several years.
In 2007, Vietnam imported more than 250,000 cubic meters of timber worth US$84 million from Laos, mostly for domestic use and the construction industry, not furniture. Last year, Vietnam imported around 445,000 cubic meters of eucalyptus and acacia timber from other countries to produce outdoor furniture, Hanh added.
Hanh says that the 24-page report by the two NGOs fail to recognise the efforts by the Vietnamese woodworking industry to attain international ecofriendly certifications. Forest Stewardship Council (FSC), granted certificates to 151 Vietnamese furniture firms in recognition of the legitimate origin of the timber they used.
The figure put Vietnam at the top of the rankings in ASEAN: Malaysia has 66 firms, Indonesia has 59 and Thailand has only eight. To enhance Vietnam’s credibility, HAWA will encourage its members to participate in various programmes to assure consumers and international buyers that its timber is above the board.
Hanh noted that it was unfair to link the development of the Vietnamese furniture industry with illegal timber, adding, “Our strong growth stems from the continuing efforts of the government and businesses.”
Vietnam exported US$2.34 billion worth of furniture in 2007, with the US accounting for 40.2 percent. Its main importers include Japan, the UK and China.
Koronadal City, Philippines: The region’s furniture industry needs government support, particularly in extending market reach, to develop into a strong sector, a regional Trade official said in an interview with BusinessWorld Philippines.
“An effort to promote locally made furniture, either from the National government or local government, is necessary if furniture industry in the region is to thrive,” said Rictoniel T Reginio, senior business development specialist of the Department and Trade and Industry in Central Mindanao, “Materials, skilled labour and technology are available, but the failure of local furniture makers to tap foreign markets has been a key obstacle.”
While there are promotion plans for the industry domestically, it lacks access to global opportunities. Unlike in other parts of the country where trade links are well established, Mindano needs support from the central government if it is to flourish.
Reginio said local furniture makers should take advantage of the availability of Gmelina wood. Gmelina plantations are present in Surallah, T’boli, Lake Sebu and Banga towns in South Cotabato, as well as in nearby provinces.
“The regulation for Gmelina is not as strict as other furniture wood materials,” he said. Gmelina is normally used for making pallets and boxes, though local furniture makers have started using it for low-end furniture products.
Ma Anisia M Lustria, a small-scale furniture maker based in South Cotabato, said easy access to and low cost of Gmelina makes it a good material for furniture. Narra, Molave and Apitong, though still much preferred furniture materials, have been scarce for decades now as a result of logging bans in certain parts of Mindanao. The Autonomous Region in Muslim Mindanao imposed a total log ban in 2006 to protect the region’s remaining forests, resulting in scarcity of good quality woods and other forest-based materials in nearby regions.
Manila, Philippines: According to a report by Thai News Service, the local market is seen to be a lucrative venue for Filipino furniture makers as furniture companies from the Cordillera Administrative Region (CAR) bagged the highest sales in the recently concluded National Trade Fair (NTF), a government organised fair for the domestic market. The NTF is organised annually by the Department of Trade and Industry (DTI) through the Center for International Trade Expositions and Missions (CITEM). It featured 185 enterprises from 17 regions.
Local demand for furniture is considerably good, many buyers now look for simpler lines, more natural hues and finishes, said Henrietta Gayao, Manager of Gayao’s Furniture. “We got a substantial amount of orders for the said pieces from the fair. We are also finalising our agreement with a homeowner in Antipolo, contracting our shop to furnish the whole house,’ said Gayao.
Philippine furniture is one of the priority export products given assistance and support by the government and the fair serves as a platform to boost the capabilities of Philippine industry.
Industry estimates place the number of furniture firms at 15,000 directly employing 500,000 workers. Another 300,000 are indirectly employed. Subcontractors and suppliers are estimated to be at about one million.
Some 90 percent of the 15,000 manufacturers comprise of Small and Medium Enterprises (SMEs);about three percent employ between 151 to 800 workers, seven percent employ 31 to 150 workers, 60 percent employ six to 30 workers while the remaining 30 percent have five or less workers. About 9,750 are cottage or small manufacturers.
Top export destinations of Philippines furniture are Japan and the US, which constitute 72 percent of Philippines’ total output.
Despite its size, the industry remains lagging behind, mainly depending on the handing down of skills from one generation to the next and on-the-job training.
Beijing, China: Fordaq reported that from January to April 2008, total domestic sales of furniture in China amounted to US$8.5 million, a 22.43 percent increase compared to the same period in 2007. Furniture export revenue increased significantly, nearly reaching US$9 billion, a 30.91 percent increase from a year earlier. Imported furniture totalled US$400 million, a 28.79 percent increase from a year earlier, according to a report of China National Furniture Association. For wooden furniture, export revenue reached US$1.396 billion, a 7.1 percent increase from 2007, the export products decreased 5.3 percent compared with 2007, totalling US$40.2 million. Perhaps this represents an increasing the perunit price of China’s furniture exports.
Chen Baoguang, the Vice President of the China National Furniture Association, pointed out the challenges that the Chinese furniture Industry faces: integration into the ‘new’ economy, ramping up original designs instead of simply copying styles and the need to reform traditional business practices. He said this during the China Furniture Industrial Development and Reform Seminar held during the China International Furniture Exhibition in Dalian on June 12.
Giving the industry some pointers, he said: ”Following the American Anti-Dumping and subprime mortgage crisis, some enterprises that used to export to America can take this chance to adjust their export market to domestic, Middleeastern and South Asian countries. The furniture enterprises should pay more attention to research and development to decrease raw material and labour costs.”
Shunde City, China: Furniture/Today has reported that construction of the Asia International Furniture Material Trading Center (Asia Star for short) will be completed in 2010. Construction started in 2004 and it is now home to more than 700 companies occupying 6.8 million sq ft of space (600,00 sq m).
The US$290 million project is about 60 percent complete and is expected to reach some 12 million sq ft (1.1 million sq m) when operational, which is about the size of all the High Point Market showrooms combined.
Asia Star will house 1,500 materials suppliers and 200 logistics firms offering their services to the industry, according to its developer. It also will have six administrative buildings, a hotel, an apartment building and an exhibition building for a twice-a-year materials trade show.
The developer is Hechuangying Real Estate Co, which says it wants to build the facility as a “one-stop materials trading platform” aimed at better serving an estimated 3,000 furniture manufacturers and suppliers in China. Shunde City is about an hour southwest of Dongguan, a furniture manufacturing hotbed.
“The original purpose to set up this trading center is to get a huge a number of manufacturers and material (suppliers) together and build up an interactive trade platform for the buyer and supplier, so that the material industry could serve the furniture industry,” the developers said.
The facility is expected to draw some 10 million visitors a year, including those who attend the suppliers shows in March and September. The show, which ultimately will cover 2 million square feet (185,500 sq m), will be called the Asia International Furniture Material Expo. The next show is scheduled for September 7-10, 2008.
Officials expect most of the visitors will be from China, but some international buyers are expected too — largely from furniture manufacturers looking to secure the best deals on hardware, finishing materials, fabrics and anything else used in furniture production.
Taipei, Taiwan: Some companies may consider cutting staff or reducing raw material costs in the midst of business slowdowns but not Taiwanese chair manufacturers, Taiwan Economic News reports.
What Taiwan has lost in terms of volume-produced wooden furnishings that involve intensive labour input and low labour costs, it has gained strength in the segments that call for designoriented furniture, eco-friendly furniture and office automation (OA) furniture.
Such items generally require relative higher levels of technology, manufacturing standards, management science, and quality control, conditions that are not thought as widely available in emerging economies as China and Vietnam. Today most OA furniture manufacturers in Taiwan focus on producing office chairs and their component parts. Relying on quality, assured consistency and value for money to carve a global niche, a substantive number of OA furniture makers that have kept open their Taiwan operations have also set up overseas footholds, aiming to diversify manufacturing risk. The majority have relocated to China.
Kuo Ching Furniture Decoration Co is one of Taiwan’s largest OA furniture makers, having more than three decades of experience in producing office chairs They have diversified into other lines such as sofas, lounge chairs and children’s furniture in recent years.
Kuo Ching’s mesh-back office chairs are increasingly popular among buyers. The company, established in 1979, has focused on creating value rather than absolute price competition backed by a corporate philosophy of ‘creating the best products for clients’.
Edward Chang, Design Director at Kuo Ching Furniture points out the considerable changes that office chairs have undergone in recent years in terms of material and design. In the early days, office chairs reflected classbased mindsets in corporate culture, where chairs were mostly of wood, foam, leather or synthetic leather, with fancier design and thick seat cushions for executives and high-ranking officials and simpler designs and thinner cushions for lower-echelon staff. Ergonomics
as science was generally not part of furniture design previously. “Today many office chairs feature ergonomic designs with ventilated mesh backs in addition to height-adjustable seats and arm
rests, as well as caster-installed feet,” Chang said, “Currently some office chair makers are trying to use industrial plastics as the predominant ingredient to enable injection fabrication-specifically integrating into a single unit the back and seat.”
Beijing, China: Despite China’s rising costs, many foreign companies still see abundant opportunities in the country, according to a report by Business China.
