Country Report  

Russia Furniture Industry Celebrates 20 Years

By Artem Vasiliev

2018 is a special year for the Russian furniture industry. This year, the modern Russian furniture industry celebrates its 20th anniversary. Twenty years ago, the fierce economic crisis of 1998 became the starting point of our recent history: that was the time when many enterprises were set up, the ones that today are the market leaders, and the time when furniture industry really began to take off. In just a few years in the late ‘90s — early 2000s, an unprecedented modernization of Russian furniture manufactures was carried out, following which they received the most advanced equipment.

New lumber and wood board manufactures with the participation of both domestic and foreign capital have been built and put into operation. Now the Russian furniture factories are provided with a wide variety of modernly designed high quality wood board materials, which allows them to produce rival products for both domestic and foreign markets.

The development of the industrial base went hand in hand with the increase in the population’s affluence and the formation of the middle class in Russia. Over the past twenty years, Russian business has proved that the consumers’ interests are of paramount importance for it, regardless of any political turbulence or macroeconomic difficulties.

According to the Russian Federal State Statistics Service, in January-October 2017 the furniture production in Russia has increased by 8.1% compared to the same period of the previous year (in current prices, excluding the increase in producer prices by 0.7%). This steady trend, which Russian furniture manufacturers have been maintaining throughout 2017, marks the long-awaited emerge from the stagnation of several previous years. In terms of production growth, the furniture industry is now ahead of almost all other sectors of the manufacturing industry in Russia.

According to preliminary data for 2017, Russian furniture enterprises have started another round of modernization and expansion of existing production facilities and construction of the new ones: the capital investment in the furniture industry in January-September has increased by 22.3%.

Furniture imports that have been pushed back in the period of market stagnation from their positions also showed a positive trend in 2017. In January-September, furniture imports to Russia increased by 21.8%, which is due to the overall market growth that followed the recovery of the customers’ purchasing power after the recession, as well as to unsatisfied demand for products in certain style and price niches, the particular products which today only foreign players can offer.

Among the key drivers of the Russian furniture market further growth is the development of e-commerce (Russia is the largest e-commerce market in Europe) and, perhaps most importantly, the young generation of cosmopolitan consumers, which form the long-term demand for advanced, trend-based interior solutions.

Last but not least, for the first time in the recent history of Russia, the development of furniture exports has been declared one of the important tasks at the governmental level. Under the auspices of the Ministry of Industry and Trade, the Russian Export Center was organized, with which the AMEDORO furniture association started cooperation. As a result, Russian furniture and woodworking enterprises have already received financial support for participation in the international exhibitions and business missions in Germany, the United Arab Emirates, India, Egypt and Turkey. In 2018, for the second year in a row, the business calendar of Russian furniture manufacturers opens with the presentation in Cologne as part of the Russian national exhibition hall at imm cologne show.

Today, Russia, with its ample resources, modern industrial opportunities and a market of a great potential, acts as a unifying force between different countries and continents, as an important economic link and one of the guarantors of stability on the global stage. We are well-assured that Russian furniture makers are capable of doing much for strengthening business relations in the world market and for contributing to the world economy on behalf of Russia.

Artem Vasiliev,
Deputy Chief Editor for Information Policy,
Mebelny Biznes Chairman,
International Alliance of Furnishing Publications