Furniture Sector Growth Aligns With Real Estate Boom in 2014

CEBU, Philippines - While the real estate sector is expected to continuously take an upswing this year, the furniture industry will likewise take the rosy path as it has consistently been gaining a stronger grip on the domestic market in the last couple of years.

PhilExport-Cebu executive director Fred Escalona said that the furniture industry will have an advantage in 2014 as it aligns with the booming construction and real estate industries.

New hotels, resorts, restaurants, condominiums, commercial buildings are seen to contract local furniture makers for their furnishing needs, and that purchase of imported furniture from the local market is seen to decline.

Local furniture makers confirm Escalona’s projection as it projects 10 percent growth this year on top of the robust local as well as improving export markets.

The lady export sector official added that there are some local companies that focus on the country, citing as an example a small group of manufacturers in Aklan that cater to hotels and resorts in the area.

Bituin also emphasized that the project of the Center for International Trade Expositions and Missions (CITEM) about branding also plays an important role in boosting the sector.

Although the domestic market is active now, she warned that companies have to work harder to brand their firms and their products.

Europe is [also] a good market. Europe is very traditional--they can sell your product for 10 to 15 years. So you become good in what you are doing because it is the same product that you have been doing for the past 10 years.

Meanwhile, Cebu Furniture Industries Foundation Inc. (CFIF) president Angela F. Paulin in an earlier interview underscored that now that the Philippines is seen to be one of the biggest markets that will be shared by the local furniture makers, industry players are confident of market strength, despite the availability of "affordable" imported home furnishing products.

The local furniture makers are now hitting the big-ticket furniture clients, such as hotels, condominiums, and other institutional customers, Paulin said adding that the industry is now taking advantage of the increasing demand for custom-made furniture products.

Paulin admitted that the weakening of the global furniture market is not only due to the financial crunch experienced by the giant economies like the United States and Europe, but other factors like natural calamities, disasters and political issues also affected the furniture export market.

While the local market is now taking the spotlight as the ‘savior’ market for the local furniture makers, it is also facing a challenge in embracing the production change, as they are more identified in producing only smaller-scale furniture pieces. Mass production is not yet the local makers’ forte.

Philippine Constructors Association (PCA) president Augusto Manalo said despite the aggressive campaign of furniture exporters announcing their shift to local market, the Philippine market both retail and institutional consumers are still inclined to buy imported furniture or home furnishing products.

About 80 percent of the Philippine furniture and home furnishing demand is still coming from abroad.

In fact, importation of home furnishing and accents in the Philippines grew by 67 percent as of October 2012.

If local players will not put their hands together and corner the profitable market for Philippine home furnishings both residential and institutional sectors, "we will be continuously eaten by our competitors."

Largely, the retail consumers are still buying the imported home furnishing products, and even some new hotels and resorts or even restaurants are importing their home furnishing requirements from other countries.

Cebu Real Estate continues to stand proud of its booming real estate development which great success by leaps and bounds as compared to any city or area in the Philippines today.