After three decades of exemplary growth as a low-cost manufacturing base, today China is grappling with the unfamiliar phenomenon of rising costs. Higher corporate taxes, as well as more expensive labour, land and commodity costs, are undermining the country’s vaunted export-processing model. China is now actively promoting investment in advanced services industries, and is approving fewer foreign companies’ projects. (The State Administration for Industry and Commerce approved 37,888 foreign-funded companies to invest in 2007, down 8.7 percent from 2006.) In fact, even as costs rise, China’s improving efficiencies in supply chains and its growing domestic market are creating new opportunities and generating new client relationships for foreign investors.
One of the most prevalent themes in the Chinese economy has been its ongoing structural shift away from an export-reliant model towards one driven by domestic consumption. Converging factors are responsible for this shift: some are related to long-term economic trends, while others stem from recent implementation of new government policies.
As for the general rise in production costs, foreign companies operating bases in China are less worried; these increases affect them as well as their competitors.
Foreign companies see stricter enforcement of environmental laws as positive. Since most claim to adhere to environmental regulations, stricter compliance by domestic companies would make for fairer competition. “The amount of air pollution we create is tiny compared with the state-owned enterprises operating in the same town,” says one executive who oversees a plant in northern China.
Both minor and major adjustments will be necessary, and many firms are in a constant process of making them.
Zhejiang, China: JF Household Furnishings said its wholly-owned JF Furniture has agreed to acquire a parcel of a land with a total gross area of 42,085 sq m situated in Zhejiang, China at RMB 27.14 million (US$3.95 million) following a successful bid attempt at a private auction.
Construction on the land will commence in or before December, 2008. It is scheduled to be completed before December 2009 for inspection by state authorities. JF Furniture has said that development investiture on the site shall be RMB 18.90 million (US$2.8 million) or above per ha (US$280/sq m).
Beijing, China: FAVA International Holdings Ltd has agreed to acquire the retail business and assets of nine home furniture retail stores in Beijing through its fully-owned subsidiary Huari Hengyu Home Company Limited, as reported by Newstrak Daily.
FAVA signed the takeover agreement with independent third party, Zhou Xu’en. It will pay not more than RMB 35 million (US$5.1 million) towards the deal, payable in four stages. The agreed initial payment of RMB 7 million (US$1.02 million) will be paid within five to eight months after the official documents are completed. The remainder will be paid over three years, from 2009-2011.
Each of the stores covers an average area of 300 sq m. By the end of 2007, annual income and profits of the nine stores were RMB 24.8 million (US$3.6 million) and RMB 4.2 million (US$611,772) respectively, and by the end of March 2008 total assets of the nine stores amounted to RMB 7.6 million (US$1.11 million).
The finalised acquisition amount will be computed at three to five times of the price-earning ratio, according to the audited net profits of the nine stores between April 1, 2008 and March 31, 2009.
Indiana, US: A news release from residential and commercial furniture maker Chromcraft Revington dated June 17, 2008 announced the sudden departure of CEO Ben Anderson-Ray.
Anderson-Ray will step down as Chairman and CEO of the West Lafayette-based company and will resign from the board of directors effective as
of June 30, 2008.
Anderson-Ray said, “At this time it is appropriate for me to step down from leadership of the company to support the ongoing process.” He will take an
advisory role with Chromcraft Revington for 90 days after his departure. He will be replaced by Ronald H Butler, 58, as of July 1, 2008.
Chromcraft is trying to restore profitability. In May 2008, the company reported that sales for the three months ended March 29 was US$27.5 million, a 18.9 percent drop from the prior year. The company said at the time that payments of residential furniture for the quarter were lower primarily due to the weak retail environment, competitive pressures from imported furniture and the impact of restructuring activities at the company.
New York City, US: According to a report on Guardian.co.uk on June 19, 2008, Scandinavian furniture chain Ikea has finally opened a store in New York City, after years of planning and political footwork. By opening a store in the city, Ikea has achieved something that America’s largest retailer, Wal-Mart, has yet to manage.
A queue of enthusiastic customers formed on Monday, June 16, 2008 encouraged by Ikea’s promotion which offered a free Ektorp three-seat sofa
to the first 35 people in line.
“It’s a bonding experience for me and my father,” said Brandis Sanchez, an event host from New York’s Park Slope neighbourhood who was first in the queue with her dad, clutching a complimentary plate of meatballs. The assembly kept busy by playing baseball with an empty water bottle and by hurling blue and yellow beach balls around.
“I’ve been waiting for this day,” said Brandi Turner, a support worker for disadvantaged adults who was 27th in line, “The prices are low,
everything’s good quality and it’s easy to put together.”
New Yorkers are not complete strangers to Ikea; they were able to shop online and an ‘Ikea bus’ to a store across the river in New Jersey has been a popular weekend trip in recent years.
Brooklyn’s borough president, Marty Markowitz, praised the furniture company’s creation of 500 jobs in Red Hook, an industrial corner of the city which used to be a shipyards centre. A donation of furniture worth US$10,000 to local charities has helped win over the community.
“Ikea sells stylish furniture that average Brooklynites and New Yorkers can afford,” said Markowitz, who added that the borough historically had one of the largest Swedish populations.
Ikea openings in London have been notoriously rowdy, once culminating in a mini-riot as shoppers stampeded for cut-price deals. Peace prevailed in New York, policed by wary security guards who provided wristbands and numbered cards to those in line.
London, UK: The Telegraph UK reports that two of the UK’s largest furniture retailers are in discussions with banks and shareholders to raise capital following poor performance by the furniture industry.
ScS Upholstery and Land of Leather have announced plans on how they are going to raise the money they need. Between them, these two retailers control 10 percent of UK’s furniture market. Land of Leather, which has 109 shops, said it is "in the process of finalising an underwritten equity fundraising’. The retailer is thought to be seeking funds of GBP18 million (US$35.5 million) to use as working capital to help it trade through the current slump.
Land of Leather has received "indications of support from shareholders, including its directors, who together hold more than 50 percent of its issued share capital. It is believed to have spoken to around 20 of its largest shareholders sometime around June 11, 2008. The retailer owes trade creditors around GBP 20 million (US$39.4 million).
ScS Upholstery, which has nearly 100 stores, said that it is "working to address" the working capital requirements of itself and its suppliers after a credit insurer withdrew cover from a number of its suppliers. The company, which lost half its value last week after the insurer pulled out, said that it is ‘cash positive with no
net debt’.
The British Retail Consortium said recently that sales of furniture remain “well below” levels seen earlier this year.
North Carolina, US: News-record.com reports that the figures from the furniture industry point towards a slump.
Longtime furnishings industry analyst Ken Smith wants to find a reason for optimism, but his monthly reports all point to gloomy times for furniture businesses. Times are as tough as they have been in decades for the home furnishings industry in general.
New orders in March were 11 percent lower than the same month a year ago, according to the a survey of residential furniture manufacturers and distributors. Year to date, new orders are off eight percent from the first quarter of 2007.
The report also noted that new orders the first quarter of 2007 was five percent lower than the same quarter in 2006, which resulted in a 12 percent decline over the past two years.
For the first quarter of this year, a little more than 80 percent of manufacturers and distributors responding to Smith’s survey report declines in orders from the first quarter of 2007.
Another indicator: Year-to-date furniture shipments are seven percent lower than the first quarter of last year, which in turn were off six percent from the same period in 2006.
A prime reason for the slump of the home furnishings industry relates to the problems with housing sales, said Don Jud, professor emeritus of business administration at the University of North Carolina at Greensboro (UNCG).
“Housing is in the tank right now. People aren’t buying houses, and when they don’t, they don’t buy new furniture. That’s the number one thing,”Jud said.
Anecdotal evidence of strong orders during the recent High Point Market as well as recent reports from retailers of a decent Memorial Day sales weekend have surfaced but the combination of lagging national consumer confidence, slumping house sales, higher gas prices and an uncertain job climate have generally affected the furnishings industry negatively.
Virginia, US: According to a report by the NewsVirginian, Reo Distribution
officials are near to a deal with a Chinese furniture company to establish
a distribution centre for its products.
The deal, along with other company could add up to 200 jobs, according to Tom Sikes, director of global logistics for Reo Distribution. He said it could also increase the company’s revenues by up to US$5 million, or up to seven percent, in the first year.
Representatives from the Songhua Furniture Company in Beijing were in Waynesboro, Virginia in the week starting June 16, 2008 for a third round of talks to move toward an agreement to ship their furniture products to Reo Distribution through its newly established foreign trade zone and from there, to other US companies. Reo officials visited China in April, 2008, and representatives from Songhua were in Waynesboro May 2008.
“We’ve already developed a memorandum of understanding between the two companies,” Sikes said, “We’re here to further negotiate and look at establishing a distribution centre for them and we want to work out some of the details of that agreement.”
Sikes expects that a deal could be struck within one to four months. The distribution center would be in the foreign trade zone, with Reo using existing vacant space.
Alwin Ho, the president of Songhua Furniture, had good things to say about the potential partnership. “I feel very comfortable… with them,” Ho said. He says he has “full confidence” in the potential deal and believes other Chinese businesses will follow suit. Ho’s company has about 300 workers and has been around for nine years, using all natural wood to make its furniture. It also manufactures pre-fabricated homes. If the deal goes through, it plans to ship 100 containers a month to the Waynesboro facility.
