Furnishing firms told: Keep pace with global recovery

CEBU, Philippines – Although there are indications that the furnishing sector will recover this year, the success of each company still largely depends on how their respective operations will adapt to innovation and technological advancement.

"Furnishings will expand ever quickly [this year], but the traditional way of doing business would no longer suffice" said economist Bernardo Villegas.

Villegas said that if furnishing companies would really want to take advantage of the recovering market, they need to "marry" automation, technology and innovation, which are very crucial in today's fast changing and sometimes unpredictable environment.

He said Filipinos should leverage in their innate talent in craftsmanship and creativity. Partnering with organizations or firms which have good technological capabilities and modern manufacturing system is essential.

This means that the furnishing sector in the Philippines could maximize the world furnishing market by employing strategic linkage with companies, suggestively foreign firms.

This is the time that modern technology "marries" with market positioning.

According to Villegas the Philippines will see good prospects in the four "Fs"-- furnishing, fabrication, furnishing and fashion.

The market now is turning their interests in these four "Fs", and that companies/investors who are in these businesses should be quick enough go respond to the demand of the market.

On the other hand, he said while the world market is recovering, although it is still carrying the painful effects of recession, Filipino companies are luckier because they are in the home-ground in one of the biggest consumer-base countries in the ASEAN.

Unlike Singapore and other export dependent nations, the Philippines like Indonesia, could survive if another round of world economic recession will hit, because its economy is not dependent on export.

Problems about thinning market potential with expanding number of active competitors should not be a cause of worry, as the Philippines' 100 million domestic market alone can sustain the "life" of companies, including exporters.

Defending their turf in their home-ground market, while strengthening their positioning by partnering with big companies that are experts in modern technology, are just few of the important recommendations that furnishing sector should adhere, so as not to lose the big opportunity.

In 2012, the country’s total furniture production reached US$538 million, of which total furniture export stood at US$137 million and local sales at US$399 million.

The United States remains the country’s top market for furniture exports, accounting for 62 percent. It is followed by Japan, United Kingdom, Italy and Australia.

Local furnishing or furniture makers said although the domestic market acted as the savior of furniture exports over the years, the export market is still the industry's breadwinner.

The expected turnaround of demand starting 2015 may not be as overwhelming as in the 1990s, but what is clear, he said is furniture sector "is here to stay," said Cebu Furniture Industries Foundation Inc. (CFIF) president Robert Aboitiz Booth.

According to Booth, players understood that despite the  excitement for recovery, going back to the same old system in marketing, quality, and design is no longer applicable.

The entry of a whole new set of buyers will pressure the exporters to make strategic positioning, and other changes in the way the players do business.

Chamber of Furniture Industries of the Philippines (CFIP) president Nicolaas De Lange said that the year 2015 will start the movement for collaboration among companies to make them bigger players, as the competition is going to be fatal.

The industry is moving towards working as one, not competing with each other or snatching each other's business, but to pool their resources together, to stay ahead of the competition.

De Lange stressed however, that positive outlook for furniture sector, can not stand alone, but it direly needs the support from the government--in making the environment conducive for business to flourish.