India Furniture Industry

The furniture industry in India is considered as a "non organized" sector, with handicraft production accounts for about 85% of the furniture production in India. The furniture sector in India only makes a marginal contribution to the formation of GDP, representing just a small percentage (about 0.5%). Among all the types of furniture used, office furniture segment is the one that boasts the most important companies, both from the point of view of size and of the technological innovation of the production. The furniture industry employs a total of around 300,000 workers. The total production of furniture in 2001 -02 (according to Annual survey of Industry) was USD 3580 million. Foreign trade picture with regard to furniture is not very impressive. In 2000, India ranked 48th among furniture exporters and 49th among importers. This situation can be explained by he high import duty applied, and on the other hand, from the low technological level of Indian companies and the local tastes and traditions that influence the style of the products offered, making them difficult to export. According to data for index of industrial production, as many as 14 of the 17 two-digit industry groups have shown positive growth during the month of January 2005 as compared to the corresponding month of the previous year. However, Wood Products; Furniture and Fixtures' have shown a negative growth of 16.7%. The more recent data shown in the table below , obtained from ministry of commerce, shows the trend in this category over the past 6 months. Aug'2004 Sep'2004 Oct'2004 Nov'2004 Dec'2004 Jan'2005 72 75.5 71.8 71.5 71.7 69

Wood and Wood Products, Furniture and Fixtures" carry a weight of 27.01 % in the total MANUFACTURING SECTOR. This category has however shown a decline in recent some years. The visible consumption of furniture is estimated to be 15 USD per year per inhabitant but this average hides wide variation in populations and in cities.

Usually, a manufacturer or a craftsman has his own store(s) where he presents products or imported furniture. Consumers choose in the store or order bespoke furniture. India presents a favourable outlook to sell furniture and one expects the furniture industry to grow further in the coming years. Two important reasons for this are: First India's large size and; Secondly, Indian tastes have started to be more refined and Indian people are looking for more western furniture style. The prospect of the furniture sector in India seems positive. Several agreements have been signed between local producers looking for technology and European companies trying to reach a market or to reduce their costs. A recent on-field UEAresearch , co-funded by the European Commission, has allowed to identified some 150 Indian companie s (furniture manufacturers and retailers but also banks, hotels, enterprises) wishing to start commercial and/or industrial co-operation with EU counterparts. Their company profiles are quite complete. Legislation on various ways of setting up business and on intellectual property rights exists as well as a lot of advantages for foreign companies to establish business alone or with partners in India . Indian government is continuously taking steps to minimize entry-exit barriers for foreign companies and government is facing pressure to liberalize the duty structure. Further, in comparison with other countries such as China and Mexico, where the time required to start a business is less, India still involves more legal fulfillments. Hopefully, in coming years these shortcomings will be done away with.

Growth of the Furniture Industry in India

India is a land of wonderful and marvelous artistic work of wood. The rich handicraft and beautiful traditional attributes of art and design have established a reputation of Indian Furniture Industry in the nation and worldwide. The exceptional designs, rich, compact, and luxurious trends and, not the least, the supreme quality have given elegance to the furniture segment in the traditional as well as modern aspect. The fast emerging concept of standard lifestyle, interior designing, sense of comfort and architecture has given Furniture Industry an essential ever growing platform and thus empowering the industry to be termed as great manufacturers and exporters of grand quality furniture in terms of art, style, technology and beauty. And of course, globalization and media are also strong factors to give rise to the industry. The strongest factor for this upraise is the huge investment done by the foreign manufactur ers and the credit definitely goes to versatile range of products by the industry. The Indian wooden furniture industry is generating approximately a turnover of Rs 3,500 crore annually. The market of wooden furniture solely owns the share of nearly Rs 60 crore. And as per one of the survey done recently, the industry is expected to grow by 20 percent in coming times. The marked development of the industry has enhanced the leading foreign brands to budget in their confidence and money in Indian Furniture I ndustry. The world market now feels pleasure and confident to join hands with Indian Furniture brands, to name few are Godrej & Boyce Manufacturing Co. Ltd., Furniturewala, Zuari, Yantra, Renaissance, N R Jasani& Company, Furniture Concepts, Durian, Kian, Millenium Lifestyles, Truzo, PSL Modular Furniture, BP Ergo, Tangent, Featherlite and Haworth and much more to add to the growth of the industry. To conclude the vast development and growth of the industry, it can be well quoted that it has infact become a great pride for the nation to hold a magnificent impact for its fine art and marvelous work in furniture all over the world. The future is with too many bright colours of growth miles and miles ahead in terms of unique furniture of all trends to occupy every thought of decorating or renovating the era for decades and decades. Three cheers for the excellent growth of Indian Furniture Industry.

SWOT Analysis
Summary: Just wanted to share a draft version of the SWOT analysis I did a few years back while preparing to take over my family's furniture manufacturing business. Originally, my family's small furniture manufacturing business used to be all about carpentry, craftsmanship and traditional ornamentation. When I was preparing to take over the business a few years back, I knew that consumers were becoming more interested in more modern and cleaner designs. I knew I had to re-evaluate our strategic planning process so I decided to conduct a SWOT analysis. It allowed me to develop my strategies to exploit my competitive advantages and defend against internal weaknesses. It really prepared the ground to allow the successful transformation of 'Sachi's' from traditional craftsmanship to modern design.

Strengths: y y y y y y Increasing demand in modern, clean, minimali st designs Highly educated, skilled, young, capable & dynamic human resources Established branding, tradition Worldly-reknowned outsourcing hub Diversity vs. Ideas (Innovation, Integration) Big democracy= big market & free media

Weaknesses: y y y y y y y Inefficient stock control; outdated system Lack of trust in external organizations Fear of sharing knowledge & taking risks Lack of effective & execution framework Decreasing demand in traditional furniture Industry has slow absorption of innovation & change Lack of quality awareness

Opportunities: y y y y y y y Big potential market in Design sector & emerging new market segment in Services Lower labor costs in outsourcing Research & Development capability More efficient production method Hybrid solutions balancing & blending Need modernization of infrastructure Very little competition in modern furniture design

Threats: y y y y y y Large flucuations in stock control (new production method) Inter-company collaboration is unknown Rising cost of imported goods Pioneering uncertainties Clashes in Diversity vs. Imbalance Fast change Internet (IT), new inventions (Technology, Innovations)