Michigan, US: As reported by The Business Journal, Michigan-based La-Z-boyInc has reported a loss from continuing operations of US$7.5 million for the full fiscal year of 2008, following a profit of US$19.8 million in 2007.
It said sales fell 9.8 percent in the company’s fourth quarter, yielding a loss from continuing operations of US$4.5 million for the furniture manufacturer. La-Z-Boy has a divisional headquarters and about 100 employees based in High Point.
CEO Kurt Darrow said the slump in the furniture industry throughout the fiscal year impacted results negatively, while the company use the slump to try to modernise its manufacturing processes, consolidate facilities and sell some operating companies. He noted that over the course of the year, La-Z-Boy had reduced its debt by 31 percent.
“We made tough decisions during tough times, and are confident our business model has the strength and stability for us to remain an industry leader,” Darrow said. Darrow added he does not foresee any significant improvements to the industry business outlook soon. He said the company expects sales to fall by three percent to seven percent next year.
Kentucky, US: Lexington Furniture Industries filed a lawsuit against Bob Timberlake and The Bob Timberlake Collection Inc, leaving the future of the latter in doubt, as reported by the Winston-Salem Journal.
The lawsuit asks that a license agreement between the two not be terminated and that Timberlake pay more than US$140,000 Lexington says that Timberlake owes.
The World of Bob Timberlake furniture collection has been a bestselling line in industry history since it was introduced in 1990. It has generated hundreds of millions in retail sales, including an estimated US$91 million in 2002, despite competition from lower-priced imported knockoffs.
The Bob Timberlake Collection had also ordered and bought goods from Lexington to sell in retail stores or through catalogue orders, the lawsuit says. But Timberlake never paid what was owed, which amounts to US$145,372, according to litigation documents.
This is not the first time that the relationship between Lexington and Timberlake has been tense. The tension initially flared up when the former owner of the manufacturer, LifeStyle Furnishings International Inc, wanted to introduce lowerpriced imports into the collection to generate more revenue. Timberlake said no, and analysts warned that lower-cost imports in the line would dilute the value of the entire collection. However, Timberlake eventually allowed Lexington to introduce two lower-priced imported lines since October 2004.
Arkansas, US: According to a report on KATV7’s website, interest in the benefits and use of environmentally friendly products continues to grow amongst homeowners who are looking to build and decorate their homes in ways that support the environment.
Furniture found at traditional retail stores are often mass-produced and shipped half-way around the world to be manufactured and then shipped again, at least once, before actual sales. Greenminded homeowners look for locally built furniture that is environmentally friendly.
“There are plenty of reasons why people are drawn to this kind of furniture,” says Scott Ekman, Vice President of marketing for Rockler Companies, the national woodworking retailer. “More people are recognizing its environmental benefits as a way to set it apart from the rest.”
Besides requiring less transportationand energy-use, locally produced handcrafted furniture also reduces waste. Through a combination of quality construction and heirloom value, it tends to last longer, easing a huge burden on landfills and other waste management facilities. According to the Environment Protection Agency, furniture and furnishings accounted for over 18 million pounds (8.16 million kg) of waste in 2006, about 3.6 percent of all waste in that year -- the most of any durable good.
While interest in green decorating increases, there is a barrier for homeowners who don’t know where to go to find these types of goods. Rockler Companies have set up a website to match furniture shoppers across the US with woodworkers and carpentry shops in their area.
“We recognised a big void in the furniture industry,” says Ekman. “Handcrafted wood furniture has huge potential, but right now it can be difficult to find. All we’re trying to do is provide people on both sides of the fence with more opportunities to get what they want.”
Baltimore, US: Dormia Inc said on June 19, 2008 that its retail operations have filed for bankruptcy protection, according to a report in the Baltimore Sun. “Bankruptcy reorganization will allow the company to refocus on its wholesale business, Classic Sleep Products, which has experienced a more than 15 percent increase in mattress sales this year compared with last year,” chief executive Michael Zippelli said.
“That’s always been our core business,” said Zippelli, “But the $1,000 to $3,000
mattress range that the Dormia stores sold is down dramatically. Our business
has really been creamed at the store level.”
The housing slump and credit crunch have hit the entire retail mattress industry hard, and costs for the petrochemicalbased foam that Dormia uses in its products in place of coils or springs have soared with oil prices above US$130 a barrel. Mattress sales are predicted to fall three percent this year, after declines in the fourth quarter of 2007 and first quarter of 2008, according to the International Sleep Products Association, the industry’s trade group.
It is a stark reversal from early 2007, when Zippelli promoted plans to expand Dormia’s plant and network of stores. Main Street Resources, a based private equity firm, helped finance that planned expansion. It is owed close to US$120,000, the largest unsecured claim of Dormia’s creditors, according to the bankruptcy petition.
In the filing, Dormia claimed less than US$50,000 in assets and between US$1 million and US$10 million in liabilities for the retail business.
Dormia should focus on marketing its mattresses to competing retail stores that carry a variety of brands, said Wallace W 'Jerry' Epperson Jr, a furniture industry analyst based in Richmond, Va. “They need to strengthen their distribution to go back to those independent stores they may have lost,” Epperson said.
“They never reached a critical mass in the number of stores they had out there.” According to Zippelli sales at some stores, including locations in Tampa and Cincinnati, remain strong. Some of those stores may be sold off or franchised to Dormia employees.
North Carolina, US: According to a news release, the American Home Furnishings Alliance (AHFA) Furniture Foundation has announced it has awarded more than US$64,000 in grants for projects in 2009 to benefit the furniture industry. Since 1990, the Foundation has distributed more than US$3 million in scholarships and grants.
For 2009, the Foundation will award Appalachian State University in Boone, US$24,000 to fund eight US$3,000 scholarships. The scholarships will go to participants in a five-year programme that combines curriculum from the Department of Technology’s Furniture Industry Studies and the Walker College of Business. In addition to an undergraduate degree in furniture manufacturing, students earn a marketing or management degree.
The Foundation also awarded US$20,000 to North Carolina State University. The funds will be used to purchase two SolidWorks 3D mechanical Computer Aided Design (CAD) software packages.
Finally, a US$20,150 grant was awarded to the American Furniture Hall of Fame to preserve previously recorded and transcribed oral interviews from industry leaders. The interviews presently are recorded on fragile, aging cassette tapes. The grant allows the Hall of Fame to convert these to digital recordings.
The AHFA works to promote the growth and global leadership of its member companies, including more than 240 furniture manufacturers and distributors, plus about 200 suppliers to the furniture industry worldwide.
Massachusetts, US: Gardner’s R Smith Furniture store has found a novel way to tackle the weak market, instead of cutting its workforce. According to a report by The Worcester Business Journal, the store is clearing out its entire second storey, consolidating its showroom to the first floor, and inviting local small-scale furniture makers to set up shop upstairs each weekend starting June 21, 2008. “It’s sort of going to be an indoor flea market,” said manager Catherine Carroll.
Carroll said that, with fewer and fewer people willing to travel to Gardner’s wellknown furniture stores, the move is an effort to keep the store viable. She said sales have been down about 30 percent below their usual level in recent months due to rising fuel costs.
The new flea market space, with 120 spaces renting for around US$45 a day, is a response to tough times not just for the store, but for the city as a whole, Carroll said. Remington Arms Co Inc recently closed the local H&R 1817 gun manufacturing plant, and the city’s iconic Nichols & Stone furniture factory plans to shut down completely in July.
With substantial lay-offs, the town’s local stores are suffering. She said the new market is an option for family businesses faced with closure. “They can still sell their wares and do it in a great environment here for relatively little money,” she said.
R Smith is also going in another new direction, launching a web-based store. The company will train its eight full-time and two part-time employees to work on the online operations as well. “Part of the reason that we’re doing these things is so that we can keep our workforce,” she said.
North Carolina, US: Single-source furniture chains did not seem to do very well in 2007. Nine out of the 10 chains on the list of Furniture/Today’s list of Top 100 Furniture Retailers in the US have seen their sales decline.
Apart from Ashley Furniture HomeStores which helmed the roundup for the second consecutive year, all suffered flagging sales. The biggest drop in sales was registered by the nowdefunct Sofa Express and More (ranked 50th). It was down almost 30 percent, making only US$145 million in sales, as compared to US$206 a year ago. La-Z Boy Furniture Galleries (ranked nine) saw the largest net volume decline: sales fell by US$96.8 million to US$924.3 million, compared to previous year figures of US$1,021.1 million.
Another segment that was not ringing up the tills as much as before: bedding specialty stores. For years, they dominated sales and store growth figures. In 2006, bedding specialty stores in the Top 100 had a combined 3.4 percent sales increase, compared to the 0.5 percent average growth across the board. The bedding specialists are beat this year by the Top 10 (4.9 percent sales increase) and the lifestyle specialists (sales up 4.3 percent).
In part due to rising fuel costs, 2007 was a bad year for US furniture retailers. Compared to 2006, when only 26 of the list posted sales declines, 56 of the Top 100 list compiled by Furniture/Today suffered the same fate, 15 of these 56 in the double-digits. Eric Foucrier, President of Linder’s Furniture, commented on the oil-price spike, “Gas prices affected our customers. It’s our customer’s bloodline and it’s tough. There are issues everybody is struggling with right now.”
