China's furniture industry status quo inventory and development recommendations

In recent years, China's manufacturing industry has suffered from many unfavorable factors such as rapid rise in labor costs, continued appreciation of the renminbi, and sharp rise in financing costs. At the same time, expenditures on electricity, environmental protection, and social welfare (such as employment security for the disabled) are also largely The increase in production and operation costs of enterprises; the excessive rise in the cost of various production factors has caused furniture companies to bear heavy burdens, and production and management are struggling.


The data shows that the labor cost this year has increased by at least 20% compared with last year. In three years, the wages of the Guangdong furniture industry have risen from 1,600 yuan to more than 3,000 yuan, and the number of technicians has climbed from 4,000 yuan to nearly 10,000 yuan. The rising RMB exchange rate has made export-oriented furniture companies more fearful. On September 30, the central parity of the RMB against the US dollar was reported at 6.3549, a new high since the exchange rate reform. On the other hand, since the beginning of this year, global timber resources have become scarce and imported timber prices have been rising. At the same time, timber imports from North America have risen by at least 30% this year due to rising factors such as national policies, exchange rates and transportation costs. Under the weight of rising costs, the confidence of domestic furniture enterprises in the transformation and upgrading and gradient transfer began to shake.


Status and recommendations

Low production costs in Southeast Asian countries attract international and domestic furniture industry transfer

In 2011, with the rising demand for energy, raw materials, land, and especially labor in the domestic coastal manufacturing industry, the domestic low-cost competitive advantage is gradually losing. Some coastal furniture enterprises that manufacture high-end products and export furniture have begun to move overseas. And the mainland, looking for a lower comprehensive production base, a shift from the domestic coastal to the central and western regions, China's transfer to overseas industries is underway. However, with the frequent difficulties in recruiting workers and the shortage of labor in the eastern coastal areas, the labor prices in the central and western regions have also risen.


At present, the salary of Vietnamese workers is about 100 US dollars per month, equivalent to more than 600 yuan. At present, the salary of one of the most common workers in Dongguan is 2,000 yuan. The provinces and cities in the mainland, such as Henan Province, began to implement the revised minimum wage standard on October 1. Up to 1080 yuan per month, in contrast, Vietnam's labor cost advantage is obvious. In addition, Southeast Asian countries have abundant forest resources, and the prices of furniture raw materials are relatively low. This has led to the shift of international and domestic furniture companies to overseas developing countries, which has disrupted the pace of domestic furniture companies' gradient transfer to the central and western regions.


Europe and the United States to improve access to forest products, become a new challenge for the export of China's furniture products

The US Lacey Act stipulates that forest products such as particleboard, fiberboard, plywood, wood pulp and paper, wood furniture, etc., which are exported to the United States, must be marked with the type and source of wood, otherwise the United States will refuse to enter these products; It is also required to label the Latin name, quantity and size and value of the plant species used. Since the implementation of the bill in September last year, it has had a great impact on the export of Chinese furniture to the United States. With the increasing awareness of environmental protection among international consumers, more and more countries are beginning to propose new environmental requirements for wood products; the recent “National Country Labeling Law” issued by the European Union requires that wood products imported into the EU market must obtain FSC status. The certificate requires companies to track the source of their timber harvesting and impose strict requirements on the environmental performance of raw materials. The policy will take effect on March 3, 2013.


It is noteworthy that in the forest products suppliers, Indonesia has also begun to introduce corresponding policies to ensure the legality of the source of timber exports. The implementation of the above-mentioned laws will cause a large number of SMEs in the domestic furniture industry to have to find qualified suppliers or increase the cost of certification of origin. The cost and operational risks of furniture production and export enterprises have increased significantly.

Domestic furniture products market competitiveness is insufficient, brand construction is seriously lagging behind

Most of China's furniture production is based on OEM production. Its advantage lies in the relatively low labor price. The disadvantage lies in the lack of independent quality standard system, original product design and competitive brand. According to the data, there are tens of thousands of large and small furniture brands in China, but there is still no leading brand in the leading industry. Many furniture manufacturers are re-manufacturing and light design, with serious homogenization and low degree of differentiation. Therefore, the export furniture has problems such as low grade and low added value. The product quality has a great gap compared with developed countries, and it directly affects The international status of China's furniture companies.

In the early stage, CCTV exposed furniture manufacturer “Da Vinci” as a fake foreign brand and some products failed. It reflected that there are many small and medium-sized furniture manufacturing enterprises in China, the industry’s independent innovation ability is relatively weak, and the furniture industry standards are not enforced. status quo. The backwardness of Chinese furniture in core competitiveness such as brand building and product research and development is not conducive to promoting industrial transformation and upgrading, which will affect the long-term development of China's furniture exports.

Suggestions for this: First, encourage enterprises to strive to improve the quality of their own branded products, develop high value-added products, increase the technological content of products, and enhance the core competitiveness of furniture exports; second, implement diversified market strategies and actively explore emerging markets and domestic sales. The market will reduce the dependence on developed markets such as the US and Europe, and at the same time adjust its business strategy, and focus on the development of “export” and “internal demand” to actively explore domestic market demand. Third, strengthen daily monitoring and early warning, pay attention to export changes to Europe and the United States and related markets. Signs of policy changes, through the establishment of trade protection policies and early warning mechanisms for technical barriers, help companies understand and respond to foreign trade barriers in a timely manner.

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