However, it’s not all gloom: budget furniture retailers saw their fortunes rising. Scandinavian furniture retailer Ikea managed to jump one spot to number two, aided by its addition of three large stores and growing US sales 14.7 percent to total US$1.79 billion. Bob’s Discount Furniture moved a massive 10 positions to take rank 20th, on the back of a 27 percent surge in sales amounting to US$418.1 million. While not in the Top 50, Mexico based FAMSA, leaped 15 positions to take the 60th spot (sales up 24.5 percent to value US116.7 million).
North Carolina, US: The Board of Directors of the International Home Furnishings Center has announced that Tom Mitchell has been named President and CEO of the IHFC, effective July 14, 2008, according to a press release dated June 25, 2008.
Tom Mitchell is a seasoned professional in the home furnishings showroom business. In addition, Mitchell has a wealth of knowledge concerning the International Market in High Point, the exhibitor base and the function of the bi-annual event.
Mitchell has been well known to several members of the IHFC Board for many years. “It is with great pleasure that IHFC welcomes an individual of such great character and integrity into our Company,” the Board stated.
Opening in 1921, IHFC was the original showroom building in High Point and after 85 years of expansion, it remains the centrepiece of the world’s largest home-furnishings trade show that attracts more than 90,000 participants twice a year to 2,600 showrooms covering 11.5 million sq ft (1.07 million sq m). IHFC alone is home to 650 of the leading home-furnishings manufacturers, including 13 of the top 20 companies, and covers 3.5 million sq ft (325,160 sq m).
Singapore: Takao Sugioto, previously Senior Managing Director of International Development Association of the Furniture Industry of Japan (IDAFIJ) has retired from the office. He has thus also asked to be relieved of the title of Editorial Advisor for Furniture & Furnishing Export, International (FFE). The editorial team at FFE would like to formally record its appreciation for and express thanks to Sugimoto’s support for the magazine. We wish him every success and happiness in this new chapter of his life.
Eurosa: X For Style
The Rect Dining table comes with an additional style element: its legs are fashioned from stainless steel in an X, keeping in line with the Eurosa’s effort to create something ‘elite and elegant’. It is constructed of solid Elmwood and the chairs feature a fur back and polyurethane foam seat. It can be upholstered in fabric and leather, catering to individual preferences.
Deep: Classy Dining
The Sydney breakfast table from Deep is also suitable for use in the study. Its special storage rack can store anything from dining needs to study knick-knacks. It features a concealed glass holder and an easy for wine storage.
Koda: Fine Bamboo
Inspired by the modern Asian aesthetic, eco-friendly Hiro collection is made of bamboo. It is crafted from responsibly forested, renewable bamboo. The material is famed for its strength and is more scratch resistant than steel. Highlighting bamboo’s natural beauty, its honey colour finish reveals bamboo’s natural grain.
Bowlman: Princely Meals
From Malaysian manufacturer Bowlman, the Princeton dining set is an eye-pleaser: With its cleanly designed table and chair legs, it is suitable for modern urban homes.
Satoshi Asakawa: Think Thin
The Thin Chair ver.5 was presented at SaloneSatellite 2008 as a tribute to minimal and sensitive design. Designer Satoshi Asakawa has been working on the comfortably thin table and chair set since 2004. This version is created by bending just one sheet of steel.
Omega: Simply Modern
The KH-105 is a special promotion item that comes in either full leather or half leather and half PVC. It is designed for a simple and modern look using tropical hard wood, zigzag spring, as well as high density and resilient foam.
Tacchini: Love Simplicity
The pursuit of the Swedish designer Monica Förster is characterised by a love of simplicity united with a desire to reinvent everyday objects, taking inspiration from nature, fashion and art. Belly is a large sofa of pure, distilled form with a wood and steel structure. Its comfort and originality are derived from its elastic belts that bind the large cushions to the ample back; the padding covers the expanse in a variety of shapes, defining the seating space in a distinctive manner.
Blu Dot: Linear Cleanliness
From Minneapolis furniture designer/retailer Blu Dot, the Swept Sofa is constructed from a brushed stainless steel base and upholstered in what they call a ‘super-fibre’ leather alternative.
Misura Emme: A Fine Balance
The Borderline sofa is a hymn to lightness. The sofa with elegant support in glossy steel and the novelty of the terminal element, can be upholstered both in leather and fabric. A true balance between refinement and modernity that renders the sofa suitable for different lifestyles.
Arflex: Italian Classic
The Delfa’s metal structure is covered in high capacity differentiated density polyurethane foam. Back and armrests, also with metal structure, are covered with moulded flexible polyurethane foam.Back- and arm-rests come with spring mechanism. Seat cushion are made of goose down.
Chanel Sofa: Plush Comfort
The soft cuddly comfort of Marianne is beautifully designed; with immaculate stitching it has loads of style. It is durable, resilient yet quietly provides plush seating comfort with the use of a combination of pocketed springs seats plus high density polyurethane foam.
On.Air: Sofa So Good
The on.Air sofa is characterised by the curved and continuous contour of the seat which contrasts with the linear back and useful lateral system stand. It contains an air bed with a base and mattress. Converting from sofa to bed in matter of minutes, it requires minimal effort as the inflator is powered by an electric motor.
Vitra: Work On A Sofa
The Worker Sofa was created by Hella Jongerius primarily as a communicative piece of furniture that would be well suited to the kitchen, conservatory or reading room. Due to its compact dimensions, comfort and the light-hearted detailing that is typical of Jongerius’ work, the Worker Sofa also makes a good impression in the living room or lounge environment.
Ercol: Oak Goodness
Napoli combines solid bent oak frames with elegant tailored upholstery, available in both low and high back versions to offer all seating options. It is designed by Sean Dare and coordinates particularly well with other oak ranges, Lucca and Artisan.
Polaris: Minimalist Offer
The Malaga Leather Sofa Collection of 2-Seater, 3-Seater and armchair are all designed to accommodate the human body with studied proportions and simple geometry. The gentle angling of the backrest, full seat depth, and elevated armrests are eminently suited to living rooms or reception areas. Boerne’s signature artisan details are evident throughout these handcrafted pieces. A gleaming chromed steel base runs the entire depth of the design.
Kian: Sunny Leisure Boat
From the company and designer that brought us the award winning matryoshka set, Kian’s Danny Fang brings us the new Sunboat collection. The Sunboat lounger is made of strands of colourfast resin hand woven around a sturdy powdercoated aluminium frame.
Mamarou: The Great Outdoors
Moccar is a garden seat by Japanese fi rm Mamarou. Offering three modes of function: lying-down, sitting and swing, it comes with a foot stool for added comfort.
ENEA Studio: Whimsical Fun
‘Swing’ is a suspended seat for adults. Inspired by falling leaves in autumn, the piece is designed for the outdoors. Its designers recommend placing the Swing in an area where sunlight filters through to emphasise the beauty of the seat’s cut-out areas.
Riva 1920: Comfy Nugget
Maui Armchair by Terry Dwan is crafted from scented cedar wood. The 75 cm diameter outdoor seat is hand finished to its sinuous form, heightened by the concentric circles of the cedar trunk. Its makers; Italian company Riva, says the piece is suitable for both indoor as well as outdoor use.
Merry Price: All Weather Wicker
This is the company’s latest all weather wicker products suitable for garden and the seaside. It is made of 100 percent recycled non-toxic polyethylene (PE) fi bre ‘VIRO’ material. The frameworks consist of solid Balau tropical wood or aluminium framing.
Komplot: Rub In The Rubber
Copenhagen’s Komplot Design brings us the Rubber Chair, with rubber and spring bands that can fit the body contours of any person. Its geometric angularity makes for an elegant outline in whatever setting. This chair is ideal for outdoor use because it is waterproof, and stackable for easy storage.
AVL: Outdoor Set
Made of splinter free natural wicker, the Classic Wicker Set from AVL is durable and reliable and it is easy to clean. It is mould and mildew resistant, as well as fade resistant and can withstand a large range of temperatures.
G-led: One Piece Wonder
Mobyrak is an experimental bench made from certified plywood. The bench is made of only one piece of material, cut and assembled into the outdoor furnishing.
Hannes Gump: Airy Delight
Weatherproof and suitable for outdoor use, ‘Hollow’ is an abstract approach in furniture. It is made of a single sheet of metal, laser-cut and bent in two directions. Because of the shape of the design, construction material can be switched to fancy.
Pudelskern: Outdoor Lounging
Calla is a lounge chair to be used in and outdoors. Different versions can be produced according to requirements: integrated heating, lighting and even loudspeakers for the musically-inclined. There is also one special version of Calla that will sport Swarovski crystals.
Tina Roeder: Collectible Nostalgia
Berlin-based designer Tina Roeder presented the ‘White Plastic Chair’ during her first solo show at the International Furniture Fair, April, 2008 in Milan. They are a series of found old garden chairs found since 2002. The chairs are individually perforated and sanded in order to give each one new life.
Kenneth Cobonpue: Modern Rustic
From internationally acclaimed Filipino designer Kenneth Cobonpue, the Lola armchair is signature Cobonpue. Creating modern design from traditional materials, Lola is suitable for outdoor use, being resistant to moisture. Its airy design also makes it an ideal piece for balmy tropical climes.
Russia: A New Market Emerges
As furniture consumption in the US slows, Russia’s emergence is increasingly noteworthy. Ikea leads the pack of exporters and retailers who are looking to tap on a booming consumer market that could be worth US$8.68 billion by 2011.
By Nicole Liang
When Ikea announced plans to open 10 furniture mega malls in Russia, it was more than just a statement of grand entrance by the Scandinavian furniture giant. To foreign exporters looking for new markets to grow into, Ikea’s move signalled that Russian consumers are growing more affl uent and willing to spend on home furnishings.
Indeed, it is estimated that the Russian retail sector would grow 84 percent to US$745 billion by 2011. And by 2012, Russia may even become Europe’s second largest retail market, beating the UK or Germany. Euromonitor expects sales value of home furniture to grow by 38 percent from 2006 to reach RUB 2.05 billion (US$8.68 billion) in 2011. Housing development would be the biggest fuel behind this growth and could possibly record above-average medium-term growth of 12 percent per year, according to The Economist Intelligence Unit’s Business Eastern Europe report.
A quick glance at Ikea’s global presence further presents an approximation of Russia’s lucrative potential. Worldwide, the Netherlands-based maker/designer of reasonably priced and well-designed furniture owns 247 stores in 24 countries (excluding franchises). Going by the existing number of Ikea stores per country, Russia is ranked among the top 10. It also has the most number of new openings in the pipeline, putting it on par with the US. Said Per Kaufman, chief executive of Russian operations for Ikea to Management Today: “It is a bit like the Wild West a hundred years ago. There is such demand and dynamism in the market that you can succeed even if you’re not the top retailer”.
Kaufman’s outlook is spot-on. In 2001, total sales value of furniture was RUB 56.47 billion. By 2006, this fi gure grew by 163.6 percent to RUB 148.84 billion. Ikea’s market share (according to retail value) was 5.3 percent, just second to Russia’s Mebelnaya Kompania Shatura. It did not have to be the top retailer to be a winner.
Ikea’s retail model in Russia also hit a home run. In terms of distribution formats in the Russian furniture market, more than half is accounted by furniture and furnishing stores. Mixed retailers and DIY/hardware stores take up 19 percent and 7.9 percent respectively. Combining the two most popular ways to distribution, Ikea’s mega mall concept has proved exceedingly attractive.
Already, its total store count has reached 11, with the May 30 opening in the Takhtamunaysky district of the republic of Adygeya, southern Russia, as Ukranian News Digest reported. With a total fl oor space of 27,800 sq m, the mega mall, like its predecessors, operates as a shopping and entertainment complex. Within, 56 variations of furnished interiors are presented. According to the report, the latest project was worth US$168.4 million.
That is not the end of it. The contemporary furniture retailer plans to further pump in US$600 million to build another four Ikea stores and mega malls in the cities of Ufa, Omsk, Samara and Krasnodar. According to a report by Prime-Tass News dated March 20, each of the four premises will occupy over 100,000 sq m. A concrete timeline for these four additions was not given. Ikea did, however, add that it would in October begin construction of a US$192 million, 140,000 sq m mega mall in the Volgograd region. The launch is expected to take place in March 2010, according to Prime-Tass News’ report on January 29.
Some local retailers have expressed concerns over the foreign brand, which is fast gaining popularity and has its eyes set on the Russian market. Despite this, Ikea, with three woodworking and furniture production plants within Russia, still has much catching-up to do. According to the Furniture Association of Russian Manufacturers, local furniture companies in 2006 accounted for up to 60 percent of total retail sales. Euromonitor factors this to Russian manufacturers’ strength in establishing their own retail chains and opening specialised branded furniture stores to increase their distribution and retails sales, both in central and regional markets. This meant shorter delivery time.
Nonetheless, there is substantial demand for imported furniture and furnishings. Medium- to large scale Russian Federation companies produced RUB 75.14 billion (actual price) worth of furniture in 2007. Exports of furniture and furnishings recorded 123.8 percent growth to US$467.58 million in the same year. Demand at home, clearly not satisfied, has increasingly been looking to imports.
The First Independent Rating Agency’s fi gures show that furniture and furnishings shipments rose by more than 160 percent year-on-year from 2006 to reach US$2.1 billion. It favoured an interesting mix of countries offering a range from mass-market to design-focused products. This could be attributed to the fact that that there had been a vacuum of affordable furniture according to The Economist Intelligence Unit. As such, Russia’s border neighbour, China, was its biggest supplier of imported furniture, recording US$437.42 billion.
At the same time, there is a need for higher-end furniture among the emerging Russian middle class grows. Euromonitor also observed that almost 95 percent of Russian furniture is based on foreign designs and are often out of fashion.
Demands for more design-centric products from Germany shot up by 231.9 percent, though it still trailed behind Italy, which accounted for about 19 percent of the total.
Within Italy, exporters in Tuscany are reportedly enjoying increasing demand from Russian buyers. Their exports to Russia went up by 25 percent year-on-year in 2006 to US$63.6 million. These fi gures, as reported by the ANSA - English Corporate News Service on November 21, 2007, suggest that Russian customers esteem Tuscan furniture for its quality, attention to detail and the types of materials used, as well as its craftsmanship.
According to the President of the Salone Internazionale del Mobile, Rosario Messina, Italy can count on the fact that it has the best furniture makers and products that are known worldwide for their quality, fine finishes and excellent designs. The international mix of visitors and 2,450 exhibitors has spoken volumes of the pedigree of the fair.
Held at the Milan Fairgrounds in Rho from April 16–21, iSaloni closed with a record 348,000 visitors, a rise of 29 percent from 2007. Of those, 210,000 fl ew specially into Milan for the fair. Many were drawn to its two most exciting offerings: Salone Internazionale del Mobile and SalonSatellite. These two segments showcase new collection launches from renowned designer labels and out-of-the-box prototypes from young designers, respectively.
SaloneSatellite is a prestigious annual competition for budding designers. This year alone, it received up to 1,000 entries. Alongside their main entries, participates are required to comply to the overarching theme, viva il verde! Go Green! by creating an annex dedicated to green design.
Viewed as the venue that “anoints” star designers, the selection process is extremely strict and competitive, to the extent that fewer participants were deliberately accepted than in previous years in order to maintain its exclusive reputation. This edition was judged by a prestigious Selection Committee which includes Ferrucio Laviani, architect/designer; Silvana co, Director, Design Museum, Milan; and Giulio Cappellini, Artistic Director, Cap Design SpA.
Armani/CasaA graphic statement by itself, this limited edition chaise lounge exudes an aesthetic sophistication with the juxtaposition of its beige linen and impressive arm rests clad in Makassar ebony.
Poltrona FrauIts openness symbolises a comfortable living area. Designed to last, the structure and feet are formed from rigid polyurethane with a metal insert. With comfort as its priority, the cushion is padded with polyurethane foam and polyester wadding. The sides come in bent plywood panels coated in an oak veneer.
CappelliniAn aluminium chair that folds upon itself to conserve space in a small studio. This product comes in white blue, yellow, grey, red and black. It also comes multicoloured.
PorroCreated for smaller dining rooms, Synapsis’s square form and dimensions ensures the same elegance of the original sinusoidal version on a reduced scale. A transparent support with a square base of the chromium-plated or white-painted steel rod appears inconsistent to the eye and renders an ethereal atmosphere. It comes in mongoi or ‘carbone’ oak.
ZanottaA modular sofa, the monobloc is designed for versatility and will fit into any corner of an apartment. Its ABS nonvisible feet are interchangeable upon request. Upholstered in graduated polyurethane/Dacron Du Pont, it is given a plush feeling. The external cover is removable in fabric or leather.
e15Emphasising adaptability and individuality, this Persianthemed sofa set utilises the ability to combine various backrests with different seating elements to create different moods, be it formal or causal. The handmade slatted finishing of beech wood and different layers of cushioning ensure comfort in style.
Box Chair / Child’s ChairThe Child’s Chair’, made from 45mm Ash and 12mm painted MDF, offers seating for both adult and child, whilst also acting as a seat and play surface for a child. Eiry’s deisngs lean towards the parent-child relationship between objects and how objects become dependent on each other in order to exist.
VagoAs an indefinite object, Vago can be a stool, a magazine rack or a table if joined. Playing upon generation, complex shapes can be created depending on the aggregation thus overcoming the initial inertia of the arrow shape.
WoodenlegsThe name Woodenlegs refers to the feet of the lamp. Its design is a combination of two traditional techniques and materials: metal spinning and the woodworking of oak. The cap of the lamp is obtained through a high-speed rotation of a single sheet of aluminium.
HOFWith the aim to create a small and simple set of furniture that allows for optimal positions for reading and relaxing, the designers worked with a physiotherapist to try and work out all possible positions. The bicoloured nature of HOF underlines the ever-shifting image of the furniture as one views it from a close distance.
SpaceBy a simple motion and a switch, the bed disappears into the ceiling, leaving a 40 percent increase in space. Viewed as a solution to a practical demand for space in increasingly small rooms, the bed allows for the freedom of imagination, the luxury of space.
Bower TableInspired by the ritualistic collections of the Bowerbird and the form of its nest, the designer kept material wastage to an absolute minimum during production. The frame and the top are cut from a single sheet of acrylic. The outer ring is thermoformed to become the frame and the inner blank, when rotated 45 degrees, is placed upon the peaks of the frame to form the table surface.
A Glimpse Into The Year Ahead
The annual Best of NeoCon awards, given out before the show opens, offered a glimpse into what’s hot in the corporate setting for the year to come.
At the NeoCon World’s Trade Fair (June 15-17), visitors discovered thousands of innovative products and resources for corporate hospitality, healthcare, retail, government, institutional and residential interiors from more than 1,200 showrooms and exhibitors. On top of that, the annual Best of NeoCon awards, given out before the show opens, offered a glimpse into the what’s hot for the year to come.
A total of 352 product entries were received across 39 product and furnishing categories. On June 9, some 72 awards were given out. Four Innovation Awards and a Best of Competition Award were also selected. The Files and Storage Category took the top prize as the Best of Competition with Teneo, manufactured by Herman Miller and designed by Birsel+Seck.
The Best of NeoCon jury is composed of 53 corporate, government and institutional facilities management executives, interior designers, and architects. Manufacturers or product designers had the opportunity to explain and discuss details of the entered product and answer jurors’ questions.
Best of CompetitionBy Herman Miller, Inc Files & Storage category
HÃ…G SidewaysBy HÃ…G by izzy Conference Seating category
NC-B ResonateBy Haworth Files & Storage category
VeryBy Haworth Stacking Seating category
C:scapeBy Steelcase Furniture Systems category
Brit Bench MetallicBy Leland International Benches category
CobiBy Steelcase Conference Seating category
Scala & PlannaBy Inscape Furniture Systems category
TavolaBy Nucraft Conference Tables category
FreeboardBy Anatome Office Accessories category
Mugna (meaning creation) Awards saw entries from young designers alongside veteran designers. The Philippine furniture industry is fortunate that it has a pool of emerging designers that will fuel its drive to enhance design and R&D to make pieces that are creative yet environmentally sustainable. Here are the awardees:
Mugna Citation For Outdoor Furniture
Sunset Lounge By
Klemens Huls For Eurowood Products & Techniques Manufacturing Corp
Mugna Award For Best Furniture DesignInfinity Collection By
Allan Murillo For Murillo’s Export International
Mugna Award For Best Student DesignPandora By
Maria Luz Mikaela Cano For Kristen International
Mugna Citation For Design MentorshipPresented to Kenneth Cobonpue
If crises were a time when heroes are born, then Herman Dexter Home Furnishings is an opportune winner. The home-grown furniture and furnishing retailer opened its fi rst store in end-2001 in the Jakarta Design Centre when the country was plagued both by political and economic woes.
“Indonesia was going through a rough time then. But that was also our best time to enter because existing players either moved out of the country or closed down completely. This created a void for us to fi ll because people will always need furniture and accessories, sooner or later,” said the company’s director, Parlin H Widjaja.
And of the surviving few who persevered, there was hardly any competition to speak of since almost none of the local names matched the kind of product variety and solutions that Herman Dexter offers. “In order to do well, one must offer everything from relevant products to value-added services,” Widjaja added.
“Doing well”, however, may be an understatement for what Herman Dexter has achieved and within such a short time. With less than a decade’s history to boast of, Herman Dexter’s market standing in Indonesia’s furniture retail milieu has grown surely but far from slowly.
As one of the largest Indonesian players today, the market leader now has 13 stores. From the humble beginning of a 200 sq m retail area in Jakarta Design Centre, its fl oor space now totals 16,150 sq m nationwide in Jakarta, Bandung, Medan, Pekan Baru, Purwakarta and Surabaya. Among these, eight are large-scale ones, each covering more than 2,000 sq m. In addition, another is set to open in August this year.
One of these services includes hiring interior designers commissioned to dispense free consultation to consumers. Each of the smaller stores has around five designers while bigger ones have about 40 designers stationed within. This service is extended not only to customers who have purchased items in the store, but also to potential ones who have yet to decide on buying. On top of that, Herman Dexter’s interior designers do not just offer suggestions on paper. If required, they make house calls too.
These interior designers make up part of Herman Dexter’s creative team, which also includes product designers, who help produce new designs every three to four months. Herman Dexter’s largest store features up to 4,000 items, including over 200 models of modular furniture. Customers can make combinations that work for any part of the home – a characteristic which Widjaja counts as Herman Dexter’s point of differentiation from competitors. “They are only limited by their imagination. Different mix-and-matches can end up with very diverse functions. This is why our cabinet doors are all interchangeable,” Widjaja said.
In order to keep up with constant renewal and updates of such wide variety, Widjaja works with 100 local and foreign suppliers, sourced through various channels and media. “The suppliers must have quality, flexibility and responsibility,” he added.
To serve the slightly higher end market, some pieces are brought in from Denmark and Taiwan. Most of the products, however, are imported from China and Malaysia for the mid-end range.
Herman Dexter’s buying pattern is very much like the Japanese who are famed for their nit picking – the meticulous and cautious attitude towards new contacts. Almost as a rule of thumb, Widjaja seldom places orders at the fi rst meeting with keen suppliers. From getting-to-know to getting-down-to-business, the process usually takes two to three years. Widjaja says this is especially the case when working with Chinese suppliers: “At the very least, if the company still exists after a couple of years, it should to some extent have some reputation and reliability”.
As an added precautionary measure, Herman Dexter regularly sends its own QC personnel to suppliers’ factories to ensure that the goods are in order. “We believe in long term working relationships, however if a supplier sends defective goods regularly, we will stop working with it,” Widjaja added.
Apart from China and Malaysia, local OEMs are also Herman Dexter’s major suppliers. According to Widjaja, Indonesia is a large country and preferences vary from antiques, solid, ethnic, to modern. Also, he shared that most of the stores in Jakarta feature items that are usually of lighter colours. Consumers in Medan, for example, prefer darker colours. Its in-house product designers and local OEMs can address these demands effectively and quickly.
Surprisingly, Herman Dexter’s salespersons are also required to possess a design background. The company offers regular trainings in this area. As Herman Dexter also takes on contract furnishing projects as well, salespersons handling these accounts must also have lobbying skills, according to Widjaja. Herman Dexter’s business-to-business clients include those from hotels, restaurants, cafes, hospitals, schools, libraries, etc.
Spotting bright but warm interiors, Widjaja ensures that all showrooms exude elegance, even though the products are largely affordable. These messages are conveyed frequently to its targeted consumers. Catalogues listing new designs and promotional items are mailed out monthly to members and selected residencies. The membership programme, debuted four years ago, works with a few banks to offer discounts when customers make payment with the partner bank’s cards. Exhibition events targeted at consumers are held regularly at the concourses within shopping malls in which Herman Dexter stores can be found. Entertainment activities will be staged to attract consumer interests.
According to statistics released by the China National Furniture Association (CNFA), China’s furniture industry recorded a trade surplus of US$22.51 billion in 2007. This represents a year-on-year rise of 48.9 percent from US$15.6 billion in 2006. Export value rose by 29.5 percent to US$22.6 billion while import value experienced a growth of 37.68 percent to US$1.1 billion.
Leather futons saw an exponential increase in import value of 560.58 percent together with a rise of 237.29 percent in volume. Considering that only 199 units were imported at the price US$848.88 apiece, this trend can be explained by the growing affluence of the Chinese population. Such an increase in spending power, and therefore an increase in aggregate consumer demand, could also account for the triple digit growth in the bedroom furniture segments. Rosewood bedroom furniture posted a rise of 159.99 percent in volume and a rise of 308.48 percent in value.
Overall, most furniture segments recorded an increase in both export and production value. Wooden furniture produced the strongest showing with an export value of US$3.02 billion (+13.06 percent) for 115 million units (+11.31 percent). Yet although within the same segment, the rosewood bedroom sub-sector suffered a disappointing fate. It saw a decrease of 23.91 percent in volume, shipping only 6,079 units. A marginal increase of 2.72 percent in value was posted. Other rosewood furniture also fared badly. A 19.46 percent drop in volume and a 7.93 percent drop in revenue resulted in the segment taking in only US$10.95 million in terms of export value.
Metal furniture retained its position as the top three contributors to value. An export value of US$2.87 billion, with 268 million units shipped, was reported. Clearly, in terms of unit price, the export of wood-based furniture is much more lucrative as compared to metal-based furniture. The unit price of wood-based furniture works out to US$26.29 on average. For metal-based furniture, the unit price stands at US$10.72.
Following metal furniture, metal-framed seat furniture takes third place with an export value of US$2.19 billion, an increase of 36.13 percent. Some 222 million units were exported, an increase of 18.18 percent from the previous year.
Both in terms of export volume and value, the surprise performer was the leather futon segment with three-digit growths. Volume and value went up by 108.77 percent and 240.95 percent respectively. Non-leather futons experienced a similar growth squirt with a 146.07 percent increase in volume and a 133.04 percent increase in value. The aircraft seat furnishing segment also performed exceptionally well with a reported growth in value of 302.11 percent. Combined with a 46.77 percent growth in volume, 21,744 units were thus shipped for US$11.50 million. This translates to a unit price of US$529.12, one of the highest in the furniture trade segments.
Guangdong continues to lead China in furniture exports as it did in 2006. It contributed a total of US$9.17 billion, accounting for a massive 40 percent of China’s total furniture exports. A year-on-year growth of 30.01 percent was posted.
Zhejiang ranks second with US$4.34 billion (+39.9 percent) while Shanghai comes in third with US$2.31 billion (+32.33 percent). Fujian and Shandong followed with an export revenue of US$1.36 billion and US$1.05 billion respectively.
Three provinces underwent triple digit growth. Jiangxi’s furniture export value increased by 157.95 percent, Sichuan reported a 151.35 percent increase and Hunan saw a 122.30 percent increase. However, these provinces still have much to improve upon. Even with export revenues combined, these three managed only US$120.12 million, which is a measly 0.013 percent of Guangdong’s output.
On another note, Ningxia posted a decline of 41.91 percent for an export revenue of US$300,000. Similarly, Hainan and Shanxi saw negative growths of 13.36 percent and 27.91 percent for export revenues of US$47.63 million and US$3.29 million respectively.
Rarely is there such consensus and certainty among economic forecasters and industry insiders. This widespread agreement about market conditions may turn out to be a great advantage for the furniture industry
in the coming year. There are no divergent, rosy forecasts for manufacturers or retailers to hang their hopes on in 2008, so now the collective focus shifts to responding to these challenges and building better businesses despite them.
“Maybe we’ll get lucky and have full bore recovery, but I doubt it,”Dugan said, “if we do, we will make the best of it, but for planning purposes, the smart thing to do is assume business will be tough, very tough, and plan accordingly.”
That’s just the approach that many companies are taking. At Doerr Furniture in New Orleans, the outlook for 2008 is pretty good because many people who were displaced by Hurricane Katrina are finally returning, moving into new houses and furnishing them.
“We’re in something of a bubble here,” said Julian Mutter, chairman of the family-owned furniture store. “I’m still doing double the business we did pre-Katrina. For the two years immediately after the storm, our sales volume tripled. Our projection for 2008 is that we’re going to still enjoy the business that we have enjoyed for the last trimester of 2007, which is still significant and higher than before Katrina. We think that we will enjoy the kind of business that we’re enjoying right now for another two to three years. For any merchant, I’d say whatever business you’ve been doing for the last four months, I think 2008 is going to be pretty much the same.”
At Doerr Furniture, at least, that means business will be good in 2008. But Mutter isn’t taking anything for granted, and he’s running his business as if the outlook were much less optimistic.
“I always say, 'Run your business as if you’re in a recession because if you do and you’re not in a recession, you’re going to make that much more money',” said Mutter, who is also chairman of the Home Furnishings Independents Association.
Indeed, many companies are talking about doing some belt tightening of their own, just as they expect consumers to do in 2008. “I don’t think any home furnishings retailer has ever been frivolous in their expenditures, but this just gives you another reason to keep an eye on things,” said Janice Chamberlain, research editor for Home Furnishings Business magazine.
Manufacturers are doing the same. Carrie Craymer, owner of OurHouse Designs, has set her sights on 10 percent growth in 2008 despite rising leather prices and repressed consumer demand for furniture. Everyone at the Hickory-based leather manufacturer, including Craymer herself, will have to work harder to achieve that goal and match 2007’s growth rate. Amid all the economic worries, Craymer also finds herself scrambling for alternative sources of leather. Many of her suppliers are also manufacturers, so they get first dibs on the leather hides they produce.
In addition, the fashion, airline and automotive industries will often pay more for raw hides, putting furniture makers like OurHouse Designs at a distinct disadvantage when supplies are tight.
“It’s the first time I’ve really been frightened that we can’t get our hands on the crusts,” Craymer said. “It’s almost like a lot of these leather suppliers are competing with you. They’re selling you the raw hides and they’re also manufacturing it. We’ll definitely have fewer suppliers in 2008, but they’ll be more meaningful. And we’re going to look harder at those suppliers who have their own manufacturing facilities.”
Craymer adds that she will find new leather suppliers to her already long to-do list, while her employees will be taking on more duties, as well. At OurHouse Designs, production workers function as a team, and most are cross-trained on multiple jobs. For example, the company no longer has leather markers and leather cutters. Now, workers are trained to do both tasks-a manufacturing shift that has saved both money and time. In addition, instead of having dedicated inspectors, employees at every step in the production process inspect their colleague’s work.
“You have to work leaner and smarter,” Craymer said. “We’re always trying to ask, ‘how can I do it better?’“ On the surface, a company like Craymer’s privately-held OurHouse Designs and the publicly-traded conglomerate Furniture Brands International couldn’t seem more different. But the two furniture businesses are taking strikingly similar approaches this year-control what you can.
“We all know we can’t do anything about energy prices, housing starts, consumer credit, consumer confidence, any of those things, so don’t expect to hear us complain about how those may or may not affect our business,” Ralph Scozzafava, the newly installed CEO at Furniture Brands, said in a conference call. “We plan to focus on the things that we can control, and that includes four variables: availability of the right products for consumer, having the right space on the showroom floor with our retailers, how we merchandise with our retail partners, and then how we price our product together.”
“Furniture Brands will focus on boosting its brands, satisfying retailers, delivering operational excellence and training and developing employees in 2008,” Scozzafava said.
On the brand front, Furniture Brands will leverage a variety of sales channels, including traditional furniture retailers, mass market retailers, dedicated showrooms and interior designers to “Put the right brands in front of the appropriate consumers,” Scozzafava said.
“We’ll also strengthen our brand by improving our product development process,” he said. “Deciding what new models and styles to bring to the consumer is as much art as it is science, but we’re going to be more rigorous in that process. Having a higher percentage of our new models that are hits with consumers strengthens the value of our brands.”
In order to improve relations with retailers in 2008, Furniture Brands will work on improving product availability, pricing and retail merchandising. Operational changes will result in shorter lead times, better inventory controls, fewer consumer returns and a reduction in SKUs. “We’re transforming Furniture Brands from a holding company to a more efficient operating company model,” Scozzafava said.
The company’s employees will play an important role in that transformation and they’ll be rewarded for moving the company forward. Miskelly Furniture, a Mississippi-basedretailer, also recognises the role that employees play in the furniture sales equation. That’s why the company continues to reinvest in its staff through traditional methods like training and development, as well as perks. At its flagship destination store in Jackson, Mississippi, Miskelly Furniture recently built a state-of-the-art break-room for warehouse workers and
delivery drivers.
While some businesspeople might balk at undertaking an expensive project like that in a tight economy, Tommy Miskelly considers the outlay a necessary investment in his employees and his business. “if we give our employees the tools to succeed, we’re going to be a very good company,” he said. “We’re only as good as the people who work for us. If we don’t reinvest in them, then we’re in trouble.”
Rather than cutting spending, the Top 100 furniture retailer invested in a revamped website, an expanded warehouse and a new customer-care call centre last year. In 2008, the company, which operates two stores, will open an Ashley Furniture HomeStore, as well.
Miskelly is projecting that sales at his company will be flat in 2008, but that doesn’t mean that profits will be. “Now is your time, I think, to put your pedal to the metal,” Miskelly said.
Through a combination of strategic business decisions and savvy, if offbeat, marketing moves that have cost millions, Miskelly Furniture has transformed from a traditional furniture store to a shopping destination for the whole family. In addition to furnishings, the flagship Miskelly store has something to capture the attention of every member of the family: a sports museum, a carousel, a Noah’s Ark story area for kids, a basketball court, a movie theatr and a cafe”
Though the store has added many entertainment features, the shopping experience still focuses on furniture and how it helps define home. “We’ve got to make it fun, so customers want to come here,” Miskelly said. “When customers come here, they’re enhancing and investing in their home, in their life. I think maybe in this industry we talk too much about price. We don’t talk enough about what this item can do for your home, how it can make your family closer.”
Like many in the industry, Miskelly Furniture is strengthening its advertising position in the coming year as a way to stay at the top of consumers’ consciousness. Most industry watchers agree that advertising becomes more important, not less, during an economic downturn. Companies can save money on advertising by targeting their ad buys, asking for better rates and by making sure that the creative message is on target. But cutting ad spending is generally not a wise move.
“One of the merchants in my market throttles his advertising back if business is slow,” said Julian Mutter of Doerr Furniture in New Orleans. “He’s basically fishing only when the fish are biting.”
Whether by cutting costs or investing wisely for the future, manufacturers and retailers are trying to attain the same goals in 2008: survive the economic downturn and become a better company in the process.
“When things are good, you can do no wrong. You can overcome the dumb decisions,” Tommy Miskelly said. “When things are tough, the trees get shaken a little bit. I think in the end, [going through a downturn like this] is going to make you a better company, and it will probably thin out some companies that don’t belong.”
As with any business cycle, this one is sure to turn around. Of course, there will be the inevitable fallout-additional corporate bankruptcies, management shake-ups, store closings, tight margins and falling stock prices are possible. Some furniture retailers and manufacturers may even go out of business, providing opportunities for the stronger players.
“While I can’t tell you when business conditions will improve, if history is any indicator, it will come back,” Stanley Furniture’s Doug Payne said. “We are trying to position the business so that we exit this cycle a better business. I think our entire business model puts us in a better position; we’ll be able to respond to that much better than our competition.”
Brian D Casey is President of the High Point Home International Furnishings Market Authority. The High Point Market is the largest furnishings industry trade show in the world, bringing more than 85,000 people to High Point every six months. Show dates for 2008 are April 7-13 and October 20-26. The venue houses 188 buildings with 12 million sq ft of show space. More than 2,000 exhibitors from 110 countries gather here and approximately 10 percent of the attendees are from outside the US.
Casey has 26 years of experience exclusively dedicated to association and tradeshow management. He is also a board member of the Center for Exhibition Industry Research and the International Association of Exposition Managers.
Thinking Out Loud
The Shenzhen International Furniture Exhibition, held March 19-22, 2008, hosted its fi rst forum with the topic: Future of China’s Furniture Industry. As a think-out-loud session, industry leaders and association representatives exchanged their views on China’s ongoing evolution from an export giant to an importer to be reckoned with.
“China now has US$1.5 trillion in foreign reserves. The more it exports, the more it loses. For the past 10 years, the Chinese government’s policy has been geared towards helping manufacturers export. But this is changing. In fact the government is restricting exports now. For example, the export tax rebate was reduced to 11 percent last year. By the end of this year, this subsidy may be scrapped altogether.
Customs fi gures show that Shanghai imported nearly 180,000 pieces of luxury high-end furniture in the fi rst half of 2007, up 38 percent over the previous year. The appreciation of the Renminbi will stimulate more companies and individuals to buy luxury furniture. On the other hand, there will be 80 million additional households in city areas in fi ve years. An estimated 34.8 million households replace their family each year. This is a market that cannot be overlooked.”
Oliver Hou
Secretary General of the Shenzhen Furniture Trade Association
“ASMINDO members sealed deals worth US$15 million at the SIFE last year. Be it as an importer or exporter, I’m sure China will face its fair share of challenges. But buyers will still want to come here and fi nish their Asian sourcing here.”
Ambar Tjahyono
Chairman ASMINDO
“Thai manufacturers/exporters need to fi nd their niche markets. We can’t have prices as low as those from Vietnam and China. It is also diffi cult to go into high-end markets like Italy. It’s a nutcracker situation. Our niche could be the ability to sell furniture according to moods, like a fashion business, rather than traditional categories. We also never thought of China as an export market. We should start exploring this option now.”
Jirawat Tangkijngamwong
Secretary General Thai Furniture Industries Association
“Production prices in the Philippines have gone up. The peso has risen against the dollar by about 20 percent. China could be an alternative market. We hope to enter it step-by-step, based on our comparative advantage. It is indeed good news to us that the Chinese government is revolutionising its strategy for furniture to focus less on exports and welcome imports. We plan to enter China by identifying fi rst the right sales channels and retail concepts that suit our products’ mood.”
Roberto M Locsin
Chairman of the Board Chamber of Furniture Industries of the Philippines
“Vietnamese exports of commodities in 2007 reached US$39.6 billion, including garments. Wooden products are our key exports. In 2005, they were valued at US$1.5 billion, and by 2007 the fi gure rose to US$2.4 billion. The US, EU, Japan, Germany and China are our most dynamic markets. The government supports the furniture trade and has just put in place the policy to increase forest area by 43 percent by 2010. There were no Vietnamese exhibitors in this edition, but I hope they will consider Shenzhen as a gateway to the Chinese consumer market.”
Nguyen Van Dung
Director Trade Service Company (HCM City), Vietnam Chamber of Commerce and Industry
“More exporters are targeting China as a potential consumer market, but I realise that Chinese importers are not very experienced. There is also less price pressure here in general now, so
that is a good thing.”
Sunny Ter
Managing Director Tawei (M) Sdn Bhd Selangor, Malaysia
The news making headlines around the world is economic: recessionary trends in many industrial countries, record high gas prices, extreme food costs, etc. Even China is feeling the heat as some manufacturing begins to move to less developed countries like Vietnam. Consumer spending, the growth engine that has held up many economies for the last several years, is suffering, and homes, our most precious material possession, are at risk for many.
Amidst this gloom and doom is a reality check that, in the long term, will probably lead to a better quality of life for societies that have been obsessed with obtaining more and more of everything, even when they cannot afford the purchases. ‘Downsizing’ is the new mantra which is affecting all types of goods. In food we have restaurants popping up where the chicness is in the small portions, such as Minnies in Chicago that serves up tiny ‘Minnieburger’ sandwiches with airline-size bottles of liquor. Daimler’s Smart car has come to the US and in one year there are already more than 30,000 deposits for these
extra-tiny-micro-compact automobiles. The appliance industry is showcasing smaller unit products that can go in secondary locations, or in a primary location within a single household where less volume is needed. Almost every industry is looking at the downsizing trend, understanding that we have reached a time when ‘less can be more’.
Just coming back from High Point and the Milan Furniture Fair, examples of creative small space solutions abound. ‘Oneinto- two’ describes the new trend in furnishings that morphs from a single entity to a multi-purpose product. The table opens up to a table and chairs; a wall storage unit becomes a bed with integrated night stands. As we demand more functionality from less space, we will continue to see furniture that expands only when needed or items that multi-task. Powell introduced its ‘Mixter Max’ bedroom collection for boys, with special attachable features such as cup holders, basketball hoops, trash cans and media shelves, and a bunk bed with a folding desk that turns into an extra bed for sleepovers.
Furniture will evolve into more practical pieces. Media loungers are taking the place of sofas and chairs by serving the purpose of both in half the space. Storage space opens up from all angles of entertainment units and bars - the sides, top, bottom, front and back. Future concepts incorporate technology right into the furniture, such as the Hi-Can Bed from designer Edoardo Carlino which brings the best quality of sound and a great screen to watch movies, play games or use the internet all seamlessly into your bed canopy.
Some key macro infl uences on furniture design include:
We are moving from ‘matchy-matchy’ décor to an a la carte way of decorating, a way to express our individualism as well as allow for more frequent decorating updates to avoid boredom. In furnishings, we see the mixing of styles, materials, colors and even shapes all within one piece.
Consumers are bored with today’s world of retail generica. Standing out with unexpected details provides a way to capture their attention. It could be the use of color under a shelf or a pattern inside a drawer or even architectural details in new places.
Color and texture continue to increase in importance, particularly as contemporary decor becomes softer in both palette and design. Also, helping to bring sensory pleasure into environments is the use of shape as a differentiator and the ability to bring nature indoors with wood grain details and natural materials.
We desire furniture that looks hand-made, even if it is actually made by machine. New technologies are enabling furniture pieces that give the appearance of being hand-painted or hand-carved, appealing to our desire for a unique home that speaks to our individual taste; similar to the role apparel has played. The increasing role customization is playing in this industry also adds to the artisan effect, with the consumer being the artist.
And at long last, the American home has stopped growing and most predictions are that it will get smaller and more affordable. According to the Wall Street Journal, the average size of a newly built KB Home today is 2,200 square feet (204.39 sq m), 200 square feet (18.58 sq m) less than before the recent housing crisis. Builders are already addressing in new models ways to create small space solutions that provide all the details and amenities which consumers want. We are focusing on doors and windows which bring exterior space into total living area for a seamless transition. The outdoor room has become the outdoor home, complete with shower, kitchen, bedroom and family room areas.
Walls are coming down inside the house – aided by technology that lets us work, eat and entertain anywhere throughout the home. As a result, rooms no longer define functions within the millenium home. For example, a recent Electrolux survey indicates that the kitchen has evolved from the room we cook and eat in, to the room we live in; a focal point of the family’s activities and even social life. One of the show homes at the 2008 International Builder’s Show featured a mini-kitchen in the upstairs hallway. Beyond added luxury, this features provides easy access and privacy for both multi-generational families and homes where adult children are still residing, an increasingly common occurance.
The high cost of real estate and construction will lead to more residential building that goes up rather than out. Vertical-scaping your interior is an easy solution to gain more space: desks that come out from the walls, Murphy-style beds that come down from the ceiling, plasma TVs that can hang versus sit, etc. We like to say that the ceiling has become the fifth wall, as décor moves up from the floor to the walls to even higher sightlines.
With a background in trend merchandising that spans more than 20 years, Maxine Lauer is a member of Color Marketing Group, The Futures Society and the American Marketing Association. As CEO & President of Sphere Trending, Lauer has guided strategic planning for clients since 2000. Sphere Trending (www.spheretrending.com) is a consulting fi rm that specialises in trends affecting our environments, through a deep understanding of consumer needs and desires, societal changes, technological innovations and retail landscapes. It then combines these macro trends with design trends to bring innovative strategies to market.
That’s funny……. interesting and significant!
There exists an important and consistent variable in the attainment and maintenance of high productivity, stable staff composition, customer satisfaction and client retention.
Refreshingly, it need not involve large outlays of capital, investments in infrastructure and systems or the support of expensive incentives.
It is difficult to quantify and is not evident in entity debit and credit registers. However, believe me, it’s impact on market worth, image and competitive advantage is substantial. The contribution to the price: equity value is infinitesimal.
Moreover, management and marketing departments are relieved of the need to authorise and script promotional texts and advertisements which declare that the entity is an employer of choice. This variable is declaration enough.
Many job descriptions and job specifi cations are lacking, because they do not address this attractive and valuable ideal.
Sadly, in the current volatile marketplace with the pressures of time constraints, stress and competitive forces, its presence is less conspicuous and falls sho
